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Per Curiam.
This is a zoning case. Plaintiff landowners have persuaded the circuit court and the Court of Appeals that the Zoning Board of Appeals erred in denying a variance. The defendant township appeals, arguing that the variance was correctly denied. We agree, and reverse the judgments of the circuit court and the Court of Appeals.
I
The parties do not contest the facts. In 1949, the township adopted its zoning ordinance. Sections 501 and 601 of that ordinance provide that, in the district where this controversy arises, a dwelling or other main building is not to be built on a lot that is less than 99 feet wide. A lot of greater width was owned by the grandfather of plaintiff James Johnson. In 1959, the family decided to split the grandfather’s lot into three smaller parcels. It was not until 1961 that deeds and a survey were prepared to effect this division.
When this land was divided, a parcel 60 feet wide was given to the parents of James Johnson. They, in turn, transferred the property to James Johnson in 1973.
There came a time when the Johnsons decided they would like to build a house on their lot. In 1978, they approached the Zoning Board of Appeals, seeking a variance to permit the construction of a residence on their undersized lot.
This matter was considered by the board on several occasions. During at least two of those sessions, the board heard from persons who were concerned about the proposed variance. A decision was rendered on April 26, 1979, after the board viewed the property. The board’s minutes for that occasion include a statement of the subjects covered in the discussion and the reasons why it was denying the variance:
"1. The requirement of 99 feet wide lots was in force when the split that created two sub-standard lots for residential use (Mr. Johnson’s lot and Mr. Menasian’s lot with cottage).
"2. The situation is not unique. It would be created today, at will, by many property owners.
"3. The situation is not a hardship created from outside the property owners’ control. No outside agency, private or governmental, exercised any influence on the creation of this situation.
"4. Potential to resolve the problem by agreement of the two property owners exists, i.e., by rearrangement of the property’s configuration.”
The plaintiffs appealed to the Ottawa Circuit Court in May of 1979. In its opinion of reversal, the circuit court began by criticizing the board’s four stated reasons for denial:_
"The board gave four specific findings of fact and reasons for the denial.
"1. The first reason is that the requirements for a 99 foot minimum width lot was in force when the split was created. That is an accurate statement of the facts.
"2. The second reason is that 'the situation is not unique. It could be created today, at will, by many property owners.’
"That finding, while it may be true, is not a proper basis for a denial. It has no relevance to the consideration as it exists in this situation.
"3. The third finding that 'the situation is not a hardship created from outside the property owner’s control. No outside agency, private or governmental, exercised any influence on the creation of this agency’ is also an accurate factual statement. However it, like the first finding of fact, begs the question. The Supreme Court in [Kropf v Sterling Heights, 391 Mich 139; 215 NW2d 179 (1974),] ruled that one who purchases a parcel of property with knowledge of zoning restrictions is not estopped from challenging the restriction’s validity. They held that an invalid ordinance does not lose its character or 'immunize itself from attack simply by the transfer of property from one owner to another.’
"To suggest that the hardship created on plaintiff was not created by an outside governmental, private or other agency begs the question. The question is whether or not a hardship is imposed by reason of the zoning ordinance and not who created it. The fact that plaintiff may have inherited the property as opposed to having purchased it does not result in any less hardship or make the property any less valuable. The description of the lot would indicate to this Court that it has no valid use for any other purpose than for residential use, be it a summer vacation home or a year-round residence. The proposed use and the only valid use being restricted by the zoning ordinance necessitates a finding of hardship.
"4. The fourth finding of fact is that the 'potential’ to resolve the problem by agreement of the two property owners exists, i.e., by re-arrangement of the property’s configuration.
"The evidence does not support this finding of fact. While there was initially a transfer of some footage to create a 100 foot lot from a Mr. Minasian who owns property directly west of the plaintiff, this transfer resulted in the creation of a sub-standard lot for Minasian and jeopardized his standing with the ordinance. Additionally, it should be noted that the board’s apparent tentative approval of plaintiffs’ proposed use of the change in configuration of plaintiffs’ lot through a transfer of a portion of Minasian’s property would have no effect on the constitutional standards for testing the validity of a zoning ordinance, but would only assure that the technical compliance of the zoning ordinance as it pertained to plaintiffs’ property would be met.”
The circuit court then observed that where there are "practical difficulties or unnecessary hardship in the way of carrying out the strict letter” of the zoning ordinance, MCL 125.293; MSA 5.2963(23) permits the board to "vary or modify” any of the ordinance’s provisions, so that the "spirit of the ordinance” can be observed, and so that "public safety” and "substantial justice” can be assured. Observing further that MCL 125.293a; MSA 5.2963(23a) requires the circuit court to insure, inter alia, that the board’s decision "represents the reasonable exercise of discretion granted by law to the Board of Appeals,” the circuit court found a violation of these statutory duties:
"Pursuánt to the testimony of two of the Zoning Board of Appeals members, the board did not consider the question of the well, sewage system or other health or safety matters. None of these factors which are valid reasons for zoning restrictions were determined by the board to exist and used as a basis for defeating plaintiffs’ petition for a variance. It would seem to this Court that when legislature provides that one of the criteria of the Circuit Court’s review of the Board of Appeals decision a valid use of the police power as it applies to a petitioner’s proposed use of his property and if the ordinance restriction has no valid application to the proposed use and there is a hardship by whomever created by reason of the restriction, then the Board’s decision that because the letter of the law is not met is an abuse of their discretion. In this case, there was no evidence before the Board of Appeals contradicting the plaintiffs’ evidence that the proposed use was not a threat to health, safety, welfare or environmental considerations.”
The Court of Appeals said the plaintiffs had "certainly demonstrated 'practical difficulties’ ” and said "[b]ecause the defendant did not show that the zoning restrictions were determined by health, safety, welfare or environmental considerations, the circuit court was entirely correct in reversing the Zoning Board once plaintiffs had met their burden of demonstrating practical difficulties.” The Court of Appeals went on to explain its view that the plaintiffs need not prove "unique circumstances” and that "the self-created nature of the lot is irrelevant in this case”:
"Defendant’s final claim is that the variance requested by plaintiffs required a finding of an unnecessary hardship in a unique situation. However, the instant question is not one of plaintiffs’ requesting a 'use’ variance. In fact, defendant admits that the parcel in question lies within an area zoned as a residential district. Thus plaintiffs were not asking that defendant rezone their lot; rather, plaintiffs asked only than [sic] an exception be made to the 99-foot width requirement. Although it is not clear that plaintiffs must prove unique circumstances under Bruni v Farmington Hills, 96 Mich App 664; 293 NW2d 609 (1980), it is clear that plaintiffs have demonstrated 'practical difficulties’ under MCL 125.293; MSA 5.2963(23). It is also clear from the record that plaintiff James Johnson’s father and uncles met and agreed to subdivide the property in 1959, two [sic] years after the adoption of the zoning ordinance. Plaintiffs seek to build a summer home longitudinally on the lot and have dug a well for water and installed a septic system which were both approved by the Ottawa County Health Department. Apparently seeing the practical difficulties encountered by plaintiffs, the Zoning Board initially sought possible ways to alleviate plaintiffs’ difficulties. Considering these facts, plaintiffs’ situation certainly was unique. Plus, the only reason that the board really had for denying the variance was their strict adherence to the 99-foot requirement. This the circuit court found to be arbitrary, capricious and an abuse of discretion, and we agree. Regarding the 'unique circumstances’ requirement, this Court held in Beatrice Block Club Ass’n v Facen, 40 Mich App 372; 198 NW2d 828 (1972):
" 'The courts have repeatedly emphasized that the hardship to be unique is "not shared by all others” (emphasis supplied), Tireman-Joy-Chicago Improvement Ass’n v Chernick, 361 Mich 211, 216 [105 NW2d 57] (1960), and "that the hardship of which he complains is suffered by his property directly, and not merely by others.” (Emphasis supplied.) Puritan-Greenfield Improvement Ass’n v Leo, 7 Mich App 659, 670 [153 NW2d 162] (1967).’
"According to this Court in Lorland Civic Ass’n v DiMatteo, 10 Mich App 129; 157 NW2d 1 (1968), at 142, fn 11:
" 'The phrase "practical difficulties” has been regarded as applicable only when an area or dimension variance is sought.’ See Indian Village Manor Co v Detroit, 5 Mich App 679, 684; 147 NW2d 731 (1967).
"Thus, the record demonstrates that plaintiffs indeed have practical difficulties, and as they were requesting an area or dimension variance rather than a use variance, unique circumstances need not be proven.
"Regarding defendant’s contention that plaintiffs cannot request a variance where they knew of the lot requirements, the Supreme Court said in Kropf v Sterling Heights, supra, at 152:
" 'The Court of Appeals then correctly stated that one who purchases with knowledge of zoning restrictions may nonetheless be heard to challenge the restrictions’ constitutionality. An otherwise unconstitutional ordinance, we agree, does not lose this character and immu nize itself from attack simply by the transfer of property from one owner to another.’
"While this statement is not dispositive of defendant’s argument since plaintiffs are not challenging the ordinance itself but rather the Zoning Board’s abuse of discretion in denying the variance, it nevertheless makes sense that a substandard lot created by plaintiffs’ [sic] father should not preclude plaintiffs from seeking a variance. Therefore, we agree with the trial court that the self-created nature of the lot is irrelevant in this case, and in light of the fact that plaintiffs sufficiently demonstrated practical difficulties, we find no error in the circuit court’s findings.”
II
As the circuit court noted, the authority of a township board of appeals to grant variances is found in MCL 125.293; MSA 5.2963(23). That provision states that, where there are "practical difficulties or unnecessary hardship in the way of carrying out the strict letter” of the zoning ordinance, the board may "vary or modify” any of the ordinance’s provisions, so that the "spirit of the ordinance” can be observed, and so that "public safety” and "substantial justice” can be assured.
Prior to March 1, 1979, MCL 125.293; MSA 5.2963(23) provided that the "decision of [a township board of appeals] shall not be final, and any person having an interest affected by any such ordinance shall have the right to appeal to the circuit court on questions of law and fact.” In 1978 PA 637, effective March 1, 1979, the Legislature added MCL 125.293a; MSA 5.2963(23a), providing in detail the nature and procedure of circuit court review:
"(1) The decision of the board of appeals rendered pursuant to section 23 shall be final. However, a person having an interest affected by the zoning ordinance may appeal to the circuit court. Upon appeal the circuit court shall review the record and decision of the board of appeals to insure that the decision:
"(a) Complies with the constitution and laws of the state.
"(b) Is based upon proper procedure.
"(c) Is supported by competent, material, and substantial evidence on the record.
"(d) Represents the reasonable exercise of discretion granted by law to the board of appeals.
"(2) If the court finds the record of the board of appeals inadequate to make the review required by this section, or that there is additional evidence which is material and with good reason was not presented to the board of appeals, the court shall order further proceedings before the board of appeals on conditions which the court considers proper. The board of appeals may modify its findings and decision as a result of the new proceedings, or may affirm its original decision. The supplementary record and decision shall be filed with the court.
"(3) As a result of the review required by this section, the court may affirm, reverse, or modify the decision of the board of appeals.”_
HI
In the present case, the property owners have not mounted a frontal assault on the entire zoning statute, arguing that it was improperly enacted or suffers from some other fundamental flaw. Neither have they persuaded us that the 99-foot width requirement is unconstitutional throughout the zoned district.
What is presented here is thus a routine variance case — routine in the sense that owners of a single lot are attempting to demonstrate that a general requirement ought to be waived as to their particular lot. The board of appeals having denied the variance, the task of the circuit court is to insure that the decision (a) complies with the constitution and the laws of the state, (b) is based upon proper procedure, (c) is supported by competent, material, and substantial evidence on the record, and (d) represents a reasonable exercise of discretion granted by law to the board of appeals: MCL 125.293a; MSA 5.2963(23a). The defendants argue in this Court that the board of review abused its discretion, but we cannot agree.
In Kropf v Sterling Heights, 391 Mich 139, 152; 215 NW2d 179 (1974), this Court stated that "one who purchases with knowledge of zoning restrictions may nonetheless be heard to challenge the restrictions’ constitutionality,” since an otherwise unconstitutional ordinance "does not lose this character and immunize itself from attack simply by the transfer of property from one owner to another.” We adhere to this principle.
In Puritan-Greenfield Ass’n v Leo, 7 Mich App 659, 670-671; 153 NW2d 162 (1967) (a case involv ing a request for a use variance), the Court of Appeals examined authorities that explain the requirements that hardships not be self-created and that the plight of the landowner be due to the unique circumstances of the property. There is no sound reason why those principles ought not to be considered by a board of appeals in the exercise of its discretionary power to grant area, as well as use, variances.
There was no abuse of discretion in denying this request for an area variance. The Zoning Board of Appeals was surely correct in foreseeing that, if these plaintiffs could obtain the requested variance, there would be little basis to ever deny a subsequent similar request. A township board of appeals is authorized to issue a variance where there are "practical difficulties or unnecessary hardship in the way of carrying out the strict letter” of the zoning ordinance. In this case, the only practical difficulty or hardship is one that was produced by the plaintiffs’ family. See 3 Rathkopf, The Law of Zoning and Planning, pp 39-1 ff.
The zoning ordinance preceded the division of this property. Thus the plaintiffs’ problems were not caused by the township, but were caused by the division. Since, prior to the split, this land was being properly used in conformance with the zoning ordinance, we can see no sense in which the township can be said to have unconstitutionally deprived the plaintiffs of their property rights. On the facts of this case, neither can it be said that the Zoning Board of Appeals abused its discretion. The facts are undisputed and serve as a competent, material, and substantial evidentiary basis for the decision of the board.
We therefore reverse the judgments of the Court of Appeals and the Ottawa Circuit Court, and we reinstate the decision of the Robinson Township Zoning Board of Appeals.
Williams, C.J., and Kavanagh, Levin, Ryan, Brickley, Cavanagh, and Boyle, JJ., concurred.
"General discussion of Mr. James Johnson request for a variance than [sic] took place.
"The discussion covered the following points:
"1. Sec. 501/601 of the R.T.Z.O. [Robinson Township Zoning Ordinance.] Lot requirements.
"2. Sec. 502.4 of the R.T.Z.O. Exceptional yard conditions.
“3. Sq. ftge. on a standard lot is 12,573 sq. ft. on Mr. Johnson’s lot is 12,000 [the Court' of Appeals calculated that the Johnsons’ lot had a dry land area of 14,940 sq. ft].
"4. Have any violations of this nature not be enforced.
"5. County Health Standards.
"6. Nature of the House/Building Code.
"7. Was the split a violation of the zoning ordinance.
"8. Possible ways to create a 'legal’ lot.”
Unpublished opinion per curiam, decided April 16, 1982 (Docket No. 55839).
The defendant township’s zoning ordinance includes, in § 1403.3, a stricter "beyond a reasonable doubt” standard:
"The Board shall have the power to authorize upon appeal in specific cases, files [sic, filed?] as hereinbefore provided, such variances from the provisions or requirements of this ordinance as will not be contrary to the public interest, but only in such cases where the Board finds beyond a reasonable doubt that owing to special conditions pertaining to a specific piece of property, the literal enforcement of the provisions or requirements of this Ordinance would cause undue or unnecessary hardship and where it finds that all of the following facts and conditions exist:
"(1) That there are exceptional or extraordinary circumstances or conditions applying to the property in question or to the intended use of the property that do not apply generally to other properties or classes of uses in the same zoning district.
"(2) That such variance is necessary for the preservation and enjoyment of a substantial property right possessed by other properties in the same zoning district and in the vicinity; and
See Padover v Farmington Twp, 374 Mich 622; 132 NW2d 687 (1965), in which this Court considered a 100-foot minimum width requirement.
"(3) That the authorizing of such variance will not be as [sic] substantial detriment to adjacent property and will not materially impair the purposes of the Ordinance or the public interest.” | [
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Per Curiam.
The matter is before this Court pursuant to the recommendation of a majority of the Judicial Tenure Commission that the respondent be publicly censured for his admitted act of proffering to others only a part of a letter sent to him by the Judicial Tenure Commission. It is asserted by the commission that the circulation of the edited letter conveyed the false and misleading impression that certain grievances had been dismissed by the commission without any finding of impropriety on the part of the respondent. In recommending public censure of the respondent, the commission has concluded that respondent’s conduct was "dishonest” and constitutes conduct clearly prejudicial to the administration of justice and misconduct in office, citing Const 1963, art 6, § 30, and GCR 1963, 932.4(b).
I
On May 15, 1981, an attorney filed with the commission a request for investigation of the respondent. The request for investigation alleged partiality by the respondent with regard to the processing of certain misdemeanor charges against a Macomb County Commissioner. In addition it was alleged that in response to the filing of a motion to disqualify the respondent in one of the aforementioned cases the respondent had attacked the integrity or competence of various persons, including the individual who had filed the request for investigation, by typing statements on unrelated court files designed to achieve that effect.
On November 9, 1981, a separate request for investigation dealing with a matter related to the previous request was filed by a different complainant.
On February 4, 1982, the respondent met with a subcommittee of the commission to discuss these allegations. On this occasion the respondent acknowledged that his actions with regard to the charges against the Macomb County Commissioner and with regard to the making of the previously mentioned entries in unrelated court files were inappropriate. The respondent indicated that there would be no repetition of such conduct.
On February 8, 1982, the commission sent respondent a letter the full text of which is as follows:
"PERSONAL & CONFIDENTIAL
"The Honorable Don Binkowski Judge, 37th District Court 8300 Common Road Warren, Michigan 48093
"Re: Grievances #81-1932 and #81-2071
"Dear Judge Binkowski:
"Please be advised that the Judicial Tenure Commission has completed its review of the grievances concerning which your response was previously invited, and with respect to which you appeared before a subcommittee of the Commission on February 4, 1982.
"It is the considered view of the Commission that your conduct in connection with the Myslakowski cases was inappropriate in certain respects, as was pointed out by the Commission subcommittee. At that time, it was indicated, and the Commission again would reiterate, that a disinterested observer might reasonably interpret such conduct on your part as reflecting partiality or favoritism towards Mr. Myslakowski.
"The Commission must also express its disapproval of your practice in making extraneous entries on court files at the 37th District Court. These notations on public records serve no legitimate purpose, unnecessarily demean the object of the notations, denigrate respect for your own office and person, and raise serious doubts in the mind of the public concerning the judiciary’s ability to dispense justice in a fair and impartial manner. However, the Commission’s perception of the gravity of this conduct is tempered by your recognition that such actions were improper, and your representation that there will be no repetition of this practice on your part.
"There being no need for further action, the Commission has, accordingly, dismissed the above grievances.
"Very truly yours,
“/s/Michael J. Kelly
"Michael J. Kelly
Chairman
"MJK:jtk
"cc: All Commissioners”
It is important to note for purposes of the present proceedings that only the final paragraph of the letter reading:
"There being no need for further action, the Commission has, accordingly, dismissed the above grievances.”
appeared on page 2 of the letter.
The respondent, after receiving this letter, modified it by retaining the letterhead of the commission found on page one, folding it over, and superimposing it over page two. As modified by the respondent the letter now read:
"PERSONAL & CONFIDENTIAL
"The Honorable Don Binkowski
Judge, 37th District Court 8300 Common Road Warren, MI 48093
"Marrocco Kennedy [both names handwritten]
"Re: Grievances #81-1932 and #81-2071
"Dear Judge Binkowski:
"There being no need for further action, the Commission has, accordingly, dismissed the above grievances.
"Very truly yours,
'Vs/ Michael J. Kelly
"Michael J. Kelly Chairman
"MJK:jtk
"cc: All Commissioners”
The names "Marrocco” and "Kennedy” were handwritten on the altered letter and were the surnames of the two individuals thought by the respondent to have been those who had filed requests for investigation of the respondent with the commission.
Soon after producing the altered letter, the respondent disseminated it to two of his fellow judges of the 37th District Court, Judge Sherman Faunce and Judge George E. Montgomery. Both Judge Faunce and Judge Montgomery testified that they perceived the altered letter supplied to them by the respondent to be the complete document. Within a few days after dissemination of the altered letter successful efforts were made either by respondent or someone on his behalf to retrieve the copies.
The respondent admitted that he had provided the altered letter to his two colleagues. When asked by the master why he had altered the letter he replied:
"Your Honor, for me to reveal the admonishment by the Commission, in view of a very bitter 1980 campaign, would be to commit political hara-kiri. I thought that the letter was confidential to me, and I was free to do with it whatever I wanted to do in whatever I wanted to do.”
The respondent denied that he had intended to deceive anyone by altering the letter in question.
II
Nathan J. Kaufman, a former judge of the Michigan Court of Appeals, was appointed to act as master in this matter. After hearing evidence, he issued his report in this matter in which he stated in relevant part:
"Your Master concludes that the act of respondent in changing the Judicial Tenure Commission letter, Exhibit C, was not honest. Furthermore, I find that his explanation was a very foolish one — that he did his dishonest acts in the interest of politics.
"Your Master also concludes that the other charges were not established. Further, no one testified as to the respondent’s conduct on the bench, his legal abilities, or his moral behavior. And, while the acts were dishonest, I believe that the matter should have been disposed of after preliminary investigation with private censure in accordance with GCR 1963, 932.7(c); In re Somers, 384 Mich 320; 182 NW2d 341 (1971).”
A majority of the commission, after receiving the report of the master, has recommended that the respondent be publicly censured. In reaching this conclusion, the majority observed:
"On its face, we find Respondent’s conduct to involve a material alteration of the Commission’s communication of February 8, 1982.
"We further find that Respondent’s action in dissemi nating a significantly modified version of the notice of disposition conveyed a false and misleading impression concerning the manner in which the grievances had been disposed of by the Commission.
"We base this conclusion, in part, on the testimony of the Hon. George E. Montgomery and the Hon. Sherman P. Faunce, who were the chosen recipients of Respondent’s truncated letter. Both of Respondent’s fellow judges at the 37th District Court testified that they had viewed the letter as a copy of a formal communication from the Commission advising Respondent the grievances were dismissed. They perceived the letter as being complete and no question arose in their minds of it being less than the entire original communication. We also note the fact neither Judge Montgomery nor Judge Faunce testified that the alleged existence of copy lines or marks on Respondent’s version of the letter gave indication the letter did not purport to be complete. We, therefore, find unpersuasive Respondent’s assertion that marks arising from his copying of the letter gave ready notice that the modified communication was only a portion of a more detailed letter. The testimony of the Hon. Thomas E. Kennedy on these points is also corroborative of Judge Montgomery’s and Judge Faunce’s testimony.”
Finally, the commission concluded:
"We hold that Respondent’s conduct was 'dishonest,’ being contrary to GCR 1963, 953(3), as found by the Master, and, further, would necessarily effect public confidence in the judiciary and hinder the administration of justice. It, therefore, constitutes conduct clearly prejudicial to the administration of justice and misconduct in office within Const 1963, art 6, § 30, and GCR 1963, 932.4(b).
"Respondent’s conduct, as set forth in the Amended Complaint, evidences his studied indifference, if not outright disregard, of the special ethical obligations incumbent on members of the judiciary. Further, the Respondent has, while admitting the salient facts, vocally asserted that his actions were proper in every respect.
"In our view, this course of conduct reflects Judge Binkowski’s inability or unwillingness to abide by the expressed expectations of the Supreme Court that judges of this State must adhere to the '* * * highest standards of personal and professional conduct.’ In the Matter of Bennett, 403 Mich 178, 193; 267 NW2d 914 (1978). The Respondent has thereby made himself a fit subject for disciplinary action by the Supreme Court.
"Wherefore, we respectfully recommend to the Michigan Supreme Court that Respondent be publicly censured in accordance with Const 1963, art 6, § 30 and GCR 1963, 932.25.”
Ill
As a preliminary matter we address the contention of the respondent that the commission’s letter of February 8, 1982, which he admittedly altered, was a letter of "admonishment” and that the commission lacked the authority to issue such a letter. The argument is that if the commission lacked the authority to issue a letter of "admonishment” there can be no sanction imposed for altering it and disseminating the altered version.
This argument is disingenuous in. the extreme, and the very fact that it is being advanced gives us pause. Regardless of whether the commission could impose this level of "punishment,” the fact remains that the respondent took it upon himself to alter the commission’s communication in a manner calculatingly designed to give the impression that the altered version constituted the complete communication. The instant proceedings have not been invoked to test the legality of admonishing the respondent. We reject in toto respondent’s attempt to avoid the consequences of his actions by virtue of a challenge to the power of the commission to issue the letter in question.
Respondent also argues that he has been denied due process in that he was never aiforded an opportunity to cross-examine those who had filed the requests for investigation which ultimately resulted in the letter of reprimand. Once again we reiterate that the question in controversy in these proceedings is not the legitimacy of the contentions of those who filed the requests for investigation. Respondent’s argument in this regard is meritless.
As recently as in In the Matter of Evan Callanan, Sr, 419 Mich 376, 386; 355 NW2d 69 (1984), we had the occasion to state:
"A judge, at any level of the court system presides at the focal point of the administration of justice. For that reason, a judge must be held to the highest standard of any public official.”
We are persuaded that the respondent’s conduct in this matter was designed to convey to his colleagues the erroneous impression that the outcome of the commission’s inquiry into the grievances which had been filed was a straightforward and unencumbered dismissal of those grievances. The respondent’s colleagues testified that such was the conclusion which they drew from what was communicated to them. We are unconvinced by respondent’s assertion that in altering the commission’s letter he had no intent to deceive his colleagues. We accept the conclusion of the majority of the commission that the respondent’s actions were indeed dishonest.
We conclude that the respondent’s actions con stitute conduct that is clearly prejudicial to the administration of justice and misconduct in office. Const 1963, art 6, § 30; GCR 1963, 932.4(b).
The commission’s recommendation is for public censure of the respondent. We conclude that the proceedings in this matter have already accomplished such a purpose, and we are content to let them and the opinion of this Court stand as the public censure of the respondent.
Williams, C.J., and Kavanagh, Levin, Ryan, Brickley, Cavanagh, and Boyle, JJ., concurred.
Five members of the Judicial Tenure Commission recommended public censure of the respondent. Three members dissented.
By order dated July 1, 1984, this Court expressly authorized admonishment as a form of "punishment” available to the Judicial Tenure Commission. GCR 1963, 932.7(c)(ii). | [
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] |
Brickley, J.
This case concerns the ad valorem taxation of a federally subsidized apartment complex, a complex covered by a mortgage which, in effect, bears a 1% interest rate. We must decide the permissibility of determining the true cash value of the property under a variant of the market approach to valuation. This variant approach values the subject property by reference to the selling price of properties also subject to mortgages bearing interest rates well below the market rate. The selling price of the comparable properties is determined by adding the outstanding mortgage balance assumed by the purchasers, the low interest rate notwithstanding, to the consideration to the seller above the mortgage balance assumed. We hold that this approach is impermissible.
Petitioners are the owners of a federally subsidized apartment complex. A number of parcels, having different tax identification numbers, are involved. Together, these properties make up an 8.36 acre piece of property. An apartment complex sits on the land and consists of 120 one- and two-bedroom apartments built in four phases between 1973 and 1976. There are a total of fifteen build ings, which are surrounded by vacant farmland. The complex is located in the City of Galesburg, between the cities of Battle Creek and Kalamazoo.
The apartment buildings are wood frame, "garden” type structures with patios and balconies. The complex is generally well maintained, carefully landscaped, and in good condition. It is 100% occupied and there is a waiting list.
Each phase of construction was separately financed. The Farmers Home Administration (FmHA) loaned 95% of the funds needed for each phase.
The mortgages carry the following terms:
Phase 1 (1973): $295,900 to be jiaid'in 50 years at 7-3/4%;
Phase 2 (1974): $425,600 to be paid in 50 years at 8-3/4%;
Phase 3 (1975): $451,000 to be paid in 40 years at 8-1/8%;
Phase 4 (1976): $464,000 to be paid in 40 years at 9%.
The stated interest rates, however, are never paid. Instead, the FmHA waives all amounts of interest in excess of 1%, except in certain circumstances.
The FmHA imposes a rent schedule on the owners. Rental payments are determined by taking 25% of the tenant’s income or a basic fixed rent set by FmHA, whichever is greater. The fixed rate is well below the market rate for similar apartments. Also, evidence was received which showed that the interest rate was increased whenever a tenant paid 25% of income as rent and that amount was over the basic fixed rent. There was, therefore, no incentive for the owners to rent apartments to persons with high incomes. Other restrictions nearly guarantee that the project will be nonprofit.
In the present case, for the sake of simplicity, the parties have treated the four mortgages as one large mortgage. We will continue that practice. Over the life of the project, the interest rate has never been in excess of 1-1/2%.
We are concerned with the valuation of this property for tax years 1978 and 1979. As of the 1978 tax day (December 31, 1977), the "mortgage” had a principal balance of $1,553,467 and had 40 years of payments remaining at the rate of $3,956 per month ($47,472 per year). Of that amount, 1% constituted interest, with the remaining amount going to pay off the principal. As of the 1978 tax day, the payment schedule and interest rate remained the same, but the principal balance of the mortgage remaining at that date was $1,509,488.
The City of Galesburg assessor, using the cost of reproduction less depreciation method, assessed the subject property for 1978 as having an assessed valuation of $855,000 with a true cash value of $1,710,000. The assessed value for 1979 was $878,000, with a true cash value of $1,756,000.
Petitioners protested both assessments before the local board of review, but received no relief. Separate petitions for review by the Michigan Tax Tribunal were filed and later consolidated on motion of the petitioners. Respondent abandoned its assessor’s valuation prior to trial and instead had an appraisal prepared.
Petitioners’ appraisal, relying on a report of the Michigan Chapter of American Institute of Real Estate Appraisers, used an income approach to value the subject property. The cost approach was rejected because a
"Cost Approach to value without measuring the deficiencies of the property in the competitive market would not measure the True Cash Value. To properly measure the obsolescence would require a measurement of deficient income. The resulting value would thus be a reciprocal of the Income Approach.”
The market approach to value was also rejected for the reason that there was a "lack of sales of similar properties * * * around Kalamazoo.” The appraisal found that a comparison with other apartments "would require adjustments for different rent and demand levels” and "building characteristics and financing.”
In using an income approach to value, petitioners did not capitalize the existing government mandated rents. Instead, the appraisal used a market rent, expenses, and capitalization method. That is, the appraisal assumed the property had no rent schedule or government regulated operation. Under such an approach, the assessed valuation of the property was determined to be $553,000 for 1978 and $555,500 for 1979, with true cash values of $1,106,000 and $1,111,000, respectively.
Respondent’s appraisal used the market approach. The income approach was rejected because the property was rent controlled. The use of market rents and expenses was rejected because
"[t]o try to assign an assumed or fictitious rental rate to the apartments, and an equally fictitious schedule of expenses, in order to arrive at a pseudo, or assumed, net income, as if the project were not subject to the FmHA restrictions, is not a realistic approach to valuing the subject — particularly when the market demonstrates how such properties should be valued.”
Respondent’s appraisal found that the primary value of the projects was its value as a tax shelter. Respondent found, consistent with the idea that the property value was a heavily leveraged tax shelter, that the value of the property was a function of the amount of the mortgage remaining, in essence, that the mortgage was being purchased-. Respondent then set about determining the value of the subject property by comparing it to the sale of other similar government regulated properties.
Six unrecorded sales of FmHA properties on land contract, the details of which are not disclosed by respondent’s appraisal, show the average sale price as being 110% of the outstanding mortgage on each property. Sales of interests in three other FmHA and FHA properties show a range of price from 115% to 126% of the assumed mortgage balance. These percentage figures were arrived at by adding the outstanding mortgage balance of each property to the amount over the mortgage balance paid to the seller and, expressing that sum as a percentage of the mortgage balance. Respondent concluded, after applying this formula, that the value of the subject property was 112% of the outstanding mortgage on the subject property. This percentage resulted in a valuation for tax year 1978 of $870,000, with a true cash value of $1,740,000. The 1979 valuation was $845,-500, with a true cash value of $1,691,000.
A hearing was held on November 26, 1979, before a Tax Tribunal hearing officer. The hearing officer held in favor of petitioners. His proposed judgment found that respondent’s approach to valuation would destroy the principle of uniformity of taxation. Moreover, the officer found that the financing terms could not be considered in determining the true cash value of the property:
"There is a distinction to be made between a property itself and the financing terms under which the property is bought and sold. Respondent would have us believe that the 'usual sale price’ can refer to 'FmHA projects.’ The statute however contemplates the usual sale price of the property, not the financing which accommodates its purchase or sale. Thus, the usual sale price requirement refers to multi-unit apartment buildings in this case, not buildings which happen to be financed with a government subsidy.
"Similarly, the usual sale price must be interpreted to mean that sale which is usual in the open market. If exceptions are carved out, as in the instant case, where only a minute segment of comparable properties have this particular financing arrangement, the 'usual sale’ requirement would become so diluted as to render the term meaningless.
"To require the assessor to analyze the complex financing restrictions noted in the instant case would impose a burden far more onerous than contemplated by the statutory requirements of MCLA 211.27[; MSA 7.27]. The duty of the assessor is to assess primarily the property.”
The Tax Tribunal accepted the hearing officer’s factual findings, but rejected his conclusions. It found respondent’s appraisal persuasive. The "abundance” of market information showed the true cash value of the subject property:
"This Tribunal has always recognized the existence of three sound approaches to value, those being the proper application of the 'cost approach,’ 'income approach’ and 'market data approach.’
"All three methods should be utilized when the necessary data is available as it is in the instant case.
"It appears to this Tribunal that it flies in the face of being the proper approach to value, 'the usual selling price,’ when one uses an income approach that results in a value indication that only totals approximately 70% of the mortgage balance of subject.
"On the other hand, it also appears to this Tribunal that the 'usual selling price’ cash value can be best obtained from the market and sales analysis when an abundance of such information was available, as it was in the instant case, and supported by the record.
"The Petitioner has failed to sustain the burden of proof in establishing the true cash value of subject property.”
Petitioner appealed to the Court of Appeals, where the decision of the Tax Tribunal was affirmed. 109 Mich App 627; 311 NW2d 432 (1981). The Court found the decision of the tribunal was supported by the evidence. The Court concluded:
"We think it is equally obvious that where the chief value of a property in the marketplace is as a tax shelter and the price that a buyer is willing to pay at a private sale is determined by that aspect- of the property (indeed, it appears that the market for such property is created by the tax shelter aspect of the property), it is correct to consider the value of the property as a tax shelter in determining the [true cash value] of the property. The Tax Tribunal decision was supported by competent, material, and substantial evidence, and there was no error of law or adoption of wrong principles.” 109 Mich App 633-634.
Judge Bronson dissented, 109 Mich App 634, on the ground that the majority decision violated the principle of uniform taxation. He felt that all financing terms should be disregarded when assessing property and posited the hypothetical situation of two identical, side-by-side houses being assessed a different value because one of the houses was subject to a low interest rate.
This Court granted petitioner’s application for leave to appeal. 418 Mich 874 (1983).
I
Const 1963, art 9, § 3, provides:
"The legislature shall provide for the uniform general ad valorem taxation of real and tangible personal property not exempt by law. The legislature shall provide for the determination of true cash value of such property; the proportion of true cash value at which such property shall be uniformly assessed, which shall not, after January 1, 1966, exceed 50 percent; and for a system of equalization of assessments. The legislature may provide for alternative means of taxation of designated real and tangible personal property in lieu of general ad valorem taxation. Every tax other than the general ad valorem property tax shall be uniform upon the class or classes on which it operates.”
The Legislature carried out the constitutional command to provide for the determination of true cash value by enacting MCL 211.27; MSA 7.27. MCL 211.27(1); MSA 7.27(1) provides:
"As used in this act, 'cash value’ means the usual selling price at the place where the property to which the term is applied is at the time of assessment, being the price which could be obtained for the property at private sale, and not at forced or auction sale. A sale or other disposition by the state or an agency or political subdivision of the state of land acquired for delinquent taxes or an appraisal made in connection with the sale or other disposition or the value attributed to the property of regulated public utilities by a governmental regulatory agency for rate-making purposes shall not be considered controlling evidence of true cash value for assessment purposes. In determining the value the assessor shall also consider the advantages and disadvantages of location; quality of soil; zoning; existing use; present economic income of structures, including farm structures; present economic income of land if the land is being farmed or otherwise put to income producing use; quantity and value of standing timber; water power and privileges; and mines, minerals, quarries, or other valuable deposits known to be available in the land and their value.”
As is obvious from a reading of Const 1963, art 9, § 3, providing the method by which the true cash value of property is determined is a legislative function. Also obvious from a reading of MCL 211.27(1); MSA 7.27(1), is that in carrying out that constitutional command, the Legislature avoided specific directions and, instead, provided for the determination of true cash value by way of broad phrasing and lists of situations to consider. As a result, it has fallen to the courts to approve or disapprove specific methods of determining true cash value, guided by those available expressions of legislative intent.
Generally, there presently are three methods of valuation which are acceptable to the Michigan Tax Tribunal and the courts. They are the costless-depreciation approach, the capitalization-of-income approach, and the market approach. Con sumers Power Co v Big Prairie Twp, 81 Mich App 120; 265 NW2d 182 (1978); Wolverine Tower Associates v City of Ann Arbor, 96 Mich App 780; 293 NW2d 669 (1980). It is the duty of the Tax Tribunal to select the approach which provides the most accurate valuation under the circumstances of the individual case. Pantlind Hotel Co v State Tax Comm, 3 Mich App 170; 141 NW2d 699 (1966), aff'd 380 Mich 390; 157 NW2d 293 (1968). Furthermore, court review of decisions of the Tax Tribunal, in the absence of fraud, is limited to determining whether the tribunal made an error of law or adopted a wrong principle; the factual findings of the tribunal are final, provided that they are supported by competent and substantial evidence. Const 1963, art 6, § 28; Fisher-New Center Co v State Tax Comm (On Rehearing), 381 Mich 713; 167 NW2d 263 (1969).
II
The primary issue in this case is whether the Tax Tribunal adopted a wrong principle when it determined that the true cash value of a subsi dized apartment complex could be determined by the particular market approach suggested by respondent. As previously stated, respondent’s version of the market approach to valuation, as is typical when using that method, determined the true cash value of the subject property by reference to the selling price of a number of comparable properties. Of course, in the abstract, that is a perfectly acceptable method. In the present case, however, the typical comparable transaction involved the buyer assuming the federally subsidized mortgage and also paying a certain amount of consideration to the seller. Respondent determined the selling price of the comparable properties by adding the amount of the federally subsidized mortgage assumed by the purchaser of each property to the amount of consideration given to the seller. We hold that in accepting this method of valuing the subject property the Tax Tribunal adopted a wrong principle.
The rule in Michigan, as in many other states, is. that the selling price of a particular piece of property is not conclusive as evidence of the value of that piece of property. See Fisher-New Center Co, supra; Cleveland-Cliffs Iron Co v Republic Twp, 196 Mich 189; 163 NW 90 (1917). See, generally, Anno: Sale price of real property as evidence in determining value for tax assessment purposes, 89 ALR3d 1126. The Legislature has commanded that property be assessed at its "usual selling price.” The most obvious deficiency in using the sales price of a piece of property as conclusive evidence of its value is that the ultimate sale price of the property, as a result of many factors, personal to the parties or otherwise, might not be its "usual” price. The market approach to value has the capacity to cure this deficiency because evidence of the sales prices of a number of comparable proper ties, if sufficiently similar, supports the conclusion that factors extrinsic to the properties have not entered into the value placed on the properties by the parties. Nevertheless, if it can be shown that the sale price of each of the comparable properties has been determined by a flawed method the result of the market approach to valuation will also be flawed.
Respondent presented to the Tax Tribunal evidence of the sales price of nine comparable properties. All were similar apartment complexes encumbered by low-interest mortgages (although one of the comparables was encumbered by a 7.5% mortgage) such as the mortgage covering the subject property. The mortgages were issued either by the FmHA or the FHA. The first three comparable properties were sold under the following terms:
1) $120,000 to the seller plus buyer’s assumption of the $696,000 mortgage balance, for a total price of $816,000. (Purchase price equals 117% of mortgage balance.)
2) $76,000 to the seller plus buyer’s assumption of the $511,000 mortgage balance, for a total price of $587,000. (Purchase price equals 115% of mortgage balance.)
3) $750,000 to the seller plus buyer’s assumption of the $2,900,000 mortgage balance, for a total price of $3,650,000. (Purchase price equals 125.86% of mortgage balance. Mortgage interest rate was 7.5%.)
The remaining six comparable sales involved sales under land contracts, the terms of which were not disclosed either to the Tax Tribunal or to this Court. Respondent’s figures regarding each sale were expressed in terms of a purchase of 98% of the owners’ interest in each property:
4) Purchase price of $1,500,000, which includes assumption of $1,400,000 mortgage balance. (Purchase price equals 107% of mortgage balance.)
5) Purchase price of $1,300,000, which includes assumption of $1,200,000 mortgage balance. (Purchase price equals 108% of mortgage balance.)
6) Purchase price of $1,070,000, which includes assumption of $1,000,000 mortgage balance. (Purchase price equals 107% of mortgage balance.)
7) Purchase price of $1,200,000, which includes assumption of $1,100,000 mortgage balance. (Purchase price equals 109% of mortgage balance.)
8) Purchase price of $765,000, which includes assumption of $700,000 mortgage balance. (Purchase price equals 109% of mortgage balance.)
9) Purchase price of $330,000, which includes assumption of $300,000 mortgage balance. (Purchase price equals 110% of mortgage balance.)
Extrapolating these six land contract purchases to a purchase of a 100% interest in each property, respondent concluded that the average purchase price was 110% of each property’s mortgage balance. On the basis of all nine transactions, respondent concludes that the subject property has a value of 112% of its mortgage balance in any given year.
The fatal flaw in respondent’s analysis is in its claim that the outstanding mortgage balance of a mortgage bearing an interest rate well below market rates has a dollar for dollar relationship to the value of the property. We do not accept that claim. Assuming a mortgage bearing a 1% interest rate in the market of 1977, 1978, or even today, does not translate into the assumption of a liability, or a value to the seller, in the amount of principal which remains to be paid on that 1% mortgage. We find the analysis of the Tax Tribunal in Meadowlanes Limited Dividend Housing Ass’n v City of Holland, unpublished opinion, Docket No. 55933, decided January 6, 1984, instructive on that point:
"A mortgage is an intangible asset. Although some intangible assets are equivalent to their face values, many are not. The mortgage instrument in question was neither new, nor competitive as to its interest rate. All [the owners’ appraiser] did was to apply a discount rate which was prevalent in the commercial paper marketplace, so as to reflect the amount of currency which could be commanded by such instrument as of the tax date.
"If such mortgage instrument had been dated as of the tax date, and if it had contained terms and interest rate which were then competitive with other similar commercial paper then selling at face value, then its face (or nominal) value would have been the same as its cash equivalence, and adjustment would have been unnecessary.
"We consider this to be no different than the following example: If a seller of real property were to accept gold coins as payment for the property, and if the coins had a face value of $10, but the value of the gold content of such coins was $100, the conclusion would be that the sale reflects a true cash value for the property of $100. However, in this example, we doubt the assessor would contest such a conclusion.
"The same would be true if foreign currency were the consideration for the sale, where the rate of exchange for such currency varied from its face value (but the denominations of the currency were the same as for domestic currency).
"This explains why [the owner] testified that he did not consider that he and his partners paid $2.4 million for the property. They promised to pay a total of approximately $2.4 million (over time), but the length of time is so long, and the interest rate so low, that the promise, when made, was only worth $750,000. In other words, if, rather than taking this mortgage, the mortgagee had instead invested $750,000 as of the date of the mortgage execution, at the then prevailing interest rates, at the end of the mortgage term, it would have had approximately $2.4 million. Obviously, no private investor would have taken such a mortgage.”
As an example, in the present case, the hypothetical purchaser of the subject property would have to assume, approximately, a mortgage with a principal balance of $1,500,000. That amount, however, is subject to an interest rate of only 1% and is payable over 40 years. Under the terms of the mortgage, monthly payments of $3,764 were necessary. Petitioners submitted evidence which showed that an investment of $433,232 at an interest rate of 10.25% would generate enough income to make those $3,764 payments. To say that the mortgage balance had a value of $1,500,000 when it could be entirely assumed by giving up the use of $433,232 is to give an entirely new and foreign meaning to the word value. By failing to discount the outstanding mortgage balance of the comparable properties to the actual cost to the investor the Tax Tribunal adopted a wrong principle.
It is obvious that respondent’s market approach does nothing more than determine the amount of consideration to the seller over and above the assumption of the mortgage. In that regard, the method may be entirely valid. Since, as respondent claims, the value of these subsidized properties lies in the tax consequences of depreciating these properties, it would not be surprising that, to some extent, the value of such properties is a function of their leveraged nature. Thus, respondent may well be correct in its claim that, upon sale, petitioners would have received an amount equal to 12% of the mortgage balance outstanding in consideration above the assumption of the mortgage. Nevertheless, it has not been established that the method tells us anything about the value of the mortgage, or of the property as a whole.
The Tax Tribunal seemed startled at the possibility that the subject property might be worth less than 70% of the principal balance of its mortgage. Together, petitioners and the federal government spent $1,718,325, to build the complex on the subject property. Using the cost of reproduction less depreciation method, respondent’s assessor valued the property at over $1,700,000. Nevertheless, if the market method to valuation is used, and the non-market mortgage is discounted, the property might reflect a value even less than half its cost immediately upon completion. Upon further analysis, however, such a result is not improbable.
Without the federally subsidized mortgage such properties would be nearly worthless. Evidence showed that such projects are typically constructed in areas where rents, if at market rates, would be beyond the financial capability of the local population to afford. Furthermore, evidence was introduced which showed that the quality of construction in such projects was greater than usually seen in non-federally subsidized projects, thus increasing their cost, but adding little value which would command greater rents if the market could bear them. As stated in Meadowlanes Limited Dividend Housing Ass’n, supra:
"Without the federal subsidy, neither [the owner] nor any other prudent investor could have been induced to invest in the project. The cost to build these units would require rental income far in excess of what could be obtained in the marketplace (and still generate sufficient profit so as to be economically viable). In fact, without the subsidy, debt service would be so high, there would be substantial negative cash flow which could reduce the tax shelter benefit to a point where the shelter was no longer an incentive to purchase.”
Even the most desirable structure, if, for example, placed in an undesirable location, may be immediately worth much less than its cost to construct. Other factors can lead to the same result.
That is not to say that these subsidized properties, nearly guaranteed by federal rent ceilings to generate no income, have no value. The market approach, when properly used, demonstrates that there is a value to these properties, although considerably less than their cost to construct.
The foremost value of these properties is found in the tax benefits they generate to the owner. See, generally, Kentwood Apartments v City of Kent-wood, 1 MTTR 295 (1977). Indeed, since property such as that involved in the present case has little capacity to earn income, the availability of the tax benefits may be the only reason to purchase such property. To the extent that tax benefits to a typical owner affect the "usual selling price” of property, they are properly included within the true cash value of the property. Tax benefits, like deed restrictions, Helin v Grosse Pointe Twp, 329 Mich 396; 45 NW2d 338 (1951), and zoning classifications, Kensington Hills Development Co v Milford Twp, 10 Mich App 368; 159 NW2d 330 (1968), of course, are not real property. Nevertheless, such incorporeal items, not taxable in and of themselves, can increase or decrease the value of real property, and that amount should be reflected in the assessment process. As stated in In re Appeal of Johnstown Associates, 494 Pa 433, 440; 431 A2d 932 (1981):
"Certainly, the tax status of the particular property owner is not a relevant inquiry under traditional circumstances; however, depreciation tax shelter benefits associated with investment property ownership inherently affect market value, and the court is not constrained to determine market value as though real property ownership lacked tax shelter features.”
We express no opinion as to the actual value of the subject property in the present case or whether, on the particular facts, a “market approach to valuation provides a measure of true cash better than other methods. Furthermore, we intimate no opinion as to whether the creation of a formula expressing the value of subsidized property as a function of its discounted outstanding mortgage balance may substitute for traditional comparisons under the market approach. Although the existence of tax benefits may be considered in determining value, we express no opinion as to the effect of such benefits in the present case. Those are decisions initially for the Tax Tribunal, if raised in that forum. We merely hold that the Tax Tribunal adopted a wrong principle when it valued the subject property by reference to the outstanding balances on mortgages carrying terms well below market rates.
Reversed and remanded.
Williams, C.J., and Kavanagh, Levin, Ryan, Cavanagh, and Boyle, JJ., concurred with Brickley, J.
The following descriptions of the three basic valuation techniques are taken from the Michigan State Tax Commission Assessor’s Manual, which, under MCL 211.721; MSA 7.40, all government assessors are required to use:
Market Approach
"The market value of a given property is estimated by comparison with similar properties which have recently been sold or offered for sale in the open market. The principle of substitution is applied, i.e., when property is replaceable, typical buyers will not purchase it at a higher price than those paid for similar properties with comparable locations, characteristics, and future earning capabilities. Of all appraisal methods the market data approach is the most direct, the best understood, and the only one directly reflecting the balance of supply and demand for a whole property in actual market place trading.” 1 State Tax Comm Assessor’s Manual, Ch VI, pp 1-2.
Cost Less Depreciation Approach
"In reality the cost approach is another type of comparative or market data approach. The land is considered to be unimproved and valued by methods [stated elsewhere in the manual]. The reproduction cost or replacement cost of the improvements is developed by comparison with the cost of new improvements, based on current prices of labor and materials for construction of similar improvements.
"For most structures, depreciation must be deducted from this estimate of cost new because an old or used property is usually less valuable than a similar new one. This loss in value (depreciation) may be divided into three categories which are often estimated separately: physical deterioration, functional obsolescence, and economic obsolescence.” 1 State Tax Comm Assessor’s Manual, Ch VI, p 4.
Income Approach
"The income approach is based on the premise that there is a relation between the income a property can earn and its value. A large number of commercial properties are purchased and leased to tenants by the owner who does not get the advantages arising from his own occupancy of the property. Consequently, the future net income the property is capable of earning is the main benefit to the owner. For this reason the worth of the property to prospective purchasers is based largely upon its income. In addition to income earned annually during an ownership term, another important benefit is the net amount received from the sale of the property when ownership is terminated. The earning potential of the property at that time will directly affect its sale price. The net income earning capacity of the property now and at ownership termination is, therefore, an important gauge of its value. The income approach to value translates the estimated future income of a property into total present value by the use of various data and organized mathematical computations.” 2 State Tax Comm Assessor’s Manual, Ch X, p 1.
Of course, there are valid variations of each method. By listing and providing capsule descriptions of these three methods we do not intend to preclude the development or use of other valid methods to valuation.
As is obvious from a review of the sums involved in the various transactions, the comparable properties were not comparable as that term is usually used. Physically, the comparable properties are quite different from the subject property. The location, size, and age of the "comparable” properties vary widely. However, it is respondent’s contention that size, location, age, and even condition are irrelevant when valuing federally subsidized property. According to respondent, these properties are purchased for their tax benefits, those benefits are a function of the outstanding mortgage balance, and, therefore, the only relevant attribute of the property is the mortgage balance outstanding at the time of purchase. By converting the purchase price of the "comparable” properties to a percentage of the mortgage balance on each property, respondent mathematically creates a "market” percentage which, according to respondent, may be used to value the subject property, thus avoiding the need to compare the subject property to physically similar properties.
Furthermore, respondent’s failure to completely disclose the terms of the six land contract transactions renders the information derived from those sales meaningless. It is possible that payments made under the land contract were used by the land contract vendor to pay off the mortgage. This arrangement is treated by respondent as the equivalent of an assumption. If the land contracts carried market interest rates, the stated prices in the contracts might properly be used as comparables for the purpose of the market approach to valuation. Without knowing the interest rates of contracts, however, no conclusions can be drawn. It is quite possible that the land contracts carried a blended interest rate, reflecting the non-market mortgage interest rate and a market rate for the amount attributable to the premium above the outstanding mortgage balance. It is also possible that the land contracts simply carried the interest rate of the non-market mortgages and that the premiums above the outstanding mortgage balances were paid to the land contract vendors as down payments. In these latter two cases, the land contract transactions would suifer from the same flaw found in the mortgage assumption transactions. In any event, since we do not know the terms of land contract transactions, we cannot assume that they accurately represent the value of comparable properties. | [
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Cavanagh, J.
This appeal involves the disbursement of $125,000, plus interest, which remains in an escrow account. The issue of first impression presented here is whether the Michigan Corporation and Securities Bureau has the authority to impose conditions concerning the disbursement of funds acquired from the sale of a registered security, beyond the condition that these proceeds be impounded until the issuer of the security receives a specified amount from the sale. We hold that the bureau has no such authority.
I
In 1972, Robert L. Foote decided to develop a 182-unit apartment complex in Kentwood, Michigan. Foote was the principal and owner of Springfield Corporation, a general contracting firm which was ultimately retained as the general contractor for the project. Foote attempted to develop the project with his own resources, but later decided to make a limited partnership offering to finance the completion. The underwriter of the offering was Financial Services Corporation of America (FSC). The limited partnership was named Foote Hills Associates. Foote was designated the general partner and FSC Properties the only special Class B limited partner. Six hundred sixty-seven Class A limited partnership interests were to be offered at $1,000 per unit.
This offering was properly registered by qualification pursuant to the Michigan Uniform Securities Act, MCL 451.501 et seq.; MSA 19.776(101) et seq. On April 16, 1973, the Corporation and Securities Bureau of the Michigan Department of Commerce authorized Foote Hills Associates and FSC (issuer) to make the offering, subject to several conditions. Condition 3 provided in pertinent part:
"The issuer shall deposit or cause selling broker-dealer to deposit and leave with the depositary until further order of the Bureau in a special impoundmend [sic] account 100 percent of the gross receipts accepted, being 100 percent of the offering price, derived from the offer of securities pursuant to this registration statement, subject to the rules of the Bureau and the terms of an impoundment agreement satisfactory to the Bureau between the issuer and the depositary. (Emphasis added.)
The impoundment (escrow) agreement between FSC (broker-dealer/underwriter) and Michigan National Bank (escrow agent), dated April 12, 1973, contained a schedule for the disbursement of the impounded proceeds:
"5. The Escrow Agent shall retain and hold such deposits as escrow agent for the conditional subscribers named in Item 4 above, and the right and title to such deposits shall rest with them alone, free and clear of any counterclaim, debt, or lien until the said department by its order, releases said deposits. Following such release, the Escrow Agent shall thereafter release such deposits to Underwriter upon the happening of the following events:
"(i) Upon compliance by the Underwriter with the condition in the order requiring this Escrow and upon request of the Underwriters the sum of $417,000.00 shall be released to the Underwriter.
"(ii) Upon request of the Underwriter and delivery to the Escrow Agent of the certificate of the Project Architect, Dimitrios Economedies, AIA, that the Project undertaken by the Issuer is 75% complete, the sum of $125,000 shall be released to the Underwriter.
"(iii) Upon request of the Underwriter made on the date of the initial closing of the Permanent Loan, the Escrow Agent shall release the remaining $125,000 then in Escrow together with all accrued interest, if any;
"(v) The term "Initial Closing of the Permanent Loan” shall mean the closing at which the Permanent Loan is initially funded in at least the 'floor’ amount of $2,250,000. Initial Closing may take place either before or simultaneously with the Final Closing of the Permanent Loan.”
A similar disbursement schedule was included in the offering circular and limited partnership agreement, which were given to the prospective limited partners.
All of the 667 limited partnership interests were sold to the intervening defendants. The first two disbursements were subsequently made pursuant to conditions 5(i) and (ii) and under the bureau’s orders.
In the spring of 1974, it became apparent that Springfield Corporation would be unable to complete the project. FSC hired plaintiff Fred J. Schwaemmle Construction Company as a consultant. Extensive negotiations ultimately led to the complete withdrawal of Foote and Springfield Corporation from the project and the substitution of Schwaemmle as the general contractor. On May 30, 1974, a construction completion agreement was entered into by Foote Hills Associates, intervening plaintiff Kelly Mortgage and Investment Company (the construction mortgage lender), and Schwaemmle. The parties agreed that Schwaemmle would receive a $75,000 fee, over and above the costs of construction, for completing the project. Kelly Mortgage subsequently agreed to waive past defaults on the nearly $2 million construction loan, declined to commence foreclosure proceedings, and advanced another $150,000 to complete the project.
As part of its administrative duties as the special limited partner, FSC Properties sent a letter to the limited partners in May, 1974, advising them of these developments. Specifically, the part ners were told that Foote was unable to complete construction and that the funds from the original construction loan were insufficient. They were warned that it might be necessary to release the final $125,000 limited partners’ capital toward completion of construction prior to the closing of a permanent loan. If this became necessary, the partners would have to approve this change in the disbursement schedule since it was included in the offering circular and limited partnership agreement. It was also noted that the permanent loan commitment had expired in March, 1974, and that permanent financing might not be obtained until the end of 1974 or early 1975. Nevertheless, the partners were assured that there was hope for the project on the basis of Schwaemmle’s successful construction record and Kelly Mortgage’s willingness to cooperate.
Schwaemmle subsequently completed construction in the fall of 1974. On September 12, 1974, FSC Properties notified the limited partners of this progress. After briefly referring to the May report, the letter stated that the partnership had to advance an additional $125,000 from the funds being held for Springfield Corporation pursuant to § 8.5 of the limited partnership agreement. Although Springfield had agreed to relinquish its claim to this money because it had not completed the project, at least 51% of the Class A limited partners had to approve the change. The limited partners were asked to complete an enclosed ballot concerning the amendment of § 8.5, which would purportedly allow the funds to be paid toward the actual costs of completing the project.
All of the limited partners agreed to this modification. However, the Corporation and Securities Bureau was never notified of this proposed amendment before the ballots were sent out. Plaintiffs maintain that after the ballots were returned, they petitioned the bureau in November, 1974, for the disbursement of the final $125,000 from the escrow account. That petition apparently was never acted upon.
Even though construction was completed and the apartment units were leased, permanent financing could not be obtained. In addition, some of the subcontractors, laborers, and materialmen had not been paid. Kelly Mortgage foreclosed on its construction mortgage and purchased the complex in May, 1976, for approximately $3.5 million. In September, 1977, Kelly Mortgage sold the property for $2.75 million.
In late 1977, Schwaemmle petitioned the bureau for the release of the $125,000. It asserted that it had never been paid its $75,000 fee and that it had performed all of its contractual obligations. The bureau issued a preliminary order on November 22, 1977, directing that the remaining escrowed funds be returned on a pro-rata basis to the indi-, vidual limited partners because a permanent loan commitment had never been obtained.
An administrative hearing was subsequently conducted. The hearing officer informed the parties at the outset that the only issues that would be determined were whether the terms of the escrow agreement had been met or waived and, if not, whether the limited partnership or the individual limited partners should receive the es-crowed funds. The officer believed that he did not have the power to evaluate the parties’ other equitable and legal claims to the fund. However, he did allow the parties to make a limited record for appellate purposes.
In an order dated January 25, 1978, the hearing officer upheld the preliminary order returning the funds to the limited partners. He reasoned that § 305 of the securities act permits the Corporation and Securities Bureau Administrator to impound the proceeds from the sale of a security and to determine the conditions of any such impoundment. Administrative Rule 705.3 further provides that these funds can be released only by a written petition affirming compliance with the registration. The escrow could only be broken with the consent of the bureau. It was undisputed that the terms of the escrow agreement were not met since permanent financing was not and could not be obtained. The only basis for not returning the funds to the partners would be if they had properly waived their right to the funds.
The officer concluded that the purported waiver was ineffective for three reasons. First, the funds could only be released by order of the Commerce Department. No one ever requested approval of the waiver or consulted the bureau to determine the appropriate method of doing so. The officer believed that plaintiffs were attempting to change "the ground rules of the game,” which would consequently change the risks for the limited partners.
Second, the bureau was required, in conjunction with the sale of securities, to ensure that an offering is fair and provides full disclosure so that an investor can make an informed decision. The securities act provides various protections, including the escrow provision. In addition, § 410(g) makes void any waiver by an investor of the protections afforded by the act or the rules and orders of the bureau.
Finally, disclosure was grossly inadequate for an effective waiver. The officer based this conclusion on an examination of the agreements, letters, and ballot, as well as the testimony of three limited partners. These witnesses testified that they were unaware of the escrow account and believed that they were merely authorizing payment to Schwaemmle as the new general contractor. They did not intend to waive the conditions of the escrow agreement or their right to the funds.
The Ingham Circuit Court reversed the bureau’s decision on the ground that there was substantial, competent, and material evidence to support plaintiffs’ claims that the waivers were valid. The funds were awarded to plaintiffs and intervening plaintiffs.
The Court of Appeals reversed the judgment of the circuit court and reinstated the bureau’s decision. 109 Mich App 96; 310 NW2d 907 (1981). It concluded that the circuit court did not use the proper standard of review, but conducted a proceeding de novo. The Court stated that § 305(f)(2) authorized the bureau to impose, either by rule or order, conditions concerning the escrow agreement beyond those relating to the minimum amount required for release. Rule 705.3 similarly authorized the administrator to impose other conditions on the release of escrowed funds. The administrator’s April 16, 1973, order incorporated the conditions contained in the escrow agreement. The parties conceded that condition 5(iii) of that agreement had never been met.
As to the purported waiver, the Court of Appeals noted that paragraph 5 of the bureau’s order stated that the terms of the order and registration statement could not be altered without prior bureau approval. No such approval was requested or received. Furthermore, § 410(g) prevented the amendment. Even if the limited partners could have waived the escrow condition without prior bureau approval, the September, 1974, letter requested an amendment as to the party entitled to the money once the escrow condition had been met. The letter and ballot did not refer to the escrow agreement, and there was no evidence that the limited partners actually knew that the amendment was designed to alter the escrow agreement.
This Court granted plaintiffs’ and intervening plaintiffs’ delayed application for leave to appeal. 417 Mich 1041 (1983).
II
Plaintiffs and intervening plaintiffs initially argue that the Corporation and Securities Bureau cannot condition the release of impounded proceeds on anything other than the success of the initial offering. The bureau allegedly exceeded its statutory authority when it conditioned the release of two installments upon the 75% completion of the project and the acquisition of permanent financing.
This dispute is governed by the Michigan Uniform Securities Act. The act was designed to protect the public from fraud and deception in the issuance, sale, exchange, or disposition of securities within this state by requiring the registration of certain securities and transactions. People v Dempster, 396 Mich 700, 704; 242 NW2d 381 (1976). Its purpose "is to prevent stockholders and promoters from perpetrating frauds and impositions on unsuspecting investors in hazardous undertakings and to protect credulous and incompetent persons from their own inclinations to speculate in hazardous enterprises.” People v Brecken ridge, 81 Mich App 6, 14-15; 263 NW2d 922 (1978), lv den 402 Mich 915 (1978). The act should be broadly construed to effectuate these purposes. Dempster, supra.
Under § 305(f)(2), the administrator of the Corporation and Securities Bureau may require, as a condition of registration by qualification, that the proceeds from the sale of a security be impounded:
"The administrator may by rule or order require as a condition of registration by qualification or coordination:
"(2) That the proceeds from the sale of the registered security in this state be impounded until the issuer receives a specified amount from the sale of the security either in this state or elsewhere. The administrator may by rule or order determine the conditions of any * * * impounding required hereunder.” MCL 451.705(f)(2); MSA 19.776(305)(f)(2). (Emphasis added.)
The purpose of this provision is to ensure that the issuer has sold a significant portion of the securities offered and has raised sufficient financial resources before the project is commenced and the proceeds of the sale expended.
However, § 305(f)(2) only authorizes the administrator to impound proceeds until the issuer receives a specified amount. The administrator may impose additional conditions on such impoundments, but he cannot attach conditions which are intended to become operative after the issuer receives the specified amount of proceeds. Stated another way, the bureau cannot require continued impoundment after the issuer has satisfactorily shown that he has deposited the requisite amount of proceeds in escrow and otherwise complied with the securities act.
Section 412(a) of the act authorizes the adminis trator to make such rules and orders as are necessary to carry out the provisions of the act. MCL 451.812(a); MSA 19.776(412)(a). Pursuant to this rule-making authority, rule 705.3 was promulgated:
"(1) As a condition to registration by qualification or coordination, the administrator may require that the proceeds from the sale of the registered security in this state be impounded until the issuer receives a specified amount from the sale of the security in this state or elsewhere, sufficient to accomplish the purposes of the offering, or until certain stipulated requirements are met.
"(2) In a new promotional enterprise, the administrator will ordinarily require that 100% of the sales price be impounded and that the 100% be returned to investors entitled thereto upon order of the administrator in case of failure to raise the specified amount within 1 year or during the effectiveness of the registration, or if certain stipulated requirements are not met. In such case, the promoters will be required, by equity investment or otherwise in a manner satisfactory to the administrator, to defray the discount, commission and expenses of the public offering including the expense of the impoundment and possible refunds. Consideration will be given to reduction of this percentage to defray some or all of the public offering costs in any instance of an enterprise with reduced promotional remuneration and advantages. No funds may be released except upon order of the administrator and all funds may be subject to audit before release.
"(4) A request for the release of impounded funds when requirements are met shall be by petition in writing affirming compliance with the registration and shall be accompanied by a statement from the depositary setting forth the total amount on deposit.” 1979 AC, R 451.705.3. (Emphasis added.)
This rule differs significantly from § 305(f)(2). Under subsection (1) of rule 705.3, impoundment may be imposed and continued until certain stipulated conditions are met, even if the specified amount of proceeds have been properly deposited in escrow. Furthermore, under subsection (2), the administrator may require the issuer to return the sales price to the investors of a new promotional enterprise for failure to meet the stipulated conditions, even if 100% of the sales price has been impounded. When either of these situations occur, the power granted to the administrator by rule 705.3 clearly exceeds the power granted by § 305(f)(2) of the securities act.
The administrator may include stipulated reqúirements as conditions of the impoundment as long as they are intended to operate before the specified amount is collected. However, the stipulations cannot authorize continued impoundment or return of the proceeds once the issuer sufficiently demonstrates that he has deposited the requisite amount and otherwise complied with the securities act.
The intervening defendants claim that the April 16, 1973, order incorporated by reference the disbursement schedule contained in the escrow agreement. Assuming arguendo that this is true, the Corporation and Securities Bureau did not have the power to include or enforce any of the conditions precedent to the release of the installments. The bureau properly included such conditions as the percentage of proceeds that had to be impounded and how the proceeds could be invested by the escrow agent during impoundment. These are typical examples of conditions which may be imposed under § 305(f)(2).
Ill
Although the bureau had no authority to include the disbursement schedule in its order or enforce it, final disbursement under Section 5(iii) of the original escrow agreement still could not have occurred until the initial closing of the permanent loan. In anticipation of the possibility that permanent financing could not be obtained, waivers of this disbursement condition were sought and obtained from intervening defendants. The validity of these purported waivers therefore remains. Intervening defendants present essentially three arguments: (1) the waiver was ineffective because material and relevant facts were insufficiently disclosed or concealed; (2) condition 5 of the April 16, 1973, order required prior bureau approval for any amendment; and (3) § 410(g) of the securities act voids any purported waiver by an investor of any provision of the act or any bureau rule or order.
We decline to decide whether disclosure was inadequate for two reasons. First, the bureau did not have jurisdiction to decide this fact question. The Uniform Securities Act, which the bureau is required to administer, is
"AN ACT to enact the uniform securities act relating to the issuance, offer, sale or purchase of securities and commodity contracts; to prohibit fraudulent practices in relation thereto; to establish civil and criminal penalties for violations of the act and civil penalties for violation of the rules promulgated pursuant to the act; to require the registration of broker-dealers and their principals, agents, investment advisers, commodity issuers, and securities; to make uniform the law with reference thereto; and to repeal certain acts and parts of acts.” (Emphasis added.)
The attempted amendment of the disbursement schedule subsequent to the sale of the limited partnership interests was totally unrelated to the issuance, offer, sale, or purchase of these interests. Intervening defendants have never alleged fraud in the issuance, offer, sale, or purchase of the securities, and it is undisputed that they were properly registered and sold. The bureau, by deciding the waiver issue, has in effect treated this case as a continuing sale and purchase. The Legislature never intended that the bureau be involved, under the guise of the securities act, in the internal affairs of a corporation or partnership once the sale of securities has been successfully and properly completed. Blue sky laws are not intended to protect investors from financial loss in general, but from fraud which may lead to such financial loss. 69 Am Jur 2d, Securities Regulation — State, § 1, p 1060. See also Merrick v NW Halsey & Co, 242 US 568, 587-588; 37 S Ct 227; 61 L Ed 498 (1917).
Second, the parties were prevented from litigating all of their equitable and legal arguments concerning the validity of the waiver. The hearing officer correctly ruled that creditor claims were outside the scope of this case and beyond his jurisdiction to decide. He limited his decision to whether the waiver was valid under the securities act and the related regulations. This prevented the parties from raising the estoppel arguments and statutory defenses which they subsequently asserted on appeal. These arguments could not have been properly decided by the Ingham Circuit Court since its jurisdiction was limited to an appellate review of the bureau’s decision. MCL 451.811; MSA 19.776(411). In fact, the circuit court specifically denied intervening defendants’ motion to offer additional evidence on these claims. Since these claims may be dispositive, the record is inadequate, and no lower court has ruled on the merits, we cannot decide them._
We briefly address the remaining issues since they do not involve questions of fact, they were fully litigated below, and they may reoccur during future proceedings.
Condition 5 of the bureau’s order provides:
"None of the securities shall be offered and sold except in accordance with the terms of this order and the registration statement without first securing amendment of the order or the written permission of the Bureau. Before executing any agreements or before finalizing and putting into effect any proposed changes, requirements of the Bureau shall be ascertained and compliance effected therewith.”
This condition only requires bureau approval of changes which will be made while the securities are being offered and sold.
Section 410(g) of the act provides:
"Any condition, stipulation, or provision binding any person acquiring any security or commodity contract to waive compliance with any provision of this act or any rule or order hereunder is void.” MCL 451.810(g); MSA 19.776(410)(g).
The attempted amendment of § 8.5 of the partnership agreement did not violate this section. The amendment did not purport to waive compliance with any statutory, regulatory or order provision. Since the disbursement schedule of the escrow agreement should not have been incorporated in the bureau’s order, the amendment could not have conflicted with the bureau’s rules or order.
IV
The decision of the Court of Appeals is reversed and the case remanded to the Corporation and Securities Bureau for dismissal of plaintiffs’ peti tion. The parties may institute further proceedings in the appropriate forum concerning those issues not resolved by this decision. We do not retain jurisdiction.
Kavanagh, Levin, Ryan, Brickley, and Boyle, JJ., concurred with Cavanagh, J.
Intervening plaintiffs Burton Abstract and Title Company and St. Paul Title Insurance Company paid these debts and therefore claim an interest in the escrowed funds as assignees and subrogees. Plaintiff Westinghouse supplied the appliances used to complete the project, but apparently was reimbursed by Burton Abstract.
To ensure that the issuer has sufficiently complied with the bureau’s order and the securities act, the bureau properly requires under rule 705.3 that the request for release be in writing and accompanied by a statement from the depositary setting forth the total amount on deposit. The requirement that the bureau issue a release order also serves this purpose.
Nothing in this opinion is intended to limit the Corporation and Securities Bureau from subsequently issuing a stop order denying effectiveness to, or suspending or revoking the effectiveness of, any registration statement under § 306 of the securities act. MCL 451.706; MSA 19.776(306).
It is debatable whether the disbursement schedule was incorporated in the order. Paragraph 5 of the escrow agreement stated that the escrow agent was required to hold the deposits until the Commerce Department ordered their release. Following that release, the agent thereafter was to disburse the funds upon request of the underwriter (FSC) when certain events occurred. None of these events required that the bureau issue an order to the escrow agent to release the funds. Condition 5(i) merely stated that once the underwriter complied with the bureau’s impoundment order (i.e., deposited all the proceeds in escrow), the first installment would be released. We decline to decide this point, however, since it is unnecessary to the resolution of this casé.
Although condition 5(i) merely stated that the first installment would be released once the impoundment order was complied with, only a $417,000 disbursement was permitted. Under this decision, the bureau must release all of the proceeds once the issuer sufficiently demonstrates that he has deposited the specified amount in escrow and otherwise complied with the securities act.
Thus, this is not an action to recover the purchase price of the securities under § 410. MCL 451.810; MSA 19.776(410). Note that none of the impoundment conditions purportedly imposed pursuant to § 305(f)(2) were violated since the escrow agent never released the funds.
Many of the parties to this appeal are litigants in several other contract and lien foreclosure actions which have been filed in state and federal courts. Apparently, these proceedings have been stayed pending resolution of this appeal. The sole purpose of this case is to determine who is entitled to the impounded funds under the escrow agreement, limited partnership agreement, and the purported amendment thereof.
Schwaemmle argued that even if the waivers were not valid, it was still entitled to the escrowed funds on the grounds of promissory and equitable estoppel. Specifically, Schwaemmle maintained that it agreed to complete construction only because FSC and Kelly Mortgage assured that its $75,000 fee would come from the escrowed funds. The limited partners countered that Schwaemmle’s claim was barred because it did not have a builder’s license, as required by MCL 338.1516; MSA 18.86(116) (now MCL 339.2412; MSA 18.425[2412]): | [
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Campbell, J.
Relator, as tinder-sheriff of Mecosta county y asks a mandamus to compel the allowance of part of an account rejected by respondents. It is not claimed that the whole bill was not considered, but the complaint is of the rejection of some items, and the deduction of some moneys previously paid to him from the amount otherwise due and recognized. It is also claimed that some charges and restatements were made after he had been heard, and without an opportunity for further hearing.
' This last suggestion is not in our view admissible. It appears that relator had an opportunity of being heard, and was heard upon his whole' claim. It does not appear that any testimony was afterwards submitted against him. We cannot, therefore, hold that he was deprived of the opportunity of showing any right which he had, and the supervisors cannot be restrained as to their methods of business' which shut out no such opportunity.
The excluded items called to our notice are a charge of ten cents per mile for bringing back certain goods on a search-warrant, (a similar amount having been allowed for service of the writ and travelling to the place of service, 93 miles,) and a further series of charges for a daily allowance of $2.50 for attending court.
As no statute has been palled to our attention by relator,, fixing charges for such services as were rendered in regard to removing the goods in question, we assume that our diligence will not find any. In the absence of a statute the board .cannot be compelled to make the allowance claimed.
In the case of the charges for attendance on the court the record does not show that any court certificate or other determination of the fact of relator’s attendance was produced. It further appears that the board looked into the facts and did not think the services had been rendered as claimed, or at any rate had been fully rendered. The relator’s petition contains no such averment. W e cannot hold the supervisors in fault without a distinct showing of something which they had no right to determine as they did. We cannot tell from this record that any particular charges have been improperly thrown out. They certainly had a right —as the record stands — to inquire into the facts.
But it is proper to refer to one consideration that apparently entered into the action of the board. They point out that in one case where a charge was made for attendance, relator was earning money for services of a different nature incompatible with such attendance. While it may be true that an officer will not be held to lose his per diem by not being for every moment of the day in court or doing business relating to the session, yet we do not think the statute was designed to pay sheriffs or deputies when their attendance is merely colorable, and when in fact they are occupied most of the time elsewhere. There has been much abuse practiced in making constructive charges, and we do not think supei’visors can be censured for scrutinizing such charges with some care. Every reasonable allowance should be made for services which have been substantially, though not literally, performed. But this is all that should be exacted. And when the court itself does not certify to the officer’s attendance in court, the facts must be open to inquiry.
The principal dispute arises out of a peculiar practice, by which the supervisors provided that the sheriff might draw periodically from the county treasurer the amount of his actual expenses, leaving the rest of his account for future audit. A considerable sum was so drawn, but tlie board, when the accounts were finally audited, refused to allow credit for some of these expenses and deducted the treasurer’s payments to that extent from what would otherwise have been coming to relator.
We think their course was proper. The board of supervisors have no right to delegate the auditing of accounts to the treasurer, and we do not suppose they meant to. They certainly ran some risk in allowing moneys to be drawn in advance of credit, but they probably understood that under the restrictions imposed there would be no ultimate overdraft. It was their duty before balancing the accounts, to see that relator received no more than was justly receivable. It is not now shown that the moneys charged back were for services or outlays which they could not question.
We think no case is made out for a mandamus, and it must be denied with costs.
The other Justices concurred. | [
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Cooley, C. J.
This is an action for personal injuries alleged to have been caused by the driver of the defendant negligently causing his car to run against the vehicle of the plaintiff, as he was driving along one of the streets of Detroit.
The plaintiff was sworn as a witness in his own behalf, and he also called the driver as his witness. After hearing both stories the circuit judge ruled that there was nothiug to go to the jury, and directed a verdict for the defendant. The plaintiff brings error.
According to the plaintiff’s story he was driving a -one-horse vehicle along the street on one side of the defendant’s tracks when he encountered obstructions and turned towards the tracks so that his right-hand wheels were over the rails. He did not look behind him to see if a car was coming until he felt something strike the rear wheel. He then looked around and saw it was the street car, and the driver, as he says,
“motioned me with one hand to go on or he would knock a wheel off me. I laughed at him and said, ‘ You better not knock off more than one or two of them or somebody will have to pay for them.’ He kept on motioning to get out •of the way. I told him I could not get over those wagons, and I was not going to try, but I would get out of his way just as soon as ever I could. I kept on. There was a number of wagons standing on that side of the street, loaded with brick, and three or four or five of them with the rear ends of the wagon out on the street further than the fore end, which brought the rear end of these wagons very near the car track, so that I had to get with'the wheels oil •the right-hand side of my wagon partially onto the track, and some places it got off the track, and some places I had to get right out pretty well over the track.”
Up to this point the plaintiff was not only in fault, but he was the only party in fault. He had driven upon the track in front of an approaching car without looking around until the car had come m collision with his vehicle. This was gross carelessness on his part. But further on his evidence shows that the other side of the track was entirely •unobstructed, and that there was nothing to prevent his crossing at once and allowing the street car to proceed on its way. The car had come to a stand-still on the first collision, and the plaintiff’s conduct in maintaining his ground and responding to the driver’s request that he should get out of the way by a laugh and a threat, was not only a wrong to the defendant but also to any persons who might then be riding in the car or awaiting its coming.
But the plaintiff further 'testified that as he was leaving: the track the driver called out: “ God damn you, I can smash you anyhow,” and that he let go the brake and the car almost instantly struck the plaintiff’s wagon and threw it over, inflicting the injury complained of. The inference from this might be that the driver purposely and in the anger excited by their altercation, ran his car against the plaintiff’s wagon; and if the action had been brought for the trespass, it might become necessary to decide whether under cases like Wright v. Wilcox 19 Wend. 343 the defendant would be responsible. In that case it was decided that where the servant wilfully drove his master’s conveyance over a third person and injured him, the trespass was that, of the servant, for which the master was not liable. The case was followed in Richmond Turnpike Co. v. Vanderbilt 1 Hill 480: s. c. in error, 2 N. Y. 479, where the master of a vessel had purposely run the vessel into another; and in Illinois Cent. R. R. Co. v. Downey 18 Ill. 259, where the engineer upon a railroad purposely run his engine over livestock. Also in DeCamp v. Railroad Co. 12 Iowa 348, and many other cases. The general principle that the master is not liable for his servant’s trespasses is familiar, and was recognized by this Court in Chicago &c. Ry. Co. v. Bayfield 37 Mich. 205. And if it were important to determine whether the injury was one purposely inflicted and not one resulting from carelessness, the question would no doubt be one to be submitted to the jury. Rounds v. Delaware, &c. R. R. Co. 64 N. Y. 129.
But this is an action in case, and the ground on which it is sought to charge the defendant is that its servant negligently drove the car against the plaintiff’s vehicle. We are then to see whether, if negligence on the part of the driver is made out, or there is any evidence tending to prove it, the plaintiff himself, on his own evidence, does not appear to have been at least equally negligent. And we think lie-does. He knew very well he was in the driver’s way, and he had had ample time and opportunity to get out of danger if so disposed. That he was not disposed to allow the car to go on until it suited liis pleasure to do so, is quite apparent ; and there is abundant reason in his evidence for believing that he was purposely annoying the driver and delaying the car. If so, he cannot complain of the consequences.
The driver’s testimony is quite different from the plaintiff’s. He testified that when he first signalled' the plaintiff to get off the track, the plaintiff made no effort to do so. The driver told him to get off or he would be run into, and he replied,.‘Kun and be damned; he had as much right to the track as the driver had, and would get off when he pleased.’ He drove right along on the track, looking back and scolding the driver. Finally he turned off, and the car moved on, but he almost immediately turned again towards the track sufficiently to be struck by the car. If this evidence is true the contributory negligence of the plaintiff was plain and very gross, and he must bear the consequences. Whether, therefore, we believe the plaintiff or the driver, the ruling of the circuit judge was well warranted.
The judgment must be affirmed with costs.
The other Justices concurred | [
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Campbell, J.
Complainants were defendant^, as mortgagors, in a foreclosure suit wherein defendant Burt was complainant, and the other parties, except Bassett, defendants. Decree was made and sale had and confirmed, Bassett being purchaser. On appeal from this confirmation the sale was held valid. Leave was afterwards granted to file a bill of review, on the ground that Bassett was alleged to be in collusion with complainant, and not a bona fide purchaser, and that the sale ought not to have been ordered so early. 49 Mich. 462. The bill of review was filed, making Bassett a defendant with the rest, and not requiring a sworn answer. He put in a sworn plea of bona fide purchase. Complainants, instead of replying, set it down for hearing, and it was overruled, and a decree made setting aside the sale, from which Bassett appealed.
This bill, which goes somewhat further than an ordinary bill of review, does not appear from the record to have been accompanied by any adequate security, and contains no offer either to redeem the mortgage sale or to procure a higher bidder. How far these deficiencies would operate if objected to formally we need not consider, but we cannot in examining the general merits overlook the fact that the only ground for allowing the bill after the time for appealing had expired, was that the property had been sold at a great sacrifice to a person who really represented the complainant.
Mr. Bassett’s plea was neither more nor less than a simple denial of the main issue presented by the bill of review. It was regular in form and positive in substance. Upon what theory such a plea was held insufficient we cannot imagine. It had been already decided by this Court that the sale was regular and valid on its face. This being so, the only possible issue as to Bassett was his good faith. If this was to be disputed the plea should have been replied to and the facts investigated. Instead of this the plea was set down for hearing — a proceeding equivalent in its nature to a demurrer. Had the practice permitted a demurrer in form it would have been so plainly frivolous as to entitle the party to final judgment without further pleading. Inasmuch as the complainants have continued to enjoy the possession of the property without adequate security, it is "evident that delay is greatly to their advantage, and to the disadvantage of Bassett, and should not have been allowed.
The court not only overruled the plea, but set aside the sale, which it had no right to do under the practice, but which seems to have been acquiesced in by both parties to bring the controversy to an end.
In view of the state of the record, we feel bound not only to reverse the decree but to dismiss the bill, inasmuch as complainants took no steps to facilitate the inquiry into facts and made no offers and took no steps to obviate the evil of delays. As the case stands it presents no grounds for further indulgence.
The other Justices concurred. | [
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] |
Cooley, C. J.
This suit was once before in this Court, and the decision upon the questions then raised is reported in 50 Mich. 379. The case has been re-tried and a judgment rendered for the plaintiff, upon which the defendants again bring error.
The action was for the recovery of the price or value of timber sold by plaintiff to be delivered to defendants at St. Ignace. The terms of the sale were in writing, and the contract specified that the timber should be subject to inspection by the inspector of the Detroit, Mackinaw & Marquette Railroad Company. The timber was cut in the woods at some distance from St. Ignace, and sent forward by rail, and the pai’ties were in controversy respecting the amount received by the defendants.
The declaration contained counts on the contract, and also the common counts. The court required the plaintiff to elect whether he would proceed on the special counts or on the. common counts, and he first elected to proceed on the special counts, but afterwards, and before the case went to the jury, was permitted to change this election, and to ask for judgment on the common counts. This permission is complained of; and it certainly seems to have been a very liberal exercise of judicial discretion. IJnder the circumstances of this case, however, we cannot think the defendants were injured or embarrassed by it. The case was such that, whether recovery was asked on the special or the general counts, the same facts had to be relied upon by the plaintiff, and the same defense made. We think there was no legal error in this ruling.
The plaintiff, in making proof of the amount of his timber received by the defendants, called the inspector of the railroad company, who testified that he inspected the timber received at St. Ignace, and that a certain quantity which he specified passed inspection, while a large quantity was rejected. It appears from his testimony that timber was used by defendants before inspection ; and this was not only a method of dealing with the property which was not contemplated by the contract, but also one very well calculated to raise doubts and create difficulties in making proof of the amount for which defendants should be held accountable. It also appears that defendants made use of considerable timber which had been rejected by the inspector. Plaintiff claimed that there was delivered of his timber at St. Ignace for defendants, 25,394 feet, and that the whole amount, less 2889 feet, was used or made away with by them. In making out his case he was allowed, against the objection of defendants, to testify that he put the quantity of timber first mentioned on the cars to be sent forward to St. Ignace. This, it is very truly said, did not show that the defendants received all that was thus put upon the cars; but it might be-a necessary step in making such showing. The difficulty in getting at the exact facts on this branch of the case was chargeable, in part at least, to the loose manner in which the business was done; and for this the defendants and their agents were largely chargeable. The plaintiff was not to be shut off by this difficulty from showing how much -of his timber the defendants had received, and he must get at the facts as best he could under the circumstances. If he failed to trace the timber 'from the woods to defendants, it is to be supposed the defendants would be able to point out the failure to the jury; but they were not entitled to shut out an item of evidence, which might be an important part of a complete showing, because of its incompleteness or futility by itself.
The judge in submitting the case to the jury instructed them that defendants should be charged for the timber which passed inspection, at the contract price, and for all other timber which they toot and used, at its market value. This instruction was correct. If defendants appropriated any of plaintiff’s property otherwise than according to the terms of the contract, their liability must be determined irrespective of the contract. The charge of the judge seems to have been in all respects fair, and though a large number of exceptions were 'taken, we do not discover any plain error, or an}Tthing further in the case which calls for discussion.
The judgment will be affirmed.
The other Justices concurred. | [
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] |
Sherwood, J.
This action was brought on a bond filed on taking an appeal under Comp. L. § 5180 [How. St. § 6738] from a decree in a foreclosure suit wherein Sewall S. Yauglm was complainant, and Dwight Nims and Ann W. Nims, his wife, were defendants. The penalty of the bond was $200, and the condition was in the following language:
“If said Dwight Nims and Ann W. Nims shall pay, satisfy or perform the decree or final order of the Supreme Court in said cause, and shall pay all costs in case the decree of the said circuit court in chancery shall be affirmed, then this obligation to be null and void.”
The statute requirements of the bond are as follows:
“The appellant shall, within forty daj7s, file with the register or clerk who entered such decree or' order, a bond to the appellee, with sufficient sureties, to be approved by a judge of the circuit court or a circuit court commissioner, and in such sum as such judge or commissioner shall direct, conditioned to pay, satisfy or perform the decree or final order of the Supreme Court, and to pay all costs in case the decree or order of the circuit court in chancery shall be affirmed.”
The case was originally brought before a justice of the peace, tried, and judgment rendered for the plaintiff. From this judgment an appeal was' taken to the Kent county circuit, where it was tried before Judge Hoyt, without a jury, and the plaintiff again had judgment, which was set aside on motion of defendants, and the cause was retried at the circuit before his honor, Judge Montgomery, without a jury. Plaintiff again had judgment for the sum of $160, that being the amount of the penalty in the bond, less the amount tendered by Nims and left with the court. Defendants bring error.
The case is before us on special findings of fact and of law, and the only error assigned is that “ the conclusion of law is not supported by the facts.”
From the findings of facts it appears that the decree in the case appealed, and in which the bond was given, was affirmed with costs in the Supreme Court; that under the decree appealed from, and which was so affirmed, a sale of the mortgaged premises was had on the 11th day of April, 1879, and from the report of sale it appears that the costs of such sale and the commissioner’s fees, together with the complainant’s costs at the circuit, were paid out of the proceeds of the sale; but the costs of the Supreme Court, taxed at $34.75, and the deficit on sale of the mortgaged property of $2438.76, were not paid, and could not be obtained after demand made therefor of the parties personally liable for the same under the decree.
The single question presented in this record is, Were the sureties in the appeal bond liable for anything beyond the amount of the costs taxed in the Supreme Court ? — the costs in the circuit court having been paid, and no damages having been assessed, by way of penalty, on the appeal. The decision at the circuit was for the increased liability.
The question presented involves the construction of section 144 of the statute above given. It was decided in the case of Kephart v. Farmers' & Mechanics' Bank of Michigan 4 Mich. 602, that it was not intended by the statute to require the appellant to oblige himself to the performance of the decree of the Supreme Court in all its parts, whether he was bound to that extent or not in the order or decree below, but only to the performance of .it in those particulars wherein he was individually bound by the decree appealed from. The appellant in that case was a second mortgagee who had been made a party defendant, but who was not liable for the indebtedness upon the first mortgage or any part thereof.
In the case of Daly v. Litchfield 11 Mich. 497, Mr. Justice Christiancy said: “We see no reason to doubt that the condition of the appeal bond (required by the statute) extends as well to the payment of costs decreed and taxed to the appellee in the court below as to those in this Court. The condition of the bond is, £to pay all costs in case the decree or order of the circuit court in chancery shall be affirmed.’ ” In this case the decree was affirmed. In Prosser v. Whitney 46 Mich. 407, this Court held that when the decree at the circuit was affirmed the costs made in the case previous to decree in the court of chancery are, equally with the costs in this Court, within the condition of the appeal bond. The statute requiring this construction re .gards the defendant as all the time in fault in making his contest when the decision is against him in the circuit, and will not allow him to take his appeal until he has made sure all costs incurred in making the contest, in case of affirmance.
In the case of Omaha Hotel Company v. Kountze, 107 U. S. 378, in an action upon an appeal bond, given on an appeal from the decree in a foreclosure suit under a statutory condition “that the appellant shall prosecute his appeal to effect, and, if he fail to make his plea good, shall answer all damages and costs where the writ is a supersedeas, or all costs only where it is not a supersedeas,” it was held: “ if the bond is to be regarded as importing nothing more than the bond prescribed by the statute, it is clear that it did not operate as security for the original decree.”
The object of the bond is to save all the rights of the appellee, without prejudice or diminution during the pendency of the appeal, and at the same time to prevent frivolous, vexatious and unnecessary appeals. It is not intended as an additional security for the original indebtedness of the delinquent party, but as an indemnity to the appellee against further trouble, expense and costs while the case is undergoing a review in this Court to ascertain whether or not error has been committed or injustice done the appellant by the decree of the court below. I do not think that under the findings in this case the surety in the appeal bond is liable for any portion of the deficit in the mortgage indebtedness.
The costs in the circuit were paid from the moneys realized from the sale of the property under the decree; and when this suit was brought the surety tendered the costs of this Court and the expenses of the suit to that time. This discharged his liability upon the bond. The tender was no admission of the amount claimed, but of an indebtedness to the amount he was actually liable for. The complainant received the amount tendered after the appeal to the circuit court was taken. I do not think the judgment is supported by the facts found by the circuit judge.
The judgment must be reversed, and a judgment entered for the defendant with costs of both courts.
The other Justices concurred. - | [
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Cooley, C. J.
Tlie defendant'was proceeded against as-garnishee of James O. Gibbs. The proceedings in the case-are given in the preceding opinion. The circuit judge was quite right in dismissing the garnishee proceeding when; the plaintiff *had failed to secure service upon the principal defendant within the statutory period. Noble v. Bourke, 44 Mich. 194. Whatever the plaintiff might do to keep the suit against the principal defendant alive for the purposes of a personal " judgment, did not concern the garnishee ; the proceeding against him was purely statutory, and his hands were tied and his action restrained for the time only that the statute provided for such service on the principal debtor as was necessary to enable the plaintiff to reach the credits and effects in the hands of the garnishee. The two proceedings are by no means indissolubly associated.
The judgment must be affirmed.
The other Justices concurred. | [
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] |
Sherwood, J.
This was an action of trespass, brought before a justice of the peace under the provisions of chapter VI of Act No. 243 of the Session Laws of 1881, to recover the penalty named in the second section of that chapter for failure to remove certain fences alleged to be encroachments upon a highway.
This chapter provides for the recovery of the penalty in cases of encroachment only, and the case sought to be proved on the tx-ial was one of obstruction, in which, under the facts stated upon this record, the justice had no jurisdiction.
The distinction here stated was recognized and enforced by this Court in a case which arose under the city ordinances of Grand Kapids as early as 1866, in which Mr. Jixstice Cooley, in delivering the opinion of the Coxxrt, said: “ Oxxr laws have always made a distinction between cumbering or obstructing a public way, and encroaching upon it. The former term has been applied to impediments to travel and passage placed in the open street, and tending to make its use difficult or dangerous; while the latter has embraced the actual enclosure of a portion of the street by fences or walks, or occupation by buildings. The mode of dealing with the two offences has almost always been different, and the penalties also.” City of Grand Rapids v. Hughes 15 Mich. 54.
The penalty under the statute invoked in aid of the plaintiff’s cause for obsti’ucting the highway is twenty-five dollars for each offense, while that for encroachment is fifty cents per day.
"We are all satisfied with the exposition of the law as given by Mr. Justice Cooley in the case cited, and the judgment must be reversed with costs.
The other Justices concurred. | [
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] |
Cooley, J.
This suit was instituted for breach of promise, of marriage. The plaintiff recovered judgment, which is now brought here by writ of error.
