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Danhof, C.J.
By order dated November 25, 1986, the Oakland Probate Court terminated respondent James Stowe’s parental rights in Teresa Nadine Stowe (born November 30, 1970) and Nicole Diane Stowe (born September 30, 1972). The respondent’s rights were terminated pursuant to MCL 710.51(6); MSA 27.3178(555.51)(6) in the context of separate petitions by the children’s stepfather, Ralph Martin, to adopt them. The petitions alleged that respondent had not provided financial support or communicated or visited with his children within two years prior to the filing of the adoption petitions.
The adoption petitions were filed on May 14, 1984. On June 29, 1985, before the termination hearing was conducted, Sandra Martin, the children’s natural mother and the petitioner’s wife, died.
The termination hearing was held on October 16, 1986. At the hearing, the petitioner testified that respondent and Mrs. Martin separated in October of 1977 and that he began dating her in 1978. A judgment of divorce was entered on March 22, 1979. On March 18, 1980, petitioner and Mrs. Martin married. From the date of their mother’s marriage to petitioner, until the date of the hearing, Nicole and Teresa resided with petitioner.
Nicole testified that she had not seen or communicated with respondent in nine years and was agreeable to the adoption.
Respondent first contends that, upon Sandra Martin’s death, the probate court lost jurisdiction to terminate his parental rights. We disagree.
MCL 710.51(6); MSA 27.3178(555.51)(6) provides in part:
If the parents of a child are divorced . . . and if the parent having legal custody of the child subsequently marries and that parent’s spouse petitions to adopt the child, the court upon notice and hearing may issue an order terminating the rights of the other parent.... [Emphasis added.]
Thus, the above portion of the statute clearly indicates that the petitioner is to be the stepparent. Nothing in the statute indicates that the custodial natural parent must join in the petition. MCR 5.753 provides that the interested parties in a petition to terminate the rights of the noncustodial parent pursuant to the instant statute are the petitioner, the adoptee, if over fourteen years of age, and the noncustodial parent. The custodial parent is not listed. Under the established rule of construction that the express mention of one thing implies the exclusion