The promise is alleged to have been made in 1878 while plaintiff was residing with her father in California. The father testified on her behalf that early in January, 1879, the defendant came to him and, after remarking that he supposed his attentions to the plaintiff must be known to the witness, went on to say that he had her consent to become his wife, and now desired the consent of her father. The consent was given, and defendant said he should go to Michigan in a few days to attend to business, but would return in the following May, and remain until just before Christmas, and would then take plaintiff back as his wife to spend the holidays with his folks. The witness was then asked whether from that time he observed whether the defendant and the plaintiff conducted themselves towards each other as though they were engaged to be married. This was objected to, but the objection was overruled and he answered that they did.
The objection to such evidence is said to be that it submits to the jury the conclusions of the witness upon the facts, instead of giving them the facts thems.elves from which it is to be supposed they are as competent to draw conclusions as the witness is. Leckey v. Bloser 21 Penn. St. 407. Here the fact to be proved was the mutual promise, and we agree with counsel for defendant that this ought to be made out on better evidence than the surmises and conclusions of witnesses, based upon what they observed of mutual behavior. It is not their province to draw deductions from the facts, but they must submit the facts to the tribunal appointed by law to judge of them. But in this case we have something more than the deductions of the witness. His evidence upon the main issue was very important and very positive, and what he said about conduct did not so much tend to prove a promise — for which, indeed, it was not needed if his other evidence was believed — as to show that after the promise the defendant trifled with the plaintiff’s affections. The witness was not inferring a promise from conduct, but he was noting the conduct in the light of the promise which had been disclosed to him; and in connection with his other evidence we cannot say there was error in permiting him to answer the question put to him.
The court also permitted the plaintiff to put in evidence letters which she had written to the defendant before, as she claimed, he had done anything to terminate the engagement. This was entirely proper. The defendant might •have put the replies in evidence had he seen fit to do so.
The plaintiff was also suffered, in answer to the question whether she had any property of her own, to say that she had none. Pennsylvania Co. v. Roy 102 U. S. 451, is relied upon as authority against this evidence. The suit in that case was brought to recover damages for a personal injury, •and the court very properly held that these damages did not at all depend upon the wealth or poverty of the plaintiff. But when the suit is for the loss of a marriage and of an expected home, the fact that the plaintiff is without the means to provide an independent home for herself is not entirely unimportant. It may be supposed to be one of the facts which both parties had in mind in making their arrangements ; and it is not improper that the jury should know óf it also and take it into account in making up their verdict.
In his charge to the jury the judge told them they might take into consideration the length of time the engagement had continued between the parties. Exception was taken to this, but it was a very proper direction. He also told them that if they should find that the defendant wantonly5 willfully and causelessly broke the engagement, they might in their estimation of damages consider the injury to the plaintiff’s feelings and reputation, and any circumstances of indignity under which the wrong was done, and the consequent public disgrace to the plaintiff, together with any other circumstances belonging to the wrongful act tending to the plaintiff’s discomfort. This is complained •of as having no evidence to support it. But we do not think the case is entirely without evidence to justify sucha charge. The proofs tended to show that the engagement was made known to the lady’s immediate friends; that it was broken without cause or warning by a marriage with another, and that then the defendant denied ever making it. There were certainly in these facts circumstances of mortification, and their tendency was to bring the plaintiff into public disgrace. We find no error in this or in any of the other rulings complained of, and
The judgment must be affirmed with costs.
Graves, O. J. and Campbell, J. concurred. Sherwood, J. did not sit in this case. | [
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Campbell, J.
The probate court of Ottawa- county, upon application of Orleans L. Jordan and Hampden Kelsey, admitted to probate, on proof of foreign probate, the will of Thomas C. Brinsmade, deceased. Mrs. Brinsmade, his widow, was afterwards on a showing allowed to appeal from this order, which she claimed to have been made without sufficient cause and improperly. The appointment and probate were set aside by the circuit court, and Kelsey brought the case into this Court by writ of error.
There was no issue in the circuit court involving the validity of the will or of the New York probate, and the only questions .were, the propriety of the intervention of petitioners below, and of the appointment of Kelsey as administrator. It is now objected by appellee that the wrong remedy has been sought here, and this objection we regard as well taken.
It has been decided in this Court several times that a. writ of error is only allowable to bring up such controversies and questions as are according to the course of the common-law. Probate appeals sometimes involve such questions, where there is a contest over the will itself or over contested claims. In other cases they include equitable matters, as in case of accounting, and matters involving more or less discretion. Where no such issue is involved as could ever be a common-law question, the relief must be had by some other process, if it can be had at all. In Besancon v. Brownson 39 Mich. 388, a case like the present came up on certiorari. In Holbrook v. Cook 5 Mich. 225; Conrad v. Button 28 Mich. 365; Cameron v. Bentley 28 Mich. 520; Fletcher v. Clark 39 Mich. 374 and Gott v. Culp 45 Mich. 265 the varying character of probate appeals was considerably discussed and in some of them the proper mode of review was referred to. There was no question presented on which the intervention of a jury could have been a matter of right, and no common-law issue whatever.
The writ must be dismissed with costs.
Tiie other Justices concurred. | [
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Graves, C. J.
The complainant being the treasurer of the township of Raisinville, in the county of Monroe, was required to collect the taxes levied in 1881. He found upon the roll a distinct and special charge against each of the defendants Sortor, on account of a drain or ditch then recently made. They respectively refused payment, and he seized certain property of each to compel it. They sev erally denied liability upon the ground that the tax was illegal. But in order to save their property from sale, they paid under protest, and each brought his separate action against the complainant to recover back what he had paid.
Meanwhile, the defendant Tinsman had received an order from the township board against the share of liability which had been charged on defendant Hendrick Sortor, and the defendant Weilnau another order against the share of liability which had been charged on the defendants John and Justus Sortor respectively, and these orders being presented for payment were refused. This bill was then filed by complainant to compel the several defendants to “inter-plead and settle and adjust their said demands between themselves.”
The defendants Sortor put in separate answers, and severally alleged that the proceedings to lay out and establish the drain and assess the tax were invalid, and the assessments void. They also claimed the benefit of a demurrer. The defendants Tinsman and "Weilnau put in a joint and several answer, and insisted that they were entitled to payment of the orders, and that the proceedings to lay out and establish the drain were legal. The complainant filed a general replication, and the circuit judge proceeded to hear the matter on these pleadings, and he decreed that the bill was properly filed, and that the defendants should interplead and settle the matters in controversy between themselves, and he dismissed complainant with his costs to be paid out of the fund. The defendants Sortor appealed.
In considering the case under the form in which it now appears we are not to extend our views to any matters which are hot presented by the bill. Independent statements of fact in the answers are not to weigh in the present aspect of the suit, and if we accept the showing made by the bill, does it exhibit a case for the jurisdiction of interpleader ?
The exposition made by the bill is extremely meager. There is no explanation whatever of the origin of the claims which are supposed to conflict. The drain proceedings are not described, and no hint is suggested concerning the nature of the objections. We are not informed when the ditch wa’s established, nor when the work was performed, nor by whom, nor are we told what is claimed „on these points. Indeed, there is no mention even of the law under which the work was done and the contested charges imposed. We are informed by the brief of the learned counsel for complainant, that the proceedings were under the Township Drain Law of 1871, (Comp. L. p. 586.) But here there is nothing said about the amendments made in 1875. It is scarcely possible that they are irrelevant.
Now it is plainly essential to ascertain the relation of one to another of the claims brought against individuals on account of the construction of drains under the township law. That they possess a character peculiarly their own is very apparent. Dawson v. Aurelius Township 49 Mich. 479. The law provides for assigning to each parcel of land to be drained or benefited the construction and maintenance of a distinct and specified portion of the drain, and the share marked out as due from that identical parcel is made a lien on it and an “ obligation against the owner.’” In case he neglects to perform the allotment within a given time it becomes the duty of the drain commissioner to let the work to some one else, and on its performance to give a certificate to the contractor showing the amount and value and the description of the particular parcel of land against which the work is done. Unless the person whose allotment has been so worked pays the proper sum to the township treasurer and files a receipt with the clerk within a certain time, the clerk is to certify the item to the supervisor, who is required to levy it on the very land to which it applies. When collected, the sum is “received into the township treasury,” but not as township moneys. Dawson v. Aurelius Township supra. It can be paid out only to the person entitled to receive the same, on the order of the township board.
On examination of the statute it becomes clear that the charge against each parcel is a matter by itself, and that the money received on account of it composes a distinct fund not to be confounded with any other of the same class, even though pertaining to the same ditch or drain. In a general sense these levies all fall into one category, which may be called for convenience a “ditch tax” or “ditch fund.” But as between themselves they are separate and distinct. They are not capable of being blended into a common mass, and the money arising on one allotment cannot be appropriated on account of any other. Moreover, each may have its own peculiar questions of legality.
We may refer now to the relations which the defendants bear to each other and to the object of contention. There is no ground of controversy at all between the defendants Sortor. They are so many individuals separately setting up their several claims, neither of which has connection with any others or with any fund to which the others refer. Moreover, it does not appear that the same question is up in any two cases. So far as seen, each one may depend on a question peculiar to itself. No issue is possible between the defendants Sortor.
The same principle applies to the defendants Tinsman and Weilnau. As between them, there is no ground of contention. There is nothing on which to found an issue. How is it as between the Sorters, on the one hand, and Tins-man and Weilnau on the other? Tinsman has no concern with what is claimed by either John or Justus Sortor, and Weilnau has no interest in what is claimed by Hendrick Sortor, and there is no subject of controversy with which either of the Sorters has any business outside the matter of his own taxi The circumstance that Weilnau’s order covers the shares of both John and Justus Sortor has no operation to unite those persons as joint or co-parties for the purpose of a litigation with him. There is no theory on which it woxxld be possible to devise an issue with the Sorters as contestants on one side, and Tinsman and Weilnau on the other. It is not a case where one group of persons is arrayed against another in claiming a whole fund, nor a case where separate parts of a single fund are claimed by A., B. and C. against D., E. and E., nor is it a ease of promiscuous scramble either for the whole or for separate items of the same fund. There is no common fund to serve as a focus of conflicting interests. There may be similarity of questions, and that kind of common interest naturally arising from that circumstance, but that is not an interest in the subject of contention. '
The case in hand differs fundamentally from School District No. 1 of Grand Haven v. Weston 31 Mich. 85. There the complainant was in the situation of a trustee holding an entire sum by a title which no one disputed, and numerous parties were striving to get portions which in the aggregate very greatly exceeded the whole body of the fund. Their pursuit was on separate grounds of claim and by different methods; but the demands of all were against the same thing. The extent to which any ought to partake directly depended on the existence and magnitude of the rights variously set up, and all the controversies centered in the single fund. In this respect there was no diversity.
In the case before us, so far as we can gather from the bill, the state of things is different. There are several objects of controversy without any common interest. Suppose it to be admitted that the bill states transactions from which it would be possible to carve issues for interpleader. Even then it would be unavoidable to acknowledge at least three perfectly distinct grounds of contention. Three or more independent issues would be required to accommodate the conditions of hostility, and three unconnected litigations. They could not be intermingled in the same case. There would be certainly one issue between Hendrick Sortor and Tinsman, a second between "Weilnfu and John Sortor and a third between "Weilnau and Justus Sortor.
But even here a further difficulty appeal’s. The whole subject of controversy is only about $135, and neither of such issues would involve $100.
On the whole it appears impossible to discover any ground on which the bill can be supported. The brief of the learned counsel for complainant is very strong, but it cannot transform the actual transactions.
The decree should be reversed, and the bill dismissed with costs.
The other Justices concurred. | [
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] |
Sherwood, J.
The plaintiff brought ejectment to recover possession of 160 acres of land in the county of Tuscola, under a claim of title derived through a sale made upon execution issued on a judgment rendered against one Nathan Clifford for the sum of $500, in a suit against him by plaintiff for breach of promise to marry.
Plea general issue, with notice that at the time the levy and sale were made, Nathan Clifford had no right, title or interest in the land, legal or equitable, and that the sale by the sheriff, under which plaintiff claims title, was made more than one year before the commencement of the suit in this case. No question is made upon the pleadings as to the regularity of the sale. The judgment was rendered against Clifford on the 11th day of September, 1878; execution was issued thereon, and levy made thereunder on the 13th day of the same month upon the land in question; and on the 16th day of May, 1879, the land was sold by the sheriff, in pursuance of the levy, to the plaintiff, forthe sum of $125.
It appears from the record that Clifford held the title to the premises in question until the 26th day of March, 1878, when he conveyed them by warranty deed to the defendant Dean, for the expressed consideration of $2100, which deed was recorded on the 1th day of June, 1879.
This suit was commenced on the 27th day of February, 1883, and trial had on the 11th day of May following; and the plaintiff recovered. The plaintiff claims she derived title to the lands in question through the execution sale, and is now entitled to the possession on the ground that, as to her claim, the deed from Clifford and wife to Dean was void for want of consideration.
Several errors are alleged on the admission of testimony for plaintiff. The first and second assignments relate to the admission of the record and proceedings in the case of the plaintiff against Clifford, and those had upon the judgment after it was rendered, to and including the sale of the land by the sheriff and the giving of the bond in pursuance 'thereof. Ve think this was proper. It was necessary for the plaintiff to show a valid judgment and regular proceeding thereunder to sale. And if the deed from Clifford to Dean was void, as plaintiff maintains, these were sufficient to establish her claim to the possession of the property.
The third, fourth, fifth and sixth errors assigned relate to the testimony of witnesses Edson, Richardson and Wheat, offered to contradict Clifford; to show he had sworn differently on another trial from what he did in this. The plaintiff had a right to this testimony. The defendants had placed the witness upon the stand, and it was proper cross-examination for the purpose of impeachment, but it could only be used, after it was received, for that purpose. When Clifford was upon the stand, on his cross-examination, against the objection of defendants’ counsel that it was incompetent and immaterial, he was asked if he did not testify in the breach of promise case that “he conveyed the land in question to Dean, so that he could convey it back to his wife, and she could have the benefit of it,” and the witness answered substantially in the negative. The impeaching testimony above-referred to was then offered. And this is all the testimony there was in the case upon that subject, and the court charged the jury: “ If the deed was in fact given simply for the purpose of having Pean make a deed back to witness Clifford and his wife, for the purpose of having the property in different shape, and not for a consideration to be paid by Dean, it would be without consideration in law.” The court had previously told the jury that if this deed was without consideration, the plaintiff' would be entitled to recover. This charge of the court is excepted to by defendants, and error is assigned upon it, and we think the exception well taken. The charge fails-to restrict the effect of the impeaching testimony to impeachment only. It was left by the charge as establishing, or tending to establish, the main fact in the plaintiff’s case. This should not have been done. It was error. .Clifford was not a party to the suit, and only for its impeaching tendency the testimony would have been cleariy incompetent. Howard v. Patrick 38 Mich. 804 It would for any other purpose have been incompetent for another reason. Clifford’s statements, after Dean made his purchase and received his deed, would have been clearly hearsay and not binding upon Dean. Hedstrom v. Kingsbury 40 Mich. 637; Frankel v. Coots 41 Mich. 77.
The theory of plaintiff was that the deed from Clifford to Dean was, as to her, fraudulent and void, and did not affect her purchase of the 160 acres under the execution sale, for $125, and that all she had to do to entitle her to recover was to offer in evidence her judgment against Clifford and the proceedings thereunder to the sale, and the execution of the sheriff’s deed; the deed from Clifford and wife to Dean; and the fact that Clifford owned it when lie deeded it to Dean. The deed offered showed the consideration to be .$2400,which was admitted to be a fair valuation of the 160 .acres. The court, in his charge, substantially held that this was all that was necessary to entitle the plaintiff to recover. 'This was error.
The plaintiff’s right to recover rested upon the fraudulent transfer of Clifford’s property to the defendant Dean. It is nowhere in the record claimed or pretended that Dean, in making the purchase, had any fraudulent design at the time, or ever had notice of any fraudulent intent on the part of Clifford, in making the sale to him, to defraud the plaintiff. There was -nothing upon the face of the transaction or upon the face of the deed tending to show -fraud, as the facts appear in plaintiff’s testimony. It is true the conveyance was made to Dean by Clifford while a suit was pending against the latter upon a claim for unliquidated damages in an action for a wrong, but nothing further appears in the testimony of the plaintiff to show the fraud •charged. This would be the state of the case if the testimony of Clifford was disbelieved entirely. This, I think, we must all agree would be insufficient to entitle the plaintiff to recover. And as the court below told the jury that if they believed Clifford’s testimony, she certainly could not recover, it is difficult to see any good reason why, upon .all the evidence given in the case, (and we have it all in the record) the defendants’ sixth request might not have been very properly given, directing a verdict for the defendants.
It is very elementary that fraud cannot be presumed, but must be proved. Miller v. Finley 26 Mich. 249; Robert v. Morrin, 27 Mich. 306. The circuit judge held that the burden of proof, when the plaintiff rested, was upon the defendants to show consideration for the deed to Dean. The plaintiff’s proofs showed a consideration equal to a fair valuation of the land. If the jury believed Clifford’s testimony, a fair consideration was again proved; if they disbelieved him, the plaintiff’s proofs remained, still showing a consideration. Take either view, and it seems to us there was error in this portion of the charge. Darling v. Hurst 39 Mich. 768; Brigham v. Fawcett 42 Mich. 542; Pogodzinski v. Kruger 44 Mich. 79. The defendants’ fourth, fifth, and tenth requests were proper to be given to the jury.
The plaintiff in this case was not a creditor of the defendant when the conveyance to Dean was made, nor yet when the deed was recorded, and would not be until she had obtained her judgment against Clifford. Hill v. Bowman 35 Mich 191; Dusar v. Murgatroyd 1 Wash. 13.
It is unnecessary to discuss the case further.
The judgment must be reversed with costs and a new trial granted.
Graves, C. J. concurred. | [
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Sherwood, J.
In this ease it appears that in 1882 the plaintiff owed one Alfred Brunette about the sum of $1084.82. Brunette absconded February 2, 1882, leaving creditors. Defendant, being one of his creditors, on the 27th day of February, 1882, commenced suit by summons returnable March 8, 1882 before Byron D. Jones, a justice of tbe peace at Negaunee, to recover a claim against Brunette of $25.70. This summons was served by leaving a copy at Brunette’s last place of residence the same day? it being nine days before the retnrn-day. No personal service was made. On the retnrn-day another summons in continuation of the suit was issued by the justice, returnable on the 18th day of March, 1882, and was served on the 14th day of March, four days before the return-day thereof, by leaving a copy as before. No personal service of this summons was had.
On the 18th day of March the defendant took out a writ of attachment against Brunette in continuance of his suit, as he claimed, which was made returnable the 25th of March. The attachment was served on the return-day by leaving a copy at Brunette’s last place of residence. No personal service was had of the writ, nor was it levied upon any property.
On the return-day of the attachment the defendant Bahais caused the suit to be adjourned until the 24th of April, 1882; and on the adjourned day, M. H. Crocker, an attorney, appeared for Brunette before the magistrate, and judgment was rendered in favor of Bahais for $35.70 damages, and $6.50 costs of suit.
At the time of the commencement of the principal suit on the 27th day of February, 1882, garnishee proceedings were commenced against the plaintiff. A summons was issued at the suit of the defendant, returnable on the 8th day 'of March following, and was served on the cashier of the plaintiff.
On the return-day of the summons Ira A. Clark, a surveyor and wood and timber agent in the employ of the plaintiff, appeared and assumed to make a disclosure on its behalf. The garnishee proceeding was then, on motion of the defendant Bahais, continued until March 18. At this time there was no appearance for the plaintiff company.
The case was then adjourned until the 25th of March. No one then appeared for the company, and again on motion of Bahais, the proceedings were continued till April 24, 1882, at which time said Clark again appeared, being still in the employ of the company as such surveyor and agent, and again assumed to make another disclosure on behalf of the company. Thereupon the justice, without further summoning the company or taking any other proceedings, rendered judgment against the company as such garnishee of the said Brunette for $42.20 damages and costs. No appearance on the part of the company in any of these proceedings is claimed except that by Clark above stated.
Execution was issued upon the judgment thus rendered and levied upon certain property of the plaintiff to satisfy the same, on the 21st day of July, 1882, and the plaintiff brought replevin for the goods seized upon the execution. Trial was had before a justice, and judgment rendered October 14, 1882, for the defendant. On appeal to the circuit court for the county of Marquette on the 13th of August, 1883, a trial was had before the circuit judge without a jury, and judgment again given for the defendant, and the case is now before us for review on bill of exceptions containing all the testimony and findings of law and fact by the circuit judge.
All the proceedings in this case are special and statutory, and must be strictly construed. To entitle the defendant to the benefit he claims under them, he must show they are clearly within the provisions of the statute. Statutes of garnishment at best give a “ harsh and peculiar remedy,” and ought not to bo resorted to when the redress sought may be obtained through common-law proceedings. Thurston v. Prentiss, 1 Mich. 194; Maynards v. Cornwell 3 Mich. 309; Sievers v. Woodburn Barren Wheel Co. 43 Mich. 275; Weimeister v. Manville 44 Mich. 408.
The plaintiff must have a judgment against the principal defendant, or have commenced a suit against such principal defendant upon contract express or implied, or upon a judgment, before he can have process against a garnishee (How. St. § 8031); and before any judgment can be rendered against the garnishee he must have obtained judgment against the principal defendant (Id. § 8037 ;) and after judgment has been obtained against the principal defendant the garnishee is still entitled to his day in court to show cause, if he can, why judgment should not be rendered against him, and if he does not voluntarily appear and permit judgment to be taken against him, he must be brought in by summons from the justice. How. St. § 8038.
The record in this case shows that judgment was rendered against the plaintiff without its ever having been summoned to show cause against such proceedings and without any consent from it or its attorney. There is no "warrant in the law for such action by the court.
It'further appears from the record in this case that there was not any legal service, actual or substituted, of the process in the principal case. Clearly there was no legal service of any kind of either summons against the principal defendant. The only attempt at service, as returned by the officers, was by copy, and made several da3rs before the return-day in the one case, and the adjourned day in the other. This rendered the proceeding void, and gave the court no jurisdiction of the principal defendant. Smith v. Thompson Walk. Ch. 1; Stafford v. Hulbert Har. Ch. 435; King v. Harrington 14 Mich. 532-541; Nicolls v. Lawrence 30 Mich. 395; Town v. Tabor 34 Mich. 262; Withington v. Southworth 26 Mich. 381.
Whatever may have been the effect of the appearance of the principal defendant, as between him and the plaintiff in that suit, it is very certain such appearance could not have the effect to revive any void proceeding preceding it. At the-time Clark made his disclosure Lahais had no valid legal proceedings pending against Brunette. On the return-day of ‘the first summons against him no service of the process had been made, and the suit thus commenced went down for-the want of jurisdiction in the court to continue it by issuing further process.
The garnishee proceedings, being merely ancillary, went down with it and for the same reason. Laidlaw v. Morrow 44 Mich. 547. Such being the case the execution cannot be sustained upon which the property replevied was taken, and the plaintiffs should have had judgment at the circuit. Bigalow v. Barre 30 Mich. 1.
The previous decisions of this Court are. sufficient to determine all the questions raised upon this record, and their further discussion is unnecessary.
The judgment of the circuit court must be reversed with costs of all the courts and a new judgment entered for the plaintiff.
The other Justices concurred. | [
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Cooley, J.
The statute which defines the powers of school-district boards provides, among other things, that
“ They shall purchase or lease a site for a school-house, as shall have been designated by the district, in the corporate name thereof, and shall build, hire, or purchase such schoolhouse out of the fund provided for that purpose, and make sale of any site or other property of the district, when lawfully directed by the qualified voters at an annual or special meeting; provided, that the district shall not in any case build a stone or brick school-house upon any site, without having first obtained a title in fee to the same, or a lease for ninety-nine years ; and also that they shall not in any case build a frame school-house on any site for which they have not a title in fee, or a lease for fifty years, without securing the privilege of removing the said school-house when lawfully directed so to do by the qualified voters of the district, at-any annual or special meeting.” Comp. L. § 3629.
In September, 1867, the complainant in this suit was owner of a school-house and lot, and was in the occupation of the same, but the ground was low and needed drainage, and the question of procuring a new site for either temporary or permanent occupation was agitated among the voters. The place talked of for the purpose was on the land of the defendant, and some understanding with him concerning it appears to have been arrived at, but the parties do not agree what the understanding was. At the annual meeting held September 2, 1867, the meeting “voted to raise tax money sufficient to repair school-house and pay for a new site for the same, the amount to be ascertained and the job let by the following persons who were appointed a committee for that purpose by the moderator: D. S. Price, C. Iiaag and Philip Beal.” In January, 1868, the following instrument was executed by defendant and the members of the district board.
“Know all men by these presents that William E. Everett of the township of Delhi in the county of Ingham and State of Michigan, of the first part, for the consideration herein mentioned, does hereby lease unto school-district No. 5, in the township, county and State aforesaid, party of the second part and their assigns, the following parcel of land, to-wit: Commencing at a certain stake in the center of the Lansing & Eaton Bapids State Boad, running at a right angle of said road eight rods; thence parallel with said road ten rods; thence at a right angle with said road eight rods ; thence on the line with said road ten rods to the place of beginning,' — being on that portion of W. £ of S> W. •£ of section 5 lying east of the Lansing & E. B. State Boad in town 3 N. of range 2 W.; with all the privileges and appurtenances thereunto belonging, to have and to hold the same for and during the time it is used for school purposes. And the party of the second part, for themselves and their assigns, do covenant and agree to pay the said party of the first part for the said premises the sum of forty ($40) dollars, and to keep the said premises fenced in a good and substantial manner.
In testimony whereof the parties have hereunto set their hands and seals this ninth day of January, A. D. 1868.
Vm. E. Everett, Lessor [l. s.]
D. S. Price [l. s.]
( Bevenue Stamp, 50c. ) S. Drumm [l. s.)
< C. II. D., Begister. V Philip Beal [l. s.]
( March 4, 1868. ) District Board of School-district
No. 5 of the aforesaid Township.
Signed and sealed in the presence of Miles Gxllett,
’W. Drumm,
C. IIaag.”
The sum. named in this instrument was paid, and the district took possession of the land described, and has ever since been occupying it for school purposes. The instrument itself was-placed on record in the office of the register of deeds for the county.
In the year 1881, the district having in contemplation 4he erection of a stone or brick school-house on the lot described in the instrument above given, question was made whether the title conveyed was such as would warrant it; and it was claimed on behalf of the district that by the understanding when the instrument was given, a title in fee-simple was to have been and should have been conveyed. The officers accordingly called upon defendant and requested that he execute to the district either a deed in fee-simple or a lease for ninety-nine years. He refused to execute either, and denied that there was ever an understanding for any different instrument than the one which was executed and delivered. The present suit was then commenced. The purpose is to enforce the specific performance of the oral understanding alleged to have existed in January, 1868, and the bill alleges that by inadvertence a different instrument was then received by the officers of the district than the one bargained for.
The defendant answered, denying the equity of the bill, and proofs were taken. The affirmative showing on behalf of the complainant is very strong, but considerable evidence is put in by the defendant that in the negotiations with him he declined to convey an unqualified fee, and the instrument which he executed and which the school officers received and recorded must be considered as supporting very strongly the case made by the defense. On the whole we cannot say that complainant has established its case with sufficient certainty to justify a decree in its favor. This was the view taken of the case by the circuit judge, and his decree must stand affirmed with costs.
Another view might be taken which would lead to the same result. It is fully conceded by the defendant that the understanding was that the district should have the land so lóng as it should be occupied for school purposes; and the instrument which he gave shows this intent very conclusively. The instrument was therefore at the very least a lease in perpetuity at the will of the lessee. Folts v. Huntley 7 Wend. 210; Effinger v. Lewis 32 Penn. St. 367. But it was more than this. The grantee being a corporation, words of inheritance were not needed to convey a fee; and though the instrument given is spoken of as a lease, yet, as it was given for a present money consideration, it operated as a bargain and sale; Jackson v. Alexander 3 Johns. 484; s. c. 3 Amer. Dec. 517; Jackson v. Fish 10 Johns. 456; Feoffees &c. v. Andrews 8 Met. 584; Beach v. Haynes 12 Vt. 15; and it conveyed a base or determinable fee, which we think answers all the purposes of the statute. Arms v. Burt. 1 Vt. 303; s. c. 18 Amer. Dec. 680; Stevens v. Dewing 2 Vt. 411. The statute does not require a fee-simple; its purpose is to make sure that public school moneys shall not be expended in permanent buildings on land to which the district has a right which is less than a leasehold interest for ninety-nine years. In this case the right is perpetual, though subject to terminate by abandonment of school use.
Some question was made whether the new site had ever been legally designated by a vote of the school-district; but after this lapse of time no question of regularity in the designation could be tolerated. School-districts, unfortunately, are apt to act with great informality in their corporate matters; and it is a sound rule to let general acquiescence cover the errors.
The other Justices concurred. | [
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] |
Campbell, J.
Hatheway, as executor and residuary legatee of Gilbert Hatheway deceased, presented a claim against the late firm of Moore, Foote & Co., before the commissioners on Moore’s estate, under § 4438 of the Compiled Laws of 1871, [How. St. § 5906] authorizing proof of liabilities under joint contracts to be made against the estates of deceased joint contractors. The claim was rejected by the commissioners, and also on appeal, the circuit judge ruling that no case was made out. Error is now brought on the rulings at the circuit.
The case stands on the same footing with an action on joint contract, and the principal questionson the trialrelated to such a controversy. Moore, Foote & Co., consisting of Franklin Moore, George Foote and George Frederick Bagley, did business from 186é to 187é, having been associated originally under written articles for the purpose of becoming wholesale dealers in groceries and provisions, Bagley being the financial manager, Foote the general business manager, and Moore, the largest contributor, being exempt from personal management as far as he chose.
Gilbert Hatheway had dealings with the firm, and was in the habit of leaving considerable money balances in their hands, subject to his order, and drawing interest. He had also had at different times packages of bonds deposited specially in Detroit banks, which claimant relies on as indicating dealings with Moore, Foote & Co., under which they were liable as bailees. The present contest arises out of a claim that one or more packages of bonds were held by Moore, Foote & Co. for Gilbert Hatheway when he died, and have not been returned to his estate.
As the issue in the circuit is necessarily the same as before the commissioners, and was here, in fact, precisely the same without framing new allegations, the document filed with the commissioners, will determine the basis of the action. It was as follows:
“ To one or more packages of U. S. and Michigan State coupon bonds, deposited in the life-time of said Gilbert by him. with the late firm of Moore, Foote & Co., and remaining in the custody of said firm at the date of his death, Oct. ’71, not delivered to his executor nor to his order, nor to any one authorized to receive them. Yalue estimated $50,000.”
This claim is for a bailment by deposit of specific securi ties to be returned in the same shape as deposited. It is a simple and single form of liability as stated. And the only question presented is whether the firm as a firm ever received such a deposit to be re-delivered, and became legally in the wrong for non-delivery. The obligation relied upon is not a separate one of the decedent, but one which bound him, if at all, as a liability of the partnership on a partnership contract.
As the court helow held there was no testimony in support of the claim, some dates may become material. Gilbert Hatheway died in October, 1871, and appellant became his representative in December of that year.. Moore, Foote & Co. dissolved partnership in 1874. Both Moore and Bagley died in January, 1877. Foote is living.
There was no testimony tending to prove that Moore had any personal share in receiving or dealing with the bonds referred- to, or that he had knowledge of their reception. If boiuní it must be because the transaction came within the implied powers of the various partners as representing the firm.
There was no testimony showing that the books of the firm contained reference to such a transaction, and no receipt or voucher was produced. Neither was any evidence produced in any shape from the documents of Gilbert Hatheway’s estate which tended to show the deposit of such securities as in Moore, Foote _& Go.’s hands at his death. ■Claimant’s testimony consisted chiefly of facts connected with the money dealings and special deposits of Gilbert Hatheway, and of statements of Bagley and Foote after his death.
It was shown that after Gilbert Hatheway’s death claimant had conversations .with Bagley and one or more with Foote in which it was said that there were then bonds to a large amount in the hands of the firm. Nothing was said concerning the character of these bonds as government or State bonds, and if all the conversations are taken together it might be inferred that they referred to- supposed deposits in some bank or banks in Detroit. But if these conversa tions were enough, to create a liability such as is claimed, it would have been for the jury to pass upon the testimony. There was some evidence of conversations in 1875 with Bagley which, taken together, do not indicate anything more than a supposition of special deposits in bank; but these would not be material because made after dissolution and when Moore had assumed all the debts.
It cannot be claimed that these conversations, alone or together, could make out a liability such as was urged before the commissioners. The partnership was not organized for or used for banking or deposit purposes, and the reception of special deposits of securities for safe-keeping could not be of any profit or service to the firm. No partner not consenting to such arrangements could be bound by them. But this testimony is also fatally defective standing alone, because it does not identify any kind of bonds, while the claim filed is for government and State bonds.
We do not think the testimony of the previous dealings helps it out. The fact that the firm received money for Hatheway and kept it subject to his order, and allowed him interest on it, had no tendency to show that it was his depositary' of securities. The correspondence introduced by claimant tends rather in the other direction as showing dealings under specific instructions with bonds not in the hands of the firm, and credit in each instance given for money or its equivalent received, but in no case referring to disposals of bonds or other securities dealt with except under orders.
The testimony concerning the packages of bonds which were from time to time deposited in banks is undisputed to the effect that they were all deposited as Hatheway’s bonds, which he could himself control. This is not consistent with any theory of a bailment or deposit with the firm, but shows that any action by them or by any of them which was had, or which could have been lawfully had, was merely that of having them taken back and forth for Hatheway’s convenience to and from the bank where they were kept. It cannot be seriously claimed that this was firm business or that it made the firm Hatheway’s depositary. And Moore is not shown by any testimony in the cáse, and could not have been shown by any testimony .excluded, to have had any knowledge of or concern in these accommodation arrangements.
In our opinion nothing in the case, and nothing which the excluded testimony might have brought into it, tended to show that Moore, Foote & Co., in the course of business ever received on deposit the bonds claimed or any bonds.
And we think the case was properly taken from the jury and that the action of the circuit should be affirmed with costs, and the- conclusion certified accordingly.
The other Justices concurred. | [
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Cooley, C. J.
Mary Peet, claiming to be the widow of Lucius H. Peet, late of Clinton county, deceased, filed in the probate court for that county, where his estate was being; administered, a claim to an allowance as such widow. The. heirs contested her claim upon the ground that she was never legally married to the decedent. The probate court made: the allowance prayed for and the heirs appealed.
In the circuit court the judge heard the case without the assistance of a jury, and made findings of the facts. From these findings he concluded as matter of law that the claimant was not the widow of the decedent, and gave judgment against her. The case is brought to this Court by writ of, error.
The second of the judge’s findings of fact is as follows:
“ Mary Peet, this claimant, and Lucius H. Peet were married February 28, 1858, and lived and cohabited together as husband and wife until some time in November, 1880, when Lucius H. Peet died. In this case there was an actual marriage ceremony according to the laws of this State.”
This finding, it will be seen, makes out an apparent right in the claimant to the allowance asked for, and we have only to see whether in the other findings there is anything to overcome this prima facie right.
The other findings are as follows:
“ David and Deborah Belcher lived together as husband and wife, previous to 1847 or 1848, for about twenty years, and had thirteen children, and ceased 'entirely from living together in 1847 or 1848, he, David, going away from Deborah sometimes and coming back when he wished, there being no evidence, however, that such absences were intended to be a separation, or anything more than occasional absences from home. They had some trouble between one another while living, together as husband and wife. The reputation as to their being husband and wife was divided and no actual marriage ceremony is shown between David and Deborah Belcher. David Belcher died in 1860.
Lucius H. Peet and Deborah Belcher were married in February, 1855, and lived together as husband and wife about two and one-half years. In this case there was an actual marriage ceremony according to the laws of this State.
Deborah Belcher was living at t'he time of the marriage •of Lucius Ií. Peet and Mary Peet.”
These are the facts from which the circuit judge deduced the conclusion of law that the claimant was never legally married to the decedent. "We can not assent to this conclusion.
The marriage of the claimant was indisputably legal, unless Lucius H. Peet had at the time of its solemnization a lawful wife living. He had gone through the forms of marriage with Deborah Belcher, but after a time had aban doned her, and it is inferable that he did so because he had become convinced she had in David Belcher a lawful husband living. If she had, he was justified in leaving her, and in entering into marriage relations with the claimant.
The whole case therefore turns upon the question whether it appears that David and Deborah Belcher were husband and wife. It is not shown that any marriage cere-' mony ever took place between them j neither is the contrary proved; there is simply an absence of any evidence on thatx point. But an actual ceremony of marriage is not essential to the ’ establishment of the relation of husband and wife; it is sufficient that a man and woman of due competency, and in respect to whom no impediment exists, consent to take each other a's husband and wife, and actually cohabit' as such. The case of Hutchins v. Kimmell 31 Mich. 126; s. c. 18 Am. Rep. 164, determines this for this State, and refers to many decisions in other states to the same effect.
Now the circuit judge finds that David and Deborah Belcher lived together as husband and wife for about twenty years and had thirteen children. If they were living together as husband and wife their relations were not meretricious. The finding is equivalent to a finding that they had taken each other for husband and wife ; and is therefore .a finding of the fact of marriage.
The circuit judge attached importance to the fact that .the reputation as to these parties being husband and wife was divided; that is, we suppose, that some people believed and .said they were married and others believed and said the ■contrary. Deputation is sometimes very important when a marriage is in doubt; but it is only one of the circumstances from which the true relations of the parties, as legal or ■otherwise, may be inferred ; it is not in itself a fact which is at all important to the validity of the relation. When a •marriage in fact is made out, whether by formal ceremony or otherwise, it must stand, though the whole community say and believe it is illegal. But upon doubtful facts the court ought to presume a lawful marriage rather than a notorious act of immorality. Starr v. Peck 1 Hill 270, 272.
It is suggested on behalf of the heirs that the circuit judge did not intend to find that David and Deborah Belcher were married, and did not understand his finding on that subject to bear such a construction. That being so, we ought, it is said, to look into the evidence, and if it is evident from that that a- conclusion against marriage should be drawn, the case should go back for a new trial. We have looked into the evidence and are clearly of opinion that a marriage ought to have been found. There is really nothing to raise doubts about it, except that some of their acquaintances did not believe they were married. On much less evidence than the living together for twenty years, and the bringing of thirteen children into the world, marriage has been inferred even in cases where the cohabitation was shown to be meretricious in its origin. Fenton v. Reed 4 Johns. 52; s. c. 4 Am. Dec. 244; Taylor v. Swett 3 La. 33; s. c. 22 Am. Dec. 156; North v. North 1 Barb. Ch. 241, s. c. 43 Am. Dec. 778; Caujolle v. Ferrie 23 N. Y. 90. In this case there was no such showing.
The order of the circuit court must be set aside and that of the probate court affirmed, and the claimant must recover costs of all the courts.
The other Justices concurred. | [
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Campbell, J.
Ash, in his own name and as owner, replevied a pony from defendant, and recovered in a justice’s court and on appeal. Defendant brings the case up on error, alleging that the charge of the court was erroneous.
There appears in the record some testimony tending to show that defendant bought the horse, supposing he was buying of a daughter of plaintiff, as owner. The court, at any rate, gave a charge to tbe jury to the effect that if the daughter was under age and living with her father, and sold the horse, she conveyed no title and plaintiff must recover. 'We cannot but think the record is imperfect in some respects, but as it stands this clearly indicates that the title of the daughter and sale by her must have been considei'ed by the jury. It does not appear how this issue could have been properly dealt with in the way shown by the return. The suit was not brought on behalf of the daughter. Not only is it in the father’s name as sole plaintiff, but he presented his case by the evidence on the theory that he owned the horse himself. After this showing we do not see how the suit could proceed on the theory that he was suing on her behalf, as her guardian or next friend. The charge can only be explained on that idea, unless something occurred which, if inserted, would have explained it differently. On this record we are not called upon to discuss the rights of infants, and shall not attempt to do so.
There must be a reversal and new trial.
The other Justices concurred. | [
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Campbell, J.
Plaintiff replevied certain buggies, and recovered judgment. The facts were in substance these. Defendants made a purchase from Joseph Duen & Co., the manufacturers at Cincinnati, payable on delivery. Duen & Co. sent the property to Bangor, consigned by bill of lading to Howard, and sent the bill of lading and a draft for the amount through intermediate agencies to the plaintiff, to be delivered to Howard on payment. Harvey was the real purchaser under Howard’s name, the latter to have a share in the profits and the apparent control. Defendants obtained leave of plaintiff to examine the property and had it removed to their own premises. Some negotiation was had as to the allowance of reduction for errors and damages, and they undertook to sell some of the property. Mr. Chase, who is president of plaintiff, sued out an attachment on the accepted draft in the name of Duen & Co., and the property was attached. This was done without any authority from Duen & Co. and the suit was discontinued and the attachment dissolved, and the property returned to Howard and replevied.
The questions all arise upon rulings upon the charge, and no questions of fact are left open by the requests. The main controversy is whether plaintiff Rad any possessory rights. One or two collateral questions are also presented.
¥e see no ground for complaining that the judgment is joint. The defendants were connected in all the transactions and their possession was clearly joint.
The attachment suit is unimpórtant because it was unauthorized, and in no way changed the lights of Duen & Co. Plaintiff was no party to that controversy.
After considerable delay in the various transactions plaintiff paid the draft to Duen & Co. This payment was not made on behalf of defendants, and we do not see any reason why the plaintiff has not the same right now that it would have had if the draft had been cashed on receipt. It represented the debt on payment of which plaintiff was authorized to deliver the property, and plaintiff was practically a bailee of the property to obtain the payment and hold it till' paid. "We think that whether it was paid Duen & Co. or not in advance could not concern defendants, who could not lawfully hold the property sold against either. But in our opinion the transaction was such as to give plaintiff all the rights that Duen & Co. had in the property. Such dealings cannot be subjected to any technical niceties, butpnust be decided on common-sense grounds.
"We think the judgment must be affirmed with costs.
The other Justices concurred. | [
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] |
Graves, C. J.
On the 29th of September, 1881, the plaintiff was on his way to the city of Muskegon by the public road known as the Allegan, Muskegon & Traverse Bay State road, with a load of hay, and on passing over the defendant’s track where it crosses said road near the city, his load upset and he received injury. He attributed the occurrence to the unsafe condition of the south approach contiguous to the rail, and sued the company in this action for his damages. The circuit judge instructed the jury to-find in favor of the company. The grounds on which the ruling is defended will be briefly noticed.
Fi/rst. It is made a point that no testimony was offered ■tending to support the averment in the declaration that the highway “was laid out, established and constructed by proper legal authority.” The point is not borne out by the record. There was evidence tending to show that the State laid out the road and caused it to be constructed, and ■evidence tending to show further that the defendant treated it as a legal public thoroughfare established and constructed by competent authority.
Second. It is next contended that the railway company was not subject to any duty to keep the ápproaches to its track in order at the crossings of public roads. The requirement of law, we are told, goes no further as respects the ■company than to exact a restoration of the road, when the ■crossing is made, to its former state as near as may be, leaving it as a duty of the public to keep up and preserve the proper conditions thereafter, and to do whatever else the public safety or convenience may dictate.
This is not a correct view. If the Legislature had kept silent, the common law would have applied, and the company, ■on cutting through the highway, would have been bound to •construct and maintain the crossing in such plight as to make it reasonably safe. People v. Chicago & A. R. R. Co. 67 Ill. 118; Oliver v. Northeastern Ry. Co. L. R. 9 Q. B. 409; Paducah & Elizabethtown R. R. Co. v. Commonwealth (Ky.) 10 Am. & Eng. R. R. Cas. 318; Manley v. St. Helen's C. & Ry. Co. 2 H. & N. 840. And it could not have been the purpose of the Legislature to abridge this •duty. No reason for such a design can be imagined. The intent would rather be to explain and emphasize if not to ■expand it.
The statute declares that the company must restore the highway to its former state as near as may be, and construct suitable road crossings for the passage of teams, by putting down plank between and on each side of the rails of •such road, the top of which shall be at least as high as the top of the rails of such road. Act 177 of the. Session of 1877, sec. 9, subd. 5 [IIow. Stat. § 3323]. The same reason would exist for perpetuating these conditions as for having -them established originally, and it is a necessary assumption that their continuance was contemplated, and when we recall how very important it is to the public safety, and how necessary to enable the company to fulfill its acknowl•edged obligations, and how essential to prevent confusion where the consequences might be disastrous, that it should have the track and its immediate adjuncts under •the supervision of its own servants, selected an'd trusted on account of their special fitness, the construction which ■■counsel now urge in its behalf is wholly unsatisfactory. The statutory regulations abroad are far from uniform, but the general course of decision is in favof of the view we take. People v. Chicago & A. R. R. Co. supra; Eyler v. County Com'rs of Allegany County 49 Md. 257; Chicago, R. I. & P. R. R. v. Moffitt 75 Ill. 524; Cooke v. Boston & L. R. R. 133 Mass. 185: Masterton v. N. Y. C. & H. R. R. Co. 84 N. Y. 247; Wooley v. Grand S. & N. T. R. R. Co. 83 N. Y. 121; Payne v. Troy & B. R. R. Co. id. 572; Cott v. Lewiston R. R. Co. 36 N. Y. 214; People v. N. Y. C. & H. R. R. Co. 74 N. Y. 302; Wellcome v. Leeds 51 Me. 313; White v. Inhabitants of Quincy 97 Mass. 430.
Third. "Whether the duty to prevent the defects complained of extended to the city of Muskegon there is no occasion to decide. It is quite sufficient that on the theory of fact affirmed by the plaintiff, the suit is well brought against the defendant. If any duty lay upon the city to preserve the approach and crossing in a reasonably safe condition, — a point which is not considered, — it was not exclusive. It had no effect to derogate from the duty, or mitigate the responsibility of the defendant, and it could make no difference with the question of liability as between the latter and the plaintiff. Under the state of facts on which -the plaintiff relies, the defendant would certainly be liable whether the city would be or not. The principle is well .settled. Masterton v. Railroad Co. supra; McKenna v. Metropolitan R. R. Co. 112 Mass. 55; Judson v. N. Y. & N. H. R. R. Co. 29 Conn. 434.
There is no force in the suggestion, to which the circuit judge seems to have given assent, that plaintiff was negligent in driving over the road which he knew was out of repair. He had an undoubted right to drive over the road and nobody could deprive him of the right by putting the road out of repair, or by any neglect of duty in repairing.
No reference has been made to the late provision in the .highway law, which took effect about three weeks prior to the injury for which the plaintiff sues. Public Act 2é3 of the Session of 1881, section 27. [How. St. § 1322], The application of that provision is not certain and there can be no asumption that an individual would haye any remedy in virtue of it. Further remark is uncalled for.
The ruling cannot be defended on the reasons urged in its favor and the judgment must be reversed with costs and a new trial granted.
The other Justices concurred. | [
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] |
Sherwood, J.
This is an action of assumpsit against the Michigan Barge Company as maker, and Ferry & Brother as indorsers,*of a promissory note of which the following is a copy:
“$5000. Grand Haven, Mich., Sept. 20, 1882.
Four months after date we promise to pay to the order of Ferry & Bro. five thousand dollars, at the Importers’ & Traders’ National Bank, New York. Yalue received.
Michigan Barge Co.
Andrew Thompson, Treasurer.”
The Michigan Barge Company and Edward P. Ferry pleaded the general issue. The former denied the execution of the note under oath. Thomas W. Ferry did not appear.
The Michigan Barge Company was duly organized on the 27th day of December, 1879. On the day the note sued on was made, the record shows that Thomas W. Ferry, Edward P. Ferry, John Furlong, Andrew Thompson, Henry G. Bigelow and Dwight Cutler were all the stockholders in said company; that the Ferrys held $199,325 of the stock, John Furlong $600, and the other three $25 each, and that this constituted all the stock of the company. It further appears that on that day the share of stock standing on the books in the name of Dwight Cutler was held by him solely for the use of T. W. Ferry, so as to enable Cutler to act as one of the officers and directors of the company, and he did so act and subsequently re-transferred the share of stock to T. "W. Ferry.
On the day the note was given, so far as the record shows, T. W. Ferry, in matters relating to the Barge Company, acted for Edward P. Ferry as well as himself, and on the 20th day of September, 1882, Andrew Thompson was treasurer of the Barge Company and had been several years before, and Henry G. Bigelow was the secretary.
Among the articles of association adopted by the Barge Company in its organization is the following:
“ The stock, property and affairs of said company shall be managed by a board of five directors who shall be stockholders, and all the rules and regulations for the conduct and management of the business of this company shall be in accordance with the provisions of the statutes under which the company is organized, and of such by-laws as shall hereafter be adopted in pursuance of said statutes, and of these articles of association.”
Among the by-laws adopted appears the following:
“ The treasurer shall sigu or indorse all drafts, notes and' checks for the company, be custodian of its funds and disburse all moneys under direction of the board of directors; he shall give a satisfactory bond to the board of directors for the faithful performance of his duties.”
“No debt shall be contracted for or against‘the company unless first authorized by vote of the board, of directors, except such debts or credits as are necessary to carry on the ordinary current business of the company.”
On the 3d day of January, 1881, the board of directors of the Michigan Barge Company took action as follows:
“The following resolution offered by Thomas W. Ferry and supported by John Furlong was adopted, viz.: That the several stockholders of this company have the right at any time, on their application to the treasurer, to the notes and indorsements of this company in such amounts as they may ask for, not exceeding at any and all times twenty-five per cent, of the par value of the stock severally owned, as appears upon the stock-books of the company, and at no time shall the secretary transfer or allow the transfer of any stock of any stopkholder on the stock-book to an amount less than four times the amount of the notes and indorsements of the company which may at any time have been given such stockholder and outstanding uncanceled. Any resolution inconsistent with this is hereby rescinded.”
The foregoing resolution was received in evidence without objection.
H. G. Bigelow, who was the first treasurer of the Michigan Barge Company and when the note was issued its secretary, was sworn for the plaintiff and testified: Andrew Thompson, the company’s treasurer, made and executed the note; the signature of the company and body of the note are in his handwriting. ITe also testified that the indorsement of Ferry Brothers is in the handwriting of Thomas W. Ferry, and there is no pretense or showing that the note did not come to the possession and ownership of plaintiff in regular course of business and for value, but on the contrary it affirmatively appears without contradiction that it was so received by the Bank.
The record asserts the fact that the execution of the note was denied undei; oath, but by what authority or by whom such affidavit was made, we are not informed by the printed record. It is, however, difficult to understand under the facts stated in this record, and we have before us all the testimony taken in the bill of exceptions, how or upon what theory such an affidavit could be made. Under the articles of association and the by-laws of the Michigan Barge Company, its treasurer was authorized to execute the notes made by the company. In his official capacity the treasurer so signed this note. It was a negotiable promissory note, due four months after date, made and executed by the treasurer on the 20th day of September, 1882, payable to the order of Ferry & Bro., by whom it was indorsed and placed upon the market for sale with Orvis & Co., note brokers in the city of - New York. These brokers sold the note to the' plaintiff for its face value, and the owners of the paper received the proceeds thereof, and as we think the circuit judge very properly held, all the stockholders having any interest in the Barge Company had knowledge of the transaction ; substantially that Ferry & Brother ran the Barge Company.
The plaintiff bought the note in good faith and paid its full value in money therefor, and when the same became due and plaintiff demanded its money, E. P. Ferry denied the contract made and his liability thereon, and permitted the Michigan Barge Company to deny not only all liability, but further that it 'ever made any contract creating the same. The evidence undisputed shows that it was for Ferry & Brother (of which firm E. P. Ferry was a member) that the note was made and executed, and for their benefit it was negotiated, and it is nowhere shown that they did not receive the benefit thereof.
Upon the facts as they appear upon this record the defense made is one not entitled to favor. This suit involves equitable rights of these parties, and unless compelled by some imperative rule of law to the contrary, it is clearly our duty to sustain the claim made by plaintiff. After making proof of the articles of' association and by-laws of the Michigan Barge Company, and the making and execution of the note by its treasurer, and the indorsement by Berry & Brother, and that the plaintiff paid full value for it, the plaintiff offered the note in evidence. Defendants objected on the ground that it was incompetent, immaterial and irrelevant, and stated twenty reasons in support of the objection. After a careful examination, we find none of them sufficient to sustain the objection taken, and it was correctly overruled.
The plaintiff’s cashier was sworn and by its counsel asked the following question in regard to the note: “ At the time you purchased it, what knowledge had you, if any, of any defects in the note ?” Defendants objected that it was incompetent, irrelevant, immaterial and calling for a conclusion. Certainly, if the defendant’s theory of the case was correct, the testimony was proper. As the case stood, however, latent infirmities in the note were of no consequence, and the answer being that the witness had no knowledge of any, it could not prejudice the defendant. The objection was properly overruled.
The principal points relied ujaon by defendant’s counsel are — First, that if the treasurer had authority to make and execute this note as treasurer he did not do so but executed it as agent, and his authority as such does not appear; second, that the treasurer had no authority to make and execute the note in behalf of the Barge Company; third, that the note was not issued in carrying on the ordinary and regular business of the Barge Company; it was therefore not binding upon the company, and the plaintiff was bound to take notice of these facts at his peril.
Counsel for defendant admit that the Barge Company had power under the statute to issue its negotiable paper in its regular business. The treasurer is the person designated by the articles of association and by-laws to make such paper. The note is made and executed in due form by the Barge Company, by Andrew Thompson, its treasurer, and not as agent. This disposes of the first point so relied upon.
The ordinary management of the affairs of the Barge Company was, undoubtedly, under the control of its directors. Star Line of Steamers v. Van Vliet 43 Mich. 364. At the time the note was issued there were but six stockholders in the company, and they were all its directors, and in that capacity duly passed the resolution of January 3, 1881, above given. This resolution, and the paragraph from the articles of association and by-laws of the Barge Company above quoted, clearly authorize the treasurer to-make and execute the note in suit on behalf of the company. Either of thd Eerrys, under the action of the board of directors, was entitled to have a note from the Barge Company, issued by its treasurer, of the amount of the one in suit, whenever application to the treasurer should be made therefor. No other of the stockholders, however, was entitled to such note. It is true, the firm of Ferry & Bro. were not stockholders, but its members were, and each had the right to have the note applied for by him made payable to such party as he might desire. It could make no difference to the Barge Company to whom the note was made payable; that was of no consequence; it was the note' of the Barge Company or its indorsement the stockholder was entitled to when applied for. It is not necessary to determine what would be the effect of the resolution referred to were these stockholders who were not members of the board of directors, or to what extent such action would tend to bind them, but as the case is now presented it would be a fraud on justice to deny its binding force upon these defendants. This disposes of the second point.
The evidence that the plaintiff bought the note in good faith, and paid full value for it is undisputed. There is-nothing appearing upon the face of the paper indicating a want of authority in the Barge Company to issue it, or that it was irregularly issued, or that it was not issued in the-regular and ordinary transaction of the company’s business. In sueh case, where the corporation has power to issue negotiable notes, and the purpose for which it issued them is not absolutely prohibited by statute, a bona fide holder ■of its paper will be protected though it appears that the note was unauthorized for the particular purpose for which it was made; the rule being in this class of cases that, where a corporation has under any circumstances power to issue negotiable paper the bona fide holder has the right to presume that it was issued under the circumstances which gave the requisite authority, and the negotiable paper of a corporation, which appears on its face to have been duly issued by such corporation, and in conformity with the provisions ■of its charter, is valid in the hands of a bona fide holder.
The plaintiff’s case is clearly within these rules. The ■circuit judge was evidently of the same opinion, and gave judgment accordingly.
That judgment must be affirmed with costs.
The other Justices concurred. | [
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] |
Campbell, J.
Plaintiff sued defendant for commissions on a sale of logs, the sum claimed being 25 cents a thousand on between 11 and 12 million feet. The court below, allowing recovery for some other causes of action,0ruled that there could be no recovery for this, which must have been on the ground that there was no testimony to support it.
Defendant, who lives at Poughkeepsie, New York, owned the logs in question, some cut and some not then-cut, on Rifle river. January 7, 1881, defendant wrote a letter to plaintiff, in which, after describing the property, he says: “I would sell them for $8, or if you thought necessary, as low even as $7.50. I want you to find a customer for me, and I will feel greatly obliged, besides paying you whatever you ask for your trouble.” This is the only direct communication from defendant to plaintiff relating to employment. Plaintiff testifies that before he received it he was called upon, at his office in Bay City, by Mr. Barker, who told him he had received a dispatch from McG-raw, stating that Mr. Hall, president of the Export Company (the subsequent purchasers of the logs), would be there in a day or two, aud desiring plaintiff to be sure and sell the logs to him. The price mentioned was $7.50 a thousand. Mr. Hall is said by plaintiff to have been present at this interview. Immediately thereafter plaintiff visited the place where the logs were, and Hall desired him to report to him, and he subsequently telegraphed and wrote to Mr. Hall his views about value and the policy of purchasing them. He subsequently telegraphed to defendant that if he would go to New York, he could probably close a bargain with the Export Lumber Company. He also telegraphed to New York to Mr. Hall, the president, advising him not to buy over eight dollars, and that he should want a guaranty for delivery by July 1st. This delivery, he says, was to be at Bay City, while the prices mentioned by defendant were at the boom, which would involve the purchaser in expenses and risks of removal to the ultimate destination. Plaintiff had previously peformed services for the Export Company, and after these logs were sold, attended to their sawing. There is a conflict between him and Mr. Hall as to whether Hall paid him commissions on this purchase.
Defendant went to New York and was unable to contract with Hall on the original terms proposed, owing to plaintiff’s advices to Hall. A bargain was finally made for a portion of the lumber, excluding certain qualities, and the contract provided for delivery at Tawas and Bay City, and involving some stipulations as to rafting and sawing. The testimony indicates that the price received was practically considerably lower than that proposed, but as plaintiff puts his claim on peculiar grounds which do not involve this inquiry very closely, and as the case was taken from the jury, we cannot look into any disputed matters.
It appears, however, from plaintiff’s own showing, that he peformed services for Mr. Hall in connection with this business, and that, so far as he exercised any influence at all, it was not in the direction of getting a sale on the terms proposed. It might be a matter for serious consideration whether this double agency could be allowed to form a basis of compensation, if it were true, as plaintiff claims, that his duty assumed was merely to bring parties together. But there is nothing in the case which, in our opinion, indicates that he was to receive any compensation unless he procured a purchaser at defendant’s prices. Such is plainly, we think, the meaning of defendant’s letter to plaintiff. The only other communication bearing on the subject was a dispatch to defendant’s agent fixing the same prices, and naming Mr. Hall as the purchaser to be approached. If this is the one read in the presence of Hall and plaintiff, as plaintiff alleges, it was confined to the procurement, or at least the attempt to procure, a sale to Hall at the boom for the prices named, and the purchaser was nominated by defendant himself. No such services, either by attempts or successful results, were shown. The case, in our opinion, is entirely destitute of any testimony of the rendering of such services as were contemplated.
"W e think the judgment is correct and should be affirmed.
Sherwood and Champeen, JJ. concurred. Coolet, C. J. did not sit in this case. | [
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] |
Graves, O. J.
This action was commenced before a justice of the peace to recover the penalty of $10 alleged to have been forfeited by the Bailway Company under section twenty-seven of the Act approved June 8, 1881, entitled “ An act to revise and consolidate the laws relating to the establishment, opening, improvement and maintenance of highways and private roads, and the building, repairing, and preservation of bridges within this State.” The section reads as follows:
“ Where any highway may have been or shall be established across any railroad, the company operating such rani-road shall open, construct a/nd maintain such highway and the necessary crossing therefor across their right of way and brack. The commissioner may serve a written notice on any person in charge of the ticbet or freight office nearest to such crossing, requiring such opening and construction within thirty days from and after the service of such notice, and in default of such opening and construction as required by such notice, the company in fandt shall be liable to a penalty of ten dollars per day for every day thereafter during which such highway shall remain unopened, and during which the same and the necessary crossim,g therefor shall remain unconstruciedP Pub. Acts 1881, pp. 288-295.
The Pailway Company pleaded the general issue, and the case was submitted to the justice on the following agreed statement of facts:
1st. That nine years ago defendant constructed its line of railway from Jonesville, Hillsdale county, Michigan, to Lansing, Ingham county, Michigan, crossing the township line which divides the townships of Lansing and Delhi, Ingham county, twenty rods east of the county line which divides the counties of Ingham and Eaton.
2d. That in the fall of 1882 a highway was duly laid out and established on said township line, commencing at said county line and running thence east on said township line one mile.
3d. That the township authorities caused the timber on the line of such highway from said county line east to the railroad right of way to be chopped and fallen (preparatory to opening such highway) immediately after such highway was so laid out.
4th. That thereupon the commissioner of highways of one of said townships served upon the defendant, in accordance with section twenty-seven of Act 243 of the Laws of 1881, a notice stating to defendant the establishment of such highway, and requiring it, said defendant, to open, construct and maintain such highway across ¿its right of way and track.
5th. That said highway has never been actually opened to the public or for travel on either side of said railway.
6th. That defendant failed and neglected to comply with such notice, or to open, construct or maintain such highway, and that more than thirty days, to-wit, thirty-one days, have elapsed since such service of said notice.
7th. That defendant’s right of way at said point is one hundred feet wide, fenced and occupied by defendant, and it would cost to so open and construct, as required by said notice, at least one hundred dollars.
8th. For the purpose of this suit no question is made about the regularity of the laying out or establishment of such highway, or as to the contents or service of such notice, each and all being admitted to be in accordance with said section of said session laws.”
The justice decided that these facts established the forfeiture sued for, and he gave judgment accordingly. The Railway Company removed the case by statutory certiorari, and the circuit court determined that the facts were not sufficient and reversed the judgment. The public authorities now ask an examination of the case here on writ of error, and contend that the facts well warranted the judgment given by the justice, and that it ought to be restored.
There is no controversy, about general principles. The company does not deny that it holds its property, as do all other proprietors, subject to the sovereign power of police and the general authority of government. It sets up no claim to favor, nor any immunity from the acknowledged maxims of justice. It solicits no discrimination. "What it contends for is that no exception shall be made against it in the application of these principles.
The sacredness of property does not depend on whether the proprietor is a natural person or an artificial person. Nor does it depend on whether the property itself consists of lands, or shops, or warehouses, or railroads, or cars, or corporate stock. "Whether property interests are in farms, or in buildings, or in cheese factory associations, or in other corporate industries, or in some other lawful form, the fundamental rights of ownership are exactly the same. It is one of the first and one of the main objects of government to protect the rights of property wherever they reside, and in case this duty is consciously and deliberately violated in any direction, it is not a mere political non-feasance, — it is a downright assault upon the right vested in every holder of property, and a breach of that trust which the institution of government implies. Whether the proprietor is wise or foolish, rich or poor, weak or powerful, a natural person or a corporation, the rule equally applies.
But in order to administer the requisite protection, and effectuate, as far as may be, tbe public safety, utility, and convenience, a great variety of interferences become necessary. And so long as they fairly conform to the principles on which they respectively depend, they cannot be questioned. But if in any instance the reason of interference, which the fact conclusively implies, has no connection with the only reason on which it would be possible to justify that interference, the claim of right by virtue of the police power becomes a mere pretext, and the particular interference is a perversion of authority and an invasion of the right of property.
Admitting this to be an accurate view, how does it bear on this controversy ? We are not dealing'with a case where the question is as to what a company may be bound to do to fit up crossings and construct approaches and adjustments' on a highway either older or newer- than the railway. A leading reason for requiring these things of the company is because it has practically rendered them necessary by the way in which it uses its land, and it seems entirely just to demand that as far as the same can be reasonably accomplished it shall reduce tlie inconvenience, occasioned to the public by its own peculiar mode of enjoyment, to a minimum. But when the reason ceases, the right of interference must cease. The obligation cannot be carried beyond its principle. As we observe, the case under review is not one concerning the construction of approaches or a crossing. But the fact is obvious that it must stand, if at all, on the reason just mentioned. "Unless what is required can be justified on the ground that the mode of enjoyment of its land by the company renders it necessary, it cannot be justified at all. Considering what it is that the company is asked to do, no other basis is possible. Can the requirement be supported on that theory ?
The township insists that the company shall remove the forest from its land within the limits of the highway, and fully construct the highway in all its parts over the entire hundred feet, and make it fit and ready for travel. Now, there is no such connection between what is here exacted and the mode in which the company occupies its land, as to let in the reason. The new highway proposed over the hundred feet is not a thing which is wanted in order to fit the railroad to its environments and establish a state of compatibility. It is to be a creation by itself, an independent work; not a contrivance which the existence of the railroad renders necessary, and which otherwise would be needless; not an appendage, not a feature of the railroad nor a thing incident to it. On being made, neither its continuance nor its excellence would be dispensed with if the railroad were removed. It would remain as an independent public work, to be kept up at the public cost. The sole ground, therefore, on which any power can be based for compelling the company to do the particular thing now demanded is inadequate and inapplicable. I agree, therefore, with the circuit judge. The statute cannot be applied in the large sense attempted. This conclusion might be enforced by reasoning in other channels, but I do not deem it needful.
Much reliance has been placed on Albany Northern R. R. Co. v. Brownell 24 N. Y. 345. It is enough to say now of that case that it does not apply.
I think the judgment of the circuit court should be affirmed with costs.
Dooley and Campbell, JJ. concurred
Sherwood, J.
I am unable to concur in the result in this case as stated by my brother. | [
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] |
Cooley, C. J.
This is an application for a mandamus to vacate a restraining order made by the respondent in a suit instituted in the Wayne circuit court in chancery, by James E. Scripps against the relator, and also for a writ of prohibition to stay further proceedings in that suit. Respondent has filed his answer to the application, and counsel have been heard upon it.
The important facts upon which the application is based may be briefly stated. The relator, in an action instituted by him in the Superior Court of Detroit, recovered against •Scripps a considerable judgment. The Superior Court is a •court of jurisdiction in matters of law and equity co-ordinate with that of the circuit courts of this State, and limited •only territorially. After the recovery a motion was made by the defendant for a new trial, which was argued in the Superior Court and denied. The defendant then removed the case to this Court by writ of error, and at the last October term the judgment of the Superior Court was affirmed. At the present term a motion was made and argued for a rehearing, which was denied. The purpose of these proceedings in this Court was of course to obtain a new trial.
While this was the position of the case, the suit was instituted in the Wayne circuit court. The bill alleges misconduct in the jury in the principal suit, and asks to have the judgment canceled because of it. Though not in terms ■praying for a new trial, the bill manifestly has that -for its purpose, and is as much a bill for a new trial as if that had been the relief expressly prayed. From this statement of facts it will be very evident the circuit judge has made a mistake in assuming jurisdiction of the case and making orders in it. The matter is not one which, under the circumstances, can come under his cognizance; other courts have control of the controversy with all its incidents, and have ample competency to do in respect to it whatever may remain to be done. It is a familiar principle that when a court of competent jurisdiction has became possessed of a case, its authority continues, subject only to the appellate authority, until the matter is finally and completely disposed ■of; and no court of co-ordinate authority is at liberty to interfere with its action. The principle is essential to the proper and orderly administration of the laws; and while its observance might be required on the grounds of judicial comity and courtesy, it does not rest upon such considerations exclusively, but is enforced to prevent unseemly, expensive and dangerous conflicts of jurisdiction and of process. If interference may come from one side, it may from the other - also, and what is begun may be reciprocated indefinitely. The country has witnessed some such conflicts in which Federal and state courts of co-ordinate powers have unguardedly or unadvisedly undertaken to hamper or restrain each other’s action; and the mischiefs of which such cases are suggestive are quite as likely to arise when courts existing as part of the same system intrude with their process upon each other’s authority.
The writs prayed for should issue.
The other Justices concurred. | [
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Cooley, J.
In these cases, after the fullest consideration the members of the Court find themselves equally divided upon the question of reversing the decrees appealed from, and they must therefore stand affirmed but without costs.
We deem it not improper to say under the circumstances that in view of the very peculiar facts it is on many very obvious grounds desirable that the parties to this deplorable litigation should make earnest endeavor, by any necessary concession in matters of feeling, to restore and perpetuate friendly and brotherly relations.
The other Justices concurred. | [
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] |
Cooley, C. J.
Plaintiff replevied of defendant a shingle-mill. On the trial plaintiff deduced title under a bill of sale from Spaulding S. Ackles, bearing date April 6, 1882, and purporting to make an absolute transfer of the title. Ackles at the time was in possession and was operating the mill. He was indebted to the plaintiff, according to his testimony, in a considerable amouut, and, as he testifies for the plaintiff, he transferred the mill to the plaintiff as security for the debt. In immediate connection "with this he says he considered it a genuine sale. Plaintiff on his own behalf testified that Acides, after the bill of sale was given, was left to operate the mill till he had performed an outstanding contract, and whatever profits would accrue from it he was to pay to plaintiff on his indebtedness. Plaintiff himself took possession about July 1, 1882. The bill of sale was filed in the office-of the township clerk, August 10, 1882. Plaintiff says that he filed it because, in a casual conversation with a lawyer, he was advised that it would be safer to do so. The defendant is sheriff of the county and he seized the mill on attachments against Acides on August 11, 1882. The demands for which the attachments issued were created between February 9,1882, and August 3,1882.
In submitting the case to the jury the circuit judge failed to bring out the distinction between transfers of chattels by absolute sale and those by way of security, and he charged the jury at the plaintiff’s request, that if they found he took the mill from Acides for the purpose of paying him for money that Acides owed him, and to indemnify him for liabilities which he agreed to pay for Acides, and without any intent to hinder, delay or defraud the creditors of Acides, their verdict should be for the plaintiff. This could only be true if the sale was absolute; for the statute provides that “ every mortgage, or conveyance intended to operate as a mortgage, of goods and chattels, which shall hereafter be made, which shall not be accompanied by an immediate delivery, and followed by an actnal and continued change of possession of the things mortgaged, shall be absolutely void as against the creditors of the mortgagor, and as against subsequent purchasers or mortgagees in good faith, unless the mortgage, or a true copy thereof” shall be duly filed. IIow. St. § 6193. Good faith in the mortgagee does not protect the unrecorded transfer which conies under this statute. Haynes v. Leppig 40 Mich. 607; Fearey v. Cummings 41 Mich. 383; Cooper v. Brock 41 Mich. 491; Sut ton v. Rowley 44 Mich. 113; Anderson v. Brenneman 44 Mich. 198; Wallen v. Rossman 45 Mich. 333. There was abundant if not conclusive evidence to go to the jury on the theory that this bill of sale was nothing but a mortgage, and this seems to have been the theory of the plaintiff himself when he began his proofs.
The defense offered evidence -to show that a portion of the demands for which the attachments were sued out was contracted after the giving of the bill of sale, and in reliance upon the possession and apparent ownership of Acides. This was not received, but we think it should have been. The use of any such credit as the apparent ownership of Acides would give him, ought to have been anticipated by the plaintiff as a possible occurrence, and it might well be argued to the jury that plaintiff should have given some degree of notoriety to the transfer. The fact that persons continued to trust Acides without knowledge of any transfer, when they would have refused if they had known of it, is a circumstance bearing strongly upon the plaintiff’s good faith.
The plaintiff delayed the replevy of the mill for three months, and he claimed on the trial to recover as damages the profits he might have made in the interval. The defense objected to the proofs offered, and referred to the decisions in Allis v. McLean 48 Mich. 428 and McKinnon v. McEwan 48 Mich. 106, as authority against them. These cases are said not to be applicable, because they were suits upon contract, while the present is a suit sounding in tort. A distinction is undoubtedly to be taken between actions upon contract and actions of tort, in all cases where malice, express or implied, is an element; but where parties are in good faith litigating disputed rights, and there is a choice of remedies, the rule of damages ought not to depend upon the form of l’emedy the party has selected. This plaintiff elected to retake the property in an action sounding in tort; he might have waited until a sale and sued in assumpsit for the proceeds; but in either case the facts in controversy would have been the same, and the measure oí damages ought to be by the same rule. The real question is, by what rule shall we with most certainty .arrive at a knowledge of what they actually were. It was •shown in the two cases just referred to that estimates of profits are generally so unreliable as to be worthless as a means of ariving at the actual damages; and in Allis v. McLean it is said (p. 432) that “ the profits of running a sawmill are proverbially uncertain, indefinite and contingent. They depend on many circumstances, among which are •capital, skill, supply of logs, supply and steadiness of labor ; and one man may tail while another prospers, and the same man may fail at one time and prosper at another, though the prospective outlook seems equally favorable at both times. Estimates of profits seldom take all contingencies into the account, and are therefore seldom realized; and if damages for breach of contract were to be determined on estimates •of probable profits, no man could know in advance the extent of his responsibility. It is therefore very properly held in cases like the present that the party complaining of a breach of contract must point out elements of damage more certain and more directly traceable to the injury than prospective profits can be.”
It was said, however, that this language is not applicable to the present case, because Acides when he sold to the plaintiff had an unfulfilled contract for cutting shingles, upon which it was possible to estimate the profits with reasonable certainty. This contract was transferred to the plaintiff, [and] he was allowed to show, by the testimony of Acides and others, that the profits in filling it would be ten dollars a day. He was also permitted to give similar testimony without regard to that contract. We have looked through the evidence, and are of opinion that no better, case could be taken for an illustration of the worthlessness of this standard for the estimation of damages. It conclusively appears from it that the estimated profits could only be made under the most favorable circumstances; that the contingencies which stopped operations or rendered them unprofitable were numerous; and finally that it was very doubtful whether the business in the hands of Acides had been profitable at all. And it is a significant [fact] that the plaintiff, after delaying so long to retake the property, had not in the following May, when the suit was tried, got it into operation again. lie had then, as he says, arranged ■with a party to put it in condition for use and pay five dollars a day for the use of it, but with allowance of lost time for stoppages, which appear when Ackles run it, to have been frequent.
We think.the estimates of profits were not proper evidence.
The judgment must be reversed and a new trial ordered.
The other Justices concurred. | [
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] |
Graves, O. J.
The plaintiff recovered on one of defendant’s policies and error is alleged.
■ First. We think the declaration was sufficient under the rule of court, [Circuit Court Pule 104] and that the contract of insurance was properly admitted. The objection of variance was not tenable.
Second. At the date of this policy and down to the occurrence of the fire an incumbrance by mortgage of from three “to five hundred dollars rested on the property. The argument by the plaintiff that there was a lack of evidence on tills subject is not warranted. Among other items of proof the record contains an offer by the plaintiff to swear to the fact himself. Moreover, it appears by the charge that it was not disputed. The property was in Muskegon, and the policy was there issued and delivered through Haines & Chamberlain, the defendant’s local agents. The transaction .of the business was confined to Haines and O’Brien. There was no written application. O’Brien called on Haines to effect an insurance and told him where the property was; and Haines observed that he knew the property, and at once filled out the policy and delivered it. The plaintiff swears that it was not read to him, and that his attention was not called to any of its conditions or provisions, and that no questions were asked about mortgages or anything said on the subject, and that he did not disclose the existence of the mortgage. Mr. ITaines testifies that O’Brien was silent in regard to incumbrance, although it is his recollection that he asked him about a mortgage. The policy contained this stipulation:
“If any application, survey, plan or description of the property herein specified is referred to in this policy, such application, survey, plan or description shall be considered a part of this policy and the basis of this insurance: provided, however, that this company will not be liable under and by virtue of this policy, if there be any omission or false representation by the assured of the title, incumbrance^ condition, location or occupancy of the property, or any over-valuation or any misrepresentation whatever, either in a written application 'or otherwise.”
The defendant contended in the circuit court, as it contends here, that the plaintiff’s failure to inform the agent of the mortgage was a violation of the foregoing provision of the policy and a complete answer to the action. The circuit judge differed, and first observing that there was no written application, and no provision for a preliminary examination of the applicant by the agent, proceeded to charge the jury, in substance, that if they found that the policy was not read to the plaintiff before it was delivered to him, and that the agent gave it to him on his oral application without directing his attention to the conditions respecting incumbrance, and that the plaintiff on receiving the policy was ignorant of them, and that nothing was said either by the agent or the plaintiff before or after the emanation of the policy in regard to incumbrance, that they might then consider the existence of the mortgage as no impediment to recovery.
The defendant can sustain no exception to this charge. The provision in the policy is not applicable. The first paragraph relates to cases where applications, plans, surveys or descriptions are made and are by necessity in writing, and the last clause though not very clear, most obviously does not intend a case of mere silence in regard to the existence of incumbrance where no inquiry is made, and where no explanation is asked for, and the applicant is utterly unaware that any is required. If an insurer is apparently indifferent whether a property is unincumbered and is content to insure without in any way suggesting an interest in the question, the bare silence of the applicant upon it cannot be deemed a misrepresentation. If the applicant is guilty of no misleading conduct the insurer in such a case ‘must be taken to assume the risk incident to the undisclosed incumbrance. It must not be intended that the principle would hold in regard to incidents obviously implying unusual risks, and not likely to be discerned or contemplated by the insurer. The case requires no observa tions on that subject. It is sufficient to suggest the distinction.
Third. By clause 10 of the policy the plaintiff was required to render, as soon after the fire as possible, 'a particular account of the loss, signed and sworn to, and containing certain particulars there enumerated. And it was further provided by clause 13 that in case of being required by any person appointed by the company, either before or after the rendition of the preliminary proof, the plaintiff should submit to examination under oath and subscribe thereto &c. And it was declared by the 9th clause that “ the use of general terms or anything less than a distinct specific agreement, clearly expressed and indorsed on the policy, should not be construed as a waiver of any printed or written condition or restriction therein;” and the local agent Haines, who filled out and delivered the policy, testified that his firm, as local agents, had no authority to waive any conditions and never undertook to do so.
The fire occurred on the 10th or 11th of April, 1882, and the plaintiff notified Haines, the local agent, the next day, and he undeidook to convey information to the home office, and did so. The defendant directed Mr. Garnsey of Grand Bapids, its adjusting agent for the district, to examine into the loss, and he repaired to Muskegon for that purpose on the 19th of the same month or in .about a week after the fire. He called on the plaintiff for an account of the loss and for a statement of facts, and after interrogating the plaintiff as fully as he wished, he wrote out an elaborate detail containing everything from the plaintiff he saw fit to require. He then asked the plaintiff to sign this statement and swear to it. But the latter requested that before doing so it might be shown to his legal advisers, Messrs. Campbell & Allen, and he went with Garnsey to their office. Mr. Campbell objected that a few of the details were neither relevant nor proper, and that the plaintiff ought not to sign the paper and swear to it unless they were stricken out. Some discussion followed, and these passages were at length marked out and the plaintiff offered to subscribe and swear to the statement as thus altered. But, after some hesitation, Mr. Garnsey decided to insist on the statement as originally drawn, and he shortly after went away and took the paper with him.
The failure of a technical consummation of a full exhibit at this time was caused by the difference referred to in regard to the fitness of the particular passages objectéd to. The parties to this interview do not perfectly agree in regard to all that was said, but what has been stated is not matter of dispute. The plaintiff swears that Garnsey stated to him on leaving that he, .the plaintiff, would hear from him in a few days. But Garnsey testifies that he thinks he did not promise to communicate with him; that according to his recollection he said that if he had occasion to communicate with him he would do so through the agents, Haines & Chamberlain. He also thinks he made no further communication to the plaintiff. At the close of this interview, and on the same day, Mr. Garnsey made a long report of the case to the home office and sent with it the statement which the plaintiff had refused to sign. The report was long and accusatory, and it conveyed in the plainest manner the agent’s positive opinion that the fire was a criminal burning by the plaintiff. This report was received at the home office, and thereafter the company continued silent.
The plaintiff waited till the 10th of May, and then addressed a letter through his counsel to the company. He referred to the disagreement with Garnsey concerning certain passages in the statement which the latter wrote out, and also to the delay which had taken place and to some other matters, and then informed the .company that he waived his objections and would sign and swear to the statement in the form in which it was written out. The company made no reply and gave no intimation of having received the letter. It appears, however, that it reached the home office and that the secretary sent it to Garnsey, and also went himself to see that gentleman in relation to the matter it referred to. The conclusion reached by that interview is not expressly disclosed. The inference is unquestionable. The defendant’s conduct accorded with the report made by Garnsey, and if justified the implication that it refused payment of the loss on the ground of fraud. The letter remaining unanswered and unacknowledged, Mr. Campbell, on behalf of the plaintiff, called on Mr. Chamberlain, one of the local agents, and inquired what the defendant proposed to do, and he replied that it would not pay the loss because it was supposed that the fire was fraudulently contrived by the plaintiff.
This suit was then instituted to compel payment of the loss, and without previous service of preliminary proof. The defendant gave notice of false representations as matter of defense, but made no mention of the omission to furnish a statement of the loss. The statement made by Chamberlain to Campbell that defendant would not pay the loss on the ground that the burning was believed to be fraudulent was true. The company had decided. There is no room for any question on that subject. Indeed it is not denied. But the defendant claimed at the tidal and claims here that Chamberlain’s authority as local agent did not extend far enough to entitle him to give an instructive and truthful answer to the question put to him. He was expressly called upon in his character of agent, and in respect to a pending claim under a policy which his associate agent had given out. It is not denied that he knew his company had then determined not to pay, and for the reason which he explained. It is not denied that the plaintiff was entitled to the information sought, and it is not denied that the inquiry was in good faith. We think the plaintiff was entitled to receive from Chamberlain, as defendant’s agent, the truth which he communicated, and to act upon it.
Hnder various forms the defendant raises the question that the omission to serve preliminary proof and submit to examination was an incurable defect. On this subject the circuit judge gave the following instruction:
“ The plaintiff under this policy was not required to furnish any proofs of loss save the account required by clause 10 of the policy, which provides that the assured in case of loss should render a particular account of the loss, signed and sworn to, stating any other insurance, the cash value of the property and his interest therein, and the purpose for which and by whom the property was used at the time of the fire, and when and how the fire originated. The adjusting agent of the company having come, within a few days after the fire, and examined the defendant as to the loss, &c., and reduced to writing the statement of plain tiff y or such parts of the statements as he saw fit, if you find that the plaintiff disclosed to the adjusting agent and furnished him at the 'time with all the facts and information required to be given in such account, and submitted to such examination as the adjusting agent then required, and offered to sign and swear to a statement setting forth the same, but the agent added to the statement matters about other fires and then required plaintiff to sign the statement, and plaintiff had a right to refuse to sign such statement as thus prepared, and if the plaintiff offered to sign and swear to the statement, after erasing those matters, but the agent insisted on their remaining in, and took the statement away with him, and promised to communicate with the-plaintiff in a few days and failed to do so, and after waiting awhile the letter of May 10th was sent by plaintiff’s attorney to the defendant, if you find that afterwards the agent of the defendant informed the plaintiff or his attorneys-that the defendant repudiated all liability on the policy and would not pay the loss on the ground that the fire occurred through plaintiff’s fraud, or upon other grounds not relating to the sending of the particular account, the plaintiff was not, under all the circumstances, required to-render or furnish any further account before bringing suit.”
This instruction was strictly applicable to the state of fact, and it appears to be unobjectionable in principle. Were it necessary to recur to the common doctrine which estops the insurer from objecting to the want or sufficiency of preliminary proof where he has put himself upon the extreme ground of absolute non-liability, the consequence would not be different. The ascertained facts would subject the case to that principle. The usual provisions against deviations from written terms, and by way of restriction of the power of particular agents, are in general only applicable to those parts which relate to the formation and continuance of the contract, and not to those portions which assume to point out the matters and things to be observed by the insured after a loss, in order to enable him to sue, such as the giving of notice and the delivery of preliminary proofs of loss or submitting to examination. Carson v. Jersey City Ins. Co. 14 Vroom 300.
But here the insurer had a full investigation. The facts were all before its agent and were, moreover, in writing. The statement in the form in which the plaintiff at once offered to sign and swear to it, although very slightly abridged, was full and in substantial compliance with the call in the policy. But this is not all. He subsequently offered to subscribe and swear to it in the very form in which the agent originally drew it, and the offer was not accepted. It was not claimed to be too late. Indeed, no reason was given and we are not to search for one. None of the series of objections in this part of the case can be sustained. Roper v. Lendon 1 E. & E. 825; Commonwealth Ins. Co. v. Sennett 41 Penn. St. 161; Great Western Ins. Co. v. Staaden 26 Ill. 360; Mason v. Harvey 8 Exch. 819; Walsh v. Washington Ins. Co. 32 N. Y. 427; Braunstein v. Accidental Death Ins. Co. 1 B. & S. 782; Charleston Ins. Co. v. Neve 2 McMullan 237; Patterson v. Triumph Ins. Co. 64 Me. 500; State Ins. Co. v. Maackens 38 N. J. L. 564; Imperial Ins. Co. v. Murray 73 Penn. St. 13; Killips v. Putnam Ins. Co. 28 Wis. 472; Lycoming Ins. Co. v. Dunmore 75 Ill. 14; Sexton v. Montgomery Ins. Co. 9 Barb. 191; Maher v. Hibernia Ins. Co. 67 N. Y. 283; West Rockingham Ins. Co. v. Sheets 26 Gratt. 854; Phillips v. Protection Ins. Co. 14 Mo. 220; Blake v. Exchange Ins. Co. 12 Gray 265; Catlin v. Springfield Ins. Co. 1 Sumner 434; Gilbert v. North American Ins. Co. 23 Wend. 43; Mercantile Ins. Co. v. Holthaus 43 Mich. 423; Schenck v. Mercer County Mut. Ins. Co. 24 N. J. L. 447; Clark v. N. E. Mut. Ins. Co. 6 Cush. 342; Wood on Insurance 176, 832, 846, 837, 702.
The judgment should be affirmed with costs.
The other Justices concurred.
Circuit Court Rule 104 provides that in declaring upon printed policies of insurance it shall not be necessary to set forth specifically any more than the date and amount of the policy; the premium paid or to be paid; the property or risk insured; and the loss.
The declaration was as follows:
Muskegon County — ss.
John O’Brien, of the city of Muskegon, plaintiff in this suit, by Campbell & Allen, his attorneys, complains of Ohio Insurance Company, defendant herein in a plea of trespass on the case upon promises, filing this his amended declaration, in pursuance of the statute in such case made and provided and of the leave and order of said court.
For that the said defendant, which is a corporation duly organized and existing under and by virtue of the laws of the State of Ohio, and authorized thereunder to do the business of fire insurance, and which is duly admitted under the laws of the State of Michigan to do and carry on such business, doing business at the county of Muskegon aforesaid, heretofore to-wit, on the 29th day of March, A. D. 1882, at the city of Dayton, in the State of Ohio; to-wit: at the city of Muskegon aforesaid, on the application of the plaintiff made a certain policy of insurance in writing, whereby the said defendant in consideration of six dollars to it in hand paid by the said plaintiff, receipt whereof was thereby acknowledged, did insure the said plaintiff against loss or damage by fire, to the sum of four hundred dollars, to the following specified and located property, to wit: on his one story frame, shingle roof dwelling house and woodshed attached, situate, detached, on his two-acre lot situate on the northwest corner of Division street and Laketon avenue, in the city of Muskegon, Michigan, aforesaid.
And the said defendant, for the consideration aforesaid, did then and there and thereby promise and agree to and with the plaintiff, his executors, administrators or assigns, to indemnify and make good to plaintiff all such immediate loss or damage, not exceeding in amount the said sum of four hundred dollars, nor the interest of the said assured in the property, as.should happen by fire to the property specified, as aforesaid, from the said 29th°day of March, A. D. 1882, at 12 o’clock at noon,until the full end and term of three years next ensuing, to-wit: until the 29th day of March, A: D. 1885, at 12 o’clock at noon, which policy being No. <15,561.
And the said plaintiff further avers that at the time of the making, execution and delivery of said policy of insurance as aforesaid, and from thence until and at the time of the loss and damage hereinafter mentioned, he had an interest in said insured property to a large amount, to-wit:. to the amount of one thousand dollars, to-wit: being the sole owner thereof in fee simple absolute, to-wit: at the county aforesaid, and that afterwards, to-wit: on tlie 15th day of April, A. D. 1882, the said property so covered and insured in and by said policy of insurance as aforesaid, was burned, consumed and destroyed by fire, which did not happen or take place by means of any act or neglect of this plaintiff, or of any one in his behalf, whereby the said plaintiff sustained damages to a large amount, to-wit: to the sum of four hundred dollars, to-wit: at the county of Muskegon, aforesaid.
And the said plaintiff further avers that although he has in all things-observed, performed and fulfilled all and singular the matters and thingswliich on his part were to be performed and fulfilled according to the form and effect of said policy of insurance, and although he has sustained loss and damage on occasion of said fire to the said sum of four hundred dollars, yet the defendant has hitherto failed and neglected to pay to him, the said sum or any part thereof.
The plaintiff avers that being so indebted the said defendant afterwards, to-wit: at said county, on, to-wit: the 20th day of June, A. D. 1882, faillifullyundertook and promised to pay to said plaintiff the said sum of money, when thereunto afterwards requested: yet the said defendant, although often requested so to do, has not as yet paid the said sum of money or any part thereof, to the plaintiff’s damage of four hundred and fifty dollars. Therefore he brings suit &c.
September 9, 1882. Campbbli, & Amiss-,
Attys for Pl’ff.
Objection was made to receiving evidence under this' declaration on the ground that it did not aver notice to defendant of the loss, nor show that it was due and payable nor state a sufficient consideration for the absolute promise to pay $400.
Objection was made to receiving the policy in evidence on the ground also, that the policy set up in the-declaratioñ is a policy payable immediately upon the destruction of the insured property by fire, while the policy offered is payable sixty days after proofs of loss, and the company is not liable upon it until after sixty days from the time when proofs of loss were furnished by plaintiff to defendant. | [
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] |
Shbrwood, J.
The plaintiff sued the defendant in assumpsit, declaring upon the common counts for work and labor performed by himself for the defendant in keeping and running one of its boom-houses on the Tittabawassee river, during the rafting season of 1882, and accompanied Ms declaration by a bill of the items of his demand. Plea, general issue, with special notice; no question arises upon the pleadings.
The plaintiff was sworn as a witness in his own behalf, and testified in substance that in the spring of 1882 he went to one Spaulding (who, had been accustomed to hire men for the defendant) and applied for labor in defendant’s business. Spaulding told him he had no authority to hire plaintiff, and referred him to the president of the company, P. H. Weideman, and a few days thereafter he called on the president upon the subject, and was informed by him that W. S. Malcom was the superintendent of the boom company and was the man for plaintiff to make his bargain with. Plaintiff soon thereafter called on Mr. Malcom, and was employed by him to run the defendant’s boom-house for one hundred dollars per month until the close of the season, at which time he was to have fifteen per cent, additional. The defendant paid the monthly instalment of one hundred dollars but at the close of the season refused to pay the fifteen per cent, and twenty dollars for cleaning the boom before his employment by the month, and for these two items suit was brought. The plaintiff had judgment for twenty-one dollars and thirty-four cents, and now brings error.
The defendant claims that Malcom had no authority to make the contract he did with the plaintiff for the fifteen per cent, additional, and this is the only question we deem it necessary to consider.
On the 4th of March, 1882, the defendant’s board of directors passed a resolution “that the wages for laboring men employed by the boom company for the present season be started at two dollars per month higher than was started at last year, and that the men signing contracts to remain during the entire season have added, at the close of the season, fifteen per cent, to their wages.”
It is claimed that this resolution restricts officers of the company from employing the plaintiff on the terms above statedthat the resolution refers to a certain class of laborers, and plaintiff does not belong to that class, and consequently he could not be employed and receive the fifteen per cent, additional, and that his contract made with the coinpany by its superintendent is not binding on the company ; that Malcom had no authority to make the same. And the circuit judge so held, and directed the jury to exclude the fifteen per cent., amounting, as claimed, to about one hundred and five dollars.
This ruling was erroneous. There is nothing in the resolution which prevents the employment by the company of any other persons than those intended or alluded to therein, in such numbers and upon such terms as it deems proper. It is in no sense a limitation upon the powers of defendant, byits officers, to make such terms with laborers or persons in their employment, in other cases, as they may think neces sary for the interest of the company. There is no pretense that plaintiff knew of any action of any kind by the defendant’s board of directors.
It is conceded that Malcom was permitted to do much of the hiring of the help for defendant, and the president testifies he himself had authoi’ity to hire laborers for the defendant, and referred the plaintiff to Malcom as the person with whom to make his bargain. The company recognized the contract the superintendent made with the plaintiff, and paid him for his services in accordance with its terms, and only refused performance when the fifteen per cent, became due and was demanded.
If the president and superintendent of this company defendant cannot by contract hire the necessary laborers to carry on its business, it is difficult to recognize any persons who could legally perform that service. We think the record clearly shows Malcom had full authority to make, in behalf of the company, the contract he did in this case with the plaintiff, and justice and good faith alike require defendant should comply with its obligations therein contained.
Malcom’s letter to the president of the company, dated December 12,1882, should have been admitted in evidence. It was obtained, at the instance of the defendant, for the purpose of ascertaining the terms of the contract its superintendent had made with the plaintiff and the extent of liability thereunder.
The judgment must be reversed with costs and a new trial granted.
The other Justices concurred.
East Saginaw, Dec. 12, 1882.
R. H. Weideman, Esq.
Dear, Sir: I told Gilbert Hardy when I bad tbe talk witb bim last spring, if be would stay through tbe whole season of rafting, till tbe boom closed in tbe fall, I would allow bim tbe 15 per cent. I also told him if be would clean up tbe section bouse, and do a good job of it, 1 would see bim paid for bis work on tbe bouse. W. S. Malcom. | [
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] |
Cooley, C. J
On -July 22, 1882, a decree in chancery was entered in the Ingham circuit court, in the case of Andrew J. Carr v. J. Deville Dennis, whereby costs were awarded to the complainant. On the next day the costs were taxed; and without waiting thirty days for the enrollment of the decree as the statute requires — How. St. §§ 664:9, 6653 — the complainant took execution immediately. This was directed to the sheriff of the county of Tuscola. July 24, 1882, the decree was enrolled. September 12, 1882, the defendant made an affidavit as a basis for a motion to recall the execution, and gave notice to complainant’s solicitor of such a motion. The motion was not brought to a hearing until February, 1883. Meantime the sheriff of Tuscola county had levied upon lands of defendant and sold the same, and the relator had become the purchaser, without, as he claims, any notice of irregularities. At the February term of the Ingham circuit court, 1883, the circuit court granted the defendant’s motion.
The relator now moves for a mandamus to require the ■circuit judge to vacate the order setting aside the sale. He shows that he had no notice of defendant’s motion; and this, and the fact that he was a purchaser in good faith, are the grounds of his application.
The circuit judge was irregular in vacating the sale without notice to the relator; But before setting aside his action we must see what justice requires; and we are satisfied that justice does not require that relator should be allowed the benefit of his salé. The execution is not returned, but it is to be assumed that it shows the date of the decree, so .that the la,ct that it issued prematurely appears upon it. But passing that point, we, cannot overlook another fact that is of much importance. The motion to set aside the order vacating the sale was not made until the time to redeem from the sale had expired, and the effect of granting it. would be to cut off the statutory right of redemption. It is not very clearly shown that relator did not know of the proceedings which.were taking place in time to move more promptly; but if not, confirming his sale now is more likely to do injustice than leaving the order already made to stand. "We think it proper, therefore, to leave the case in the hands of the circuit judge, who will no doubt protect the equities of all parties as completely as shall be found possible under the circumstances.
The other Justices concurred. | [
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Boyle, J.
This appeal involves an unusual admixture of partnership law in a case otherwise governed by Uniform Commercial Code principles. Although both courts below absolved defendant Michigan National Bank-Oakland of any liability to plaintiff Merwin K. Grosberg for conversion, the trial court reached its decision relying heavily on partnership principles, while the Court of Appeals focused instead on the commercial reasonableness of the bank’s conduct under the UCC. We find the partnership aspects to be controlling in this case and so affirm on that ground.
I
As developed below, plaintiff Grosberg became associated with Sheldon Goldman in several business ventures during the early 1970’s. In particular, Grosberg and Goldman were involved in the development, construction, and operation of the Chatham Fox Hills Shopping Center, with Grosberg supplying the necessary cash resources to fund the project and Goldman providing his management services. Goldman’s responsibilities included soliciting tenants, negotiating commercial leases, entering into subcontracts, and supervising the construction of the shopping center. In addition, Goldman was to receive incoming checks (representing rent and other payments) and deposit them in an account maintained by Grosberg at a bank (Manufacturers National Bank) other than defendant. To that end, Grosberg executed a power of attorney at Manufacturers, authorizing Goldman to indorse and deposit checks payable to Grosberg and to withdraw funds from that account.
Subsequently, Goldman, without the knowledge or permission of Grosberg, opened an account in both their names with the defendant bank, signing Grosberg’s name to the signature card along with his own. Over the next 18 months, Goldman deposited in that account over $100,000 in checks relating to the shopping center enterprise. The checks were variously made out to Grosberg, Grosberg doing business as Chatham Fox Hills Shopping Center, Chatham Fox Hills Shopping Center, and Goldman. On some of the checks, Goldman provided no indorsement, while on others he indorsed them by signing for Grosberg, Chatham Fox Hills Shopping Center, or himself, according to the payee named. Approximately $44,000 of the funds deposited in the account were subsequently paid out by Goldman for shopping center purposes; the balance of the funds were apparently diverted for Goldman’s own uses.
In May, 1975, Grosberg fortuitously discovered the diversion of funds when he stumbled upon an account statement while searching for papers in Goldman’s desk. Grosberg immediately ordered the account frozen pending his further investigation of the embezzlement. The relationship deteriorated, and, in July, 1975, the two executed a memorandum formally reciting the dissolution of their association and providing for the appraisal and application of certain of Goldman’s assets to offset the amount of wrongfully diverted funds, then estimated to be $86,000. Following an independent appraisal of their joint business assets, Grosberg and Goldman, in December, 1975, executed a memorandum of understanding that incorporated a complete accounting of all of Goldman’s defalcations, including the diversion of funds to defendant bank, and set forth a series of undertakings by Goldman to satisfy his obligation to repay Grosberg. Deducted from the diverted funds were the $44,000 in disbursements paid out by Goldman from that account for proper business purposes. As part of their agreement, Goldman gave Grosberg a security interest in all his home furnishings and assigned him a portion of the wages to be paid by Goldman’s new employer. There is no indication in the record before this Court that Goldman has not continued to honor his obligations to make restitution under that agreement.
Six months after executing the restitution agreement, Grosberg commenced the instant action against defendant Michigan National Bank, seek ing recovery for the bank’s alleged conversion of the $112,000 in checks belonging to Grosberg and the shopping center enterprise deposited by Goldman in the joint account. In a decision following a bench trial, Oakland Circuit Judge Farrell E. Roberts found that a de facto partnership had been created between Grosberg and Goldman and that, as a result, Goldman had authority to deposit partnership checks in the account opened in both their names at the defendant bank.
In affirming, the Court of Appeals agreed with the bank that the finding of partnership by the trial judge was not clearly erroneous, but found that because "no partnership purpose was involved in Goldman’s disposal of the negotiable instruments at issue here, defendant could not rely on Goldman’s actual authority,” Grosberg v Michigan National Bank Oakland, 113 Mich App 610, 617; 318 NW2d 490 (1982) (emphasis added), and, further, that because the defendant bank had no knowledge of the partnership, "defendant could hardly rely on any apparent authority of Goldman as a partner.” Id., p 616 (emphasis added). Thus, the Court of Appeals discounted the partnership relationship and instead relied upon the commercial reasonableness of the bank’s conduct, under Michigan UCC provisions MCL 440.3419; MSA 19.3419 and MCL 440.4205(1); MSA 19.4205(1), in supplying missing indorsements and accepting the checks for deposit. In closing, the Court observed that the only forgery in the case was that of Grosberg’s signature on the signature card, as to which the trial court’s finding of commercial reasonableness had not been challenged by Grosberg on appeal. Id., p 619.
Grosberg appeals, challenging the findings below of commercial reasonableness as to both the opening of the account and the acceptance of deposit items payable to Grosberg and the shopping center without proper indorsements.
II
In order to establish liability for conversion on the part of defendant bank, Grosberg is required to prove that the instruments at issue were "paid on a forged indorsement.” MCL 440.3419(1); MSA 19.3419(1). Even if such a showing is made, no liability "beyond the amount of any proceeds remaining in [the bank’s] hands” can attach where the bank has dealt with an instrument "in good faith and in accordance with the reasonable commercial standards applicable to the business of such [bank].” MCL 440.3419(3); MSA 19.3419(3). Because we find that the instruments here at issue were not in fact "paid on a forged indorsement,” we need not reach the issues of good faith and commercial reasonableness addressed by the courts below and raised by the parties on appeal.
A forged indorsement under the UCC is a form of "unauthorized signature,” MCL 440.1201(43); MSA 19.1201(43) and MCL 440.3404, Comment 1; MSA 19.3404, Comment 1, which is treated as "wholly inoperative as that of the person whose name is signed unless he ratifies it or is precluded from denying it.” MCL 440.3404(1); MSA 19.3404(1). It follows that a signature or indorsement that is authorized is not a forgery under the code. MCL 440.3403(1); MSA 19.3403(1). Under these provisions, then, an indorsement is not forged if either it is made by an authorized agent or, even though unauthorized, the signature is subsequently ratified by the principal or the principal is precluded from denying its validity. The instant case contains enough elements of authority to dispose of plaintiiFs conversion claim at the outset.
Goldman’s Authority to Indorse and Deposit Checks
We accept as given the trial court’s finding that Goldman had actual authority to indorse and deposit incoming checks only in the account maintained by Grosberg at Manufacturers National Bank, and not in the account opened by Goldman at defendant bank. Unchallenged on appeal, however, is the further finding that Grosberg and Goldman were partners in the shopping center enterprise. We depart from the analysis applied by the Court of Appeals, which discounted the significance of the partnership, and find that Goldman’s partner status invested him with implied authority to indorse and deposit each of the incoming checks in the account at defendant bank.
We begin with the principle, long established in this state, that a partner has implied authority to indorse checks made payable to the partnership. See Kaufman v State Savings Bank, 151 Mich 65, 68; 114 NW 863 (1908); First National Bank of Negaunee v Freeman, 47 Mich 408, 411; 11 NW 219 (1882); Link v First National Bank of Chicago, 312 Ill App 502, 510; 38 NE2d 815 (1942); see also Lentz v United States, 346 F2d 570 (C Cl, 1965); Anno: Bank’s Liability to Nonsigning Payee, 47 ALR3d 537, 548. This principle is reinforced in § 9 of the Uniform Partnership Act, as enacted in this state:
"[T]he act of every partner, including the execution in the partnership name of any instrument, for apparently carrying on in the usual way the business of the partnership of which he is a member binds the partnership, unless the partner so acting has in fact no authority to act for the partnership in the particular matter, and the person with whom he is dealing has knowledge of the fact that he has no such authority.” MCL 449.9(1); MSA 20.9(1).
In analyzing the provision quoted above, the Court of Appeals concluded that the section was inapplicable because the bank, having no knowledge of the existence of a partnership, "could hardly rely on any apparent authority of Goldman as a partner.” 113 Mich App 616 (emphasis added). That conclusion misconstrues the provision, however, which we interpret to be broad enough to encompass the usual definition of implied, as well as apparent, authority. While the latter term defines powers "arising from and in accordance with the [principal’s] manifestations to * * * third persons,” 1 Restatement Agency, 2d, § 8, p 30, the former term relates to powers "implied or inferred from the [express] words used, from customs and from the relations of the parties [principal and agent].” Id., § 7, comment c, p 29. The Uniform Partnership Act phrase "for apparently carrying on in the usual way the business of the partnership,” although it contains the word "apparent,” need not be read to exclude the implied-authority notion of powers that naturally ñow from the principal-agent relationship (in this case, the partnership). Accordingly, we find that §9 of the Uniform Partnership Act applies regardless of the bank’s lack of knowledge of the partnership relationship, and that any act of Goldman within the scope of his implied authority as a partner necessarily bound his co-partner Grosberg under that provision. _
As developed at trial, Grosberg had executed a power of attorney expressly authorizing Goldman to indorse and deposit Grosberg’s checks in the Manufacturers account. In addition, Grosberg entrusted Goldman with responsibility for the receipt and disposition of incoming shopping center checks.
In light of the partnership relationship, we easily conclude that Goldman had implied authority to indorse all incoming checks on behalf of Grosberg, Grosberg doing business as Chatham Fox Hills Shopping Center, and Chatham Fox Hills Shopping Center. The possibility that Goldman may have secretly intended at the time of indorsement to embezzle the funds cannot detract from his authority to affix indorsements, since at that time he was "apparently carrying on in the usual way the business of the partnership.” MCL 449.9(1); MSA 20.9(1). Thus, as to the mere act of indorsement, we hold that Goldman was properly authorized to affix appropriate signatures on behalf of Grosberg and the shopping center.
Having determined that Goldman was autho rized to indorse the checks at issue, the question remains whether Goldman’s subsequent conduct in depositing the checks in the account at defendant bank somehow vitiated that authority, so as to trigger the bank’s conversion liability under the Uniform Commercial Code. Where corporations are involved, we recognize that authority to deposit checks payable to corporate payees into individual accounts cannot normally be implied, and that a bank accepting such checks does so at its peril. See, e.g., Sherriff-Goslin Co v Cawood, 91 Mich App 204; 283 NW2d 691 (1979); Aetna Casualty & Surety Co v Hepler State Bank, 6 Kan App 2d 543; 630 P2d 721 (1981). As stated by the court in Aetna Casualty, p 549: " 'Any bank or person who receives a check on the indorsement of such an agent assumes the risk of the agent’s authority.’ ”
While we adhere to the foregoing principle, we find the corporate cases to be distinguishable on several grounds from the situation at hand. First, in the former cases, it is uniformly established that the embezzling employee had no authority, express or implied, to indorse on behalf of the corporate employer. Absent such authority to indorse the checks in the first place, obviously there could be no authority to then deposit the checks into the employee’s personal account.
Second, in the corporate cases, the diverted checks were deposited in the embezzler’s individual account, in which the corporate employer had no proprietary interest whatsoever. Thus, a complete separation of ownership and possession occurred such as to raise a red flag in the mind of a reasonable depositary bank teller.
Finally, the corporate cases involve the diversion of checks in which the embezzler had no ownership interest or objective claim of right. This factor reinforces the inference of irregularity and negates the possibility of implied authority.
In sum, the typical corporate embezzlement case involves an employee with no blanket authority to indorse, a diversion to a personal account in which the corporate employer has no proprietary interest, and diverted checks in which the embezzler has no proprietary interest. By contrast, the instant case involves a partner with general authority to indorse, a diversion to a joint account in which the complaining payee had an equal proprietary interest, and diverted checks in which the embezzler (Goldman) had a partial proprietary interest. Taken as a whole, the present circumstances are not so inconsistent with "carrying on in the usual way the business of the partnership” that Goldman’s authority to make the deposits at issue cannot be implied under MCL 449.9(1); MSA 20.9(1). Rather, we find that Goldman’s inherent authority as a partner extended by implication to the deposit of partnership checks in an account ostensibly maintained in both partners’ names.
In challenging the commercial reasonableness of the bank’s conduct in accepting the checks for deposit, plaintiff contends that the form of the account — joint tenancy with full right of suvivorship — was inappropriate for the deposit of business checks and thus should have given the bank notice of Goldman’s misconduct. Although we need not reach the commercial reasonableness issue because we rest our decision on partnership grounds, we note in passing that the form of the account is less significant to our analysis than the fact that the account was captioned in both partners’ names. For example, while a bank might reasonably believe the joint tenancy format to be an expedient interim arrangement pending the formalization of a partnership, it is difficult to conceive of a situation where a bank could reasonably believe that an individual account is the authorized format for a partnership account.
To the extent that the form of the account also bears on the issue of Goldman’s implied authority, we find the joint format to be not so blatantly inconsistent with "apparent partnership purposes” as to defeat the implication of Goldman’s authority under the other factors discussed above. Moreover, since Goldman apparently was authorized to deposit checks payable to the shopping center entity into Grosberg’s individual account at Manufacturers, we also reject the argument that Goldman lacked authority to deposit such business checks to an individual account captioned in both their names.
Finally, as to the checks on which Goldman provided no indorsement, we agree with the rulings of both courts below that the defendant bank properly supplied the missing indorsements pursuant to MCL 440.4205(1); MSA 19.4205G). Apart from the missing indorsement, we apply to those checks the identical analysis set forth above to conclude that Goldman had implied authority to deposit them in the joint account.
To summarize, Grosberg’s conversion claim requires proof that Goldman forged the indorsements on the deposited checks. Because of Goldman’s implied authority both to indorse incoming checks and to deposit them in an account created in a manner consistent with "apparent partnership purposes,” however, we conclude that no forgery occurred. Under this unusual set of facts, therefore, the defendant bank is free from liability in conversion.
Ill
In conclusion, we stress the limited reach of today’s holding, which depends so much on the unusual facts presented and the unique principles applicable to partnerships. By no means should our holding be interpreted to give free rein to the banking industry to ignore facial irregularities in items received for deposit. Nor do we approve of a procedure that permits an account to be opened, and checks deposited into it, in the absence of the authority of a joint owner of the account. While those practices are not per se unreasonable, we note that any bank following such procedures does so at its peril. The defendant bank prevails here only because it took the risk of Goldman’s authority and won, not because its conduct was necessar ily acceptable or reasonable. Under these specific circumstances, while we agree with the equitable principle that "as between two innocent parties the one who made a loss possible is the one who should suffer,” on balance, it is Grosberg and not the bank who is less innocent and who must bear the burden of his misplaced trust.
Affirmed.
Williams, C.J., and Ryan, Brickley, and Cavanagh, JJ., concurred with Boyle, J.
Levin, J.
The defendant, Michigan National Bank-Oakland, opened a joint checking account in the names of Sheldon Goldman and plaintiff Merwin K. Grosberg. Goldman forged Grosberg’s signature on the signature cards. Goldman then deposited to the joint account checks made out to Grosberg, Grosberg doing business as Chatham Fox Hills Shopping Center, Chatham Fox Hills Shopping Center, or Goldman. Over a period of 18 months, over $100,000 was deposited to the joint account. Approximately $44,000 was paid out of the account for purposes of Chatham Fox Hills Shopping Center and the balance was diverted by Goldman for his own uses.
The trial judge found that Grosberg and Goldman were partners in Chatham Fox Hills Shop ping Center and dismissed Grosberg’s complaint. The Court of Appeals affirmed. This Court affirms the Court of Appeals on the ground that Goldman, as a partner, had the authority to indorse checks representing partnership funds and deposit them to the joint account.
The opinion of the Court elides Grosberg’s claim that the bank is responsible for the defalcation because it opened a joint account in Grosberg’s and Goldman’s names on the basis of Goldman’s false representation that one of the signatures on the signature cards was Grosberg’s.
The bank could not properly open a checking account in Grosberg’s name without his authority. Nor could it properly open a checking account in Grosberg’s and Goldman’s joint names without Grosberg’s authorization. A bank officer acknowledged that the bank would not have opened an account in a partnership name without the signatures of both partners. In opening the joint Grosberg-Goldman checking account, the bank chose to rely on Goldman’s representation that the signature on the signature cards purporting to be Grosberg’s signature was in fact his signature, rather than requiring that Grosberg sign in the presence of a bank officer.
If the bank had not relied on Goldman’s representation of the validity of Grosberg’s signature in opening the joint account, Goldman could not have indorsed and deposited funds belonging to Chat-ham Fox Hills Shopping Center and Grosberg to the joint account and withdrawn funds from that account for his personal purposes. Thus, but for the bank’s decision to open the joint account in reliance on Goldman’s representation, Goldman would not have been able to so misappropriate monies belonging to Chatham Fox Hills Shopping Center and Grosberg.
The bank, having,, facilitated the misappropriation of the money by choosing to rely on Goldman’s representation in opening the joint account, is responsible for the resulting loss.
The Grosberg-Goldman joint account cannot properly be characterized a partnership account either on the ground that it was a joint account and Grosberg and Goldman were partners or on the ground that partnership money was deposited in the account under the circumstances that the account was opened on forged papers that the bank chose to rely on and that Grosberg was unaware of the joint account and did not authorize that it be opened. Grosberg’s name on the joint account added nothing; for all practical purposes, the "joint account” was Goldman’s personal account.
In opening the Grosberg-Goldman joint account in reliance on Goldman’s representation of the validity of Grosberg’s signature, the bank did not rely on any authority Goldman may have had as Grosberg’s "partner;” only after the commencement of this litigation did the bank’s lawyer obtain information that is the foundation of the Court’s decision today. To the extent that today’s decision rests on the dubious finding that Goldman was more than an ordinary agent, servant, or employee entrusted with the authority to make deposits, but was a partner, the result is adventitious.
The opinion of the Court in effect relieves a bank from liability for allowing a partner to:
(i) open a joint bank account in the names of himself and his partners, or a partnership account, by forging the signatures of all the partners, either as joint signatories on a joint account or on papers authorizing the opening of a partnership account, and
(ii) deposit partnership money in the account, and
(iii) withdraw the funds on his own signature, thereby transforming partnership money into the personal funds of the dishonest partner.
If this can be done with partnership money, it might also be done by a dishonest co-trustee with trust money. The dishonest co-trustee opens a joint account in the names of himself and the other trustees, or a trust account, forging whatever signatures on signature cards or other papers are needed to open the account. The dishonest co-trustee, according to the rationale of the opinion of the Court, is authorized, as a co-trustee, to indorse and deposit trust money into the account. A joint account is a trust account either because all the co-trustees are joint signatories (albeit on forged signatures) or because trust money has been deposited to the account. The bank is protected because the dishonest co-trustee had the authority to indorse and deposit the checks. Trust money, like partnership money, would thus be transformed into the personal funds of the dishonest person without any responsibility on the part of the bank.
The opinion of the Court states that it does not approve of a bank opening a bank account "in the absence of the authority of a joint owner of the account” and that a bank that does so acts "at its peril.” This bank did so and yet prevails because the Court concludes that Goldman had the authority to indorse and deposit checks to a partnership account and the Court characterizes the joint account as a partnership account although it was labeled a joint account, the bank did not know that it was a partnership account — if it was, and Grosberg’s signature on the signature card was forged. Under the Court’s analysis, the dishonest partner will always have the authority to indorse and deposit partnership checks to such a "partnership account” and the bank will never be at peril.
The Court adds that although the bank made the loss possible, Grosberg "is less innocent” than the bank and must therefore "bear the burden of the misplaced trust.” The Court does not state why Grosberg is less innocent than the bank. If it is because Grosberg allowed Goldman to receive and make deposits of checks payable to Grosberg or Chatham Fox Hills Shopping Center, then a bank will not be at peril if it allows any ordinary agent, servant, or employee, authorized by the payee to make deposits, to open a joint bank account with forged signature cards. If it is because Grosberg gave Goldman a power of attorney (of which the bank was not aware) on another bank account with a different bank, then, without regard to the terms of the power of attorney, a person who signs a power of attorney is at his peril, not the bank.
I would reverse and remand for further proceedings consistent with this opinion. ;
Kavanagh, J., concurred with Levin, J.
The account contained a little over $1,000 when Grosberg discovered the diversion and ordered the account frozen.
See Burns v Gonzalez, 439 SW2d 128 (Tex Civ App, 1969) (finding insufficient evidentiary basis for partner authority), for a discussion of the Texas counterpart to MCL 449.9(1); MSA 20.9(1), in which the court alluded to principles of both implied and apparent authority.
Our interpretation of MCL 449.9(1); MSA 20.9(1) to encompass implied authority is strengthened by the fact that no other provision of the Uniform Partnership Act specifically incorporates the common-law principle of implied authority into that statute. See MCL 449.1 et seq.; MSA 20.1 et seq.
The Restatement of Agency, 2d, also recognizes another category of authority, "inherent agency power,” defined as "the power of an agent which is derived not from authority, apparent authority or estoppel, but solely from the agency relation and exists for the protection of persons harmed by or dealing with a servant or other agent.” 1 Restatement Agency, 2d, §8A, p 36. The comment on that section includes within the scope of inherent agency power the situation "in which a general agent does something similar to what he is authorized to do, but in violation of orders.” Comment b, p 38. To the extent the following textual discussion focuses on authority derived from the partnership relation, as distinct from Grosberg’s manifestations, we incorporate the notion of "inherent agency power” into our view of implied authority.
On cross-examination, Grosberg testified that even though no bank account was captioned in the shopping center name, he expected checks payable to "Chatham Pox Hills Shopping Center” to be deposited to the Manufacturers account. Since Goldman’s power of attorney made no reference to instruments payable to the shopping center entity, it appears that Goldman’s actual authority may well have exceeded the authority recited in the power of attorney.
Quoting from Brady on Checks (5th ed), § 23.17, pp 23-39.
See, e.g., Sherriff-Goslin, supra, 91 Mich App 206; Aetna Casualty, supra; Womack Machine Supply Co v Fannin Bank, 499 SW2d 917, 918 (Tex Civ App, 1973), rev’d on other grounds 504 SW2d 827 (Tex, 1974).
Unlike implied authority in the partnership context, no authority to indorse corporate instruments is implied in corporate employees. See Brady on Checks (5th ed), § 23.17, pp 23-38.
The instant case is distinguishable from McIntosh v Detroit Savings Bank, 247 Mich 10; 225 NW 628 (1929), in which the deposit of partnership checks into a partner’s individual account was held to constitute notice of the misappropriation.
Although plaintiff also challenges the commercial reasonableness of the bank’s conduct in allowing the joint account to be opened by only one signer, we agree with the Court of Appeals that the issue has not been preserved on appeal. See 113 Mich App 619.
The section provides:
"A depositary bank which has taken an item for collection may supply any indorsement of the customer which is necessary to title unless the item contains the words 'payee’s indorsement required’ or the like. In the absence of such a requirement a statement placed on the item by the depositary bank to the effect that the item was deposited by a customer or credited to his account is effective as the customer’s indorsement.”
While it appears that plaintiff may have included a negligence claim in his complaint, we decide this case addressing the conversion claim which has been the only theory of recovery briefed and argued on appeal. The "commercial reasonableness” issue raised by plaintiff relates solely to the defense to conversion liability provided by MCL 440.3419(3); MSA 19.3419(3). Accordingly, we do not address the possibility of negligence liability under these or similar circumstances.
First National Bank of Louisville v Progressive Casualty Ins Co, 517 SW2d 226, 229 (Ky, 1974).
The trial judge said that the partnership tax returns filed and tax losses taken by Grosberg and Goldman were “certainly highly pre sumptive evidence that a partnership existed.” The filing of partnership tax returns is, however, an entirely neutral factor in determining whether there is a partnership. The Internal Revenue Code defines "partnership” to include a "syndicate, group, pool, joint venture, or other unincorporated organization through or by means of which any business, financial operation, or venture is carried on, and which is not, within the meaning of this title, a corporation or a trust or estate.” 26 USC 761(a). Thus "[t]he term 'partnership’ is broader in scope than the common law meaning of partnership, and may include groups not commonly called partnerships.” 26 CFR 1.761-l(a). Relationships involving cotenants, employers and employees or independent contractors, and debtors and creditors have been considered partnerships for tax purposes. See 1 Willis, Pennell & Postlewaite, Partnership Taxation (3d ed), §§ 3.02, 3.05, 3.07.
Grosberg v Michigan National Bank Oakland, 113 Mich App 610; 318 NW2d 490 (1982).
Grosberg alleged in his complaint that the bank’s failure to properly authenticate the signature card was in derogation of reasonable commercial standards and demonstrated a lack of due care and diligence. The Uniform Commercial Code does not relieve a bank of its common-law duty to exercise ordinary care. Bank of Southern Maryland v Robertson’s Crab House, Inc, 39 Md App 707; 389 A2d 388 (1978); 6 Anderson, Uniform Commercial Code (3d ed), § 4-103:9.
A third person taking commercial paper indorsed by an agent acts at his peril that the principal will be bound by the transaction. 6 Anderson, supra, § 3-404:6. A bank is negligent when it relies on the instructions of a purported agent without confirming his authority. Taylor v Equitable Trust Co, 269 Md 149; 304 A2d 838 (1973).
The Court holds that Goldman had implied authority to indorse and deposit partnership checks into the joint account, but acknowledges that the bank had no knowledge of the partnership relationship. If, however, the Grosberg-Goldman relationship was in fact a partnership, the bank has acted without confirming Goldman’s authority, let alone the existence of the partnership.
The checks deposited into the joint account were payable to Grosberg, Grosberg doing business as Chatham Fox Hills Shopping Center, Chatham Fox Hills Shopping Center, or Goldman. The Court finds it unnecessary to determine if accepting such checks for deposit into a joint account was commercially reasonable because the Court rests its decision on partnership grounds. The commercial reasonableness issue, however, should be reached. That a partner may have the authority to conduct banking transactions on behalf of his copartners does not necessarily relieve a bank of its duty to act with commercial reasonableness and ordinary care in confirming that authority.
We recognize that banks often choose not to confirm authority and authenticity in every transaction and that making such choices may even he good business practice. The question, however, is not whether the bank’s overall policy is wise from a business standpoint, but, rather, whether it has acted with reasonable care in its dealings with the particular customer. The bank may establish as many or as few safeguards in dealing with customers as it desires — that is a business judgment. But since the bank is generally in the best position to guard against forgery, and is also in the best position to insure and spread costs, it generally should bear the risk of loss. See Calabresi, Some Thoughts on Risk Distribution and the Law of Torts, 70 Yale L J 499, 549-551 (1961).
The bank cannot avoid responsibility for the loss by relying on its right to supply missing indorsements where it has failed to exercise ordinary care in opening the account; similarly, that the bank has allowed withdrawals on signatures matching those on the signature card is irrelevant where the signature card itself was accepted under circumstances amounting to negligence. Bullis v Security Pacific Nat’l Bank, 21 Cal 3d 801; 148 Cal Rptr 22; 582 P2d 109 (1978).
In Bullis, an estate co-executor opened a checking account for estate purposes. Bank policy required two signatures for withdrawals from the account, but the bank officer who opened the account failed to note this on the signature card. The co-executor subsequently misappropriated almost $250,000 with checks bearing only his signature. The Supreme Court of California held that the bank had breached its duty of care and was responsible in damages to the heirs of the estate.
In the instant case, the record shows that the bank would not have opened an account in a partnership name without requiring documentation of Goldman’s authority to act on behalf of the "partnership.”
The decision of the Court absolves the bank from legal liability for failure to follow its own policy and what is well known to be general banking industry practice. It is odd that the bank is relieved of liability on the basis of a finding that Grosberg and Goldman were partners although the account was not styled "partnership” but rather "joint with right of survivorship.” | [
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] |
Sherwood, J.
The plaintiffs were merchant tailors and did business in Detroit. They were employed to make, and did make, an overcoat for the defendant, the agreed price for which was to be sixty dollars. The coat was made like the sample designated by the defendant at the time it was ordered, and when completed, which was in good time, the plaintiffs sent it to the defendant at his house.
In a day or two thereafter it was returned to the plaintiffs, to be made a little larger, which was done by plaintiffs, and in a few days thereafter again sent to defendant at his house. Defendant returned it, saying it was not heavy enough for him. Plaintiffs then showed him the sample overcoat, and that it was completed according to the contract. The plaintiffs, however, told him they could make it heavier, and did so, and again sent the coat home. The next morning defendant sent it back with a message saying he did not want it, and when plaintiffs saw him a few days thereafter, at his office, he informed them he “ did not wish for a coat, for he had bought a ready-made one.” He then refused to take the coat and pay for it. The evidence shows it was well made, and a reasonably good fit. The plaintiffs brought suit in assumpsit, and declared on all the common counts and specially upon the contract. The case was tried at the circuit on appeal before a jury, and the plaintiffs recovered a judgment of $60. The defendant brings error.
Rasch was the only witness sworn, and all the testimony given upon the trial was by the plaintiff. Rasch testified to the facts above stated, and at the close of the trial the court charged the jury that, if they believed Mr. Rasch, the plaintiffs had made out a prima facie case, and their verdict should be for the plaintiffs. He also further charged the following: “ The defendant has not seen fit to come in here and offer evidence, or try the overcoat on in your presence, or bring experts to show that it was not a good fit. Now, that is his privilege. If his attorney was satisfied, or if he thought that the plaintiff did not make out a good case, he was not obliged to call Mr. Bissell; but I charge you that, if you believe Mr. Easch, your verdict will be for the plaintiffs, for Mr. Easch, for $60, until the defendant brings in evidence here to overcome that testimony.”
These charges were excepted to. They are not erroneous. They were fully warranted by the testimony in the case. The evidence alluded to therein stands undisputed, and, if believed by the jury, their duty was not too strongly indicated by the court. This disposes of defendant’s first, second, fourth, fifth, seventh, tenth and eleventh assignments of error.
There was no testimony to support the defendant’s third request to charge, and no error was committed in its refusal.
That portion of the charge contained in defendant’s ■eighth assignment of error, wherein the court states what was comprehended in the order for work at plaintiff’s store, was unobjectionable, but if erroneous it could not have harmed the defendant.
The charge in the twelfth assignment, we think, was supported by the evidence in substance.
The remaining assignment assumes the claim made by the plaintiffs is within the Statute of Frauds. This is a mistake. That question is not involved in the case. The testimony clearly shows that the property contracted for was delivered to the defendant in pursuance of the contract, with which it complied. "Whatever changes were afterwards made in the garment were so made at the request of the defendant, and since that time plaintiffs have held it subject to the disposition of the defendant.
"We find no error in the record, and the judgment must be affirmed with costs.
The other Justices concurred. | [
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] |
Per curiam.
Delators ask a mandamus the purpose of wbicb is to give effect to a stipulation signed by tbe parties to a litigation pending in tbe Superior Court of the city of Detroit, and wbicb was to settle and discontinue such litigation. It seems that a sum of money was paid when tbe stipulation was signed, but tbe party receiving tbe money claims that bis signature was improperly obtained, .■and be refuses to abide by it, though be has not returned the money. Delators claim that tbe stipulation is not successfully impeached, and they also claim that it is affirmed by tbe money not being returned. Tbe judge of the Superior Court refused to give effect to tbe stipulation by directing a discontinuance to be entered.
The case is a peculiar one and involves somewhat complicated facts, but we agree with respondent that the questions arising could not be determined’in favor of the relators on .a summary bearing. The parties were entitled to have tbe question of the settlement tried upon a regular issue, and to ,submit tbe issue to a jury if they' saw fit to do so. The stipulation, if its validity was contested, should be brought into tbe case by plea ; not by motion.
Writ denied. | [
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] |
Per Curiam.
The record tends to show that Mrs. Taylor was not in bona fide possession but was a mere tortious intruder.
But assuming’ it to be otherwise, there is no evidence that the defendant committed an assault and battery upon her.
[The judgment is reversed.] | [
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Sherwood, J.
The bill in this case is filed to compel a release by the executors and Lyman D. Norris, of their interest in the north half of lot 14 in block 7 of Warren and Bronson’s second subdivision of the city of Big Bapids. Separate demurrers were filed by the executors and the defendant Norris; and the demurrers having been overruled the bill was taken as confessed by all the defendants; and tbe circuit judge after the hearing decreed to the complainant the relief prayed in her bill. From that decree the executors and the defendant Norris took an appeal to this Court.
The complainant shows by her bill that in 1867 George B. Warren, whose residence was at Troy, New York, and Chauncy P. Ives owned in common a tract of land in the city of Big Bapids, including said lot 14, Warren owning two-thirds and Ives owning the other one-third of the same; that on the 16th day of October, 1867, Ives conveyed Ms one-third interest in the said lands to Stephen Bronson,, of Big Rapids, and after the purchase by Bronson he agreed with Warren that they would sell said lands to persons who-should desire to purchase, and give their joint executory contracts on such sales when made; and it was further understood between them, and in pursuance of such understanding, Warren directed Bronson to sign and execute such contracts ©n Ms behalf, as he might deem for the best interests of the parties; that a large number of sales of lots-were thus made by Bronson for himself and said Warren, he acting as the agent in making the same for Warren;, and that among the sales made and contracts given was on© to William T. Latham, of the north half of lot 14, it being the lot in question. It was made on the 1st day of March, 1871. By the terms of this contract, Latham was to have immediate possession of the premises. Upon the execution thereof he took such possession and made valuable and permanent improvements thereon. He was to pay $300 for the parcel ($125 at date of contract, and the remainder in three equal annual payments thereafter, with annual interest at ten per cent.); and Warren and Bronson, on receiving full payment of the purchase price and interest, were to execute to Latham a good and sufficient warranty deed of the premises. The terms of the contract were to apply to the heirs and assigns of the parties. Warren’s-name was signed by Bronson.
On the 15th day of June, 1872, Latham sold the lot and all Ms interest therein under his contract with Warren and Bronson to Elwood Graham, who took possession of the lot and made valuable, expensive and permanent improvements thereon.
The bill further avers that Stephen Bronson, on the 2d day of October, 1872, conveyed his interest in the lotto the Big Rapids Improvement & Manufacturing Company, and that such conveyance was with the full knowledge and consent of George B. Warren, and under an agreement with Mm that all of the contracts executed by Bronson for himself and Warren, including the contract with Latham, should have full force and effect by all parties interested therein, as the joint contract of said Warren and said company ; that all the terms and conditions of the Latham contract 'were fully performed on or about the 7th day of December, 1874, by paying all principal and interest accrued thereon to Warren and the company.
It further appears by said bill .that said Company did, on or about the 16th day of August, 1875, convey its undivided one-third of said lot to said Elwood Graham, who then held the interest of said Latham in the contract for the purchase of said lot; that Elwood Graham entered into possession of said lot, and so continued until about the 20th of January, 1880, when he sold the same to Ursula Graham, and she immediately took possession thereof under said sale and made valuable and permanent improvements thereon ; that on the 17th day of August, 1882, Ursula- Graham sold and conveyed the premises to the complainant, and that she went into possession of the lot, and was so in possession at the time of filing her bill of complaint, and she avers she is the equitable owner thereof.
It is further stated in the bill that George B. Warren, on the 8th day of May, 1879, died, leaving a last will, and that defendants, George B. Warren, John A. Manning and John B. Pierson were appointed executors, and received their letters from the judge of probate July 9, 1879; and that they qualified and entered upon the discharge of their duties as such; that the deceased devised all his real estate interests to his executors in trust for certain purposes, and that the said GeorgeB. Warren, Jr., Emily Warren, Charles S. Warren, John E. Warren and Mary Manning are the beneficiaries under the declaration of trust in the will, so far as relates to the real estate; that said executors claim to own in fee the undivided two-thirds of said lot, and threaten to dispossess complainant by taking legal proceedings.
The bill further avers that on the 16th day of October, 1867, Bronson gave a mortgage to Ives upon his interest in the property purchased, which mortgage covered the east tier of lots in block seven, the same being numbered from 9 to 16; that on the 15th. of July, 1869, said Ives released, among others, lot 14 from the operation of said mortgage ; that on September 1st, 1875, George B. Warren became • the owner of the mortgage .and debt secured thereby, and subsequently commenced a foreclosure of the same, and in describing the property in the bill of complaint, excepted out-lot 14; that said foreclosure was completed after Warren’s death by his executor, and that on or about June 20, 1880, a sale was made thereunder of the mortgaged property, said defendant Lyman D. Norris being the purchaser thereof; that said Norris claims no beneficial interest in the premises purchased by him on said sale, but claims to hold the title to the same in trust for the estate of George B. Warren. The bill further charges that said Norris claims that under and by virtue of his purchase at said mortgage sale he has an interest in an undivided one-third part of the north half of lot 14; and that such claim is a fraud upon complainant and a cloud upon her title. Complainant further claims she has requested said defendant Norris and said executors to release to her their claims upon said premises, and they refused so to do.
The defendants who have appeared rely in this court upon the points made in their demurrers to sustain their defense.
It will be noticed that the complainant does not ask that defendants be decreed to give a deed with warranty, but simply a quitclaim or release of their interest; and it is difficult to see why the case made by the bill is not an equitable one and one entitling complainant to the relief she prays. It is said complainant does not seek a conveyance to her of the land, but only a release of defendants’ claim thereto. The bill states the claim made by defendants is, by defendant Norris, the title to one-third of the lot; and by the executors, the title to the other two-thirds. Such a claim under our statute [How.' St. § 5653] can be released only by deed.
The relief prayed is not inconsistent with the facts stated in the bill; neither is it contrary to the practice of a court of chancery, upon the facts stated, to grant relief.
The company conveyed to Latham’s assignee the interest transferred to it by Bronson, as it was equitably required to do, and as it had promised to do in pursuance of the arrangement between Bronson and Warren, when the company bought the property, and it was a fraud upon the rights of the complainant, who is assignee of Latham, when the representatives of the Warren interest refused to fulfill Warren’s agreement to convey. It appears he, as well as the company, had received the consideration paid by the complainant and her assignors for the lot. She held the equitable interest in the premises, was in possession of the property under her equitable interest, and was entitled to have from the defendants the evidence of her legal title. But instead of receiving it when she made her request, the defendants not only refused to make it to her, but actually denied her right thereto, claiming to be themselves owners of the property.
. The statements in the bill relating to the. mortgage sale and the interest purchased by Norris show a claim made to the property in question without any sufficient foundation. We see no difficulty, under the facts stated in the bill, in bringing the case within a very familiar and well-recognized head of equity jurisdiction. The fraud charged is alone sufficient upon this point.
It is claimed here that Bronson was not legally authorized to make the Latham contract for Warren. This objection comes entirely too late. Equity will not allow a party to receive the full benefit of a contract made by another for him, and then permit him to repudiate the contract thus made. It appears from the bill that Warren not only knew all about the contract made, but had verbally authorized Bronson to make it; had recognized it as his arrangement with the company, and had actually taken all the benefit he could derive from it. It nowhere appears he ever repudiated the contract while living, and his executors cannot be permitted to do it now that he is dead.
The case as stated in the bill does not fall within the Statute of Frauds referred to by counsel. We think the bill sufficiently avers possession in plaintiff at tbe time of commencing the suit; that the bill is sufficiently specific in all its material averments, and is not subject to,the infirmities specified in the demurrers.
The decree of the circuit court must be affirmed with costs.
Campbell J. concurred. | [
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Champlin, J.
Complainant filed his bill of complaint in the circuit court for the county of Wayne, in chancery, on the 21st day of October, 1882, to obtain a divorce. He alleged# that he was married to the defendant on or about September 27, 1882, and had never lived or cohabited with her since; that the marriage was consummated by force, duress and threats of imprisonment, against his will and while he was under the influence of intoxicating liquor and unable to assert his will or successfully oppose the mar riage which was forced upon him. He also charged, upon information and belief, that the defendant had been, and then was, a woman of unchaste character, and had been guilty of illicit carnal intercourse with a person named during the months of July and August, 1882, before the alleged marriage, which facts were wholly without the knowledge of complainant until within one week then passed. He prayed that defendant might answer, but not under oath, and that the marriage might be dissolved and a divorce decreed. The defendant answered, admitting the marriage but denying that it was consummated by force, duress and without his consent or against his will or while he was under the influence of intoxicating liquors to such an extent as to prevent the exercise of his will in a rational and intelligent manner. She also denied the charge of illicit intercourse with any person other than complainant. Replication was filed, and the parties proceeded to take proof under a stipulation, in open court, without a jury.
The cause was heard on pleadings and proofs and the court, on the 1st day of October, 1883, became satisfied, as appears, that the pleadings and proofs did not make out a cause for divorce, but that the proofs did warrant a decree for annulment of the marriage contract, and gave complainant leave to amend the prayer of his bill by withdrawing the prayer for divorce and inserting in the place thereof a prayer that the marriage be annulled and declared void, and without waiting for the amendment to be made or any issue formed in relation thereto, the court proceeded to render a decree that the marriage between the complainant and defendant be annulled and declared void on the ground of fraud, duress and intoxication. This decree appears to have been filed with the register on the 3d day of October, 1883, and the amendment to the bill was filed on the 5th day of October, 1883.
There is a material difference between a bill for a divorce from the bonds of matrimony and one to annul the marriage contract, not only in the consequences that arise from "a decree pronounced in the two eases, but in the method of proceeding.
Where a bill is filed to annul the marriage contract for any cause except the physical incapacity of one of the parties, and the defendant denies the allegations of the bill so as to raise an issue as to the legality of the marriage, the statute requires that the issues so raised shall be tried by a jury of the country. 2 Comp. L. § 5068. [How. St. § 6622.] We do not consider this statute mandatory upon the court and parties in all cases, but as securing to either party the right, if he chooses to exercise it, to have the issues tried by a jury. The parties will be deemed to have waived a trial by jury unless, after the filing of replication, one of them applies to the court, on notice to the adverse party, for a feigned issue. This has been the uniform practice in the courts of New York from whose statutes ours, in this respect, were - adopted. 2 Barb. Ch. Pr. 251. The proceedings in this case were of such a nature as to deprive the defendant of the exercise of this right and cannot be upheld. The amendment allowed changed the entire nature of the relief sought, and no statute or practice, however liberal with regard to amendments, will justify it.
We have carefully considered the proofs in this cause. It would answer no good purpose to review or comment upon them in this opinion. Suffice it to say that we are all of opinion that the complainant entirely failed to substantiate the charges alleged in his bill of complaint: and it must be dismissed with costs of' both courts.
A decree will be entered here reversing the decree of the court below and dismissing the bill of complaint with costs of both courts with an extra allowance to defendant of fifty dollars.
The other Justices concurred. | [
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Per Curiam.
The plaintiff sued the defendant hospital, alleging that it had negligently provided certain medical services. The hospital successfully moved for accelerated judgment, persuading the trial court that the limitation period for the plaintiffs action against it was two years. GCR 1963, 116.1(5). The Court of Appeals affirmed. Adkins v Annapolis Hospital, 116 Mich App 558; 323 NW2d 482 (1982). Asked to review this decision, we conclude that the Court of Appeals was correct, and we likewise affirm.
I
The facts are not in dispute. It is agreed that the plaintiff was injured when he fell at home on December 3, 1977. He was taken to the emergency room of the defendant hospital. X-rays were taken of the plaintiffs foot, and he was given an elastic bandage. He was not told that he had fractured his foot. The plaintiffs discomfort discontinued. On January 17, 1978, he visited the defendant podiatrist, who accurately diagnosed a broken foot. On January 21, 1980, the plaintiff filed suit against the hospital and the podiatrist. It is now agreed that this suit was filed more than two years, but less than three years, after the plaintiff’s cause of action accrued.
II
The limitation period for a malpractice action is two years. MCL 600.5805(4); MSA 27A.5805(4). The limitation period for other negligence actions is three years. MCL 600.5805(8); MSA 27A.5805(8).
In the Court of Appeals, the plaintiff argued unsuccessfully that subparagraphs (c)-(g) of his complaint were allegations of ordinary negligence, not medical malpractice. The plaintiff does not offer that argument in this Court, instead arguing in favor of a general rule that "there is a three-year period of limitations applicable to actions against hospitals.” The plaintiff believes this to be the teaching of Kambas v St Joseph’s Mercy Hospital of Detroit, Michigan, 389 Mich 249; 205 NW2d 431 (1973). In the plaintiffs view, "the remaining question is whether Kambas, supra, continues to be the law of this jurisdiction.”
In Kambas, the plaintiff sued a hospital, alleging that registered nurses, employed by the hospital, had negligently treated the plaintiff. The hospital sought to avail itself of the two-year limitation period. This Court determined that a nurse was not a professional of the sort who could be guilty of malpractice; the hospital, whose liability was predicated on a theory of respondeat superior, could be in no better position than the employees through whom liability was traced. Thus, reasoned this Court, the hospital could not invoke the protection of the two-year limitation period.
The conclusion that a nurse could not be guilty of malpractice was drawn from a common-law rule explained in Richardson v Doe, 176 Ohio St 370; 27 Ohio Op 2d 345; 199 NE2d 878; 8 ALR3d 1331 (1964). This Court then examined three provisions of the Revised Judicature Act, finding therein no sign that the common law had been altered in Michigan. RJA § 2912 was found to address itself exclusively to the problem of the charlatan who masquerades as a professional. RJA § 5805 was said to be "nothing more than compilation of existing limitations with no change in time peri ods.” RJA § 5838, as it then read, was said to be the embodiment of "the 'last treatment’ rule of accrual.”
In 1975, approximately two years after this Court’s decision in Kambas, the Legislature amended RJA § 5838, so that it now reads:
"(1) A claim based on the malpractice of a person who is, or holds himself out to be, a member of a state licensed profession, intern, resident, registered nurse, licensed practical nurse, registered physical therapist, clinical laboratory technologist, inhalation therapist, certified registered nurse anesthetist, X-ray technician, hospital, licensed health care facility, employee or agent of a hospital or licensed health care facility who is engaging in or otherwise assisting in medical care and treatment, or any other state licensed health professional, accrues at the time that person discontinues treating or otherwise serving the plaintiff in a professional or pseudoprofessional capacity as to the matters out of which the claim for malpractice arose, regardless of the time the plaintiff discovers or otherwise has knowledge of the claim.
"(2) An action involving a claim based on malpractice may be commenced at any time within the applicable period prescribed in sections 5805 or 5851 to 5856, or within 6 months after the plaintiff discovers or should have discovered the existence of the claim, whichever is later. The burden of proving that the plaintiff, as a result of physical discomfort, appearance, condition or otherwise, neither discovered nor should have discovered the existence of the claim at least 6 months before the expiration of the period otherwise applicable to the claim shall be on the plaintiff. A malpractice action which is not commenced within the time prescribed by this subsection is barred.” (Emphasis supplied.) 1975 PA 142; MCL 600.5838; MSA 27A.5838._-
This Court had an opportunity to consider the. effect of 1975 PA 142 in Sam v Balardo, 411 Mich 405; 308 NW2d 142 (1981). In that case, this Court held that a legal malpractice suit is subject to the two-year limitation period. This Court cautioned that "we need not and do not decide whether actions against any professional groups, other than attorneys, are subject to the two-year period of limitations.” In deciding that attorneys could join physicians, surgeons, and dentists under the protective shield of the two-year limitation period, this Court again concluded "that reliance on the other sections of the Revised Judicature Act [including RJA §§ 2912 and 5838] for a definition of malpractice for purposes of § 5805(3) is erroneous,” since RJA § 5838 "still pertains to accrual periods and does not define malpractice for purposes of the two-year statute of limitations.” We did, however, observe that the 1975 PA 142 amendment of RJA § 5838 "provide[s] that a malpractice cause of action may be commenced against one of the enumerated state-licensed health professionals” within certain time limits:
"The [Sam] majority opinion in the Court, of Appeals concluded that the amendment to this section, by providing a cause of action in malpractice against nurses, was a legislative response to the Court’s decision in Kambas, supra. While that may be so, we are more inclined to the view that this amendment is some evidence of the legislative intent that health care providers subject to liability for malpractice actions be not limited to physicians, surgeons or dentists,” Sam, 411 Mich 421, fn 14.
Ill
In the present case, the Court of Appeals found the hospital to be protected by the two-year limita tion period. The Court of Appeals relied upon the 1975 PA 142 amendment of RJA § 5838, and observed that Sam did not consider whether the common law recognized a malpractice action against a hospital.
"Initially, we observe that hospitals are covered by the two-year statute of limitations for malpractice when a cause of action for malpractice is pleaded. In determining what kinds of malpractice are covered by the two-year limitation of MCL 600.5805(4); MSA 27A.5805(4), we must glean the legislative intent from the words of the statute, providing the statute is unambiguous on its face. Sam v Balardo, 411 Mich 405; 308 NW2d 142 (1981). While there is some question as to which professions are protected by the shortened period, the Legislature clearly indicated that it believed certain enumerated licensed health care professionals, including hospitals, were subject to the shortened limitations period, as it listed those professions in describing a shortened period for initiating actions after discovery of the alleged malpractice, MCL 600.5838; MSA 27A.5838. Although the Supreme Court has indicated that this list of covered professions is not exhaustive and does not reflect all those professions that the Legislature intended to cover (Sam, supra) we believe that the list of included professions reflects the Legislature’s intent to expand the class of individuals who may be sued for malpractice and to limit the time period for bringing a malpractice action against those individuals. To hold otherwise would render the language of § 5838 a nullity.
"At oral argument on appeal, plaintiffs counsel vigorously argued that the Supreme Court’s reasoning in Sam v Balardo, supra, requires application of a three-year limitation period in this action against a hospital. In Sam, however, the Supreme Court held that the common law recognized an action for malpractice against attorneys and that action, as any other common-law action for malpractice, was governed by the two-year limitation period of § 5805(3) [now § 5805(4)] of the RJA. The Supreme Court did not consider whether the common law or statute recognized a malpractice action against hospitals or what limitation period should be applied in such an action.
"More closely on point is Kambas v St Joseph’s Mercy Hospital of Detroit, 389 Mich 249; 205 NW2d 431 (1973), and the legislative reaction thereto. In Kambas, the Supreme Court held that the common law did not recognize a malpractice action against a nurse, so the three-year limitation for ordinary negligence, and not the two-year limit for malpractice, governed such an action. After Kambas, however, the Legislature amended § 5838 of the RJA, suggesting that it believed certain health care professions, including hospitals, should be protected by a two-year limitation period and by a shortened discovery period. We interpret Sam as the Supreme Court’s recognition that the amendment to § 5838, listing those health care professions, did not indicate that the Legislature intended to preclude a common-law malpractice action against unenumerated professionals, such as attorneys.
"We believe that the Legislature has clearly indicated that hospitals should be governed by the shorter, malpractice period of limitation and, accordingly, hold that where a. malpractice action is properly pleaded against a hospital the two-year limitation period of § 5805(4) applies.
IV
The Court of Appeals was correct. While it is true that RJA § 5838 is an accrual provision, not a definitional section, there can be no other meaning of this language other than that an "intern, resident, registered nurse, licensed practical nurse, registered physical therapist, clinical laboratory technologist, inhalation therapist, certified registered nurse anesthetist, X-ray technician, hospital, licensed health care facility, employee or agent of a hospital or licensed health care facility who is engaging in or otherwise assisting in medical care and treatment, or any other state licensed health professional” may be guilty of malpractice. Otherwise, there would be no reason to list those occupations in an accrual section. A malpractice action cannot accrue against someone who, or something that, is incapable of malpractice.
In Sam, we concluded that one still needed to look to the common law for guidance as to whether an attorney is capable of malpractice. Sam expressly reserved a decision "whether actions against any professional groups, other than attorneys, are subject to the two-year period of limitations.” We today hold, as suggested in Sam, that 1975 PA 142 evidenced a legislative intent to alter the common law and subject other health professionals to potential liability for malpractice. As we said in Sam, "1975 PA 142 subsequently amended MCL 600.5838; MSA 27A.5838 to provide that a malpractice cause of action may be commenced against one of the enumerated state-licensed health professionals.”
The Legislature having in this instance modified the common law, we affirm the Court of Appeals holding that the defendant hospital could invoke in this case the protection of the two-year limitation period.
Affirmed._
Williams, C.J., and Kavanagh, Levin, Ryan, Brickley, Cavanagh, and Boyle, JJ., concurred.
Adkins v Annapolis Hospital, lv gtd 417 Mich 1043 (1983).
The plaintiff alleged “[t]hat at all times pertinent hereto, all defendants owed the plaintiff a duty to properly diagnose, treat, render appropriate care and observation together with appropriate follow-up care in accordance with standard of practice. Notwithstanding such duties defendants did violate same in the following particulars:
"a) In failing to take appropriate x-rays;
"b) In failing to properly interpret and diagnose said x-rays;
"c) In failing to notify plaintiff of the results of said x-rays;
"d) In negligently not having systems to advise patients of x-rays interpretations after they had been found to be positive;
"e) In fraudulently concealing from plaintiff the fact that there were fractures present in his feet;
"0 In negligently failing to call plaintiff in after x-rays were interpreted as being positive;
"g) In negligently failing to refer plaintiff to appropriate orthopaedic physicians for care;
"h) In failing to properly care and/or treat plaintiff’s foot condition; "i) In failing to advise plaintiff of alternative forms of treatment;
“j) In failing to consider possibility and/or advisability of surgical intervention for care and treatment of plaintiff’s foot fracture;
"k) In failing to properly advise plaintiff of residual difficulties and to obtain plaintiff’s informed consent for methodologies of treatment;
"1) In failing to prescribe appropriate orthodics [sic] and/or biomechanical treatments for plaintiff’s foot condition;
"m) In negligently maintaining plaintiff on a weight-bearing regime.”
Prior to the effective date of 1978 PA 495, this provision was numbered MCL 600.5805(3); MSA 27A.5805(3).
Prior to the effective date of 1978 PA 495, this provision was numbered MCL 600.5805(7); MSA 27A.5805(7).
See fn 1.
MCL 600.101 et seq.; MSA 27A.101 et seq.
"(1) A civil action for malpractice may be maintained against any person professing or holding himself out to be a member of a state licensed profession. The rules of the common law applicable to actions against members of a state licensed profession, for malpractice, are applicable against any person who holds himself out to be a member of a state licensed profession.
"(2) Malpractice may be given in evidence in defense to any action for services rendered by the member of a state licensed profession, or person holding himself out to be a member of a state licensed profession.” MCL 600.2912; MSA 27A.2912.
"A claim based on the malpractice of a person who is, or holds himself out to be, a member of a state licensed profession accrues at the time that person discontinues treating or otherwise serving the plaintiff in a professional or pseudo-professional capacity as to the matters out of which the claim for malpractice arose.” MCL 600.5838; MSA 27A.5838.
"1 We observe that after Sam, the Court has continued to acknowledge that malpractice actions may be maintained against hospitals. Wilson v Stilwill, 411 Mich 587; 309 NW2d 898 (1981).” 116 Mich App 561-563.
See also Head v Children’s Hospital of Michigan, 407 Mich 388; 285 NW2d 203 (1971).
The plaintiff has not pursued in this Court his claim that his complaint alleged ordinary negligence, rather than medical malpractice. Some hospital errors in patient treatment may, of course, be ordinary negligence rather than malpractice. Illustrating this point, the Court of Appeals below wrote, "[w]e observe that the facts pleaded in this case are distinguishable from those in Fogel v Sinai Hospital of Detroit, 2 Mich App 99; 138 NW2d 503 (1965), and Gold v Sinai Hospital of Detroit, Inc, 5 Mich App 368; 146 NW2d 723 (1966), in which patients’ suits against hospitals for falls were held to sound in ordinary negligence and not malpractice.” 116 Mich App 564. | [
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Cooley, J.
On March 12, 1866, Aaron J. Lashbrooks and Catherine, his wife, gave a real estate mortgage to John K. Hatheway to secure the sum of two thousand dollars represented by a note bearing ten per centum interest, and payable in installments, the last of which fell due March 1,. 1872. In drawing the mortgage a very unusual printed form appears to have been made use of, one clause of which purported to bind the mortgagors to pay “ all such further or other sum and sums of money and other indebtedness n that might be due or owing from the mortgagors or either of them when the mortgage should become due and payable or whenever foreclosed, and to authorize the mortgagee in case of foreclosure to retain the amount of such other indebtedness from the moneys realized. The residence of John K. Hatheway was in Massachusetts, and the mortgage was in the hands of Gilbert Hatheway at New Baltimore, Michigan, from the time it was made for several years. Gilbert Hatheway seems to have had charge of other interests of John U. Hatheway during this time, and Aaron J. Lash-brooks had dealings with him in his capacity of agent, in the course of which other securities were given and payments were made. It does not appear that there were any dealings' in respect to the real estate mortgage after 1871, or that the mortgagors were ever called Upon to make payment of either interest or principal.
In March, 1881, James S. P. Hatheway, claiming to be assignee of the mortgage, without first calling for payment, published in the county of St. Clair where the lands were situated a notice of foreclosure under the power of sale, the day of sale being fixed for June 16, 1881. When this publication first came to the knowledge of Aaron J. Lashbrooks he filed a bill to enjoin the sale and to redeem from the mortgage. Hatheway claimed in his notice that $10,757.16 was due on the mortgage, but Lashbrooks denied any such indebtedness, asked for an accounting, and offered to pay any sum that should be found owing. He also averred that the clause in the mortgage which purported to extend it to other indebtedness than the mortgage note was not in the mortgage with his assent, and was a fraud upon him.
Hatheway answered the bill, and also filed a cross-bill against Lashbrooks and his wife, the purpose of which was to foreclose the mortgage. He alleged, in general terms, that he was assignee of the mortgage, but did not show how he became such. Besides the mortgage note he claimed to foreclose for the amount of several obligations, the most of which were given to either J ohn K. Hatheway or Gilbert Hatheway. An answer was filed to the cross-bill, and issue having been formed, voluminous evidence was taken which was directed mainly to the question whether anything remained unpaid by Aaron J. Lashbrooks on the dealings between himself and John K. Hatheway. The court of chancery adjudged $5500 to be due and owing on the mortgage, being the $2000 and interest, and decreed a sale of the mortgaged premises to satisfy that amount, with the costs. All parties appealed.
Objection is made on behalf of the Lashbrooks that Hatheway fails to show title to the mortgage, and we are constrained to say that the objection is well taken. In his bill, as has been said, he avers in general terms that he is assignee, and he attempts to prove the allegation by producing a deed from John K. Hatheway and wife, which bears date February 26, 1872, and purports to “ bargain, sell, remise, release and forever quitclaim unto the said party of the second part and to his heirs and assigns forever, all of our and each of our rights, titles and interests in and tó any and all real estate and personal estate and property of whatever name or nature, situate in the counties of Macomb and St. Clair in the State of Michigan or else where in the United States, which has in any way arisen ■or grown ont of the stave business (so-called transactions) as ■conducted by Gilbert Hatheway as attorney in fact for John II. Hatheway, including all .notes, mortgages, accounts, dues, demands, choses in action and all evidences of indebtedness whatever that may arise or grow out of any or .all bargains, agreements, transactions and dealings of Gilbert Hatheway, as attorney in fact for John K. Hatheway in conducting all the aforesaid referred to so-called stave business in all and every part of the United States of America.” This, with possession of the mortgage note which was not negotiable, constituted the sole evidence of title in complainant. But this could not have the effect to pass the title to these securities unless it should be made to •appear that in some manner they had their origin in or were in some manner connected with the stave business; and on that point we have from Hatheway neither allegation nor proof. A casual statement by Aaron J. Lashbroohs was pointed out on the argument as tending to make such •proofs, but it was a vague and indefinite statement, and neither went far enough nor was sufficiently specific to ■establish the fact. It was conceded that the mortgage was given to secure the payment of the purchase price of land ■described in it, and its connection with the stave business, if any- existed, must have been somewhat remote and circuitous. Hatheway, therefore, failed to establish a necessary fact on which his right to enforce the mortgage depended, and his bill must for that reason be dismissed.
Under ordinary circumstances we should go no further in the case; but as there has been a vigorous contest on the merits, and there is reason to believe that no one representing John K. Hatheway, who is now deceased, disputes the right of James S. P. Hatheway to the mortgage, and it Is probable that the expression of an opinion may prevent further litigation, it seems proper to say that we have not been impressed by the evidence that any sum remains unpaid which is secured by the mortgage. .
In taking the proofs, and on the argument, it has been assumed on the part of Hatheway that the burden was upon the Lashbrooks to show payment of the mortgage debt ;. and the general rule is undoubtedly in accord with this-assumption. The mortgagors have taken upon themselves this burden, and endeavored to make this proof, and counsel for Hatheway insist that their showing is vague, inconclusive, unsatisfactory and in some particulars inconsistent with itself and with some of the allegations in the original bill. There is foundation for the criticisms made, and they have not been overlooked by us in coming to our conclusions. But, on the other hand, we cannot overlook some-circumstances which not only bear strongly against the claim set up under the mortgage, but tend to excuse the-defects in the showing made against it, or at least to entitle it to be viewed with more than ordinary liberality. After ten years’ delay, during which it does not appear that any claim, was being made under the mortgage, or, on the other hand, that the mortgagors were recognizing it as an existing security, we find it suddenly, without warning, put in process of foreclosure, and a sum claimed under it which is not only more than five times the amount of the original debt, but is-large enough, apparently, to require the sale of all the land to satisfy it. In the mean time John K. Hatheway and Gilbert Hatheway have both deceased, and any light which either of them might throw upon their dealings with the Lashbrooks has become impossible of attainment. Among the papers of Gilbert Hatheway were the various securities he had taken from Aaron J. Lashbrooks besides the mortgage in the suit, and there 'was a memorandum in his handwriting indicating that some of these were to be delivered up to Lashbrooks, but it was impossible to determine clearly what ones were intended. It is very plain that the Lash-brooks had confided in Gilbert Hatheway, and placed themselves to a considerable extent in his hands; and it would be both unjust and illogical to require of them, under the circumstances, the same full and complete showing of their equities that would be expected if the transactions were recent, and if the parties had apparently dealt with each other on a footing of equality and without special trust. If there were no mortgage all remedy on these demands would have been lost by lapse of time, and the mortgage does not keep alive the personal obligation, which was barred some years ago. Mich. Ins. Co. v. Brown 11 Mich. 265; Appeal of Goodrich 18 Mich. 110; Powell v. Smith 30 Mich. 452. It is, of course, possible for an entirely just claim to be suffered to lie along in this manner without the notice of either creditor or debtor, but it is so unusual that the circumstance is not to be overlooked in a case standing upon uncertain or conflicting evidence.
The evidence in this case is both uncertain and conflicting, but there is testimony from impartial witnesses which, if believed, makes out a prima facie ease of complete payment of the mortgage note. We are of opinion that it has not been overthrown by any evidence given on behalf of Hatheway, and that it must be accepted as conclusive.
The next question is whether the mortgage can be held to cover any other demand. We have seen that by its terms it purported to secure any claims the mortgagee might have against the mortgagors either before or at the time of foreclosure ; and it seems to be thought that the mortgagee might buy up demands at discretion and thereby extend the mortgage indefinitely. But this would be so extraordinary an arrangement that the intent to provide for it ought to be too clear for doubt before a court could be justified in enforcing it. We do not think it is to be found in this mortgage. The farthest this stipulation can be understood to go is to cover demands directly arising out of the dealings between the mortgagors and the mortgagee, and its terms will be fully answered if they are limited to such demands.
But, as has been said, this mortgage was written upon a, blank fo^m, and this very unusual clause was contained in. the printed part, and might very naturally have been overlooked in filling out or in signing it. There is some reason to believe that such was the case here. The mortgage was given while the federal laws requiring securities to be stamped in proportion to their amount were in force, and it was stamped for two thousand dollars only. This raises a strong presumption that it was not understood to be operative further as a security; and it is manifest that it could not have been, while the stamp laws remained in force, without further stamping. But it is not necessary to consider this clause further than to determine that it does not extend beyond the dealings between the mortgagee and the mortgagors. Upon those dealings we are not satisfied by the evidence that anything now remains unpaid.
The conclusion is that the cross-bill must bé dismissed with costs of both courts. As James S. P. Hatheway insists upon his ownership of the mortgage in suit, complainant in the original suit may have as against him a perpetual injunction to restrain foreclosure, and will recover costs.
The other Justices concurred.
After the foregoing opinion was filed attention was called by counsel to the fact that in the deed from John 3L Hatheway and wife to James S. P. Hatheway a clause subsequent to the one recited in the opinion purports to “ convey and deed unto the said James S. P. Hatheway all other real and personal estate and property of whatever name or naturae that they or either of them have any right, title or interest in and to, situate in the aforesaid Macomb and St. Clair counties, or elsewhere in the State of Michigan.” At the time of giving this deed the grantors resided in Massachusetts. Whether a debt due to one of them is to be deemed “ situate ” in the State of Michigan because secured upon property there, is a question upon which an opinion seems not to be called for, in view of what is above said on the merits. O. | [
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Sherwood, J.
The defendant was arrested and tried in justice’s court on a complaint ,and warrant charging him with keeping his saloon open on the 4th day of July, 1882, in Kalamazoo, contrary 'to How. Stat. § 2274. He was convicted on a tidal had before a jury, and on certiorari to the circuit court the judgment was affirmed by Judge Mills, and the case is now brought here for review, the respondent relying upon the same errors for reversal as at the circuit.
It is alleged for error that the complaint and warrant charge no offense. No particular defect is pointed out. We think they both sufficiently comply with the statute, and that-the judgment -was not without jurisdiction, as claimed by counsel for defendant.
In obtaining the jury in the case, three talesmen wore summoned. Of these, two were over sixty years of age, and upon that ground defendant challenged the array. The challenge was overruled, and this ruling is alleged as error. The ground taken was good challenge for cause but not to the array. It is also insisted that there was no evidence to go to the jury that the defendant “ kept open any place where liquor was sold on the 4th day of July, 1882.” Mr. Gates, the marshal of the village, was sworn and testified on his direct examination that the defendant kept a saloon on that day on Main street, and that he kept whisky, beer and liquors of different kinds; on his cross-examination he said he knew defendant was keeping the saloon on the 4th of July, 1882; that he saw Baumann around there that day, in the front part of the saloon where cigars and tobacco were kept, but not in the part where liquors were sold. On the re-direct examination he said that the doors of the saloon were open and he saw a good many men going in and out of the saloon that day;. that the front doors of the saloon were open.
Theodore Merrill testified in substance that he knew defendant and his business July 4, 1882. He kept a saloon on Main street. Baumann told Mr. Knappen that he was proprietor of the saloon. "Witness was in the saloon on that day two or three times. Saw a large number of persons in the saloon standing around the bar drinking liquor which in his judgment was beer and whiskey. That defendant’s bartender was behind the bar selling it. W. W. Peck testified he was internal revenue collector and had his office in same building; knew respondent’s saloon and that he kept it open on July 4, 1882, and saw men going in and out of it frequently on that day.
All this evidence was given and no evidence was offered to contradict it. This testimony shows no ground for the objection that there was no evidence showing defendant kept his saloon open on the 4th day of July as charged in the complaint.
Witness Merrill, for the purpose of showing that the respondent was proprietor of the saloon, was asked if he saw a license card in the saloon on that day and what it contained. This was objected to as irrelevant and immaterial. We think the objection properly overruled. For the purpose stated the testimony was proper.
Several other objections were taken and urged, but we think none of them tenable, and that they need no further consideration.
The judgment must be affirmed with costs.
.The other Justices concurred.
State of Michigan, County of Kalamazoo—ss: The complaint and examination, on oath and in writing, of Uhauncey Gates, taken and made before me, Isaac N. Wattles, a justice of the peace in said county, upon the 14th day of July, A. D. 1882, who, being duly sworn, says that he has just cause to believe, and does believe, heretofore, to-wit, on the 4th clay of July, A. D. 1882, at the village of Kalamazoo and in the county aforesaid, one Frank Baumann, being then and there a keeper of a saloon in said village, and the same being a place where spirituous and malt liquors are sold at retail, and the said 4lh of July, A. D. 1882, being a legal holiday, did not keep the said saloon closed, and did then and there on the said 4th day of July, A. D. 1882, a legal holiday, keep the said saloon open for the purpose of selling spirituous and malt liquors at retail therein, and the said Frank Baumann not being then and there a druggist, nor a person whose business consists in whole or in part of the sale of drugs and medicines, contrary to the form of the statute in such case made and-provided, and against the peace and dignity of the people of the State of Michigan; wherefore the said Uhauncey Gates prays that the said Frank Baumann may be apprehended and held to answer this complaint, and further dealt with in relation to the same as law and justice may require. ’• Chatjnoey Gates.
Taken, subscribed and sworn to before me the day and year first above written. Isaac N. Wattles,
Justice of the Peace.
State of Michigan, County of Kalamazoo — ss:
To the Sheriff or Constable of any County, Greeting: Whereas, Chauncey Gates hath this day made a complaint in writing and on oath to me, Isaac N. Wattles, a justice of the peace in and for said county, that he has just cause to believe, and does believe, heretofore, to-wit, on the 4th day of July, A. D. 1883, at the village of Kalamazoo, in the county aforesaid, one Frank Baumann, being then and there a keeper of a saloon in said village, and the same being a place where spirituous and malt liquors are sold at retail, and the said 4th of July, A. D. 1883, being a legal holiday, did not keep the said saloon closed, and did then ana there on the said 4th of July, A. D. 1883, a legal holiday, keep the said saloon open for the purpose of selling spirituous and malt liquors at retail therein, and the said Frank Baumann not being then and there a druggist nor a person whose business consists in whole or in part of the sale of drugs and medicines, contrary to the form of the slatute in such case made and provided, and against the peace and dignity of the people of the State of Michigan. And, whereas, on examination, on oath of the said Ohauncey Gates and two other persons by me, the said justice of the peace, it appears to me, the said justice of the peace, that said offense has been committed, and there is just cause to suspect the said Frank Baumann to have been guilty thereof ; ■therefore, in the name of the people of the State of Michigan, you, and each of you, are hereby commanded forthwith to arrest the said Frank Baumann and bring him before me, the said justice of the peace, to be dealt with according to law.
Given under my hand and seal, at the village and township of Kalamazoo, in said county, on the 14th day of July, A. D. 1883.
Isaac N. Wattles [l. s.]
Justice of the Peace. | [
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] |
Per Curiam.
These nine cases require us to reexamine the extent of immunity from tort liability which the governmental tort liability act, MCL 691.1401 et seq.; MSA 3.996(101) et seq., and the common law provide to the state and its agencies, non-sovereign governmental agencies, and the officers, agents, and employees of these state and local governmental agencies. We hold:
1) All governmental agencies (state and local) are statutorily liable for injuries arising out of the failure to keep highways in reasonable repair (MCL 691.1402; MSA 3.996[102]), negligent operation of a government-owned motor vehicle by an officer, agent, or employee (MCL 691.1405; MSA 3.996[105]), and dangerous or defective conditions in public buildings under the agency’s control (MCL 691.1406; MSA 3.996[106]).
2) All governmental agencies (state and local) have tort liability for injuries arising out of the performance of a proprietary function. "Proprietary function” is defined as any activity conducted primarily for pecuniary profit, excluding activities normally supported by taxes or fees (see MCL 691.1413; MSA 3.996[113]).
3) All governmental agencies (state and local) are immune from tort liability for injuries arising out of the exercise or discharge of a non-proprietary, governmental function. "Governmental function” is defined as any activity which is expressly or impliedly mandated or authorized by constitution, statute, or other law. An agency’s ultra vires activities are therefore not entitled to immunity.
4) All governmental agencies (state and local) are vicariously liable for the negligent operation of government-owned motor vehicles by their officers, employees, and agents (MCL 691.1405; MSA 3.996[105]). Vicarious liability for all other torts may be imposed on a governmental agency only when its officer, employee, or agent, acting during the course of his employment and within the scope of his authority, commits a tort while engaged in an activity which is non-governmental or proprietary, or which falls within a statutory exception.
5) Judges, legislators, and the highest executive officials of all levels of government are absolutely immune from all tort liability whenever they are acting within their respective judicial, legislative, and executive authority. Lower level officers, employees, and agents are immune from tort liability only when they are
a) acting during the course of their employment and are acting, or reasonably believe they are acting, within the scope of their authority;
b) acting in good faith; and
c) performing discretionary-decisional, as opposed to ministerial-operational, acts.
"Discretionary-decisional” acts are those which involve significant decision-making that entails personal deliberation, decision, and judgment. "Ministerial-operational” acts involve the execution or implementation of a decision and entail only minor decision-making.
6) If the officer, agent, or employee is acting within the course of his employment and the scope of his authority, the governmental agency may pay for, engage, or furnish an attorney; represent the officer, agent, or .employee in the action; and compromise, settle, pay, or indemnify claims or judgments against the officer, agent, or employee. Such action, however, does not impose tort liability upon the governmental agency (MCL 691.1408; MSA 3.996[108]).
I. The Governmental Tort Liability Act
The causes of action in each of these cases arose after the governmental immunity statute was enacted. The title of the act, as amended, states that it is
"AN ACT to make uniform the liability of municipal corporations, political subdivisions, and the state, its agencies and departments, when engaged in the exercise or discharge of a governmental function, for injuries to property and persons; to define and limit this liability; to define and limit the liability of the state when engaged in a proprietary function; to authorize the purchase of liability insurance to protect against loss arising out of this liability; to provide for defending certain claims made against public officers and paying damages sought or awarded against them; to provide for the legal defense of public officers and employees; to provide for reimbursement of public officers and employees for certain legal expenses; and to repeal certain acts and parts of acts.”
The governmental immunity act sets forth four categories of activity for which tort liability may be imposed. All governmental agencies, both state and local are statutorily liable for bodily injury and property damage arising out of the failure to keep their highways in reasonable repair, the negligent operation of a government-owned motor vehicle by the agency’s officer, agent, or employee, and dangerous or defective conditions in public buildings under the agency’s control. In addition, the state and its agencies, departments, and commissions are liable when engaged in a proprietary function.
The heart of the act is § 7, which provides broad immunity from tort liability to governmental agencies whenever they are engaged in the exercise or discharge of a governmental function:
"Except as in this act otherwise provided, all governmental agencies shall be immune from tort liability in all cases wherein the government agency is engaged in the exercise or discharge of a governmental function. Except as otherwise provided herein, this act shall not be construed as modifying or restricting the immunity of the state from tort liability as it existed heretofore, which immunity is affirmed.” MCL 691.1407; MSA 3.996(107).
Two problems are readily apparent in interpreting this provision. First, the second sentence statutorily affirms the law of sovereign (state) immunity from tort liability as it existed at the time the statute was enacted. Thus, this Court must examine the history of sovereign immunity to determine the exact parameters of the state’s immunity. Second, "governmental function” is not defined in the act. This Court has struggled for more than a century to reach a consensus on this term’s definition and application in a myriad of factual situations.
Finally, the act allows a governmental agency to provide legal assistance to and reimbursement of settlements and judgments levied against its officers, agents, and employees under certain circumstances. However, the act does not define under what circumstances such officers, agents, and employees may be held liable for their tortious acts. Nor does it specifically address the question of whether a governmental agency may be held vicariously liable for such torts under a theory of respondeat superior. We must again resort to an analysis of common law to determine the parameters of official liability.
In resolving the questions presented by this act, our goal has been to create a cohesive, uniform, and workable set of rules which will readily define the injured party’s rights and the governmental agency’s liability. We recognize that our case law on these questions is confused, often irreconcilable, and of little guidance to the bench and bar. We have made great efforts to reexamine our prior collective and individual views on this subject in order to formulate an approach which is faithful to the statutory language and legislative intent. Wherever possible and necessary, we have reaffirmed our prior decisions. The consensus which our efforts produce today should not be viewed as this Court’s individual or collective determinations of what would be most fair or just or the best public policy. The consensus does reflect, however, what we believe the Legislature intended the law to be in this area.
II. Sovereign (State) Immunity
Although the concepts of "sovereign immunity” and "governmental immunity” are related, they have distinct origins and histories:
" '[Sovereign’ immunity and 'governmental’ immunity are not synonymous. True, they have been over the years used interchangeably in decisions, but a delin eation may be helpful. Sovereign immunity is a specific term limited in its application to the State and to the departments, commissions; boards, institutions, and instrumentalities of the State. The reason is the State is the only sovereignty in our system of government, except as the States delegated part of their implicit sovereignty to the Federal government.
"Over the years, by judicial construction, this 'sovereign’ immunity has been transmogrified into 'governmental’ immunity and made applicable to the 'inferior’ divisions of government, i.e., townships, school districts, villages, cities, and counties, but with an important distinction. These subdivisions of government enjoyed the immunity only when engaged in 'governmental’ as distinguished from 'proprietary’ functions.” Myers v Genesee County Auditor, 375 Mich 1, 6, 8-9; 133 NW2d 190 (1965) (opinion by O’Hara, J.) (emphasis in the original).
Sovereign immunity is an ancient common-law concept that predates the statehood of Michigan by centuries. The sovereign immunity rule stated that the "sovereign” was immune from suit unless he consented to the action. Over the years, lawyers and judges have articulated two bases for this rule. The first rationale developed from the perception that the sovereign (the king) was somehow "divine” or above the law. As such, the king could commit no wrong and was, therefore, never properly sued. The second explanation was that the king was superior to the courts which he had created and vested with a portion of his power. As such, while the sovereign could do wrong, there was no entity with power to enter judgment against the sovereign. Only by the sovereign’s consent (essentially, a self-inflicted judgment) could a party recover for an injury caused by the sovereign. This rule, with its dual rationale, was the common-law rule for all sovereigns in the early nineteenth century.
From statehood forward, Michigan jurisprudence recognized that the sovereign (the state) was immune from all suits, including suits for tortious injuries which it had caused. The rationale for sovereign immunity was never grounded in a belief that the state could do no wrong. Rather, sovereign immunity existed in Michigan because the state, as creator of the courts, was not subject to them or their jurisdiction. As the Supreme Court stated in Michigan State Bank v Hastings, 1 Doug 225, 236 (Mich, 1844):
"The principle is well settled that, while a state may sue, it cannot be sued in its own courts, unless, indeed, it consents to submit itself to their jurisdiction. * * * [A]n act of the legislature, conferring jurisdiction upon the courts in the particular case, is the usual mode by which the state consents to submit its rights to the judgment of the judiciary.”
Thus, the original Michigan rule held that the state was immune from all suits except to the extent that it consented to be sued in its courts.
Sovereign immunity was not, however, an absolute bar to recovery against the state. As noted in Hastings, the Legislature could and did consent to suits. In 1842, the difficulties caused by legislative disposition of every claim against the state led to the creation of the Board of State Auditors. The Legislature authorized the board to hear and decide claims against the state. In effect, the Board of State Auditors exercised the "sovereign” legislative power to consent to suit or to assert sovereign immunity. However, when the board chose not to consent to "suit,” the issue was not appealable to the state courts. As the Supreme Court stated in People ex rel Ayres v Board of State Auditors, 42 Mich 422, 427-428; 4 NW 274 (1880):
"[N]o claim against the State could, under the old Constitution, be allowed except by the Legislature. The State has never, before or since, allowed itself to be sued in its own courts * * *.
"* * * In providing for a different method of determining claims against the State, it was not deemed proper to include it within the judicial power * * *.”
In the 1920’s, most of this general claims function was transferred to the State Administrative Board. Among other matters, the board was statutorily authorized to inquire into, settle, and pay claims for injuries incurred by state employees during the course of their employment, and to entertain and pay claims for damages arising out of the negligent construction, improvement, or maintenance of state trunk line highways. In. addition, it had the discretionary power to hear and determine claims against the state arising from the "negligence, malfeasance or misfeasance of any state officer, employe, commission, department, board, institution, or other governmental division * * *.”
In 1939, the Legislature created the Court of Claims. 1939 PA 135, § 2. The Court of Claims was given exclusive jurisdiction "[t]o hear and determine all claims and demands, liquidated and unliquidated, ex contractu and ex delicto, against the state and any of its departments, commissions, boards, institutions, arms or agencies.” §8(1). By creating a court with jurisdiction over the state, the Legislature destroyed the theoretical basis for sovereign immunity. There was now an entity with power to hear cases against the state, and individual consent to suit was no longer required. However, the Legislature retained sovereign immunity from tort liability in § 24:
"This act shall in no manner be construed as enlarging the present liabilities of the state and any of its departments, commissions, boards, institutions, arms or agencies.”
The distinction between immunity from suit and immunity from liability was made clear in Manion v State Highway Comm’r, 303 Mich 1, 19-21; 5 NW2d 527 (1942). There, plaintiff sued for injuries received while employed by the State Highway Commission. The state successfully moved to dismiss the suit on the grounds that the injuries were sustained during the maintenance of a highway, which was a governmental function. In determining exactly what immunity the Legislature had waived by enacting 1939 PA 135, the majority wrote:
"The State, as sovereign, is immune from suit save as it consents to be sued, and any relinquishment of sovereign immunity must be strictly interpreted * * *.
"There is a distinction between sovereign immunity from suit and sovereign immunity from liability. The latter exists when the sovereign is engaged in a governmental function. The former may be waived without a waiver of the latter. Section 24 of the court of claims act * * * reads:
" 'This act shall in no manner be construed as enlarging the present liabilities of the State and any of its departments, commissions, boards, institutions, arms or agencies.’
"I construe this to mean that the State’s immunity from liability while engaged in a governmental function is preserved because the waiver of this defense would enlarge the 'present liabilities of the State.’
"The State is not liable in this instance because of its sovereign immunity from liability in the performance of a governmental function and not because of its sovereign immunity from suit.” (Emphasis added.)
Subsequent decisions emphasized that the common-law doctrine of sovereign immunity from tort liability could not be waived or abrogated except by statute. Mead v Michigan Public Service Comm, 303 Mich 168, 173; 5 NW2d 740 (1942); McNair v State Highway Dep’t, 305 Mich 181, 187; 9 NW2d 52 (1943). In addition, sovereign immunity from tort liability was recognized as a defense only when the state was engaged in the exercise or discharge of a governmental function. See, eg., Daszkiewicz v Detroit Bd of Ed, 301 Mich 212, 220; 3 NW2d 71 (1942); Mead, supra, p 171; Thomas v Dep’t of State Highways, 398 Mich 1, 11, fn 5; 247 NW2d 530 (1976); Bofysil v Dep’t of State Highways, 44 Mich App 118, 126; 205 NW2d 222 (1972), lv den 389 Mich 768 (1973).
In 1943, the Legislature abolished a significant portion of the state’s sovereign immunity from tort liability by amending § 24 of 1939 PA 135. The state was now liable for injuries caused by the misfeasance or negligence of its officers and employees while acting within the scope of their employment. 1943 PA 237, § 24. However, 1943 PA 237 was repealed soon thereafter by 1945 PA 87, § 2, thus resurrecting the state’s previous common-law sovereign immunity from tort liability. 1945 PA 87, § 1, however, created a limited statutory exception to this common-law immunity — the state was liable for damages arising out of the negligent operation of a state-owned motor vehicle by a state employee. The fact that the state was engaged in a governmental function at the time of the injury was not a defense. Thus, the Legislature impliedly acknowledged that the state enjoyed immunity only when it was engaged in the exercise or discharge of a governmental function.
The viability of the doctrine of sovereign immunity was not seriously assailed until Williams v Detroit, 364 Mich 231; 111 NW2d 1 (1961). There, plaintiffs decedent fell down an elevator shaft in a city building while moving furniture out of city offices. The majority held that the city was immune from liability because the injury was incurred while the city was performing a governmental function. In the future, however, this would not be so. Justice Edwards, joined by Justices Smith, T. M. Kavanagh, and Souris, wrote:
"From this date forward the judicial doctrine of governmental immunity from ordinary torts no longer exists in Michigan. In this case, we overrule preceding court-made law to the contrary.” Williams, supra, p 250.
However, Justice Black’s concurring opinion held that immunity from liability would only be abolished for municipalities, not for the state and its subdivisions:
"We are not considering today — as the opinions of both Brothers suggest — 'the doctrine of governmental immunity.’ That doctrine includes within its purview the State and 'its departments, commissions, boards, institutions, arms or agencies.’ * * * We are considering the common-law rule that municipal corporations are immune from tort liability. 'Municipal corporations’ are distinctively definable * * * and care should be taken that today’s decision is confined thereto.” Id., p 278 (emphasis in original).
Thus, by a 4-4 vote, sovereign immunity was reaffirmed. Justice Black’s position was thereafter adopted in McDowell v State Highway Comm’r, 365 Mich 268, 270-271; 112 NW2d 491 (1961).
In reaction to this Court’s abolition of common-law governmental immunity for municipalities in Williams, and in anticipation of a similar demise of immunity for counties, townships, and villages, the Legislature enacted the governmental immunity act in 1964. The first sentence of § 7 was intended to not only restore governmental immunity to non-sovereign governmental agencies, but to provide uniform treatment for state and local agencies. Furthermore, the affirmance of corn mon-law sovereign immunity in the second sentence of § 7 was a clear directive that this Court henceforth could not further extend Williams and judicially abrogate the state’s sovereign immunity. See Thomas, supra, 398 Mich 10.
Therefore, at the time § 7 was enacted, the state was immune from tort liability when it was engaged in the exercise or discharge of a governmental function, unless a statutory exception was applicable. This same immunity is reiterated by the first and second sentences of § 7.
Subsequent decisions of this Court did not change the parameters of statutory sovereign immunity. In Maki v East Tawas, 385 Mich 151; 188 NW2d 593 (1971), this Court affirmed the Court of Appeals determination that § 7 was unconstitutional because it violated the title-object clause of Const 1963, art 4, § 24. During the pendency of the case before this Court, however, the Legislature amended the title of the governmental immunity act to remedy the constitutional problem. It did not modify § 7 in any significant respect. Such action indicates that the Legislature did not intend to change the scope of statutory sovereign or governmental immunity from that intended in* the original 1964 version of § 7._
The net effect of Maki was that statutory sovereign and governmental immunity did not exist until August 1, 1970, the effective date of the Legislature’s amendment ,of the act’s title. Causes of action arising before this date were governed by this Court’s common-law decisions. Pittman v City of Taylor, 398 Mich 41, 46; 247 NW2d 512 (1976) (opinion of Kavanagh, C.J.).
Pittman subsequently abolished common-law sovereign immunity as to that case and those cases pending as of November 23, 1976 (the date Pittman was decided) which had raised an express challenge to common-law "governmental” (i.e., sovereign) immunity. Id., p 50. ********************23 However, the lead opinion specifically noted that its holding abol ished only common-law immunity; the statutory immunity conferred by the governmental immunity act had to be given effect, unless it was unconstitutional to do so. Id., p 49, fn 8. Since Pittman was decided long after the Legislature enacted and amended the act, it is not relevant to determining the legislative intent behind the second sentence of § 7.
In summary, at the time § 7 was enacted and became effective, the state enjoyed immunity from tort liability at common law whenever it was engaged in the exercise or discharge of a governmental function, unless a statutory exception was applicable. This common-law sovereign immunity was codified by the second sentence of § 7. The immunity granted to the state by the first sentence of §7 is essentially coextensive with this common-law immunity. We note that this interpretation furthers the Legislature’s intent to create uniform standards of liability for state and non-sovereign governmental agencies.
III. Definition of "Governmental Function”
Sovereign and governmental immunity from tort liability exist only when governmental agencies are "engaged in the exercise or discharge of a governmental function.” § 7. Although "governmental function” is not defined in the act, it "is a term of art which has been used by the courts of this state to describe those activities of government which due to their public nature should not give rise to liability at common law.” Thomas v Dep’t of State Highways, 398 Mich 1, 9; 247 NW2d 530 (1976). There is a substantial body of case law defining this term. The initial question which must be resolved is whether the phrase "governmental function” is to be interpreted in light of present-day governmental activities, or whether the Legis lature intended § 7 to have, as its fixed meaning, the common-law definition which existed at the time § 7 became effective.
In Thomas, supra, pp 9-11, a majority of the Court concluded that we were bound by the common-law definition. However, this holding was overruled in Parker v Highland Park, 404 Mich 183; 273 NW2d 413 (1978). In holding that the operation of a general hospital by a city is not a governmental function, Justice Fitzgerald, joined by Chief Justice Kavanagh and Justice Levin, wrote:
"[W]e [do not] believe that the Legislature intended that we must today hold the operation of a hospital to be a governmental function because we did so in 1902 and 1950. As was stated in the Kavanagh-Fitzgerald dissenting opinion in Thomas v Dep’t of State Highways, 398 Mich 1, 17, fn 4; 247 NW2d 530 (1976), to read the second sentence of MCL 691.1407; MSA 3.996(107) as 'preserving for all time state governmental immunity heretofore recognized by case-law’ would be to 'assume that the Legislature failed to recognize that the evolution of case law precedent is exclusively committed to the judicial branch of government.’
"Determining whether or not a certain activity is or is not a 'governmental function’ is a matter of statutory interpretation. In the absence of a legislative definition of the term, statutory interpretation is a function committed to the judiciary. The term 'governmental function’ is particularly subject to judicial interpretation because the phrase is of judicial origin.” Id., p 192._
Justice Moody reached a similar conclusion in his concurring opinion. Id., pp 197-199.
We decline this opportunity to overrule this aspect of Parker. We note that the Legislature was certainly aware of our conflicting "morass” of case law concerning the definition of "governmental function” when it enacted § 7. The Legislature could have statutorily defined the term, as it did with "proprietary function” in § 13, but it has not done so. Furthermore, judicial development and refinement of the concept of governmental function allows us to keep abreast of the changing activities and needs of government and its people.
A. Prior Deñnitions of "Governmental Function”
Prior to 1976, the decisions of this Court generally fell into two categories. A governmental agency could not assert the defense of sovereign or governmental immunity from tort liability if it was engaged in a "proprietary” function or did not act for the "common good of all.” In 1976, the "essence to governing” test was articulated by the Thomas dissent. Under this test, a function is not governmental unless the particular activity involved is essential to governing in that it has no common analogy to the private sector. Thomas, supra, p 21 (Kavanagh, C.J., and Fitzgerald, J., dissenting). A similar "of essence to governing” test was created by the late Justice Blair Moody, Jr. Rather than requiring that the activity have no common analogy, Justice Moody believed that the governmental agency must show that "the purpose, planning and carrying out of the activity, due to its unique character or governmental mandate, can be effectively accomplished only by the government.” Parker, supra, p 200.
Unfortunately, each of these tests has proved difficult to apply.
"Proprietary Function” Test. Since government is instituted for the equal benefit, security, and protection of its people, a governmental agency cannot claim that it is engaged in a governmental function when the activity makes a profit for itself or for private individuals. Decisions of this Court have differed, however, as to how much, if any, incidental profit can be generated before an activity is deemed to be proprietary. By enacting § 13 of the governmental immunity act, the Legislature adopted the common-law "proprietary function” test but made it clear that activities which generate an incidental profit may still be considered governmental functions:
"The immunity of the state shall not apply to actions to recover for bodily injury or property damage arising out of the performance of a proprietary function as herein defined. Proprietary function shall mean any activity which is conducted primarily for the purpose of producing a pecuniary profit for the state, excluding, however, any activity normally supported by taxes or fees.”
However, the enactment of § 13 presents two problems. First, it can be argued that if proprietary functions have always been considered nongovernmental in nature, there would have been no need to enact the first sentence of § 13. Stated another way, the statutory waiver of immunity from tort liability for proprietary functions would have been totally unnecessary because such functions have never enjoyed immunity.
We do not believe that § 13 is mere surplusage. As with the second sentence of § 7, the Legislature wished to codify the "proprietary function” test and to define clearly the parameters thereof to prevent this Court from further modifying the common-law test. Nevertheless, in order to avoid rendering the first sentence surplusage, we will no longer define "governmental function” with reference to "proprietary function.” The question whether a particular activity is governmental or proprietary in nature involves two separate inquiries. A governmental agency which performs a proprietary function is not immune from tort liability pursuant to § 13; however, the converse is not necessarily true. An activity may generate no profit (i.e., be nonproprietary), but may still be nongovernmental in nature, as hereinafter defined, and thus subject to tort liability pursuant to § 7.
The second problem is that § 13 applies only to the state and its agencies, departments and commissions. The failure to include non-sovereign governmental agencies could be interpreted as bestowing governmental immunity upon their proprietary activities. We decline to read § 13 in such a manner because we do not believe the Legislature intended such a result.
The governmental immunity act was intended to provide uniform liability and immunity to both state and local governmental agencies. A strict "expressio unius est exclusio alterius” reading of § 13 would destroy this uniformity. As noted in Pittman, supra, p 48, there is no satisfactory reason to treat state and non-sovereign governmental agencies differently. Moreover, the "proprietary function” exception to common-law governmental immunity was well established at the time § 13 was enacted. If the Legislature had wished to abolish this rule as to non-sovereign governmental agencies, it would have done so in more explicit language.
Therefore, we reaffirm the common-law "proprietary function” exception to governmental immunity from tort liability, and we conclude that the statutory definition of "proprietary function” is applicable to all governmental agencies, State and local. In short, although § 13 of the governmental immunity act applies only to state governmental agencies, the same terms and principles embodied therein will be judicially applied to non-sovereign governmental agencies.
"Common Good of All” Test. This test was aptly summarized by Justice Ryan in Ross, supra, p 7:
"The expression "common good of all” has been used for more than a half century in cases discussing the doctrine of governmental immunity. Originally, it was intended to distinguish between governmental activity which has an exclusively public purpose as opposed to that which is 'of special corporate benefit or pecuniary profit.’ See Bolster v City of Lawrence, 225 Mass 387; 114 NE 722 (1917). The expression was first employed in our state’s jurisprudence in cases concerning the immunity or liability of municipal corporations to distinguish between 'governmental’ and 'proprietary’ municipal functions. Gunther v Cheboygan County Road Comm’rs, 225 Mich 619, 621; 196 NW 386 (1923). See also Martinson v Alpena, 328 Mich 595; 44 NW2d 148 (1950), and cases cited therein. More recently the expression has been used in governmental immunity cases interpreting MCL 691.1407; MSA 3.996(107) to describe the standard by which an activity of a governmental agency is judged to be a governmental function and therefore immune from tort liability at the common law.”
The proponents of the "essence to governing” test have criticized the "common good of all” test. They argue that governmental agencies often engage in activities which arguably contribute to the common good. Nevertheless, these same activities are often accomplished by non-governmental entities which do not enjoy immunity from tort liability. The mere fact that a governmental agency engages in such an activity does not convert the activity into a governmental function. Ross, supra, pp 29-30 (opinion of Kavanagh, J.); Parker, supra, pp 194-195 (opinion of Fitzgerald, J.).
Aside from these criticisms, we also note that. the "common good of all” test is rather amorphous and difficult to apply. Almost all government activity is in some sense directed toward the public good. Nevertheless, it is rare when a particular activity benefits every member of the state equally. For example, a state mental hospital, such as that involved in Perry, is theoretically open to every member of the state who requires psychiatric treatment. In practice, however, only a small percentage of the state population actually uses the. facility. Similarly, a municipal hospital, such as that involved in Parker, is generally open only to local residents even though it is a public facility. Finally, although the drain constructed in Ross was planned, designed, constructed, and maintained pursuant to the state Drain Code’s comprehensive system of water management control, it directly benefited only the Jackson County landowners whose land was drained. Because application of the "common good of all” test could result in either immunity or liability depending upon the viewpoint of the particular decision-maker, we decline to incorporate this test into the definition of "governmental function.”
"Essence to/of Governing” Tests. These tests represent attempts to describe and pinpoint those activities which are uniquely and generally associated with government. Relatively few activities can qualify for immunity under the "essence of governing” test since they must have no common analogy to the private sector. As the Thomas dissent noted, their test would generally grant immunity only to executive, legislative, or judicial decision-making and planning — the execution of these decisions would be susceptible to tort liability. Thomas, supra, pp 21-22. Moreover, governmental activities which appear unique at the time a particular case is decided may not be so in the future. Private enterprise has ventured into such "unique” activities as providing private security forces and establishing jail facilities. Some activities which a governmental agency is required by law to undertake and provide to the public, and which have consistently been afforded immunity from tort liability, have common private sector counterparts, e.g., public schools and state mental health facilities.
Justice Moody’s "essence of governing” test pro vides more flexibility because it focuses on whether the activity can be effectively accomplished only by government. Unfortunately, this approach is also flawed. For example, as noted in Ross, supra, pp 23-24 (opinion of Ryan, J.), many storm drains in the state are privately financed and built by individual landowners who require them. Private construction companies may be able to engineer, construct, and maintain drains more effectively than the local drainage district. Nevertheless, the fact remains that the drainage district is statutorily responsible for providing an efficient and systematic drainage system to safeguard the public health and welfare. Private enterprise may also decline to engage in or abandon an activity which benefits the public good (e.g., a hospital or health care facility) because it is not sufficiently profitable, not because it cannot effectively accomplish the activity. If a governmental agency thereafter assumes the responsibility in order to provide or continue to make available necessary public services, it risks tort liability.
Finally, both tests fail to specify precisely what activity must be evaluated. As noted in Ross, supra, pp 22-23 (opinion of Ryan, J.), if the actual physical construction of a drain, sewer, or other public project is the activity which must be evaluated, immunity will never be afforded to the governmental agency which undertakes the construction itself, since the private sector often undertakes similar projects. This would be true even where the project is mandated by statute.
B. New Deñnition of "Governmental Function”
The fundamental problem with the "common good of all” and "essence to/of governing” definitions of "governmental function” is that they require the judiciary to make value judgments as to which activities government should be allowed to engage in without being held responsible for the unfortunate consequences thereof. This type of subjective inquiry necessarily results in legitimate difference of opinion. In contrast, the immunity from tort liability provided by § 7 is expressed in the broadest possible language — it extends immunity to all governmental agencies for all tort liability whenever they are engaged in the exercise or discharge of a governmental function. This broad grant of immunity, when coupled with the four narrowly drawn statutory exceptions, suggests that the Legislature intended that the term "governmental function” be interpreted in a broad manner.
The Legislature’s refusal to abolish completely sovereign and governmental immunity, despite this Court’s recent attempts to do so, evidences a clear legislative judgment that public and private tortfeasors should be treated differently. This disparate treatment is not totally unjustifiable. The California Law Commission, after an extensive and careful study of the problems presented by sovereign and governmental immunity, concluded:
"The problems involved in drawing standards for governmental liability and governmental immunity are of immense difficulty. Government cannot merely be liable as private persons are for public entities are fundamentally different from private persons. Private persons do not make laws. Private persons do not issue and revoke licenses to engage in various professions and occupations. Private persons do not quarantine sick persons and do not commit mentally disturbed persons to involuntary confinement. Private persons do not prosecute and incarcerate violators of the law or administer prison systems. Only public entities are required to build and maintain thousands of miles of streets, sidewalks and highways. Unlike many private persons, a public entity often cannot reduce its risk of potential liability by refusing to engage in a particular activity, for government must continue to govern and is required to furnish services that cannot be adequately provided by any other agency. Moreover, in our system of government, decision-making has been allocated among three branches of government — legislative, executive and judicial — and in many cases decisions made by the legislative and executive branches should not be subject to review in tort suits for damages, for this would take the ultimate decision-making authority away from those who are responsible politically for making the decisions.” 4 California Law Revision Comm Reports, Recommendations & Studies, p 810 (1963).
Our task therefore must be to devise an objective definition of "governmental function” which will further this legislative judgment.
Const 1963, art 1, § 1 sets forth a simple, fundamental concept of government.
"All political power is inherent in the people. Government is instituted for their equal benefit, security and protection.”
In our organized society, people, through the state constitution they have ratified and the laws enacted by representatives they have elected, require or authorize their government to perform certain activities in their behalf. People allow government to handle these matters for a variety of reasons. Often, an individual or group of people cannot accomplish an activity or project because of, e.g., the amount of financing required, the tremendous risks involved, or the size or scope of the project or activity. Regardless of the reason, however, the fact that the people have delegated these responsibilities to government indicates their belief that a particular activity or function is one which the government must or can undertake to meet their individual and collective needs. In other words, the people, by mandating or authorizing the government to engage in certain activities, have determined that these activities are governmental in nature.
Conversely, activities which are not mandated or authorized by the people cannot be deemed governmental. When a governmental agency engages in such activities, it is acting for itself, rather than on behalf of the people. In these situations, the agency should be treated the same as a private tortfeasor.
We therefore conclude that a governmental function is an activity which is expressly or impliedly mandated or authorized by constitution, statute, or other law. When a governmental agency engages in mandated or authorized activities, it is immune from tort liability, unless the activity is proprietary in nature (as defined in § 13) or falls within one of the other statutory exceptions to the governmental immunity act. Whenever a governmental agency engages in an activity which is not expressly or impliedly mandated or authorized by constitution, statute, or other law (i.e., an ultra vires activity), it is not engaging in the exercise or discharge of a governmental function. The agency is therefore liable for any injuries or damages incurred as a result of its tortious conduct.
We realize that the definition we have formu lated today is broad and encompasses most of the activities undertaken by governmental agencies. We have adopted this approach because we believe that this is the result envisioned by the enactors of the governmental immunity act. We note, however, that our definition may be statutorily modified to reflect more accurately the desires and needs of the public.
IV. Vicarious Liability of Governmental Agencies for the Torts of Their Officers, Employees, and Agents
The tort liability of a governmental agency can be premised on two distinct theories. The plaintiff may allege that the agency itself acted, or failed to act, in a tortious manner. In such situations, the agency will be held directly liable for its torts if the activity in which it was engaged constituted a non-governmental or proprietary function, or fell within the statutory "highway,” "motor vehicle,” or "public building” exceptions.
The plaintiff may also allege that the governmental agency is vicariously liable for the torts of its officers, employees, and agents. This vicarious liability is premised on the employer-employee or principal-agent relationship which exists between the agency and the individual tortfeasor. Plaintiffs often seek to impose liability even though the governmental agency played no part in the tort, did nothing whatsoever to aid or encourage it, or may have done everything possible to stop it. See Prosser, Torts (4th ed), § 69, p 458.
Unfortunately, plaintiffs often do not clearly differentiate between direct and vicarious liability theories in their pleadings. The problem lies in part with the governmental immunity act. The act focuses primarily upon the actions of the agency itself. The "motor vehicle” exception in § 5 is the only instance where a governmental agency is explicitly held vicariously liable for the negligent actions of its officers, employees, and agents. Section 8 authorizes an agency to furnish an attorney to appear on behalf of or pay claims and judgments rendered against an officer or employee who negligently causes injuries while in the course of employment and while acting within the scope of his or her authority. An agency is also permitted under § 9 to purchase liability insurance in order to indemnify and protect itself and/or its officers, employees, and agents. However, if the agency decides to take any of the aforementioned action, such action does not impose any liability on the agency. §§ 8(3), 9.
Despite the. act’s general silence as to if or when vicarious tort liability may be imposed upon a governmental agency, this Court impliedly acknowledged the continued existence of common-law respondeat superior theories of recovery in Lockaby v Wayne County, 406 Mich 65; 276 NW2d 1 (1979), Galli v Kirkeby, 398 Mich 527; 248 NW2d 149 (1976), and McCann v Michigan, 398 Mich 65; 247 NW2d 521 (1976). Nevertheless, courts must be careful not to destroy an agency’s immunity by indiscriminately imposing vicarious liability whenever individual officers, employees, and agents are held personally liable for their torts.
Allegations of vicarious tort liability generally arise where an employment relationship exists between the governmental agency and the individ ual tortfeasor. Respondeat superior liability generally can be imposed only where the individual tortfeasor acted during the course of his or her employment and within the scope of his or her authority. If either of these conditions is not met, a governmental agency cannot be held vicariously liable:
"The question of the liability of a municipality under the doctrine of respondeat superior is subject, ordinarily, to the same rules as govern the liability of any other corporation or individual. Thus, it must appear that an agent or servant was acting within the scope of his authority at the time the injury complained of occurred. If he was not, the municipal corporation is not liable. Also, the act of the agent or servant must have been done in the course of the employment. * * * [A municipal corporation is not] liable for * * * unauthorized and unlawful acts of its officers and employees which are outside the scope of their authority, although purported to be done on the behalf of the corporation; it must further appear that such persons were expressly authorized by the municipal government to do the acts complained of, or that they were done in pursuance of a general authority to act for the municipality, on the subject to which they related. A municipal corporation may, however, be liable for an unlawful and unauthorized act of one of its officers or agents if the act was done in the course of his official duty or employment, and within the general scope of his authority.” 57 Am Jur 2d, Municipal, School, and State Tort Liability, § 88, pp 99-100.
Even when the tort is committed during the employee’s course of employment and is within the scope of the employee’s authority, the governmen tal agency is not automatically liable. Where the individual tortfeasor is acting on behalf of an employer, the focus should be on the activity which the individual was engaged in at the time the tort was committed. A governmental agency can be held vicariously liable only when its officer, employee, or agent, acting during the course of employment and within the scope of authority, commits a tort while engaged in an activity which is nongovernmental or proprietary, or which falls within a statutory exception. The agency is vicariously liable in these situations because it is in effect furthering its own interests or performing activities for which liability has been statutorily imposed. However, if the activity in which the tortfeasor was engaged at the time the tort was committed constituted the exercise or discharge of a governmental function (i.e., the activity was expressly or impliedly mandated or authorized by constitution, statute, or other law), the agency is immune pursuant to § 7 of the governmental immunity act. See Hirych v State Fair Comm, 376 Mich 384, 391-393; 136 NW2d 910 (1965), and Sherbutte v Marine City, 374 Mich 48, 50; 130 NW2d 920 (1964) (city cannot be held vicariously liable for torts of its police officers committed during the course of an arrest because the officers were engaged in police activity, which is a governmental function entitled to immunity).
This type of analysis will require plaintiffs to plead their causes of action more precisely. Such precision is necessary to ensure that governmental agencies retain the full extent of immunity from tort liability which the Legislature intended.
V. Individual Immunity
Like sovereign and governmental immunity, the scope of immunity from tort liability granted to officers, employees, and agents of a governmental agency is not presently clear. Prior to 1979, officers, employees, and agents were immune when engaged in discretionary, as opposed to ministerial, acts which were within the scope of their authority. In Wall v Trumbull, 16 Mich 228, 235-238 (1867), Justice Cooley explained that the members of a township board could not be held liable for authorizing an allegedly illegal tax:
"In determining whether the members of the township board voting for the allowance are liable, the first question which arises is, whether the nature of their duties is judicial, or ministerial only; for the rule of liability is altogether different in the two cases. A ministerial officer has a line of conduct marked out for him, and has nothing to do but to follow it; and he must be held liable for any failure to do so which results in the injury of another. A judicial officer, on the other hand, has certain powers confided to him to be exercised according to his judgment or discretion; and the law would be oppressive which should compel him in every case to decide correctly at his peril. It is accordingly a rule of very great antiquity that no action will lie against a judicial officer for any act done by him in the exercise of his judicial functions, provided the act, though done mistakenly, were within the scope of his jurisdiction[.] [Citations omitted.] This principle of protection is not confined to courts of record, but it applies as well to inferior jurisdictions * * *. Nor does the rule depend upon whether the tribunal is a court or not; it is the nature of the duties to be performed that determines its application.
"[0]fficers, judicial as well as ministerial,-have been held liable when acting without jurisdiction. * * * The rule of official exemption depends in these cases upon jurisdiction; but wherever that appears and is not exceeded, the protection is complete.
"The board then had jurisdiction to determine whether the claim was within the law or not, and their record, showing the presentation of the claim, would affirmatively show jurisdiction.
"If we were at liberty to pass upon these claims ourselves, upon the evidence appearing in this record, I should be inclined to think the board decided correctly as to some of the claims, and erred as to others. But nothing could be more apparent than the injustice of reviewing their decision in a suit against them in trespass. For whether each particular claim was within the law or not, would depend upon the proof as to whether the money was advanced upon the credit of the township; and the showing on this point might be very different before the board, and in the circuit court. To hold the members of the board responsible in such a case, we must not only hold them bound to decide correctly at their peril, upon the evidence presented to them, but we must also hold that at their peril they must come to the same conclusion as to the legality of the claim which the circuit judge will afterwards arrive at on another hearing, when the testimony may be either more or less than they acted upon, and when even the same witnesses may have told a different story. The mere statement of such a proposition seems to me sufficient to refute it.”
The doctrine of individual immunity even survived the abolition of common-law governmental immunity. Justice Edwards, in his opinion in Williams, supra, 364 Mich 261-262, wrote:
"[T]here are and will continue to be many situations in relation to which real or fancied grievances exist where governmental freedom from liability will persist on wholly different grounds. Legislative bodies, for example, have the right to make many types of decisions which may do harm to some. Subsequent history may clearly demonstrate that some of those decisions were wrong. Discretion implies the right to be wrong. So long as those decisions are within the discretion vested in the legislative body, there is clearly neither breach of duty nor a right to damages. The instant case, a tort action, does not in any manner alter the fact that actions or decisions of a legislative, executive, or judicial character which are performed within the scope of authority of the governmental body or officer concerned continue to enjoy freedom from liability.
"The people place great powers of decision making in the hands of their government. In the exercise of discretionary power, governmental duty runs to the benefit of the whole public, rather than to individuals. It is of great importance that this crucial function of democratic decision making be unhampered by litigation.
The governmental immunity act does not address whether or when individual officers, employees, and agents are immune from tort liability. It merely authorizes governmental agencies to defend, indemnify, and insure officers and employees who have committed negligent torts during the course of their employment and while acting within the scope of their authority. §§ 8, 9. Thus, the existence and scope of individual immunity continues to be a creature of judicial decision-making.
Unfortunately, two recent decisions of this Court have obfuscated the precise parameters of individual immunity. In Bush v Oscoda Area Schools, 405 Mich 716; 275 NW2d 268 (1979), plaintiffs sued a school district, its superintendent, a principal, and a teacher concerning injuries incurred by a student during a science classroom explosion. Three members of the Court summarily concluded that the complaint stated a claim against the individual defendants. Id., p 733 (opinion of Levin, J.). Justice Moody, joined by Chief Justice Coleman, wrote that the superintendent, principal, and teacher were immune from liability for their ordinary negligence because they "were performing primarily discretionary activities that are of essence to government” and which were public in nature. Id., p 734. Justice Williams believed that only the ultra vires activities of public employees are not protected by governmental immunity because the exercise or discharge of a governmental function is not involved. Id. Justice Ryan stated that the immunity defense was applicable if the school district and employees were engaged in the exercise or discharge of a governmental function. Id., pp 734-735. The end result was that the individual officials and employees were immune from tort liability unless they had been engaged in ultra vires activities. None of the opinions mentioned the traditional "discretionary/ministerial” test.
Lockaby v Wayne County, 406 Mich 65; 276 NW2d 1 (1979), added to the confusion. There, an action was brought inter alios against the Wayne County Sheriff and the administrator of the county jail for the intentional assaults and mistreatment of an inmate by unidentified jail personnel. Justice Levin, joined by Justices Kavanagh and Fitzgerald, concluded that although the sheriff could not be held responsible for the acts of his deputies by statute, he was responsible for his own acts of negligence and the tortious acts of employees who were not deputies pursuant to the common-law doctrine of respondeat superior. Similarly, the jail administrator was responsible for his own negligence. Although Justice Levin recognized that government officials have limited immunity at common law, the decision as to whether immunity actually existed was deferred until after trial. Id., pp 77-78.
Justice Moody wrote that the county officers and employees, while acting within the scope of their employment (i.e., operating and maintaining a jail), were primarily performing essential public duties and therefore were immune from tort liability for their negligent actions and selection of personnel. In addition, plaintiff had failed to allege that the sheriff or administrator had committed or condoned any intentional acts. Id., p 84. The remaining three justices essentially agreed with this reasoning. Id., pp 79, 82. However, Justice Williams noted that intentional torts may be protected by governmental immunity as long as they do not constitute ultra vires activities and are within the scope of the exercise and discharge of a governmental function. Id., pp 82-83.
The tendency of this Court to define individual immunity with respect to "governmental function” has been criticized as blurring two separate inquiries. As noted in Williams, individual immunity may exist where sovereign or governmental immunity does not. For example, a governmental agency which runs a statutorily mandated or authorized activity that is proprietary in nature would not be entitled to immunity under § 13. However, those officials and employees who are required to make decisions as to how the proprietary activity must be carried out should be entitled to immunity as long as they are acting within the scope of their authority and during the course of their employment. Individual immunity exists to ensure that a decision-maker is free to devise the best overall solution to a particular problem, undeterred by the fear that those few people who are injured by the decision will bring suit. We therefore will no longer define the parameters of individual immunity with reference to whether the tortfeasor was engaged in the exercise or discharge of a governmental function.
The "ultra vires” element of the individual immunity test also has its drawbacks. By definition, ultra vires activities are those which are unauthorized and outside the scope of employment. Officials and employees who engage in such activities have never been immune from tort liability, even under the traditional "discretionary/ministerial” test. However, under the present formulation of the "ultra vires” test, immunity is extended to every public official, employee, and agent whenever they engage in authorized acts, including those which are merely ministerial. Such broad individual immunity is not justified by either prior case law or present-day realities. The mere fact that individuals are employed by a governmental agency does not relieve them of the responsibility to perform their duties properly and conscientiously.
Michigan’s traditional "discretionary/ministerial” approach to individual immunity is somewhat different than that of other jurisdictions. Michigan case law affords absolute immunity to all public officials, employees, and agents for both intentional and negligent torts whenever they are engaged in discretionary acts within the scope of their authority. In contrast, other jurisdictions have extended different levels of immunity depending upon the function of the officer. Absolute immunity from tort liability is granted to judges, legislators, and the highest executive officials of all levels of government, even for malicious acts, as long as they are acting within their respective judicial, legislative, and executive authority. Lower level officers, employees, and agents are extended only qualified immunity. This immunity exists when the individual is engaged in discretionary acts which are performed in good faith. An employee therefore risks liability for negligently performed ministerial acts, regardless of good faith. Prosser, supra, § 132, pp 987-990, and cases cited therein; Littlejohn & DeMars, Governmental Immunity After Parker and Perry: The King Can Do Some Wrong, 1982 Det C L Rev 1, 25-27.
This disparate treatment of individuals based upon their official function has been justified as follows:
"It is assumed through the broad grant of immunity to certain public employees that these officials and, therefore, their governmental agencies, will not be intimidated nor timid in the discharge of their public duties. Although absolute immunity may be necessary for unfettered governmental decision-making, courts have been reluctant, understandably, to extend its protection beyond select public employees who are delegated policy-making powers.
"* * * The policy which only provides a limited immunity to lower level executive officials, unlike the justifications for absolute immunity, reflects a recogni tion that official immunity should not shield malicious or intentionally unlawful behavior when the actor is not engaged in broad, essential governmental decision-making. Holding these public servants liable does not hamper or intimidate them in the faithful discharge of their duties since they are responding to established administrative guidelines, regulations and informal policy. It is assumed, therefore, that an unreasonable burden does not fall on an administrative system when courts hold lower level executive employees liable for their acts performed in bad faith.” Littlejohn & DeMars, supra, pp 27-28.
We are persuaded that a similar scheme of individual immunity should be adopted in Michigan. We therefore hold that judges, legislators, and the highest executive officials of all levels of government are absolutely immune from all tort liability whenever they are acting within their judicial, legislative, or executive authority. Lower level officials, employees, and agents are immune from tort liability only when they are
1) acting during the course of their employment and acting, or reasonably believe they are acting, within the scope of their authority;
2) acting in good faith; and_
3) performing discretionary, as opposed to ministerial acts.
Under this test, no individual immunity exists for ultra vires activities.
The final problem is defining "discretionary” and "ministerial” acts. Because of the longstanding difficulty of accurately differentiating between discretionary and ministerial acts, some writers have suggested that the distinction be abandoned. We decline this opportunity to do so. The "discretionary/ministerial” test has a long common-law history and grants immunity to individuals only to the extent necessary to guarantee unfettered decision-making.
"Discretionary” acts have been defined as those which require personal deliberation, decision, and judgment. Prosser, supra, § 132, p 988. This definition encompasses more than quasi-judicial or policy-making authority, which typically is granted only to members of administrative tribunals, prosecutors, and higher level executives. However, it does not encompass every trivial decision, such as "the driving of a nail,” which may be involved in performing an activity. For clarity, we would add the word "decisional” so the operative term would be "discretionary-decisional” acts.
"Ministerial” acts have been defined as those which constitute merely an obedience to orders or the performance of a duty in which the individual has little or no choice. Id. We believe that this definition is not sufficiently broad. An individual who decides whether to engage in a particular activity and how best to carry it out engages in discretionary activity. However, the actual execution of this decision by the same individual is a ministerial act, which must be performed in a nontortious manner. In a nutshell, the distinction between "discretionary” and "ministerial” acts is that the former involves significant decision-making, while the latter involves the execution of a decision and might entail some minor decision-making. Here too, for clarity, we would add the word "operational” so the operative term would be "ministerial-operational” acts.
Many individuals are given some measure of discretionary authority in order to perform their duties effectively. Therefore, to determine the existence and scope of the individual’s immunity from tort liability in a particular situation, the specific acts complained of, rather than the general nature of the activity, must be examined. The ultimate goal is to afford the officer, employee, or agent enough freedom to decide the best method of carrying out his or her duties, while ensuring that the goal is realized in a conscientious manner.
Under the rules set forth today, it is obvious that the immunity extended to individuals is far less than that afforded governmental agencies. We believe that this was the result intended by the Legislature. The threat of personal liability for engaging in ultra vires activities or tortiously executing one’s duties may be the most effective way of deterring improper conduct. We note, however, that a governmental agency is statutorily authorized to defend or indemnify its officers, employees, and agents in its discretion under certain circumstances. This statutory authorization could be the basis for a contractual agreement of representation and indemnification.
VI. Application of Law to Cases
Ross v Consumers Power Co
Appellant, the John Saines Project I Drainage District, contracted the construction of a drain to Dunigan Brothers, Inc. Since a portion of the drain was to be constructed on property owned by appellee, Consumers Power Company, Consumers granted an easement to Jackson County. On August 24, 1971, Michael Ross, a Dunigan employee, was injured when a vehicle in or near which he was working came in contact with overhead electric power lines maintained by Consumers.
Ross sued Consumers and the action was eventually settled. Consumers filed an amended third-party complaint against the district and drain commissioner, alleging two counts in contract and one count in tort. The Court of Appeals summarized the allegations contained in the tort claim as follows:
"In its essentials, Consumers’ tort claim against the District alleges negligence arising out of a failure to notify Consumers that work was being undertaken that could interfere with the power lines, a failure to make arrangements with Consumers to safeguard workers from contact with the lines, a failure to instruct and warn its contractors concerning the lines, a failure to hire a properly licensed and competent contractor, and a failure to adequately supervise and inspect the project in such a manner as to prevent the accident from occurring.” 93 Mich App 687, 697; 287 NW2d 319 (1979).
The trial court granted the district and commissioner’s motion for summary judgment as to all three counts. Consumers appealed only the judgment for the district. The Court of Appeals reversed as to the two contract counts because § 7 of the governmental immunity act does not grant immunity from contract liability. Applying Justice Moody’s "essence of governing” test, the Court concluded that the district was also not immune from tort liability because the construction of a drain is not of the essence of governing. The district appealed only the decision concerning the tort claim. This Court affirmed by an equally divided Court, 415 Mich 1; 327 NW2d 293 (1982), but subsequently granted rehearing. 417 Mich 1113 (1983).
This appeal involves only the direct liability of a non-sovereign governmental agency for its negligence in contracting out, supervising, and inspecting the construction of a drain. The crucial inquiry is whether these activities, from which the injuries arose, constitute the exercise or discharge of a non-proprietary, governmental function. There is no allegation that any of these activities were conducted by the district primarily for pecuniary profit. We therefore must determine whether the contracting out, supervision, and inspection of the construction were activities which the district was expressly or impliedly mandated or authorized by constitution, statute, or other , law to perform.
Const 1963, art 4, §§ 51 and 52 require the Legislature to provide for the protection and promotion of public health and the state’s natural resources. The Drain Code of 1956, MCL 280.1 et seq.; MSA 11.1001 et seq., is a comprehensive act governing the establishment of drainage districts and construction of drains. A drainage district has the power to contract under § 5, and the drain commissioner is specifically authorized to let out construction contracts under prescribed circumstances. See, e.g., §§ 151,154, 221-223, 471. Furthermore, the commissioner, or a competent designatee, is required to inspect „and approve all construction work. § 241. Any right to supervise the actual construction of a drain is impliedly author ized by the district’s general power over the establishment, construction, and maintenance of drains. The trial court correctly found that the district is immune from tort liability.
Willis v Nienow
Willis v Dep’t of Social Services
The Court of Appeals summarized the facts of these cases as follows:
"These cases arose out of the same incident and were consolidated on appeal. Plaintiff is the administratrix of the Estate of Jeffrey Willis. On August 16, 1978, 16-year-old Jeffrey was a resident of Harbor House, a juvenile care facility for delinquent and neglected youths operated by defendant Department of Social Services. At Harbor House, defendant Dennis Nienow was the director, defendant Erma Knox was a counselor, and defendant Cindy Hunt was a student-intern. Jeffrey and other Harbor House residents were taken for a swimming outing on Lake Michigan under the supervision of Knox and Hunt. Jeffrey drowned in the course of the outing.
"Plaintiff brought actions against defendants State of Michigan and Department of Social Services in the court of claims and against defendants Nienow, Knox, and Hunt in circuit court. Plaintiff’s complaints alleged that Jeffrey and Knox could not swim or were of marginal swimming ability, that neither Knox nor Hunt had lifesaving training, that there were no lifeguards on duty at the time in question, that Jeffrey and other Harbor House residents were allowed to swim in areas not designated as swimming areas, and that Jeffrey and the other residents were allowed to swim under dangerous weather conditions. In each case the trial court granted summary judgment for defendants based on governmental immunity * * *.” 113 Mich App 30, 32-33; 317 NW2d 273 (1982).
The Court of Appeals, applying Justice Moody’s reasoning in Perry, concluded that the operation of a juvenile care facility constitutes a governmental function and that recreational activities are directly related to an effective program of caring for the children. Using the traditional "discretionary/ministerial” test for individual immunity, the Court concluded that defendant Nienow’s hiring decisions involved discretionary acts which were entitled to immunity, but the manner in which the swimming outing was conducted involved ministerial acts. Finally, the Court held that plaintiff had failed to state a cause of action for intentional tort. Thus, judgment for the state and DSS was affirmed, but reversed as to the individual defendants.
Plaintiff essentially alleges that Nienow, Knox, and Hunt were negligent or reckless in allowing decedent to participate in the swimming outing and in failing to adequately care for and supervise him. In deciding whether these defendants are entitled to immunity, we must determine whether they were 1) acting during the course of their employment and within the scope of their authority; 2) acting in good faith; and 3) performing discretionary-decisional acts.
There is no suggestion that the supervision of children during recreational activities was not during the course of defendants’ employment or within the scope of their authority. There is no allegation of bad faith. Assuming that each defen dant had the authority to, and in fact did, decide who would participate in the outing, as well as when and where it would be conducted, we hold that these were discretionary-decisional acts entitled to immunity. However, the execution of these decisions, which included the care and supervision of the participating children, were ministerial-operational acts that entailed only minor decision-making.
As to defendant Nienow, plaintiff alleged that he was negligent in hiring Knox and Hunt. There is no suggestion that the hiring of personnel was outside the course of Nienow’s employment or beyond the scope of his authority. Nor is bad faith alleged. We agree with the Court of Appeals that the decision to hire Knox and Hunt was a discretionary-decisional act entitled to immunity.
The complaint against the state and the DSS does not clearly differentiate between direct and vicarious liability theories. It can be read as alleging that defendants themselves did not adequately care for and supervise decedent, or that they are vicariously liable for their employees’ negligent care and supervision. Assuming that a vicarious liability theory was pleaded, we have already assumed that the employees were acting during the course of their employment and within the scope of their authority. The question therefore is whether allowing decedent to participate in a swimming outing, and the care and supervision of decedent during the outing, constitute the exercise or discharge of a non-proprietary, governmental function.
There is no allegation that the swimming outing was conducted primarily for pecuniary profit. Furthermore, recreational activities for delinquent and neglected children residing in state facilities are impliedly authorized by statute. The Social Welfare Act, MCL 400.1 et seq.; MSA 16.401 et seq., requires the DSS, through the office of children and youth services, to operate halfway houses, regional detention facilities, etc., with the goal of providing "an effective program of out-of-home care.” § 115(a). Recreational activities can be an important part of such a program. Implicit in the authority to conduct such activities is the authority to decide who will participate in them.
Finally, the DSS is expressly required by statute to care for and supervise children residing in state facilities. Sections 3 and 4(1) of the Youth Rehabilitation Services Act, MCL 803.301 et seq.; MSA 25.399(51) et seq., require the DSS to supervise and operate state facilities and programs for the proper care of delinquent and neglected children. Even if this statute did not exist, the care of resident children implies a responsibility to supervise them in order to prevent, as far as is practicable, any unnecessary injury. We therefore conclude that the state and the DSS are entitled to sovereign immunity from tort liability since the injuries arose while they and their employees were engaged in the exercise or discharge of a governmental function.
We also conclude that plaintiff failed to state a claim of intentional tort against any of the defendants for the reasons stated by the Court of Appeals.
Siener v Dep’t of Mental Health
Plaintiff Russell Siener, Jr., was an in-patient at the Hawthorn Center, a state mental health facility for emotionally disturbed children. On July 8, 1976, plaintiff and several other patients were taken by the center’s personnel on a field trip to Greenfield Village in Dearborn, Michigan. Plaintiff maintained that a supervisor had permitted five boys, including himself, to leave the group without supervision. Subsequently, one of the boys seriously injured plaintiff by striking him in the face with a cast iron pot lid.
Plaintiff brought a negligence action against the state, the Department of Mental Health, and the Hawthorn Center alleging that they had failed to properly supervise and control the patients. The Court of Claims denied defendants’ motion for summary judgment because plaintiff had pled facts in avoidance of governmental immunity. The Court of Appeals reversed. 117 Mich App 179; 323 NW2d 642 (1982). The Court found that under Perry, the operation of a state mental health facility for children is a governmental function. Furthermore, the field trip was directly related to the effective care of emotionally disturbed children. The Court rejected plaintiff’s argument that MCL 330.1722; MSA 14.800(722) is a statutory exception to the governmental immunity act.
The complaint could be read as alleging that defendants are directly liable because of their failure to provide adequate supervision and control over plaintiff and the other patients, or that defendants are vicariously liable for their employees’ negligent supervision. (Plaintiff apparently has not commenced an action against the individual employees.) Plaintiff does not argue that the field trip should not have been conducted, or that he should not have been allowed to participate. Assuming that a vicarious liability theory was pleaded, there is no suggestion that the employees who supervised the patients during the field trip were not acting during the course of their employment or within the scope of their authority. Furthermore, there is no allegation that the trip was conducted primarily for pecuniary profit. We must therefore determine whether the control and supervision of emotionally disturbed patients by defendants and their employees during a field trip is expressly or impliedly mandated or authorized by constitution, statute, or other law.
Educational and recreational field trips for emotionally disturbed, in-patient children are impliedly authorized by constitution and statute. Const 1963, art 8, § 8 states that programs and services for the care, treatment, education, or rehabilitation of the mentally or otherwise seriously handicapped shall always be fostered and supported. Section 116 of the Mental Health Code, MCL 330.1001 et seq.; MSA 14.800(1) et seq., authorizes the Department of Mental Health to provide directly, or through contractual arrangement, any type of patient service related to the treatment, care, education, training, and rehabilitation of the mentally ill or retarded. In addition, a child who resides in a mental health facility is entitled to an education. § 738.
Finally, the Department of Mental Health and the Hawthorn Center are expressly and impliedly required by statute to adequately control and supervise in-patients of mental health facilities. All residents are entitled to a safe, sanitary, and humane living environment. § 708. The governing body of a mental health facility is responsible for the operation of the facility, the selection of the medical staff, and the quality of care rendered. § 143. Implicit in the notion of caring for emotionally disturbed patients is the responsibility to control and supervise them to prevent, as far as is practicable, any unnecessary injury. We therefore conclude that defendants are entitled to sovereign immunity from tort liability since the injury arose while they and their employees were engaged in the exercise or discharge of a governmental function.
Plaintiff maintains the defendants are nevertheless liable because § 722 of the Mental Health Code is an exception to §7 of the governmental immunity act. Section 722 provides in part that if a recipient of mental health services is physically or otherwise abused, the recipient has a right to pursue injunctive and other appropriate civil relief. We disagree with plaintiffs argument for the reasons stated in Rocco v Dep’t of Mental Health, 114 Mich App 792, 798-799; 319 NW2d 674 (1982):
"MCL 330.1700 et seq.; MSA 14.800(700) et seq., enumerates certain rights possessed by recipients of mental health services. The statute’s purpose is to ensure that patients are treated in a humane manner and that their privacy is maintained. The statute focuses on the duty of the health care facility towards its patients. None of the sections discusses the rights and responsibilities between patients. The statute’s primary purpose is to protect the patient from certain abuses by the mental health facility or its staff. When this purpose is read into MCL 330.1722; MSA 14.800(722), it is clear that this provision was meant to prevent the staff of a mental health care facility from abusing the patients in its care. It was not the intention of the Legislature to abolish governmental, immunity in those cases where one patient attacks another.”_
Rocco v Dep’t of Mental Health
The Court of Appeals summarized the facts of this case as follows:
"On January 7, 1980, plaintiffs’ decedent, Daniel Rocco, was a resident patient of the Ypsilanti Regional Psychiatric Hospital (hospital). That night, while he was sleeping in his hospital bed, Rocco was murdered by another patient. The murderer was Andrew Higginbotham, a patient who had a history of violence and assaultive behavior.
"Plaintiffs filed a complaint in the Court of Claims against two state agencies (the Department of Social Services and the Department of Mental Health) which supervise the administration of the hospital, and the hospital. The state agencies and hospital are hereinafter referred to as defendants. The complaint consisted of two counts. Count I alleged negligence in that defendants failed to take steps to protect the decedent from attack by violent patients in the hospital. Specifically, plaintiffs alleged that defendants breached their duty of care and committed malpractice in that they were aware of Higginbotham’s violent and criminal tendencies, yet placed him unrestrained and unsupervised in the same ward with the decedent. Count II alleged breach of implied contract, averring that plaintiffs agreed to and did in fact pay for the care and treatment of the decedent but that defendants breached their contractual duty by failing to protect the decedent from harm and abuse by other patients at the hospital.” Rocco, supra, pp 794-795.
Defendants were granted summary judgment on both counts. The Court of Appeals affirmed the judgment as to Count I, concluding that the operation of a state mental hospital is a governmental function and that § 722 of the Mental Health Code is not an exception to governmental immunity. As to Count II, the majority held that the breach of an implied contract claim was not merely a restatement of the tort claim. Since the governmen tal immunity act does not bar contract claims, judgment for defendants was reversed.
The tort claim alleges that defendants are directly and vicariously liable. As to the vicarious liability theory, there is no suggestion that defendants’ employees were not acting during the course of their employment or within the scope of their authority. Although plaintiffs paid for the care rendered to decedent by the hospital, there is no allegation that the hospital provided súch care primarily for pecuniary profit. In fact, § 808 of the Mental Health Code specifically limits the total financial liability of a recipient of mental health services to the cost of the services rendered. The crucial inquiry therefore is whether the placement of patients within a mental health facility, and the care, control, and supervision of in-patients, are activities which are expressly or impliedly mandated or authorized by constitution, statute, or other law.
The evaluation of patients upon admission and periodically thereafter is expressly mandated by § 710 of the Mental Health Code. A patient may be secluded or his freedom of movement restricted only insofar as such action is necessary to prevent the patient from physically harming himself or others, or causing substantial property damage. §§ 742(2), 744. The governing body of a mental health facility is required to establish the maximum length of time seclusion may last, how often the patient must be examined, and any other appropriate regulations. § 742(6). Finally, we have previously concluded in Willis and Siener, supra, pp 638-644, that the Department of Mental Health, the DSS, and a mental health facility have an express and implied responsibility to care for, control, and supervise residents of state facilities. We therefore hold that defendants are entitled to sovereign immunity from tort liability because the injuries arose while they and their employees were engaged in the exercise or discharge of a governmental function. As in Siener, we reject plaintiffs’ argument that § 722 is an exception to the governmental immunity act.
Defendants recognize that the governmental immunity act grants immunity only from tort liability, but maintain that plaintiffs’ contract claim should be dismissed because it merely restates the allegations contained in their tort count. We disagree. Defendants brought their motion for summary judgment under GCR 1963, 117.2(1). Such motions test the legal basis of the complaint, not whether it can be factually supported. Accepting as true a plaintiff’s allegations, and any conclusions that may reasonably be drawn therefrom, the motion must be denied unless the claim is so clearly unenforceable as a matter of law that no factual development could justify a right to recover. Although most of the allegations contained in Counts I and II are identical, the latter count also alleges that plaintiffs contracted and agreed with defendants for decedent’s care and treatment; plaintiffs paid valuable consideration for decedent’s care; and defendants breached their contractual duties to plaintiffs and decedent. These allegations are sufficient to withstand defendants’ challenge.
We recognize that plaintiffs have and will attempt to avoid § 7 of the governmental immunity act by basing their causes of action on theories other than tort. Trial and appellate courts are routinely faced with the task of determining whether the essential elements of a particular cause of action have been properly pleaded and proved. If a plaintiff successfully pleads and establishes a non-tort cause of action, § 7 will not bar recovery simply because the underlying facts could have also established a tort cause of action.
Regulski v Murphy
Plaintiff, a seventeen-year-old attending high school in defendant Wayne-Westland School District, was enrolled in a building trades class, which was offered as part of the school’s vocational education program. Participating students were required to build a house, which was then sold by the district to a private buyer. On October 10, 1975, plaintiff was injured when he attempted to hammer a nail into a piece of wood. Apparently, he hit the nail at an angle, causing it to fly up and strike him in the eye.
Plaintiff sued the school district, the director of the vocational building trades program, and the instructor of the class. In his amended complaint, plaintiff alleged that the district was engaged in a proprietary function and that all of the defendants were negligent in failing to properly instruct, warn, and supervise plaintiff. In addition, defendants had failed to provide safety glasses, adequate first-aid supplies at the site, and transportation for emergencies. After discovery was completed, defendants moved for and were granted summary judgment. The Court of Appeals affirmed, concluding that the operation of a building trades class is a governmental function which entitled the district to governmental immunity. Since the individual defendants were engaged in a governmental function, they too were immune. 119 Mich App 418; 326 NW2d 528 (1982).
The cause of action against the school district alleges both direct and vicarious liability. As to the vicarious liability theory, there is no suggestion that the individual defendants were not acting during the course of their employment or within the scope of their authority. We therefore must determine whether the instruction and supervision of students enrolled in a building trades class, as well as the provision of safety devices and measures, constitute the exercise or discharge of a non-proprietary, governmental function.
Plaintiff alleged that the district built and sold the house "for the purpose of producing a pecuniary profit.” The district disagreed and offered evidence showing that the class was not designed to be a profit-making venture and that the district in fact lost money on the sale of the house. We need not decide whether a governmental agency must actually realize a pecuniary profit from the challenged activity before § 13 of the governmental immunity act will allow a tort recovery, or whether there was no genuine issue or material fact on this point. During arguments on the motion for summary judgment, plaintiff’s counsel admitted that the class was not conducted primarily for pecuniary profit. Instead, he argued below and here that the seeking of remuneration and the possibility of any incidental profit is sufficient evidence of a proprietary function. Although at one time any incidental profit generated by an activity was sufficient to defeat an agency’s claim of immunity, the Legislature in § 13 has modified this rule to require that the activity be conducted primarily for pecuniary profit. On the basis of these facts, we conclude that the operation of the building trades class was not a proprietary function.
The board of a school district is required under § 1282 of the School Code of 1976, MCL 380.1 et seq.; MSA 15.4001 et seq., to establish and carry on the departments it deems necessary or desirable, determine the courses of study to be pursued, and cause its pupils to be taught in the depart ments it deems expedient. The board is expressly authorized by § 1287 to establish, equip, and maintain vocational education programs and facilities. Section 1288 specifically requires each pupil participating in certain vocational and industrial arts classes to wear eye protective devices. Furthermore, the board must make reasonable regulations concerning anything necessary for the proper establishment, maintenance, management, and carrying on of public schools, including regulations concerning the safety of children while in attendance at school, or en route to and from school. § 1300. Thus, the district was expressly authorized to offer the building trades course and was expressly and impliedly required through its employees to instruct, warn, and supervise the students, as well as to provide safety equipment and measures, in order to prevent any unnecessary harm to the students. Since the injuries arose while the district and its employees were engaged in the exercise or discharge of a governmental function, the district is entitled to governmental immunity from tort liability.
As to the liability of the individual defendants, we have already assumed that they were acting during the course of their employment and within the scope of their authority. There is no allegation that they were acting in bad faith. The question therefore is whether they were engaged in discretionary-decisional acts.
Plaintiff has not alleged that the individual defendants were negligent in offering the class, allowing him to participate, or deciding where and when to conduct the class. Such acts are discretionary-decisional in nature. Instead, plaintiff alleged that defendants were negligent in instructing, warning, and supervising him. Although some decision-making is involved in these activities, it is relatively minor. Instruction and supervision are essentially ministerial-operational activities for which there is no immunity from tort liability.
As to the allegation of inadequate safety measures, we have previously noted that a school board is statutorily required to provide for the safety of its students and, in particular, to provide eye protective devices to those participating in certain potentially dangerous activities. It is unclear whether plaintiff alleged that the individual defendants were negligent in establishing the type and extent of safety measures, or merely failed to provide that which was required by statute and school policy. If any of the defendants were responsible for establishing the school’s policy as to the type of eye protective devices that would be provided to the students, the type of first-aid supplies to have at the building site, and what emergency transportation measures would be provided, that defendant is immune from tort liability because these are discretionary-decisional acts. However, the individuals can be held liable for failing to comply with § 1288 and the school’s safety policy since the actual provision of eye protective devices, first-aid supplies, and emergency transportation involves only ministerial-operational acts. Summary judgment for the individual defendants is therefore reversed and the case remanded for trial.
Trezzi v City of Detroit
On April 23, 1978, plaintiff’s parents were attacked by an unknown assailant who had forcibly entered their Detroit home. When plaintiff walked by the house, he noticed that a refrigerator door was ajar and that there were no lights on in the house. Plaintiff called Detroit’s 911 emergency assistance system six times for help. Unknown 911 operators assigned a low-priority rating to the calls and passed them on to a police dispatcher. The dispatcher sent a police vehicle approximately one and one-half hours after plaintiff’s first call.
Plaintiff brought an action against the City of Detroit, the dispatcher, and the 911 operators alleging that his parents sustained fatal injuries as a result of the delayed response. When the city moved for summary judgment, plaintiff amended his complaint to allege both negligent and intentional tort. The city was granted summary judgment, the dispatcher eventually settled with plaintiff, and the suit against the unknown operators was dismissed. The city refused to defend or indemnify the dispatcher for the judgment, which apparently remains unsatisfied.
A majority of the Court of Appeals affirmed the judgment for the city. 120 Mich App 506; 328 NW2d 70 (1982). The entire panel agreed that under the "essence to governing” test, the operation of a 911 emergency system would not constitute a governmental function, although it would under the "common good of all” test. Applying Justice Moody’s "essence of governing” test, the majority concluded that the 911 system was an indispensable part of the operation of a police department with no common analogy in the private sector. The panel agreed that plaintiff’s intentional tort claim actually alleged no more than gross negligence. Plaintiff does not challenge this latter holding in this Court.
As explained in the Court of Appeals dissenting opinion, the Detroit 911 system handles emergency calls for police, fire, and medical assistance. It is staffed by civilian employees of the city, who rank the seriousness of the calls and contact police, fire, and medical dispatchers. The system is designed to make emergency assistance more effective by freeing up police and fire personnel and enabling citizens to request help by dialing three easily remembered digits. The system essentially acts as a clearinghouse for emergency calls.
This appeal involves only the vicarious liability of a non-sovereign governmental agency for its employees’ negligence. There is no suggestion that the employees were not acting during the course of their employment or within the scope of their authority. There is no allegation that the 911 system was operated primarily for pecuniary profit. We therefore must determine whether the categorizing of emergency calls by a 911 operator and the dispatch of police vehicles in accordance therewith are activities which are expressly or impliedly mandated or authorized by constitution, statute, or other law.
Const 1963, art 7, § 22 gives the electors of each city the power to frame and adopt a city charter. In addition, the city has the power to adopt resolutions and ordinances relating to its municipal concerns, property, and government. Since Detroit is a home-rule city, its charter must provide for the public peace, health, and safety of persons and property. MCL 117.3(j); MSA 5.2073(j). Pursuant to these constitutional and statutory provisions, Detroit Charter, art 7, ch 11, § 7-1101 establishes a police department -which is required to preserve the public peace, prevent crime, arrest offenders, protect the rights of persons, preserve order, and enforce laws and ordinances. Section 7-1103 authorizes the board of police commissioners to establish policies, rules, and regulations. In order to accom plish its duties, the police department necessarily needs some sort of system for accepting, processing, and acting upon calls for police assistance. Thus, the 911 emergency assistance system and the police dispatch system, including their internal procedures for determining the seriousness of calls and dispatching vehicles, are impliedly authorized by constitution, statute, and city charter. Since the injuries arose while the city’s employees were engaged in the exercise or discharge of a governmental function, the city is entitled to governmental immunity from tort liability.
Disappearing Lakes Ass’n v Dep’t of Natural Resources
Plaintiffs are property owners of land adjoining Square Lake and Little Square Lake in Oakland County. From 1966 to 1976, the Michigan Department of Conservation and its successor, the Department of Natural Resources, issued permits and extensions to a private land developer for the dredging of canals south of Lake Orion and immediately north of plaintiffs’ property. In 1977, the water level of the Square Lakes began to drop precipitously. The recreational and aesthetic purposes of the lakes were eventually destroyed. Studies indicate that the water loss was caused by interference with the subsurface water flow, which occurred when the canals were dredged.
Plaintiffs filed suit in 1979 against the state and the DNR in the Court of Claims seeking damages for nuisance and negligence. A similar action was commenced in circuit court against Orion Township, Oakland County, and several municipal boards and individuals. The suits were eventually consolidated. In 1981, the circuit court granted the state and the DNR’s motion for summary judgment on the ground of governmental immunity.
The Court of Appeals affirmed, holding that regardless of which test was applied, the issuance of dredging permits by the DNR constituted a governmental function. After examining numerous cases, the Court concluded that a governmental agency cannot be held liable in nuisance unless it actually controlled the project which created the nuisance. Issuance of dredging permits alone was not sufficient evidence of control. Plaintiffs’ claims that the state had taken their property without due process of law, that the DNR had acted outside the scope of its authority, and that plaintiffs were entitled to equitable relief were rejected because these claims had not been raised before the trial court. 121 Mich App 61; 328 NW2d 570 (1982).
Count II of plaintiffs’ complaint essentially alleges that the state and the DNR are directly and vicariously liable for negligently issuing permits without adhering to statutory guidelines or conducting proper studies, failing to warn of the possible adverse effects of dredging, and failing to revoke the permits. As to the vicarious liability theory, there is no suggestion that defendants’ employees were not acting during the course of their employment or within the scope of their authority. Nor is there any allegation that the issuance of dredging permits was conducted primarily for pecuniary profit. Therefore, we must determine whether the issuance of dredging permits and extensions, and activities related thereto, are activities which are expressly or impliedly mandated or authorized by constitution, statute, or other law.
Const 1963, art 4, § 52 requires the Legislature to provide for the protection of the state’s waters from pollution, impairment, and destruction. In 1965, the Legislature first enacted the Inland Lakes and Streams Act. See 1965 PA 291, as amended by 1968 PA 7, MCL 281.731 et seq.; MSA 11.451 et seq. This act was repealed and replaced in 1972 by a substantially similar act. See 1972 PA 346, MCL 281.951 et seq.; MSA 11.475(1) et seq. The primary purpose of both acts was the regulation and protection of the state’s inland lakes and streams.
Under the act, any person who wishes to dredge canals is required to obtain a permit from the DNR. §§ 3, 5. A permit must be issued if the project will not adversely affect the public trust or riparian rights. In making this determination, the DNR must consider the possible effects of the proposed project upon inland lakes, streams, and waters, as well as the impact on their recreational, aesthetic, and other uses. No permit can be issued if the project will unlawfully impair or destroy any waters or other natural resources. § 7. Once issued, the permit is effective for its stated term, unless revoked for cause, and may be renewed. The permit may specify the term and conditions under which the work is to be carried out. § 8.
Thus, the DNR is statutorily required to issue dredging permits once certain conditions are met and to revoke them if there is sufficient cause. In determining whether a permit should be issued, renewed, or revoked, the DNR is impliedly authorized to conduct studies and inspect the proposed and current dredging sites, although such actions are not required. The DNR is expressly authorized to impose conditions on the dredging in order to avoid adverse environmental consequences. Such conditions serve as a warning to the permittee to conduct its dredging in a careful manner. We therefore conclude that the state and the DNR are entitled to sovereign immunity from tort liability since the injuries arose while they and their employees were engaged in the exercise or discharge of a governmental function.
The Court of Appeals conclusion that plaintiffs had insufficiently pleaded a nuisance cause of action is not clearly erroneous. Plaintiffs essentially asserted only a negligence claim. The damage to the lakes may have been sufficiently severe to constitute an unconstitutional taking of private property without just compensation or warrant injunctive relief; however, plaintiffs did not raise these arguments before the trial court and have not pursued them on appeal to this Court.
Zavala v Zinser
The Court of Appeals summarized the facts of this case as follows:
"This controversy arose out of the shooting of plaintiff Jose Zavala outside a Detroit bar in the early morning hours of November 2, 1975. As Mr. Zavala left the bar that morning, he encountered a large group of people in front of the building; some of the people, including Mr. Zavala’s brother, were fighting. After shouting at his brother to stop fighting, Mr. Zavala was shot and seriously injured by one of the participants in the fight. At the time of the incident, defendants Zinser and Harris, City of Detroit police officers, were sitting nearby in their marked police vehicle.
"Plaintiffs sued several of the participants in the fight. They were later granted permission to amend their complaint to add defendants Zinser, Harris, and the City of Detroit. They alleged that defendants Zinser and Harris had been negligent in failing to stop the fight, in failing to stop Mr. Zavala’s assailant from shooting him, and in generally failing to uphold or enforce the law. They alleged a 'special relationship’ between Mr. Zavala and defendant police officers giving rise to a duty of due care toward him. Plaintiffs further alleged the vicarious liability of defendant City of Detroit for the negligent conduct of its employees.
"Defendants Zinser, Harris, and the City of Detroit moved for summary judgment under GCR 1963, 117.2(1). The court ruled that plaintiffs’ claims against defendant city were barred by governmental immunity, and that any duties owed by defendant police officers in this case had been owed to the public generally and not to Mr. Zavala individually. The motion for summary judgment was, therefore, granted.” 123 Mich App 352, 354-355; 333 NW2d 278 (1983).
A majority of the Court of Appeals agreed that if a police officer breaches his duty to preserve the peace, the officer is liable only to the public. Since plaintiffs failed to allege sufficiently that the officers owed some other duty to them in particular, judgment for the officers was affirmed. Judgment for the city was also affirmed on the grounds that the operation of a police department is a governmental function and a claim of intentional tort had not been alleged’ However, the case was remanded for further fact-finding concerning the denial of plaintiffs’ motion to amend their complaint to allege a cause of action under 42 USC 1983.
The dissent maintained that judgment for the officers was improper because they had "a ministerial duty to perform some minimum acts to preserve the peace” pursuant to statute, the city charter, and police department policy. Furthermore, plaintiffs’ allegation of a "special relationship” was sufficient to give rise to a duty of due care and a question of fact as to whether the officers had acted reasonably.
As to the liability of the individual officers, we need not decide the "public/individual” duty issue or whether the "special relationship” allegations were legally sufficient, since we conclude that the officers are entitled to individual immunity from tort liability. Plaintiffs admitted in ¶ 39 of their second amended complaint, and the trial court found during the motion for summary judgment, that the officers were acting during the course of their employment and within the scope of their authority. The only allegations of bad-faith conduct appeared in Count VIII of plaintiffs’ proposed third amended complaint. However, the trial court did not allow plaintiffs to add this count. Thus, the only question remaining is whether the officers’ actions, or lack thereof, in dealing with the fight were discretionary-decisional in nature.
The parties agree that the officers did not sit idly by while the fight occurred. The officers decided not to deal with the disturbance alone and immediately called for backup assistance, which arrived six to ten minutes later. Plaintiffs do not allege that the officers delayed too long in requesting assistance, gave the wrong address, etc. Instead, plaintiffs maintain that the officers did not take the type of action which plaintiffs believe would have been appropriate.
Police officers, especially when faced with a potentially dangerous situation, must be given a wide degree of discretion in determining what type of action will best ensure the safety of the individuals involved and the general public, the cessation of unlawful conduct, and the apprehension of wrongdoers. The determination of what type of action to take, e.g., make an immediate arrest, pursue a suspect, issue a warning, await backup assistance, etc., is a discretionary-decisional act entitled to immunity. Once that decision has been made, however, the execution thereof must be performed in a proper manner, e.g., the arrest must be made without excessive force, the pursuit of the suspect must not be done negligently, the request for assistance must include reasonably accurate information, etc. Since plaintiffs merely alleged negligent performance of a discretionarydecisional act, summary judgment for the individual officers was properly granted.
Plaintiffs’ claim against the city alleges vicarious liability for the officers’ negligence. As previously noted, the officers were acting during the course of their employment and within the scope of their authority. There is no allegation that the city and its employees were engaged in activities conducted primarily for pecuniary profit. Thus, we must determine whether an officer’s decision to request and await backup assistance is expressly or impliedly mandated or authorized by constitution, statute, or other law._
As noted in Trezzi, supra, the city is expressly required by constitution, statute, and city charter to provide for the public peace, health, and safety of persons and property. The Detroit Police Department and its police officers are charged with the responsibility of preserving the public peace and order, preventing crime, and protecting the rights of persons. In order to accomplish these duties, the department necessarily allows its officers to exercise some judgment and discretion as to when, where, and how to act. Thus, the decision to request and await backup assistance is impliedly authorized by constitution, statute, and city charter. Since the injuries arose while the city’s employees were engaged in the exercise or discharge of a governmental function, the city is entitled to governmental immunity from tort liability.
VII. Conclusion
In Ross, the decision of the Court of Appeals is reversed in part.
In Willis, the decision of the Court of Appeals is affirmed.
In Siener, the decision of the Court of Appeals is affirmed.
In Rocco, the decision of the Court of Appeals is affirmed.
In Regulski, the decision of the Court of Appeals is reversed in part.
In Trezzi, the decision of the Court of Appeals is affirmed.
In Disappearing Lakes, the decision of the Court of Appeals is affirmed.
In Zavala, the decision of the Court of Appeals is affirmed.
Williams, C.J., and Ryan, Brickley, Cavanagh, and Boyle, JJ., concurred.
1964 PA 170.
1964 PA 170 was amended by 1970 PA 155 and 1978 PA 141.
Section 1 of the governmental tort liability act contains the following definitions:
"(a) 'Municipal corporation’ means any city, village, township or charter township, or any combination thereof, when acting jointly.
"(b) 'Political subdivision’ means any municipal corporation, county, township, charter township, school district, port district, or metropolitan district, or any combination thereof, when acting jointly, and any district or authority formed by 1 or more political subdivisions.
"(c) 'State’ means the state of Michigan and its agencies, departments, and commissions, and shall include every public university and college of the state, whether established as a constitutional corporation or otherwise.
"(d) 'Governmental agency’ means the state, political subdivisions, and municipal corporations as herein defined.” MCL 691.1401; MSA 3.996(101).
MCL 691.1402; MSA 3.996(102) provides in relevant part:
"Each governmental agency having jurisdiction over any highway shall maintain the highway in reasonable repair so that it is reasonably safe and convenient for public travel. Any person sustaining bodily injury or damage to his property by reason of failure of any governmental agency to keep any highway under its jurisdiction in reasonable repair, and in condition reasonably safe and fit for travel, may recover the damages suffered by him from such governmental agency. The liability, procedure and remedy as to county roads under the jurisdiction of a county road commission shall be as provided in section 21, chapter 4 of Act No. 283 of the Public Acts of 1909, as amended, being section 224.21 of the Compiled Laws of 1948. The duty of the state and the county road commissions to repair and maintain highways, and the liability therefor, shall extend only to the improved portion of the highway designed for vehicular travel and shall not include sidewalks, crosswalks or any other installation outside of the improved portion of the highway designed for vehicular travel.”
MCL 691.1405; MSA 3.996(105) provides:
"Governmental agencies shall be liable for bodily injury and property damage resulting from the negligent operation by any officer, agent, or employee of the governmental agency, of a motor vehicle of which the governmental agency is owner, as defined in Act No. 300 of the Public Acts of 1949, as amended, being sections 257.1 to 257.923 of the Compiled Laws of 1948.
MCL 691.1406; MSA 3.996(106) provides in relevant part:
"Governmental agencies have the obligation to repair and maintain
public buildings under their control when open for use by members of the public. Governmental agencies are liable for bodily injury and property damage resulting from a dangerous or defective condition of a public building if the governmental agency had actual or constructive knowledge of the defect and, for a reasonable time after acquiring knowledge, failed to remedy the condition or to take action reasonably necessary to protect the public against the condition. Knowledge of the dangerous and defective condition of the public building and time to repair the same shall be conclusively presumed when such defect existed so as to be readily apparent to an ordinary observant person for a period of 90 days or longer before the injury took place.”
MCL 691.1413; MSA 3.996(113) provides:
"The immunity of the state shall not apply to actions to recover for bodily injury or property damage arising out of the performance of a proprietary function as herein defined. Proprietary function shall mean any activity which is conducted primarily for the purpose of producing a pecuniary profit for the state, excluding, however, any activity normally supported by taxes or fees. No action shall be brought against the state for injury or property damage arising out of the operation of proprietary function, except for injury or loss suffered on or after July 1, 1965.”
MCL 691.1408; MSA 3.996(108).
See, e.g., Borchard, Governmental Responsibility in Tort, 36 Yale L J 1, 17-41 (1926); 3 Holdsworth, History of English Law (5th ed), pp 458-469; Jaife, Suits Against Government and Officers: Sovereign Immunity, 77 Harv L Rev 1, 3-4, 19-20 (1963); Prosser, Torts (4th ed), § 131, pp 970-971.
In Michigan, the basis for non-sovereign governmental immunity is the state’s common-law sovereign immunity. As the Supreme Court explained in Nicholson v Detroit, 129 Mich 246; 258; 88 NW 695 (1902):
"The true theory is that the township or city represents the State in causing these things to be done, and like the State, it enjoys immunity from responsibility in case of injury to individuals * * * [because, in] imparting a portion of its powers, the State also imparts its own immunity.”
1842 PA 12; 1843 PA 74. See also Const 1850, art 8, § 4; 1851 PA 142; Const 1908, art 6, § 20.
See also People ex rel Dewey v Bd of State Auditors, 32 Mich 191 (1875); People ex rel Gratiot County Treasurer v Auditor General, 38 Mich 746 (1878).
1927 PA 133.
1925 PA 374.
1929 PA 259.
Earlier decisions had also impliedly recognized that injuries occurring as a result of a state agency’s exercise or discharge of a governmental function were not compensable. See, e.g., Ferris v Detroit Bd of Ed, 122 Mich 315; 81 NW 98 (1899); Whitehead v Detroit Bd of Ed, 139 Mich 490; 102 NW 1028 (1905); Daniels v Grand Rapids Bd of Ed, 191 Mich 339; 158 NW 23 (1916); Robinson v Washtenaw Circuit Judge, 228 Mich 225; 199 NW 618 (1924); McDonnell v Brozo, 285 Mich 38 (1938). See also Pound v Garden City School Dist, 372 Mich 499; 127 NW2d 390 (1964); McCann v State of Michigan, 398 Mich 65; 247 NW2d 521 (1976). Although several of these cases involved boards of education, such governmental agencies have traditionally been classified as state agencies for tort liability purposes. Attorney General ex rel Kies v Lowrey, 131 Mich 639, 644; 92 NW 289 (1902), aff'd 199 US 233; 26 S Ct 27; 50 L Ed 167 (1905); Whitehead, supra, p 494; Sayers v School Dist No 1, Fractional, 366 Mich 217, 219; 114 NW2d 191 (1962); Pittman v City of Taylor, 398 Mich 41, 55-59; 247 NW2d 512 (1976) (dissenting opinion of Coleman, J.), and cases cited therein; Bofysil v Dep’t of State Highways, 44 Mich App 118, 125; 205 NW2d 222 (1972).
In Myers v Genesee County Auditor, 375 Mich 1, 9; 133 NW2d 190 (1965), Justice O’Hara concluded that common-law sovereign immunity was absolute except as provided for by statute, i.e., there is no "governmental function” requirement. Not only was this erroneous conclusion dicta (only the governmental immunity of a county hospital was at issue), but the opinion was joined by only one other justice. Furthermore, the opinion failed to cite any supporting authority and did not mention any of the aforementioned cases to the contrary. Finally, this proposition has never been cited in any other decision of this Court and was distinguished twice in the Court of Appeals on the basis of Sayers, supra. See Picard v Greisinger, 2 Mich App 96, 98-99; 138 NW2d 508 (1965); Williams v Primary School Dist #3, Green Twp, 3 Mich App 468, 473; 142 NW2d 894 (1966).
1943 PA 237, § 24 provided:
"Upon the happening of any event subsequent to November 1, 1943, which gives rise to a cause of action, the state hereby waives its immunity from liability for the torts of its officers and employees and consents to have its liability for such torts determined in accordance with the same rules of law as apply to an action in the circuit court against an individual or a corporation, and the state hereby assumes liability for such acts, and jurisdiction is hereby conferred upon the court of claims to hear and determine all claims against the state to recover damages for injuries to property or for personal injury caused by the misfeasance or negligence of the officers or employees of the state while acting as such officer or employee. Such claim must be submitted pursuant to procedural provisions of the court of claims act. The provisions of this act shall not apply to (a) any claim for injury to or death of a prisoner, or for services rendered while an inmate of a penal institution; (b) any claim arising out of the injury to or death of an inmate of any state institution in connection with the rendition of medical or surgical treatment; (c) any claim for property damage or personal injury caused by the Michigan state troops and/ or the national guard when called into the service of the state.”
1945 PA 87 provided:
"AN ACT to abolish the defense of governmental function in certain actions brought against the state of Michigan; and to repeal section 24 of Act No. 135 of the Public Acts of 1939, as amended by Act No. 237 of the Public Acts of 1943.
"Section 1. In all actions brought in the court of claims against the state of Michigan to recover damages resulting from the negligent operation by an officer, agent or employee of the state of Michigan of a motor vehicle of which the state of Michigan is owner as defined by Act No. 302 of the Public Acts of 1915, as amended, the fact that the state of Michigan was in the ownership or operation of such motor vehicle, engaged in a governmental function, shall not be a defense to such action: Provided, however, That this act shall not be construed to impose upon other owners of motor vehicles by the provisions of Act No. 302 of the Public Acts of 1915, as amended.
"Section 2. Section 24 of Act No. 135 of the Public Acts of 1939, as amended by Act No. 237 of the Public Acts of 1943, is hereby repealed.”
The McDowell Court wrote:
" 'The legislature has received, considered, and acted upon such recommendations in the past, as is demonstrated by the enactment of PA 1943, No 237, and by the enactment of PA 1945, No 87. By these acts the defense of sovereign immunity was first abolished and then restored except as to causes of action based upon negligent operation of State-owned motor vehicles. * * * However, the doctrine of sovereign immunity which presently exists in Michigan is not the archaic, obsolete, "king can do no wrong” edition of 1066, but consists of a pattern of deliberate legislative choices which achieved its present form, so far as the State itself is concerned, by the enactment of PA 1945, No 87, and the amendment thereof by PA 1960, No 33. * * * [T]he fact that the legislature amends a statute in 1960 does show that the legislature is giving continuing consideration to, and acting with respect to, the doctrine of sovereign immunity. If the express re-establishments of the doctrine of sovereign immunity by the legislature in 1945 is obsolete, illogical, harsh, cruel, et cetera, then the legislature should be called upon to modify or abolish the doctrine.
" 'So far as the State itself is concerned, the doctrine of sovereign immunity as it presently exists in Michigan is a creature of the legislature. The doctrine has been modified by the legislature, abolished by the legislature, re-established by the legislature, and further modified by the legislature.’
"The judiciary has no right or power to repeal statutes. * * * [T]he legislature has willed that the present defendants be and remain immune from liability for torts such as these plaintiffs have alleged. There they must stand, legally, until the legislature wills to the contrary.” McDowell, supra, 365 Mich 270-271.
See also Sayers, supra; Lewis v Genesee County, 370 Mich 110; 121 NW2d 417 (1963).
The common-law governmental immunity of counties, townships, and villages was abolished in Myers v Genesee County Auditor, 375 Mich 1; 133 NW2d 190 (1965), and Keenan v County of Midland, 377 Mich 57; 138 NW2d 759 (1966).-
City Attorney Allen G. Hertler of Royal Oak, Michigan, a member of the special committee that drafted the governmental immunity act, stated:
"In lobbying for this legislation, its proponents traded heavily on the paradoxical state of existing law which found the State and its agencies, including school districts, still enjoying the defense of governmental immunity, while municipal corporations could no longer employ this defense. We sought to achieve legislation that would put all government on the same basis. * * * This statute puts all agencies of government on the same footing with regard to tort liability.” Abels, Report of Committee on Tort Liability, 28 NIMLO Municipal L Rev 432, 463-464 (1965).
Section 7 was found unconstitutional because it granted immunity from all tort liability. In contrast, the title of the governmental immunity act created immunity for injuries caused by negligence alone. Since negligence is only one species of tort, § 7 unconstitutionally conferred much broader immunity than the title allowed. Section 7 was deemed independent from the remainder of the act and was severed. Maki, supra, 385 Mich 158-159.
To cure the constitutional defect, the Legislature merely omitted the reference to negligence in the act’s title. See 1970 PA 155, § 1. The changes in § 7 were merely stylistic.
In determining that this Court had the authority to abolish common-law sovereign immunity, the lead opinion stated:
"In reaching this result we reexamined the case of McDowell v State Highway Commissioner, 365 Mich 268; 112 NW2d 491 (1961). In McDowell, the majority of the Court concluded that 1945 PA 87 granted statutory tort immunity to the state.' This conclusion, we believe, was erroneous. The Legislature in 1945 PA 87 did not statutorily grant to the state governmental tort immunity. Rather, it repealed the statutory waiver of immunity found in 1943 PA 237 and returned the state to the common-law immunity it had enjoyed prior to the 1943 amendment. This conclusion was correctly explained by Justice Edwards dissenting in McDowell:
" 'By this statute [1945 PA 87], the legislature repealed PA 1939, No 135, § 24, as amended by PA 1943, No 237, the amendment being a legislative grant of the right of maintaining tort actions against the State. By enactment of this statute, the legislature moved to abolish the judicial doctrine of governmental immunity. By repealing this statute, the legislature returned to its prior posture which was no statutory provision on the subject whatsoever.’ ” Pittman, supra, 398 Mich 46-47, fn 1.
Cf. fn 18, supra.
The majority believed that the reasons given in Williams for abolishing common-law governmental immunity for municipalities were equally applicable to sovereign immunity. In addition, there was no good reason to treat state and non-sovereign governmental units differently. Id., p 48. Pittman, however, has limited applicability. Only those cases pending or filed as of November 23, 1976, involving causes of action arising before August 1, 1970 (the date § 7 became effective), could take advantage of the demise of common-law sovereign immunity.
The majority reasoned that words and phrases which have acquired a common-law meaning are interpreted in the same manner when used in statutes dealing with the same subject matter. The Legislature, in using the term "governmental function” to describe the limits of governmental immunity, intended that activities which were considered governmental functions when the statute was enacted should also enjoy statutory immunity. This conclusion was bolstered by the second sentence of § 7, which affirmed the case law precedent concerning sovereign immunity.
Subsequent decisions of this Court did not overrule Parker on this point. In Perry v Kalamazoo State Hospital, 404 Mich 205; 273 NW2d 421 (1978), which was decided the same day as Parker, Justice Ryan, joined by Justices Williams and Coleman, again expressed their view that the phrase "governmental function” must be defined by common-law precedent. Id., pp 210-212. Justice Moody briefly mentioned his contrary view in his concurrence, id., p 215, but the remaining three members of the Court did not. However, since these same four justices had espoused the "anti-freeze” position in Parker, it is clear that they intended the same result in Perry.
In Ross v Consumers Power Co, 415 Mich 1; 327 NW2d 293 (1982), Justices Ryan, Williams, and Coleman again expressed their views. Id., pp 14-15. Justice Kavanagh’s opinion, joined by Chief Justice Fitzgerald and Justice Levin, did not mention the issue, but there is no indication that they had abandoned their prior views. The late Justice Moody took no part in the decision. Thus, Parker was affirmed on this point because of the 3-3 decision.
See Cooperrider, The Court, The Legislature, and Governmental Tort Liability in Michigan, 72 Mich L Rev 187, 229-237 (1973), and cases discussed therein.
See Cooperrider, supra, pp 219-229 and cases discussed therein. The "common good of all” test has been recently reaffirmed by several members of this Court as the sole definition of "governmental function.” See Tilford v Wayne County General Hospital, 403 Mich 293, 301-302; 269 NW2d 153 (1978) (Ryan, J., concurring); Parker, supra, p 191, fn 3 (opinion of Fitzgerald, J.), and pp 203-204 (Ryan, J., dissenting); Perry, supra, pp 211-212; Bush v Oscoda Area Schools, 405 Mich 716, 735, fn 2; 275 NW2d 268 (1979) (Ryan, J., dissenting); Ross, supra, pp 6-8 (opinion of Ryan, J.).
Sovereign and governmental immunity from tort liability has also been denied at common law where the governmental agency created certain types of trespasses or nuisances. See Cooperrider, supra, pp 238-249, and cases discussed therein. See also Rosario v City of Lansing, 403 Mich 124; 268 NW2d 230 (1978), and Gerzeski v Dep’t of State Highways, 403 Mich 149; 268 NW2d 525 (1978), for a thorough discussion of the different types of nuisances and trespasses. In light of our resolution of Disappearing Lakes, infra, we need not determine at this time whether this exception remains viable.
The Thomas dissent wrote:
"The test then, of 'governmental function’ for purposes of the immunity statute, must be phrased in terms of the nature of the specific function. We conclude that a function is not 'governmental’ in this context unless the particular activity that this function entails is uniquely associated with those activities having 'no common analogy in the private sector because they reflect the imperative element in government, the implementation of this right and duty to govern.’ Thus, a government is immune only when it is planning and carrying out duties which, due to their peculiar nature, can only be done by a government. The mere fact that a governmental agency is doing a certain act does not make such act a 'governmental function’ if a private person or corporation may undertake the same act. Thus, 'governmental function’ is not delineated by questions of the broad scope of an activity undertaken or by financial or insurance considerations which may be indicative of a governmental undertaking, but rather by viewing the precise action allegedly giving rise to liability, and determining whether such action is sui generis governmental — of essence to governing. * * * [Cjertain aspects of the exercise of the executive, legislative, or judicial powers are by their very nature governmental functions and necessarily removed from the undertakings of the private sector. * * *
"The parameter of 'governmental function’ will most often run along the line of distinction between decisional and planning aspects of governmental duties on the one hand, and operational aspects on the other.” Thomas, supra, pp 21-22.
See also Parker, supra, p 193 (opinion of Fitzgerald, J.); Perry, supra, p 215 (Kavanagh, C.J., dissenting).
Even if the activity in question did not meet this test, the governmental agency could still be found immune from tort liability if such liability "would be an unacceptable interference with government’s ability to govern * * Parker, supra, p 200. See also Perry, supra, p 214.
Const 1835, art 1, § 2; Const 1908, art 2, § 1; Const 1963, art 1, § 1.
See Cooperrider, supra, pp 229-237, and cases discussed therein.
Such an interpretation satisfies the recurring concern that the proprietary/governmental function dichotomy rests on a false premise, i.e., if an activity does not fall into the first category, it necessarily falls into the latter. See Cooperrider, supra, p 282; Parker, supra, p 193, and fn 8 (opinion of Fitzgerald, J.); McCann, supra, 398 Mich 79 (opinion of Ryan, J.); Thomas, supra, 398 Mich 19 (Kavanagh, C.J., and Fitzgerald, J., dissenting).
The dissent states that under today’s decision, a governmental entity can expand the scope of its immunity by promulgating an ordinance or other law. If the activities in which the governmental agency was engaged when the tort was committed were not expressly or impliedly mandated or authorized by constitution, statute, or other law (i.e., the activities were ultra vires), it cannot thereafter pass a law which would retroactively authorize the activities. The possibility that governmental agencies will now enact laws requiring or authorizing activities merely to immunize themselves against future unknown tort liability is remote. The suggestion of such devious motivation is unwarranted.
In Galli v Kirkeby, 398 Mich 527, 532, 540-541; 248 NW2d 149 (1976), four members of this Court held that plaintiffs must plead facts in their complaint in avoidance of immunity, i.e., they must allege facts which would justify a finding that the alleged tort does not fall within the concept of sovereign or governmental immunity. This may be accomplished by stating a claim which fits within one of the statutory exceptions or pleading facts which demonstrate that the tort occurred during the exercise or discharge of a non-governmental or proprietary function. See McCann, supra, p 77 (opinion of Ryan, J.). Sovereign and governmental immunity are not affirmative defenses, but characteristics of government which prevent imposition of tort liability upon the governmental agency. Galli, supra, p 541, fn 5; McCann, supra, p 77, fn 1.
Of course, a governmental agency can only "act” through its officers, employees, and agents. As with corporate entities, however, some acts are deemed to be done by the agency itself, rather than by an individual.
MCL 691.1408; MSA 3.996(108), as amended, provides:
"(1) Whenever a claim is made or a civil action is commenced against an officer or employee of a governmental agency for injuries to persons or property caused by negligence of the officer or employee while in the course of employment and while acting within the scope of his or her authority, the governmental agency may pay for, engage, or furnish the services of an attorney to advise the officer or employee as to the claim and to appear for and represent the officer or employee in the action. The governmental agency may compromise, settle, and pay the claim before or after the commencement of a civil action. Whenever a judgment for damages is awarded against an officer or employee of a governmental agency as a result of a civil action for personal injuries or property damage caused by the officer or employee while in the course of employment and while acting within the scope of his or her authority, the governmental agency may idemnify [sic] the officer or employee or pay, settle, or compromise the judgment.
"(2) When a criminal action is commenced against an officer or employee of a governmental agency based upon the conduct of the officer or employee in the course of employment, if the employee or officer had a reasonable basis for believing that he or she was acting within the scope of his or her authority at the time of the alleged conduct, the governmental agency may pay for, engage, or furnish the services of an attorney to advise the officer or employee as to the action, and to appear for and represent the officer or employee in the action. An officer or employee who has incurred legal expenses after December 31, 1975 for conduct prescribed in this subsection may obtain reimbursement for those expenses under this subsection.
"(3) This section shall not impose any liability on a governmental agency.”
MCL 691.1409; MSA 3.996(109) provides:
"The purchase of liability insurance to indemnify and protect governmental agencies against loss or to protect governmental agencies and some or all of its agents, officers, and employees against loss on account of any judgment secured against it, or them, arising out of any claim for personal injury or property damage caused by such governmental agency, its officers, or employees, is authorized, and all governmental agencies are authorized to pay premiums for the insurance out of current funds. The existence of any policy of insurance indemnifying any governmental agency against liability for damages is not a waiver of any defense otherwise available to the governmental agency in the defense of the claim.”
The existence of a tort, the individual tortfeasor’s status as an employee, agent, independent contractor, etc., the question whether the tortfeasor was acting during the course of employment and within the scope of authority, and the corresponding extent of the governmental agency’s vicarious tort liability will generally be determined with reference to common-law tort and agency principles.
Other decisions which have followed this rule include Gordon v Farrar, 2 Doug 411 (Mich, 1847); Raynsford v Phelps, 43 Mich 342, 344-345; 5 NW 403 (1880); Amperse v Winslow, 75 Mich 234, 244-245; 42 NW 823 (1889); Pawlowski v Jenks, 115 Mich 275, 276-277; 73 NW 238 (1897); Nicholson v Detroit, 129 Mich 246, 255; 88 NW 695 (1902); Stevens v Black, 212 Mich 281, 292; 180 NW 503 (1920); People v O’Connell, 214 Mich 410, 414-415; 183 NW 195 (1921); Sherbutte v Marine City, 374 Mich 48, 54; 130 NW2d 920 (1964). See also Little-john & DeMars, Governmental Immunity After Parker and Perry: The King Can Do Some Wrong, 1982 Det C L Rev 1, 34-35.
"* 'Government officials are liable for the negligent performance of their ministerial duties * * * but are not liable for their discretionary acts within the scope of their authority, * * * even if it is alleged that they acted maliciously. * * * Such immunity is not designed to protect the guilty, for "if it were possible in practice to confine such complaints to the guilty, it would be monstrous to deny recovery. The justification for doing so is that it is impossible to know whether the claim is well founded until the case has been tried, and that to submit all officials, the innocent as well as the guilty, to the burden of a trial and to the inevitable danger of its outcome, would dampen the ardor of all but the most resolute, or the most irresponsible, in the unflinching discharge of their duties. * * * In this instance it has been thought in the end better to leave unredressed the wrongs done by dishonest officers than to subject those who try to do their duty to the constant dread of retaliation.” Learned Hand, J., in Gregoire v Biddle, 177 F2d 579, 581 [CA 2,1949].’ Muskopf v Corning Hospital District, 55 Cal 2d 211, 220, 221 (11 Cal Rptr 89, 94, 95, 359 P2d 457 [1961]).”
See, e.g., Littlejohn & DeMars, supra, pp 37-38.
The requirement that the individual act, or reasonably believe he is acting, within the scope of his authority satisfies the concern of some commentators who believe that an individual should not be held liable merely because it is later determined that he acted under an unconstitutional statute or otherwise had no actual authority. As Dean Prosser has noted, an officer’s decision as to how, when, or where to act necessarily involves a discretionary or judicial determination that he has the authority to so act. Prosser, supra, § 132, p 991. This reasoning was impliedly used in Wall v Trumbull, 16 Mich 228, 237-238 (1867), where it was stated that the township board had jurisdiction to determine whether a claim was lawful and to act accordingly.
The requirement that the individual act during the course of his employment and within the scope of his authority parallels the language of § 8, which authorizes a governmental agency to defend and indemnify its officers and employees.
See Prosser, supra, p 991, and authorities cited therein.
See Littlejohn & DeMars, supra, p 26.
See Prosser, supra, p 990, quoting Ham v Los Angeles County, 46 Cal App 148, 162; 189 P 462 (1920).
Plaintiff alleged claims bhsed on negligence, gross negligence, wilful, wanton and reckless conduct, breach of fiduciary duty, and breach of implied contract. As to the latter two claims, the circuit court found that the complaint did not state additional significant facts which would establish a fiduciary relationship or the terms of any contract. Plaintiff was merely attempting to avoid governmental immunity. The Court of Claims did not discuss these counts separately. Since plaintiff did not specifically challenge the circuit court’s conclusion in either the Court of Appeals or this Court, we need not determine whether summary judgment was properly granted for defendants as to these two counts.
MCL 330.1722; MSA 14.800(722) provides:
"(1) A recipient of mental health services shall not be physically, sexually, or otherwise abused.
"(2) The governing body of each facility shall adopt written policies and procedures designed to protect recipients of mental health services from abuse and to prevent the repetition of acts of abuse. The policies and procedures shall more particularly define abuse, shall provide a mechanism for discovering instances of abuse and for reviewing all charges of abuse, shall ensure that firm and appropriate disciplinary action is taken against those who have engaged in abuse, and shall contain those additional provisions deemed appropriate by the governing body.
"(3) A facility shall cooperate in the prosecution of appropriate criminal charges against those who have engaged in unlawful abuse.
"(4) Any recipient of mental health services physically, sexually, or otherwise abused shall have a right to pursue injunctive and other appropriate civil relief.”
The dissent notes that the district may have violated § 1288 of the School Code by not requiring each student to wear eye protective devices during the class. Since plaintiff has never alleged or argued that he is entitled to relief because of this statutory violation, we need not determine whether § 1288 authorizes the recovery of damages from a school district in spite of § 7 of the governmental immunity act.
We assume that plaintiffs’ cause of action accrued after August 1, 1970, the effective date of § 7 of the governmental immunity act. Plaintiffs have never alleged that the holding of Pittman v Taylor is applicable to the facts of this case. See fn 23 and accompanying text.
Since the relevant statutory provisions of both acts are sufficiently similar for purposes of this discussion, only current statutory provisions will be cited.
Plaintiffs alleged in Count VIII that the officers failed to stop the fight on account of Jose Zavala’s race and gender. Zavala is a Mexican-American male. Both officers are female; one is black and the other white.
In Sherbutte v Marine City, 374 Mich 48, 54-55; 130 NW2d 920 (1964), plaintiff brought an action against a police officer for allegedly using excessive force in effectuating his arrest. This Court reversed summary judgment for the officer, stating:
"Appellee’s theory is that because Williams excluded 'discretionary’ acts, and that since a police officer has discretion as to whom he will arrest, for what reason the arrest will be made, and how much force will be used, his action is a 'discretionary’ one. The theory is untenable.
"The action of a police officer in making an arrest cannot be considered within the broad scope of the discretion allowed a free government in its legislative, executive, or judicial branch.”
This holding is not necessarily in conflict with our decision today. In Sherbutte, plaintiff did not allege that the officer’s decision to arrest him was improper, but that the officer had effectuated the arrest in a tortious manner. Unlike the instant case, plaintiff there properly alleged the negligent performance of a ministerial-operational activity for which there is no immunity from tort liability. | [
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Graves, C. J.
In the winter of 1880 certain proceedings were taken to erect a new school-district out of territory then belonging to district No. 3 of Everett, and the board of school inspectors carried out the scheme and identified the new district as No. 7. They further ascertained and decided that there was justly due to said new district from the residue of the old one the sum of $1679.32, as its proportion 'of the value of the school-house and other property of the former district. Subsequently the board of supervisors erected the township of Wilcox from territory belonging to said township of Everett, and the new school-district was included, and was afterwards identified as district No. 1 of Wilcox.
At the October term for 1881 the relator applied for a mandamus to require the clerk of the township of Everett to certify to the supervisor the amount liquidated as aforesaid by the board of school inspectors as due to the new district from the old one. The petition set forth the proceedings in general terms, and alleged that the clerk had refused to certify to the supervisor. The usual order to show cause was allowed, and the respondent subsequently filed a sworn answer. It was manifestly evasive, but out of deference to the public interests connected with the case the Court was induced to prescribe a finding on such questions as the papers indicated to be of any importance in this inquiry, and at the April term for 1881 they were sent down for trial. They were afterwards determined by a jury, and the answer to each proposition was adverse to the contention by respondent.
The case is now before us on the order to show cause. Abundant opportunity has been given, but no showing of the least importance is made. The application stands substantially undefended. No brief is furnished for the respondent, and no one answers for him. And relator’s counsel suggests that it is his understanding that the respondent intends to go no further.
Under these circumstances greater delay would not be excusable. The application seems to be prima facie sufficient, and the failure to show any cause against it after so much time and opportunity is very near to a confession of its propriety.
The peremptory writ must issue.
The other Justices concurred. | [
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Kavanagh, J.
This is an appeal from a decision of the Court of Appeals reversing a summary judgment for plaintiff.
Richard Widling and Sylvia Todd lived in the same household. Defendant Widling was involved in an automobile collision while operating a car owned by Todd. Todd, who was a passenger in her vehicle, suffered personal injuries as a result of the accident, for which she filed suit for damages against Widling.
This action commenced when plaintiff Detroit Automobile Inter-Insurance Exchange (DAIIE) filed a complaint for a declaratory judgment against the defendant. The complaint asserted that although defendant was a named insured under an automobile policy issued by plaintiff, plaintiff was not liable under the terms of the policy for any damages Todd might recover against defendant on account of the accident.
Defendant moved for summary judgment of dismissal under GCR 1963, 117.2(1) (failure to state a claim upon which relief may be granted) on the basis that the "non-owned automobile” exclusion upon which plaintiff relied to avoid liability, was void under the Court of Appeals decision in State Farm Mutual Automobile Ins Co v Ruuska, 90 Mich App 767; 282 NW2d 472 (1979). Plaintiff opposed the motion for summary judgment, maintaining the vehicle owned by Todd and operated by defendant is excluded from coverage under the terms of the policy and that the excluding provision is not void.
The trial court denied defendant’s motion for summary judgment and sua sponte granted plain tiff summary judgment under GCR 1963, 117.3 (no genuine issue of material fact in dispute and plaintiff entitled to judgment as a matter of law), holding the "non-owned automobile” exception valid and applicable to this case.
The Court of Appeals reversed, finding that this Court’s decision in State Farm Mutual Automobile Ins Co v Ruuska, 412 Mich 321; 314 NW2d 184 (1982), held that such "non-owned automobile” exceptions were unenforceable.
We granted leave to consider whether such clauses should be held absolutely void.
When we first considered this question in Ruuska, three justices were of the opinion that such clauses were violative of the no-fault automobile liability act, MCL 500.3101 et seq.; MSA 24.13101 et seq., and therefore absolutely void and unenforceable. 412 Mich 334-337 (Williams, J.). One justice concluded:
"An insurer is not required by the no-fault act to provide portable coverage when the owner drives another insured vehicle.
"8 Other provisions and policies of the act are implicated where a person insured or covered by a no-fault policy drives an uninsured vehicle. No opinion is intimated in that regard.” | [
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Campbell, J.
Plaintiff sued defendant for injury to a steam threshing engine, caused by the breaking down of part of a bridge over which it was passing. The jury found for defendant, and plaintiff complains of error in the rulings.
The whole circumstances resemble very closely, even to the details of the accident, those which were presented in Perkins v. Medina 48 Mich. 67. Several of the questions are mere repetitions of those raised in that case, and the court below so considered them, and decided in accordance with the views there expressed. We need not, therefore, go further than to examine how far questions arose not already thus disposed of, and in our view the differences are" not material.
In order to recover it became necessary for plaintiff to show, not only damage from defects in the bridge, but fault in defendant in having a bridge in such condition ; and such fault could only exist where there had been failure to repair injuries which defendant either knew, or had such notice of as should have led to the removal of the mischief. This involved questions of fact for the jury-under proper instructions, and inasmuch as the instructions given were in accordance with our own rulings, and left all facts fairly to the jury, there was nothing to complain of on this head, unless, as plaintiff’s counsel distinctly claimed on the argument, townships should be held liable ■ at all events as insurers, and not merely for neglect of duty. There is no authority, under the statute or otherwise, for any such extreme view; and we do not see how the various questions could properly have been taken from the jury, as plaintiff claimed they should have been.
Objection is made that the court erred in excluding evidence of a settlement made by defendant with one Bell, who was injured at the same time and who had charge of the engine when it fell. But inasmuch as plaintiff was a stranger to that transaction it could have no bearing on this controversy. A compromise with one person is in no sense legally an admission of any liability to some one else.
The court admitted full testimony concerning the exact condition of the bridge at the time of and after the accident. Among this proof was testimony showing that chains and other appliances were fixed upon various parts of the bridge. Plaintiff then proposed to ask witnesses why these chains were used, but this was held irrelevant. This ruling was correct. The fact that after the accident precautions were taken does not indicate that any knowledge of the propriety of such precautions was had before the accident. Proof was not excluded of the real condition of the bridge, and the jury had means of understanding that and all its appearances.
Neither was it material to know what new methods have been found desirable in bridge building, unless it is shown that these methods were such that defendant was at fault for npt knowing and using them before. But it is questionable whether any point of this kind falls within any of the assignments of error, and we need spend no time upon it, as no offer was made to show any specific fault of this nature beyond what was fully covered by the general instructions on the case as presented.
A point was made upon certain rulings' which allowed the jury to consider whether the weight of the engine in question, with its accompaniments, was such as might reasonably be anticipated as likely to be placed on the bridge when it was built, and whether any such use should have been reasonably anticipated when the authorities planned it and provided for its completion.
It is claimed by plaintiff that inasmuch as the engine might lawfully be used on the highways, it was the duty of the township to have its bridges built and equipped so as to accommodate it.
There is some plausibility in this claim, but it goes further than the law will warrant. It has always been held that there is necessarily room for some discretion in determining what plans shall be adopted for public ways and their surroundings. There never was, and there is not now, any legal obligation on municipalities to build bridges where no bridges ever stood before, except under conditions and restrictions recognized by law or by the Constitution. The amount of money which can be raised to aid townships in building bridges which they cannot afford to build without aid is limited by the Constitution. Previous to the law of 1879 the limit was also fixed for money to be raised either for building or repairing. While, possibly, it was necessary that every bridge undertaken should be rear sonably fitted and entirely safe, as far as could be secured, for such uses as it was apparently or really designed to subserve, yet it does not follow that every bridge must be adapted for all possible purposes. If a foot bridge could be afforded and a bridge for all traffic could not be afforded, it would be hard to say that the town must build the larger bridge or have none at all. And on the same principle it is reasonable to hold that in determining to build a bridge for general uses, it cannot be expected that the designers will anticipate uses which have not been known, and necessities which are not within ordinary experience. It cannot be a legal wrong to build according to tbe light of the- times when the building is done. The law of 1879 [How. St. §§ 1442-6] does not require changes to be made in the plan of existing bridges. When it requires repairs it may fairly be construed as requiring bridges to be put in as good a condition of strength and soundness as would make them as secure as new bridges of the same kind and plan. But it does not require a different structure.
In this case there was testimony showing that from its peculiar position with steep approaches, there was no likelihood that very heavy loads could be placed on it without the use of extra teams, which it could not be supposed would be used. It also was shown that up to this time the bridge had been safely crossed for several years, and up to the day of the accident by the heaviest loads drawn over the road, exceeding in some recent instances any ordinary burdens. . It was not improper for the jury to consider all these things in determining how far the town was at fault in not planning a heavier structure. ' We notice no other points which are not, in our opinion, within the spirit of Perkins v. Medina.
The judgment must be affirmed with costs.
The other-Justices concurred. | [
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Cooley, C. J.
The facts out of which this litigation arises appear in the opinion of the Court in Beekman v. Fletcher 48 Mich. 156. In the year 1881 John G-. Beekman, assignee of the Alpena Lumber Company, filed his bill in the circuit court for the county of Alpena in chancery to restrain Fletcher from interfering with or taking legal or other measures to get possession of certain logs, the ownership of which was in dispute between them. The bill showed that the controversy respecting the logs was involved in another suit in equity to which Beekman and Fletcher were parties, and it prayed no other relief than' an injunction and the appointment off a receiver for the logs, to abide the result of the principal litigation.
In that injunction suit Maltz was appointed receiver by consent of the parties ; and was authorized to sell the logs and hold the proceeds subject to the order of the court. This Court was of opinion that there was no equitable ground on which the injunction suit could be maintained, and the bill was directed to be dismissed. As to the receiver it was said in the opinion that he “ got his appointment and all his powers from the consent of the parties and became their baileeand there will be no difficulty in reaching a disposition of the funds when the parties have settled their rights ; which could not be done in this suit.” The present suit is brought on promissory notes given by Fletcher to Maltz. The defense which Fletcher undertook to make was that the notes were given for the logs of which Maltz was receiver, and. which he allowed Fletcher to take at a price agreed upon ; that it was understood when the notes were given that they were only to be paid if the logs should be adjudged not to belong to Fletcher, and that they were Fletcher’s in fact. The circuit judge was of opinion that this defense could not be made, because it would be in effect permitting an oral understanding to control the written contract of the parties.
¥e are of opinion that this is not the proper view to take of the case. .The suit in which Maltz was appointed receiver was disposed of, leaving him mere bailee in respect to the logs or their proceeds. He was not an officer of the court, and could only be called to account by the parties in individual suits. His bailment was for the party entitled in fact; in other words for the real owner. The intent of the parties that he should account under the order of the court was defeated when it was decided that there was mr case of equitable cognizance; for that determined that there was no pending case in which he could be called to account. If, therefore, Fletcher was in fact, as he offered to show, the owner of these logs, the bailment was for him, and any notes he had given for the logs, and which depended for their consideration upon the pendency of the suit, were without consideration when the suit was disposed of without a decision upon the merits of the controversy between the parties. It is always competent to show that a contract sued irpon is without consideration. And no rule or policy of the law is violated by allowing proof to be made of the purpose for which negotiable paper was given : or that the purpose does not require that payment should be enforced. Colman v. Post 10 Mich. 422; Catlin v. Birchard 13 Mich. 110; Bowker v. Johnson 17 Mich. 46.
Counsel for the plaintiff very justly say that this conclusion imposes very serious hardship upon Maltz, who, having consented to act for the parties, and having no personal interest in the controversy, is compelled to determine at his peril whom he will recognize as owner. Common fairness to him seems to require that the parties should come to some understanding whereby they may relieve him from this embarrassment; but the Court is powerless in the premises.
A new trial must be ordered.
The other Justices concurred. | [
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] |
Ryan, J.
On March 19, 1981, nine plaintiffs, claiming to be representatives of a class of 524 landowners, filed a petition in the Tax Tribunal alleging that a special assessment imposed on their properties for the purpose of paving the streets abutting their properties was unconstitutional because the value of their properties would not be enhanced by the asphalt paving. On April 20, 1981, the defendant moved to dismiss the plaintiffs’ petition on the ground that the Tax Tribunal lacked jurisdiction over the subject matter of the petition by reason of the operation of the 30-day limitation found in MCL 205.735(2); MSA 7.650(35)(2). That statute provided:
"The jurisdiction of the tribunal shall be invoked by the filing of a written petition by a party in interest, as petitioner, within 30 days after the final decision, ruling, determination, or order which he seeks to review or within 30 days after the receipt of a bill for a tax he seeks to contest. The unit of government shall be named as respondent. Service of the petition on the respondent shall be by certified mail.”
The "final decision, ruling, determination or order” of which the petitioners seek review in the Tax Tribunal is the "confirmation” of the special assessment rolls for the several paving districts in which the plaintiffs are interested. Plaintiffs did not file their petition in the Tax Tribunal, thus invoking its jurisdiction, until March 19, 1981, 195 days after the last final confirmation of the assessment rolls involved in this case.
Defendant’s motion was accompanied by the affidavit of defendant’s city clerk which stated that the special assessment rolls were not finally confirmed until after notice of the several assessments were published, posted, and sent by first-class mail to all affected property owners pursuant to the Westland City Code, and after public hearings regarding the assessments were conducted.
On May 13, 1981, the plaintiffs responded to the defendant’s motion by conceding that their petition was not filed in the Tax Tribunal within 30 days after the final confirmation of the assessments, as required by MCL 205.735(2); MSA 7.650(35)(2), but maintained that the Tax Tribunal nevertheless should take jurisdiction of the matter because it was the plaintiffs’ claim that the assessments constituted an unconstitutional taking of their property without just compensation. The Tax Tribunal, concluding that the 30-day requirement of MCL 205.735(2); MSA 7.650(35)(2) is a limitation upon its jurisdiction to entertain the plaintiffs’ petition, granted defendant’s motion to dismiss. On appeal, the Court of Appeals granted the defendant’s motion to affirm.
Before this Court, the plaintiffs continue to argue that the 30-day rule found in MCL 205.735(2); MSA 7.650(35X2) is not applicable to them because of the soundness of their claim on the merits. Of course, simply because the plaintiffs’ underlying claim has a constitutional dimension, and may even be meritorious, it does not excuse the plaintiffs’ failure to assert their claim within the applicable statutory period of limitation. See Price Paper Corp v Detroit, 42 Mich App 488, 491; 202 NW2d 523 (1972).
In Wikman v Novi, 413 Mich 617, 651; 322 NW2d 103 (1982), this Court reviewed § 35 of the Tax Tribunal Act, concluding that the 30-day filing limit of that section is not necessarily controlling in every case. We stated:
"Although MCL 205.735; MSA 7.650(35) provides that the tribunal’s jurisdiction shall be invoked hy a timely filing, the statute does not state the consequences of failing to file a timely petition. It does not contain any language prohibiting the tribunal from exercising jurisdiction in cases filed later than 30 days after a final ruling or receipt of a tax bill. It contains none of the prohibitive language normally present in statutory limitations. In this respect, MCL 205.735; MSA 7.650(35) is not free from ambiguity.”
We went on to hold that the 30-day limit applies only when "a specific provision providing a longer period of limitation does not exist.” Wikman, supra, p 653.
The plaintiffs have pointed to no provision containing a longer period of limitations than that found in the Tax Tribunal Act. The Westland City Charter, § 14.11, provides:
"Except and unless notice is given to the Council in writing of an intention to contest or enjoin the collection of any special assessment for the construction of any pavement, sewer, or other public improvement, the construction of any sidewalk, or the removal or abatement of any public hazard or nuisance, within thirty (30) days after the date of the meeting of the Council at which it is finally determined to proceed with the making of the improvement in question, which notice shall state the grounds on which the proceedings are to be contested, no suit or action of any kind shall be instituted or maintained for the purpose of contesting or enjoining the collection of such special assessments.”
Section 29-192 of the Westland Ordinance Code is identical to the above charter provision._
Since the plaintiffs have failed to file a petition with the Tax Tribunal within the 30-day period provided by the Tax Tribunal Act, and since they point to no other applicable provision granting them a longer period of time to do so, we conclude, on the basis of the plain language of § 35 and the rule announced in Wikman, that the Tax Tribunal was without jurisdiction to consider the plaintiffs’ petition and therefore correctly dismissed it.
Affirmed.
Williams, C.J., and Brickley, Cavanagh, and Boyle, JJ., concurred with Ryan, J.
This provision has since been modified by 1983 PA 163.
In Wikman, the specifically applicable longer period of limitation was 60 days as provided in the Charter of the City of Novi, § 11.4, and the Novi City Ordinance, No. 69-01, § 26.01.
It should be noted that the plaintiffs do not challenge the adequacies of the notices they received. | [
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Brickley, J.
This is an appeal of a products liability action arising out of a work-related injury. In addition to her pursuit of workers’ compensation benefits from her employer, plaintiff filed this suit against the manufacturer of the machine on which she was injured.
This case poses three distinct questions for our consideration. The first is whether the courts below erred in denying defendant E. W. Bliss’ motion for a directed verdict premised on the assertion that plaintiff had failed to present sufficient evi dence to demonstrate the existence of a prima facie case of negligence due to a failure to warn. The second issue is whether evidence of warning labels, installed on defendants’ presses manufactured after the date of sale of this press, but before the date of the plaintiffs injury, should have been excluded under MRE 407 or MCL 600.2946(3); MSA 27A.2946(3). The third issue involves three related questions: whether it was proper for the jury to be allowed to apply comparative negligence principles and apportion the fault between the defendant and the employer, who was not a party to the suit; whether the employer could be added as a party after the verdict had been rendered; and whether it is permissible under MCL 418.827(5); MSA 17.237(827X5), to reduce the employer’s workers’ compensation lien by the amount determined by the jury to be reflective of the employer’s responsibility for plaintiffs injuries.
We agree with the Court of Appeals on the first and third issues; however, we disagree with the reasoning and result of the Court of Appeals on the second issue. Defendant Bliss’ motion for directed verdict on the failure to warn count was correctly denied. However, evidence of warning tags used by Bliss subsequent to the sale in this case but prior to plaintiffs injury was properly admitted. Comparative negligence does not apply where contribution is sought from plaintiffs employer; therefore, the apportionment of negligence by the jury, the amended complaint, and the reduction of the lien were all in error.
I
Plaintiff Marjorie Downie filed this products liability action for injuries sustained December 10, 1975, in the course of her employment with Kent Products, Inc. The injury occurred while plaintiff was working on a power press manufactured by E. W. Bliss Company and purchased by Kent from Bliss in 1961. A portion of plaintiff’s hand was amputated when the press unexpectedly recycled while she was hand-loading it. The recycling was apparently due to the malfunctioning of the clutch latch assembly which controls the stroking motion of the press. The part of this assembly which made the press a single-stroke machine, rather than one which would continuously recycle, broke at the time of plaintiff’s injury.
Plaintiff was granted workers’ compensation benefits for the injury from Kent and its workers’ compensation liability insurer, The Home Indemnity Company. At the same time, she instituted this action against Bliss pursuant to MCL 418.827; MSA 17.237(827).
During the course of trial, plaintiff advanced several theories of recovery, but only the issues of implied warranty and negligence arising from a duty to warn were presented to the jury. The jury received a special verdict form on which it was permitted to apportion the liability among plaintiff, Bliss, and Kent. Kent was not a party to the litigation at that time. The jury found no breach of implied warranty but found that defendant’s negligence in failing to warn was a proximate cause of the plaintiffs injuries. The jury awarded $121,000, attributing 45% of the negligence to Kent and 55% to Bliss.
Subsequently, the trial court permitted plaintiff to amend her complaint, adding Kent and Home Indemnity as defendants. Kent and Home Indemnity filed a counterclaim and raised affirmative defenses to the amended complaint. However, the court ordered that the workers’ compensation lien and subrogation rights of Kent and Home Indemnity would be limited according to the special verdict, allowing no reimbursement of workers’ compensation benefits paid or payable until those payments exceeded the amount of Kent’s portion of the liability ($54,450).
Kent and Home Indemnity appealed the trial court’s order allowing amendment of the complaint after the verdict. Bliss cross-appealed, alleging several errors related to the court’s denial of Bliss’ directed verdict motion regarding the duty to warn. Plaintiff also cross-appealed on the issue of whether Kent’s negligence was properly considered by the jury.
After a lengthy analysis of the evidence presented to the trial court, the Court of Appeals concluded that denial of Bliss’ motion for a directed verdict was correct in that plaintiff had made out a prima facie cause of action for negligence on a failure to warn theory. However, the Court of Appeals reversed and remanded the case for a new trial because of the trial court’s improper admission of evidence regarding the warning tags used by Bliss subsequent to the sale of the press, and because the jury’s consideration of the employer’s negligence was improper under the exclusive remedy and reimbursement provisions of the Worker’s Disability Compensation Act, MCL 418.131, 418.827(5); MSA 17.237(131), 17.237(827X5).
Plaintiff’s application for rehearing in the Court of Appeals was denied on May 10, 1983. Plaintiff applied for leave to appeal in this Court, addressing only the evidentiary issue. Bliss cross-appealed on the directed verdict and comparative negligence issues, and answered in opposition to plaintiff’s appeal. Kent answered Bliss’ cross-appeal on the comparative negligence issue only. We granted the application and cross-application for leave to appeal. 418 Mich 948 (1984).
II
In its cross-appeal, Bliss maintains that the Court of Appeals erred in upholding the trial court’s denial of Bliss’ motion for a directed verdict, especially in light of the trial judge’s comments to the effect that he was denying the motion only to avoid a remand, and in light of the Court of Appeals misquotation of those comments. Bliss also alleges error in the Court of Appeals reliance upon the testimony of plaintiffs expert — testimony which embraced an ultimate fact or legal conclusion.
The Court of Appeals devoted six pages of its published opinion to a thorough analysis of the facts relevant to plaintiffs’ cause of action for negligence based on a duty to warn. The Court of Appeals concluded that, even though the evidence was conflicting, it was sufficient to establish a prima facie case that Bliss’ failure to warn was a proximate cause of plaintiffs injuries. In spite of the trial judge’s comments to the contrary, and the typographical mistake in the Court of Appeals opinion, we find no error in the Court of Appeals analysis which would require reversal.
Regarding Bliss’ claim that the Court of Appeals impermissibly relied upon testimony of an expert witness which embraced an ultimate fact or conclusion of law, we agree with the Court of Appeals that there was no error in its admission, but not only for the reason that no specific objection was made at trial. It is true that defendant never made a specific objection to the testimony on the grounds now asserted, see MRE 103(a)(1); People v Worrell, 111 Mich App 27, 38-39; 314 NW2d 516 (1981); however, even if the objection had been made at trial there was no basis on the record for sustaining it.
"Testimony in the form of an opinion or inference otherwise admissible is not objectionable because it embraces an ultimate issue to be decided by the trier of fact.” MRE 704; FRE 704. See People v McClinton Robinson, 417 Mich 231; 331 NW2d 226 (1983); Ruddock v Lodise, 413 Mich 499; 320 NW2d 663 (1982).
That rule is consistent with prior Michigan common law. See Committee Note, MRE 704.
"The function of the expert witness is to supply expert testimony. This includes, when proper foundation is laid, opinion evidence. This opinion evidence may even embrace ultimate issues of fact. * * *
"What the opinion of an expert does not yet extend to is the creation of new legal definitions and standards, and legal conclusions.” In re Powers Estate, 375 Mich 150, 172; 134 NW2d 148 (1965); Brown v Unit Products Corp, 105 Mich App 141, 152; 306 NW2d 425 (1981).
The project engineer’s statement to which defendant Bliss apparently objects was in response to the question,
"Is there any way to design [a safety stop pin and nut] so if it failed, it wouldn’t cause an unexpected cycle of the press?”
Mr. Lewis responded,
"Well, my philosophy has been, as a professional philosopher, that anything mechanical will wear, and anything mechanical will fatigue. And therefore, I subscribe to the philosophy of no hands in the press.”
We find nothing objectionable about this statement. Likewise, we do not find that subsequent statements by Mr. Lewis in any way attempted to create a new legal definition or standard. For example, although it embraced an ultimate issue, the following expert opinion did not constitute expression of a legal standard: "a proper warning for the benefit of the operator, his or herself, would constitute a caution that hands should not be placed near the work point, when there was a possibility the press might operate.” The admissibility of such a statement should not be questioned merely because the determination of liability may turn on whether the jury believes or disbelieves that opinion. See People v Robinson, supra, pp 234-235; Thon v Saginaw Paint Mfg Co, 120 Mich App 745, 751; 327 NW2d 551 (1982). Therefore, the statements by Mr. Lewis were admissible and were properly relied upon by the Court of Appeals in its affirmance of the trial court’s denial of the defendant’s motion for directed verdict.
Ill
Plaintiff appeals the evidentiary ruling of the Court of Appeals to the effect that testimony concerning the warning tags which Bliss installed after 1965, but before plaintiff’s injury, was impermissibly admitted. Plaintiff maintains that such evidence was legally admissible and that possible prejudice to the defendant provided an insufficient basis for reversal and remand where defendant made no meaningful objection to the testimony at trial.
Testimony regarding Bliss’ use of warning tags after 1965 was elicited several times throughout the trial. The first instance was during cross-examination of Mr. Lewis, a representative of Bliss. Plaintiffs counsel posed the question,
"Since the time of sale of this press in 1961, you have changed your method of dealing, and in 1965, you began putting warnings on the presses to the operators?”
Bliss’ objection to this line of questioning was sustained. The second explicit reference to the change in approach came during the cross-examination of Harry Burke, a retired engineer from Bliss. At that point, defendant’s objection was overruled and Mr. Burke was allowed to testify:
"My recollection of that change is about 1965, '66, in that area, where we began putting a warning tag on the press to indicate to operators not to place their hands into the point of operation without some type of safety devices that should be in use for that type of operation.”
Finally, a third reference to the use of warning tags was made spontaneously by defendant’s expert witness, Joseph Schwalje,_
"And yet, this very day, power press manufacturers are putting warnings on presses; * * *. They’re put there so you don’t ask questions that you are asking right now, very frankly.”
The Court of Appeals held:
"The admission into evidence of the tags attached to presses manufactured by Bliss after 1965 was so highly prejudicial as to deny Bliss a fair trial.” Downie v Kent Products, 122 Mich App 722, 737; 333 NW2d 528 (1983).
We do not agree.
Generally, evidence of repairs, changes in conditions, or precautions taken after an incident is not admissible as proof of negligence or culpable conduct. Smith v ER Squibb & Sons, Inc, 405 Mich 79, 92; 273 NW2d 476 (1979); Crews v General Motors, 400 Mich 208, 232; 253 NW2d 617 (1977); Denolf v Frank L Jursik Co, 395 Mich 661, 667; 238 NW2d 1 (1976); Judis v Borg-Warner Corp, 339 Mich 313, 325; 63 NW2d 647 (1954); Phillips v JL Hudson Co, 79 Mich App 425, 426; 263 NW2d 3 (1977). Michigan Rule of Evidence 407 articulates this basic rule of Michigan common law:
"When, after an event, measures are taken which, if taken previously, would have made the event less likely to occur, evidence of the subsequent measures is not admissible to prove negligence or culpable conduct in connection with the event. This rule does not require the exclusion of evidence of subsequent measures when oifered for another purpose, such as proving ownership, control, or feasibility of precautionary measures, if controverted, or impeachment.”_
Likewise, § 2946(3) of 1978 PA 495 states the same rule in the context of products liability actions, specifically:
"Evidence of a change in the philosophy, theory, knowledge, technique, or procedures of or with regard to the manufacture, construction, design, formula, development of standards, preparation, processing, assembly, inspection, testing, listing, certifying, warning, instructing, marketing, advertising, packaging, or labeling made, learned, placed in use or discontinued after the event of death or injury to person or property shall not be admissible in a product liability action to prove liability.” MCL 600.2946(3); MSA 27A.2946(3) (emphasis added).
The question presented here is whether the words "after an event,” in MRE 407, and "after the event of death or injury,” in § 2946(3), operate to require exclusion of the testimony at issue in this case. Representatives of Bliss testified regarding Bliss’ practice, beginning in 1965, of adding warning tags to its presses. The press in this case was purchased in 1961; the injury in question occurred in 1975. Plaintiff argues that, because the evidence relating to the later use of warning tags referred only to the years 1965-1975, it was not "subsequent” in that it did not occur "after the event” or "after the event of * * * injury” — namely the 1975 accident. Given the plain language of MRE 407 as clarified by MCL 600.2946(3); MSA 27A.2946(3), we agree with this interpretation.
The specific wording of MRE 407 is somewhat ambiguous as to whether the relevant "event” was the sale of the machine or the accident. Defendant argues that the sale and delivery of the press was crucial to plaintiffs theory of negligence. The negligence question ultimately presented to the jury was one grounded in failure to warn. As the Court of Appeals noted, plaintiffs counsel argued repeatedly throughout the trial "that the delivery of the press, in 1961, without a warning tag or placard affixed to it was the breach of duty” that amounted to negligence on the part of Bliss. Downie, supra, p 736. Clearly, testimony regarding the addition of such tags to the machines beginning in 1965 was subsequent to the alleged negligent event of failing to install warning tags in 1961. If the relevant event under MRE 407 were the sale and delivery of the machine, then the evidence would be inadmissible.
However, MCL 600.2946(3); MSA 27A.2946(3) commands a different result, in that it specifically refers to "the event of * * * injury” (emphasis added) as the relevant event. Since the statute does not conflict with the evidentiary rule, we read them together and conclude that only those remedial measures taken after the event of injury or death in question will be inadmissible.
MRE 407 is identical with Federal Rule of Evidence 407. The Federal Advisory Committee Notes explain that there are two grounds for the rule. The first has its roots in relevancy; the rule rejects the automatic conclusion that "because the world gets wiser as it gets older, therefore it was foolish before.” Hart v Lancashire & Y R Co, 21 LTR (ns) 261, 263 (1869), cited in Federal Advisory Committee Notes. ____________
The more important ground for excluding this type of evidence "rests on a social policy of encouraging people to take, or at least not discouraging them from taking, steps in furtherance of added safety.” Advisory Committee Notes, FRE 407. McCormick, Evidence (3d ed), § 275; 2 Wigmore, Evidence, § 283. "[Exclusion under the rule restates a basic tenet which has long been accepted in Michigan. It encourages persons to improve their products, property, services and customs without risk of prejudicing any court proceeding and consequently delaying implementation of improvements.” Smith, supra, p 92. See Denolf, supra, p 667; Phillips, supra, pp 426-427.
However, the subsequent repairs exclusion is not without its critics. Several commentators have argued that the "social policy” of encouraging repairs has little basis in fact, that in the modern world of products liability actions against large corporations, few, if any of such potential defendants, will be encouraged to, or discouraged from, undertaking safety measures on the basis of a rule of evidence alone. See 2 Weinstein, Evidence, ¶ 407[02]; Schwartz, The Exclusionary Rule on Subsequent Repairs — A Rule in Need of Repair, 7 Forum 1, 7 (1971). While we do not question the’ application of the rule in the case where remedial measures are taken in response to the accident in question, we decline to extend the coverage of the rule to the situation at bar merely on the basis of a social policy which has questionable application to this set of facts. It goes without saying that market forces (the desire to prevent future costly lawsuits) and a manufacturer’s duty to warn, generally, see Comstock v General Motors, 358 Mich 163; 99 NW2d 627 (1959), will operate to encourage the adoption of appropriate remedial measures. The proposed extension of . an evidentiaryrule beyond its intended meaning will not provide any significant further encouragement of safety activities.
This conclusion is in keeping with the decisions of the Fifth Circuit Court of Appeals, which have also construed FRE 407 literally in applying it to this situation. Arceneaux v Texaco, Inc, 623 F2d 924 (CA 5, 1980); Foster v Ford Motor Co, 621 F2d 715 (CA 5, 1980); Ramos v Liberty Mutual Ins Co, 615 F2d 334 (CA 5, 1980), cert den 449 US 1112 (1981); Rozier v Ford Motor Co, 573 F2d 1332 (CA 5, 1978). Likewise, state court decisions on this question are also in agreement with our conclusion, although they construe individual state versions of FRE 407. See, e.g., Schaeffer v General Motors Corp, 372 Mass 171; 360 NE2d 1062 (1977); doCanto v Ametek, Inc, 367 Mass 776; 328 NE2d 873 (1975); Caprara v Chrysler Corp, 52 NY2d 114; 436 NYS2d 251; 417 NE2d 545 (1981); Incollingo v Ewing, 444 Pa 263; 282 A2d 206 (1971).
Thus, relying on the plain language of MRE 407 and MCL 600.2946(3); MSA 27A.2946(3), we find the rule to be inapplicable to the situation in this case — where remedial measures were undertaken after the sale of a machine but before the injury in question. The rule was written to apply only to the situation where such measures are taken after the accident or injury in question.
Therefore, the trial court’s exclusion of Mr. Lewis’ testimony was in error. Admission of the testimony of Mr. Burke was not violative of MRE 407, and the spontaneous reference of Mr. Schwalje to the general practice in the industry of installing warning tags was also properly admit ted. The decision of the Court of Appeals on this issue is reversed.
Plaintiff also argues that the testimony regarding the subsequent use of warning tags should be held admissible under the "feasibility” exception to the rule. Given our finding that MRE 407 did not require exclusion of the evidence we do not reach this question. We also do not reach plaintiff’s argument that there can be no error because defendant’s counsel failed to sufficiently object to the questionable testimony. Likewise, we do not reach the issue whether the evidence was material.
IV
The final question presented for our consideration in this case is the most significant: Does thé adoption of the doctrine of comparative negligence in this state affect a defendant-manufacturer’s ability to obtain contribution from a negligent employer who is already liable to the plaintiff-employee for workers’ compensation benefits? In light of the statutory scheme governing workers’ compensation and despite the equitable arguments advanced on the part of the manufacturer, to which we are sympathetic, we must conclude that any application of comparative fault principles in this context must await legislative action. In the interests of efficiency, stability, and simplicity, we decline to inject common-law principles into the wholly statutory recovery scheme which was estab lished by the Legislature to govern all actions arising out of injuries in the workplace.
Professor Larson has noted that the question presented here is "[p]erhaps the most evenly balanced controversy in all of compensation law * * 2A Larson, Workmen’s Compensation Law, § 76.11. We agree with his statement that "[e]ach side to the controversy has an argument in its favor which, considered alone, sounds irresistible.” Id. Kent, the employer, and its insurer maintain that, pursuant to § 827(5) of the WDCA, MCL 418.827(5); MSA 17.237(827)(5), they have a right to full reimbursement, out of plaintiffs recovery against Bliss, for the workers’ compensation benefits paid and payable to the plaintiff. Any reduction of that reimbursement based on its alleged negligence in causing the injury, would be violative of the exclusive remedy provision of the WDCA, MCL 418.131; MSA 17.237(131). Bliss, on the other hand, argues that, just because the accident in this case happened to have been work related, it should not be forced to pay 100% of plaintiffs recovery when Kent has been found liable for 45% of plaintiffs injuries, especially in light of the judicial and legislative adoptions of the doctrine of comparative negligence.
The exclusive remedy provision of the WDCA provides, quite simply, that "[t]he right to the recovery of benefits as provided in this act shall be the employee’s exclusive remedy against the employer.” MCL 418.131; MSA 17.237(131). See Solakis v Roberts, 395 Mich 13; 233 NW2d 1 (1975). In Husted v Consumers Power Co, 376 Mich 41, 53; 135 NW2d 370 (1965), we referred to this exclusive remedy provision as the employer’s quo, received in exchange for his quid. We noted that the "primordial intent [of the Legislature in enacting the WDCA] was that the quo to be received by the employer in return for his quid would be outright and absolute immunity from liability (except as provided in the act) stemming from each compensable injury.” The exclusivity provision is an example of the importance which the drafters of workers’ compensation laws, generally, placed on simple, automatic remedies. Larson, supra, § 76.93. The provision may be equated with the doctrine of strict liability, in that the employee is guaranteed some limited compensation for injury from the employer, while the employer rests assured that, in the ordinary case, it is immune from further suit by the employee based on the same accident. "The act was originally adopted to give employers protection against common-law actions,” while assuring adequate compensation of the injured employee. Lahti v Fosterling, 357 Mich 578, 585; 99 NW2d 490 (1959).
In addition to the exclusivity provision, another aspect of the workers’ compensation scheme militates in favor of retaining the status quo regarding recovery in these types of cases. Although the act requires the workers’ compensation claim to be the employee’s exclusive remedy against the employer, the act also provides that receipt of benefits does not constitute an election of remedies. It permits third party suits, such as that brought against Bliss, which arise out of the same workplace accident. MCL 418.827(1); MSA 17.237(827X1). After deduction for expenses, any recovery from such a "third party” is then used to reimburse the employer "for any amounts paid or payable under [the] act * * MCL 418.827(5); MSA 17.237(827)(5). Even earlier versions of the WDCA afforded the employer who had paid workers’ compensation benefits a right to enforce the liability of a third party wrongdoer to the employee. 1915 CL 5468. The employer’s right of recovery was provided through subrogation without assignment, and the employer could bring suit in his own name or that of his workers’ compensation insurer. Michigan Employers’ Casualty v Doucette, 218 Mich 363, 365; 188 NW 507 (1922).
The current version of the reimbursement provision "creates a statutory lien in favor of the [workers’ compensation] carrier. * * * [T]his lien is to be paid before any excess recovery is to be paid to the employee.” Ohio Farmers Ins Co v Neff, 112 Mich App 53, 57; 315 NW2d 553 (1981). It was the entitlement of Kent or Home Indemnity to this reimbursement of benefits which the trial court order reduced in an amount proportional to Kent’s negligence, as indicated by the jury on the special verdict form.
The reimbursement provision allows the employee to recover the benefits provided by the WDCA or the damages recoverable at common law, but not both. Thus, the employee is permitted "to retain the best of both schemes.” Great American Ins Co v Queen, 410 Mich 73, 92; 300 NW2d 895 (1980). The reimbursement provision does not preclude the full reimbursement of an employer who was also negligent. We agree with the Court of Appeals assessment that the reimbursement section
"provides clearly and unambiguously that the employer or carrier is to be reimbursed from 'any recovery’ against a third party for 'any amounts’ paid or payable to the employee under the WDCA as of the date of the recovery. The statute speaks for itself; there is no room for judicial interpretation or construction.”
Land v The George Schmidt Co, 122 Mich App 167, 170; 333 NW2d 30 (1982). Accord, Schweitzer v Elox Division of Colt Industries, 70 NJ 280, 287; 359 A2d 857 (1976). Thus, the exclusivity provision of the WDCA, in combination with the reimbursement scheme, applicable in the case of a third party suit, is an aspect of the WDCA which is so integral to the workers’ compensation system in this state that it may be said to overshadow the ordinary common-law recovery principles which otherwise apply. See Douglas v Robbins & Myers, 505 F Supp 765, 768 (WD Mich, 1980).
The question of the employer’s contribution in this case arises, in part, because of the special verdict form which allowed the jury to apportion negligence to the employer Kent, and because the plaintiff was allowed to amend her complaint after the verdict, adding Kent and Home Indemnity as defendants. Because Kent was brought into this action through plaintiff’s amended complaint, rather than through impleader by Bliss, we could dispose of the larger questions merely on the basis of the exclusive remedy provision. Clearly, it is impermissible for an employee in this context to name her employer as a defendant in a suit arising out of a work-related injury for which she has already received workers’ compensation benefits. However, since the amended complaint was apparently in response to the jury’s finding on the special verdict form, which assessed Kent’s negligence according to the principles of comparative fault, we will move beyond the exclusivity question to the more fundamental problem: Had Kent and Home Indemnity been impleaded by Bliss, was the jury’s assessment of Kent’s negligence, and the apportionment of the damages which followed, permissible? - -
There is a substantive right to contribution on the part of a nonintentional tortfeasor who has paid more than his pro-rata share of the common liability. MCL 600.2925a(1), (2); MSA 27A.2925(1)(1), (2); Sziber v Stout, 419 Mich 514; 358 NW2d 330 (1984); Caldwell v Fox, 394 Mich 401, 417-420; 231 NW2d 46 (1975); Moyses v Spartan Asphalt Paving Co, 383 Mich 314, 334; 174 NW2d 797 (1970). Under the contribution statute, there must be a "common burden of liability in tort” shared among the tortfeasors. O’Dowd v General Motors Corp, 419 Mich 597, 605; 358 NW2d 553 (1984).
However, because of the exclusive remedy provision of the WDCA, this general right to contribution is limited when a third party attempts to implead an employer who has already settled a workers’ compensation claim with the plaintiff-employee. Following the majority rule in the United States, we held in Husted v Consumers Power Co, supra, p 56, that "if [the employee] could not sue his employer * * *, and we know he could not, [the employer and original defendant] cannot be joint tortfeasors by law. [The original defendant] therefore cannot sue [the employer] for contribution should it be held to respond to the plaintiffs in damages.” In the words of the United States District Court for the Western District of Michigan, interpreting the Dusted decision in 1980,
"for a cause of action in contribution to be present, the employer would have to have some further liability to the plaintiff arising out of the injury. This, however, would violate the exclusive remedy provision of section 131 of the [WDCA]. Under the workers’ compensation law, an employer has no common liability, and is not a joint tortfeasor with the defendant.” Douglas, supra, p 769 (emphasis added). See Venters v Michigan Gas Utilities Co, 493 F Supp 345 (WD Mich, 1980).
The disallowance of contribution in this situation, is generally premised on the fact that the employer’s liability is purely statutory, pursuant to the WDCA. See Jordan v Solventol Chemical Products, Inc, 74 Mich App 113, 117-118; 253 NW2d 676 (1977); McLouth Steel Corp v A E Anderson Construction Corp, 48 Mich App 424, 430; 210 NW2d 448 (1973). Because the workers’ compensation scheme is in derogation of the common law, and totally outside it, Solakis, supra, p 20, quoting Tews v C F Hanks Coal Co, 267 Mich 466, 468-469; 255 NW2d 227 (1934), there is no "common liability” in tort between the third-party defendant and the employer — a prerequisite to contribution. MCL 600.2925a(1), (2); MSA 27A.2925(1)(1), (2).
Although we have recognized an exception to this general rule in the case of an express or implied indemnity agreement between the original defendant and the employer, we have also emphasized the application of the rule when no such agreement is alleged. Dale v Whiteman, 388 Mich 698, 708; 202 NW2d 797 (1972), held that, although the WDCA bars "any action against an employer by the employee or one which is derivative from [the employee’s] claim,” it does not bar a claim based on an implied indemnity agreement between the employer and the third party. See Minster Machine Co v Diamond Stamping Co, 72 Mich App 58, 64-65; 248 NW2d 676 (1976). Cf. Langley v Harris Corp, 413 Mich 592; 321 NW2d 662 (1982) (insufficient contractual relationship upon which to establish an obligation to indemnify). No such indemnity theory has been argued by Bliss in this case, nor would one be applicable, since Bliss cannot claim to be without fault. See Dale, supra, p 706. Therefore, we do not address any possible application of the indemnity exception.
In spite of these former pronouncements, Bliss argues that the adoption of pure comparative negligence in this state in 1979 implicitly abrogated the rule which would allow one tortfeasor, the original defendant, to be held liable for the entire award when responsible for only a portion of the negligence. The doctrine of pure comparative negligence was adopted in place of contributory negligence in Placek v Sterling Heights, 405 Mich 638; 275 NW2d 511 (1979). Basically, contributory negligence had operated as a total bar to recovery when a plaintiff was at all negligent; comparative negligence, by contrast, apportions responsibility in proportion to fault. Id., p 650, fn 1. The comparative negligence approach "most nearly accomplishes the goal of a fair system of apportionment of damages.” Id., p 660.
Even prior to this Court’s decision in Placek, the Legislature had modified the contributory negligence doctrine in products liability actions to allow reduction of damages in proportion to the amount of negligence attributed to the plaintiff. MCL 600.2949; MSA 27A.2949. More recently the Legislature established that the doctrine of comparative negligence applies generally among tortfeasors. MCL 600.2925b; MSA 27A.2925(2) (as amended by 1982 PA 147).
Thus, were this an ordinary products liability case and Kent an ordinary third-party tortfeasor and not the plaintiffs employer, these principles would apply to validate the actions taken by the trial court in submitting the special form to the jury and holding Kent liable for its portion of the damages. However, as the United States District Court noted when presented with the same argument prior to passage of 1982 PA 147, Placek "concerned only the apportionment of fault between the plaintiff and the defendant. It did not involve a third-party complaint or worker’s compensation * * Venters, supra, p 349. (Emphasis added.) Therefore, Placek does not dictate a result in this case.
The exclusive remedy and reimbursement provisions of the WDCA provide a necessary backdrop against which this decision is made. While the eqüities in favor of Bliss are strong, we choose to follow the precedent established in Husted. The basic integrity of the workers’ compensation scheme must be preserved even in the face of the recent judicial and legislative adoptions of the doctrine of comparative negligence.
Other courts have reached the same result in considering Michigan law. In Cutter v Massey-Ferguson, 114 Mich App 28; 318 NW2d 554 (1982), the defendant argued that an employer who has already paid workers’ compensation benefits to the plaintiff may be joined as a third-party defendant in a products liability action for the purpose of determining the percentage of causal negligence attributable to the employer so as to reduce ác cordingly the primary defendant’s liability to the plaintiff. Id., p 32. The Court of Appeals noted that because of the exclusive remedy provision, the employee could not assert a claim against his employer. It held that "the concept of joint and several liability has not been abrogated by adoption of comparative negligence in Placek,” and that Placek did not require allocation of fault in such a case. Id., p 37. See Caldwell v Cleveland-Cliffs Iron Co, 111 Mich App 721, 724-725; 315 NW2d 186 (1981). We agree.
Likewise, several federal district court decisions are also in accord. Douglas, supra, McPike v Die Casters Equipment Corp, 504 F Supp 1056 (WD Mich, 1980), and Venters, supra, all uphold the preeminence of the employer’s immunity under the WDCA in cases where contribution is sought by a defendant from a negligent employer. Those federal district judges agreed that Placek did not affect the substantive rights of employers as established by the Legislature under the WDCA. "Any such adjustment [of the workers’ compensation balance] must be undertaken openly and forthrightly by the Michigan legislature.” Douglas, supra, p 769.
We recognize that other jurisdictions have adopted different approaches to the problem of reconciling comparative negligence principles with workers’ compensation statutes. See Larson, supra, §§ 76.20-76.39: Larson, Third-Party Action Over Against Workers’ Compensation Employer, 1982 Duke L J 483, 489-499. We maintain the majority rule enunciated in Husted, however, despite Placek’s injection of comparative negligence into the applicable legal formula.
We refuse to abandon, as did the Minnesota Supreme Court, the current prerequisite to contribution: "common liability in tort.” While we agree with that court that "[contribution is a flexible, equitable remedy designed to accomplish a fair allocation of loss among parties,” Lambertson v Cincinnati Corp, 312 Minn 114; 257 NW2d 679 (1977); O’Dowd, supra, p 607, we cannot agree that the principle of fairness, alone, should operate to allow abrogation of the employer immunity provided by thé WDCA.
As Professor Larson has noted, premising the rule upon fairness to the original defendant "ignores] the fact that * * * the employer[] has already made concessions and assumed liabilities to the employee, for which his immunity was the quid pro quo.” Larson, supra, 1982 Duke L J, p 539. Additionally, such an approach sacrifices simplicity and efficiency. Id. While our position may be characterized as "pro-employer,” Larson, supra, § 76.91(a), it should be noted that both Bliss and Kent are employers and thus benefit generally from this rule. Moreover, the rule is also most in keeping with our present legislative scheme.
We agree that it is only logical for both the manufacturer and employer to be held responsible for an employee’s injury if they have shared in its causation. The Legislature might be advised to provide a means for reducing the employer’s lien on third-party recoveries in certain cases. However such a change would affect the "bargain” which has been struck between employers and employees, generally, and would involve the weighing and balancing of all interests. The Legislature is far more equipped than we to deal with such a major transformation of the workers’ compensation system. As the Alaska Supreme Court concluded when presented with the same question,
"there is a fair and substantial relationship between the legislative objective of providing guaranteed, expeditious compensation to the injured employee and the limitation on the employer’s total liability regardless of its percentage of fault, even though that limitation has the effect of denying the third party tortfeasors the right to pro rata contribution from the employer.” Arctic Structures, Inc v Wedmore, 605 P2d 426, 437-438 (Alas, 1979).
In light of this discussion, the inclusion of Kent on the special verdict form and the addition of Kent and Home Indemnity to the plaintiff’s amended complaint, as well as the reduction of the reimbursement to which Kent and Home Indemnity were entitled, amounted to error on the part of the trial court. On remand, the trial court shall not permit the jury to consider Kent’s negligence for the purpose of allowing any reduction of the statutory reimbursement of Kent or Home Indemnity by amounts perceived to be proportional to Kent’s liability; nor shall it allow the reduction of such statutory reimbursement.
The opinion of the Court of Appeals is affirmed in part, and reversed in part. We remand for a new trial in conformance with this opinion.
Williams, C.J., and Kavanagh, Levin, Ryan, Cavanagh, and Boyle, JJ., concurred with Brickley, J.
Bliss, Gulf and Western Industry, Inc., Gulf and Western Industrial Products Company, and General Motors Corporation, were originally named as defendants. GMC was granted summary judgment, dismissing it from the suit. Bliss, Gulf and Western Industry, Inc., and Gulf and Western Industrial Products Company are considered the same party.
Plaintiff had alleged strict liability, fraud and deceit, implied warranty, and negligence based on claims of gross negligence, a statutory violation, failure to guard, and failure to warn.
Although the trial judge denied defendant’s directed verdict motion on the issue of duty to warn regarding the operational dangers of the press, he was not wholly persuaded by plaintiff’s argument that there was sufficient evidence of the existence of a duty.
"The court denies the motion. I could give a long dissertation as to why, but it would have nothing to do with being truthful with either party as far as the legal burden. It has to do with the current status of our appellate process and the appellate courts deciding cases in toto with not all of the whole portion of the case. And so as a result, I’ll be on the cautious side. I totally agree with the record, with the defendants’ contention that there is no evidence on this record which a reasonable jury could find that there was a duty to warn. But I would deny the motion. If it gets to the Court of Appeals, they can totally dispose of this case, rather than remanding it to a trial court to waste double or triple time.
"With reference to the engineering design, there is evidence to establish a fact question. With the warning issue, there isn’t. But I’ll let it go to the jury.”
See fn 3.
The transcript indicates Judge Pannucci’s statement to be: "I totally agree with the record, with the defendants’ contention * * rather than "I totally disagree [sic] * * as that statement is quoted by the Court of Appeals in Downie v Kent Products, 122 Mich App 722, 728; 333 NW2d 528 (1983).
Bliss also finds error in the trial court’s reliance upon the testimony of defendant’s expert witness, which allegedly occurred after the motion for directed verdict. See GCR 515.1. We presume that defendant Bliss is referring to the testimony of its project engineer, referred to several times by the Court of Appeals in its analysis of plaintiffs prima facie case. See Downie, fn 5 supra, pp 732, 733. However, we note that the portions of that witness’ testimony relied upon by the Court of Appeals occurred prior to defendant’s directed verdict motion. Therefore, we find no basis for alleging error.
In response to the Court of Appeals finding that Bliss’ objection was not specific enough, and that its objections had referred to the question of competency only, Bliss presents the following statement by counsel as evidence of its objection to the expression of legal conclusions by the expert:
"I guess I want to object at this time, if we are going to get into what it sounds like, may or may not be a philosophy regarding the use of presses.”
As noted in text, infra, the "philosophy” to which the expert had referred was one related to his professional opinion that "anything mechanical will wear,” and that, therefore, hands should be kept out of the presses. This was no "legalistic philosophy,” as alleged by defendant.
"Q. You were present and working at Bliss Press in [1961], when this press that Mrs. Downie was operating at the time of her injury was manufacturered [sic] and sold?
”A. That’s correct.
"Q. At that time, were there any notations of danger or instructions for safety use imprinted or attached to the press, for the benefit of the operator? I mean by Bliss at the time of sale.
"A. You are describing some type of tag on the press itself for the operator?
"Q. Yes.
"A. Not to my knowledge.
"Q. Before Mrs. Downie’s injury in December of 1975, during your time with Bliss, did you make any changes in that regard? That is, with regard to the—
"Mr. Exelby [defense counsel]: Your Honor, I object to this whole line of questioning. The issue in this case is: A press is manufactured and shipped in 1961.”
While the Court of Appeals incorrectly referred to the admission of “the tags,” rather than the testimony concerning the tags, we do not find a significant difference between the two types of evidence which would require an alternate analysis or conclusion.
Although the adequacy of a warning letter sent out by Bliss in 1975 also became an issue during the course of the trial, it did not form the basis of the plaintiff’s negligence count.
"Such evidence is said to be irrelevant because it is capable of explanations equally as plausible as an admission by conduct of preaccident neglect of duty. If relevancy were the only criteria, Professors Wigmore and McCormick both point out that such evidence would meet the usual standards of relevancy.” Denolf, supra, p 667.
Regarding the relevancy of the evidence at issue in this case, plaintiff’s counsel argued that it should be admitted as evidence of the capabilities of Bliss’ engineers to appreciate the safety problems with the machine and make any necessary changes prior to the injury in question.
The answer to this question results in a finding of error as to all three challenged actions by the trial court: the inclusion of Kent on the special verdict form, the allowance of the amended complaint and the reduction of the workers’ compensation lien. Therefore, it is unnecessary to reach the procedural and constitutional arguments presented to the Court as evidence of errors unrelated to the more fundamental issue.
This rule has evolved gradually over the years:
"At common law, contribution was not, as a general rule, recoverable among or between joint wrongdoers or tortfeasors. The Legislature partially abrogated the common-law bar by adopting the 1939 Uniform Contribution Among Tortfeasors Act which provided for contribution among or between 'joint’ tortfeasors. This Court abolished remnants of the common-law rule in Moyses [supra, pp 329, 334].’’ O’Dowd v General Motors Corp, 419 Mich 597, 603; 358 NW2d 553 (1984).
Subsequently, MCL 600.2925a; MSA 27A.2925(1) was also adopted by the Legislature.
There are other exceptions to the exclusive remedy rule which are also irrelevant here. See, generally, Exceptions to the Exclusive Remedy Requirement of Workers’ Compensation Statute, 96 Harv L Rev 1641 (1983). In Michigan, as the Court of Appeals has noted,
"The exceptions to the exclusive remedy provision for actions which did not arise out of the employer-employee relationship and for actions in which plaintiff is not seeking to recover damages for personal injuries are derived from the language of the statute.” Genson v Bofors-Lakeway, Inc, 122 Mich App 470, 478; 332 NW2d 507 (1983) (emphasis added).
Therefore, the existence of other exceptions has no bearing on our decision in this case, since the requested exception would fly in the face of the current statutory language.
Placek adopted the opinion of Justice Williams in Kirby v Larson, 400 Mich 585; 256 NW2d 400 (1977).
The Court of Appeals was aware of the equitable arguments on behalf of the products liability defendants:
"[W]e are concerned that in some cases negligent employers appear to escape responsibility at the expense of manufacturers whose product liability exposure is relatively less in terms of fault than that of the employer.” Cutter, supra, p 37, fn 14.
We also recognize the policy implications of our decision to place priority upon the workers’ compensation scheme established by the Legislature. However, we highly encourage the Legislature, in light of the common-law evolution of comparative negligence principles and the changed legal climate in which work-related injuries now occur, to amend the WDCA to better balance the equities. In the absence of such legislative action, however, we decline to upset the current balance.
The approaches vary. At one extreme is one which would make an employer liable for damages proportionate to the full extent of the negligence, without limitations. See, e.g., Skinner v Reed-Prentice Division Package Machinery Co, 70 111 2d 1; 374 NE2d 437 (1978), cert den 436 US 946 (1978). At the other extreme is a proposal which would make workers’ compensation the sole source of an employee’s recovery, see Final Report of the Commerce Department Task Force on Products Liability and Insurance, 43 Fed Reg 14,612 (1978), cited in Stahle, Contribution From a Negligent Employer: A Problem in Search of a Solution, 32 Drake L Rev 945, 953 (1982-1983).
A moderate position has been adopted by the Minnesota Supreme Court, which took a result-oriented approach. In Lambertson v Cincinnati Corp, 312 Minn 114; 257 NW2d 679 (1977), that court established a rule which would allow contribution from an employer in this situation, but only up to the amount of workers’ compensation benefits paid or payable. | [
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Bashara, J.
Ford Motor Company (Ford) appeals, by leave granted, from a Workers’ Compensation Appeal Board decision affirming an administrative law judge’s award of benefits to Irene Lopucki where her husband, Anthony Lopucki, committed suicide.
The first issue which must be resolved is whether death resulting from suicide is compensable under Michigan’s Worker’s Disability Compensation Act. The act, MCL 418.101 et seq.; MSA 17.237(101) et seq., does not specifically address the issue. Nor have the appellate courts of this state conclusively arrived at the test to be applied in determining the compensability of death resulting from suicide under the act.
The only case to address the issue is Trombley v Coldwater State Home & Training School, 366 Mich 649; 115 NW2d 561 (1962), in which an award of compensation was affirmed by an equally divided Court. There, the employee was an attendant nurse of mentally defective patients. As a result of complaints by a patient’s relatives of injuries suffered which were possibly attributable to Mr. Trombley, a legislative investigation was held.
Trombley became depressed over legislative interrogation of the issue. One evening, he saw a television broadcast indicating that the investigation would continue. He made no comment, but threw up his hands and went to bed. Early the next morning, he committed suicide by shooting himself.
The appeal board affirmed an award of benefits, holding that death was due to the legislative inquiry. The board also found that the death was associated with an uncontrollable impulse and was not a voluntary action.
Justice Carr’s opinion for reversal would award compensation only if the suicide was the result of an irresistible impulse. The opinion stated:
"These foregoing decisions are fairly typical of cases from other States recognizing the general rule that workmen’s compensation is not recoverable because of the suicide of an employee injured in the course of his employment, such injury arising therefrom, unless as a proven result the suicide has occurred in a moment of insane frenzy or because of irresistible impulse. Deliberate planning of an act of suicide, with mental ability to understand the nature of the act, involves the introduction of an intervening cause in the chain of circumstances to which cause of death must be attributed.” Trombley, supra, 660.
The opinion by Justice Souris for affirmance urged adoption of a rule which allows payment of benefits "upon a showing that the work-connected mental disorder so impaired the victim’s reasoning faculties that his act of suicide was not voluntary”. Trombley, supra, 669. A 3-3 split, with two of the justices abstaining, resulted in affirmance of the appeal board’s award of compensation.
Professor Arthur Larson has named the two approaches taken in Trombley the "voluntary wilful choice test” and the "chain-of-causation test”. He explains the test as follows:
"At one time the field was dominated by the voluntary wilful choice test, sometimes called the rule in Sponatski’s Case, under which compensation in suicide cases was not payable unless there followed as the direct result of a physical injury an insanity of such violence as to cause the victim to take his own life through an uncontrollable impulse or in a delirium of frenzy without conscious volition to produce death. This doctrine was gradually displaced as majority rule by the chain-of-causation test, which found compensability if the injury caused the deranged mental condition which in turn caused the suicide.” 1A Larson’s Workmen’s Compensation Law, § 36.10. (Footnotes omitted.)
Larson claims that, whatever the approach taken, "[t]he issue boils down to one of proximate versus independent intervening cause”. Id.
We require a different approach. Due to the Michigan Supreme Court’s decision in Deziel v Difco Laboratories, Inc, 403 Mich 1; 268 NW2d 1 (1978), the theory of an intervening intermediate cause of the suicide is not a viable theory in Michigan. Such theory assumes the existence of a rational part of the brain which chooses suicide despite the survival instinct and this rational portion of the brain is the "actual” cause of the suicide. The Deziel decision eliminated the requirement of showing any "actual” causal nexus between the employement and the injury. It is now sufficient if a strictly subjective causal nexus is supplied. If it is factually established that a claimant honestly, though mistakenly, perceived some personal injury incurred during his employment caused his disability, then he is entitled to compensation. Deziel, supra, 26.
Therefore, we need go no further than to apply the three-step analysis of Deziel to facts involving suicide. The three-step analysis of Deziel is as follows:
" T) Is the claimant disabled?
" '2) If so, is the claimant disabled on account of some "personal injury”?
" '3) Did the claimant’s employment aggravate, accelerate, or combine with some internal weakness or disease to produce the personal injury?’ ” Deziel, supra, 10.
Applying this test to a suicide case requires simply substituting the suicide for a disability. The test then becomes:
1) Is the employee dead on account of suicide?
2) If so, did the employee commit suicide on account of some personal injury, physical or psychological?
3) Did the employee’s employment aggravate, accelerate or combine with some internal weakness or disease to produce the state of mind which ultimately chose suicide?
The claiment is entitled to compensation if it is factually established that the employee honestly perceived that some personal injury, physical or psychological, occurred during work which caused him to take his life.
The subjective causal nexus will have to be established by testimony of those who knew and spoke to the deceased prior to the suicide, which testimony indicates that the deceased’s state of mind (the personal injury) was such that he took his own life for employment-related reasons, actual or honestly though mistakenly perceived by the employee.
This analysis ignores the voluntary versus involuntary approach which is the basis of both tests described by Professor Larson. It is our belief that suicide is always "voluntary” to the extent that it never occurs by accident nor by the physical act of another. The mind makes a choice between continuation of the status quo or termination.
We conclude that death resulting from suicide is compensable under the act, provided it can be determined that the employment aggravated, accelerated or combined with the employee’s state of mind which ultimately resulted in the suicide.
It is left to us, then, to resolve whether the appeal board erred in finding that death in the instant case arose out of and in the course of decedent’s employment. We initially note that findings of the appeal board are conclusive if supported by any competent evidence in the record. Derwinski v Eureka Tire Co, 407 Mich 469; 286 NW2d 672 (1979). Const 1963, art 6, § 28; MCL 418.861; MSA 17.237(861).
The following facts, as found by the appeal board, are supported by competent evidence in the record.
The decedent, Anthony Lopucki, began working for Ford Motor Company in 1950. Beginning as an apprentice toolmaker, he rose to a high-level supervisory position in the experimental car fabrication assembly section. Mr. Lopucki’s problems with the company began in 1970. In May of that year, he was moved to a less prestigious job in the experimental garage.
On November 9, 1970, decedent’s son was in a serious accident which left him immobilized for seven or eight months. Mrs. Lopucki testified that the accident did not leave the decedent in an unduly depressed state.
He was criticized by his new supervisor, Mr. Younger, in an appraisal dated November 30, 1970. In December of 1970, Mr. Younger discovered that the decedent had been using the company pool car on weekends, in violation of company policy. This resulted in a confrontation between the two men. Mrs. Lopucki testified that her husband was "shaken” after the incident and felt that Mr. Younger was attempting to get him fired.
On January 19, 1971, a security guard observed decedent fueling his personal car from special gas pumps which were to be used exclusively for the purpose of fueling experimental cars. Decedent’s conduct at a meeting held on January 22, 1971, was less than exemplary. Decedent claimed his car had run out of gas and that it was an emergency. He called Mr. Younger an uncomplimentary name and both men exchanged heated conversation. As a result, Mr. Lopucki received a reprimand. After this incident and the one concerning the pool car, decedent came home swearing, crying and in a general state of emotional distress. He appeared disappointed in himself and expressed constant fear that he would be fired.
On February 16, 1971, he visited a doctor with the complaint that he was not sleeping well. The doctor prescribed tranquilizers. On March 1, 1971, Mr. Lopucki was transferred to a nonsupervisory position. He indicated to his wife that the new supervisor was very pleasant, but that his desk was placed right next to the supervisor.
He complained to his wife that the work given him involved duties he performed 20 years ago. He apparently could not adjust to doing the work because he had been away from it for such a long time.
The decedent did not work on Thursday, March 18, 1971, because he was depressed and did not feel like working. He worked on Friday, March 19, 1971. On Sunday morning, Mrs. Lopucki found her husband’s body in the family garage. The auto was running and the garage door was closed. There is therefore record support for application of the test heretofore enunciated in this opinion.
The reasoning of the appeal board in the case of Gahagan v Henry Ford Hospital, 1977 WCABO 1216 (No 195), though not binding, is helpful. At page 1260, Member Marshall wrote:
"It is, of course, true that where we are confronted with pure hallucinatory experience unprovoked by any work-related stimuli or environmental occurrences then there can be no showing of causation or compensable disability or death. But this is not the case here or in other situations where there are demonstrable employment-related events, conditions, pressures or stresses which precipitate or trigger a psychotic or psychological state and ultimate suicide or which 'aggravated or accelerated or combined with some internal weakness to produce the injury’. Deziel, supra. This is a factual finding based upon evidentiary and established facts. Where hallucinatory, delusional or other abnormal psychological and emotional states are traceable psychologically to environmental and other work-related condi tions, however innocuous or seemingly trivial from an objective point of view, the burden of proof has been satisfied.”
We concur in the conclusions reached by the appeal board that the death of claimant’s decedent is compensable.
Ford claims that the use of the pool car and gasoline in violation of company policy, the acts which gave rise to Mr. Lopucki’s problems, were purely personal and did not arise out of or in the course of employment. Cases cited by the defendant in support of its position are dissimilar to the facts of the case at bar. Bradley v Stevens, 329 Mich 556; 46 NW2d 382 (1951), and Watson v Aquinas College, 83 Mich App 192; 268 NW2d 342 (1978), lv den 403 Mich 848 (1978), deal with questions of respondeat superior and "scope of employment”. However, those concepts are not viable in a workmen’s compensation analysis. Thomas v Certified Refrigeration, Inc, 392 Mich 623; 221 NW2d 378 (1974), Crilly v Ballou, 353 Mich 303; 91 NW2d 493 (1958).
The circuitous nature of the argument is revealed by the fact that Ford cites, in support of its argument, the following paragraph from 1A Larson’s Workmen’s Compensation Law, § 31.00:
" 'When misconduct involves a prohibited overstepping of the boundaries defining the ultimate work to be done by the claimant, the prohibited act is outside the course of employment. But when misconduct involves a violation of regulations or prohibitions relating to method of accomplishing that ultimate work, the act remains within the course of employment. Violations of express prohibitions relating to incidental activities, such as seeking personal comfort, as distinguished from activities contributing directly to the accomplishment of the main job, are an interruption of the course of employment.’ (Emphasis added.)”
Ford fails to note that the quotation itself refers to "misconduct” and the section from which the quotation is lifted is specifically addressed to the concept of misconduct. If we accept the appeal board’s finding that Mr. Lopucki’s conduct was not "intentional and wilful”, as we must do, then the quoted passage from Larson’s addressing misconduct is irrelevant.
Ford also failed to note Larson’s introductory section on misconduct cases which explains the relationship between §§ 305 and 301 of Michigan’s act:
"Misconduct of the employee, whether negligent or wilful, is immaterial not because it is affirmatively stated to be so in the statutes (although a few contain such language), but because the basic test of coverage is relation of the injury to the employment, with no reference to the personal merits of the parties. The compensation act marks out a circle whose boundaries are fixed by the 'arising out of and 'in the course of employment concept. Within that circle there is compensation. Outside there is not. Most acts are simply silent on the entire question of general fault in the employee. There is therefore no occasion to distinguish between negligent fault and wilful fault, since fault itself can have no bearing on the process of drawing the boundaries of compensability.” 1A Larson’s Workmen’s Compensation Law, § 30.10.
The Michigan Legislature has made the decision as to what conduct does not arise out of and in the course of employment by enacting § 305 of the act. The appeal board found that Mr. Lopucki’s conduct did not rise to the level of intentional and wilful misconduct. Certainly, Mr. Lopucki’s conduct would fall within the dictionary definition of the term "misconduct”. However, the Legislature has determined that injuries which are the result of an employee’s own acts are compensable unless they rise to the level of "intentional and wilful misconduct”. Since the appeal board found that Mr. Lopucki’s conduct did not rise to this level, the case is more akin to cases involving horseplay. See Crilly v Ballou, supra, and Harrison v Tireman & Colfax Bump & Repair Shop, 395 Mich 48; 232 NW2d 274 (1975). The question of intentional and wilful misconduct is a factual matter to be determined by the appeal board, which determination is conclusive. Day v Gold Star Dairy, 307 Mich 383; 12 NW2d 5 (1943).
The decision of the Workers’ Compensation Appeal Board is affirmed. Costs to claimant.
Effective January 1, 1982, the Legislature has amended the statute pertaining to mental disabilities. 1980 PA 357, MCL 418.301(2); MSA 17.237(301X2); MCL 418.401; MSA 17.237(401). We express no opinion as to the effect the amendment will have on the standard enunciated herein. See 60 Michigan Bar J, No 5, p 254 (May, 1981). | [
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V. J. Brennan, P.J.
Defendants appeal as of right from a judgment in favor of plaintiff entered on September 4, 1980, pursuant to an order denying defendants’ motion for leave to file a belated rejection of a mediation board’s evaluation and to set aside a judgment, entered on September 3, 1980, by Wayne County Circuit Court Judge Harry J. Dingeman.
Plaintiff’s complaint alleged that plaintiff was wrongfully discharged from his employment solely on the basis of his age. A notice of mediation was mailed to the attorneys of record setting the hearing for May 22, 1980. The mediation board unanimously evaluated plaintiff’s claim at $4,500. This notice was mailed to the attorneys on May 22, 1980. The notice stated that if the evaluation was not rejected within 40 days, it "shall be deemed to be accepted” and an appropriate judgment entered pursuant to Wayne County Court Rule 403 (WCCR 403). In a notice dated July 8, 1980, the mediation board notified both attorneys of record that the evaluation had been accepted by the failure to reject the evaluation as provided by rule 403.7(e) and, accordingly, a judgment was being entered pursuant to the provision of rule 403.15(a).
Shortly thereafter, defendants filed a motion for leave to file a belated rejection of the mediation board’s evaluation of plaintiffs claim and to set aside the judgment. The motion was heard on July 25, 1980. Counsel candidly admitted that he did not realize the Wayne County court rule had been amended to require written rejection and had proceeded under the old rule that a failure to accept amounted to a rejection. Counsel argued that he had not intended to accept the evaluation, especially since defendants believed plaintiffs claim had no value whatsoever. He stated that in "good conscience” the judgment should be set aside. The court took the matter under advisement. An opinion was filed on August 8, 1980, in which the court found that defendants inadvertently failed to reject the evaluation in accordance with WCCR 403.7(e) and then denied the motion, stating:
"Although there appear to be equitable considerations here which might be considered favorably by an appellate court, it is the opinion of this court that the local court rule provides it with no discretion in interpretation thereof.”
An order denying the motion was entered on September 3, 1980, and a judgment in favor of plaintiff was entered on September 4, 1980.
The issues on appeal require interpretation of the lower court’s discretion under primarily two court rules: Wayne County Court Rules 403.7(e) and 403.15(a), dealing with entry of judgment on an unrejected mediation evaluation, and GCR 1963, 528.3, dealing with relief from a final judgment.
On appeal, defendants argue that the lower court erred in finding that it had "no discretion in interpretation” of WCCR 403, and, consequently, that it was obligated to deny their motion to file a belated rejection and to enter final judgment on the mediation evaluation.
In this determination, we find no error. The language of WCCR 403 is clear and unambiguous in requiring written acceptance or rejection within 40 days and in providing that "a judgment will be entered” if the evaluation is not rejected. WCCR 403.7(e), 403.15(a). Defendants’ failure to respond to the mediation evaluation must be construed under the local court rule as substantively áccepting the evaluation. The policy of the rule is to expedite and simplify final settlement of cases. This Court concludes that the time limitatons operate to achieve these ends and that no party is prejudiced by a strict enforcement of the rule. Denial of the motion to file a belated rejection and entry of final judgment was therefore proper.
The foregoing determination, however, does not preclude automatically any possibility of relief from the resultant final judgment. GCR 1963, 528.3 provides broadly for discretionary relief from a final judgment upon any grounds that would establish the injustice of permitting the judgment to stand. This provision provides the mechanism by which the court is permitted to exercise its discretion in striking a balance between the desire to achieve finality and to remedy injustice.
GCR 1963, 528.3 provides in pertinent part that:
"On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; * * * (6) any other reason justifying relief from the operation of the judgment.”
We conclude that this subrule 528.3 was available to the court to enable it to make a discretionary decision on whether relief could be granted from the mediation final judgment. In short, the court had the power under GCR 1963, 528.3 to consider whether to grant or deny a motion for relief on the basis of the enumerated grounds.
Since the trial court can exercise its discretionary power under GCR 1963, 528.3, we reverse and remand for the court’s discretionary determination of whether counsel’s admitted unawareness of the necessity to send a written rejection within 40 days constitutes either mistake, inadvertence, surprise, excusable neglect, or a reason justifying relief from the operation of the judgment.
No costs on this appeal to either party. We retain no further jurisdiction. | [
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Per Curiam.
Plaintiff, owner of golf course property, contracted with defendant Golf Course Specialists, Inc., respecting the design of a golf course on plaintiff’s property. The contract was drafted by defendant William K. Newcomb, president of Golf Course Specialists, Inc., and signed by plaintiff. The contract included an arbitration clause as follows:
"(c) Arbitration
"All claims subject to arbitration under the Contract shall be promptly submitted to arbitration upon demand by either party to the dispute. It is mutually agreed that the decision of the arbitrators shall be a condition precedent to any right of legal action that either party may take against the other.
"Notice of demand for arbitration shall be in writing delivered in person or by certified or registered mail to the other party to the Contract. Simultaneously a copy shall be filed with the Landscape Architect. The notice of demand for arbitration shall be made within a reasonable time after the dispute but in no case shall such demand be made later than the time of final payment unless expressly stipulated otherwise in the Contract.
"The Contractor shall not cause a delay of the work during any arbitration proceedings except by agreement with the Owner.
"The procedure of arbitration shall be the standard form of arbitration procedure of the American Arbitration Association.”_
Defendant Golf Course Specialists, Inc., pursuant to the condition precedent language of the construction contract, demanded arbitration proceedings to recover contract retainages. Plaintiff participated in the arbitration proceedings and made claims for damages totaling in excess of $100,000. The arbitrator issued an award denying all of plaintiff’s claims and awarding defendant $32,889.50 plus interest.
Subsequent to the arbitrator’s award, plaintiff filed suit, alleging breach of contract by defendant Golf Course Specialists, Inc., fraud by the defendants in inducing plaintiff to enter the contract, and a claim of personal liability on the part of defendant Newcomb for the acts of the corporate defendant. Defendants’ counterclaim sought a confirmation of the arbitration award as a statutory arbitration, confirmation of the award as a common-law arbitration, and damages for breach of contract by plaintiff. The trial court confirmed the arbitration award and its opinion ultimately resulted in summary judgment in favor of defendant Golf Course Specialists, Inc., in the amount of the arbitration award, plus interest and dismissal of all plaintiff’s claims based upon an application of the holding of F J Siller & Co v City of Hart, 400 Mich 578; 255 NW2d 347 (1977). Plaintiff in this appeal urges this Court to find that the Siller holding was inappropriately applied by the trial court to "arrive at a correct interpretation of the parties’ intent in the particular circumstances of the case at bar”.
The Michigan Supreme Court in Siller v City of Hart, supra, Justice Ryan dissenting, held that statutory arbitration and common-law arbitration coexist in Michigan and that the "parties’ intent regarding the finality of arbitration should be ascertained by the usual rules of interpretation and given effect”. Siller, supra, 581. The arbitration clause in the Siller case read as follows:
" 'Both parties to this contract agree that as conditions precedent to the filing of an action in any court involving the amount or rate of payment or settlement for work performed by the contractor under these contract documents, and as a condition precedent to the liability of the owner for any amount other than contained in the estimates approved by the engineer shall be referred to arbitration for decision and award. The arbitrator or board of arbitration shall have authority only to pass upon questions involving compensation to the contractor for work actually performed but not allowed by the engineer, and its authority shall not extend to the interpretation of the plans and specifications or the determination of the qualities or materials or workmanship furnished, nor shall it have authority to set aside or modify the terms or requirements of the contract.’ ” Siller, supra, 580.
The Supreme Court reversed the Court of Appeals decision in Siller, 68 Mich App 265; 242 NW2d 547 (1976), which had held that the terms of the arbitration clause stating that arbitration that was a "condition precedent” to court action did not preclude post-arbitration court action. The Supreme Court, after noting the agreement of the parties to arbitrate and their agreement on the arbitrator, the site, and the procedure and manner of arbitration, as well as noting the extended period of time necessary for proofs to be presented, concluded:
"Yet, the Court of Appeals reading of the 'condition precedent’ language would deprive that provision and the arbitration hearing conducted of any effect. The plaintiff’s contention that the provision as construed retains effect by bringing 'the parties together in one room for a day’ and by being a 'valid tool for compromise’ is unconvincing. Arbitration would be just a warmup, binding on no one. Such a result is unreasonable in light of the rather extensive arbitration hearing held.
"A fair interpretation would be, and we so hold, that the parties intended the condition precedent language to preclude a court action regarding disputes within the scope of the arbitration clause independent of the award. Having agreed to arbitrate, plaintiffs remedy, if any, is limited to a challenge to the validity of the arbitration award; it may not contest ab initio in a court the merits of the contract dispute.” 400 Mich 581-582.
The arbitration clause in the instant case states:
"It is mutually agreed that the decision of the arbitrators shall be a condition precedent to any right of legal action that either party may take against the other.”
This language, agreed to by both parties, does not differ substantially from that use of the term "condition precedent” in Siller. We find that the trial court did not err in applying the rule enunciated by the Supreme Court in Siller to the facts and circumstances of the instant case.
The decision of the trial court is affirmed. Costs to defendants. | [
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] |
K. N. Sanborn, J.
On March 3, 1976, plaintiff Martin Fuhrmann, who was acting in his employment as a police officer for the City of Detroit, answered a call that an armed man had barricaded himself in a room at the Addison Hotel. During the course of this episode a police chaplain was killed when he was shot by the armed man, Chauncy West. Plaintiff sustained serious, permanent injuries when he, too, was struck by bullets from West’s gun.
Earlier, on July 1, 1975, West had allegedly set fire to a vacant house in Detroit. Following his arrest and arraignment on arson charges, West underwent psychiatric evaluation in the Detroit Recorder’s Court Psychiatric Clinic. Thereafter, doctors from that facility adjudged him to be mentally incompetent to stand trial.
On July 23, 1975, West was committed to the Center for Forensic Psychiatry. Upon being judged competent to stand trial, West was returned to Detroit, where he was found not guilty by reason of insanity. West was then returned to the Center for Forensic Psychiatry for another evaluation.
The second evaluation was done by defendants Hattaway and Koson, who were acting in their employment as psychiatrists at the center. Both psychiatrists certified that, while West was mentally ill, he was not dangerous to himself or to other persons. Upon receiving a notice from the Wayne County Prosecuting Attorney that no petition would be filed for a court hearing on West’s condition, the center released West on November 5, 1975. The shooting incident followed less than four months later.
The initial complaint in this matter was filed January 26, 1977, in Wayne County Circuit Court. Thereafter, by stipulation and court order, the center was dismissed from this case. The stipulation provided that, since plaintiffs’ action was against a state agency in tort, exclusive jurisdiction reposed in the Court of Claims.
On January 12, 1978, the circuit judge entered a stipulated order allowing plaintiffs to add Hattaway and Koson as parties defendant.
The plaintiffs asserted that defendants "did negligently release the defendant-decedent Chauncy West, who was then mentally deranged and suffering from severe mental illness and was dangerous to himself as well as to others”. It was claimed that, as a proximate cause of the defendants’ negligence, West shot Fuhrmann and occasioned his injuries.
The complaint specifically recites that defendants owed a general duty and that they breached the same in this case: (a) by releasing West with knowledge of his homicidal tendencies and of the threats he had made under such circumstances, (b) in failing to examine, diagnose and evaluate West before his release in accordance with the standard of practice in the community for psychiatrists, (c) in failing to keep West under observation for a sufficient period of time in order to properly diagnose his mental disorders, and (d) in failing to warn the proper authorities of West’s homicidal tendencies.
On February 28, 1980, Hattaway and Koson filed a motion seeking a summary judgment of dismissal in their favor pursuant to GCR 1963, 117.2(1). The motion was predicated upon three grounds: (a) that defendants were immune from liability under MCL 691.1407; MSA 3.996(107), (b) that the discretionary nature of their activity precluded a holding of liability against them, and (c) that they owed no duty to plaintiffs.
Following an extensive hearing on May 16, 1980, the circuit court granted the defendants’ motion. The present appeal was then filed.
The standard for review of summary judgments based on GCR 1963, 117.2(1), is well established. In citing this subrule, defendants charge that the plaintiffs’ complaint fails to state a claim upon which relief may be granted. The motion challenges the legal sufficiency of the complaint and must be evaluated with reference to the context of the complaint alone. All well-pleaded allegations of fact must be taken as true. The proper inquiry is whether the claims made are so clearly unenforceable as a matter of law that no factual development thereunder could possibly justify a right to recovery. Crowther v Ross Chemical & Manufacturing Co, 42 Mich App 426; 202 NW2d 577 (1972), and Bashara, The Elusive Summary Judgment Rule: Sifting Through the Maze, 1976 Det Col L Rev 396.
Analysis of the substantive issues in this case must be prefaced by noting that a burden rested upon the plaintiffs to plead facts in avoidance of governmental immunity. Butler v Wayne County Sheriff’s Dep’t, 75 Mich App 202; 255 NW2d 7 (1977), and Furness v Public Service Comm, 100 Mich App 365; 299 NW2d 35 (1980). Plaintiffs have attempted to surmount this hurdle in several ways.
It is claimed that defendants owed a special duty to Martin Fuhrmann, as a police officer, because of the frequency with which persons in his capacity would be expected to encounter individuals such as West. Plaintiffs have submitted no authority imposing a higher duty of care toward police officers than is required toward members of the public at large. In this absence, we are constrained to reject the theory upon the ground that it has been abandoned. Erdman v Yolles, 62 Mich App 594, 599; 233 NW2d 667 (1975).
A second issue concerns the scope of the aegis of governmental immunity in the case. There is little question that a state mental hospital is clothed with governmental immunity. In Perry v Kalamazoo State Hospital, 404 Mich 205, 214; 273 NW2d 421 (1978), Justice Moody, in concurring, stated that:
"The day-to-day care by an attendant, physician or other employee on the staff of a mental hospital represents a governmental function furthering the public need to segregate, treat and rehabilitate citizens suffering from mental disease who cannot otherwise care for themselves and who often are committed voluntarily or involuntarily through governmental action.
"Accordingly, as public mental hospitals perform an essentially unique activity mandated by legislative action, immunity must be extended as a governmental function under the statute. The proper planning and carrying out of this function can effectively be accom plished only by the government. The function is essentially governmental.”
The Center for Forensic Psychiatry was established pursuant to 1974 PA 258, § 128; MCL 330.1128; MSA 14.800(128). As part of the center’s duties, it must examine and evaluate the present mental condition of each person acquitted of a criminal charge by reason of insanity. The purpose of such examination and evaluation is to determine whether the person meets the criteria for a "person requiring treatment” under MCL 330.1401; MSA 14.800(401). This function is created by statute, is performed solely for governmental purposes and has no corresponding equivalent in the private sector. The Center for Forensic Psychiatry therefore performs a governmental function in such instances.
Likewise, the personnel employed by the center are acting within the scope of a governmental function. As such, they are cloaked with governmental immunity. Galli v Kirkeby, 398 Mich 527, 543, 544; 248 NW2d 149 (1976), Lockaby v Wayne County, 406 Mich 65, 84; 276 NW2d 1 (1979) (Moody, J., concurring in part, dissenting in part). This is particularly true in the present case. A contrary holding would result in the center facing extreme difficulty in hiring qualified personnel to perform the center’s statutorily appointed tasks and would vitiate the enabling statutes by indirection. This we cannot condone.
Perhaps in anticipation of the foregoing, plaintiffs have attempted to assert that defendants’ functions at the center were, at most, ministerial in nature. We do not agree.
The nature of ministerial functions is set forth in Cook v Bennett, 94 Mich App 93, 100; 288 NW2d 609 (1979), citing Wall v Trumball, 16 Mich 228, 234 (1867), which states that:
"A ministerial officer has a line of conduct marked out for him, and has nothing to do but to follow it; and he must be held liable for any failure to do so which results in the injury of another. A judicial officer, on the other hand, has certain powers confided to him to be exercised according to his judgment or discretion; and the law would be oppressive which should compel him in every case to decide correctly at his peril.”
Cook, supra, 100, goes on to state that:
"Discretionary acts are those of a legislative, executive or judicial nature. Sherbutte v Marine City, 374 Mich 48, 54; 130 NW2d 920 (1964). Ministerial acts are those where the public employee has little decision-making power during the course of performance, but rather his conduct is delineated.”
Plainly, the activities of the defendant psychiatrists are anything but ministerial. The decisions required of these persons are perhaps the ultimate in discretion. To determine the state of a person’s psyche is in itself a task requiring great discretion and when this task is conjoined with the even more imposing job of resolving another’s liberty, the consequent decision cannot be said to be "ministerial” in any sense of that word.
Plaintiffs strive to circumvent the claim of discretionary activity on defendants’ part by asserting that defendants’ negligent failure to follow prescribed procedures resulted in their actions being only ministerial in nature. This argument is not supported by citations of authority. The argument is abandoned. Erdman, supra.
Finally, there seems to be little doubt that medi cal decision-making is inherently discretionary. O’Toole v Fortino, 97 Mich App 797, 811; 295 NW2d 867 (1980). This, again, is particularly true in the field of psychiatry.
Based on the foregoing, it is readily apparent that summary judgment of dismissal was properly awarded in this instance.
Affirmed. No costs, a public question being involved. | [
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] |
Per Curiam.
Plaintiffs brought this action for declarátory judgment on the constitutionality of 1981 PA 60, which amends portions of the City Income Tax Act, MCL 141.501 et seq.; MSA 5.3194(1) et seq., and to invalidate a one percent increase in the City of Detroit income tax on nonresidents imposed pursuant to that act, MCL 141.503; MSA 5.3194(3). The Wayne County Circuit Court entered summary judgment for defendant and plaintiffs appealed. Defendant has filed a motion to affirm pursuant to GCR 1963, 817.5(3).
Plaintiffs contend that 1981 PA 60 violates the Headlee amendment to the constitution, Const 1963, art 9, §§ 25-34, because it allows an increase in the nonresident income tax rate without the "direct voter approval” of nonresidents, allegedly as required by Const 1963, art 9, § 25. Properly interpreted, plaintiffs argue, Headlee, § 25, requires approval of a tax increase by the taxpayers affected by the increase. Defendant argues that Headlee, § 31, controls and that it was satisfied by a majority vote of the qualified electors of the City of Detroit, i.e., the unit of local government which sought to increase the rate of the existing income tax.
We are persuaded that defendant’s position is correct. Headlee, §25, states a general purpose, but, by its own terms, is implemented by the sections which follow, including § 31. Headlee, § 25, states:
"Implementation of this section is specified in Sections 26 through 34, inclusive, of this Article.”
The meaning of the phrase "direct voter approval” in § 25 therefore is specified in § 31 and requires only the "approval of a majority of the qualified electors of that unit of Local Government voting thereon”. Since § 25 expressly takes its meaning from the sections which follow, no further construction or interpretation of the phrase "direct voter approval” is required.
Plaintiffs also contend that 1981 PA 60 violates equal protection quarantees by denying them the right given by the Headlee amendment to vote on an increase in the income tax for nonresidents. We reject this contention because, as we concluded above, the Headlee amendment gives no such right to vote. Absent such a right, the city properly may impose a tax on the income of nonresidents. See Dooley v Detroit, 370 Mich 194; 121 NW2d 724 (1963), 71 Am Jur 2d, State and Local Taxation, § 472, pp 774-777, Anno: Validity of municipal ordinance imposing income tax or license upon nonresidents employed in taxing jurisdiction (commuter tax), 48 ALR3d 343.
Next, plaintiffs argue that 1981 PA 60 violates that part of Const 1963, art 4, § 24, which provides: "No bill shall be altered or amended on its passage through either house so as to change its original purpose as determined by its total content and not alone by its title.” Plaintiffs argue that 1981 PA 60 is substantially different from original House Bill No. 4541 and from the original City Income Tax Act because it provides for approval of a tax increase by qualified electors, for the sale of fiscal stabilization bonds, for employee wage and salary concessions, and for certification by the state administrative board.
We reject the contention. Const 1963, art 4, § 24 is not offended if the substitute bill or amendment is for the same purpose as the original bill, if the substitute or amendment is in harmony with the objects and purposes of the original bill and germane thereto. United States Gypsum Co v Dep’t of Revenue, 363 Mich 548; 110 NW2d 698 (1961), Moeller v Wayne County Board of Supervisors, 279 Mich 505; 272 NW 886 (1937).
In this case, the final version of House Bill No. 4541 and 1981 PA 60 are in harmony with and germane to the purposes of the original City Income Tax Act, which was, as expressed in its title, an act designed, inter alia, "to permit the imposition and collection by cities of an excise tax levied on or measured by income; to provide the procedure including referendums for” and "to limit the imposition and collection by cities and villages of excise taxes levied on or measured by income”.
Finally, plaintiffs contend that 1981 PA 60 violates the title-object clause of Const 1963, art 4, § 24 that "[n]o law shall embrace more than one object, which shall be expressed in its title”. Plaintiffs argue that the title of the City Income Tax Act fails to give notice to the provisions in 1981 PA 60 for the issuance of fiscal stabilization bonds, employee wage and salary agreements, and concessions and certification by the state administrative board.
The title of an act is not required to be an index of all of its provisions. Midland Twp v State Boundary Comm, 401 Mich 641; 259 NW2d 326 (1977), People v Milton, 393 Mich 234; 224 NW2d 266 (1974). As the Supreme Court said in Loomis v Rogers, 197 Mich 265, 271; 163 NW 1018 (1917):
"An abridgment of all those sections is not essential to a sufficient title. While it contains various related provisions not directly indicated or enumerated in the title, under the construction of this constitutional requirement, as many times reviewed by this court, if the act centers to one main general object or purpose which the title comprehensively declares, though in general terms, and if provisions in the body of the act not directly mentioned in the title are germane, auxiliary, or incidental to that general purpose, the constitutional requirement is met.”
The several new provisions in 1981 PA 60, though not enumerated in the title of the City Income Tax Act, are nevertheless germane, auxiliary, or incidental to the purpose of that act "to provide the procedure” for imposing and collecting an income tax and "to limit the imposition and collection by cities and villages of excise tax levied on or measured by income”. In particular, 1981 PA 60 is not defective because the title to the City Income Tax Act fails to disclose the role of the state administrative board. As the Supreme Court said in Midland Twp, supra, 654:
"Whether a provision is germane depends on its relationship to the object of the act, not who is charged with implementing the provision. Although an act centers on the functioning of city government and its title so indicates, it is not consequential for purposes of the Title-Object Clause whether a city, county or state official or agency is charged by the act with participation in implementation of a provision of the act as long as the provision to be implemented is germane to the functioning of city government.”
The circuit court properly granted defendant’s motion for summary judgment. Defendant’s motion to affirm is granted. This Court will not entertain an application for rehearing. GCR 1963, 801.3, 820.1(7).
Affirmed. | [
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] |
D. C. Riley, J.
Plaintiff, Bonnie Lee Carnes, appeals as of right from a judgment rendered by a Wayne County Circuit Court judge denying her request for an equitable division of property held by defendant, Charles D. Sheldon, and denying her request for the custody of defendant’s minor child, Mary Ellen Sheldon.
Prior to 1967, defendant was married to Constance Sheldon (now Constance Ward). Of this marriage four children were born, one of whom is Mary Ellen, the subject of the present custody dispute. Constance left defendant in 1967 and did not take the children with her. Shortly thereafter, defendant became acquainted with plaintiff, who was also separated from her husband, and who was the mother of three children. In May, 1967, plaintiff and two of her children moved into defendant’s house with defendant and his children. The move was prompted by plaintiff’s need for a place to live and defendant’s need for someone to care for his children. In 1968, defendant obtained a divorce from his wife and was granted custody of all four children.
Plaintiff was unemployed at the time she moved in with defendant and remained so until September, 1970, when she worked part-time as a school bus driver. In 1972, her status was that of a full-time driver. For the most part, plaintiff continued at this job from 1972 through 1979, either part- or full-time, although she did not collect unemployment compensation for the 1974-1975 school year.
At about the time plaintiff began working in 1970, the defendant bought a new home into which plaintiff, defendant, and the children moved. According to plaintiff, defendant had been anxious about the bills which would accompany the purchase of a new home and that she obtained her job in order to help pay the bills so as to quell defendant’s anxieties. Plaintiff testified that her wages, which she received biweekly, were used to pay utilities and to purchase food. She then would give the balance to defendant, who, in turn, would tender back to plaintiff an amount sufficient to cover the next week’s bills. Plaintiff testified that she does not know what defendant did with the money left over.
Plaintiff testified that from the beginning, and at various times during her relationship with defendant, she was told by defendant that they would get married as soon as her divorce from Mr. Carnes was final. Plaintiff’s divorce, funded by defendant, was obtained some time in 1977. Plaintiff testified that defendant changed his story after her divorce, saying that she was "rusing” him and that he did not trust her. Defendant’s refusal to marry her ultimately led to the demise of the relationship.
At first, plaintiff testified that she and defendant never held discussions pertaining to a division of property between them. Later she testified that, while there had been discussions on this subject, there was never any agreement that any of the property they accumulated would be divided between herself and defendant. She testified that "[h]e’s always felt everything was his and nothing was mine * * *”.
In addition, plaintiff testified that at the children’s school she was known as Bonnie Sheldon and that the school principal referred to her as Sheldon. Defense counsel, however, produced a letter from the school principal addressed to Mrs. Bonnie Carnes. Plaintiff’s driver’s license and social security card were in the name of Carnes, and the parties’ tax returns were filed separately. Plaintiff’s bank accounts were in her name only. Plaintiff made no payments on the house, which was in defendant’s name only. Defendant had a credit card, but plaintiff did not have access to it. Although defendant sometimes purchased items for plaintiff using the card, he told her that she would have to reimburse him for the cost of purchasing such items.
Defendant testified that there was no agreement to share his property with plaintiff and that he never promised to place title to any of his property in her name. According to defendant, throughout their relationship he always told plaintiff that he "couldn’t see getting married because I couldn’t see a woman changing her mind and taking half of what you own just because she decides she don’t want you anymore * * Defendant testified that plaintiff offered to go to a lawyer to sign an agreement stating that she would receive no property in the event of a divorce. Plaintiff admitted that she made this offer.
On April 24, 1979, plaintiff filed the instant suit, seeking an equitable division of the property accumulated during the years she and defendant lived together and seeking custody of Mary Ellen Sheldon.
The trial judge granted custody of the child to its natural mother, Constance Ward. With respect to her claim for an equitable distribution of property, the court held that plaintiff had failed to sustain her burden of proving that an express agreement existed between the parties regarding the ownership of personal and real property accumulated during their years of unmarried cohabitation. The court noted that plaintiff’s claim of an express agreement was based in part on asserted promises by the defendant to marry (and thus share property accumulated from joint efforts) in the future. The trial court found that defendant did not make such a promise and on this point found defendant’s testimony credible. Further, the court denied recovery on plaintiff’s implied con tract theory holding that implied contracts in this setting have been neither recognized by case law nor authorized by the Legislature.
Plaintiff first argues that the lower court’s finding that plaintiff failed to prove the existence of an express agreement is "contrary to the evidence”. Since this issue concerns the weight of the evidence, it has not been properly preserved for appeal because plaintiff did not file a motion for a new trial.
" 'Under GCR 1963, 527.1, where the losing party claims that a verdict of a jury or decision of a judge is against the great weight of the evidence he may raise that claim by a motion for a new trial. Such a motion is addressed to the discretion of the trial judge and, accordingly, if such a motion is not filed, such a claim is not preserved for appellate review.’ ” Arnsteen v U S Equipment Co, 52 Mich App 177, 179; 217 NW2d 61 (1974), quoting Arnsteen v U S Equipment Co, 390 Mich 776 (1973).
Furthermore, our review of the record convinces us that the trial court’s findings of fact are supported by the evidence. This Court will not substitute its own judgment on factual questions in a nonjury case for that of the trial court unless the facts clearly indicate that an opposite result must be reached. In re Leonard Estate, 45 Mich App 679; 207 NW2d 166 (1973), GCR 1963, 517.1. In the instant case we cannot say that the judge should have reached an opposite result. Plaintiff so much as admitted during trial that there was no express agreement with respect to a division of property. In addition, plaintiff’s credibility on this issue seriously was weakened by her contradictory and equivocal testimony. For all these reasons, we reject plaintiff’s contention that she proved an express agreement at trial.
Alternatively, plaintiff contends that the evidence supports recovery on the basis of either a contract implied in law or implied in fact.
By statutory enactment in Michigan, common-law marriages are valid only if contracted before January 1, 1957. MCL 551.2; MSA 25.2, People v Stanford, 68 Mich App 168; 242 NW2d 56 (1976). Since that time, Michigan has refused to recognize such marriages with the result that the property rights afforded a legally married couple have not been extended to those engaged in meretricious relationships. Michigan has also abolished the civil cause of action for breach of contract to marry. MCL 551.301; MSA 25.191.
This state will not enforce contracts made in consideration of meretricious relationships. In Tyranski v Piggins, 44 Mich App 570; 205 NW2d 595 (1973), however, this Court recognized that the existence of a meretricious relationship does not render all agreements between the parties illegal. In Tyranski, supra, 573-574, the Court said:
"But where there is an express agreement to accumulate or transfer property following a relationship of some permanence and an additional consideration in the form of either money or of services, the courts tend to find an independent consideration.”
To the extent the rule announced in Tyranski concerns an express oral agreement entered into during the course of a meretricious relatiosnhip, it is inapplicable to plaintiff’s implied contract claim.
With respect to implied contracts, only one case in Michigan has recognized a cause of action based upon a contract implied in fact in the context of a meretricious relationship. In Roznowski v Bozyk, 73 Mich App 405; 251 NW2d 606 (1977), the defendant owned and managed a resort which had a tavern on its premises. The plaintiff previously had worked as a cocktail waitress in other local establishments but in 1968 moved into defendant’s home, whereupon the parties began living together as husband and wife. She aided the defendant in operating his resort, including painting and cleaning the cabins and working in the bar. In addition, plaintiff performed most of the domestic chores in the home. In return, the defendant paid all of their expenses, including upkeep of their home, the plaintiff’s insurance premiums, car payments, clothing, food, and medical bills.
In 1974, the relationship deteriorated, the parties split up, and plaintiff commenced suit claiming wages under an alleged express contract of employment entered into at the time she moved in with the defendant. She also sought recovery for the value of the services received by the defendant on a theory of implied contract. The trial court found that the plaintiff had not proved an express contract and further found that an employer-employee relationship did not exist. The court did find that the defendant was benefited by the plaintiff’s services in connection with his tavern business and that she was entitled to recover for this. The trial court, significantly, excluded the plaintiff’s claim for services rendered in the home, finding that these were gratuitous. See, generally, Anno: Recovery for services rendered by persons living in apparent relation of husband and wife without express agreement for compensation, 94 ALR3d 552.
On appeal, the defendant argued that, absent proof of an express agreement, the services rendered by plaintiff must be presumed to have been gratuitous. This Court disagreed, stating that the presumption of gratuity may be rebutted where it is established that when the services were rendered the plaintiff expected to receive and the defendant expected to pay wages therefor. The Court held that in order to recover the plaintiff must establish a contract implied in fact, which requires proof of the expectations of the parties.
"Without proof of the expectations of the parties, the presumption of gratuity will overcome the usual contract implied by law to pay for what is accepted. Weessies v Van Dyke’s Estate, 159 Mich 180, 183; 123 NW 608 (1909). Cf. King v First Michigan Bank & Trust Co of Zeeland, 11 Mich App 144; 160 NW2d 721 (1968). The issue is a question of fact, to be resolved by consideration of all of the circumstances, including the type of services rendered, duration of services, closeness of relation of the parties, and the expressed expectations of the parties.” Roznowski, supra, 409.
The Court held that there was more than sufficient evidence to present a question of fact as to the parties’ expectations and, therefore, granted the plaintiff a new trial. As noted, the trial court had excluded the plaintiff’s claim for services rendered in the home as gratuitous, and this Court did not alter that exclusion.
Roznowski establishes a theory of recovery pursuant to a contract implied in fact under circumstances similar to those in the instant case. Roznowski is distinguishable from the instant case for several reasons, however. There the plaintiff sued for wages or for the value of services rendered, whereas, in the instant case, plaintiff does not ask for wages and has not alleged that she expected them. In addition, the Roznowski Court did not extend the principles of contracts implied in fact to household services. The plaintiff was allowed to recover only for services of a commercial nature. In the instant case, plaintiffs services to defendant were only of a household nature.
The courts of this state have been willing to grant equitable relief, in certain circumstances, to putative spouses. In cases involving putative spouses, one or both of the parties mistakenly believe in good faith that they are legally married, only to discover at a subsequent date that they are not. In Walker v Walker, 330 Mich 332, 335; 47 NW2d 633 (1951), the Court announced the principle that in the putative spouse situation a concealment of material facts by one spouse may constitute actionable fraud and permit the defrauded spouse to recover a portion of the property accumulated during the period of cohabitation.
In the instant case, despite the fact that plaintiff concedes that both parties knew that they were not married legally to each other, she argues that there was fraud present here because defendant promised to marry her but refused to do so. We reject this contention for several reasons. First, the trial court’s finding that defendant did not promise to marry plaintiff is supported by the evidence. Second, plaintiffs unilateral expectation of marriage cannot be attributed to the defendant as a fraudulent act on his part. Third, the parties were not putative spouses. Finally, plaintiff is essentially asking for relief based on a breach of promise to marry, an action which has been specifically abolished by legislative fiat.
Further, plaintiff asks us to fashion remedies implied in law, similar to those suggested by the California Supreme Court in the now famous case of Marvin v Marvin, 18 Cal 3d 660; 134 Cal Rptr 815; 557 P2d 106 (1976), where the court suggested that the judiciary should begin formulating remedies appropriate to nonmarital relationships based on the presumption that cohabitants intend " 'to deal fairly with each other’ Id., 683. The court held that, in the absence of an express agreement, the courts should inquire into the conduct of the parties to determine whether the conduct demonstrates an implied contract, an agreement of partnership or joint venture, or some other tacit understanding of the parties. The court further held that remedies such as quantum meruit, constructive trusts, or resulting trusts may be employed in the context of unmarried cohabitants.
The trial court, in the case at bar, held that Michigan does not allow such recovery and further held that it would be against the public policy of this state to do so. We agree with the trial judge.
In a New York decision, McCullon v McCullon, 96 Misc 2d 962; 410 NYS2d 226, 231 (1978), the court, in discussing Marvin, stated as follows:
"As Justice Tobriner stated in his decision, the Marvin discussion was not intended to equate unmarried cohabitation with married couples or create common law marriage. What Marvin did was give the nonmarital partners, 'the same rights to enforce contracts and to assert her equitable interest in property acquired through her effort as does any other unmarried person. ’ ” (Emphasis in orgiinal.)
In a recent Illinois decision, Hewitt v Hewitt, 77 Ill 2d 49, 57-58; 394 NE2d 1204 (1979), the Illinois Supreme Court, in a well-written and comprehensive opinion, stated the problem somewhat differently:
"The issue of unmarried cohabitants’ mutual property rights, however, as we earlier noted, cannot appropriately be characterized solely in terms of contract law, nor is it limited to considerations of equity or fairness as between the parties to such relationships. There are major public policy questions involved in determining whether, under what circumstances, and to what extent it is desirable to accord some type of legal status to claims arising from such relationships. Of substantially greater importance than the rights of the immediate parties is the impact of such recognition upon our society and the institution of marriage. Will the fact that legal rights closely resembling those arising from conventional marriages can be acquired by those who deliberately choose to enter into what have heretofore been commonly referred to as 'illicit’ or 'meretricious’ relationships encourage formation of such relationships and weaken marriage as the foundation of our family-based society? In the event of death shall the survivor have the status of a surviving spouse for purposes of inheritance, wrongful death actions, workmen’s compensation, etc.? And still more importantly: what of the children born of such relationships? What are their support and inheritance rights and by what standards are custody questions resolved? What of the sociological and psychological effects upon them of that type of environment? Does not the recognition of legally enforceable property and custody rights emanating from nonmarital cohabitation in practical effect equate with the legalization of common law marriage * * *?”
We are of the opinion that public policy questions of such magnitude are best left to the legislative process, which is better equipped to resolve the questions which inevitably will arise as unmarried cohabitation becomes an established feature of our society. While the judicial branch is not without power to fashion remedies in this area, see, e.g., Tyranski, supra, Roznowski, supra, and Walker, supra, we are unwilling to extend equitable principles to the extent plaintiff would have us do so, since recovery based on principles of contracts implied in law essentially would resurrect the old common-law marriage doctrine which was specifically abolished by the Legislature. Although, as previously noted, the Marvin court denied that the effect of its decision would be to resurrect the principle of common-law marriages, commentators have been less certain. Quoting from Hewitt, supra, 65-66:
" '[T]he effect of these cases is to reinstitute common-law marriage in California after it has been abolished by the legislature.’ (Clark, The New Marriage, Williamette LJ 441, 449 (1976). [Hewitt] is, if not a direct resurrection of common-law marriage contract principles, at least a large step in that direction.’ Reiland, Hewitt v Hewitt: Middle America, Marvin and Common-Law Marriage, 60 Chi B Rec 84, 88-90 (1978).”
In conclusion, we concur with the trial judge’s ruling that judicial restraint requires that the Legislature, rather than the judiciary, is the appropriate forum for addressing the question raised by plaintiff. We believe a contrary ruling would contravene the public policy of this state "disfavoring the grant of mutually enforceable property rights to knowingly unmarried cohabitants”. Hewitt, supra, 66.
The other issue on appeal is whether the trial court erred in its decision to award the custody of Mary Ellen to Constance Ward. Defendant had been granted custody of Mary Ellen following his divorce from Constance in 1968. Plaintiff moved in with the Sheldon family in 1968 and raised Mary Ellen since the child was three years old. Following the taking of testimony from all interested witnesses, including Constance Ward, the trial judge granted a change of custody to Constance Ward.
Once a judge has entered a child custody order, he should not modify or amend the award "unless there is presented clear and convincing evidence that it is in the best interest of the child”. MCL 722.27(c); MSA 25.312(.7)(c). (Emphasis added.) To determine the best interest of the child, a trial court is required to analyze and make findings of fact on the specific factors enunciated under the Child Custody Act, MCL 722.23; MSA 25.312(3), Cooper v Cooper, 93 Mich App 220, 226; 285 NW2d 819 (1979), Troxler v Troxler, 87 Mich App 520, 523; 274 NW2d 835 (1978).
This Court reviews child custody cases de novo. Bahr v Bahr, 60 Mich App 354, 360; 230 NW2d 430 (1975), Outcalt v Outcalt, 40 Mich App 392, 394; 198 NW2d 779 (1972). This independent review is meaningful, however, only if the lower court has made proper findings of fact and conclusions of law. Lewis v Lewis, 73 Mich App 563, 566-567; 252 NW2d 237 (1977), Hilbert v Hilbert, 57 Mich App 247, 250-251; 225 NW2d 697 (1974). Where the trial court specifically makes findings for each of the factors comprising the best interests of the child and the trial judge has not found against the great weight of the evidence or committed a palpable abuse of discretion, this Court will affirm. Troxler, supra, MCL 722.28; MSA 25.312(8).
A review of the instant record discloses that, while the trial court recognized the statutory requirement that it make findings under the Child Custody Act, it failed to do so, at least with respect to most of the factors.
In Lewis, supra, 567, this Court discussed the various remedies available where a trial court fails to make adequate findings of fact on the "best interest” factor:
"Where the trial court has failed to analyze the issue of child custody in accord with the mandates of MCLA 722.23; MSA 25.312(3) and to make reviewable findings of fact under GCR 1963, 517.1, the proper remedy is to remand for a new child custody hearing. Zawisa v Zawisa [61 Mich App 1; 232 NW2d 275 (1975)]. While in other cases it may suffice to remand for explication of the trial court’s decision, cf. Ray v Mason County Drain Comm’r, 393 Mich 294, 303; 224 NW2d 883, 886 (1975), the record indicates that the circumstances of the parties may have changed since entry of the custody order. We therefore determine that a new hearing is appropriate.”
Therefore, we must remand this case for a new child custody hearing at which time the parties shall be allowed to introduce additional evidence pertaining to the custody issue. Following the hearing, the court shall make specific findings on each of the statutory factors relating to the best interests of the child. We believe that it is in the best interest of the child to hold a prompt hearing on her custody within 60 days from the date of release of this opinion.
Remanded. We retain jurisdiction.
Costs to abide the outcome. | [
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Per Curiam.
Plaintiff, Lonnie Hawkins, testified as a witness in a criminal trial held on January 26, 1976. He was at that time and still is incarcerated at Southern Michigan Prison. On May 18, 1976, defendant, James M. Justin, who was an assistant prosecutor for Jackson County at that time, wrote a letter to the warden of Southern Michigan Prison in which he stated that the plaintiff appeared to have actively committed perjury during his testimony at trial.
This letter was placed in plaintiffs prison file and, on October 4, 1978, pursuant to the Freedom of Information Act, MCL 15.231 et seq.; MSA 4.1801(1) et seq., plaintiff petitioned to examine his file. On October 3, 1979 (approximately one month after plaintiff had sought a retraction from defendant), plaintiff filed a libel action against defendant based on the letter that defendant wrote to the warden.
Following a hearing, the trial court> entered accelerated judgment in favor of the defendant based upon two findings pertinent to this appeal: (1) that the one-year statute of limitations applicable to libel actions had run and barred plaintiffs suit (MCL 600.5805[7]; MSA 27A.5805[7] [as amended by 1978 PA 495], MCL 600.5827; MSA 27A.5827), and (2) that MCL 600.5851; MSA 27A.5851, which tolls the statute of limitations for incarcerated persons, constituted a denial of equal protection and thus was unconstitutional. This Court granted plaintiffs delayed application for leave to appeal.
We have consolidated the several issues stated by the parties into the following question: Did the trial court err in ruling that the tolling provision of MCL 600.5851; MSA 27A.5851, which extends the limitations period for persons who are incarcerated when a cause of action accrues, was unconstitutional as a denial of equal protection and thus did not prevent the statute of limitations from running against plaintiff in this libel action?
There is no dispute that this libel action is governed by a one-year statute of limitations, MCL 600.5805(7); MSA 27A.5805(7). The period of limitations runs from the time the claim accrues which in the case of libel is from the time of publication even though the person defamed has no knowledge thereof until sometime afterwards. MCL 600.5827; MSA 27A.5827. Grist v The Upjohn Co, 1 Mich App 72; 134 NW2d 358 (1965).
In the instant case, where publication occurred on May 18, 1976 (the day that the alleged libelous letter was written), the period of limitations began to run on that date and plaintiffs cause of action was barred by the statute on May 18, 1977. Therefore, unless some exception applied, plaintiffs failure to bring suit prior to May 18, 1977, barred his cause of action against defendant.
Plaintiff claims error in the trial court’s refusal to apply MCL 600.5851; MSA 27A.5851, a statutory provision which tolls the statute of limitations in favor of persons imprisoned at the time of the accrual of their cause of action. The basis for the trial court’s refusal to apply this statute was its finding that the statute was unconstitutional as a denial of equal protection. The statute provides in pertinent part:
"(1) If the person first entitled to make an entry or bring an action is under 18 years of age, insane or imprisoned at the time his claim accrues, he or those claiming under him shall have 1 year after his disability is removed through death or otherwise, to make the entry or bring the action although the period of limitations has run. This section does not lessen the time provided in section 5852.
"(3) To be deemed a disability, the infancy, insanity or imprisonment must exist at the time the claim accrues. If it comes into existence after the claim has accrued it shall not be recognized under this section for the purpose of modifying the period of limitations.”
The scope of judicial review of equal protection challenges to socioeconomic legislation was stated in O'Brien v Hazelet & Erdal, 410 Mich 1, 13; 299 NW2d 336 (1980), as follows:
"Under traditional equal protection analysis, a legislative classification must be sustained, if the classification itself is rationally related to a legitimate governmental interest.” (Quoting Shavers v Attorney General, 402 Mich 554, 612-613; 267 NW2d 72 [1978].)
We first must identify the governmental interest underlying this challenged statute and the objective which this legislation sought to achieve. Our review persuades us that the purpose of the statute in question is to recognize that persons in prison are under a disability in that their freedom has been restricted and their access to the judicial process has been impaired and to provide such persons with additional time to assert their legal rights. There is no question that the Legislature had the power to enact this statute and determine the conditions under which a right may accrue and the period in which a right may be asserted. O'Brien, supra.
Defendant correctly argues that prisoners today are generally less isolated and less restricted than they were historically. Certainly the increased right to counsel, the right to have transcripts to trial records, and the access to law libraries have rendered prisoners much less isolated and restricted. This fact alone, however, does not render the statute unconstitutional. The Legislature still could have determined rationally that prisoners are more restricted than ordinary citizens and thus in need of the special protection afforded by the statute. The Legislature reasonably could have found that, notwithstanding the ability of prisoners to obtain legal counsel and have access to the judicial process, they still have restraints imposed by their confinement which places them at a disadvantage compared to ordinary citizens.
We also find it worthy of note that this statute has been reviewed by the Legislature in 1961 and as recently as 1972, when it was amended. In fact, it appears from the Committee Comment, MCLA 600.5851, p 914, that the changing circumstances of prisoners was recognized and considered in revising the statute. The comment states:
"Section 5851 is based on §§ 609.5, 609.6 and 609.15 of CL 1948. However, the present law is changed substantially. The period in which an action can be brought after a disability has been removed has been reduced from the present £ve years for real actions, and the present period of original limitation in personal actions, to one year for all actions. At the present time infants and insane persons are able to bring actions through their guardians and even prisoners can bring civil actions, though they may not be allowed to be personally present, so it is not as necessary to provide long periods after the removal of the disability in which to sue as it was in the past when these disabilities were considerably more real. Nevertheless, it was considered better to allow a short period after the termination of the disability in which the person under the disability could bring an action.” (Emphasis added.)
It appears to us from our review that the purpose of the statute is to provide prisoners with additional time to assert their legal rights and this purpose could reasonably be based upon the fact that prisoners have restricted access to the judicial system due to their confinement. For this reason, we conclude the trial court erred in finding MCL 600.5851; MSA 27A.5851 unconstitutional as a denial of equal protection.
Alternatively, defendant argues that the statute should not be applied generally but only in specific instances of disability and relies upon the following specific language of the statute:
"* * * the person * * * imprisoned * * * shall have 1 year after his disability is removed through death or otherwise, to * * * bring the action * * *.”
We disagree and would interpret the word "otherwise” as referring to the prisoner’s release from prison. Further, absent more specific language indicating the statute should be applied on a case-by-case basis, we hold it should be applied generally to all prisoners. Nor, in this regard, do we deem the fact that plaintiff brought suit while still in prison to have any effect upon our interpretation. See 51 Am Jur 2d, Limitation of Actions, § 181, p 749, § 192, p 760.
We are persuaded that the language of the statute provides for a disability in favor of all who are incarcerated when a cause of action accrues and does not require a showing of a special disability. We thus hold the statute applicable to the instant case and reverse the decision of the trial court.
Reversed and remanded for trial. No costs. | [
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Beasley, J.
Plaintiff, Raymond W. Hill, filed a complaint, pursuant to MCL 600.2932; MSA 27A.2932, to quiet title to property located in the Township of Houghton, County of Keweenaw, naming the township and county as defendants. Plaintiff claimed title through adverse possession and alleged that his predecessors had openly, notoriously, continuously, and with a claim of right possessed the disputed property in excess of 90 years.
The property in question was located within a block designated as a "public square” in the plat, recorded in 1855, of the Village of Eagle River. Following hearings, the trial court granted defendants’ motion for summary judgment pursuant to GCR 1963, 117.2(1), stating:
"The Court is of the opinion that the plaintiffs claim of title under the Michigan Marketable Title Act is excepted by that Act, being Section 4 of the act, and also plaintiff’s claim under the theory of adverse possession is not applicable to property owned by a municipality.
"The Court is also of the opinion that plaintiffs suit to quiet title, although it does not state in so many words, is an attempt to amend a duly recorded plat and fails to comply with the requirements of the Michigan Plat Act * *
In reviewing a grant of summary judgment under GCR 1963, 117.2(1), this Court assumes that the factual allegations in a plaintiffs complaint are true and, then, determines whether the plaintiffs claim, on the pleadings, is so clearly unenforceable as a matter of law that no factual development can permit recovery.
The general rule is that an adverse possession claim may not be made against a governmental entity, except where there is statutory authority. Plaintiff does not dispute this general rule, but rather, suggests that the rule is the product of certain statutes first enacted in 1907. Since plaintiff alleged that his predecessors in title had been in open, notorious, and exclusive possession for 15 years prior to 1907, plaintiff argues that a proper adverse possession claim was asserted. Historical review of the applicable statutes indicates that plaintiff’s contention is correct.
In Pastorino v Detroit the Supreme Court noted that the "immunity” of governmental entities from adverse possession claims was first established in this state by 1907 PA 46. The Court noted that prior to the enactment of this statute, Michigan followed the minority position that ad verse possession could be established against a municipal entity.
The Supreme Court agin considered a municipal corporation’s "immunity” against adverse possession claims in Howard v Village of Berrien Springs. In Howard, the original plat of the Village of Berrien Springs dedicated certain land "to remain open and free for the benefit of the public”. The plaintiff in Howard claimed title to a portion of this land through adverse possession by herself and her predecessors in title. She brought a bill to quiet title in her favor, which bill was dismissed by the trial court. The Supreme Court reversed the trial court by finding that plaintiff was successful in establishing adverse possession 15 years before the effective date of 1907 PA 46. The Supreme Court concluded:
"It appears from the evidence that the adverse possession by plaintiff and her predecessors in title was actual, continued, visible, notorious, distinct and hostile. Under the record plaintiff has a right to have her title quieted as to any claim of defendant village in the premises.”
We find the Howard decision controlling in the case at bar and conclude that the lower court erred in granting defendants’ motion for summary judgment. Plaintiffs amended complaint made an adverse possession claim and specifically alleged that he was in privity with his predecessors in title. A private party can maintain a successful adverse possession case against a municipal entity if the adverse possession took place prior to 1907.
We additionally note that defendants were not entitled to an accelerated judgment pursuant to GCR 1963, 116.1(1). The trial court ruled, in the alternative, that it lacked jurisdiction since plaintiff had failed to comply with the requirements of the Michigan Plat Act. Plaintiff’s complaint did not invoke the Plat Act and plaintiff, therefore, was not required to comply with any of the act’s prerequisites before bringing suit.
In so holding, we do not intend to preclude defendants from asserting, as an affirmative defense, alleged application of and noncompliance with the Michigan Subdivision Control Act of 1967 and, particularly, §§ 221-228.
Defendants also argued that, in his complaint, plaintiff made indirect reference to the marketable record title act by asserting a chain-of-title extending over 40 years. Then defendants asserted, as an affirmative defense, that the marketable record title act was, by its terms, inapplicable to them.
As indicated, in granting defendants’ motion for summary judgment and/or accelerated judgment, the trial court stated that it did not believe that the marketable record title act applied to governmental agencies such as these defendants. While we agree that the marketable record title statute does not affect rights in land of either the federal government, the state government, or their respective agencies, we do not believe that the marketable record title act was intended to preclude successful assertion of a claim based on adverse possession. Our holding on appeal is not based upon the applicability or inapplicability of the marketable record title act.
In summary, we reverse the award of summary judgment and/or accelerated judgment to defendants and remand this case for trial on the merits consistent with this opinion.
Reversed and remanded.
Rubino v City of Sterling Heights, 94 Mich App 494, 497; 290 NW2d 43 (1979).
Caywood v Dep’t of Natural Resources, 71 Mich App 322, 327-328; 248 NW2d 253 (1976).
182 Mich 5; 148 NW 231 (1914).
See, 1907 PA 46, 1915 PA 314, CL 1948, § 609.1, MCL 600.5821; MSA 27A.5821.
311 Mich 567, 568; 19 NW2d 101 (1945).
Howard, supra, 570.
MCL 560.101 et seq.; MSA 26.430(101) et seq. (Now referred to as the Michigan Subdivision Control Act of 1967.).
Id.
MCL 560.221-560.228; MSA 26.430(221)-26.430(228).
MCL 565.101 et seq.; MSA 26.1271 et seq.
MCL 565.104; MSA 26.1274.
"The act makes it clear that it works no changes in the application and operation of legal principles as to recording, adverse possession, prescription, etc., in so far as events and transactions during the forty-year period are concerned.” (Emphasis added.) Aigler, Clearance of Land Titles — A Statutory Step, 44 Mich L Rev 45, 54 (1945). | [
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] |
Bronson, J.
Defendant appeals by right from a December 31, 1979, judgment, entered pursuant to a jury verdict, awarding damages to plaintiffs as a result of injuries sustained by Tracey Ann Fox-worth when a jug of methanol exploded during a physical science class at a school operated by defendant. At the time of the incident, Ms. Fox-worth was 14 years old. The jury placed plaintiffs’ total damages at $295,000. However, the jury also found that Tracey Ann had been 44% negligent under comparative negligence principles. Thus, the trial court entered judgment in the amount of $162,839.60 with interest at 6% per annum from July 19, 1974, the filing date of plaintiffs’ original complaint.
This case is no stranger to the Michigan appellate courts. In Bush v Oscoda Area Schools, 72 Mich App 670; 250 NW2d 759 (1976), this Court affirmed the lower court’s grant of summary judgment on the basis of governmental immunity as to the school district and the superintendent, but reversed as to the classroom teacher and school principal. While all three judges agreed on the result, each wrote a separate opinion explaining his rationale. The Michigan Supreme Court in Bush v Oscoda Area Schools, 405 Mich 716; 275 NW2d 268 (1979), reversed as to the Oscoda Area Schools, holding that the classroom in which the explosion occurred could be found to be dangerous or defective in light of the use for which it was assigned at the time of the incident. As such, the defendant school system could be held liable under the "defective building” provision of the governmental tort liability act. MCL 691.1406; MSA 3.996(106). The Court’s decision also rendered all of the individual defendants free from liability, albeit the four votes for this position came on different theories.
The factual background of this case is adequately set forth in the two previous Bush opinions. Further facts will be set forth as necessary for a complete discussion of the issues raised.
Defendant asserts that because this case was tried under the "defective building” exception to the governmental tort liability act, the trial judge reversibly erred by restricting defendant’s introduction of evidence at trial regarding its reasons for using the classroom in question for physical science education. We agree with the trial court that why the classroom in issue was utilized as it was is unimportant. Defendant relies on the following sentence from the Supreme Court opinion in Bush, supra, 733, for its position:
"In such situations it might be reasonable to change temporarily the use of a building or room or in the case of a highway, reroute traffic.”
This sentence is taken out of context, however. The following excerpt from Bush explains under what circumstances a temporary change in a room’s use may be deemed reasonable:
"A governmental agency is not subject to liability for a dangerous or defective condition unless it 'had actual or constructive knowledge of the defect and, for a reasonable time after acquiring knowledge, failed to remedy the condition or to take action reasonably necessary to protect the public against the condition’. It was thus a question of fact whether the school district, with knowledge of the defect, failed 'to take action reasonably necessary to protect’ the students. Temporary use of the unconverted room may have been reasonable provided the school district took appropriate action to protect the students until permanent protective measures could be provided. ” Id. (Emphasis added and footnotes omitted.)
Defendant does not argue that the use of the room for physical science classes was temporary. Furthermore, defendant failed to introduce testimony showing that "appropriate action to protect the students” had been taken (i.e., the installation of normal safety devices). As such, explanations such as increased enrollment could not excuse the district and were irrelevant. In any case, much evidence was adduced concerning student population, lack of available laboratory space, and scheduling conflicts. The jury had before it the essence of the evidence defendant contends was improperly excluded.
Defendant also contends that the verdict was against the great weight of the evidence. This assertion is based largely on the fact that Ms. Foxworth initially lied about how the explosion occurred. The original opinions in this case were premised on the false testimony. Ms. Foxworth, who had apparently matured over the years since the accident occurred, elected to tell the truth at trial. Foxworth admitted that she brought a lighted match near the open end of the alcohol jug and this is what caused the explosion.
It does not appear to us that Foxworth’s original deception has any bearing on defendant’s present challenge to the evidence. The case was tried on the theory that the classroom constituted a dangerous place when used for physical science classes because it lacked safety devices including an exhaust hood, safety shower, sinks, fixed desks, chemical powder fire extinguisher, was exposed to sunlight, and was used for improper storage. The fact that Ms. Foxworth was more responsible for the explosion than was originally believed in no way negates the fact that there were inadequate safety devices.
Defendant next asserts that the trial court’s modification to SJI 21.02 requires reversal. The modifications involved the substance of the contributory negligence portion of the instruction. Some alteration of this instruction was manifestly required to reflect the comparative negligence doctrine as adopted by the Supreme Court in Placek v City of Sterling Heights, 405 Mich 638; 275 NW2d 511 (1979).
Despite this obvious fact defendant urges us to apply the rule that any modification of the standard jury instructions is presumptively prejudicial. Javis v Board of Education of the School Dist of Ypsilanti, 393 Mich 689, 702; 227 NW2d 543 (1975). Javis, however, is inapposite because here the deviation was not from "an applicable and accurate SJI”.
The trial court instructed:
"Plaintiff has the burden of proof on each of the following propositions:
" 'a’, that Tracey Ann Foxworth was injured;
" 'b\ that the classroom was dangerous or defective when used as a physical science classroom;
" 'c’, that defendant had actual or constructive knowledge of this dangerous or defective condition;
"'d’, that for a reasonable time after acquiring this knowledge defendant failed to remedy the condition or failed to take action reasonably necessary to protect Tracey Ann Foxworth against this condition;
" V, that the dangerous or defective condition of the classroom was a proximate cause of Tracey Ann Fox-worth’s injuries and damages.”
Defendant objects to the fact that later references to what plaintiffs had to prove were simply referred to as "a through e”. The trial judge stated that to reiterate the elements each time a reference was made to plaintiffs’ burden of proof would introduce mere repetition which would not aid the jury. The charge accurately stated the law. If the jurors could not remember what plaintiffs had to prove, they could have requested further instructions. They did not. On the record at hand we have no reason to believe that the jury did not understand what elements plaintiffs were required to prove.
Defendant also argues that the trial court erred reversibly in denying its request to charge the jury that Tracey Ann Foxworth was negligent as a matter of law and that this negligence was a proximate cause of her injuries. Instead of giving the requested instruction, the court charged in accordance with SJI 10.05 as follows:
"Contributory negligence for a minor plaintiff; when I use the term negligence or contributory negligence with respect to the conduct of Tracey Ann Foxworth I mean her failure to use ordinary care for her own safety, which proximately contributed to her injury. By failure to use ordinary care for her own safety, I mean the failure to do something which a reasonably careful minor of the age, mental capacity and experience of Tracey Ann Foxworth would do or the doing of something which a reasonably careful minor would not do under the circumstances which you find existed in this case. It is for you to decide what a reasonably careful minor would do or would not do under the circumstances.”
In Baker v Alt, 374 Mich 492; 132 NW2d 614 (1965), the Supreme Court adopted the common-law rule and held that children under the age of seven could not be found contributorily negligent. This same common-law rule provided that children between the ages of 7 and 14 were presumed to be incapable of contributory negligence. Prosser, Torts (4th ed), § 32, pp 154-157. We find no Michigan cases adopting this aspect of the common-law rule. We do find, however, several venerable Michigan Supreme Court decisions stating that when older children are involved, their conduct is to be assessed in relation to their age, intelligence, and experience. See East Saginaw City R Co v Bohn, 27 Mich 503 (1873) (specifically referring to the recklessness of boys from "eight to fourteen years of age”), Cooper v Lake Shore & Michigan Southern R Co, 66 Mich 261; 33 NW 306 (1887) (plaintiffs decedent was an 11-year-old girl), Harris v Crawley, 170 Mich 381; 136 NW 356 (1912) (plaintiff was a 13-year-old girl), Black v Parke, Davis & Co, 211 Mich 274; 178 NW 700 (1920) (plaintiffs ward was a 15-year-old boy).
GCR 1963, 516.6(2) provides:
"Pertinent portions of Michigan Standard Jury Instructions (SJI) published under authority of this sub-rule shall be given in each civil case in which jury instructions are given if (a) they are applicable and (b) they accurately state the applicable law.”
Under existing Supreme Court precedent we find no error in charging the jury in SJI 10.05.
Defendant’s next assertion of error does not challenge its responsibility for damages but, rather, whether the jury was improperly allowed to consider loss of earning capacity as an element of damages. Defendant contends that no evidence was submitted suggesting that plaintiffs injuries in any way interfered with her capacity to earn a living. No objection was lodged against the giving of this instruction so that absent a showing of manifest injustice, any error in the instruction is not grounds for reversal. Gage v Ford Motor Co, 102 Mich App 310, 319; 301 NW2d 517 (1980).
We disagree that the instruction was erroneous. Ms. Foxworth was a licensed beautician at the time of the trial. She was interested in cosmetology but, were she to pursue a career in this field, at a minimum she would need to wear gloves because cosmetology involves the handling of chemicals. Ms. Foxworth has a poor ability to spread her fingers on her burned hand. She also has extraordinarily thin skin which provides little protection from injury. Her scars are permanent, and it may be necessary for her to have further surgery. Ms. Foxworth has both social and occupational limitations. Her treating physician testified that she should not do heavy manual labor or any sort of outside work. She also must avoid chemical irritants and the cold. In our opinion these facts were sufficient to justify giving an instruction on loss of earning capacity.
The final claim of error presents an issue of first impression concerning how prejudgment interest is to be computed in light of the Supreme Court’s decision to adopt comparative negligence in Placek, supra. Defendant argues that since, prior to Placek, Ms. Foxworth’s own negligence would have precluded plaintiffs’ recovery, interest should have been awarded only from February 8, 1979, the date upon which Placek was decided.
We agree with defendant’s contention that had this case been tried pre-Placek, contributory negligence would have been a bar to Ms. Foxworth’s recovery. However, it does not follow that, because of a change in the substantive law regarding the effect of a plaintiff’s own negligence in a tort action,. interest should not be paid from the date the action was initially filed. MCL 600.6013; MSA 27A.6013 provides for interest to be calculated from the date of filing the complaint. The Supreme Court did not provide in Placek that, for purposes of calculating interest, cases filed prior to the date Placek was decided in which a plaintiff is ultimately found partially negligent are to be considered filed on February 8, 1979. Recently the Legislature amended MCL 600.6013; MSA 27A.6013 by 1980 PA 134. The Legislature could have provided that interest be calculated from February 8, 1979, in cases involving a finding of comparative negligence filed prior to February 8, 1979. It did not. The failure of the Legislature to alter the interest statute to provide for a different date upon which computation of interest is to begin in comparative negligence cases must be taken as indicative of a legislative intent not to provide any special method of computation in such cases. The Legislature when amending a statute is presumed to have knowledge of existing laws. Skidmore v Czapiga, 82 Mich App 689, 691; 267 NW2d 150 (1978), lv den 403 Mich 810 (1978). Furthermore, in light of the fact that Placek was intended to rectify what were perceived as inequities caused by the contributory negligence rule, we see no reason to perpetuate these inequities in any manner following the Placek decision.
Plaintiffs also raise an issue concerning the proper calculation of interest in light of the recent amendment to MCL 600.6013; MSA 27A.6013. However, since plaintiffs did not take a cross-appeal, we decline to consider their claim.
Affirmed.
The irrelevance of the proposed line of questioning can be illustrated by analogizing to a medical malpractice case arising out of an emergency procedure in a hospital. If, in retrospect, the doctor’s surgical treatment had a bad result, his explanation as to why he acted as he did would be highly relevant to whether he was negligent, assuming he observed basic medical procedures prior to embarking on the operation. However, his explanation as to why he decided a particular surgical procedure would be in order would be totally irrelevant if he admitted that he had dirty hands at the time he operated and his patient experienced detriment due to infection. Similarly, defendant in this case argues that, despite the fact that it did not intend to introduce any testimony showing that the classroom was only to be temporarily used for physical science instruction and despite the fact that it did not plan to show that adequate measures had been taken to make the room safe for use as a physical science classroom, it should be allowed to explain why it was using the room for physical science classes as a defense to the action. | [
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M. F. Cavanagh, J.
Plaintiffs entered into a settlement agreement with third-party defendant Sentry Insurance Company (Sentry) after plaintiffs’ decedent, Amos Bonsall, was killed in an automobile accident in Wisconsin during the course of his employment. Sentry was the insurer of the third-party tortfeasor (a Wisconsin resident). Defendant American Motorists Insurance Company (American), insurer of the decedent’s employer’s vehicle, claimed it was entitled to reimbursement or setoff of the settlement money and filed a counter-complaint against plaintiffs and a third-party complaint against Sentry. Both American and Sentry moved for summary judgment, GCR 1963, 117.2(1). Sentry’s motion was granted. American appeals as of right.
The settlement agreement in the instant case was entered into by plaintiffs and Sentry without the participation of American. American claims that it is entitled to reimbursement or setoff of the settlement money because the settlement operates to unjustly enrich Sentry and serves as a double recovery for plaintiffs.
MCL 500.3116; MSA 24.13116 provides:
"(1) A subtraction from personal protection insurance benefits shall not be made because of the value of a claim in tort based on the same accidental bodily injury.
"(2) A subtraction from or reimbursement for personal protection insurance benefits paid or payable under this chapter shall be made only if recovery is realized upon a tort claim arising from an accident occurring outside this state, a tort claim brought within this state against the owner or operator of a motor vehicle with respect to which the security required by section 3101(3) and (4) was not in effect, or a tort claim brought within this state based on intentionally caused harm to persons or property, and shall be made only to the extent that the recovery realized by the claimant is for damages for which the claimant has received or would otherwise be entitled to receive personal protection insurance benefits. A subtraction shall be made only to the extent of the recovery, exclusive of reasonable attorneys’ fees and other reasonable expenses incurred in effecting the recovery. If personal protection insurance benefits have already been received, the claimant shall repay to the insurers out of the recovery a sum equal to the benefits received, but not more than the recovery exclusive of reasonable attorneys’ fees and other reasonable expenses incurred in effecting the recovery. The insurer shall have a lien on the recovery to this extent. A recovery by an injured person or his or her estate for loss suffered by the person shall not be subtracted in calculating benefits due a dependent after the death and a recovery by a dependent for loss suffered by the dependent after the death shall not be subtracted in calculating benefits due the injured person.
"(3) A personal protection insurer with a right of reimbursement under subsection (1), if suffering loss from inability to collect reimbursement out of a payment received by a claimant upon a tort claim is entitled to indemnity from a person who, with notice of the insurer’s interest, made the payment to the claimant without making the claimant and the insurer joint payees as their interests may appear or without obtaining the insurer’s consent to a different method of payment.
"(4) A subtraction or reimbursement shall not be due the claimant’s insurer from that portion of any recovery to the extent that recovery is realized for noneconomic loss as provided in section 3135(1) and (2)(b) or for allowable expenses, work loss, and survivor’s loss as defined in sections 3107 to 3110 in excess of the amount recovered by the claimant from his or her insurer.”
However, in Workman v Detroit Automobile Inter-Ins Exchange, 404 Mich 477; 274 NW2d 373 (1979), this section was interpreted in relation to MCL 500.3135; MSA 24.13135. Section 3135 provided that an insured’s third-party recovery was limited to noneconomic losses. The Supreme Court read these two sections together and stated that § 3116 meant that an insurer is entitled to reimbursement "for losses for which personal injury protection benefits were paid”. Id., 510.
After this decision, § 3116 was amended to limit the right of reimbursement to benefits for which personal protection benefits were received, or otherwise "would be entitled to receive”. This language seems to designate those situations where a plaintiff has received a tort claim judgment and it has either been satisfied or is due him. It does not appear that that language can be interpreted as a mandate to a plaintiff to pursue a tort claim, as is contended by defendant here.
The Court in Workman stated that the purpose of § 3116 was to prevent double recovery of economic loss. Workman, supra, 510.
Applying § 3116 to the facts in the instant case, it appears that American would have a right to reimbursement from plaintiffs for a tort claim arising from an accident occurring outside this state if the recovery realized by plaintiffs includes compensation for damages covered by personal protection benefits already received by plaintiffs or for benefits to which they are otherwise entitled. Under (3) of § 3116 an insurer who has the right of reimbursement under subsection (1) has a right to seek indemnity from a person, in this case third-party defendant, who, with notice of the insurer’s interests, made the payment to a plaintiff without making the plaintiff and the insurer joint payees. Thus, the prerequisites to the invocation of (3) are that the insurer first have a right of reimbursement against plaintiff, and that third-party defendant had notice of defendant’s interest. Third-party defendant in this case denied that it had such notice, and plaintiffs deny that defendant had a right of reimbursement against them.
MCL 500.3116; MSA 24.13116, subsection (4), reiterates that no subtraction or reimbursement is due defendant from that portion of a recovery to the extent that the recovery is realized for noneconomic loss.
Defendant in the instant case claims that plaintiffs’ settlement must be subtracted from the no-fault benefits payable just as damages recovered in tort claims are subtracted from workers’ compensation benefits. Defendant cites Pelkey v Elsea Realty & Investment Co, 394 Mich 485; 232 NW2d 154 (1975). In Pelkey, the plaintiff entered into a settlement agreement with an alleged third-party tortfeasor. The settlement of $10,000 was allocated as follows: $3,000 to the plaintiff’s husband for loss of consortium, $3,364.60 to the workers’ compensation carrier as reimbursement, and $3,635.40 to the plaintiff for pain and suffering.
After settlement, the plaintiff in Pelkey was treated again and petitioned for additional workers’ compensation. She was awarded this compensation but was required to reimburse the carrier out of the amounts received in the settlement for pain and suffering. The Court determined that recoveries for pain and suffering were intended to be economic loss; therefore, all the damages recoverable in tort included compensation for all losses required to be compensated for by the workers’ compensation carrier. This decision precluded a double recovery by the plaintiff.
In the instant case, the settlement agreement specifically states that the settlement was neither compensation or reimbursement for losses compensable or payable under no-fault nor related to any reimbursement for medical out-of-pocket expenses or economic loss suffered during the first three years after the accident. In short, the agreement very specifically states that the monies received are for injuries not compensable under the Michigan no-fault act. Accepting that the settlement agreement was written in good faith, defendant is precluded from obtaining reimbursement or sub traction based on § 3116. Furthermore, if there were no rights to reimbursement or subtraction, then there was no right to participate in the agreement made between plaintiffs and third-party defendant. Even accepting as true defendant’s allegation that under the circumstances the settlement agreement manifests collusion, there still appears to be no cause of action under §3116. Summary judgment, then, was properly granted.
This result is further supported by Mathis v Interstate Motor Freight System, 408 Mich 164; 289 NW2d 708 (1980), and Great American Ins Co v Queen, 410 Mich 73; 300 NW2d 895 (1980). In Mathis, the Court dealt with the question of whether the no-fault act required a setoff of workers’ compensation benefits received by an insured. The Court ruled that workers’ compensation benefits must be deducted from no-fault benefits received since "[t]he workers’ compensation benefits are paid as a result of the same accident and duplicate in varying degrees the no-fault benefits otherwise due”. Mathis, 187. No double recovery was allowed.
In Great American, supra, Great American paid the defendant workers’ compensation benefits for injuries he suffered while driving an automobile in the course of his employment. Queen had settled a claim against the third-party tortfeasors for noneconomic losses. This claim of $18,500 was paid by the tortfeasors’ no-fault insurers without notice to the workers’ compensation insurer. Great American brought an action against the tortfeasors and Queen for reimbursement of workers’ compensation benefits from the settlement on the theory that it was entitled to subrogation under the Worker’s Disability Compensation Act. Summary judgment was granted in favor of the defendants. Both the Court of Appeals and the Supreme Court affirmed, holding that the workers’ compensation benefits were for Queen’s economic loss and the no-fault benefits for his noneconomic loss, so that there was no double recovery. The Court’s holding emphasized that no-fault insurance compensates purely economic elements of damage. The Court went on to say:
"The no-fault insurer’s right to reimbursement out of tort recoveries from third parties is governed by § 3116 of the no-fault act and this Court’s decision in Workman. The right to reimbursement extends only to those atypical cases where tort recovery is permitted for elements of damage compensated by no-fault benefits; there is no right to reimbursement unless there is duplicate recovery.” (Footnotes omitted.) Great American, supra, 93-94.
The facts in Great American Ins Co are very similar to those in the instant case. However, Great American brought an action for reimbursement of workers’ compensation benefits from a settlement and defendant in the instant case brought an action for reimbursement of no-fault benefits from plaintiffs tort settlement.
Finally, defendant contends that if plaintiffs had sued under Wisconsin’s wrongful death act and had received an award, only $10,000 of that award could be deemed noneconomic loss. Thus, since plaintiffs received a settlement of $110,000, at least $100,000 of that must be for economic loss and, consequently, subject to subtraction from the no-fault benefits. This argument is without merit. First, plaintiffs did not bring suit in Wisconsin; they are suing defendant in Michigan for no-fault benefits. Since there was no suit in Wisconsin and no judgment rendered, Wisconsin’s wrongful death act does not apply to the settlement. Also, as stated by the trial judge in his opinion, plaintiffs had no obligation to sue third-party defendant under the Michigan no-fault act. Also, in addition to the extrapolation required by defendant’s argument, one must infer that the term "pecuniary injury” used in the Wisconsin statute is synonymous with "economic” loss as used by the Michigan statute. Defendant has cited no case law to support this argument.
Defendant’s proposition that the settlement agreement was collusive because it was entered into without consulting defendant and because it specifically excluded those items covered by the personal injury protection furnished by defendant is without substantiation. These facts, standing alone, do not invoke the provisions of § 3116(1) or (2).
In the instant case, it appears that the settlement agreement could very well have been made in good faith. Since plaintiffs’ decedent was only 51 years of age, it is likely that he would have had many years of lucrative employment ahead of him. Section 3135(2)(c) of the no-fault act allows recovery of damages for economic loss beyond three years and for loss in excess of the daily and monthly limitations. Since plaintiffs’ decedent would have been only 54 years of age three years after the accident, and since he earned approximately $21,000 a year at the time of his death, the settlement properly included compensation for these economic losses not covered by the no-fault act. Viewed in this light, the settlement is neither excessive nor suggestive of collusion and bad faith. The trial court’s grant of summary judgment is affirmed.
Affirmed. Costs to third-party defendant Sentry. | [
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] |
Per Curiam.
Plaintiff appeals as of right from an order granting defendants’ motion for summary judgment under GCR 1963, 117.2(1). This case arose from the refusal of defendants to consider a grievance filed by a probationary employee.
On October 30, 1979, Lloyd Shomp was hired by the county to work in the probate court shelter home. During the six-month probationary period, Shomp received unfavorable evaluations from the shelter home caseworker, the shelter home superintendent, and the administrator of placement services for the Ingham County Probate Court.
On April 2, 1980, Shomp was formally informed that his final day of work would be April 18, 1980. He filed a grievance on April 8, 1980, demanding that the termination be rescinded. He filed the grievance because he felt he was being discriminated against because of his religion and to protest the "other conditions of employment”.
At the time plaintiff filed its grievance, Shomp was a probationary employee under the provisions of the collective-bargaining agreement between the county and the Ingham County Employees Association (hereinafter referred to as ICEA or the "union”).
The complaint in this action was filed after Shomp had been terminated from employment and it asked the court to order defendants to arbitrate the Shomp grievance. Defendants filed a motion for summary judgment alleging that the complaint had failed to state a claim for which relief could be granted and that there was no genuine issue of a material fact, GCR 1963, 117.2(1) and (3). Defendants also filed a counterclaim alleging that plaintiffs representation of Shomp violated the collective-bargaining agreement and asking the court to restrain and enjoin the ICEA from breaching the contract by continuing to represent a probationary employee.
At a hearing on the motion, the ICEA maintained that its representation of Shomp was for the purpose of grieving a condition of employment and not to challenge the termination. Defendants’ counsel argued that the ICEA was representing Shomp for purposes of termination or discipline, contrary to the contractual language prohibiting such representation. The trial judge granted defendants’ motion based on GCR 1963, 117.2(1).
Plaintiff first asserts that the trial court erred by ruling that the ICEA could not seek arbitration of the grievance filed on behalf of a probationary employee.
A motion for summary judgment based on GCR 1963, 117.2(1) challenges the legal sufficiency of a plaintiffs claim and is to be considered by an examination of the pleadings alone. The reviewing court must accept as true the well-pleaded facts contained in the plaintiffs complaint and determine whether or not these claims are so unenforceable as a matter of law that no possible factual development could justify a right to recovery. Ready v Clark Equipment Co, 91 Mich App 474, 478; 283 NW2d 650 (1979), lv den 407 Mich 888 (1979). Furthermore, any conclusions which may be reasonably drawn from the factual allegations may be considered.
Contracts are to be enforced so as to effectuate the intentions of the parties involved. Their intention is determined by considering the language used in the contract and the situation of the parties and the surrounding circumstances. Ready, supra, 478-479.
Here, plaintiff in its prayer for relief requested that the matter be arbitrated as called for by the agreement. It incorporated the provisions of the collective-bargaining agreement into its complaint. Accepting as true all of plaintiffs well-pleaded facts, the question becomes whether or not it has stated a claim for which relief can be granted.
Article IV of the agreement between defendant Ingham County and the ICEA states:
"Section 1. Deúnitions. The terms 'employee’ and 'employees’ when used in the Agreement shall refer to and include only those regular, full-time employees and part-time employees who have completed their probationary period as set forth in this Agreement and who are employed by the employer in the collective bargaining unit described hereunder”. (Emphasis added.)
Thus, at the outset it can be seen that Shomp did not satisfy the definition of "employee”.
Article VI(B) states:
"The Union may represent employees during the probationary period with respect to their rates of pay, hours of employment, or other conditions of employment. However, notwithstanding the above, employees disciplined, terminated or laid off during the probationary period shall not have recourse to the grievance procedure provided for herein and the Union shall not represent them in respect thereto.” (Emphasis added.)
This language is clear and unambiguous. Probationary employees have no right to the grievance procedure. The only exception is that they may bring a grievance regarding pay, hours, or conditions of employment. The general rule clearly states that "notwithstanding the above” there shall be no right to the grievance procedure. As stated by the trial court, the exception cannot be allowed to swallow the rule. Since a probationary employee can be terminated without recourse to the grievance procedure, any grievance he may have had regarding his "other conditions of em ployment” becomes moot following his dicharge. The language indicates that the exception applies only to probationary employees who are still employed. Plaintiff here is asserting that Shomp still had a right to file a grievance on "other conditions of employment” despite the fact that he was properly terminated within the meaning of the agreement and despite the fact that these "other conditions” are ostensibly the reasons set forth for his termination. To allow this argument would result in total circumvention of the clear, unequivocal language and intention of the agreement.
Moreover, the grievance procedure for Ingham County Probate Court employees does not provide for binding arbitration. Rather, it is a three-step grievance process wherein the final unappealable decision lies with the Labor Relations Committee of the court. Also, as stated previously, the grievance procedure is available to employees as defined in the agreement. The only time the procedure is available to probationary employees is under the exception. Thus, after Shomp was terminated, he not only had no "conditions of employment” to complain of, he was not an employee by definition of the agreement, and binding arbitration was not available to a probate court employee of any type under the agreement.
Therefore, summary judgment was properly granted defendants. This conclusion does not require the resolution of any factual disputes; it is apparent from reading the unambiguous language of the agreement. See Brown v Holton Public Schools (After Remand), 401 Mich 398; 258 NW2d 51 (1977).
Plaintiff also contends that the trial court erred by ruling that the ICEA was contractually barred from representing a probationary employee who after his termination from employment sought to file a grievance regarding a change in working conditions. Much of the previous analysis is equally applicable here. American Fidelity Fire Ins Co v Barry, 80 Mich App 670, 674-676; 264 NW2d 92 (1978), lv den 402 Mich 915 (1978), set forth a three-stage inquiry for determining whether or not a matter is arbitrable: (1) whether there exists an arbitration agreement in a contract between the parties; (2) whether the dispute is arguably covered by the contract and the arbitration clause; and (3) whether the dispute is expressly exempt by the terms of the contract.
Although there is an arbitration agreement in the contract between plaintiff and defendants, this portion of the contract does not apply to the probate court employees who, instead, must resort to a three-stage grievance procedure with a final decision rendered by the Labor Relations Committee.
If this were indeed a dispute over "other conditions of employment” it would undoubtedly be covered by the contract, but it would not be covered by the arbitration clause in the instant case because as stated, Shomp was a probate court probationary employee. Additionally, the dispute here is expressly exempted by the terms of the contract. The trial judge correctly determined that plaintiff’s argument was a mere bootstrap effort to collaterally attack the termination of a probationary court employee. We therefore conclude that plaintiff was contractually barred from representing Shomp after his termination from employment notwithstanding that the grievance was couched in terms which would make it fall within the exception provided in the contract.
The judgment below is affirmed. Defendants may tax costs. | [
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Per Curiam.
Defendant was charged with the crime of armed robbery, MCL 750.529; MSA 28.797, and possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2). On June 2, 1980, defendant pled guilty to the count of armed robbery and was sentenced to serve one year and one day to three years in prison. The felony-firearm count was dismissed pursuant to defendant’s motion. The people bring this appeal challenging the propriety of the dismissal of the felony-firearm count.
The charges against defendant stemmed from the armed robbery of a Little Caesar’s pizzeria on February 27, 1980. The manager of the pizzeria testified at the preliminary examination that a young man and young woman had entered the store, that the young woman had pointed a pistol at him and demanded money, that he had handed over the money, and that the pair then left, running to a car.
A Livonia police officer testified that he arrested defendant based on the strength of information from a female juvenile who stated that she had robbed the store with the defendant. This juvenile told the officer that defendant had taken the gun, belonging to his father, from his house without the father’s knowledge. The officer further testified that when arrested, defendant admitted to having some money from the robbery and agreed to go to his house to retrieve the pistol used in the robbery. The pistol was given to the officer by defendant’s father at his house.
A statement made by defendant to the police indicated that defendant had taken the pistol from his father’s drawer, had driven to a gas station where he had given the gun to another female who robbed the gas station, and then drove to Little Caesar’s where he gave the gun to the female juvenile. In pleading guilty, defendant admitted having knowingly participated in the armed robbery but indicated that during the rob bery the female juvenile held the gun which came from his father’s drawer.
At the time this matter was in circuit court, there was a split in the Court of Appeals concerning application of the aider and abettor statute to the felony-firearm statute. That conflict has since been resolved in People v Johnson, 411 Mich 50; 303 NW2d 442 (1981), wherein the Court héld that one may be convicted of aiding and abetting the commission of a separately charged crime of carrying or having a firearm in one’s possession during the commission of a felony, if it is established that the defendant procured, counseled, aided or abetted and so assisted in obtaining the proscribed possession or in retaining such possession otherwise obtained. 411 Mich 50, 54.
Although the trial court’s dismissal of the felony-firearm count, under the facts of this case, was erroneous in view of the Johnson decision, it was validly supported at the time by the decisions in People v Powell, 90 Mich App 273; 282 NW2d 803 (1979), and People v Walter Johnson, 85 Mich App 654; 272 NW2d 605 (1978). The issue in the present case, therefore, is whether the decision in Johnson is to be applied retroactively.
Generally, full retroactivity is the rule, and prospectivity is the exception. People v Markham, 397 Mich 530, 548; 245 NW2d 41, 49 (1976) (Levin, J., dissenting), People v Young, 410 Mich 363, 373; 301 NW2d 803 (1981) (Levin, J., concurring and dissenting), People v Bryant, 80 Mich App 428, 435; 264 NW2d 13 (1978). Retroactivity may be limited, however, when a balancing of three factors so dictates. The three factors are: (1) the purpose of the new rule; (2) the general reliance upon the old rule; and (3) the effect of retroactive application of the new rule on the administration of justice. People v Young, supra, 366.
Applying the first factor, it is clear that the purpose of the rule announced in Johnson was to mend the split concerning application of the felony-firearm statute which had developed within this Court by providing criteria for determining guilt based on participation not involving actual possession or use of a firearm during the commission of a felony.
The Court’s choice of granting leave to decide two cases involving conflicting results indicates the Supreme Court’s purpose was to clarify existing law. This purpose supports retroactive application of the rule since such an application would serve to reconcile the inconsistent results under the felony-firearm statute which have preceded the new rule. Such a reconciliation would provide for a uniform application of criminal justice. In addition, relying upon People v Kamin, 405 Mich 482; 275 NW2d 777 (1979), this Court has indicated that a purpose of clarifying existing law is sufficient for the retroactive application of a rule of law. People v Slager, 105 Mich App 593; 307 NW2d 376 (1981), People v Szymanski, 102 Mich App 745, 747; 302 NW2d 316 (1981).
The second and third factors may be considered together, as the extent of the reliance on the old rule often determines the effect upon the administration of justice. People v Hampton, 384 Mich 669, 677; 187 NW2d 404 (1971), People v Taylor, 99 Mich App 613, 616; 299 NW2d 9 (1980).
Where there has been profound reliance on the old rule, the effect of retroactive application of the new rule on the administration of justice could be marked, People v Rich, 397 Mich 399, 403; 245 NW2d 24 (1976). It cannot be said that there has been profound reliance on the old rule. In fact, the "old rule” consisted of two or more inconsistent applications which led to the split in this Court. In addition, the statute, enacted on January 1, 1977, is a virtual legislative newborn and, as such, has not been the subject of profound reliance. Thus, retroactive application, in all likelihood, will not cause a disruption of the administration of justice.
The Supreme Court in Markham, supra, 547, indicated that the third retroactivity factor focuses primarily on the impact on prosecutorial and judicial resources of requiring a large number of retrials.
While it cannot be said that retroactive application of the rule will not lead to retrials, this Court is not of the opinion that such retrials as do occur will be particularly burdensome. In order to insure that retrials remain at a reasonable level, we limit retroactive application of the new rule to those appeals which were pending at the time that Johnson was decided. See People v Kamin, supra, 495, People v Reese, 97 Mich App 785; 296 NW2d 172 (1980). Such application will serve a two-fold purpose: it limits the number of felony-firearm cases to be retried and it provides consistency in the application of the statute in those cases pending on appeal, insuring that cases before this Court will receive the same disposition that Supreme Court cases have in the past. People v Bryant, supra, 437.
We vacate the order dismissing the felony-firearm count against defendant and remand the case to the trial court for further proceedings to determine the felony-firearm count consistent with the rule announced in Johnson. | [
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M. J. Kelly, J.
This appeal presents the question of whether an intentional tortfeasor who is being sued for a tort involving the breach of a fiduciary duty may seek contribution from an alleged joint intentional tortfeasor. Defendant-third-party plaintiff William Newman seeks review of the issue after a lower court granted third-party defendant Ted Boschma’s motion for summary judgment pursuant to GCR 1963, 117.2(1).
Plaintiff Fidelity and Deposit Company of Mary land initiated this action against Newman alleging that he misappropriated and diverted funds belonging to his employer, Frankenmuth Mutual Insurance Company. The complaint also alleged that Newman filed $47,748.19 in false automobile claims with Frankenmuth. Pursuant to a contract of bond, Fidelity paid Frankenmuth and sought repayment of the funds from Newman.
Newman filed a third-party complaint against a number of third-party defendants. Ted Boschma, one of the third-party defendants, brought a motion for summary judgment, arguing that contribution among intentional tortfeasors was not a recognized doctrine in Michigan. The lower court agreed, holding:
"I do know that the general rule of law and equity * * * [is] that a person seeking the tort relief should come in with clean hands. * * * [T]he general principle of law is courts are not open to help those who are engaged in illegal activity. * * * Our courts are for people who haven’t committed transgression themselves.”
The standard used to review a lower court’s grant of a motion for summary judgment based on GCR 1963, 117.2(1) is well settled. The motion is to be tested by the pleadings alone. Todd v Biglow, 51 Mich App 346, 349; 214 NW2d 733 (1974), lv den 391 Mich 816 (1974). The motion tests the legal basis of the complaint, not whether it can be factually supported. Partrich v Muscat, 84 Mich App 724, 729; 270 NW2d 506 (1978). The factual allegations of the complaint are taken as true, along with any inferences or conclusions which may fairly be drawn from the facts alleged. Id., 729-730. Unless the claim is so clearly unenforceable as a matter of law that no factual development can possibly justify a right to recover, the motion under the subrule should be denied. Id., 730.
The statutory provision which delineates the basic right of contribution among tortfeasors is MCL 600.2925a; MSA 27A.2925(1). The excerpt which governs contribution among joint tortfeasors states in part:
"(1) Except as otherwise provided in this act, when 2 or more persons become jointly or severally liable in tort for the same injury to a person or property or for the same wrongful death, there is a right of contribution among them even though judgment has not been recovered against all or any of them.
"(8) This section does not apply to breaches of trust or of other fiduciary obligations.”
This statute is substantially similar to the Uniform Contribution Among Tortfeasors Act. The commissioners’ comment to subsection 1(g) of that act states:
"The meaning is clear. It is not intended that the act should extend to liabilities arising out of breaches of fiduciary relationships.” 12 ULA, § 1(g), p 66.
This particular subsection of the statute has not been interpreted by a Michigan court. However, the Florida District Court of Appeals addressed the effect of this section in Eason v Lau, 369 So 2d 600 (Fla App, 1978), cert den 368 So 2d 1365 (Fla, 1979). In Eason, plaintiff sued a number of defendants alleging a tort involving breach of a fiduciary relationship. When plaintiff voluntarily dismissed one of the defendants, the remaining defendants moved for summary judgment claiming the dismissal released all defendants. The trial court denied defendants’ motion and they appealed.
On appeal plaintiff argued that Fla Stat 768.041 allowed the release of one tortfeasor without affecting his right against the other tortfeasors. Defendants argued that the common-law rule that the release of one tortfeasor released all tortfeasors applied because Fla Stat 768.31, which is the same as MCL 600.2925a; MSA 27A.29250), repealed Fla Stat 768.041. The court rejected defendant’s argument citing Fla Stat 768.31(2)(g), which is the same as MCL 600.2925a(8); MSA 27A.2925(1)(8). The court stated:
"It syllogistically follows, therefore, that if the tort charged sub judice involved breach of trust or other fiduciary obligation and that Fla Stat 768.31 (the Uniform Contribution Among Tortfeasors Act) is not applicable to breaches of trust or other fiduciary obligation and if 768.041 is applicable to all torts, as held by the Supreme Court in the Batchelor case [321 So 2d 73 (Fla, 1975)], then the conclusion is inescapable that Fla Stat 768.31 is inapplicable and Fla Stat 768.041 is controlling. Fla Stat 768.041 being controlling, the common law rule is inapplicable; therefore the release of Virgo did not operate as a release or discharge of the other joint tortfeasors.” Id., 602.
In this case, Newman, as an appraiser and claims adjuster for Frankenmuth, had . a fiduciary duty to refrain from misappropriating and diverting funds belonging to his employer. He also had a fiduciary duty not to file false claims with his employer. PlaintiiFs action against Newman is based upon his alleged breaches of duty making MCL 600.2925a; MSA 27A.2925(1) inapplicable. Because Newman does not have a statutory right to contribution, he must demonstrate a common- law right to contribution to avoid summary judgment.
The general rule of contribution allows a defendant who pays more than his share of a judgment to recover contribution against other tortfeasors who have failed to pay their respective shares. Caldwell v Fox, 394 Mich 401, 417; 231 NW2d 46 (1975). At common law, an exception to this rule was created denying the right of contribution to intentional wrongdoers. Id., 417; Prosser, Torts (4th ed), § 50, p 305. Because of the liberalized joinder rules, American courts extended this exception to include negligent wrongs. Caldwell, supra, 418. To avoid this extension, a number of states, including Michigan, adopted statutes which gave joint tortfeasors the right to contribution. Prosser, supra, 307. In Moyses v Spartan Asphalt Paving Co, 383 Mich 314; 174 NW2d 797 (1970), the Court examined MCL 600.2925; MSA 27A.2925, which was the predecessor to MCL 600.2925a; MSA 27A.2925(1). The Court held that the statute only applied to joint tortfeasors. Id., 331. The Court also examined the common rule bar to contribution and abolished the rule stating:
"Stimulated by the national advancement of principles set forth in the Uniform Contribution Among Tortfeasors Act, supra, the tendency of other courts to provide by judicial action the right of contribution on behalf of all but intentional wrongdoers, and the compelling admonitions of modern writers like Prosser, we have decided to overrule what is left of Michigan’s common-law bar of contribution between or among 'wrongdoers,’; wilful or intentional wrongdoers excepted. Such overrulement will leave the issue of contribution to equitable principles as known hitherto and now in matters of express or implied contract.” Id., 334-335.
Under the holding in Moyses, Michigan common law does not permit an intentional tortfeasor recovery of contribution from other joint tortfeasors.
Plaintiffs action against Newman is based on fraud and conversion which are intentional torts. See Johnston’s Administrator v United Airlines, 23 Mich App 279, 285; 178 NW2d 536 (1970), Warren Tool Co v Stephenson, 11 Mich App 274, 299; 161 NW2d 133 (1968). Because an intentional tortfeasor who is being sued for a breach of a fiduciary duty has no right to contribution from other joint tortfeasors, Newman’s claim against Boschma is unenforceable, and the trial court did not err when it granted summary judgment pursuant to GCR 1963, 117.2(1).
In reaching this conclusion, we are not unaware of the Court’s decision in Hunt v Chrysler Corp, 68 Mich App 744; 244 NW2d 16 (1976). In Hunt, the Court examined MCL 600.2925(1); MSA 27A.2925(1), the predecessor to MCL 600.2925a; MSA 27A.2925(1), and found it applicable to joint intentional tortfeasors. Id., 749. However, the Court did not address the effects of MCL 600.2925a(8); MSA 27A.2925(1)(8), which makes the statute inapplicable to suits alleging a breach of a fiduciary duty. Since this action arises from an alleged breach of a fiduciary duty, Hunt, supra, is not applicable.
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Cynar, J.
Defendant was charged with obtaining a controlled substance by fraud, MCL 333.7407(l)(c); MSA 14.15(7407)(l)(c). Defendant’s motion to quash the information was denied. Pursuant to a plea agreement, defendant pled guilty to the charge in exchange for the prosecutor’s agreement to withdraw a supplemental information charging defendant as a habitual offender by reason of three prior convictions for obtaining or attempting to obtain a controlled substance by fraud. On April 25, 1980, defendant was sentenced to serve 32 months to 4 years in prison. Defendant appeals by right.
Defendant claims that the magistrate who bound him over for trial erred in doing so, that the trial court erred in denying defendant’s motion to quash the information and that the trial court erred in accepting defendant’s guilty plea.
Defendant’s guilty plea arguably waived any challenge to the sufficiency of the evidence for a bindover. See People v Hill, 86 Mich App 706, 711-713; 273 NW2d 532 (1978), but we need not consider the waiver issue because the. same legal issues are presented by defendant’s attack on the factual basis for his guilty plea as are raised by his challenge to the bindover and to the trial court’s ruling on the motion to quash. After considering each of defendant’s arguments, we find no reversible error.
I
In the instant case it is undisputed that the pharmacist who filled the forged prescription knew that the prescription had been altered. Defendant therefore claims that he could not be convicted of obtaining a controlled substance by fraud, since the pharmacist was not in fact deceived by the prescription. Defendant contends that because of this fact, the most he could be convicted of is an attempt to obtain a controlled substance.
The same argument was rejected by this Court in People v Genovese, 53 Mich App 657; 220 NW2d 207 (1974). Defendant attempts to distinguish Genovese by the fact that it was not certain there that the pharmacist knew that the prescription was forged, while in the instant case there was no doubt as to the pharmacist’s knowledge that the prescription was forged. This distinction is irrelevant. Genovese holds that whére a forgery is used to obtain a controlled substance, knowledge of the forgery on the part of a pharmacist does not reduce the crime to a mere attempt. This is apparently so because of the language of the statute, which enumerates forgery as one of the prohibited means of obtaining such a substance, while also listing misrepresentation, fraud or deception. It is important to note that each of those terms are used in the disjunctive. Use of a forgery is prohibited regardless of whether it actually causes deception. Defendant’s reliance on dicta in Genovese which expresses a policy against burdening pharmacists with enforcement duties is inapplicable. Rather than being the basis for the decision as defendant suggests, the policy comment was merely given as a supplemental reason for avoiding the opposite result. The Genovese opinion stated clearly that the policy ground was not necessary to its decision. Id., 661. As a final note on this issue, defendant’s authorities for the propo sition that actual deception is an element of fraud do not involve cases of forgery, and thus are not applicable to the instant case. See, e.g., People v Wilde, 42 Mich App 514; 202 NW2d 542 (1972), where the charge was obtaining money under false pretenses, MCL 750.218; MSA 28.415.
II
Defendant never had actual possession of the illegally obtained substance. Defendant gave the altered prescription to a co-worker who agreed, at defendant’s request, to pick up the prescription, pay for it and deliver it to defendant, whereupon defendant would reimburse the co-worker for the purchase price. The co-worker was apprehended by police officers after he obtained the prescription but before he was able to deliver it to defendant.
Defendant argues that since he never had possession of the controlled substance, the most he could have been convicted of is an attempt to obtain a controlled substance, and that there was no factual basis established at the plea-taking hearing to support the existence of the completed crime as opposed to the attempt.
The people contend that defendant’s co-worker was acting as defendant’s agent by picking up the prescription, and that the co-worker’s possession of the controlled substance was sufficient constructive possession by the defendant to convict him of the completed crime.
It is conceded by both parties that the co-worker in question had no knowledge of the alteration of the prescription and that his participation in the alleged crime was completely innocent. Defendant cannot, therefore, be convicted as an accomplice or an aider and abettor.
In accepting defendant’s guilty plea, the trial court ruled on the proposition that the co-worker was defendant’s agent, and that defendant was chargeable with possession and knowledge of possession of the controlled substance through his agent. Defendant claims that constructive possession cannot be established by such an agency theory but requires some form of personal dominion and control over the item in question, such as where defendant has the item locked in the trunk of his car and possesses the key to the trunk. See People v Harper, 365 Mich 494; 113 NW2d 808 (1962). Harper and other cases cited by defendant are silent on the question of an agency relationship such as the one in the instant case. We find no clear case law in Michigan that an individual defendant may commit necessary elements of a crime through the acts of an innocent agent. We are persuaded, however, by the reasoning of the California Supreme Court in People v White, 50 Cal 2d 428; 325 P2d 985 (1958).
In White, the defendant had left money for the purchase of a capsule of heroin with his apartment roommate. The latter individual purchased the item from a known heroin user when defendant was absent. On appeal, defendant argued that the evidence was insufficient for conviction of possession of narcotics because there was no evidence that he had possession of the narcotic or knowledge of its presence. The California Supreme Court, en banc, rejected this claim:
"[Defendant’s roommate] purchased the heroin as agent for appellant and pursuant to his express instructions, and appellant, as the owner of the capsule, was entitled to exercise dominion and control over it. He had constructive possession as soon as the narcotic was acquired for him, and it is immaterial whether he had personal knowledge of the presence of the narcotic in the apartment.” Id., 431.
In the instant case, it is clear that the co-worker was merely an innocent conduit in defendant’s fraudulent scheme. He acquired the substance for defendant pursuant to express instructions and arrangements. He doubtlessly would have delivered it to defendant had the police not intervened.
In these circumstances, a finder of fact could readily conclude that defendant had "acquire[d] or obtained] possession”, MCL 333.7407(l)(c); MSA 14.15(7407)(l)(c), of the controlled substance. There was, therefore, no abuse of judicial discretion in binding defendant over on the fraudulent acquisition charge, or in accepting a guilty plea to this offense. Although it could be argued that the instant case is distinguishable by reason of the fact that defendant had not yet reimbursed his coworker for the purchase of the controlled substance, we find that such a distinction does not mandate a different result. Defendant and his coworker had agreed to a course of action whereby defendant was left in control of whether he had the right to obtain the substance from his coworker. We cannot allow criminals to insulate themselves from responsibility for the commission of crimes by utilizing innocent third parties to carry out certain elements of a crime.
Ill
Defendant claims that the trial court improperly relied on testimony taken at the preliminary examination to establish the fact that defendant’s coworker had in fact obtained the controlled substance. Defendant relies on People v Schneff, 392 Mich 15; 219 NW2d 47 (1974), which holds that a guilty plea is not properly accepted where the trial court relies on testimony taken at the preliminary examination even where the parties stipulate to the consideration of such evidence.
The people counter by citing Guilty Plea Cases, 395 Mich 96, 134, fn 3; 235 NW2d 132 (1975), for the proposition that other methods than direct questioning of the defendant are allowable to establish the factual basis for the crime where warranted by special circumstances. In the instant case, defendant did not have direct knowledge of the fact that his agent had received the controlled substance and it was appropriate to rely on some other method to establish that fact.
People v McKnight, 102 Mich App 581; 302 NW2d 241 (1980), held it permissible to use preliminary examination testimony to establish a fact outside the knowledge of defendant upon stipulation by the parties. The charge in McKnight was maliciously injuring or destroying an animal, and the fact in question was the death of the animal 12 hours after being beaten by that defendant. At the plea-taking proceeding, that defendant stated that he had no personal knowledge of the death of the animal, and the parties stipulated to acceptance of the preliminary examination testimony that such was the case.
McKnight is on point with the instant case but does not address or distinguish Schneff. There is, however, a substantive distinction between the cases in that the trial court in Schneff generally relied on the preliminary examination in finding a factual basis. In McKnight and in the instant case, the preliminary examination testimony was used only to establish a single fact that was outside the knowledge of defendant and not open to serious question. None of the evils which concerned the Court in Schneff are present in the instant case. In further support of the McKnight holding, we note that the citation in Guilty Plea Cases supports our belief that the Supreme Court has retracted from a rigid prohibition on the use of preliminary examination testimony. Finally, we note that under Guilty Plea Cases, the proper remedy, where a defendant’s guilty plea is not supported by an adequate factual basis, is to remand to the trial court to allow the prosecutor to establish the missing fact. Id., 129. Even now defendant does not claim that his agent did not receive the controlled substance, and it is manifest that in fact he did. It is clear, therefore, that a remand in the instant case would be a useless gesture.
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] |
V. J. Brennan, P.J.
Defendant appeals from an order entered by Wayne County Circuit Court Judge Thomas J. Brennan on September 17, 1979, denying defendant’s motion for accelerated judgment and to compel arbitration.
According to the lower court record, the following chronology of events occurred. Plaintiffs’ decedent, Dominic John DiPonio, was admitted to Henry Ford Hospital for medical treatment on June 25, 1978. On that day, decedent voluntarily executed an arbitration agreement. The next day, June 26, 1978, decedent underwent a coronary surgical procedure and died during the course of the operation. Shortly thereafter, plaintiffs through counsel requested copies of all decedent’s records from the hospital defendant. The records furnished by the hospital contained no copy of the arbitration agreement.
Subsequently, on May 22, 1979, plaintiffs David DiPonio and Daniel DiPonio filed the instant wrongful death medical malpractice action on behalf of decedent’s estate against defendant Henry Ford Hospital. While the caption of plaintiffs’ complaint indicated that plaintiffs were co-administrators of decedent’s estate, plaintiffs were not in fact appointed administrators until August 3, 1979. However, the lower court ordered the appointment to be nunc pro tunc as of May 22, 1979.
On July 17, 1979, defendant filed a motion for accelerated judgment and to compel arbitration pursuant to the arbitration agreement executed by decedent. In opposition to this motion, plaintiffs and their attorney averred in their affidavits that they first became aware of the arbitration agreement on July 17, 1979, when the defendant filed the motion for accelerated judgment.
The motion was heard before Wayne County Circuit Court Judge Thomas J. Brennan on August 17, 1979' The lower court denied the defendant’s motion. The lower court further gave plaintiffs two months from July 17, 1979, the date when concededly the plaintiffs "discovered” the existence of the arbitration agreement, to serve upon defendant a revocation of the arbitration agreement executed by decedent.
Thereafter, in a letter dated August 17, 1979, plaintiffs revoked the arbitration agreement.
Defendant sought application for leave to appeal from the lower court’s determination from this Court. The matter is now before the Court on our grant of application for leave. We affirm the lower court.
We first address the pivotal issue of jurisdiction. The defendant suggests that, since the arbitration agreement was concededly properly executed, jurisdiction to decide all other issues was vested exclusively in the arbitration forum. In short, it says a properly executed arbitration agreement divests the circuit court from jurisdiction to decide whether or not a revocation of the agreement could be made.
This Court addressed a similar argument in Capman v Harper-Grace Hospital, 96 Mich App 510; 294 NW2d 205 (1980). There, it was also alleged that, since there was no dispute that the arbitration agreement complied with the statute and was duly signed, all issues involving its interpretation should have been submitted to arbitration. This Court stated:
"We reject this contention. Arbitrators derive their power solely from the arbitration agreement. Smith v Highland Park Board of Education, 83 Mich App 541, 546; 269 NW2d 216 (1978), Chippewa Valley Schools v Hill, 62 Mich App 116, 119; 233 NW2d 208 (1975). The arguments plaintiffs raised at the hearing upon defendant’s motion were material to the question of the validity of this agreement itself. * * * [I]f plaintiffs timely revoked the agreement, no basis would exist to support defendant’s motion. Thus, it becomes readily apparent that compulsory submission to arbitration cannot precede a judicial determination of the validity of the agreement itself.” Capman, supra, 513-514.
The holding of the Capman decision is clearly applicable to the instant case. The issue of whether plaintiffs have the power to make timely revocation of the agreement goes directly to the determining of whether or not there is a valid agreement to arbitrate. GCR 1963, 769.2(1), (2). We find that the circuit court has jurisdiction to decide such preliminary matters.
The major issue presented by this appeal is whether the plaintiffs, as personal representatives, made timely revocation of the arbitration agreement.
The Malpractice Arbitration Act provides inter alia that:
"(3) The agreement to arbitrate shall provide that the person receiving health care or treatment or his legal representative, but not the hospital, may revoke the agreement within 60 days after discharge from the hospital by notifying the hospital in writing.” MCL 600.5042(3); MSA 27A.5042(3).
Pursuant to statutory mandate, the arbitration agreement executed by plaintiffs’ decedent provided in bold face type:
"THIS AGREEMENT TO ARBITRATE IS NOT A PREREQUISITE TO HEALTH CARE OR TREATMENT, AND MAY BE REVOKED WITHIN 60 DAYS AFTER DISCHARGE BY NOTIFICATION IN WRIT-ÍNG * * *.”
However, decedent was never discharged from the hospital. Rather, the day immediately following his execution of the agreement, June 26, 1978, he died while undergoing a heart catheterization.
Defendant now argues that decedent’s "death” is analogous to a "discharge”. In this regard, defendant contends that the arbitration agreement constitutes an enforceable contract and, pursuant to Michigan law, binds plaintiffs, as decedent’s personal representatives, to arbitrate their wrongful death action. Defendant points to the plain lan guage of the statute and notes that the statute is applicable to either personal injury or death which results from malpractice. Since the statute does not contain any special provision which would give a personal representative a longer length of time (by tolling the 60-day period until appointment or until discovery of the arbitration agreement), the revocation by plaintiffs was not timely since it was not made within the 60-day period following decedent’s death.
Plaintiffs aptly counter this argument on the basis of two viable analogies. They predicate their argument on the major premise that the 60-day revocation period is essentially a statute of limitation provision. Recognizing the 60 days as a statute of limitation, they then analogize on the basis of two applicable statute of limitation tolling provisions: (1) the "disability” provision of MCL 600.5851; MSA 27A.5851 and (2) the "discovery” provision of MCL 600.5838(2); MSA 27A.5838(2).
First, plaintiffs cogently argue that decedent’s "death” is not analogous to a "discharge”, as defendant contends. Rather, they argue that the death is more akin to the onset of a disability in that it rendered the decedent incapable of any and all ability to act on his own behalf. Furthering the analogy, they reason that the 60-day revocation period is tolled during the period of disability and does not recommence until the disability is removed. In the instant case, the disability was judicially removed by their appointment as personal representatives of decedent’s estate in that it vested in them the legal authority to revoke the agreement on behalf of decedent. Plaintiffs reason that the 60-day revocation period recommences to run following the removal of the disability, i.e., their appointment as personal representatives. Ac cordingly, since the filing of the complaint in circuit court served to revoke the arbitration agreement and the filing of the complaint was within the 60 days following their appointment, timely revocation occurred within the time limitations.
Alternatively, plaintiffs argue and the trial court reasoned on the basis of the analogous "discovery” rule of MCL 600.5838(2); MSA 27A.5838(2). This provision provides that the limitation period does not begin to run until the plaintiff discovers or should have discovered the existence of the claim. Using this analogy, the plaintiffs therefore have 60 days after the discovery of the existence of the arbitration agreement in which to exercise their power of revocation.
We are persuaded, on the basis of constitutional considerations, case law and common sense, that there is merit to both the "disability” and "discovery” theories for tolling the 60-day period allowed in which to revoke the arbitration agreement.
We reach our determination by first and foremost recognizing the constitutional dimensions of the issue. The enforcement of the arbitration agreement involves the denial of the constitutional right to a trial before a court of law. Brown v Siang, 107 Mich App 91; 309 NW2d 575 (1981), Morris v Metriyakool, 107 Mich App 110; 309 NW2d 910 (1981). Every doubt, therefore, must be resolved in favor of guaranteeing that there was an intentional, willing and knowing relinquishment or abandonment of this fundamental right.
A review of the statute clearly indicates that the 60-day revocation period is intended to provide a grace period in order to assure that there is an intentional relinquishment of the right to a trial in a court of law as well as to provide a limitation period in order to afford a reasonable time within which revocation must be made. Neither of these purposes are furthered by allowing the 60 days to run regardless of whether there is any individual with the legal capacity to make such legal determinations as in the instant case where the decedent died prior to his discharge. Thus, we reject the simplistic argument that decedent’s death is to be equated with discharge.
Rather, we hold that, upon death of the patient prior to discharge from the hospital, the 60-day revocation period must be tolled by the adoption of a tolling provision analogous to that of either "disability” or "discovery”. We find support for either position in prior decisions by this Court. In Amwake v Mercy-Memorial Hospital, 92 Mich App 546, 553; 285 NW2d 369 (1979), this Court specially considered whether the revocation period specified by the Malpractice Arbitration Act should have a grace period based upon disability. This Court stated:
"Under these circumstances, a parallel can be drawn to the general savings provisions of the Revised Judicature Act which creates exemptions from the running of statutes of limitations. See MCL 600.5851(1); MSA 27A.5851(1). This section provides those who are minors, insane or imprisoned at the time their claim accrues with a one-year grace period after their disability is removed in order to bring their action, although the period of limitations has run. * * *
"Clearly, Mrs. Anteau’s comatose state prevented her from comprehending her rights or from exercising them in her best interests. By analogy, then, Mrs. Anteau should be given 60 days from the time her disability was removed to revoke the arbitration agreements.”
By similar reasoning death creates a disability which is not removed until a personal representa tive is appointed. Therefore, we conclude that the 60-day revocation period is tolled until a legal representative is appointed and vested with the authority to revoke or ratify the arbitration agreement.
The Amwake Court also held that the filing of a malpractice case serves to implicitly revoke an arbitration agreement. Since the undisputed facts of this case were that the malpractice complaint was filed on May 22, 1979 (thereby revoking the arbitration agreement) and plaintiffs appointment became effective on May 22, 1979, the conclusion naturally follows that the revocation of the agreement was timely.
Alternatively, under the facts of the instant case, we are equally convinced of the applicability of the "discovery” rule in tolling the 60-day revocation period. In the instant case, it is undisputed that the personal representatives were not aware of the existence of the arbitration agreement until defendant filed its motion for accelerated judgment. The trial court ruled that the plaintiffs had 60 days from the date they first received notice of the arbitration agreement to revoke the agreement. We affirm this decision by the lower court. In doing so, we are aware that in Capman v Harper-Grace Hospital, supra, 516, this Court rejected the "discovery rule” of the injury as applicable to arbitration agreements. However, the Cap-man Court added its own caveat which sufficiently distinguishes it from the present case. The Capman Court explained that the "discovery rule” was a remedy to prevent the harsh result which occurs when a person is unable to recognize the existence of a claim. Since the plaintiff-patient in Capman was not in any way disabled, the Court held that it made no sense to excuse plaintiff from the 60-day limitation period. The Court went on to note however:
"A different situation would present itself if the plaintiffs were physically and mentally incapable of revoking during the 60-day period * * *
"[I]f * * * plaintiff * * * was physically and mentally unable to communicate her revocation to the hospital within the required time or authorize her legal representative to do so * * * as a practical matter * * * plaintiff was denied her opportunity to revoke [and] we would be inclined to [hold otherwise].” Capman, supra, 517.
We find that the present case is distinct from the facts of Capman in the very manner envisioned.
In summary, we hold that the lower court did not err in denying defendant’s motion for accelerated judgment and to compel arbitration. We find that in a case where the decedent dies prior to discharge from the hospital, the 60-day revocation period is tolled until the personal representative is appointed or the existence of the arbitration agreement is discovered or should be discovered by the personal representative.
The trial court’s denial of defendant’s motion is affirmed. | [
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J. L. Banks, J.
Defendant was convicted of embezzlement, MCL 750.174; MSA 28.371, and conspiracy to embezzle, MCL 750.157a(a), 750.174; MSA 28.354(1)(a), 28.371. He was thereafter sentenced to serve concurrent terms of from 3 to 10 years imprisonment. Because defendant was denied the effective assistance of counsel and because the trial court erroneously admitted hearsay evidence, we reverse and remand for a new trial.
On the day set for trial, November 8, 1979, attorney Thomas Law, on behalf of the defendant, moved for a short continuance so that defendant’s newly retained counsel, Frederick Lauck, could represent defendant instead of court-appointed counsel, Alan Ackerman. The motion for a continuance was made before the trial court. Attorney Law explained to the court that defendant had acquired the money needed to retain an attorney and had hired Mr. Lauck a week previously but that Mr. Lauck was then in the middle of another trial. Mr. Law’s explanation went on to relate that Mr. Lauck had prepared a stipulation and order for substitution of counsel and for an adjournment and that he (Lauck) had expected the defendant to pick up the stipulation, carry it to attorney Ackerman’s office for his signature and then have the stipulation filed. However, defendant’s arrest on other charges precluded this arrangement and the stipulation was not signed or filed. When Mr. Lauck found out about the situation, he made phone calls to Chief Judge Dunn two days prior , to trial and, on the day before trial was to begin, Lauck was told by Judge Dunn’s clerk that he would have to bring in a formal motion.
As the trial began, attorney Ackerman candidly told the trial judge that he was not prepared to try the case because defendant had notified him that he had retained attorney Lauck during the previous week. Subpoenas were not delivered for alibi witnesses and Ackerman had not spoken with the defendant in several weeks.
Defendant explained, on the record, that the court had previously told him that if he had the money he could hire his own lawyer. He told the court that he had just received a check in settlement of a claim and that he no longer wanted attorney Ackerman to represent him. After the prosecutor noted that Chief Judge Dunn had denied the continuance motion, Judge Gilmore said that he was without authority to grant the motion when Judge Dunn was present since, under the circumstances, Judge Dunn alone controlled the court’s docket. WCCR 14.9. This ruling was an abuse of discretion.
The right to a fair trial is so basic to our system of justice that we cannot allow blind adherence to a local court rule to deprive an accused of his right to proceed with retained counsel of his own choice should he choose to do so. Ungar v Sarafite, 376 US 575, 589; 84 S Ct 841; 11 L Ed 2d 921 (1964), Nilva v United States, 352 US 385; 77 S Ct 431; 1 L Ed 2d 415 (1957).
Neither the defendant nor his counsel were negligent in informing the court of the change that defendant desired. No prior continuances or adjournments had been requested or granted and there is no indication that the change of attorneys was a delaying tactic. The desire of the trial court to proceed is not a sufficient reason to deny a defendant an otherwise proper request for a continuance. People v Ferguson, 46 Mich App 331, 339; 208 NW2d 647 (1973), People v Charles O Williams, 386 Mich 565, 577; 194 NW2d 337 (1972). Because counsel was not prepared for this trial and admitted that he was not, we find that the defendant was denied the effective assistance of counsel guaranteed him by both state and federal constitutions.
Since this case is to be retried, we address a question of hearsay evidence which may again arise. During trial, defendant’s accomplices, Cox and Atherton, testified to their involvement in the crimes charged. Officer Karol Kapelczak of the Dearborn Heights Police Department testified at length, apparently from a police report, concerning a statement given by Wade Hannah, a missing res gestae witness. Later in the trial another officer testified that, according to the Law Enforcement Information Network (LEIN), the license plate number referred to in Officer Kapelczak’s testimony of what witness Hannah had reported belonged to a vehicle registered to the defendant. Defense counsel did not object. Moreover, the prosecution had another police officer summarize both accomplices’ confessions for the jury.
When it was discovered that Wade Hannah had not been subpoenaed, the trial court correctly ruled that he was a res gestae witness and that the prosecutor had not shown due diligence in producing him for trial.
Even though witness Hannah was never produced, the prosecution argued in closing that
"a man was seen sometime around 10:00 o’clock smashing the window, never going in, though, and getting into a car matching the description of Mr. Battles’ and with the same license number as Mr. Battles’.”
Further, the prosecution argued, concerning the accomplice’s testimony:
"Yes, the judge will tell you that Mr. Hannah was not brought into the courtroom and he will tell you that the law in Michigan, because it is the law that we do everything we can to assure a fair trial, you may presume that his testimony would be favorable to the defendant. But you heard basically what he would have told you and not objected to and in evidence. Sometimes it isn’t easy to get witnesses in all the time. Sometimes jurors don’t want to serve, sometimes witnesses don’t want to come, it is tough, but we protect the defense. The judge will give it to you, that is the law, I don’t quarrel with it. But regardless of whether we have Mr. Hannah in the courtroom, you have got the testimony of the two men that were in it with him and you have got the testimony of other witnesses that indicate what he is telling you doesn’t make sense.”
The statement given by Wade Hannah to the police was inadmissible hearsay. People v Hagle, 67 Mich App 608, 614; 242 NW2d 27 (1976), MRE 801(c). Moreover, Hannah’s preliminary examination testimony could not, and at retrial should not, be read to the jury under MRE 804(b)(1), because the prosecution failed to show due diligence in securing his presence at trial, required as a condition precedent under MRE 804(a)(5).
Assuming, arguendo, that Hannah would testify at trial in the same vein as he did to the police and at the preliminary examination, his testimony is not simply cumulative, but is most damaging to the defendant. This is especially true in light of the fact that most of the other damaging evidence against the defendant at trial was supplied by accomplice testimony.
Finally, admission of the accomplices’ prior consistent statements for the purpose of bolstering the prosecutor’s case was error. A prior consistent statement of a witness is admissible only to rehabilitate the witness following impeachment by a prior inconsistent statement or to rebut a charge of recent fabrication. When admitted for this limited purpose, the statement is not hearsay. People v Miniear, 8 Mich App 591, 603; 155 NW2d 222 (1967), People v Harris, 86 Mich App 301, 305; 272 NW2d 635 (1978). Given the weight the jury must have attributed to accomplice testimony in this case, we would not say that the admission of this evidence was harmless error. Id.
For these reasons, we find that the defendant was denied a fair trial, and we reverse and remand the case to the Wayne County Circuit Court for a new trial.
Reversed and remanded. | [
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Per Curiam.
Plaintiff appeals the trial court’s order granting accelerated judgment to defendant on the ground the claim was barred by a release. GCR 1963, 116.1(5).
Plaintiff was involved in an automobile accident in 1974. She applied for and received personal injury protection benefits from defendant, her no- fault insurer. About six months later, defendant discontinued payment of the benefits, allegedly due to the opinion of plaintiff’s doctor that she was able to return to work.
Plaintiff did not return to work, and she continued treatment with the physician. She commenced an action against defendant in the Common Pleas Court for the City of Detroit, seeking reimbursement for medical expenses and wage losses accrued at that time. The jury awarded plaintiff $7,400.
Subsequently, plaintiff continued to incur additional medical expenses and wage losses. Defendant refused to honor those claims. Another lawsuit was commenced against defendant. The suit was settled for $20,000. Plaintiff signed a release for past, present, and future claims arising out of the 1974 accident.
Plaintiff allegedly continued to incur expenses due to the accident. She commenced the present lawsuit. The trial court granted defendant’s motion for accelerated judgment on the basis of the releases signed by the plaintiff.
Plaintiff raises one issue on appeal. She asserts that the release of future benefits is void as being contrary to the no-fault insurance statute, MCL 500.3143; MSA 24.13143, and as being contrary to public policy.
MCL 500.3143; MSA 24.13143 states:
"An agreement for assignment of a right to benefits payable in the future is void.”
The clear language of the statute indicates that it applies to assignments. An assignment is not a release. We have no authority or desire to expand upon the plain language of the statute to include releases in the prohibition. Thus, the trial court correctly ruled that the statute is inapplicable to the case at bar.
Plaintiff also argues that the release is void as being against public policy. She argues that the no-fault statutory scheme was designed to provide insureds with adequate and prompt reparation for losses resulting from motor vehicle accidents. Consequently, insurers should not be adversaries of claimants, but rather mere distributors of benefits.
While it is true that the purpose of the no-fault act is to provide insureds with assured, adequate, and prompt compensation for losses, Shavers v Attorney General, 402 Mich 554; 267 NW2d 72 (1978), the act is replete with references to contested claims. Cf. §§ 3112, 3142, 3145, 3148, 3151. Reading the act as a whole, it is clear that the Legislature did not intend for no-fault insurers to pay all claims submitted without reviewing the claims for lack of coverage, excessiveness, or fraud. Where a reasonable dispute exists as to coverage or the amount of benefits owing, the insurer is allowed to contest the claim under the act without penalty. See Lewis v Detroit Automobile Inter-Ins Exchange, 90 Mich App 251; 282 NW2d 794 (1979), Wood v Detroit Automobile Inter-Ins Exchange, 99 Mich App 701; 299 NW2d 370 (1980), Swanson v Citizens Ins Co, 99 Mich App 52; 298 NW2d 119 (1980).
Thus, plaintiff’s argument that insurers are required to merely process and pay claims without reasonably challenging their validity lacks support in the act or under case law.
Plaintiff argues that she was forced to settle the second lawsuit and sign the release because it was an "all or nothing” proposition. In the second lawsuit, which resulted in the release at issue, defendant contested some of the claim because the plaintiff allegedly included expenses incurred from an unrelated illness. If, indeed, plaintiff was seeking excessive benefits, the release was the quid pro quo for defendant’s payment of those benefits. On the other hand, if plaintiff had prevailed at trial in proving that she deserved reimbursement for all the claim as submitted, she could have received interest and attorney fees under the act for defendant’s unreasonable refusal to pay. See MCL 500.3142, 500.3148; MSA 24.13142, 24.13148. It was plaintiff’s choice to settle the dispute and sign the relase, a tactical judgment which this Court will not review.
We find the use of a release of future benefits in settlement of a reasonably disputed claim does not constitute a course of conduct which is cruel or shocking to the average man’s conception of justice. Consequently, plaintiff’s public policy argument is without merit. Skutt v City of Grand Rapids, 275 Mich 258, 264; 266 NW 344 (1936).
Finally, we note that plaintiff apparently has not tendered the $20,000 settlement to defendant, a necessary step in seeking rescission of the release. See Chapman v Ross, 47 Mich App 201; 209 NW2d 288 (1973).
Affirmed. Costs to defendant. | [
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M. J. Kelly, J.
This appeal presents the question of whether agreements between plaintiff, United Coin Meter Co., and defendant’s predecessors in title were leases. Plaintiff appeals a trial court’s finding that the agreements were licenses which did not bind defendant.
On June 25, 1976, United Coin entered into two separate agreements, which were termed leases, with Halstead Management, the agent of defendant’s predecessors in title. Under the agreements, which are identical, plaintiff was to install, maintain, and service coin-operated laundry equipment in two separate apartment complexes belonging to V. G. H. Investment Company and University Villa Association, defendant’s predecessors in title. The agreements contained the following description of the premises:
"UNITED shall install, maintain, and service-automatic coin operated washers,_automatic coin operated dryers in laundry space provided by OWNER at the above premises located in an area measuring approximately 10 feet by 10 feet in the 'Laundry area(s)’ in the aforementioned building(s) for a period commencing from the 1st day of JULY, 1976 and ending 30TH day of JUNE, 1981, or ending FIVE years from the date when the last unit in said complex is completed if it is still being built.”
The agreements also contained a provision requiring any new owner to assume the obligations of the agreements.
In September, 1977, defendant, Craig Gibson, purchased the two apartment complexes by means of two separate land contracts. The terms of the land contracts provided:
"It is understood and agreed that the laundry equipment now on the premises has been leased from United Coin. Since purchaser does not wish an assignment of the existing lease or to be responsible thereunder, such equipment may be removed at United Coin’s pleasure.
"Purchaser assumes no obligations heretofore incurred by seller other than as herein specifically provided, and seller agrees to hold purchaser harmless from any loss resulting from any action taken against purchaser by any creditor of seller as the result of any obligation accruing prior to the date hereof.”
Pursuant to the provisions of the land contracts, defendant removed plaintiffs laundry equipment, replacing it with his own. Plaintiffs equipment was placed in storage.
Plaintiff commenced this action, alleging that defendant had breached the "lease” agreements of June 25, 1976. After a bench trial, the court entered an order of no cause of action in favor of defendant. The trial court found that the June 25, 1976, agreements were licenses rather than leases because the actual area occupied by plaintiffs equipment so far exceeded the description in the agreements that the description was meaningless and inadequate for the purposes of a lease. Plaintiff appeals as of right, GCR 1963, 806.1.
Initially, plaintiff argues that United Coin Meter Co v Lasala, 98 Mich App 238; 296 NW2d 221 (1980), governs this case. However, the text of the opinion does not indicate that the lease in question was an agreement with the same provisions as those at issue in this case. Furthermore, Lasala did not deal with the question of whether the agreement at issue was a lease or a license. That issue was not raised and we therefore find Lasala, supra, inapplicable. Neither is it helpful.
The controlling issue is whether the contracts between plaintiff and Halstead Management are leases or licenses. A license is a permission to do some act or series of acts on the land of the licensor without having any permanent interest in the land. McCastle v Scanlon, 337 Mich 122, 133; 59 NW2d 114 (1953), Morrill v Mackman, 24 Mich 279, 282; 9 Am Rep 124 (1872). A lease, on the other hand, gives the tenant possession of the property leased and exclusive use or occupation of it for all purposes not prohibited by the terms of the lease. Nowlin Lumber Co v Wilson, 119 Mich 406, 410; 78 NW 338 (1899), Royal Oak Wholesale Co v Ford, 1 Mich App 463, 466; 136 NW2d 765 (1965), American Coin-Meter of Colorado Springs, Inc v Poole, 31 Colo App 316, 318; 503 P2d 626 (1972). To be a valid lease, the contract must contain the names of the parties, an adequate description of the leased premises, the length of the lease term and the amount of the rent. Brodsky v Allen Hayosh Industries, Inc, 1 Mich App 591, 596; 137 NW2d 771 (1965), lv den 377 Mich 702 (1966).
While Michigan courts have not addressed the issue of whether an agreement to provide laundry facilities to an apartment complex is a lease or a license, a number of other jurisdictions have considered this question. In Wash-O-Matic Laundry Co v Lefferts Ave Corp, 191 Misc 884; 82 NYS2d 572 (1948), plaintiff contracted with defendant’s predecessor in title to provide laundry machines to an apartment building. Attached to the contract was a diagram which designated part of the basement as the "washing machine room”. When defendant bought the building, it replaced plaintiffs machines with its own. Plaintiff sued, claiming defendant breached the lease agreement. The court found that the agreement was a license because it did not confer upon plaintiff exclusive possession of any definite space as against the owner of the property. Id., 575. The court found that the space designated "washing machine room” was not specific enough for a lease. Id., 575. Accord: Ulan v Vend-A-Coin, Inc, 27 Ariz App 713, 715; 558 P2d 741 (1976), Poole, supra, 318-319, Greenbro Coin Meter Corp v Basch, 205 Misc 853; 132 NYS2d 876 (1954), Reliable Washer Service v Delmar Associates, 49 Misc 2d 348; 267 NYS2d 419 (1966).
However, in Polner v Arling Realty, Inc, 88 NYS2d 348 (Sup Ct, 1949), plaintiff was granted exclusive use of the whole basement of the building of defendant’s predecessor in title for a laundry room for the apartment. When defendant bought the building, it moved in its own machines and stored plaintiff’s laundry equipment. Plaintiff sued, claiming breach of the lease agreement. In this case, the court found that the agreement was a lease because plaintiff was granted exclusive use of a specific area. Id., 349-350. Accord: Bodden v Carbonell, 354 So 2d 927, 929 (Fla App, 1978), Weiman v Butterman, 124 Ill App 2d 246, 252; 260 NE2d 321 (1970).
The agreements between United Coin and Hal-stead Management were drafted by plaintiff. Where a contract is ambiguous, it will be construed against the party preparing it. McCastle, supra, 128-129, Soloman v Western Hills Development Co, 88 Mich App 254, 256-257; 276 NW2d 577 (1979). The agreements contained provisions quoted in the second paragraph of this opinion. The instruments also required that defendant’s predecessors in title keep the laundry rooms clean and safely maintained.
These agreements, like the contract in Wash-OMatic, supra, were not specific enough to be leases. Like the area in Wash-O-Matic, the agreements in this case allowed defendant’s predecessors in title to choose the area designated as laundry areas. Furthermore, the description of the laundry area was too indefinite. In one of the apartment complexes covered by the agreements, the laundry area consisted of three different rooms on three separate floors. Paragraph 1 of the agreement did not contemplate that the laundry area would be contained in three separate areas. The agreements were also vague because they failed to specify the number of machines which would be placed in the different laundry areas. Finally, the agreements did not give exclusive possession or control of the areas to plaintiffs since the defendant’s predecessors in title were required to clean and maintain the laundry area. The agreements only gave plaintiff permission to use the laundry areas and were therefore licenses. Conveyance of the land by the licensor ipso facto operates as a revocation of a license previously granted. Burkhart v Zimmerman, 239 Mich 491, 493; 214 NW 406 (1927).
We find that plaintiff’s cause of action does not lie against defendant. In the land contracts between defendant and his predecessors in title, there were two clauses which specifically stated that vendee Gibson did not assume any responsibility for plaintiff’s laundry equipment. While Gibson knew the equipment belonged to plaintiff company because of the express disclaimer in each of the land contracts, he did not succeed to any obligations of his predecessors in title. Since we have found the agreements not to be valid leases he did not become obligated as a matter of law on said agreements. If plaintiff has a cause of action for breach of the agreements, it appears to be against defendant’s predecessors in title and not defendant.
The trial court did not err when it found that the agreements were licenses and its decision is affirmed.
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Per Curiam.
The City of Detroit, Department of Transportation, appeals as of right from a decision of the Michigan Employment Relations Commission (MERC). The commission entered an order directing an election in a bargaining unit of the Supervisors Chapter of the Department of Transportation Foreman’s Association. The city disputes the inclusion of several job classifications within the bargaining unit on the basis that they were within the "executive exclusion”.
This Court has only limited review of a MERC decision. As recently stated in Detroit Board of Education v Local 28 Organization of School Administrators and Supervisors, AFL-CIO, 106 Mich App 438, 442-443; 308 NW2d 247 (1981):
"[W]e note the limited standard of review for findings of fact made by the Commission, embodied in MCL 423.23(e); MSA 17.454(25)(e):
" 'The findings of the commission with respect to questions of fact if supported by competent, material, and substantial evidence on the record considered as a whole shall be conclusive.’
"See also Const 1963, art 6, § 28 and Council 25, AFSCME v Macomb County Road Comm, 101 Mich App 91, 107; 300 NW2d 462 (1980), citing Employment Relations Comm v Detroit Symphony Orchestra, Inc, 393 Mich 116, 121; 223 NW2d 283 (1974).”
See also Deering v Unionville-Sebewaing Area Schools, 97 Mich App 629, 631-632; 296 NW2d 131 (1980).
The commission has adopted a case-by-case approach to determine whether the executive exclusion applies. City of Detroit, 1978 MERC Lab Op 483, Macomb County Board of Comm’rs, 1979 MERC Lab Op 995.
In City of Grand Rapids, 1979 MERC Lab Op 198, 201, the commission expanded its definition of executive from applying only to "policymaking heads of major departments” to include "an employee who exercises broad discretion, even if it is only in regard to effectuating management policy”. See also Macomb County Board of Comm’rs, supra, Wayne County Board of Comm’rs, 1980 MERC Lab Op 858.
In deciding whether a job title occupies executive status, the commission may consider several factors, such as who has primary responsibility for developing the budget, who plays a significant role in preparing departmental rules and regulations, the number of executive positions relative to the size of the organization, the degree of interchangeability of functions between the employee and his immediate superior, and the degree of participation in labor negotiations or formulation of collective-bargaining policy.
However, the commission has stated that any of these factors alone is not sufficient for a finding of executive status. The commission has refused to exclude employees from a supervisors’ unit merely because they help prepare budget proposals or because they are assistants to executives or have some interchangeable functions with executives. City of Detroit, 1973 MERC Lab Op 733, City of Detroit, 1978 MERC Lab Op 483. Neither is exclusion warranted because an individual is responsible for investigating employees’ misconduct. Detroit Board of Education, 1980 MERC Lab Op 182. The fact that a person replaces an executive when he is absent is not sufficient to exclude him from the supervisors’ bargaining unit. Twp of Waterford, 1974 MERC Lab Op 815.
In City of Grand Rapids, supra, MERC concluded that the executive exclusion applied because the police majors had primary responsibility for budgets, reported directly to the chief of police or his deputy and had a significant role in preparing and promulgating rules and regulations. Similarly, in Organization of School Administrators and Supervisors, supra, this Court upheld a MERC decision of executive status for employees who had some policy input and broad or complete discretion in executing policies.
We have examined the record and conclude that the commission’s decision to include the disputed classifications in the bargaining unit is supported by competent, material, and substantial evidence.
The four disputed job classifications are the assistant superintendents of plant maintenance, rolling stock, transportation operations, and the transportation district superintendent.
The Department of Transportation is headed by the department director and deputy director. Each of its seven divisions is headed by a superintendent, conceded to be an executive, and an assistant superintendent. According to Lionel Little, a for mer deputy director, the assistant superintendents work jointly with the superintendents and are responsible for day-to-day operations of their divisions. They make work assignments, handle disciplinary action, have input regarding budget requests and regarding general policy set by the executive committee, and substitute for the superintendent in his absence.
The commission has determined that the assistant superintendents assist the superintendents, attend executive committee meetings, and substitute for the superintendent when he is on personal leave. The commission concluded that the positions did not have sufficient authority to be classified as executives. Similarly, the commission concluded that, although the transportation district superintendent possesses considerable supervisory responsibilities, the individual did not play a sufficient role in determining or effectuating policy to be excluded from the unit as an executive.
In the present case, the assistant superintendents have limited input into policymaking. They are two levels removed from the department director, who bears ultimate decision-making responsibility. One of the assistant superintendents testified that he attended the executive committee meetings but primarily only answered questions. He stated that he was not authorized to formulate policy for his department. Responsibility for day-to-day operations does not automatically constitute an exercise of broad discretion in effectuating management policy. Although a close question exists in light of the numerous duties involved, the responsibilities exercised by the assistant superintendents are consistent with a high-level supervisory position.
The transportation district superintendent also makes operational decisions and has primary disciplinary authority. However, this position is even further removed from ultimate decision-making authority. The commission’s decision was supported by competent, material, and substantial evidence.
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] |
D. C. Riley, P.J.
Plaintiffs filed a complaint alleging discrimination on the basis of national origin under the now-repealed Michigan fair employment practices act (hereinafter, FEPA), MCL 423.301 et seq.; MSA 17.458(1) et seq. The plaintiff husband, a security guard at General Motors Corporation, alleged that he suffered serious psychological and emotional injuries, neurosis, loss of former job pleasure, loss of consortium and great pain and suffering as a result of employment discrimination based upon his Spanish-American origin. The plaintiff wife alleged that, as a result of defendants’ discriminatory actions against her husband, she suffered mental anguish, emotional distress, disruption of the family and marital relationship, loss of consortium and traumatic anxiety neurosis.
The individual defendants in this case are security supervisors at the plant where plaintiff husband worked. The parties have stipulated that from November 29, 1974, through April 11, 1975, Mr. Pacheco was on approved medical disability leave of absence from his employment. Plaintiffs claim that he was disabled as a result of hypertension and anxiety caused by the discriminatory acts of the defendants. Further, it is stipulated that Mr. Pacheco was discharged from his employment on April 29, 1975, and reinstated on June 2, of the same year. Again, plaintiffs allege that the discharge was the result of discrimination on the basis of national origin.
Defendants filed a motion for summary judgment, challenging the trial court’s jurisdiction over the matter in light of the exclusive remedy provision of the Worker’s Disability Compensation Act (hereinafter, WDCA), MCL 418.131; MSA 17.237(131), and the plaintiff wife’s standing to sue under FEPA. In denying defendants’ motion, the trial court certified the two questions raised on appeal as controlling issues of law. By order of March 3, 1980, this Court granted defendants’ application for leave to appeal from the trial court’s order denying their motion for summary judgment. The two questions certified for our review, which we shall consider seriatim, are as follow:
I. Does the exclusive remedy provision of the Michigan Worker’s Disability Compensation Act deprive the circuit court of Michigan of jurisdiction over an employee’s claims of mental and physical injuries resulting from alleged unlawful employment discrimination, where such injuries are disabling, but not permanently disabling, and where various mental injuries continue after the employee returns to work?
II. Does the spouse of an employee have standing to sue the latter’s employer under Article I, § 2 of the Michigan Constitution of 1963 and the Michigan Civil Rights Statutes for damages which the spouse allegedly suffered as a result of alleged unlawful employment discrimination by the employer against the employee?
I.
Defendants first argue that the exclusive remedy provision of the WDCA deprived the circuit court of jurisdiction over the plaintiff husband’s claim that he suffered disabling injuries and continues to suffer nondisabling injuries as a result of alleged employment discrimination.
MCL 418.301; MSA 17.237(301) provides:
"(1) An employee, who receives a personal injury arising out of and in the course of his employment by an employer who is subject to the provisions of this act, at the time of such injury, shall be paid compensation in the manner and to the extent provided in this act * * * »
MCL 418.131; MSA 17.237(131) provides, in pertinent part:
"The right to the recovery of benefits as provided in this act shall be the employee’s exclusive remedy against the employer * * *.”
At the outset we note several well-established principles, as stated recently by another panel of this Court in Sewell v Bathey Manufacturing Co, 103 Mich App 732, 736-737; 303 NW2d 876 (1981):
"It is beyond question that, when an injury is sustained which is compensable under the Worker’s Disability Compensation Act of 1969, the exclusive-remedy provision of the act bars any common-law tort cause of action by an employee against his employer arising therefrom. Milton v Oakland County, 50 Mich App 279, 283; 213 NW2d 250 (1973), Broaddus v Ferndale Fastener Division, Ring Screw Works, 84 Mich App 593, 597-598; 269 NW2d 689 (1978), lv den 403 Mich 850 (1978). An injury which is 'a personal injury arising out of and in the course of [an injured party’s] employment’ is compensable under the act. MCL 418.301; MSA 17.237(301), Kissinger v Mannor, 92 Mich App 572, 575; 285 NW2d 214 (1979). Personal injuries for which the act provides a remedy include both physical and mental injuries suffered on account of employment. Deziel v Difco Laboratories, Inc (After Remand), 403 Mich 1; 268 NW2d 1 (1978), Kissinger, supra, 575.
"It is also beyond peradventure that the question of whether the act applies to a particular injury, he:, whether an injury arose out of and in the course of a worker’s employment (and thus is compensable under the act), is a question to be resolved in the first instance exclusively by the Bureau of Workmen’s Compensation. Szydlowski v General Motors Corp, 397 Mich 356, 358-359; 245 NW2d 26 (1976), St Paul Fire & Marine Ins Co v Littky, 60 Mich App 375, 377-378; 230 NW2d 440 (1975), MCL 418.841; MSA 17.237(841).” (Footnotes omitted.)
Our analysis begins with a review of Stimson v Michigan Bell Telephone Co, 77 Mich App 361; 258 NW2d 227 (1977), since that was the first case to discuss the effect of the exclusivity bar of the WDCA in the context of employment discrimination and since defendants place principal reliance on that decision to support their claim that the trial judge erred in denying their motion.
In Stimson, plaintiff filed suit under the FEPA, charging defendant with discriminating against her on the basis of sex with regard to grade and wage promotions and her eventual discharge. Plaintiff alleged that, because of the discrimination she encountered, she suffered an acute nervous breakdown, required hospitalization, was unable to secure employment and experienced embarrassment, humiliation and a loss of esteem among her peers. Concurrently, plaintiff filed a claim with the Bureau of Workers’ Disability Compensation [hereinafter, bureau]. Defendant moved for partial summary judgment on the ground that plaintiff’s claims of nervous breakdown, embarrassment, humiliation and loss of esteem were barred by the exclusive remedy provision of the WDCA. The trial court denied defendant’s motion and this Court granted defendant leave to appeal.
Relying heavily upon Professor Larson’s workmen’s compensation treatise, the Court said that not only must the elements of the tort be examined in order to determine whether the suit is barred by the exclusive remedy provision but that the damages claimed must also be reviewed. The Court also said that a civil action against an employer is not barred completely because several of the injuries alleged are those within the coverage of the compensation act. Recovery is, however, precluded for injuries covered under the compensation act. With respect to the facts before it, the Court concluded as follows:
"Plaintiffs’ complaint in the present case alleges a cause of action which generally concerns a type of injury outside the scope of the Workers’ Disability Compensation Act. The mental injuries allegedly suffered by plaintiff, however, are not merely incidental to the violation of her civil rights. They culminated in a disabling condition for which compensation was available. Plaintiffs’ ability to recover for Mrs. Stimson’s nervous breakdown, embarrassment, humiliation and loss of esteem among her peers, therefore, is barred by MCLA 418.131; MSA 17.237(131). Plaintiff’s discharge and her inability to obtain grade and wage promotions, however, if proven to have resulted from sexual discrimination, are injuries for which the act provides no remedy. With regard to these injuries, plaintiff is entitled to a trial on the merits.” Stimson, supra, 369. (Footnotes omitted.)
Another decision of significance to our inquiry is Freeman v Kelvinator, Inc, 469 F Supp 999 (ED Mich, 1979). Freeman involved a class action suit by employees against their employer for alleged race discrimination. Before the court was a defense motion to deny a proposed amendment to the complaint to include therein a prayer for relief under the Elliott-Larson Civil Rights Act. MCL 37.2101 et seq.; MSA 3.548(101) et seq. Defendant contended that the damages sought by plaintiffs for the indignity of discrimination, humiliation and the invasion of their right not to be discriminated against were barred by the exclusivity bar of the WDCA.
In an exhaustive and well-reasoned analysis of Michigan law on the subject, Judge Feikens first traced the historical origins of both the WDCA and the Michigan Civil Rights Act. Relying upon Milton, supra, he noted that:
"The MWDCA was designed to redress 'industrial injuries’ sustained from .'trade risks relating to the industry’. Milton v Oakland County [supra].” Freeman, supra, 1000.
Judge Feikens continued:
"Being a remedial statute, [the WDCA] has been broadened by interpretation to provide benefits to workers whose injuries are intangible mental injuries — even when they are the result of nonphysical causes. But it would be wrong to plunge headlong to the conclusion that all 'injuries’ in any form whatsoever are recoverable only under the MWDCA. Just because mental damages from accidental industrial injuries are compensable does not mean mental injuries from other sources must unthinkingly be barred by the exclusivity provision.” Id. (Citations omitted.)
Judge Feikens then observed that the Civil Rights Act, as compared to worker’s compensation legislation, was designed to redress a completely separate and distinct problem: discrimination. Amplifying this point he noted that such legislation;
"is designed to abolish the smallness of mind that clings to pernicious stereotypes founded not on fact but upon historical misconceptions and fear. Its purpose is to guarantee equal opportunity in the market place and redress the injuries that those in protected groups suffer”. Id.
On this point, Judge Feikens concluded:
"The source of defendant’s misconception is perhaps its belief that the injury which flows from discrimination is akin to mental injuries sustained by workers from compensable sources. It is not. The discrimination injury is unique. Its source is deliberate or inadvertent disregard by the employer of the fundamental rights of his employees. MCLA § 37.2101, et seq. Likewise, though the victim of discrimination may feel embarrassment, humiliation, outrage and disappointment, thus likening the injury to those of 'dignitary’ torts such as defamation, it would be wrong to equate the two.” Id.
As so adeptly stated in Freeman, we cannot blind ourselves to the fact that the WDCA and FEPA are complete and self-contained legislative schemes addressing discrete problems. As noted in Freeman:
"There is no indication whatever that the discrimination law was to have an exception for injuries arguably redressed by the MWDCA, nor is there any indication that the MWDCA was impliedly expanded when the Civil Rights Act was passed.” Id.
That the two pieces of legislation at issue in the instant case are designed to remedy distinct problems was recognized by the Stimson Court. The real significance of Stimson, however, lies in its discussion concerning damages. In Freeman, Judge Feikens reached the following conclusion concerning the scope of this Court’s holding in Stimson:
"Thus, the court’s holding was that where humiliation and embarrassment culminate in disability, then worker’s compensation is the exclusive remedy. The court did not address the question of exclusivity when injury does not culminate in disability. And, indeed, all the indications in the case are that without disability, exclusivity would not apply.” Freeman, supra, 1002. (Emphasis in original.)
He added:
"[I]t was the physical disability for which Plaintiff Stimson claimed that led the court to hold the MWDCA her exclusive remedy. I do not believe the court intended its holding to go beyond that to encompass cases where only mental distress damages are sought.” Id.
Another pertinent case from this Court is Milton, supra. In Milton, plaintiff instituted suit against his employer alleging that his employment rights secured under a merit system had been violated. The pertinent facts and holding of Milton were summarized in Freeman, supra, 1001, as follows:
"[Plaintiff] sought damages for mental anxiety and for the disabling nervous condition he said resulted. Defendant argued that the MWDCA provided the plaintiffs exclusive remedy. The court concluded that only a 'cursory review’ of the MWDCA was necessary to reject defendant’s argument insofar as it pertained to the mental anguish resulting from defendant’s alleged violation of plaintiffs merit system rights. Conceding that recovery for disability could be had only under the MWDCA, the court said, '[i]t is beyond question that plaintiffs claims [for mental distress for the violations of the merit system] if proved, cannot be classified as industrial injuries within the meaning of the Workmen’s Compensation Act. While plaintiffs alleged injuries for muscle fatigue and mental depression fall within the act and are in that respect his exclusive remedy, plaintiff has a right to judicial review of his claims for additional compensation, improper discharge, and violation of the merit system rules.’ ”
Moore v Federal Department Stores, Inc, 33 Mich App 556; 190 NW2d 262 (1971), sheds further light on this issue. In Moore, plaintiff alleged that she was falsely accused and imprisoned by her employer for failing to ring up a sale. Plaintiff was a sales clerk at one of defendant’s stores. She brought an action for false imprisonment, seeking damages for humiliation, embarrassment, and nervous distress. Plaintiff appealed from an order granting defendant summary judgment on the grounds that plaintiff’s sole remedy was at the Workers’ Disability Compensation Bureau.
On appeal this Court reversed, holding that an action for false imprisonment does not seek recovery for an injury that is compensable under the act:
"The Act has been interpreted to encompass physical and mental injuries which arise out of and in the course of one’s employment. However, the gist of an action for false imprisonment is unlawful detention irrespective of any physical or mental harm. We do not feel, therefore, that the plaintiff has suffered the type of personal injury covered under the Act.” (Footnotes and citations omitted.) Id., 559.
The Court also observed:
"It is plaintiff’s claim that her humiliation, embarrassment, and deprivation of personal liberty are not the type of 'personal injury’ contemplated in the above quoted section [of the WDCA]. We agree.” Id.
Our analysis of the aforementioned cases leads us to the following conclusion. To the extent Mr. Pacheco suffered periods of physical disability, the WDCA is his exclusive remedy. Stimson, supra. It would appear, however, that this question is moot since the stipulation of facts indicate that during his periods of medical disability Mr. Pacheco was paid benefits by a third-party insurance carrier under the General Motors group insurance plan. Further, we are of the opinion that those damages which allegedly resulted from the alleged unlawful discrimination by defendants, particularly those resulting from humiliation, embarrassment, loss of consortium, and lost wages, are compensable in circuit court and should not be barred by the exclusivity clause of WDCA. This is true not only of those injuries occurring prior to plaintiff’s dis ability but also as to those occurring after his disability.
To the extent Stimson may be interpreted as holding that, when mental injuries arising from discrimination culminate in a physical disability claim (which is compensable under the WDCA), the prior claims for the mental suffering are "merged” with the physical disability claim, we disagree. Such a result, we believe, is inconsistent with prior Michigan law in this area. See Moore, supra, Milton, supra. We can find no logic in holding that the bureau is the proper forum for recovering compensation when discriminatory employment tactics cause emotional injuries which culminate in disability but that the circuit court is the appropriate forum when the same discriminatory conduct does not cause physical disability. In either case, the alleged cause of the injuries stemmed from the same source: intentional employment discrimination. This is the very conduct the FEPA was designed to protect against. It is not the type of conduct the WDCA was designed to protect against. To hold otherwise, would cancel two remedial statutes. Freeman, supra, 1004.
Although in the usual case the initial determination of whether the WDCA applies to a particular injury is a question to be resolved in the first instance by the bureau, Szydlowski, supra, due to the facts of the instant case, we believe it would be inappropriate to remand this matter to the bureau, since, as we have said, it appears that Mr. Pacheco has already been compensated for the periods of time when he was on medical disability.
II
The second issue raised on appeal is one of first impression in this state. Mrs. Pacheco is seeking recovery for injuries she allegedly suffered as a result of the purported employment discrimination by the defendants against her husband. Her suit is based on two grounds: (1) Const 1963, art 1, § 2, and (2) the FEPA.
Const 1963, art 1, § 2 provides, in pertinent part:
"No person shall be denied * * * the enjoyment of his civil * * * rights or be discriminated against in the exercise thereof because of * * * national origin. The legislature shall implement this section by appropriate legislation.”
It is evident that this constitutional provision is not self-implementing and that it does not provide a source of standing for Mrs. Pacheco’s claim. The provision states no more than a general policy of this state which must be implemented by appropriate legislation. See Pompey v General Motors Corp, 385 Mich 537; 189 NW2d 243 (1971). Accordingly, Mrs. Pacheco’s claim rests upon the provisions of the FEPA, a statute which implemented the constitutional provision.
Section 3 of the FEPA provided in part as follows:
"It shall be an unfair employment practice: (a) For any employer, because of the race, color, religion, national origin or ancestry of any individual, to refuse to hire or otherwise to discriminate against him with respect to hire, tenure, terms, conditions or privileges of employment, or any matter, directly or indirectly related to employment, except where based on a bona fide occupational qualification.” MCL 423.303; MSA 17.458(3).
In Pompey, supra, the Supreme Court specifi cally held that damages for employment discrimination were available under the FEPA. The Court emphasized, however, that the right to redress employment discrimination had to be based upon a statutorily created right:
"We hold that plaintiff can maintain a civil damage action for redress of his statutorily created right to be free from discrimination in private employment, and that this remedy may be pursued in addition to the remedial machinery provided by statute.” Id., 560.
In the instant case, Mrs. Pacheco does not claim that General Motors discriminated against her. Rather, her claim for damages is derivative in nature. In the absence of statutory authority for an employee’s spouse to maintain a private employment discrimination suit, we hold that Mrs. Pacheco’s claims must be dismissed from the action.
Finally, to the extent that the standing requirements of the FEPA are viewed as ambiguous, we note that the primary objective of statutory construction is to ascertain and give effect to legislative intent. Melia v Employment Security Comm, 346 Mich 544, 562; 78 NW2d 273 (1956). Our reading of the statute persuades us that the Legislature did not intend that the spouse of a victim of discrimination has standing to sue under the statute in question for damages resulting to her from that discrimination.
Affirmed in part, reversed in part and remanded to circuit court for a trial on the merits.
No costs, a statutory interpretation being involved. | [
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Christiancy J.:
Do the facts which appear in the case establish the contract declared upon? I think they do not constitute a contract of any kind between the plaintiff and the defend ant, upon which the plaintiff can maintain an action at law. It is clear, I think, from the ease stated, that there was an attempt to make a contract in two parts or duplicates, each of which should be signed and sealed, and of equal validity with the other, that each party might have one in his possession which should constitute the evidence of his rights, and upon which he might enforce the obligations of the other. This, I think, is clearly enough admitted on the face of the declaration, by declaring that the plaintiff “signed and delivered said contract in duplicate to the defendant.” Besides, the subject matter and the printed forms used, seemed to require this; as rights were to be given to and obligations imposed upon each of the parties; the one undertaking to sell and convey on certain terms and conditions, and the.other to pay in certain instalments, and to pay taxes, &c.
And it is just as unreasonable to suppose the purchaser would be willing to leave the whole evidence of his rights in the hands of the vendor, as that the latter should be willing to leave the evidence of his rights in the hands of the former.
Duplicate contracts in such case, must therefore, I think, each be treated as originals by whatever names the parties may have chosen to call them; and though the one delivered to Partland is declared upon its face to be a “ duplicate copy,” the word copy has no appropriate force in such a connection. If a mere copy, not authenticated by the genuine signatures of the persons executing the other, it could not be a duplicate. That this is the true construction is clear from the fact that in the next line the other duplicate is described as the “ original copy."
Did the parties or persons who executed these papers intend to make any contract otherwise than in duplicate ? Are we authorized to say that either would have been willing to enter into the contract evidenced by either oí these papers, without having in his own possession the evidence of Ms rights, and of the obligations of the other ?
If these questions are answered in the negative, as I tMnk it is clear from the whole case they must be, can we, without violating the intentions and the rights of the parties, hold the contract to have been complete and duly executed until duplicates at least substantially alike have been executed and delivered? I am strongly inclined to think we could not, even though Crane had been present executing for himself, and there were no question of agency in the case.
But, as Wesson had no authority to execute for Crane, and the subsequent ratification of the latter was necessary to give validity to the contract, no act of Crane’s shoulcl, I think, be recognized as a ratification of the contract, so as to bind Partland, which would not operate as a ratification of the duplicate delivered to Partland as the evidence of his rights: and to make a ratification of the other operate as a ratification of this, both instruments should be such as to be capable of ratification in the same way and by the same act.
But here, the instruments executed as duplicates are so different that one only was susceptible of ratification. That which came into Crane’s hands describes the vendor as Albert Crane, and is signed “Albert Crane by William B. Wesson.” That delivered to Partland mentions two as vendors, “Albert Crane and William B. Wesson,” and is signed and sealed by William B. Wesson alone, Crane’s name not appearing in the signature. This was incapable of ratification by Crane, as it did not purport to be executed by Wesson or any other person in his behalf. He might have signed it, it is true, and thereby bound himself jointly with Wesson, but this would not be ratifying the act of Wesson as his agent.
The view which I have taken of the case renders it unnecessary to consider the questions raised upon the Statute of Frauds, or the necessity of tendering a deed before action, or the rule of damages in such contracts.
It is possible that Crane, by tendering to Partland a proper duplicate duly executed by Mm, and especially by showing, what does not appear here, that Partland went into possession or received or claimed any benefit under the contract, might sustain a bill in equity, on. the ground of mistake, to reform the contract; but upon this I give no opinion, as the question is not involved in the present case.
Martin Ch. J. and Campbell J. concurred.
Manning J.:
In drawing up the duplicates, or what were intended, to be such, blank forms it would seem were used, that had been got up by Crane & Wesson for the sale of lands by them, in which their names were printed, and they were described as parties of the first part. In filling up the blanks, the name of Wesson was struck out of the one in plaintiff’s possession, but was left in the one delivered to defendant. They also differ, in that the one plaintiff has was executed “Albert Crane by Wm. B. Wesson,” while the one in possession of defendant was signed “William B. Wesson,” making no mention of Crane. It is evident to my mind from the case made, that each was intended to be a copy of the other, and that through- some inadvertency Wesson’s name was not stricken out of the one delivered to defendant, and it was signed by Wesson in his own name instead of Crane’s. Such being the facts, as I understand them, does the mistake vitiate the contract ? I think not. Duplicates are not separate parts of a contract, each as. essential to the existence of the contract as the halves are to a whole. Each is complete in itself: each.is the contract between the parties: each is an original, and not a part or copy of the other. And when from accident or mistake they happen to differ from each other, the only question is which is genuine and which is spurious. When that is ascertained, I know no reason why an action may- not be sustained on tbe one that truly states the contract between the parties. This would seem to follow if duplicates are originals: if each is a whole in itself, and not a part of a whole. When it can not be shown which is genuine and which spurious, the .¿action must fail; not 'because there is no contract, hut for the want of evidence to prove it.
An agreement for duplicates in reducing the contract to writing, that each party may have the contract in his possession — which would seem to be tbe principal if not only object of duplicates, unless it may also have in view the greater security of the contract against loss or accident — ■ it does not appear to me is a part of the contract itself, but a subsequent collateral agreement, which, if not carried out by reason of a mistake in drawing one of tbe duplicates, does not annul the contract.
On the other points made on the argument I am also with the plaintiff. It is not, however, necessary that I should give my reasons, as a majority of my brethren are in favor of reversing the judgment.
Judgment reversed. | [
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] |
Christiancy J.:
It is objected by the counsel for the complainant, that this case does not appear to have been made and notice thereof served within ten days after notice of judgment, nor that notice was given to appear before the judge who tried the cause to have the case settled according to rule 81 of the Circuit Courts, and that the right to have the case settled is therefore waived under rule 82.
It .is a sufficient answer to this objection to say that the want of these prerequisites does not appear. The case appears to be duly signed by the Circuit Judge, and purports to have been settled before him. All the previous steps necessary to its settlement must therefore, at least in the absence of any showing to the contrary, be presumed to have been regularly taken.
It is further objected that no notice can be taken of any defect in the summons or its service, because the right to make a case for review in this court, under this statute, is confined to questions of law arising upon the evidence.
However this might he under §3438, Compiled Laws, (upon which we give no opinion) we are satisfied that §3421 Comp. L. gives a general power of making a case after judgment for review in this court; and that, under this section, a case may be made containing the record, or a statement of so much of it as may be material to the questions to be raised, and that, when the case is so made, any question arising upon the record, as stated or set forth in the case, is properly subject-'to adjudication in this court.
It is further objected by the counsel for the appellee that §4998 Compiled Laws, providing for an appeal from the Commissioner, had the effect, at the time of its j>assage in 1846, to incorporate §140 Ch. 93 Revised Statutes of 1846: that this section being repealed by the subsequent act of 1855, section 184 of the latter (Comp. L. § 3836), takes the place of § 140 Revised Statutes of 1846, Ch. 93, and governs the appeal in this case; and that to enable the defendant to take advantage of the defect in the summons or its service, the affidavit of appeal must have been special, under the rule stated in Chaffee v. Thomas, 5 Mich. 53.
Whether the appeal is to be governed by the statute of 1855, it is not necessary to decide; nor can we entertain any objection to the affidavit on the appeal. The case, as made, presents no such question. It does not set forth the affidavit, nor state its nature of its substance. It merely states that “the defendant duly removed this cause into the Circuit Court by appeal.” If, therefore, a special affidavit was necessary, we must infer that it was made, as the objections to the summons and its service were formally made in the Circuit Court, and expressly passed upon and overruled by the court, and no objection appears to have been made to the sufficiency of the affidavit.
This brings us to the main question in the case. Did the Commissioner or the Circuit Court obtain jurisdiction of the proceedings?
The case states the summons to have been issued on the ninth of January, made returnable on the twelfth, and served on the tenth.
By the statute under which alone the proceedings were authorized (Comp. L. §4987), the summons must command the defendant “ to appear at a time and place therein to be specified, not less than three, nor more than six days from the issuing thereof.”
This language excludes the day of issuing, and, we think, clearly indicates the intention to require three entire days after that day and before the return. Here are but two (the tenth and eleventh) without including the return day, and this can not be counted and yet leave three entire days before the return.
By the next section, §4988, the service is required to be “at least two days before the return day thereof:” this necessarily excludes the day of the return. The summons was therefore made returnable at least one day too soon, and the service, had the summons been good, was at least one day too late. Both the summons and the service, if not void, were certainly voidable at the option of the defendant. If it was competent for the defendant to waive these defects, we think he did nothing which can be construed as a waiver. On tlie return day, he moved to quash and dismiss for these defects. The Commissioner took time for rendering his decision upon the motion; the complainant Stipulated to submit the motion without argument if defendant would plead to the complaint, whereupon defendant pleaded not guilty, and the cause was continued. It would be merely preposterous to say that defendant, by this, waived his motion. The plea must be treated as provisional only; it did not deprive the defendant of the benefit of his motion, either before the Commissioner or in the Circuit Court. No jurisdiction was acquired by either, and the case should have been dismissed.
This conclusion renders it improper to consider any question raised upon the merits. The judgment must be reversed, and the defendant must recover his costs in both courts, as well as before the Commissioner.
The other Justices concurred. | [
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] |
Manning J.:
Thomas Ryan, being the owner of a farm consisting of two forty acre lots, on the fifteenth day of September, 1845, by indenture of that date, between himself of the first part, and Patrick Ryan, his son, of the second part, in consideration of one dollar, did “grant, bargain, sell, remise, release, alien and confirm unto the said party of the second part, to his heirs and assigns .forever, the one-half of his farm, consisting of forty acres, more or less, namely: The N. E. qr. of the N. E. qr. of section 12, town Y N. of range 10 E., the said party of the first part reserving to himself the other part of said farm, namely: the N. W. qr. of the N. E. qr. of section 12, town seven north of range 10 E., for and during his natural life, and after his decease, the said N. W. qr. of the N. E. qr. to revert to the said party of the second part, and his heirs forever.”
The only question in the case is, whether by this conveyance the lot first mentioned, only, passed to the grantee, or both lots, with a reservation ¡'of a life estate to the grantor in the last mentioned lot.
As stated on the argument, the language of a deed is to be construed most strongly against the grantor, and so as to give effect to the intention of the parties appearing on the face of the whole instrument. In the present case, the operative words of the grant are confined to one lot, and the court is asked to extend them to both lots, on [the ground that the grantor intended to convey both. To give eifect to the intention of the grantor in such a case, the intent should so clearly appear on the face of the deed as not to leave a reasonable. doubt in regard to it, and no principle of law should be violated in carrying it out. The grantor may have intended to convey the northwest quarter to his son, but the words following the grant of the northeast quarter, relied on as showing such intention ,of the grantor, we do not think sufficiently clear and free from ambiguity for that purpose* The language is, “the said party of the first part reserving to himself the other half of said farm, namely: the N. W. qr. of the N. E. qr. of section 12, town Y north of range 10 E., for and during his natural life, and after his decease, the N. W. qr. of the N. E. qr. to revert to the said party of the second part, and his heirs forever.” By these words, the grantor may have intended nothing more than to designate the half of the farm he intended to keep for himself, and his then intention to give it to his son at his death. This is quite as probable as that he intended to give his son at that time the whole farm. We use the word give, as the part conveyed (the conveyance being from father to son, and the consideration nominal, but one dollar) was most probably a gift, and not a sale. For these reasons, we think the judgment of the court below should be affirmed.
Martin Ch. J. and Christiancy J. concurred. | [
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] |
Campbell J.:
In this case a mandamus is asked for to compel the Auditor General to reject the taxes upon certain lands, which were patented to the relator in 1859, on the ground that they are military bounty lands granted for services rendered during the war of 1812. By the compact under which Michigan was admitted into the Union, it was agreed that such lands, “ while they continue to be held by the patentees or their heirs,” shall be exempt from taxes “for the term of three years from and after the date of the patents respectively.” — Comp. L. p. 40.
The construction put upon this act by the Auditor General confines the exemption to three years from the location of the lands, and not from the date of the patent. The object of the law was to enhance the value of the land, and consequently of the scrip, by an exemption from taxation for three years from the time when a complete title in fee became vested, unless the title should be changed after such vesting. The language of the statute is so clear and free from ambiguity that it is not open to construction. The dale of the patent is the starting point mentioned, and was probably selected for its certainty and com venience of proof. We have no more right to select the date of location than the date of the bounty warrant or any of its assignments. We are bound to apply the clear language of the law precisely according to its tenor. The lands can not' be taxed until three years from the date of the patent, unless previously sold by the patentee or her heirs.
It is claimed, however, that this is not a proper case for a mandamus, because no clear duty lies upon the Auditor General which the relator has any interest in requiring him to perform.
We think a duty is laid upon that officer to reject such taxes, whenever “ he shall discover before the sale, or before the conveyance of any¿ lands, as aforesaid, that the same were not subject to taxation at the date of the assessment of the taxes.” — S. L. 1858, p. 186, § 99. As it was argued that the statute was silent as to a rejection of taxes, and merely authorized him to forbear selling, we deem it proper to refer to some [sections which may throw light upon this subject.
By section 858 of the Compiled Laws, all lands returned to the Auditor’s Office upon which the taxes “ shall not be paid, or be charged back to the proper county,” are required to be sold as pointed out by the statute. By section 889, the Auditor General is required in all cases where taxes upon lands returned delinquent to his office “ shall be rejected for any cause f to “ charge the same over to the county from which such taxes were returned,” unless the lands have been set off to another county. This section occurs in a subdivision entitled “ Of Rejections and Re - assessments,” which title has been preserved in the various tax-laws for many years in precisely the same connection. The object of charging back these taxes is to offset or discharge the credit already given to the county for the same taxes when first returned to the Auditor’s office. When so charged back, they are to be re-assessed upon the same lands, if rejected for mere informality, or upon the whole township, if absolutely illegal; — 1 Comp. L. §§ 888 to 893.
It is very evident that this action contemplates an absolute rejection and annulling of the taxes referred to, leaving them no longer in existence for any purpose. It is also plain that the statute contemplates that such rejection may be made before sale. No taxes can be charged back without putting an end to them, and sales are to be made for all taxes not charged back or paid: — Comp. L. §858.
If we now look back to ascertain in what cases the Auditor General can thus dispose of taxes returned to his office, we find no section relating to any interference with such taxes before sale, except section 881 of the Compiled Laws, which is amended by the law of 1858, and now reads as follows: “If the Auditor General shall discover before the sale, or before the conveyance of any lands, as aforesaid, that the same were not subject to taxation at the date of the assessment of the taxes, or that the taxes have been paid, he shall forbear to cause the same to be sold, or withhold a conveyance after sale, as the case may be; and in such case, if a sale has been made, he shall, on demand, cause the money paid therefor to be refunded, with seven per cent interest thereon.” — S. L. 1858, p. 186.
This forbearance to sell could not reasonably be supposed to be only[temporary, when the only causes authorizing it go to invalidate the tax entirely. And, as this is the only provision allowing such taxes to be interfered with before sale, it is manifestly the “ rejection” contemplated by the subsequent sections, which require the same taxes to be charged back and re-assessed. A rejection followed by such consequences is a total and absolute remission or rejection of the taxes, and the subsequent sections, therefore, referring to it, use a phrase entirely appropriate.
The law requires the Auditor to take this step, whenever he shall discover the facts which show the illegality. He has no discretion when such a discovery is made. We can not imagine that the law designed that he should be compelled to make investigations without any clue into the condition of the numberless lands returned delinquent, nor that parties aggrieved by the existence of unlawful liens on their lands should be prevented from applying for a remedy. While he may act on his own motion, it is very plain that the statute creates also a remedy for the persons interested in avoiding the tax. And when they make out, as the relator has done here, a case not open to any doubt, and which is«not disputed, the Auditor is bound to set aside the illegal taxes.
This is the practical construction which has always been considered as settled in this State. The action of the department has been very generally based upon appliea tions from the injured land owners. We do not think any other would carry out the design of the law.
The mandamus is allowed, directing the Auditor to reject the taxes in question.
The other Justices concurred. | [
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Campbell J.:
The bill in this case was filed to restrain the enforcement of a writ of attachment against certain lands alleged to have been conveyed to complainant by the attachment debtor, with knowledge in the defendant before the attachment was sued out. An answer was put in and replied to, and au order was made to examine witnesses in open court. The case being noticed for hearing on pleadings and proofs, the Circuit Judge refused to permit any wit nesses to be examined, and dismissed the bill for want of equity. The answer, in addition to meeting the facts, claimed the benefit of a demurrer upon this ground.
It is a well settled rule in equity that if the bill does not make out a proper case for relief, no relief can be granted under ’any state of the pleadings. Where this objection is taken by general demurrer, no question of fact can be discussed, because the bill is, for the purpose of the hearing, taken as true. But where an answer is put in, the defendant raises issues of fact upon all matters not admitted, and either party acquires the right, if it be replied to, of introducing evidence, so that if the court where the case is pending, or the apjDellate court, should regard the bill as presenting a case proper for hearing, the truth of it may be determined on the hearing. The right of appeal is an absolute one, and the appellate court acts upon the case by what is equivalent to a re-hearing. If in the appellate tribunal the bill is regarded as a proper one, the parties are entitled to have a decree passed upon the merits. By refusing to admit any evidence, the Circuit Court prevents this, and leaves the case where the appellate court can not pass upon it as justice requires. Any decree, therefore, which is made before the parties have had an opportunity of introducing such proofs as they have a right to submit, has the same effect as a premature hearing, and should not be allowed to stand.
Without now deciding upon the validity of the bill, because the case was not presented in such a shape as to make it ripe for decree without proofs, we feel constrained to reverse the decree, and remit the cause to the court below to be re-heard upon pleadings and proofs. Our action is not to. be regarded as alfirming or settling the right of the complainant to seek relief in such a case as he has made, but simply as requiring the case to be disposed of according to the rules, which are necessary to render appeals adequate to a complete disposition on the issue.
Manning and Christiancy JJ. concurred. | [
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Cambbeel J.:
The bill in this cause is filed to redeem certain premises covered by securities now in the hands of the defendant, Peter C. Niver, a part being subject to an ordinary mortgage, and in a part of which he holds the legal title, and an equitable mortgage of the equitable title.
March 10, 1852, complainant, owning one undivided third of the south west quarter of section 27, and of the north west quarter of section 84, in town 9 north of range 9 east, in Lapeer county, upon which was a saw mill, purchased the remaining two-thirds of George and Henry Niver, by an ordinary land contract, payable in annual payments, the last being a sum of fourteen hundred dol lars, payable June 1, 1855, in lumber, at market prices at East Saginaw. In June 1855, the legal estate which had been in George and Henry Niver, was vested in Peter C. Niver, by quit claim deed, dated June 5th, and recorded June 22d.
John Shafer, the complainant, was also the owner in fee of two quarter sections of lands immediately adjacent, and constituting, with the two quarter sections described, one section, namely, the south east quarter of section 28, and the north east quarter of section 33 of the same town and range.
June 1, 1854, complainant entered into a contract with Byron W. Clark, in the following terms:
“Memorandum of an agreement, made and entered into on this first day of June, a. d. 1854, by and between John Shafer, of Lapeer, Lapeer county, and State of Michigan, of. the first part, and Byron W. Clark, of the city of Buffalo, in the State of New York, of the second part, Witnesseth, that the said Shafer agrees to sell and deliver to the said Clark, at Lower Saginaw, in the State of Michigan, in the months of May and June next, all the merchantable pine lumber manufactured at his mills in the township of Marathon, in the county of Lapeer aforesaid, but not to be less than one million feet, of which one-fourth is to be clear and fourths, at the following prices, subject to eastern inspection : clear at sixteen dollars and fifty cents per thousand feet, and common at six dollars and fifty cénts per thousand feet. And the said Clark agrees to receive of the said Shafer the above mentioned lumber at Lower Saginaw aforesaid, at the time above mentioned, and pay him for the same at the rate of sixteen dollars and fifty cents per thousand feet for the clear, eleven dollars per thousand feet for the fourths, and six dollars and fifty cents per thousand feet for the common, upon the inspection, piling, and delivery of the lumber as aforesaid; and the said Clark agrees to advanc to the said Shafer the sum of one thousand dollars on the execution of this agreement, by paying the same to Palmer River, to apply on a certain land contract made by George and Henry River to said Shafer, and also the further sum of two hundred dollars for each and every one hundred thousand feet sawed and properly put up at the said mills, in Marathon aforesaid, between the first of August next and the fh-st of November next, and after that time and until the delivery of said lumber at Lower Saginaw, as above specified, to pay the said Shafer four hundred dollars per one hundred thousand feet, sawed and put up as aforesaid, at the mills aforesaid, upon the proper certificate of some person who may be selected or agreed upon by the said parties, and the balance, after deducting all advances which shall have been made, to be paid on the delivery of said lumber at Lower Saginaw as aforesaid; and it is mutually understood that the said parties hereto shall pay in equal ¡portions the charge for inspection, and for the dockage of said lumber at Lower Saginaw as aforesaid, and that the said Shafer is to defray all expenses of sorting and piling, and the lumber is to be sorted and piled as the said Clark or his agent may direct, at a good and convenient point for shipping ; and it is further agreed between the said parties hereto, that the said Shafer shall have at least two hundred thousand feet of said lumber sawed and put up as aforesaid at his said mills in Marathon, as aforesaid, in the month of August next; and the said Shafer further agrees to manufacture the said lumber of such thickness and dimensions as the said Clark or his agent may direct, or as Pascall Richardson of Tuscola, and John Pierson of Marathon, may say would be fair and right between the parties hereto.
“And it is further agreed that the said Clark is to be allowed interest upon all moneys advanced to said Shafer, until the delivery of said lumber at Lower Saginaw as aforesaid. It is further agreed by and between the parties hereto, that if the said Shafer shall not be able to deliver the said lumber at Lower Saginaw, as aforesaid, by the time specified, that then and in that case, upon the payment of one thousand dollars to said Clark as his damages, the said Clark agrees to allow the said Shafer until the middle of October next, to deliver the same. And it is further mutually agreed by the parties to this contract, that the damages in consequence of the non-fulfillment of said contract by either party shall be and the same are fixed at the sum of ten thousand dollars. It is also mutually understood between the said parties hereto, that the said party of the first part shall take care of and pay the balance due upon the contract between himself and George and Henry Niver, upon the first day of June, 1855, being fourteen hundred dollars; and also to save harmless the said party of the second part from the payment of a certain mortgage made by the said Shafer and wife to James Reynolds, Seymour Foster, and Quincy Johnson, which it is understood shall be one of the conditions in the fulfillment of this contract. It is also further understood that ail of the logs cut from the property known as John Shafer mill property, in the town of Marathon, and containing six hundred and forty acres, before the first of June next, or the lumber manufactured from the same, shall go to the said party of the second part under the terms and conditions of this contract, whether they may be saAved at Marathon, or in SaginaAV. In witness whereof* fhe said parties hereto have hereunto set their hands and seals, this 5th day of June, a. d. 1854.
John Shaker, [l. s.]
Byron W. Clark, [l. s.]”
To secure the performance of this contract, complainant executed a mortgage of the half section owned in his own right, and of the one-third of the other half section which was also in his name, and made an equitable mortgage of the two-thirds interest held under contract from George and Henry Fiver. The mortgage to Byron W. Clark was called a trust deed, and Clark gave back a lease to complainant. But the instrument being on its face a common law mortgage, no question can arise’ upon its legal character. This contract was transferred with the securities to Peter C. Fiver, May 30, 1855.
As the transactions are somewhat complicated, the first question which arises is whether the land contract became absolutely forfeited by non-fulfillment at the day of payment. The parties had not treated time as essential before, and there is nothing peculiar in the contract itself, which removes it from the ordinary rule. We think, without dwelling upon the circumstances alleged to have made a tender or its equivalent, that the parties were not authorized to regard it as absolutely forfeited beyond redemption. In this respect, we think the decree below allowing a redemption of it was correct.
But the principal controversy has been concerning the extent of Peter C. Fiver’s mortgage claim, which covers the land under contract, as well as the rest. It was held below that complainant had fully performed, and therefore that the mortgage wras cancelled. Defendants claim that he was in default, and is liable for damages, and that the decree in this respect is erroneous.
Clark’s duty under the contract w'as to advance at its date one thousand dollars; to advance $200 upon every hundred thousand feet sawed and put up at the mill between August 1st and November, 1854, and $400 per hundred thousand feet on all sawed and put up thereafter, the balance being payable on delivery at Lower Saginaw. Shafer agreed to have two hundred thousand put up in August. In case he did not deliver the lumber in time at Lower Saginaw, he was at liberty, on paying $1000, to have the time postponed until the middle of October.
Clark advanced the first $1000, and also a further sum of $100, which was not due under the contract in August 1854. As there was not a hundred thousand feet put up at the mills in that season, he was not liable to advance any more before delivery. The failure of Shafer to have two hundred thousand feet put up at the mill in August, appears to have been regarded as material only in excusing Clark from making further advances. As the lumber was to be delivered at Lower Saginaw, it is difficult to perceive how it could affect the case otherwise. Neither Clark nor Shafer seem to have considered it as affecting in any way the important rights of,the parties. It could not form any tangible basis for anything beyond nominal damages.
It appears from the testimony of Mr. Wattles, that in March or April, 1855, Clark and Shafer had a settlement upon the basis of ending the contract, and that Shafer agreed to pay Clark for his advances twenty-five hundred dollars. The amount then due was only the sum of $1100 and interest, for advances. But it is manifest from the testimony of Bonesteel, that Shafer did not expect to bo able to carry out the contract, or to raise the $1000, upon which it was to be extended, and it is also in proof that the contract was likely to be a losing one to him. Clark, however, appears to have been anxious to get out of it also, probably from want of means, as there is some testimony bearing that way. At the end of May, it appeared that all the parties were in Buffalo, where Clark sold out to Peter C. Niver (through Henry Niver) for $2250, after firrt offering it to Shafer on the same terms. Before Niver purchased, Shafer represented the interest as worth $2500.
Looking at the whole case, we are of opinion that both Clark and Shafer regarded the contract as at an end m April, and that the only claim left was for damages. Although the agreement then made by way of compromise may have been deficient in some legal particulars, yet inasmuch as Shafer represented to Niver that Clark’s rights were worth $2500, ■ we think the purchase so made should be protected. Nor do we think that Shafer could be permitted by his subsequent acts to avoid it. The contract having been terminated so far as it remained executory, the parties could not be required to' hold themselves in readiness to perform it.
Whatever might have been the effect of Shafer’s acts towards performance, had the contract remained open, they were evidently done without any bona fide expectation that they would be anticipated, and they were plainly designed to secure an unfair advantage. They can not, in the view we have taken, affect the case, and we are not called on to determine what they might have amounted to if material.
The decree below was erroneous in not allowing the mortgage lien of the defendant, Peter C. Niver. It must be reversed, and a new decree entered, establishing the amount of the mortgage against the complainant, executed to Byron W. Clark, June 1, 1854, on his estate in fee at |2500 and interest, from June 1, 1855, and the equitable lien on the land contracted, for the same debt, in addition to the balance of purchase money of fourteen hundred dollars and interest from June 1, 1855. Six months from July 11, 1861, are to be allowed for making payment, and in default, the land is to be sold, on the usual terms of mortgage sale, first selling the contracted property and applying the proceeds to the contract of sale, and the balance on the debt of $2500 and interest; and if there be any further deficiency in the latter debt, making it up by sale of so much as is necessary of the lands covered by the trust mortgage. The defendants are entitled to costs of both courts.
Martin Oh. J. and Christiancy J., concurred.
Manning J., did not sit in the case, having been counsel for one of the parties. | [
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Christiancy J.:
The original bill in [¡this cause was filed to obtain a reconveyance of certain lands, claimed to have been conveyed by complainant to Leeour, as security only, for a debt which it alleges to have been paid. It also claims that a subsequent deed of the same lands, executed by complainant to Leeour, was obtained by fraud; alleges a conveyance by Lecour to defendants John P. Juif and Theophilus Juif, with full notice on the part of the purchasers of complainant’s rights. It appears from the original bill, taken in connection with the subsequent bill in the nature of a bill of supplement and revivor, that all the other defendants derive their interest and title through this conveyance, in part by purchase alleged to be without consideration and with notice, and in part by inheritance from John P. Juif, who died after the filing of the first bill. The merits depend wholly upon the pleadings and proceedings in the original suit.
The answer of Lecour to the original bill denies all the material facts stated in the bill, and fully meets and controverts all the equities of the complainant: and though the answer is not evidence (the oath being waived), it still has the effect to put the complainant to the proof of his case, and without such proof it is admitted no decree could be obtained against Lecour.
But the other defendants, whose rights were derived from Lecour, did not answer; and, as to them, the bill was taken pro confesso.
Mr. Bates, who appeared as solicitor, and put in the answer for Lecour, before entering an appearance for any of the defendants, had stipulated with complainant’s solicitor to appear for all the defendants; but he never entered an appearance nor filed an answer for the other defendants, though the stipulation was filed; and upon the strength •of this stipulation, and claiming this as an appearance, the order pro confesso was entered. The case does not show that any subpoena was ever issued for the appearance of defendants. No proofs were taken, and the case was heard upon bill, answer and replication.
A question is raised by defendants, as to the authority of Bates to bind them by this stipulation; and his authority is put in issue by the answer to the supplemental bill. But we do not deem it necessary to discuss this question; because, admitting his authority, and that the filing of the Stipulation constituted an appearance of all the defendants, still we think the answer of Lecour must be held to enure to' the benefit of the other defendants, whose rights were derived from him, and dependent upon his. It is true the defendants, whose rights were derived from Lecour, might have other defenses, not available to him, and which they might have been able to sustain though his might have failed. Of all such independent defenses,, peculiar to them, they would lose the benefit by suffering the bill to be taken as confessed. But, on the other hand, if the case, as presented, shows no right as against Lecour, and is not such as to have invalidated his title had it still remained in his hands, the complainant can not possibly be entitled to the relief he asks as against the same title in the hands of Lecour’s assigns.
The answer of Lecour, until overcome by proof, was sufficient to protect his own title to the land had he never conveyed to the other defendants. We think it equally protected the same title in the hands of the purchasers and those claiming under them, and that they had a right to rest their defense upon that of their grantor, and to abide the result of his defense. And if, as claimed by complainant, Lecour’s solicitor was also the solicitor of tho other defendants, and they had no defense independent of Lecour’s, we can see no reason why ho should subject them to the expense of an answer, or encumber the records by a repetition of what already sufficiently appeared.
But it is said, Lecour was not a necessary party, and that the bill might have been filed against the other defendants alone. But though not perhaps a necessary, he was a proper party. Had the bill been filed against tho other defendants alone, there would have been no answer from him which could protect them; and they must have defended themselves or abandoned their rights. But upon "the bill as presented, the complainant has aimed to reach these defendants only through Lecour; and his answer interposes a shieid which protects their rights, as well as his own.
The decree of the court below, dismissing the bill, must be affirmed with costs.
Martin Ch. J. and Manning J. concurred.
Campbelb J. did not sit in the case, having been of counsel, | [
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The Court
held the appeal to have been taken in time, and denied the motion. | [
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Campbell J.:
Suit was brought below upon a bond made by Teller to the persons named as plaintiffs below and defendants in error, and judgment was entered on it by stipulation. The case now comes up on allegation of error in fact, because one of the plaintiffs below had died before action was brought. To this it is pleaded specially, first, that plaintiffs below were partners, and the cause of action survived ; and second, that there was a John P. Wetherell, a son of the -John P. Wetherell named as plaintiff living when suit was brought and judgment recovered. To these pleas a demurrer is interposed.
The demurrer is well taken. It is doubtless true that, upon the death of a partner, the cause of action survives to his associate. Had the declaration below shown such death, and been in the name of William Wetherell, as survivor, it would have been valid. But the action was brought in the names of both as living, and there is no rule of law which will permit a joint action to stand as several, nor is there any rule which will justify a judgment in favor of two plaintiffs to be regarded as in favor of only one of them. Where two plaintiffs are named, no recovery can be had unless both were entitled to bring the action at the time it was commenced.
The averment that another John P. Wetherell existed, is no answer to the allegation of error. The plea does not deny the death of the one named as plaintiff, nor does it aver the identity of the person living with such plaintiff, inferentially or positively, nor does it claim in any way that the cause of action arose in his favor. The averment that he is the son of the deceased plaintiff as well as his namesake, does not give them legal identity. The John P. Wetherell with whom the contract was made, was the only one of that name who could have sued upon it, and his death before action brought is not denied.
Judgment must therefore be entered in favor of the plaintiff in error, reversing the judgment below, with costs against William Wetherell.
The other Justices concurred. | [
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Campbell J.:
Defendant was sued upon a subscription to tbe stock of plaintiffs, made December 18, 1855. It appears from tbe finding, that tbe company bad been previously organized, by an original subscription and filing of articles under tbe General Railroad Law, and that five commissioners were named in tbe articles to open books for further subscriptions under the statute. Tbe amount of capital stock, fixed by the articles of agreement, was $180,000, divided into 5200 shares of $25 each. The directors, by vote June 14, 1855 (which was during the same month when the organization took place), passed a resolution instructing the commissioners to require payment of five per cent, upon all subscriptions when made. The court finds that the subscription was made on a subscription paper, circulated by an agent appointed by the board of directors, and that no books of subscription were opened. It is not found that the commissioners or any of them acted in the matter. It is found that the whole amount of stock was never subscribed. The directors called assessments from time to time, up to the full amount of each share subscribed. Defendant never paid any jmrtion of his subscription, but on divers occasions promised to do so. It is also found that he voted at a stockholders’ meeting after he made his subscription. The subscription is in the following terms:
“Dec. 18?7i, 1855. Schoolcraft and Three Miners Mail-road Company stock subscription. We, the undersigned, agree to take the number of shares of stock in the School-craft and Three Rivers Railroad Company, which is set opposite our names respectively, and bind ourselves, our heirs and executors, to pay for the same in monthly instalments, to the order of the president and directors of said Railroad Company, or their agent or attorney, for the purpose of constructing or building said road, whenever called upon so to do; which instalments shall not exceed twenty per cent, at any one time.
Names. Shares. Amounts.
Daniel Shuftz, 10 $250.00
Daniel Shurtz, 10 $250.00
To be paid in one year.”
The court below found the facts in writing, and made several rulings of law, which were excepted to. Judgment was given for the full amount claimed.
The principal legal questions arising on this finding, relate to the validity of the subscription, and the right to levy assessments upon it, if valid, before all the stock was subscribed.
The General Railroad Law contemplates that, after the organization is made legal, by filing articles in proper form after payment of five per cent, upon the preliminary subscription of $1000 per mile, the commissioners named in the articles shall open books of subscription to the capital. stock from time to time, at such places and on such notice as a majority of them shall direct; and shall keep open the books until all the capital stock shall be subscribed. Provision is made for an equal distribution in case the subscriptions exceed the sum fixed. After the whole sum is subscribed and distributed, they are to call a stockholders’ meeting to choose directors. L. 1855, p. 153-4-5, §§ 1, 2, 3, 4.
Those commissioners act as a statutory board, and derive their powers from the law and not from the corporation:-— Walker v. Devereaux, 4 Paige, 229. They are expressly required to give notice of the times and places fixed by them for receiving subscriptions, and to keep their subscription books open. The design of the law was to enable all persons to subscribe upon equal terms. No one else was authorized to receive subscriptions, and they were not required to recognize or protect in their distributions any stock not subscribed for on their own lists. It follows, of necessity, that no person could by any other means obtain any assurance that he would be entitled to any share in the concern, and any subscription made without such assurance would be void for want of mutuality.
It is unnecessary to decide whether the subscriptions must be made literally in books, although such a course would be certainly much safer and les», liable to mistake and abuse. Nor is the question whether, after the books are legally opened for subscription, any portion of the work may not be clone by single commissioners, or by clerks or other agents under the immediate inspection of the commissioners or some of them. The case does not find that the commissioners ever opened subscription lists, or did any other act required by law. If we were at liberty to look outside of the finding into the evidence, there is nothing to show any agency of the board whatever, and no proof that more than one of their number authorized any subscription. But the finding is entirely silent upon this. The statute requires a majority of the commissioners to determine when and where subscriptions are to be taken, and their duty continues until the whole amount of stock is subscribed and distributed. The subscription in question, not being made under their auspices, is not binding on them, and could not prevent other parties from taking the entire amount not subscribed by the original articles, whenever the commissioners should see fit to proceed and perform their duty. There was no consideration, therefore, on which to base Shuvtz’s promise.
We are also of opinion that, had the case found a legal subscription, any levy of assessments was premature. The case finds expressly, that all of the stock was not subscribed. How far the act of 3 857 modifies the power to call in subscriptions till this is done,- is immaterial in this case, as all that was done here preceded the passage of that act. It i? quite common in our special charters, and in some of our general laws, to permit corporations to proceed in the exercise of all their powers before their stock is all taken. When this is allowed, there is usually an express limitation, unless it is fairly to be deduced from other plain provisions. But the General Railroad Law (at least as it existed before the amendment referred to) contains no provision from which such an intent can be deduced. It allows each company to fix its own stock, but it must not fall short of $4000 per mile for flat rail, or $8000 per mile for heavy rail (see section 1). When we compare this provision with the requirement that the commissioners shall keep their books open until all the subscriptions are full, and then call a meeting to elect directors at which they are to act as inspectors (§§3, 4, 5), we can not resist the inference that the act was designed to prevent any company from proceeding without an assurance of genuine capital adequate to ensure the building of the -road entirely, or far enough to make it a safe security for loans to finish it.* Persons subscribing have a right to rely on the completion of the stock subscriptions, as some assurance that their means will not be absolutely thrown away. And it is fairly presumable that broad grounds of public policy, to prevent gambling in inflated securities, and obtaining* money under false appearances, were not left out of sight by the Legislature. Several cases were cited on the hearing, which held that the subscribers could not lawfully be called on to pay any assessments until either the whole stock or such minimum as the corporate law prescribed should be taken. The reasons given for this ruling are convincing, and ought to prevail.
Upon the finding of facts, we think the defendant below was entitled to judgment in his favor. The judgment below must be reversed with costs, and a judgment must be entered in his favor in this court. As the errors upon which we decide the cause arise upon the record, and do not impeach the finding, it is not a case for a new trial.
The other Justices concurred. | [
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] |
Martin Ch. J. :
The plaintiff employed the defendant to repair a carriage, and the defendant retained the carriage under a mechanic’s lien for the amount due him for making such repairs. To obtain possession of the property the plaintiff tendered, as the jury finds, sufficient to discharge the lien. This tender necessarily operated to release the property, and the plaintiff was entitled to immediate possession of it. That such would be the effect of an unconditional tender is not doubted; but as the tender in this case was made upon condition that the carriag’e should be delivered up, it is thought that it has not such effect. A tender made to procure the possession of property can hardly be called conditional because it is accompanied with a demand for the property. But it does not appear that any objection was made to the tender by the defendant, except for insufficiency — he demanding more than the sum offered; and as the jury find that sufficient was tendered, the tender was good, even were the strictest rule to prevail; upon the well established principle, that an objection made at the time of tender precludes all others, and if that be not well grounded, the tender will be held good.
It is claimed that the want of the money in court obviates the effect of the tender. Were this an action by Moore to recover compensation for the repairs, the want of the money in court would render the tender nugatory; as the effect of tender in such cases is to stay interest and relieve from costs, and therefore the party making the tender must always have the money within reach of his creditor. But in this case, the tender having once operated to discharge the lien, it was gone forever, and nothing could revive it. The reasons which require the money to be brought; into court do not apply in such a case. By refusing to receive the money tendered, the defendant lost his lien, and can only rely upon the per* sonal liability of the plaintiff.
The judgment is reversed, and a new trial granted.
The other Justices concurred. | [
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Manning J.:
Equity will not lend itself to enforce a penalty or forfeiture, as it would do in giving the relief asked. The case made by the bill, is a forfeiture by one of defendants of all her rights in a contract made with complainant for the purchase of a lot of ground in the city of Detroit, and assigned to her. The house in question was built by the purchaser after he took possession of the lot; and complainant having put an end to the contract, for the non-payment of a part of the purchase money at the time stipulated, as by the terms of it he had a right to do, claims the house under the forfeiture, and asks an injunction to prevent its removal. The decree dismissing the bill must be affirmed.
The other Justices concurred. | [
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Campbell J.:
This case depends entirely upon the power of a Circuit Court to allow an appeal from a justice after a transcript of the justice’s judgment has been legally filed in the Circuit Court. The statute must be taken together, and construed so as to harmonize its various provisions. In the section allowing the court, upon proper cause, to permit an appeal to be made, there is no limitation of time. But a transcript which can not be filed until a justice’s execution has been returned unsatisfied, becomes when filed of the same force as a judgment of the Circuit Court, and the justice has no further control over the proceedings: — 2 C. L. §§ 3832, 3786-7-8. We think this puts an end to the authority of the Circuit Court to grant an appeal. The order of the Circuit Court must be quashed for want of jurisdiction in the premises.
The other Justices concurred. | [
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Boyles, J.
Plaintiffs own lots 212 and 214 of Dewey’s Summer Homes, a recorded plat in French-town township, Monroe county. The defendant Major (also called Magyar) owns lot 213. During the course of the trial, the board of trustees of the Dewey’s Summer Homes Property Owners Association was added as a party defendant and filed an answer. It did not present proofs and has not appealed. Major will be herein referred to as the defendant.
At the rear of said lots 212, 213 and 214 is a park, platted as outlot E, with an alley separating said lots from the park. Plaintiffs filed this bill of complaint in the circuit court for said county to enjoin the defendant using the said alley and park as a sewage bed for a septic tank on defendant’s lot 213. The trial court granted the relief prayed for and the defendant appeals.
The facts are not in dispute. The defendant has constructed a septic tank on his lot 213, placed a disposal pipe across and below the surface of the alley and constructed a seepage bed for his septic tank under outlot E, extending it underground across the width of said park lot. Counsel for the parties have stipulated that the provisions of a certain “declaration of restrictions,” recorded in the office of the register of deeds for said county, apply to all lot owners in the subdivision, including the plaintiffs and the defendant. We quote so much of said restrictions as are necessary to decision:
“Now therefore, in consideration of the enhancement of the value of said property to said first parties, and to afford purchasers from them due and ample protection in the uses and occupancy thereof for the purposes for which it is designed, said first parties hereby declare that said real estate is held by them and will be conveyed by them subject to all of the restrictions, conditions, covenants, charges and agreements, hereinafter set forth, to-wit: * * *
■ “(11) Said first parties further agree to hold and reserve for park purposes, to be known as Washington, Jefferson, Madison and Jackson Parks, the outlots lettered A, B, C, D, E, P, Gf and H as shown on said plat and that said lot owners shall have the privilege of using said outlots for park purposes, subject to reasonable rules and regulations, until such time as said outlots are deeded by first parties as herein provided.
“(12) Said first parties further agree that when 80% of the lots shown on said plat are sold and fully paid for and deeds executed and delivered therefor, said first parties will convey by warranty deed to such trustees, association, corporation or per son as a majority of the lot owners shall in writing designate (each lot to have 1 vote) said outlots as aforesaid and said 400-foot beach parcel, said deed to provide that said outlots so conveyed shall be forever maintained as parks, and said 400-foot parcel as a park and bathing beach for the benefit of all the lot owners in said plat, subject to such rules and regulations, and with such improvements as a majority of said lot owners shall determine. * * *
“(15) Said first parties reserve title to the outlots to be used for park purposes and the 400-foot beach parcel until such time as the same may be conveyed as herein provided.
“(16) Said parks and 400-foot beach parcel are for the use of the owners of lots, their families, and guests. * # *
“(19) The rights herein reserved by the first parties for making improvements and care of the streets and parks and beach plot, may at any time be relinquished in whole or in part to a representative of the lot owners who shall be selected by a majority of the lot owners, each lot or the owner thereof having 1 vote. Such representative shall have the same rights and powers in respect thereto as first parties. * * *
“(21) All the provisions, restrictions, conditions, covenants, agreements and charges herein contained shall run with and bind all of said lots and lands and shall inure to the benefit of, and be enforceable by said first parties and the owner or owners of any of the lots or lands comprised within said plat, and their respective heirs, executors, administrators, successors and asigns, and the failure of first parties or the owner or owners of any of said lots or lands however long continued, to object to any violation or to enforce any provision, restriction, covenant, agreement or change therein contained, shall in no event be deemed a waiver of the right to do so thereafter as to the same breach or as to any breach occurring prior or subsequent thereto.”
Subsequently, under section 12, supra, the plattors conveyed to trustees, designated by the lot owners, the 400-foot beach parcel (not of importance here), “and also the following for park purposes, to be known as Washington, Jefferson, Madison and Jackson Parks, the outlots lettered A, B, C, D, E, F, G and H as shown on said plat. Also all of the streets, roads, ways, lanes, paths, alleys, easements, right-of-way, and other common grounds shown on the recorded plat of Dewey’s Summer Homes. Said out-lots so conveyed shall be forever maintained as parks and said 400-foot parcel as a park and bathing beach for the benefit of all the lot owners in said plat. The property conveyed herein to the named trustees shall be held in trust for the use and benefit of the lot owners of the subdivision of Dewey’s Summer Homes by said named trustees and their respective successors in office and as to said successors as fully to all intents and purposes as if a conveyance or transfer had place between said named trustees and said respective successors.”
We agree with the trial court that the construction and maintenance of a sewage disposal bed and the continued use of said alley and outlot E by the defendant for that purpose as an adjunct to his individually-owned lot 213 is an encroachment on and a violation of the rights of plaintiffs as lot owners, and that it is contrary to the recorded dedication, restrictions and conveyances hereinbefore referred to.
The trustees apparently concluded that their trust powers and duties required them to preserve only the surface of outlot E for its dedicated purposes. The unambiguous language of the trust grant and the restrictions negatives this interpretation as a matter of law.
Plaintiffs’ rights have been infringed upon. Defendant’s maintenance of a sewage disposal field in the park would affect the lot owners’ rights in any future improvements on said outlot E, which are specifically authorized by the terms of the dedication. The law requires that the trustees conform strictly to the directions of the trust. They may not rewrite their express trust powers in frustration of the unambiguous intention of the grantor of the trust.
Affirmed and remanded for enforcement, with authority to extend the time for enforcement for a reasonable period, with costs to appellees.
North, C. J., and Dethmers, Butzel, Carr, Bushnell, Sharpe, and Reid, JJ., concurred.
The plattors. | [
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] |
North, C. J.
This is an appeal by plaintiff from an order modifying a divorce decree. On October, 19, 1950, an interlocutory decree of divorce was entered, which, by embodying a property settlement, granted a certain piece of real estate on Norwood avenue, Detroit, to the wife and cross-plaintiff, Iva S. Isabell, appellee herein. At the time there was a mortgage on this property, the amount due being $2,200. The decree provided that Iva 8. Isabell should take the property free and clear of any claim or interest on the part of George A. Isabell, and it also ordered George A. Isabell to pay the $2,200 due under the mortgage. ' This decree was entered by stipulation of the parties. The present record does not indicate that the original decree made mention of any taxes then due on the property.
On December 16, 1950, appellee received a letter from Homer Warren & Company, agent of the mortgagee, demanding that certain delinquent taxes be paid. On December 26,1950, appellee filed a petition to modify the divorce decree so as to require appellant to pay the back taxes. In her petition she alleged that appellant had given false testimony at the friend of the court’s hearing, incident to the original case, in regard to his payment of the taxes, and had thus fraudulently led her to believe that the taxes were all paid. The particular testimony to which she made reference is as follows: George A. Isabell on cross-examination by Mr. Nayer, attorney for appellee, testified:
“Q. Did you pay the taxes on this property on Norwood?
“A. I paid all the taxes that has been paid on Norwood since April 6, 1936.
“Q. You paid all taxes up to the present out of your own money?
“A. Yes.”
In resisting appellee’s petition, appellant answered her contention of fraud by asserting that what he meant by his answer to the second question was that he had paid all of the taxes which had been paid up to that time out of his own money, which statement was true.
The lower court granted the petition of appellee, and required plaintiff to reimburse defendant for payment made of the accrued taxes in the amount of $968.46; and also to pay to the city of Detroit part 4 of the special paving assessment against the Norwood property in the amount of $53.62. In his opinion the trial judge stated:
“If there is any ambiguity in the words that he (plaintiff) used, having used the words he is responsible for the ambiguity and the other party had a right to rely upon the words spoken in their ordinary meaning. As the testimony now stands, cross-plaintiff was undoubtedly misled by this testimony of the husband.”
We are in accord with the conclusion of the circuit judge that plaintiff by his evasive answer as to his having “paid all taxes up to the present,” did mislead defendant, and also the trial court, in failing to provide in the property settlement portion of the decree that all taxes then due upon the Norwood property should be paid by plaintiff. At least, the record justifies the conclusion that plaintiff when entering into the stipulation with defendant as to the property settlement deliberately suppressed information which he possessed, but which defendant did not possess, and which resulted in failure to embody in the decree a provision that accrued taxes should be paid by plaintiff. Under such circumstances plaintiff’s contention that as a matter of law the court was without power to modify the consent decree as to the property settlement without consent of each of the parties to such modification, is not tenable.
The amended decree as entered in the circuit court is affirmed; provided however, that appellant shall have 20 days after the filing of our opinion herein within which to make such payments. Appellee may have costs of this appeal.
Dethmers, Bittzel, Carr, Bttshnell, Sharpe, Boyles, and Reid, JJ., concurred. | [
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Stone, J.
In this cause the bill of complaint was filed to obtain a decree to quiet the title of complainant in and to that portion of Franklin avenue, so called, lying east of the west 43 feet thereof, and extending from Montcalm street north 173 feet, in the city of Greenville. The bill alleges that on or about January 17, 1853, John Green, Manning Rutan, Morton Shearer, James B. Chamberlain, Abel French, George Loucks, Joseph Hart, Stephen Minard, and Stephen Rossman made and executed a certain plat of the village (now city) of Greenville, and caused the same to be recorded in the office of the register of deeds of that county. It is further claimed, and seems to be conceded, that there were no words of dedication used in any portion of said plat as executed by said proprietors, and the surveyor who surveyed the same, but that the streets, lanes, alleys, and public grounds of said village were described in said plat by giving the length, breadth, and points of termini, and were simply called by a name assigned them as streets, but there were no other words of dedication.
The complainant claims to own and hold the above-described premises by adverse possession. The defendant the city of Greenville answered admitting the plat substantially as alleged in the bill of complaint, but claiming that there had been an acceptance of the offer of dedication contained in the said plat, and claiming that the city had taken possession of said Franklin avenue and had expended public money in the improvement thereof, at least as to the west portion thereof, and claiming that it was lawfully entitled to hold and use the same as a public street in the city of Greenville. The other defendants in the case, Ambrose J. Ecker, Frank Wickham, and Elizabeth Wick-ham, were not made defendants originally, but upon petition were admitted as defendants, and they filed answers substantially the same as that interposed by the city of Greenville. These defendants claim to own, or to be interested in, the piece of property fronting on Montcalm street and lying east of the east line of Franklin avenue.
The record discloses the following descriptions of certain streets as contained in said plat, which plat is not fully set out in the record. The portion affecting Franklin avenue is as follows:
“(5) Description of Franklin Street: Commencing on the south line of said section nine, 26% rods west of the southeast corner of section nine, and 'running thence north four rods wide, 94 rods to the center of Montcalm street hereinafter described.”
“(14) Montcalm Street: Commencing on the east line of section number nine, 120 rods and 22 links on the north line of Grove street and running thence west 4 rods wide about 88 rods; thence west 15 degrees north about 74 rods to the southwest corner of lot number 76.”
“(16) Franklin Avenue: Commencing on Montcalm street at the north end of the west line of Franklin street and extending east eight rods wide; thence running north 8 rods wide to Loucks & Company’s millpond.”
The locus in quo is shown by the annexed diagram, known as “Exhibit D” in the record:
The record discloses some concessions and admissions of counsel which are pertinent and significant as to the extent of the controversy in this case. Upon proceeding to take the testimony in open court, counsel for defendants said:
“I appear for the city and the old office lot, Eckers and the Wickhams. Now, so far as the city of Green-ville is concerned, I would say that if Mr. Griswold concedes that line, drawn here by Mr. Anderson as the northern limit of Franklin, to be the north line or the end of Franklin avenue, so far as the city is concerned we will accept that as so, with one excep tion: That it cannot and does not affect the rights of the Wickhams as abutting property owners.”
In the brief of counsel for complainant we find the following;
“The defendants concede to the complainant all north of their dotted line across Franklin avenue, as shown in Exhibit D. The complainant does not claim the west 43 feet of Franklin avenue south of that dotted line. Consequently the land in dispute is 90 feet east and west by 113 feet north and south, located in an angle of the two streets as used and occupied.”
Taking counsel at their word, we think that the controversy is confined to the territory last above described, to wit, 90 feet east and west by 113 feet north and south, being the east 90 feet in width and 113 feet in length of Franklin avenue north of Montcalm street.
We have read the entire record with much care and are of the opinion that the circuit judge reached the correct conclusion in decreeing the property in question to be a legal public street and highway, and the right to possession thereof and title thereto to be in the city of Greenville for street and highway purposes, and in dismissing the complainant’s bill of complaint.
We are of opinion that the complainant has not sustained the burden of proof in this case necessary to show adverse possession of the premises in question. We should bear in mind that there is a broad distinction between obtaining title of land by adverse possession as against an individual, and gaining title to a portion of a city street as against a municipality. It has been said that this distinction lies in the fact that abutting property owners have the right against the world, and even against municipalities, to occupy and use the street in any reasonable way they wish so long as they do not interfere with the public travel thereon. In order to gain title by adverse possession to a portion of a public way, the occupancy must be such, as to warn the public that the occupant is going beyond his right as an abutting owner and is actually claiming the property as his own. It should be stated here that, under the evidence, the two buildings which were erected by the complainant, within the limits of what is claimed to be Franklin avenue, stand north of the premises which it is conceded by complainant’s counsel are involved in this litigation; that is, north of the point 113 feet north of Montcalm street. We are therefore not concerned as to the character or permanence of those buildings, as they are not within the territory with which we are dealing.
The record shows that, during the time the complainant claims to have been in possession of the premises involved, he was the owner of a strip of land adjoining to, and lying east of, the eastern boundary of Franklin avenue. We think that the owners of the land abutting on a public way may have the lawful right to use and exercise jurisdiction over it in any reasonable way they wish, so long as they do not interfere with the public easement, or obstruct the travel over the same. Thus it conclusively follows that acts upon and uses of a public way, which might well be evidence of a claim of title if individual property was concerned, may be no notice at all to the public that a title is claimed in a street or way.
Counsel have discussed authorities in other States, but we need not go outside of our own decisions to establish the principle as to occupancy which we have just referred to, and to show that the occupancy of the premises in question in this case was not such as to ripen into title by adverse possession. Possession, in order to ripen into a title to land, must be actual, continuous, visible, notorious, distinct, and hostile to that of the real owner. Smeberg v. Cunningham, 96 Mich. 378 (56 N. W. 73, 35 Am. St. Rep. 613), and cases there cited.
Acts of possession, in order to constitute adverse possession, must be such as, if seen by the party whose claim is sought to be divested, would clearly apprise him that the party doing the acts claimed the ownership of the property. Chabert v. Russell, 109 Mich. 571 (67 N. W. 902).
To constitute adverse possession it is necessary to show that the acts of ownership are of such character as to openly and publicly indicate an assumed control or use such as is consistent with the character of the premises in question. Whitaker v. Shooting Club, 102 Mich. 454 (60 N. W. 983); Murray v. Hudson, 65 Mich. 670 (32 N. W. 889). The character of the possession necessary to constitute adverse possession as against the public is well illustrated in the language of this court in Smeberg v. Cunningham, supra; City of Mt. Clemens v. Sanitarium Co., 127 Mich. 115 (86 N. W. 537). And bearing specifically upon the question as to public ways, see Village of Grandville v. Jenison, 84 Mich. 54 (47 N. W. 600); Marble v. Price, 54 Mich. 466 (20 N. W. 531); Village of Red Jacket v. Pinton, 126 Mich. 197 (85 N. W. 567). In the last-cited case it is said:
“When one seeks to obtain land against the public by adverse possession of a part of a street, he should make out a clear case, and the possession should be of such a character, and under such circumstances, as to warrant the conclusion that the municipal authorities must be held chargeable with notice of the adverse possession and with acquiescence therein.”
This court has said that the propriety of permitting title to be obtained in this way to a public highway is of more than doubtful expediency and is not common in other jurisdictions, although it has been sanctioned here when it has been clearly established. The policy of the State has now been changed by legislative enactment. See Act No. 46 of the Public Acts of 1907. This legislation, however, has no application here:
We find from the evidence in this case that, soon after the recording of the plat in question, which we should treat at least as an offer to dedicate the premises in question to public use, the then village authorities of Greenville proceeded to expend public money upon the west portion of the street in question and to use the same as a street. It has been repeatedly held that it is not essential that every part of the highway, in length or width, should be worked and traveled in order to show the intention of the public to accept the entire highway. Neal v. Gilmore, 141 Mich. 519 (104 N. W. 609); Nye v. Clark, 55 Mich. 599 (22 N. W. 57); White v. Smith, 37 Mich. 291; also, the authorities cited. This rule applies as well to common-law dedications, or dedications in pais, as to statutory dedications.
We think we have already said enough to dispose of the case, but it might be added that the record shows such a recognition on the part of the complainant and his grantors of the existence of Franklin avenue as being eight rods in width, as to estop them from claiming any part thereof. It appears that by repeated conveyances the complainant and his grantors have deeded premises bounding the same upon this avenue, thereby recognizing its existence. The purchasers of lots at once become vested with an interest appurtenant to the streets, including the rights of abutting owners in the streets upon which their lots abut, and they have a right to insist that the streets shall be kept open. This court, in Plumer v. Johnston, 63 Mich. 165, at page 173 (29 N. W. 687), said:
“It is also well established, with respect to a purchaser of lots described as bounded on a street, that the vendor is estopped from shutting it up so as to prevent his vendee from making use of it for his own accommodation in the enjoyment of his purchase. * * * The doctrine is well established that the grantee of a lot bounded upon a street or other highway takes to the center of such street, subject only to the public easement, unless something appears upon the plat, or in the terms of the conveyance, excluding the title from passing under a boundary so described.”
See Riedinger v. Railway Co., 62 Mich. 29-45 (28 N. W. 775).
The rights of an abutting owner in a city street are well settled in this State. Smeberg v. Cunningham, supra.
Whatever the irregularities were about the claimed dedication here, it is very evident that the intention to dedicate was present, and the attempt was made by the making and filing of the plat in question, and those who made the dedication and their successors under this record seem to have recognized and confirmed the dedication of this avenue by conveying the abutting lots with special reference thereto as a public way; and no one of them or their successors ever afterwards assumed jurisdiction or control of any of the lands comprehended within said avenue, or attempted to convey away any part of it, until we come to the conduct of this complainant.
The right to make a common-law dedication is not abridged by the statutory regulations providing for dedication of certain specific ways. People v. Beaubien, 2 Doug. (Mich.) 256-270; Baker v. Johnston, 21 Mich. 319, 340; Village of Grandville v. Jenison, supra. The language of this court in Michigan Central R. Co. v. Bay City, 129 Mich. 264-268 (88 N. W. 638), is appropriate.
As to what will constitute a sufficient acceptance of an offer to dedicate, it is settled in this State that it is not necessary that any formal action be taken by a municipality in order to constitute an acceptance of the highway or street, but making improvements and repairs and user thereof, or any portion thereof, are amply sufficient to constitute acceptance.
Under the concession of counsel, to which we have alluded, we think the decree in this case should be modified so as to embrace 113 feet in length, instead of 173 feet, and 90 feet in width, instead of 89 feet, as described in the decree. With this modification the decree of the circuit court will be affirmed, with costs to defendants.
McAlvay, C. J., and Brooke, Kuhn, Ostrander, Bird, Moore, and Steere, JJ., concurred. | [
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Ostrander, J.
It appearing that complainant’s premises were taxed for a special improvement a sum equaling 25 per cent, of its value, that there is no authority of law for a tax exceeding 5 per cent, of the value of the property to pay for such an improvement, except Act No. 707, Local Acts of 1907, that this act has been held to be invalid (Cote v. Village of Highland Park, 173 Mich. 201 [139 N. W. 69]), notwithstanding which a special roll has been prepared for the purpose of collecting the third installment (5 per cent.) of the said 25 per cent, tax, that the property has been returned delinquent for the first and second installments of the tax, of 5 per cent, each, that complainant is willing and offers to pay a tax of 5 per cent., that he became owner of the property while the improvement was being made, and is not by his conduct, appearing on the face of the bill, estopped to deny the validity of the tax, a demurrer to a bill filed to restrain the action of the village officers and of the village in proceedings to collect any tax exceeding 5 per cent, of the value of the premises was properly overruled. The case presented by the bill is not one of irregularity in the proceedings, nor is it denied that the property was benefited, and that complainant ought to pay such sum as the law permits the municipality to demand. It is the excess, the demand for a sum for which there is no warrant of law, that complainant objects to.
Decree affirmed, with costs to complainant.
McAlvay, C. J., and Brooke, Kuhn, Stone, Bird, Moore, and Steere, JJ., concurred. | [
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] |
Stone, J.
The relator presented its petition to the circuit court for the county of Muskegon, representing:
(1) That the public schools of the city of Muskegon is a school district organized under Act No. 281 of the Local Acts of this State for the year 1899; that all its business matters are managed and directed by a board of six trustees, styled by the act of incorporation the “Board of Education;” that the said board elects from its members a president, a secretary, and treasurer; and that the secretary of the said board is the respondent, Frank Hubbard Smith.
(2) That at a special meeting of said board, duly called, and held October 28, 1918, at which all the members were present, a resolution was unanimously adopted designating and establishing block 197 of the city of Muskegon, according to the revised plat, as a site for a school, and that said block was duly pur-. chased for a school site, and became the property of the district.
(3) That at a session of said board, called and held on the 20th day of February, 1914, the following resolution was adopted:
“Resolved, that it is necessary to hold a special election of the qualified electors of the public schools of the city of Muskegon for the purpose of passing on the following question: Shall the board of education be authorized to erect a school building on block 197 of the city of Muskegon, according to the revised plat approved April 9, 1903, at an expense of more than fifteen thousand dollars?
“It is further resolved, that the election shall be held on the_ 7th day of March, 1914, at the Hackley school building in the said district, from 3:00 o’clock to 8:00 o’clock in the afternóon, and that the secretary cause notice thereof to be given as prescribed by the school charter.”
That thereafter due and legal notice of the holding of said election was given as required by the act of incorporation, and said election was duly held on the day appointed in said resolution, at which election there were cast in favor of the said proposition 143 votes, and against the same 38 votes.
(4) That the board of education caused plans of said proposed building to be made, and thereafter entered into contract for the erection of the same, and said building was then in process of construction. That on May 27, 1914, at a session of said board of education duly called, at which all members were present, the following resolution was adopted by a unanimous vote of said board, viz.:
“Whereas, on March 7, 1914, the electors of the district at a special election duly called and held, voted that this board be authorized to erect a school building on block 197 of the revised plat of the city of Muskegon, at an expense of more than fifteen thousand dollars; and
“Whereas, in pursuance of said authority, this board has entered into a contract for the construction of such school building; and
“Whereas, the construction of said building, including the plumbing, heating, and wiring therein, the purchase of the site, and the improvement of grounds,
will cost $90,000.00 as near as the same can be estimated; and
“Whereas, it is deemed advisable and necessary to borrow the sum of $90,000.00 and issue bonds therefor, to pay for said school building, the site on which it stands, and the equipment of said building:
“Now, therefore, be it, and it is hereby, resolved:
“Sec. 1. That this school district, for the purpose hereinbefore stated, do borrow the sum of $90,000.00 and issue its bonds therefor.
“Sec. 2. That such bonds be dated July 1, 1914, and bear interest at a rate of not exceeding five per cent, per annum; that said interest be payable on the 1st day of January and July of each year, and be evidenced by coupons maturing upon the several dates when the same accrues; that such bonds be of the denomination of not less than $500.00 as may be desired by the purchaser or purchasers, be numbered consecutively, and mature as follows:
“Sec. 3. That the secretary of this board be and he is hereby instructed to advertise for sealed bids for said bonds to be filed in the office of this board on or before June 8, 1914, at 12:00 o’clock noon, such bids to be for the entire issue or for any part thereof, and to cover the, issuing of such bonds at either four and one-half or five per cent, per annum, this board reserving the right to reject any or all bids.” _
_ That bids for said bonds were asked for in accordance with said resolution and duly received, and the bonds had been negotiated, but that the respondent, the secretary of said board, declines to sign said bonds, on the grounds that the said board of education has no authority to borrow money and issue bonds, unless permission so to do is first-obtained from the qualified electors of the- school district given at an annual meeting, or at a special meeting called for that purpose, and that as no such election was had, and no such, consent given, the bonds were never lawfully authorized, and that if issued would be void.
The relator prayed that the writ of mandamus be issued, commanding the respondent, as such secretary, forthwith to sign and issue said bonds. An order to show cause was granted; and respondent in. his answer denied that, under the act in question and under the general statute (section 4717, 2 Comp. Laws, as amended by Act No. 12, Pub. Acts 1911), the relator had the power to borrow money and to issue bonds for the purposes claimed, unless it first submitted said question of issuing bonds to the electors of said school district; and it was admitted by respondent in his answer that, with the exception of submitting said question of issuing bonds to the electors of said school district, all steps taken by relator in relation to the issuing of said bonds were regular and valid, and that the amount of the proposed issue was within the statutory limits controlling the same.
Upon the hearing the circuit court issued the mandamus as prayed for, and the respondent has brought the case here upon certiorari, to review the action below.
By the provisions of Act No. 281 of the Local Acts of 1899 almost plenary power is given to the board of education. Counsel agree that the important question in the case is the proper construction of the last sentence of section 16 of the act, which reads as follows :
“Said board shall also have all the powers and privileges conferred upon school boards and upon qualified voters of school districts at any annual or special district meeting by the general school laws of this State not inconsistent with this act.”
This section was before this court in the case of Public Schools of Muskegon v. Smith, 178 Mich. 570 (139 N. W. 264). We there held that, under that sentence and the general school laws of the State, the corporation has the power to borrow money for building schoolhouses and to issue its bonds therefor. This precise question was not raised, as in that case the board of education had submitted the question of bond issue to the qualified electors of the district, and they had authorized the action.
In this case the board of education has been authorized by the electors to build a schoolhouse exceeding in expense the sum of $15,000, and it has proceeded to raise the funds by a bond issue without submitting that question to the electors, assuming that under the act or charter referred to it is the proper body to decide that question. The language of the provision quoted is clear and unambiguous. It provides that the board .of education shall have all the powers and privileges conferred upon qualified voters of school districts at any annual or special district meeting by the general school laws of this State, not inconsistent with the act. Section 4717, 2 Comp. Laws (4 How. Stat. [2d Ed.] § 9932), as amended, confers upon the qualified voters of school districts the power to borrow money and issue bonds therefor, to- pay for school sites, and to erect and furnish school buildings. The language quoted should be given its common and ordinary meaning. We are not aware of any constitutional provision that prohibits the legislature from vesting in the board of education the power generally exercised by the electors.
The power to borrow money is really granted to the corporation, the school district; but it is here, by the act, exercised by the board of education. A careful examination of the act, or charter, shows that the entire control and management of the schools of the district, or city, both in the conduct of the educational work and of the finances, are vested in the board of education. Aside from the election of the board, there are only two things mentioned in the act, where any power is to be exercised by the voters or electors of the district. By section 19 the board has no power to erect any school building, the expense of which shall exceed $15,000 unless authorized by the electors. By section 26 it is not authorized to raise by tax or loan an amount greater than the sum specified in section 24, unless authorized by the qualified electors of the district. In all other respects the powers of the district are to be exercised by the board of education. The provision in section 16, when literally construed, is therefore in exact accordance with the general scope and policy of the act, and gives the right to issue bonds to the board of education. It will be noted that the respondent admits in his answer that, with the exception of submitting said question of issuing bonds to the electors, all steps taken by the relator in relation to the issuing of said bonds are regular and valid, and that the amount of the proposed issue is within the statutory limits controlling the same.
We are of the opinion that the relator is right in its contention, and the order and judgment of the circuit court is affirmed, but without costs to either party.
McAlvay, C. J., and Brooke, Kuhn, Ostrander, Bird, Moore, and Steere, JJ., concurred.- | [
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] |
Bird, J.
In October, 1911, the defendant operated the Shiawassee coal mine, in Saginaw county. Electric currents were conveyed by means of wires from the surface into the mine and along the passageways to the mining machinery, lights, and pumps. The wires were fastened on the side wall near the ceiling of the passageways. The passageway leading from the shaft to the point of mining was nearly a mile in length, was about 5 feet wide, and 5 feet in height. Down this passage a track was laid, over which cars filled with coal were hauled to the shaft. Mules were used to haul the cars from the point of loading for about 600 feet, where they were then taken by the motor to the shaft. In going to and from their work, the men working in the mine went through this passageway. On the afternoon of October 12th the plaintiff, who was doing the work of a loader, having finished his work, started for the shaft through this passageway. He had not gone far, when he suddenly came upon a mule team returning with empty cars, and, being somewhat startled, he stepped off the track to allow them to pass. The narrowness of the passageway compelled him to hug the side wall, and in so doing his head came in contact with a section of the electric wire which had no insulation, with the result that he received a shock, and was thereby thrown forward onto the mules and in front of the moving cars, and injured..
The negligence complained of and relied upon was the failure of defendant to furnish him a safe place in which to work, in that it failed to insulate its wires at the point where he came in contact with them. Judgment passed for the plaintiff, and defendant assigns several errors thereon. The assignments of error raise the questions:
(1) Whether there was any actionable negligence upon the part of the defendant.
(2) Whether plaintiff was guilty of contributory negligence.
(3) Whether the injury was within the risk which plaintiff assumed by his contract of employment.
1. The relation of employer and employee, which existed between the plaintiff and defendant, raised a legal duty upon the part of the defendant to furnish plaintiff with a reasonably safe place in which to work, and this duty carried with it the obligation to see that the passageway through the mine leading to and from plaintiff’s work was reasonably safe. It is charged that defendant failed in this duty because it failed to insulate the wires at the point where plaintiff came in contact with them. It appears to have been admitted upon the trial that at that point there was a gap in the-boards which afforded protection against the wires. The assistant electrician testified it was a part of his duty to supply the gap, but that he had failed to do so by reason of the pressure of work elsewhere. The defendant /Caused the wires to be placed in the passageway. It recognized the fact that they were a dangerous agency, by adopting a policy of covering them. It also knew that the men traveled the passageway in going to and from their work. These facts, with other facts shown, were sufficient to carry the question of defendant’s negligence to the jury. But it is argued that the duty of covering the wires was delegated to the electrician, and that, as the proofs showed, he had an ample supply of boards to cover them, his failure to do so was his fault — the fault of a fellow-servant of plaintiff — and not the fault of the defendant. It was within the defendant’s right to delegate the authority to the electrician, but it could not do so in such a manner as-to relieve itself of liability, because the safety of a “permanent place” was involved. Van Dusen v. Letellier, 78 Mich. 492 (44 N. W. 572); Brown v. Gilchrist, 80 Mich. 56 (45 N. W. 82, 20 Am. St. Rep. 496); McDonald v. Railroad Co., 132 Mich. 372 (93 N. W. 1041, 102 Am. St. Rep. 426); Charron v. Carbide Co., 151 Mich. 687 (115 N. W. 718); Danula v. Mining Co., 166 Mich. 350 (130 N. W. 604).
2. Several reasons are assigned why plaintiff was guilty of contributory negligence as a matter of law. One of these reasons is that plaintiff should have stepped to the north side of the track, instead of the south side, to permit the mules to pass, because he was aware that on the north side there was more room and no wires. The plaintiff testified that he came upon the mules so suddenly that he became excited, and he appears to have followed his first impulse to avoid them by stepping to the south side. Recognizing, as we do, that one in a startled moment is not always able to exercise his best judgment in behalf of his own safety, we cannot say as a matter of law that he was guilty of contributory negligence. His conduct on that occasion, with all the attendant circumstances, must be referred to the usual test, namely, whether he did that thing which the ordinarily prudent and careful man would have done under similar circumstances.
It is further urged in this connection that, inasmuch as defendant was not responsible for plaintiff’s fright, it is not liable for the consequences. Had plaintiff stepped aside and suffered injury solely by reason of the narrowness of the passageway, this argument would have more force. The position of plaintiff, however, is that, notwithstanding his fright and the proximity of the car to the side wall, he would have escaped injury, had he not come in contact with the exposed wire. The uncovered wire was counted upon as being the proximate cause of his injuries.
The further questions as to whether, in the exercise of ordinary care, plaintiff should have seen and heard the mules sooner, whether he should have refrained from leaving the mine until the current was turned off, and whether he should have used another passageway, were questions which were all within the province of the jury, and the trial court was in no error in submitting them for their consideration.
3. Did plaintiff assume the risk? The risks which plaintiff assumed when he became an employee of defendant were those of which he actually knew, or of which he ought to have known. Balhoff v. Railroad Co., 106 Mich. 606 (65 N. W. 592); Bradburn v. Railroad Co., 134 Mich. 575 (96 N. W. 929). The plaintiff gave evidence that he was not aware of the gap in the insulation of the wire. As to whether the danger was obvious, and therefore should have been known to him, would depend upon the opportunity he had had for observing it, whether it was near or far from one of the 16-candle incandescent lights distributed every 150 feet through the passageway, whether the light carried on his cap would enable him to observe it, and whether his failure to observe it was due to his inattention and indifference. These considerations made this question one for the jury.
We find no reversible error in the remaining assignments of error.
The judgment will be affirmed.
McAlvay, C. J., and Brooke, Kuhn, Stone, Ostrander, Moore, and Steere, JJ., concurred. | [
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] |
Brooke, J.
In this proceeding, the relator, in the exercise of its right of eminent domain, sought to condemn a triangular piece of property located north of Sibley street between Cass avenue and Clifford street, in the city of Detroit. It appears from the record that the owner of said property and her predecessors in title had, for upwards of 25 years, occupied a strip of land within the street about 2% feet wide by 106 feet long on the Cass avenue side of said property. The petition for condemnation correctly describes the property to be taken, including this strip. It is conceded by the respondent in this court that necessity for the taking of the property in question was properly shown by the relator. Evidence was introduced on behalf of the relator, as well as on behalf of the respondent, as to the value of the property. That given on behalf of the relator fixed the value at from $5,500 to $7,000. That on behalf of the respondent fixed the value at from $10,000 to $15,000. After instructing the jury very fully as to their duties and the law applicable to the case, the following occurred:
“The Court: Is there anything you desire?
“Judge Donovan: I did ask your honor to .tell them that we could give a good title.
“The Court: I think you gave me some requests. I think, Judge Donovan, I have covered them.
“Judge Donovan: I think you have covered them, except, possibly, that one fact that we have a good and clear title here.
“The Court: He says, first: ‘That two things must be proven by a fair preponderance of evidence before the property in issue can be taken by the city from the respondent, namely: (a) That there is a necessity for such improvement; and (b) to agree on,and fix a just and fair value as compensation for the property.’
“Judge Donovan: That is covered.
“The Court: I think I have given the jurors that.
“Judge Donovan: I know you have.
“The Court: At least, I shall ask them: You so understand that, do you, gentlemen of the jury? I charge you that respondents are able to furnish a clear title to the premises, as described by the architect, including the entire land covered by the buildings, even that narrow strip used and occupied over 20 years by respondent. That, gentlemen of the jury, is a matter that belongs to the corporation counsel, who has to examine the titles of property before the city of Detroit would authorize a proceeding of this kind to be taken.
“Mr. Penniman: No, judge; just a moment, I think Judge Donovan is absolutely right. I think your honor should charge that the respondent is entitled to compensation for that property, which is within the building — the present building lines of the property. I understand that they have had title by prescription.
“The Court: That is described right in the petition.
“Mr. Penniman: No, it is not, your honor.
“Judge Donovan: I think it is covered by the petition.
“Mr. Penniman: I thought it was described as lot 145.
“The Court: Oh, no. Here is the description.
“Mr. Penniman: Is that a full description, Mr. Dooley?
“Mr. Dooley: Yes.
“Mr. Penniman: In the building line?
“Mr. Dooley: Yes.
“The Court: Then it is all right.
“Mr. Penniman: I thought it described just the lot line, not the building line.
“The Court: Follow an officer, gentlemen.”
The jury rendered a verdict in favor of respondent in the sum of $8,000. Respondent has removed the case to this court for review, claiming that the award is grossly inadequate, and assigning as a reason therefor certain remarks of counsel for the city during the examination of various witnesses. A fact worthy of note is that throughout the entire record there appears not a single objection to the admission or exclusion of testimony or to the remarks of counsel, nor is there a single exception noted.
Aside from this, however, we cannot agree with the claim of counsel for respondent that the jury were misled or influenced by the remarks of counsel to deny by their verdict compensation to respondent for the strip owned by her by adverse possession. That strip was included in the petition, and the colloquy between the court and counsel, quoted above, indicates very clearly that the jury must have understood that the respondent was entitled to compensation for that as well as for the property lying within the original lot lines.
While the award is much lower than any sum fixed by witnesses on behalf of respondent, it is $1,000 higher than the highest estimate of value placed upon the property by witnesses for the relator. It was fixed by an agency provided by law for that purpose, under very full and fair instructions from the court.
We are of the opinion that the judgment should be, and it is, affirmed.
McAlvay, C. J., and Kuhn, Stone, Ostrander, Bird, Moore, and Steere, JJ., concurred. | [
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] |
Campbell J.:
This case' comes before us upon a bill of exceptions from the Recorder’s Court of Detroit, before judgment. It appears that the prisoner was tried by the court without a jury, which he is said to have waived by consent of the Court.
The first question demanding attention is, whether a trial can be had without a jury, in" the Recorder’s Court, of a criminal prosecution.
The charter of Detroit recites that “ In all trials upon indictments, the person or persons upon trial shall he tried by a jury, unless the right to a trial by jury he, with consent of the court, waived.” Laws of 1851, p. 115, §33. The prisoner was not tried upon an indictment, but upon a complaint or information under the charter. The view we , have taken ,pf the law renders it unnecessary to determine whether the language of this section can be applied to [trials under any form of complaint except an indictment.
The charter, of the city leaves all proceedings in the liecorder’s Court, in the trial and punishment of criminal offenders against the general laws of the State, to be governed by the laws applicable in the Circuit Courts, which provide expressly that all issues of fact on indictment or Information shall be tried by jury. Comp. L. p. 1592; Laws of 1859, p. 301. In those courts there is no provision recognizing the waiver of a trial by jury. The charter does not authorize it expressly, but, if at all, by Implication. It does not point out how it shall be signified— whether verbally or in writing; nor when it may be made, nor whether it may be revoked. Neither dees it point out how the consent of the court is to be manifested of record, as it must be of necessity in order to make the record perfect if assailed on error. The law also makes no provision for the finding of the court for •or against the prisoner, nor when or how judgment shall be rendered upon it. Nor is there any statute by which any rulings of law can be reached, unless they arise upon the admissibility of testimony, and upon this there would be very great difficulty.
If the common law provided for such cases, the question might perhaps be reduced to one of power in the Legislature; first, to permit a waiver, of j a jury at all; and second, to permit it in one court, leaving all the ■other courts of the State to be governed by a statute forbiding it. But we can not find any common law practice by which these deficiencies can be rectified. The consequences would be too serious to allow us to assume that, by the silence of the Legislature, the court was to be allowed to take any conree which might appear proper. This could not be permitted in such cases under any known rule of construction. And even if it could, there are so many cases expressly provided for by statute which could not be affected by such implication, among which may be mentioned findings on cases of insanity, that the adoption of even such a broad rule would not remove many serious difficulties. We must, therefore, conclude that, until the Legislature go further and provide some machinery for the trial and review of criminal causes in courts of record without a jury, the clause of the charter referred to must remain inoperative to change the general law. We are of opinion that the Recorder had no power to try the case without a jury.
As wo are informed that the question of the authority of constables in the city of Detroit, is one which is giving occasion to a good deal of litigation, and requires settlement in order to insure the due administration of justice, and will also arise upon the trial of this cause, wo have with some reluctance determined to decide it, although the case is fully disposed of at this hearing without it. Wo have been aided by a very able and exhaustive argument, and are entirely satisfied upon it. While there are doubtless some common law incidents of the office of constable not attached to it here, where it is to a great extent regulated by statute, yet -we are of opinion that constables in Detroit, independent of the repealed section of the charter, possess the same general powers belonging to the office in towns: the charter, so far as it applies, being only designed to affect some local powers. It is impossible to give full effect to the jurisdiction of justices of the peace in the city unless this construction- is given to the statutes. It is very generally true that, when a statute provides for an officer by a known legal name, and with settled legal powers, the presumption of legal identity must prevail, unless repelled by strong circumstances. There is nothing in the legislation before us which indicates any repugnance. It could only be inferred by regarding the original section of the charter amended as the source of all the power of constables to serve process in cases like that before us. We do not think this presumption can fairly arise in view of the great body of statutes regulating the ministerial duties of these officers, which are strictly in accordance with the principles 'of tho common law, and would, probably, in the entire absence of special statutes, be substantially the same. The statutes were so fully reviewed on the argument that wo do not deem it necessary to enter upon a detailed examination of them. We think that the city constables remain ministerial officers of justices as before.
The case must bo remanded to the Recorder’s Court, as there has been no legal trial.
The other Justices concurred. | [
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] |
Martin Ch. J.:
We find no error in the action of the court in this case A regular judgment, after trial before the court, had been entered in March, 1860. At the same term, as it appears, a motion was made by the defendant to set aside the judgment, and for a new trial. This motion was virtually denied at the succeeding term. The act of the court amounted to an amendment of the entry of judgment, and to nothing more. This amendment consists simply in prefixing to it a finding of facts and conclusions of law; the judgment in. all other respects remaining the same. This amendment was, as I apprehend, entirely unnecessary, as the statute does not require such finding to be incorporated into the judgment. But it does not vitiate; it is mere surplusage.
The other Justices concurred. | [
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Campbell J.:
The hill in this cause was filed to restrain the collec' tion of -$11,718,34, being a balance claimed to be due from the complainants to the State of Michigan for specific taxes. The complainants claim that this amount of tax is made up of three fourths of one per cent on six separate items, all of which they insist are exempt from the tax. These items are set forth in the bill as consisting of, First, $300,000 of stock which is averred to consist of three thousand shares which it is alleged were issued in 1849, and delivered to the “then several stockholders of the company, without any consideration therefor, without any subscription being made for said stock, and without any promise from any person whatsoever to pay the amount or any part thereof to said company, nor was any capital directly or indirectly, actually or technically, paid to said company on account of said certificatesSecond, $185,-459,84 which is the amount of discount on the sale of company bonds below par; Third, $250,000 of bonds known as Jackson Branch bonds, which were never sold by the company, but were lent and disposed of by the borrower, who had turned out as collateral the bonds of the Chicago and Mississippi Railroad Company, which the complainants took on settlement and now hold, and which are averred to be worthless; Fourth, $466,848,02,^ being the cost of various steamboats, one of which was destroyed some years since, and the remainder are alleged to have been employed and taxed in other states, and of late have been unemployed and lying idle; Fifth, $300,000 lent by complainants to the Chicago and Mississippi Railroad Company, and secured by-worthless securities; Sixth, $60,136,-87 expenses incurred in 'obtaining loans and selling bonds.
Before inquiring into these items it becomes necessary to consider a question raised on behalf of the defendant, and which is claimed to preclude any investigation of these matters. It is insisted that the whole controversy is bound by a previous adjudication of the Supreme Court in the case of The People v. The Michigan Southern and Northern Indiana Railroad Company, which is reported in 4 Mich. 898. In that case three of these items were considered, and it is claimed, inasmuch as all of them then existed, the company became estopped by the decision, on the principle that what has become res adjudicata can not be disturbed. Without considering the technical defects of the answer and proofs on this specific defense, I think it is founded on a misapprehension of the rule. The only controversy in the record in that case, was whether a certain portion of the tax of 1855 was due and jDayable. That controversy only was disposed of; and if any estoppel arises it can not go further. Estoppels arise upon facts, and not upon questions of law. When the latter are decided, they have no further importance than as precedents. That case therefore has no bearing upon any question of law not, considered in it. How far it bears upon any of the questions now before us, under the new allegations and proofs adduced in this cause, I shall consider presently.
The first questions which I propose to examine are those not presented in that case, and which may therefore be regarded as new questions. And for convenience they will be taken up in their inverse order.
The complainants claim an exemption of tax on $60,-186,8^, paid out for commissions and other expenses attending the sale of bonds and the obtaining of loans. I do not perceive upon what ground this exemption can be claimed. The loans which caused these expenses were taxable. The expenses were mere agency expenses, in no wise differing from any other outlays for services. The law does not undertake to follow the money of the company to its several destinations. When once borrowed the company can use it for the proper objects; and should, I think, be held responsible for taxes on it, whether spent profitably or not. No business can be transacted without, some unproductive expenditures. The employment and payment of agents is an ordinary necessity, and it is always presumable that their services are worth what they cost. These charges form, I think, no cause of exemption.
The same objection applies to the demand to have a deduction from the tax on account of $300,000 lent by complainants to the Chicago and Mississippi Railroad Company. Having borrowed money which became taxable as a loan, the complainants did not cease to be debtors for the amount by lending it or giving it away. Such a loss might afford an argument for legislative relief, but it can not change their position as borrowers, nor diminish the amount of their loans.
The next item embraces the cost of the steamboats. It appears that one of them has been lost, and that the rest have been lying at Toledo unproductive, and have been taxed in Ohio. This .exemption is claimed on the ground that complainants are not taxable for any capital or loans not “ actually employed in the State of Michigan The third section of the act of consolidation between the Michigan and Indiana Company is relied upon for this exemption. That section is as follows: “ The said corporation so to be organized, by virtue of this act, shall continue subject to the same rate of tax as though such consolidation should not take place; and the amount of its capital and loans hereafter, upon which such taxation shall be paid, shall be such portion of the whole of its capital and loans as is actually employed in the State of Michigan,” &c. By the original charter, the Southern Railroad Company was liable to a tax of three-fourths of one per cent upon the capital stock paid in, and upon all loans made to the company for the purpose of constructing the railroad, or purchasing, constructing, chartering or hiring steamboats.
By imposing the tax on stock and loans, and exempt ing the company from other taxes, it is evident the design was to have a standard readily ascertained, and which was not likely to fluctuate. The chance of profit, without which no such work would be undertaken, and whereby under ordinary circumstances, the taxes would be increased, was balanced by the chance of losses, whereby taxation would be diminished. It never was designed tHItt the tax should be lessened by any disaster, any more than that it should be increased by any amount of prosperity. I do not think the consolidation act was designed to infringe upon this principle. When it declares the rate of taxation shall continue the same, it appears to me evident that all the stock and loans formerly taxable were to continue taxable without diminution by losses or unproductiveness. Otherwise the company might continue to own the same identical property, and if found not profitable, might by leaving it idle, exempt it entirely, when if in private hands it would be taxable upon a valuation. And if exempted for losses there would be great inequality unless they should be made liable to increased taxation in proportion to their profits. I think the true meaning therefore of the whole section, which refers to capital and loans actually employed in Michigan, must be deduced from the design of the new law to apply the old principle as far as possible to the new state of things. The original company was a Michigan company, and all of its capital was in the eye of the law employed in this State. Whatever money it may have expended in feeders by land or by water must have been regarded as merely ancillary to its home business, and expended upon it. Had any losses then taken place no one can suppose they could have formed any basis for a deduction from the taxes on stock and loans.
The object of the consolidation act was to enable this company to form a union with another company in Indiana; and by the terms of the act the new corporation was to be governed substantially by the old charter. That other company being formed under the laws of another State, held its own property exempt from our laws. There was no reason why that should not remain exempted, while there was no reason on the other hand for exempting- what was already subject to our jurisdiction. Looking at the whole subject, I think the term “actually employed” has no reference to the actual use of the property purchased by the company, but is merely designed to distinguish the Michigan investment from the Indiana investment. Because the capital of a company or an individual has been used to purchase a steamboat, it can not in any just sense be regarded as employed in every part of the world where the vessel may navigate, nor as unemployed when she is in ballast, or losing money, or laid up. The capital of an individual is regarded as employed or invested at the place where the owner does business. The capital of a New York or Boston merchant is employed in New York or Boston, no matter where his ships may be. This is the view taken by the Supreme Court of the United States in Hayes v. The Pacific Mail Steamship Company, 17 How. 596, where New York vessels employed in the California trade were held exempt from taxation in California. Whether allowing vessels or other property to remain in a place for a length of time may or may not confer a right to tax them there, is not decisive of the other question. The capital remains invested where the owner transacts his business, and is not transitory. The bill shows the steamboats were a part of the original Michigan investment. They remain in specie the property of the company, except one which was destroyed. I do not perceive how the original investment has been altered, And therefore, I think no deduction should be made from the tax on their account.
The next item on which a deduction is claimed consists of §250,000 of Jackson Branch bonds, which were lent by complainants and misappropriated. This item was considered by the, court in the ease in 4 Mich. 398. It was there held that, inasmuch as these bonds were there stated to have been exchanged for other bonds of another company, it must be presumed that the latter were regarded as an equivalent. The case as now presented is different, and no such presumption can arise. It now appears that there was no exchange of securities. whatever, but that the complainants, when they were unable to recover their own bonds, accepted the collaterals in payment. When collected or sold, or otherwise disposed of for value, I think the proceeds of these may fairly be considered as a loan to the complainants. But so long as they remain on hand uncollected and unconvertable, they can not fairly be considered as money or its equivalent. No loan has been made to the complainants on the credit of these Jackson Branch bonds, until some benefit has accrued from them.
The next item embraces §185,459,84, which sum represents the discount on bonds sold. It was held in the case before referred to, 4 Mich. 398, that the loans to the company must be taken to stand at the face of the bonds. This, I think, is a fair presumption, but not a conclusive one. The law permits complainants to sell their bonds at a discount, and therefore contemplates that they may have to repay more than they borrow. The tax is to be laid “upon all loans made to said company.” Sec. 31 of Charter, Laws 1846, p. 191. Nothing is lent which does not pass from the lender; and if in return for his ninety dollars he is to receive ninety - five or a hundred, he still lends but ninety. It appeal's that no bonds were sold at a premium, and that the amount' of loans was less than the face of the bonds by the amount above mentioned. I think no tax can be properly laid on this sum, because it was never borrowed.
The remaining item of §300,000, is claimed to be exempt from taxation because it is alleged to consist of 3000 shares of stock distributed among the stockholders in 1849, without any consideration pai’d, and without any subscription or promise to pay for it. It is also alleged that no portion of the means of the company was ever obtained from such stock. This is the same ground upon which payment of the tax was resisted in the case before referred to for the year 1855.
The term used in the section under which the tax was originally laid is “capital stock paid in.” Upon the case made by the bill the company deliberately issued stock as paid, and has always so treated it. It has, as fully appears, changed hands so as to become entirely confused. The holders of it have received dividends upon it, as full paid stock. It so stands for all ordinary purposes. I see no hardship in holding complainants responsible for taxation on what they hold out to the world as cash capital. And in this respect, I think the former decision was right. The company had debarred itself upon this theory from calling any more assessments. And the ordinary understanding of stock paid in, is stock on which no further calls can be made. It is n matter of daily occurrence to pay for labor and other expenditures in what is termed “ full paid stock,” at rates very different from what would be required in cash. The company obtains the same credit for one kind as for another when it seeks public confidence on the ground of its paid up capital. If instead of taxing the company, the several stockholders should be taxed on stock, one •share would avail no more than another.
But when we examine the evidence, the case made out by the bill is not only not established but entirely disproved. And as a complainant must rely upon the case set up in his own bill, he is entitled to no relief, even if the rule of law laid down in deciding the ' former case were to be disregarded.
It appears by the sworn report of the complainants upon which this tax is chiefly based (p. 18 of case) that the total amount of capital stock subscribed in the entire con solidation is $9,413,800, and that the amount actually paid in is $9,408,802 32. As no more than its face is likely to he paid in, this would leave a deficiency of only $4,997,68, to be applied to the entire stock. It is true the same report contains at its close an averment of the amount of the capital stock of the Michigan Southern Railroad at the time of the consolidation, showing then the deficiency of $300,-000 on account of nominal stock, stating, “ no part of which however was ever paid in” This statement, if true, is consistent with a payment subsequent to the consolidation. Mr. Bliss, however; by his testimony, shows that this report, which he also verified, is incorrect.
Being asked by the second and fifth interrogatories concerning the existence of unpaid stock, he shows a deficiency of about $160,000, which he thinks was for that amount unpaid on 8000 shares of stock. The evidence of the amount refers under the second answer to the time of the consolidation. The fifth answer appears to show that, so far as he knows, it was never paid. This makes a discrepancy in the report of $140,000, if we entirely disregard the small deficit appearing in the sum total of consolidated stock, which, however, from its minute accuracy has evidently been taken from accounts and not from estimates.
The testimony of Mr. Bliss, however, and the exhibits A and B, which he proves from the company’s records, show very clearly the character of the stock distribution of 1849, and show conclusively that there was never any distribution of 3000 shares of fictitious stock, nor any other amount of that kind. It appears from those resolutions, that the stock which had been divided into 5000 shares was recalled, and a new division of 8000 shares made in lieu of it, all to stand on the same footing — all credited equally with what had been paid in, and all equally chargeable with future calls. The amount paid in on each share was $45, making an aggregate of $360,000. There is no reason to suppose that any portion of this sum was fictitious. By the charter, complainants were required to pay previous to this time $175,000 of principal, and, besides this, interest, which at six per cent, computed as the various instalments became due, would amount to $60,000 more, making an aggregate of $285,000 on this account alone. The charter required an immediate expenditure of $20,000 for [rolling stock (Sec. 2, L. 1846, p. 171). The company was also required to proceed at once with various lines to be constructed or finished within given periods. Whether this work was done or not, it is hardly presumable that the remaining sum of $105,000 would exceed the expenditures on construction account for the first three years, over and above any earnings so applied. But be this as it may, no portion of the testimony in any way goes to discredit the fairness of the basis of the resolutions.
It was claimed by complainants’ counsel on the argument, that the testimony of Elisha C. Litchfield shows the fictitious character of the 8000 shares, That testimony is not very intelligible, and is evidently an attempt to explain the issue upon a mistaken theory. But if its facts be taken as accurate, its deductions are clearly erroneous, and would show merely a deficiency of $88,470 unpaid, instead of making that sum represent the entire payment. The resolutions of August, 1849, made the whole 8000 shares liable to further assessments to the amount of $55 per share, or $440,000, supposed to represent the debts and liabilities of the company. These debts Mr. Litchfield puts down as consisting of $325,000 unpaid principal of the purchase money due the State, and $76,580 debts for prior loans. By deducting these from $440,000, he deduces the balance of $88,470. He treats this sum of $440,000 as if it had been credited to the stock, when it was on the contrary charged on it, and, unless it exceeded the debts, it made the stock liable to its entire face. The interest on the $325,000 of State indebtedness at six per cent., if principal and interest should be paid promptly, would amount to $68,250, which not only extinguishes the balance of $38,4'70, but would leave an excess of about $30,000 after the face of the stock should have been paid in.
When all the evidence is collated, it is impossible to say that any particular deficiency, or any deficiency, is made out. The issue of any fictitious stock is clearly disproved. And all the stock being put on the same basis, it is not presumable that assessments have been since made on any but the just and equal principles which are required by law to be observed. The case does not assume any thing of this kind. Neither is it averred or shown that any assessments called on this stock remain unpaid. The payment of dividends on it would be inconsistent with such a theory. The books of the company must show the precise state of the stock account in regard to the whole issue. The evidence is in the control of the complainants. Until the original sources of evidence are resorted to, all outside testimony must be vague and unsatisfactory, as this record very fully exemplifies. If complainants have not received what should have been received on any of this stock, no one else has the means of ascertaining it, and I do not think their proofs at all satisfactory.
I am of opinion that a deduction should be made from the amount to be taxed of $250,000, for the lent bonds, and $185,459,84, for discounts on loans, and that no further deduction should be allowed on the case' presented. | [
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] |
Martin Ch. J.:
The relator in his petition for the' writ of mandamus, clearly made a case entitling him to it. Has this been overthrown by the cause shown against it by the respondents? We think not. No question is made by them of the regularity of the proceedings to condemn the land, and no issue is made upon any material point. They neither deny that the land of the relator was condemned, nor do they insist upon any fraud or irregularity in the proceedings taken to condemn it. They do not deny but that the damages, to compel the payment of which this writ is prayed, were awarded, nor but that the award and finding of the jury were returned into the Town Clerk’s office, and the amount of such award collected by tax, and deposited in the township Treasury, awaiting their order to be paid over to the relator. Upon all these points they are either silent or their answer is evasive. But they insist, 1st. upon the technical ground, that the award of the jury was not certified by the Justice before its return into the Town Clerk’s office, and 2d, that a road on the same land had been laid out in the year 1857, as cause why they should not “pay the award.”
As to the first ground, although it was the duty of the magistrate to certify the award, yet so long as it appears that such award was made and filed in the proper office, recognized and acted upon by the proper township officers, the land occupied for the purposes of a road, and a tax levied and collected for the payment of the damages awarded, I can not well see upon§ wbat equitable or legal grounds, tbe -town can bait here, and refuse to take tbe further and last step — tbe payment of .such sum — because such certificate is wanting. It appears to me that tbe respondents are estopped, from denying tbe validity of tbe award, or of tbe sufficiency of tbe return, after such action. Had tbe town refused to occupy tbe land, tbe case might be different, but having taken possession of it under tbe condemnation of tbe jury, and provided a fund for payment for it, tbe board should be required to issue tbe order for-such payment. But however this may be — and my brethren •who concur with me in other respects, do' not wish to be understood as expressing any opinion upon this point — we are agreed that the answer of tbe respondents is immaterial and irrelevant, and furnishes no sufficient cause why tbe writ should not be issued. Tbe duty of tbe jury is one prescribed by tbe Constitution, and when it has been duly executed, tbe rights of tbe relator, and of tbe township, are perfected, and their duties and liabilities established. Tbe certificate, of tbe Justice has not tbe character of an adjudiicaton — it determines no right, nor does it confer any power. It is simply an authentication of tbe return of tbe jury; a ministerial act, the omission of which can not invalidate tbe verdict of tbe jury, nor impair tbe rights of tbe relator. Suppose tbe death of tbe magistrate should occur after tbe return of tbe award to him, and before be could certify and file it in tbe Town Clerk’s office — wbat would be tbe rights and liabilities of parties ? Could it be claimed that by such accident tbe whole proceeding would be rendered void? I can not think so. In Overall v. Pero, 7 Mich. 315, we held that tbe entry of a verdict of a jury, by a Justice of tbe Peace, was sufficient to authorize the issue of an execution, notwithstanding the want of a final judgment entry. This was so held upon the ground that such entry, although in a judicial proceeding, was required as a ministerial and not as a judicial act, and its neglect would not deprive tbe party entitled to the execution, of his rights, which had been fully adjudicated by the jury. The same principle was again asserted in Hickey v. Hinsdale, 8 Mich. 267; and if in such cases the statute can he held to he directory, I can see no valid reason why the one under consideration should not he also, and for the much stronger reason that the magistrate in this case acts ministerially from first to last, and is without any judicial power or discretion. If such he the case, no right determined by the action of the jury can he impaired by this default of the magistrate.
The allegation that a road had been laid out over the same land in 1857, is no answer, as no law existed in that year under which it could have legally been done through condemnation of the land to he taken: and it was this fact, probably, which led to the subsequent laying out and establishing the present road.
Mandamus awarded.
Manning and Campbell JJ. concurred,
Christiancy J. concurred in the result. | [
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Manning J.:
The bill is for a new trial on the ground of newly discovered evidence since the rendition of the judgment at law, and for fraudulently obtaining the judgment by false testimony. The latter is not sustained by proof, and the newly discovered evidence is Parkhurst’s letter of the 13th September, 1855. This letter shows Parkhurst was mistaken, when he stated on the trial that he did not know the money was placed to his credit until the 6th of October. In giving his evidence, he said he supposed it was placed to the credit of Mr. Hadley, on Morris’s books, and knew nothing to the contrary, until he returned from Connecticut, on the 6th October. The letter shows he must have known it as early as the 13th September preceding. But the discrepancy between his letter and the evidence is immaterial, except that it shows he was mistaken as to time. It does not disprove the only material fact in issue on the trial, namely, that Parkhurst, as Had r ley’s agent, lent the money to Morris; that he took no evidence of the debt at the time, and supposed Hadley was credited with it on Morris’s books. In another particular, however, the letter would seem to. contradict his evidence. He stated on the trial that he had not drawn any of the money, or on account of it. In his letter, which is dated at Pontiac, he says: “ Mr. Hadley was here to-day, and wanted three hundred dollars, and I got it for him of Mr. Weeks, and I hope you will send out the amount this morning by Mr. Norris. You will see by looking on the books, that Mr. Morris got of Yan Sicklin & Co. one thousand dollars, and it was credited to me.” From this, it would seem he not only knew the $1000 had been credited to him, but that he intended to draw against it; otherwise why did he make mention of the $1000, got by Morris of Van Sicklin & Co.? If Morris’s defense had been, that he •had had the money of Hadley through Parkhurst, and that he had afterwards repaid the whole or a part of it to Hadley through the same channel, the letter in question would be material, with evidence showing the $300 had been sent by Norris, to show Parkhurst had drawn that amount for Hadley. But there is ho evidence the $300 were sent by Norris to Parkhurst, except Morris’s books, which are not evidence of it against Hadley. This, however, is not the only or most fatal objection to granting a new trial on the ground the newly discovered evidence shows the judgment is for too large a sum.
The theory of Morris’s defense on the trial was, that he had not had any money of Hadley; that the money he had of Parkhurst was Parkhurst’s money, and not Hadley’s. This is wholly inconsistent and repugnant to payments to Hadley through Parkhurst.' A man can not pay what he never owed. And in applying for a new-trial, a defendant who has not been fraudulently misled by his adversary in making his defense (of which there is no pretence in the present case) will not be permitted to change that defense. In other words, having set up one defense and failed in it, a new trial will not be awarded to enable him to make a «wholly different defense, and one which might have been, but was not, made on the trial.
On the issue made on the trial, the letter of the 13th September makes more for Hadley than against him. It by no means shows the money was Parkhurst’s and not Hadley’s. The contrary, we think, is fairly to be inferred from its language. It speaks of Hadley as one known to Morris — known to him through business transactions probably, as Morris says he was not personally acquainted with him — and of the $300 Hadley wanted, as money belonging to him. And after stating Hadley had some flour at Pontiac, says, “which I,” (Parkhurst) “shall sell, and we can have the use of all his money, more or less, all the fall, and it won’t do to disappoint] him. He is a miller, and rich, and will do a large business this fall and winter, and if we are prompt with him, can use his money.” Who is meant by “we,” is obvious, as the evidence discloses the fact that Parkhurst for ’many years had been Morris’s clerk, and had that season, although not then his clerk, been purchasing wool for him at Pontiac, and had been entrusted with a large sum of money for that purpose by Morris.
Although the letter of September does not fully square with Parkburat’s evidence, we do not think, as newly discovered evidence or otherwise, it is of such a character as to call for the interposition of a court of equity. The decree of the court below is affirmed, with costs.
The other Justices concurred. | [
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] |
Martin Ch. J.:
The motion to docket and dismiss must prevail. Ordinarily the reasons shown by the plaintiff in error for the delay in filing the return to the writ, would excuse such delay, and he would he permitted to file his return. And such would have been the result in the present case had not our attention been called, by both parties, to the record offered to he filed. From inspecting this, we find no hill of exceptions, and no assignment of errors which we can consider. The general assignment is invalid, and will authorize no action by the court — assignments of error being by rule 12, required to be special — and tbe special assignment is not of errors in the record, but of errors committed at the trial. While, as a general rule, we will not look into a record upon the consideration of motions like the one now before us, yet when it clearly appears that the plaintiff has no case in court, from defectivo or insufficient records and proceedings, as in the present case, -we think we are not authorized to suffer any further proceedings which will only operate to delay and to create expense, when the party is fairly out of court by his ow& •default.
The other Justices concurred. | [
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North, C. J.
The 2 plaintiffs in this original proceeding in this Court seek mandamus to compel the Michigan public school employees’ retirement fund board, which consists of the individually named defendants, to construe PA 1945, No 136, as amended (CL 1948, § 38.201 et seq. [Stat Ann 1949 Cum Supp § 15.893(1) et seq.~\), in such a manner as will enable each of the plaintiffs to qualify for receipt of “service retirement allowance.” The retirement board had previously disallowed the petition of the respective plaintiffs for such retirement allowances.
At the outset, in the appended footnote, we quote the provisions of the public school employees’ retirement act which are most pertinent to the controverted issues in the instant case, and italicize the portions which seem most directly controlling.
There is no particular dispute as to the factual background of this case, which may be briefly outlined as follows: Bach of these plaintiffs has been a bus driver for the Van Burén township consolidated schools. Charles Bateham was such a bus driver from September, 1927, until June, 1947, at which time he relinquished his work because of a regulation of the Van Burén township school board which made a school bus driver ineligible to drive after he had attained the age of 70 years, Mr. Bate-ham having arrived at the age of 72 years.
Plaintiff Hulett also served as a school bus driver for approximately the same period as Mr. Bateham and his services as such were terminated for the same reason. However, from September, 1936, to June, 1943, Mr. Hulett had additional duties as at tendance officer. It seems to be agreed that tbe actual time during which each of these plaintiffs served for the respective periods, above noted, in driving the school busses was 4 hours per day for 5 days each week; and there were also some special occasions on which one or the other of these plaintiffs drove a bus incident to school activities, such as cultural, recreational and athletic trips. As a school bus driver each of these plaintiffs was subject to telephone call, and charged with the duty of keeping his bus clean and seeing to it that it was properly serviced. But it seems that such extra service was not reported to the school district for the purpose of making a record for service retirement allowance, “in accordance with instructions” by the proper school authorities. It is because of services rendered of the character above noted and for the periods above noted, that the respective plaintiffs assert a right to receive service retirement allowance. On or about September 29, 1948, they were notified that their applications therefor had been denied.
But the claims of these plaintiffs must be considered in the light of the following circumstances. Prior to plaintiffs’ applications for service retirement allowance, and in August, 1947, the Van Burén township school board passed a regulation, effective September 1, 1947, prohibiting the employment of bus drivers over the age of 70 years. And on or about December 14, 1945, evidently acting under its authority provided in section 1, subd (j), of the act (see footnote), the defendant board adopted rule 12 which reads as follows:
“Part-time school employees shall receive service credit in the proportion that the number of hours served per week bears to 40.”
There seems to be no dispute in the record that if the defendant board is correct in applying rule 12 to the claim of each of these plaintiffs on the theory that they were only “part-time” employees neither of them is entitled to service retirement allowance, and mandamus should be denied. But, on the other hand, if, as plaintiffs contend, instead of being “part-time” employees, they were “regular” employees, they are entitled to the relief prayed.
As submitted by the respective litigants the controlling issue may be stated as follows:
“Is a regularly employed, nonteaching, public school employee, whose hours of labor are less than 8 hours per day, a ‘part-time employee’ within the meaning of PA 1945, No 136?” See CL 1948, § 38.201 et seq. (Stat Ann 1949 Cum Supp § 15.893 [1] et seq.).
Plaintiffs herein assert that employees or “workers are either regular, daily workers, or part-time workers and that a part-time employee is someone like a substitute teacher, or substitute driver, that is, one who is an employee only part of the time, not all the time.” And they say: “Our point is that the daily bus driver who is a regular employee, working all of the time, month in and month out, is not a ‘part-time’ employee.”
Under the statutory provisions and the regulations adopted by it, the Michigan public school employees’ retirement fund board held that neither of these plaintiffs had served “for a period of 15 years” as required in chapter 1, § 15, of the act. This result was reached in consequence of the retirement fund board having evaluated the services of the respective plaintiff bus drivers as “part-time school employees” whose actual services extended over a period of 20 hours per week, and in consequence the board determined that the weekly service credit of each plaintiff should be for only i of a 40-hour week. The action of the board in the above respect was taken in con sequence of the provision in chapter 1, § 1, subd (j), of the act, which reads:
“That where an employee serves on a part-time basis, the retirement board shall have the right to evaluate such service and determine the credit therefor.”
Plaintiffs cite in support of their contention only 1 decision, Sherrod v. Lawrenceburg School City, 213 Ind 392 (12 NE2d 944), which they claim is directly in point. Plaintiff in the Sherrod Case was an art teacher who regularly taught only 12 days each month. In passing upon her claim under the Indiana teachers’ tenure act, the school authorities took the position that she was only a “part-time” employee. The court reached an opposite result, and in its opinion said:
“The law does not require that teachers shall teach every day, or every hour of every day. Such subjects as art or music may require fewer hours of teaching. This is in the discretion of the school authorities. But appellant was undoubtedly regularly employed, teaching the same subject a given number •of days per month, over a period of years, and must be considered a regular teacher (as distinguished from a part-time teacher)
However, the above noted decision is not particularly helpful, and certainly not controlling in the instant case, for the reason that the Indiana teachers’ tenure statute (6 Burns Ann Stat 1933 [1948 Replacement], § 28-4301 et seq.) contains no provision comparable to that in the Michigan statute, just above quoted, to-wit:
“That where an employee serves on a part-time basis, the retirement board shall have the right to evaluate such service and determine the credit therefor.”
While the ease involved a controversy which arose under the workmen’s compensation statute, rather than one providing for payments out of a teachers’ retirement fund, the supreme court of New Hampshire gave careful and detailed consideration as to the proper interpretation to be given to the words “full time” as used in the New Hampshire statute.
“The defendant argues that ‘full time’ during a period of depression may well be less than full time when business is good; that if in a given year a workman works all the time that his employer has work for him to do he works ‘full time’ for that year. * * *
‘We think that the words ‘full time’ in an industrial community like ours have acquired a definite significance which is generally recognized and well settled by popular usage. This term, like its close relatives part time and overtime has reference to a customary or normal period of work. All of these terms assume that a certain number of hours customarily constitute a day’s work and that work for a certain number of days constitutes a week’s work within a given industry or factory. One who works less than the usual number of hours per day is said to have a part-time job. One who works more than the usual number of hours per day is said to work overtime. When a factory runs only 3 days per week it is said to be running on part time and its employees say that they are only working part time. Full time ordinarily signifies the normal or customary period of labor per day or per week in the establishment where the workman is employed for the kind of work which he is hired to perform.” Cote v. Bachelder-Worcester Co., 85 NH 444 (160 A 101, 82 ALR 1239).
While its decision also pertains to the workmen’s compensation law, the supreme court of Kentucky in passing upon what constitutes “working at full time” said:
“One who works only part of a day, or only 2 or 3 days out of a week, or only a few weeks out of the year, cannot be said to be working at full time. We therefore conclude that the words, ‘at full time,’ necessarily mean a full working day for 6 days in every week of the year.” Beaver Dam Coal Co. v. Hocker, 202 Ky 398 (259 SW 1010).
While Lee v. Villard Consolidated School District No. 5, 192 Minn 449 (257 NW 90), was also a case which arose under a workmen’s compensation statute, decision necessitated passing upon whether plaintiff’s deceased husband, Glen Lee, -who “worked an average of 3 hours per day 5 days a week” driving his bus as a school bus, was a part-time employee of the school district. The court held that Lee was a part-time worker.
While for present purposes we do not attach to it too much importance, “part time” is defined in Webster’s New International Dictionary (2d ed) as follows: “Less than full time. Also, employment at less than the customary number of hours per week.”
As hereinbefore noted, the act in chapter 1, § 2, provides:
“The administration and management of the retirement system, responsibility for making effective the provisions of this chapter, and the authority to make all rules and regulations necessary therefor are hereby vested in the retirement board.” CL 1948, § 38.202 (Stat Ann 1949 Cum Supp § 15.893 [2]).
Rule 12, adopted by the defendant board, reads:
“Part-time school employees shall receive service credit in the proportion that the number of hours served per week bears to 40.”
And the statute contains the following:
“Provided further, That where an employee serves on a part-time basis, the .retirement board shall have the right to evaluate such service and determine the credit therefor: Provided, however, That not less than 150 days shall constitute a school year.” CL 1948, § 38.201 (Stat Ann 1949 Cum Supp § 15.893 [1]).
Further, acting under its statutory powers, the Van Burén township school board adopted the regulation, effective September 1, 1947, prohibiting the employment of bus drivers over the age of 70 years.
It must not be overlooked that the law imposes on the defendant board the duty of conserving the fund from which retirement allowances are paid, and to adopt proper rules and regulations to that end. The statute provides that any person who withdraws from the service without having qualified for a retirement allowance shall have a refund of payments made by such person. (CL 1948, § 38.222 [Stat Ann 1949 Cum Supp §15.893(22)].) Plaintiffs make no claim of bad faith on the part of defendants. Rather, plaintiffs contend that by its rules and regulations the defendant board has deprived plaintiffs of rights afforded them under’the earlier act (PA 1941, No 56), and in doing so the retirement board was guilty of a “wholly capricious act.” But, with that contention we do not agree. The powers and conduct of the defendant board are controlled by PA 1945, No 136, as amended.
.“The right to allow an administrative agency to adopt rules and regulations to effectuate the purposes of the legislation is well recognized. (Citing numerous cases.) * * #
“ ‘In Argo Oil Corporation v. Atwood, 274 Mich 47, it was said: “It is too well settled to need the citation of supporting authorities that the legislature, within limits defined in the law, may confer authority on an administrative officer or board to make rules as to details, to find facts, and to exercise some discretion, in the administration of a stat ute.” ’ ” Coffman v. State Board of Examiners in Optometry, 331 Mich 582, 589.
We conclude that the defendant board properly-classified and held plaintiffs to be part-time employees within the meaning of the pertinent portions of PA 1945, No 136, as amended. The record before us is not such as would justify the issuance of a writ of mandamus, because it does not appear there is a clear legal duty, as asserted by plaintiffs, on the part of the defendants and a clear legal right on the part of plaintiffs to the discharge of that duty. McLeod v. State Board of Canvassers, 304 Mich 120.
Plaintiffs’ petition for mandamus is denied; but since a question of public concern is presented, no costs will be awarded.
Dethmers, Butzel, Carr, Bushnell, Sharpe, Boyles, and Reid, JJ., concurred.
PA 1945, No 136 — Title in part:
“An act to provide for retirement systems for Michigan public school employees, as defined herein; to combine and continue the operations of * * * PA 1937, No 184, as amended, and * * * PA 1941, No 56.
“Chapter I.
“See. 1. * * *
“(a) ‘Retirement system’ shall mean the Michigan public school employees’ retirement system provided for in this chapter. * * *
“(f) ‘Public school employee’ shall consist of all employees of a board of education or school board of any public school district. (Specifying in particular certain employees.) * * *
“(g) ‘Annuity’ shall mean annual payments for life derived from the accumulated contributions of members. It shall be the actuarial equivalent of the total accumulated deposits of the retiring employee.
“(h) ‘Pension’ shall mean annual payments for life derived from money provided by the State.
“(i) ‘Retirement allowance’ shall mean the sum of the annuity and the pension.
“(j) ‘Service’ shall mean service performed as a public school employee. In computing terms of service, a year shall be a legal school year at the time and place where said service was performed: * * * Provided, however, That no more than 1 year’s service sliall be counted for retirement purposes in any fiscal year: Provided further, That where an employee serves on a part time basis, the retirement board shall have the right to evaluate such service and determine the credit therefor: Provided, however, That not less than 150 days shall constitute a school year.” (OL 1948, § 38.201 '[Stat Ann 1949 Cum Supp § 15.893(1)].)
“See. 2. * _* * The administration and management of the ■ retirement system, responsibility for making effective the provisions of this chapter, and .the authority to malee all rules and regulations necessary therefor are hereby vested in the retirement board.” (CL 1948, § 38.202 [Stat Ann 19^9 Cum Supp § 15.893(2)].)
“See. 7. * * * The retirement board shall make rules, and regulations not inconsistent with the provisions of this chapter, which shall provide for .* * * the payment of annuities, pensions, and allowances therefrom -(i.e., the retirement fund).” ,(GL 1948, § 38.207 [Stat Ann 1949 Cum Supp § 15.893(7)].)
“Sec. 15. * * * On and after July 1, Í945, any member -or person who has attained the age of 60 years, and who has served as a Michigan public school employee as defined under this chapter and/or chapter 1 of PA 1937, No 184, as amended, and/or chapter 1 of PA 1941, No 56, for a period of 15 years, shall upon retirement from service be entitled to a' retirement allowance. * * *
“Upon retirement from service as herein provided after attaining age 60, a member shall receive a service retirement allowance.” (CL 1948, § 38.215 [Stat Ann 1949 Cum.Supp § 15.893(15).].). | [
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Butzel, J.
In 1913 Edward J. Minock, now deceased, recorded a plat of Edward J. Minock’s subdivision of the west i of the southwest of section 14 in Bedford township, 1 S, B 10 E, Wayne county, Michigan (now in the city of Detroit). The subdivision was bounded on the north by Grand Biver avenue, on the south by 12th street (now Fenkell avenue), on the west by Evergreen road, and on the east by the property of others. It contains 62 lots, 11 of which have a frontage varying from 50 to 60 feet on Grand Biver avenue, and 51 lots of over an acre each are south of the Grand River lots and fronting on streets that traversed the subdivision.
Lot 53 and lot 54 adjoining it are situated at the southeast corner of Minock and Midland avenue (formerly Emmett avenue). Eighty-three feet or thereabouts were later taken off the east end of these 2 lots to become part of the Outer Drive, a very fine thoroughfare 150 feet in width running through the city of Detroit near its outside boundaries. As a result, lots 53 and 54 also front on Outer Drive. The lots still have a depth of approximately 200 feet and a width of 82 and 132 feet respectively. Some of the other lots in the subdivision were divided into smaller residential lots.
The plat itself contains no restrictions. In all the deeds to the lots given by the subdivider, with very few exceptions, the following restriction was incorporated:
“As a part of the consideration of this deed, it is agreed between the parties hereto that no residence shall be built nearer than 25 feet'from the * * * line of the above described lands and shall cost not less than $1,200 and that no barn, cess pool or out buildings of any kind or description shall be built or permitted to remain on said lands nearer than 90 feet from the * * * line of the said described lands,” the deeds making reference to the front line of each lot, as same appeared to be either the easterly or the westerly line of each of the lots conveyed.
In 1913 Amos and Denise Gramlich bought these 2 lots subject to this restriction and deeded the west half of lot 53 to plaintiffs Monticelli subject to restrictions of record. Defendants, First United Presbyterian Church and its agents, knew of the restriction in the Gramlich deeds when they purchased the easterly half of lot 53 and all of lot 54 which together we shall refer to as the proposed church site, but Mrs. Gramlich, survivor of herself and hus band, left out the restrictive covenant in deeding to the church. The Monticellis and other property owners brought suit to enjoin the church, its minister and other defendants herein from building a church on the proposed site. After a hearing, plaintiffs were awarded a decree restraining such construction, and defendants appeal.
The lots on Grand River avenue and Fenkell avenue are improved with stores and gas stations and are used for nonresidential purposes; otherwise, the other lots have been used exclusively for residential purposes. Very substantial single residences have been built on them with the exception that in the block between Grand River avenue and Midland avenue (and not in the block where the proposed church site is situated), 1 large and 1 small apartment building have been erected. Plaintiffs Monticelli have a substantial residence which cost them over $13,000. Plaintiffs Smith own a home on lot 55 adjoining the south side of the proposed church site. There has not been such a change in the neighborhood as to destroy the restriction for residential purposes, assuming that such exists as plaintiffs claim, on all the lots on the side streets. "We further find that a residential restriction would still be of benefit to plaintiffs, who may bring suit to enforce it. See Stewart v. Stark, 181 Mich 408; Swan v. Mitshkun, 207 Mich 70; Putnam v. Ernst, 232 Mich 682; Sullivan v. Playfair Realty Co., 238 Mich 274; Voorheis v. Powell, 261 Mich 378 (85 ALR 932); Indian Village Association v. Barton, 312 Mich 541,
To simplify the issues in this suit, we hold that a church is not a nuisance per se. Plaintiffs disavow any such claim. They do assert that the church would destroy the residential character of their homes, attract large crowds, create parking problems, noises and interfere with their privacy, et cetera. The trial court properly took testimony to determine whether the enforcement of the restriction would be of value to plaintiffs.
The church is to be built in 3 units. The walls of one of them would be built along 2 sides of the Monticellis’ property and also along 1 side of the Smith property.
The building of a church would violate a covenant either express or by reason of a reciprocal negative easement forbidding any building except for residential purposes, assuming such to exist here. In Voorheis v. Powell, supra, we quoted from Evangelical Lutheran Church of the Ascension v. Sahlem, 254 NY 161 (172 NE 455), as follows:
“Here, in the case at hand, no process of balancing the equities can make the plaintiff’s the greater when compared with the defendant’s, or even place the 2 in equipoise. The defendant, the owner, has done nothing but insist upon adherence to a covenant which is now as valid and binding as at the hour of its making. His neighbors are willing to modify the restriction and forego a portion of their rights. He refuses to go with them. Rightly or wrongly he believes that the comfort of his dwelling will be imperiled by the change, and so he chooses to abide by the covenant as framed. The choice is for him only. Neither at law nor in equity is it written that a. license has been granted to religious corporations, by reason of the high purpose of their being, to set covenants at naught. Indeed, if in such matters there can be degrees of obligation, one would suppose that a more sensitive adherence to the demands of plighted faith might be expected of them than would be looked for of the world at large. Other owners may consent. One owner, the defendant, satisfied with the existing state of things, refuses to disturb it. He will be protected in his refusal by all the power of the law.”
Also, see Boston-Edison Association v. Temple of Light, 310 Mich 48.
Daniel Minock and Edward Minock, Ms brother, both inherited property from their father. Daniel inherited the parcel adjoining Edward’s. It is now known as the Evergreen Subdivision. Daniel in subdividing his parcel in 1916 restricted the lots, except those on Grand River avenue, to single private dwellings. The plats for the 2 subdivisions came from the same law offices. In the opinion of the trial court, some stress was placed on this circumstance, and it was argued that both brothers must have intended the same restriction. • This does not follow. It is non sequitur.
In view of our decision we need not consider whether the building of the church in the manner proposed will violate the zoning laws or building regulations of the city of Detroit. Defendants state that they will be bound by them and will conform with them if they are permitted to build the church.
It has also been generally true that covenants not restricting properties to residence or dwellings may be regarded as permitting the use of the restricted property for church purposes. Roberts v. Congregation Shaareg Zedek, 242 Mich 381; Kelly v. Carpenter, 245 Mich 406; 13 ALR2d 1242. Defendants relied heavily upon the Roberts and Kelly Cases in their arguments. They ignored the fact, however, that the restrictions in those cases pertained to “buildings” and could not be interpreted to mean “residences,” particularly in view of the fact that no uniform residential area had developed. These cases, therefore, are in no way controlling here.
The restrictive covenant itself does not expressly forbid any particular kind of use of the property, only sets out requirements for the erection of residences should they be built. Does this affirmative requirement amount, in effect, to a negative requirement that none other than residences be built? As the restriction is poorly worded, it is open to con struction to ascertain the intent of the subdivider; in this case, more particularly, whether or not he had a general plan of restriction for the subdivision which involved its restriction to single residential use only. To the effect that ambiguous restrictions may be interpreted in the light of a general plan, see Library Neighborhood Association v. Goosen, 229 Mich 89; Signaigo v. Begun, 234 Mich 246; Bunce v. Jones, 238 Mich 337; Holderness v. Central States Finance Corp., 241 Mich 604; Brown v. Hojnacki, 270 Mich 557 (97 ALR 621); West Bloomfield Co. v. Haddock, 326 Mich 601; Ardmore Association v. Bankle, 329 Mich 573.
It will serve no useful purpose to review all of the many building restriction cases which have come before this Court. No two are alike and, in the main, must stand on their own facts. No hard and fast rules appear for our guidance. Putnam v. Ernst, supra; Hamburger v. Kramp, 268 Mich 611.
Counsel have discussed a number of cases in which we had to determine the nature of a general building plan, but in which there was no question as to the import of the restriction involved, only the problem as to whether the general plan of restriction was binding on property not burdened with restrictions of record by reason of a reciprocal negative easement. Of such nature are: Allen v. City of Detroit, 167 Mich 464 (36 LRA NS 890); McQuade v. Wilcox, 215 Mich 302 (16 ALR 997); French v. White Star Refining Co., 229 Mich 474; Sanborn v. McLean, 233 Mich 227 (60 ALR 1212); Morris v. Levin, 236 Mich 490; Sullivan v. Playfair Realty Co., supra; Kiskadden v. Berman, 244 Mich 473; Indian Village Association v. Barton, supra; Zelinski v. Becker, 318 Mich 209. Those cases pose an entirely different problem than the instant one. Defendants herein admit they are bound by restrictions of record and our problem is whether or not such restric tions, as above set forth, are to be interpreted in the light of a general plan as restricting the Edward J. Minock Subdivision to residence purposes only except on business streets.
The covenant in question is affirmative and not negative. We find no case involving an identical covenant. Very similar, however, was the covenant in Library Neighborhood Association v. Goosen, supra, to the effect that, “it is a condition of this conveyance that the second party * * * shall erect a * * * good * * * single dwelling.” In express terms, there was no negative promise, only an affirmative requirement. This Court there held that it was proper to consider the circumstances surrounding the covenant in order to determine the intent of the grantor. All the other lots in the subdivision were subject to the same restriction. A single residence building plan was adopted, understood and acted upon by all parties in interest, with the result that the neighborhood consisted at the time of trial of high-class single residence property. The restriction was maintained throughout a long period by such parties. We held that an attempt to build other than a single residence could properly be enjoined. It is unnecessary to point out the many analogies between the Library Neighborhood Case and the instant one. We believe it is very persuasive here:
For other cases in which restrictive covenants have been interpreted in the light of a plan generally observed, in a manner so as to make them more restrictive, see Signaigo v. Begun, supra; Bunce v. Jones, supra; Holderness v. Central States Finance Corp., supra; Brown v. Hojnacki, supra. In each of these cases the result was to uphold a strictly residential character of a neighborhood, subdivision or plat.
We have also examined another group of cases in which a general plan was held not to exist. Kime v. Dunitz, 249 Mich 588; In re Nordwood Estates Subdivision, 291 Mich 563; Denhardt v. De Roo, 295 Mich 223; and Kathan v. Stevenson, 307 Mich 485, all involve situations where it was sought to prove an implied restriction but we did not allow such proof as there was no showing that a general plan, if such existed, had been uniformly complied with. And in Casterton v. Plotkin, 188 Mich 333, we denied relief as the defendant had taken title to his property prior to the inception of the general plan. In none of these cases was there a fact situation similar to that in the instant case.
We believe that adequate showing has been made here of the existence of a general plan to restrict the Edward J. Minock Subdivision to single residence purposes and that under the law of Michigan such plan will be enforced by this Court. It is true that it is difficult to ascertain with exactitude the intent of the subdivider, Edward J. Minock, in 1913, when he sold to Mr. and Mrs. Gramlich. There is no showing of his intent through any representations he might have made. The trial court properly noted, however, that the size of the lots set out indicates he did not intend the property for business purposes, the usual frontage for business lots in Detroit having been 20 feet. We can also infer that the sub-divider did not contemplate that a building other than a residence would be erected, as there is no mention of the word “building” or “business” in his restrictions. This of itself does not absolutely indicate an intent to so restrict the property.
The classic statement so frequently quoted of the development of a general plan is found in Allen v. City of Detroit, supra, p 469:
“If the general plan has been maintained from its inception, if it has been understood, accepted, relied on, and acted upon by all in interest, it is binding and enforceable on all inter se. It goes with the land, and is equally binding on all purchasers with notice.”
See Ardmore Association v. Bankle, supra. Those requirements are met in the instant situation. The fact that single residences only exist in the disputed area is one of the best indications that the subdivider intended to so restrict it. Although divided into smaller lots, the property was maintained as residential. The testimony is undisputed that the purchasers of lots in the area built single residences in conformance with what they believed to be a general plan and scheme. The residential plan was maintained from the time of its inception, when the subdivision was platted until Mrs. Grramlich, as survivor of herself and husband, deeded to the church. She was vigilant in maintaining the single-residential character of the property and thus acquiesced in the general plan to so maintain the subdivision and waived any right she or her grantees would have to act outside of it.
It is undisputed that defendants were given notice by plaintiffs that the properties were restricted to single residential purposes. In Library Neighborhood Association v. Goosen, supra, we held (quoting-syllabus) :
“In a suit to restrain defendant from erecting- an apartment house on lots in a district claimed by plaintiff to be restricted to single residences, where defendant had actual notice of said claimed restrictions he could not rely on the fact that the recorded plat contained no such restrictions, and that the language of his deed was insufficient to give him notice of such restrictions.”
In Signaigo v. Begun, supra, we said at page 250:
“The oral testimony fortified by numerous photographs presents a situation that could scarcely be overlooked by a most casual observer, and in addition to this there is positive testimony that defendant was informed before he purchased the lot that the street was restricted to 'single residences only’ * * * defendant [was] given actual notice.”
The same elements of notice are present in the instant case as were present in the above 2 cases.
It was shown at the hearing that the residential character of the neighborhood would be less pronounced if defendants were allowed to build. Although the law does not favor restraints on the alienation of property in general, restrictions for residence purposes, if clearly established, are favored by definite public policy. Johnstone v. Detroit, G. H. & M. R. Co., 245 Mich 65 (67 ALR 373) ; Wood v. Blancke, 304 Mich 283. We are mindful of the highly favored place a church should have in the community. As an owner of real estate, however, the church stands equally before the law with all others who invoke its protection. Plaintiffs herein are entitled to the protection of the residential restriction for which they bargained when they built their homes. We, therefore, find no equities which dictate that the restriction should not be enforced in this instance.
The decree in favor of plaintiffs is affirmed, with costs.
North, C. J., and Dethmers, Carr, Bushnell, Sharpe, and Reid, JJ., concurred with Butzel, J.
Boyles, J., concurred in the result. | [
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Carr, J.
The facts in this case are not in dispute. On. September 12, 1945, Claude Coolman, then the husband of the plaintiff, suffered an accidental fatal injury arising out of and in the course of his employment by defendant Contract Purchase Corporation. His sole dependent was the widow who was awarded compensation at the rate of $19 per week, for 400 weeks, for total dependency in accordance with pertinent provisions of the workmen’s compensation law in force at that time as amended by PA 1943, No 245 (CL 1948, § 412.5 [Stat Ann 1947 Cum Supp §17.155]).
In November, 1947, plaintiff petitioned the workmen’s compensation commission for an order authorizing a “lump-sum advance payment” to enable her to purchase certain equipment for the operation of her home and farm and to cover specified items of personal expense. Defendants opposed the application but an order was entered on January 13, 1948, awarding plaintiff an advance payment of compensation for a period of 129 weeks in the aggregate amount of $2,035.47, the order being based on the provisions of part 2, § 22, of the workmen’s compensation law (CL 1948, § 412.22 [Stat Ann 1950 Rev § 17.172]). Said amount was paid to plaintiff and the weekly payments were continued until the 5th of March, 1950, when plaintiff remarried. Under section 6 (c) of part 2 of the law (CL 1948, § 412.6 [Stat Ann 1950 Rev § 17.156]) such remarriage terminated plaintiff’s right to receive compensation payments. Notice of termination was given and defendants filed a petition with the compensation commission for a hearing to review the payments made and to determine the rights of .the parties. A hearing was had before a deputy commissioner of the department of labor and industry who found specifically that plaintiff had remarried and was not entitled to receive compensation benefits after March 5, 1950. He also determined, in accordance with the claims of the defendants, that the said sum of $2,-035.47 paid to plaintiff in 1948, pursuant to the order of the commission of January 13, 1948, was an overpayment. On appeal the compensation commission sustained the finding of the deputy and directed plaintiff to refund to defendants the amount of such overpayment. On leave granted, plaintiff has appealed to this Court.
On behalf of appellant it is urged that defendants’ petition for review of payments and determination of rights was insufficient to authorize the deputy commissioner and the compensation commission to pass on the question involved, that is, whether the advancement to plaintiff in 1948 constituted an overpayment to the return of which defendants are entitled. It does not appear, however, that any objection was made on such ground until after the deputy had rendered his decision. While defendants did not specifically allege in their petition that they sought a determination on the issue of overpayment, we do not think that plaintiff or her counsel were misled thereby. The record indicates that the purpose of the hearing sought was clearly understood by the' parties concerned as well as by the deputy and the commission.
It is also contended that the order of the commission granting to plaintiff the advance payment of compensation for a period of 129 weeks was res judicata, and that the commission was without authority to order a repayment, no question of actual fraud or bad faith being involved. In reaching its conclusion, as above indicated, the compensation commission said in part:-
“It is obvious that under our act where dependency compensation benefits to a widow terminate upon her remarriage that any payments covering a period beyond the date of her remarriage are overpayments. In the instant case the widow was paid not only to March 5, 1950, the date of her remarriage, but for an additional 129 weeks. She was not entitled to the payment for the 129 weeks because section 6 of part 2 specifically provides that dependency payments stop when the widow remarries. Defendants’ liability for dependency compensation terminated on March 5, 1950.”
Attention was directed to the decision of this Court in Samels v. Goodyear Tire & Rubber Company, 323 Mich 251, as supporting the commission’s authority to direct the refunding to defendants of the amount of the overpayment. In that case, in order to comply with the rules of the compensation commission relating to the hearing of petitions for reduction of compensation, defendants claimed that they had paid more compensation than was due to the claimant under the provisions of the workmen’s compensation law. In sustaining the power of the commission to make proper adjustments with reference to such overpayments, it was said:
“Nevertheless, where there has been no laches by the employer, the commission, when called upon by proper petition, should determine whether there has been an overpayment under the facts, as are presented in this case, and order the return of such overpayment either directly or by a credit on future payments. The act seeks just compensation, but not a penalty. If timely sought, retroactive awards have frequently been made, and while as a rule in favor of the employee, also at times in favor of the employer. Romanchuk v. Ford Motor Co., 290 Mich 673, 677; Grycan v. Ford Motor Co., 291 Mich 241; Szczucki v. Cadillac Motor Co., 294 Mich 271, in all of which cases the rule set forth in Kirchner v. Michigan Sugar Co., 206 Mich 459, hereinbefore quoted, has been referred to with approval. Credit should be given to defendants for the overpayments, if any, they were obligated to make under Rule 8(a), supra, in order to present their present claims. * * *
“Plaintiff should be ordered to repay to defendant employer the amount of overpayment, or in default thereof, it shall be deducted from the compensation hereafter accruing until it is paid.”
In Kirchner v. Michigan Sugar Co., 206 Mich 459, the defendant and its insurer entered into an agreement with the plaintiff for the payment of compensation in an amount greater than plaintiff was entitled to receive. It was contended that such agreement resulted from a mistake on the part of defendant. Relief was sought by petition under the workmen’s compensation law. The industrial accident board (now the workmen’s compensation commission) determined the facts to be as claimed by the defendant and directed that the amount of overpayments should be applied in reduction of future payments which it was found plaintiff was entitled to receive. It was contended on behalf of plaintiff that the agreement of the parties was conclusive and that the industrial accident board was without power to make the order in question.. In rejecting such contention, it was said:
“The purpose of the compensation law is compensation at rates which the law itself, directly or indirectly, but certainly, fixes. Claimant is entitled to receive, and his employer is obligated to pay, no more and no less than the statute compensation. "We are not called upon to decide whether an agreed but a too large or a too small compensation having-been paid by agreement and the period of payment having- ended and all payments having- been made, by commutation or otherwise, either party may have recourse against the other by action of the industrial accident board or otherwise. But so long as the matter is depending before the board we are of the opinion that in the due administration of the law it has power to so limit payments, by its orders, that the statute sum, no more, no less, shall be paid and received, and to make such an order as was made in this proceeding to bring- about, so far as possible, such desired and lawful result. The order reviewed in terms and in fact takes nothing from plaintiff in certiorari to which, under the law, he is entitled. It may leave him possessed of a larger sum than the one to which he was entitled. If its effect shall be to give him no less than the compensation which the law has said he shall have, his rights, under the law, have been duly respected.”
In Webster v. Rotary Electric Steel Company, 321 Mich 526, an employee of the defendant received fatal injuries arising- out of and in the course of his employment. He left 2 dependents, a widow and an infant daughter. Payment of compensation at the rate of $21 per week in accordance with the provisions of the statute was duly ordered and made. Some months later the widow remarried, thus terminating her right to further compensation, and the question arose as to the weekly amount payable to the child. The commission by order fixed such compensation at $21 per week. This Court determined that the award was erroneous and remanded the case with directions to enter an order at the rate of $19 per week, with a further requirement that any amount in excess of that sum paid to the minor plaintiff following- the remarriage of the mother should be deducted from future payments.
Appellant cites and relies on Meyers v. Iron County, 297 Mich 629. It was there held that a-lump-sum settlement for partial permanent disability made by agreement of the parties and duly approved by the department of labor and industry precluded plaintiff from presenting a petition for further compensation based on an alleged increase in disability and a consequent decrease in earning capacity. The department of labor and industry denied the relief sought and on review by this Court such order was affirmed. Under the facts and issues there involved we do not think that the decision has any bearing in the instant controversy. Of like import is Marks v. Otis Elevator Co., 276 Mich 75.
The order of the commission of January 13, 1948, granting to plaintiff a lump-sum advance payment of compensation for 129 weeks, determined as provided in the statute, is not in question. The commission was invested by the statute with discretionary authority, on a proper showing of facts, to direct such advance payment. McMullen v. Gavette Construction Co., 207 Mich 586; Rench v. Kalamazoo Stove & Furnace Co., 290 Mich 476; Grycan v. Ford Motor Co., 291 Mich 241. The petition filed by defendants on which the order in question heré was based did not seek a rehearing but rather a determination and adjustment of the rights of the parties in view of the altered situation resulting from the plaintiff’s remarriage. The order for the advance payment, not having been appealed, was final insofar as the duty to make, and the right to receive, the advance payment was concerned, but it did not preclude defendants from raising further questions resulting from changed conditions due to the voluntary act of the plaintiff. On the issue of res judicata in a proceeding of this nature, see Webber v. Steiger Lumber Company, 322 Mich 675.
The practical situation presented here is that the compensation commission, exercising its discretionary authority, permitted plaintiff to receive a certain portion of her compensation in advance of the dates of payment that otherwise would have obtained. It is apparent that such action was taken on the assumption that in due course of time plaintiff would become entitled to, and would receive, weekly payments in accordance with the original action taken under the statute. Such assumption was a wholly logical one on which the commission was entitled to rely. By her remarriage plaintiff terminated all right to receive further compensation arising from her status as a dependent of her former husband. If the anticipatory order had not been made she would not, of course, have been entitled, following her remarriage, to the 129, weeks compensation covered by such order. The records of the commission, which have been duly certified to this Court, indicate that plaintiff received compensation at the rate of $19 per week for a total period of 233 weeks, aggregating $4,427, and that a burial allowance in the sum of $300 was also paid. Her right to further compensation under the statute was terminated by her. Under the facts presented here we are in accord with the holding of the compensation commission that under the statute, reasonably interpreted, the amount paid to her in anticipation of future payments that it was assumed she would be entitled to receive must-be regarded as an overpayment. In ordering the return the commission did not exceed its authority.
The order of the compensation commission is affirmed, with costs to defendants.
North, C. J., and Dethmers, Butzel, Bushnell, Sharpe, Boyles, and Reid, JJ., concurred. | [
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Butzel, J.
Earl T. Maynard, herein referred to as plaintiff, asserting ownership in certain vending machines and their contents, filed a petition in the superior court for the city of Grand Rapids for the recovery of 3 machines:. 2 for vending cigarettes, and the other for vending candy, and their contents when seized. They had been placed by plaintiff’s agents and subsequently seized by the police in 2 separate establishments, the proprietors of which had violated the liquor laws. The latter were duly convicted and sentenced in the superior court for the city of Grand Bapids and the petitioner thereafter sought recovery of the property from the prosecuting attorney, herein called the defendant. The seizure in one establishment took place on or about November 7,1949, and the other on or about December 5,1949. The petition for the return of the property was not filed until February 15, 1950. In the opinion of the trial judge filed December 14, 1950, it was held that plaintiff was entitled to the return of the property. The order does not appear in the record. Defendant has appealed.
In the statement of questions involved set forth by defendant in his brief, no question is raised in regard to the jurisdiction of the court or the propriety of the proceedings. Defendant, however, contends that the court erred in directing the return of the property. Search warrants preceded the seizures. The complaint in each instance was for the illicit sale of liquor, in one case contrary to section 32 (CL 1948, § 436.32 [Stat Ann § 18:1003]), and the other case section 44 (CL 1948, § 436.44 [Stat Ann § 18.1015]), PA 1933 (Ex Sess), No 8. The search warrant was issued presumably under section 42 (CL 1948, § 436.42 [Stat Ann § 18.1013]) of the same act which provides for the seizure of all alcoholic liquors, containers, implements or conveyances by direct order of the court or magistrate, such to be turned .over to the commission, et cetera. The court held that the search warrant was issued under the provisions of section 42, supra, and that the vending machines did not constitute alcoholic liquors, containers, implements or conveyances, the only articles covered by the act. He held that a vending machine for the sale of legitimate merchandise was not an implement within the meaning of the act and, therefore, could not be legally seized and should be returned. Defendant contends, however, that the trial court should have applied CL 1948, § 692.251 et seq. (Stat Ann § 18.901 et seq.), “padlock law,” on the theory that defendant had the power to ask the court to declare such vending machines a nuisance and ask for its abatement. This law is invoked by a bill in chancery. None was brought although there was more than a reasonable length of time in which to bring it.
The trial judge stated that the presence of these machines may add to the convenience of the customers in purchasing candy or cigarettes but certainly did not contribute to the violation of the liquor law, neither were they implements in the hands of the unlawful operators to further the sale of liquor. We find no authority in People, ex rel. Wayne Prosecuting Attorney, v. Sill, 310 Mich 570, nor State, ex rel. Wayne Prosecuting Attorney, v. Martin, 314 Mich 317, to sustain the proposition that a vending machine owned by a third party who has in no way contributed to the violation should be confiscated under the authority of CL 1948, § 692.251 (Stat Ann § 18.901). Defendant contends:
“In the ease at bar, a cigarette vending machine is a necessary tool and machine used in the operation of an illegal gambling place, or an illegal place where liquor is sold or kept for sale on the premises without a license,”
but no logical reason is given for this conclusion. Cigarettes and candy are readily obtainable in legal establishments in any locality. Their presence does not make them implements that have any relation to the illegal sale of liquor.
The petition of plaintiff was properly granted and the order to return the machines to plaintiff is affirmed, without costs. ¡
North, C. J., and Dethmers, Carr, Btjshnell, Sharpe, Boyles, and Reid, JJ., concurred. | [
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North, C. J.
This case involves a dispute between rival factions of Division 1303 of the Amalgamated Association of Street, Electric Railway & Motor Coach Employees of America. The division or local will hereinafter be referred to as Division 1303. The dispute concerns seniority rights as between drivers in the Dayton (Ohio) district and the Detroit district, so-called.
On July 1,1947, the Great Lakes Greyhound Lines acquired by merger, control of the Cincinnati & Lake Erie Transportation Company (hereinafter termed C.&L.E.). Prior to C.&L.E. acquisition by Greyhound, both the employees of C.&L.E. and those of Greyhound had contracts with their respective employers in regard to seniority rights within their respective groups. At the time of acquisition a problem arose as to the seniority rights of the former C.&L.E. employees, who then became Greyhound employees. The contract then in force between Greyhound and Division 1303 contained a stipulation in part I, article 10, § 8, which provided:
“If, in acquiring a bus line which lies adjacent to and not paralleling existing lines of the company, regularly assigned operators already employed on such line are acquired, and accepted for employment by the company, they will retain seniority rights earned on such line or lines upon which they are already employed, but in no event will they exercise seniority beyond their respective division points, and in addition shall acquire seniority rights on lines of the company as of the date of acquisition. Operators affected thereby will thereafter carry seniority dates showing their rank on each line. Operators acquiring seniority on other lines shall rank themselves in accordance with their respective ratings held before such additional lines were acquired. Company will use its best efforts to transfer district seniority rights of operators, desiring to transfer on any division of that company which may be sold.”
Since many of the C.&L.E. lines were parallel to existing Greyhound lines (in fact in most cases they ran over the same routes as Greyhound lines) the provisions of section 8 would have had the effect, as to many of the former C.&L.E. drivers, of wiping out all their seniority acquired with the C.&L.E. prior to its acquisition by Greyhound. This effect was resisted by the C.&.L.E. group of drivers. As a compromise between this C.&.L.E. group, most of whom worked out of the Dayton district, and the other members of Division 1303, most of whom worked out of the Detroit district, an agreement was reached whereby drivers on runs originating in Dayton constituted one seniority group, and those on runs originating in Detroit constituted a separate seniority group. Thus the drivers on runs original ing in one district could not exercise seniority in regard to runs originating in the other district. This arrangement never completely settled the problem, for it appears there was still considerable discussion and agitation among the members of Division 1303 continuing right up to the time of this suit. We do not deem it necessary to go into the merits or demerits of this controversy in order to dispose of the instant case.
As an outgrowth of this seniority problem, a formal grievance was filed with the officers of Division 1303, which grievance charged that the Dayton group had failed to abide by section 8 of the contract between Division 1303 and Greyhound, above quoted. Thereafter many meetings were held between the officials of Division 1303 and Greyhound. Those meetings culminated in a stipulation, entered into on May 28, 1951, between Greyhound and the officials of Division 1303, which provided:
“That former employees of Cincinnati & Lake Erie Transportation Company shall commence to acquire seniority as of the date of acquisition, July 1, 1947, of said company by Great Lakes Greyhound Lines, in the Detroit seniority district as identified in section 4, article 10 of an existing labor agreement between the parties hereto;
“That employees of Great Lakes- Greyhound Lines now exercising seniority in the Detroit District as identified in section 4, article 10 of the labor agreement referred to above, shall commence to acquire seniority as of the acquisition date referred to in paragraph 1 above, in the Dayton seniority district as identified in section 5C of article 10 of the labor agreement above referred to.”
On June 11, 1951, Greyhound opened up a number of runs for bidding under this new seniority provision contained in the stipulation of May 28,1951, just above quoted. The run bids were to become effective at 12:01 a.m. on June 22, 1951. On June 16, 1951, plaintiffs, 61 in number, members of Division 1303, filed a bill in chancery in Wayne county seeking to enjoin Greyhound and Division 1303 from putting into effect the stipulation of May 28, 1951, and alleging that said stipulation was in violation of the existing contract between Division 1303 and Greyhound. On the same day a show cause order and a temporary restraining order were issued by the court. Both Greyhound and Division 1303 filed motions to dismiss the bill of complaint, and on July 3, 1951, an order was issued denying the motions .to dismiss and continuing the temporary restraining. order. An answer was filed by Greyhound and also by Division 1303. Plaintiffs filed replies to the answers. On August 20th, Division 1303 filed a motion for dissolution of the temporary restraining order, and on the same day plaintiffs filed an answer to this motion. The above motion was brought on to be heard and testimony was taken. At the conclusion of the proofs the court was of the opinion that the plaintiffs had not made out a case for relief, and expressed an intention to grant the motion of defendant Division 1303 to dissolve the restraining order. At the request of plaintiffs’ attorney, or at least with his approval, the court consented to enter an order dismissing the bill instead of an order dissolving the injunction, so that the plaintiffs would have a final order from which to appeal. Prom that order this appeal was taken.
It' is appellants’ contention on this appeal that the trial court erred in finding that the stipulation of May 28, 1951, was binding on the membership of Division 1303 included in the Dayton and Detroit rosters. The appellees assert that the trial court’s decision was correct because the stipulation of May 28, 1951, had in effect been voted upon at a “mass meeting” held on March 20, 1951. The particular question voted on at that meeting was whether the membership approved of the action taken by the Division’s executive board on a grievance filed on August 28, 1950. This grievance complained that article 10, § 8, above quoted, was not being enforced. It seems that when the first contract was negotiated between Greyhound and Division 1303 after the merger of C.&L.E. with Greyhound, article 10, § 5, was put in the contract in order to compromise the conflicting demands as to seniority made by the Dayton group of drivers and the Detroit group. Section 5 of article 10 provided:
“With respect to the Detroit and Dayton seniority districts, a master roster shall be built to show company seniority as master seniority.
“(a) District seniority may be exercised on the basis of master roster in the event of furlough, although employee shall have right to take furlough in his district instead of such transfer.
“(b) Employee on recall to his seniority district must return as required under regular recall procedure.
“(c) The Dayton district is entitled to all work on schedules originating and terminating in its district. Should work presently being performed between Toledo and Detroit be transferred to the Dayton district, members of the interurban roster shall be entitled to follow such work to the Dayton district with full seniority.”
On their face, sections 5 and 8 seem to be somewhat in conflict. The real object of the grievance seemingly was to have section 8 enforced in preference to section 5. Appellees contend that sections 5 and 8 are not in conflict if properly construed. Be that as it may, nevertheless among the 2 groups within Division 1303 there was disagreement as to just what the effect of these 2 sections should be. The grievance filed tended to bring this dispute to a head. Prior to the mass meeting of March 20, 1951, the officers of Division 1303 had been negotiating with Greyhound in regard to this dispute and had come to some sort of an agreement as to the seniority problem and the controversy over sections 5 and 8. This agreement (the record does not show what this agreement was except to say that it was embodied in the stipulation of May 28, 1951, between the company and the union) was considered by the union officers who negotiated it with Greyhound, to be a satisfactory settlement of the problem raised by the grievance filed August 28, 1950. Consequently, on March 20, 1951, at a regular mass meeting, 28 members being present (25 members constituted a quorum according to the Division’s bylaws), the question of whether to affirm or disaf-. firm the disposition made of the grievance of August 28, 1950, was voted upon, and the vote was 11 to 7 for approval. Following this vote of approval, the officers of Division 1303, the bargaining agent of plaintiffs, entered into the formal stipulation with Greyhound, on to-wit: May 28, 1951, hereinbefore quoted.
It is this action on the part of the officers of Division 1303 which is challenged by the group of 61 members of Division 1303 in their bill of complaint. They assert that the vote taken at the March 20th mass meeting was an improper ballot of the membership, did not correctly represent the will of the majority, and that the entire meeting at which the vote was taken was arbitrarily and improperly conducted.
While the suit was pending, and prior to any testimony being taken on the motion to dissolve the temporary restraining order which had been issued when the bill of complaint was filed, a ballot was mailed to each of the members of Division 1303 whose name was on the Dayton and Detroit rosters. This ballot specifically asked whether the member approved or disapproved of the agreement which had been entered into between Greyhound and the officers of Division 1303. In all 203 ballots were mailed. Of these 101 were returned marked “yes” (indicating approval) and 62 were returned marked “no” (indicating disapproval). Twenty-six of the ballots returned were not opened because they were ballots of men employed subsequently to the stipulation of May 28, 1951. These 26 were opened in court and the record shows that 25 were marked “no” and 1 was marked “yes.” The remaining 14 ballots were either not delivered, not returned, or disqualified because the member was then on supervision or in the military service. In any case it is clear that a majority of the ballots voted were marked “yes.”
Appellants contend that this ballot vote was absolutely void because no meeting was called for purposes of discussing the proposal and no time was allowed for discussion. Further, that the question was unfairly stated on the ballot and the list of voters was unfairly and arbitrarily chosen by .the officers who prepared and sent out the ballots.
We agree with the trial judge who was of the opinion that the ballot taken by mail expressed the will of the majority of the members of Division 1303 who were involved in the instant controversy. Further, for reasons about to be noted, we think the trial judge would have been right in dismissing the bill of ■ complain! even if the ballot by mail had not been taken. Even if it should be assumed that the election of March 20th was not in character thoroughly democratic; and that it did not result in a fair expression of all concerned; still the record shows that a vote was taken and that 11 out of 18 who participated voted to affirm the action that had been taken by the executive board incident to the grievance of which plaintiffs complain. And it is important to note that if this determination was not fairly arrived at, the constitution and general laws of the union provided a method whereby the matter could have been appealed within the framework of the union. It is not the business of an equity court to assure union members that their union affairs shall be conducted in a thoroughly democratic manner.
“When the bylaws of fraternal organizations, if reasonable and valid, provide a mode for determining when relief shall be given or denied to members by tribunals provided for therein, redress therefor ' may not be sought in the courts; (Citing numerous cases.)” Ryan v. New York Central R. Co., 267 Mich 202, 209.
Regardless of any of the claimed irregularities in the earlier proceedings, the vote by mail of the union members named in the Detroit and in the Dayton rosters resulted in a final approval of the action taken by the union representatives. In announcing his conclusion at the close of the hearing, the trial judge stated:
“I will issue an order dismissing it (the bill of complaint), if you wish me to, on the grounds the matter has been settled by this vote and on the grounds the plaintiffs did not exhaust all of their remedies within the union before they applied to the court.”
On each of the above grounds, dismissal was proper. Division 1303 was the bargaining agent of plaintiffs. As to seniority rights, as stated by the trial judge: “The contract (with the employer) is with the union and not the men, and the union through their representatives and a majority vote (of the union members concerned) may change the contract at any time.” These plaintiff-employees were bound by the agreement made by their bargaining agent with the Great Lakes Greyhound Lines and ratified by the vote taken by mail. Plaintiffs herein are not entitled to injunctive relief against defendants proceeding to render effective seniority rights in accord with such agreement. Hartley v. Brotherhood of Railway & Steamship Clerks, Freight Handlers, Express & Station Employees, 283 Mich 201.
The trial court was also justified in dismissing plaintiffs’ bill of complaint on the ground that plaintiffs could not resort to court action until they had exhausted “all of their remedies within the union before they applied to the court.” Section 81 of the “Constitution and General Laws” under which the union and its members operate, provides in substance that any member or members of a local division feeling that they have been unlawfully dealt with by the local division have a right to appeal to the international president and the general executive board, and from the general executive board to the convention of the association, but that such members must not take legal action or go into court until they have exhausted all their rights within the association and have finally appealed to the convention. Plaintiffs did not before instituting this suit and obtaining a restraining order appeal from the action taken by Division 1303. Hence, the court did not have jurisdiction because plaintiffs as members of a voluntary association, under the circumstances of this case, were bound by the provisions of the union’s constitution and general laws. Ryan v. New York Central R. Co., supra; Harris v. Detroit Typographical Union, 144 Mich 422.
In considering this appeal we have been mindful of plaintiffs’ contention that the selection of those who were to vote on the proposition submitted was improper; that the ballots were improperly counted; that the ballot as taken was improper in that it, lacked the essential elements of due process; and plaintiffs’ further contention “That for many years experience had established the impossibility of having a ‘mass meeting’ of the members entitled to vote on questions calling for a vote * * * without holding meetings for the discussion of said questions by divisions and thereafter submitting said questions to decision by written referendum by mail.” After consideration of the above, and all other contentions of appellants, we are of the opinion that none of them would justify reversing the decree of the trial court. The controversy which gave rise to the instant litigation had been a matter of contention for many months between various parties interested in the question of seniority herein involved. The only employees concerned in the controversy were those whose names appeared as members of the union on the Detroit and Dayton rosters; and as to all such employees ballots in appropriate form were provided to them, and the result of the vote taken by mail was approval of the ruling of which plaintiffs herein complain.
The decree entered in the circuit court is affirmed, and appellees may have taxable costs of this Court.
Butzel, Carr, Bushnell, Sharpe, Boyles, and Reid, JJ., concurred with North, C. J.
Dethmers, J., concurred in the result. | [
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Boyles, J.
Plaintiff filed with the workmen’s compensation commission an application for compensation alleging that on December 24, 1948, he suffered an injury to his back while in the employ of the defendant. His work was lifting heavy wheels, weighing 35 to 40 pounds, from a chain conveyor about chest high and placing them on a skid behind him 8 or 9 inches from the floor. The wheels on the conveyor were from a washer in which the water was kept at 20Ó to 212 degrees and were handled by 2 men, about 6 wheels per minute. The operation required lifting them, then turning the wheels to empty any water, then by turning the body depositing the wheels on the skid.
On January 3,1949, plaintiff reported to defendant that he had pain in the lumbar region, stating it was due to lifting the wheels. He was given heat, massage, and a sacroiliac belt. Shortly afterward he was again treated by defendant’s plant physician, on January 17th taken to Sparrow hospital for emergency treatment, given heat treatments by defendant’s first aid on January 18th to 22d, inclusive, and on January 27th the plant physician found him unable to work because of his back. He was absent from work from late in January to August 1st.
On February 17, 1950, plaintiff filed the instant application with the workmen’s compensation commission for hearing and adjustment of claim for personal injury. The application was heard in 2 contested hearings before a deputy, followed by an appeal to the commission by the defendant from an award of compensation by the deputy. On July 20, 1951, the commission entered an order affirming the award, and on leave granted the defendant appeals, raising 3 questions for reversal.
1. Appellant claims that it did not have notice of an injury arising out of plaintiff’s employment within the time required by statute. The claim is not supported by the facts. Defendant not only had notice as well as knowledge of plaintiff’s injury, but it also promptly treated plaintiff for his disability. The facts are not at all comparable to Amamotto v. J. Kozloff Fish Co., 317 Mich 641, on which appellant relies.
2. Appellant claims that the commission did not have jurisdiction to hear and adjust plaintiff’s claim because it was not timely filed under the statute. Plaintiff suffered a compensable injury of which the defendant had prompt notice and knowledge, yet the defendant failed to file a report of the same with the commission. The cause of plaintiff’s absence from work from January 26 to August 1, 1949, due to his back injury was known to the defendant. The defendant’s failure to file a report of the injury with the commission bars its attempted defense that the claim for compensation was filed too late. Shaw v. General Motors Corporation, 320 Mich 338.
3. Finally, appellant argues that plaintiff’s disability results from an ordinary disease of life to which the public is generally exposed and consequently is not compensable. The facts take the case outside of and beyond such a claim. Plaintiff’s work required rapid and repeated twisting of the body, lifting heavy objects, bending over and placing- them near the floor level. This was entirely more than the work to which the public is generally exposed. It was so held in Underwood v. National Motor Castings Division, Campbell, Wyant & Cannon Foundry Co., 329 Mich 273, and cases cited therein. See, also, Fields v. G. M. Brass & Aluminum Foundry Co., 332 Mich 113.
Award affirmed.
North, C. J., and Dethmers, Carr, Btjshnell, Sharpe, and Reid, JJ., concurred.
Butzel, J., did not sit.
CL 1948, §412.15 (Stat Ann 1951 Cum Supp § 17.165).—Re-porter. | [
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] |
Butzel, J.
John E. Boscarino, plaintiff and cross-defendant, filed a bill for divorce against Mary Jane Boscarino, defendant and cross-plaintiff. She in turn filed a cross bill for separate maintenance. The trial judge, after a hearing, dismissed both bill and cross bill. Defendant as cross-plaintiff appeals.
The parties were married in 1941, shortly before plaintiff was called into service. After his honorable discharge the parties moved to Detroit, where they lived for a time with defendant’s parents. Defendant gave birth to twins on September 26, 1946. She was not in the best of physical condition and may still be in need of some surgery. The record does not indicate that this may have caused some emotional disturbance. Defendant had been working for a considerable period prior to the hearing.
The parties purchased a home in the suburbs of Detroit, but owing to the fact that plaintiff was working nights, and defendant with her small babies would be alone in the house, they moved back to the home of defendant’s parents, the equity in the home was sold, and almost the entire proceeds were paid to defendant’s brother to be used in the purchase of the latter’s interest in a home he and plaintiff’s father were purchasing.
On the return of the parties to the home of defendant’s parents, there was considerable disagreement. This was partly due to the fact that plaintiff’s sister had secured a divorce from defendant’s brother, engendering much bad feeling among the “in-laws.” Plaintiff claims that defendant’s father urged them to get out and into a home of their own. Defendant’s mother, on the other hand, was not sympathetic, and plaintiff claimed she interfered to such an extent that he could not stand it any longer. He finally asked defendant to help establish an independent home but she refused. His emotional instability is shown by his bidding each member of the family an affectionate farewell and leaving the house. He has not returned, even to see the children.
Plaintiff gave defendant his last pay check, but when she called him 4 days after he left, he told her that she would have to go to court for anj> further support. This she did, and within 2 weeks he appeared before the domestic relations department of recorder’s court, where he agreed to pay $25 per week towards the support of the family. Plaintiff testified that the reason he did not visit the children or wife was because of his marital troubles he had become almost a nervous wreck. He testified that defendant had told Mm that she would not leave her mother’s home, that if he did not like it he should leave; that defendant’s mother told Mm that if he left, she was going to see to it that he would not see the children.
Plaintiff appears to be an industrious man with no bad habits. He gave Ms pay check regularly to Ms wife, only taking a few dollars for Ms personal wants. Defendant also is a hard working woman. Evidently their troubles arose almost entirely from the interference of relatives on both sides of the family. It is true that plaintiff has no home to take Ms family to, but that is not an insurmountable difficulty. They have sufficient household furniture so as to furnish a rented home. We are satisfied on reading the record that the circuit judge was absolutely correct in holding:
“I don’t feel that under all the circumstances in this case these parties should he allowed to separate. I think that they can get along if they will just give a little give and take to this proposition, * * # for the sake of these children, which is a tremendous responsibility, which they must have to account for some day — that I cannot in justice or conscience grant a divorce to either of the parties.”
We might add that the “in-laws” involved herein have a grave responsibility toward the parties and their little children and can help much in bringing about a complete reconciliation, which plaintiff has sought a number of times but which defendant has refused.
The decree is affirmed. No costs.
North, C. J., and Dethmers, Carr, Btjshnell, Sharpe, Boyles, and Reid, JJ., concurred. | [
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10,
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81,
41,
20
] |
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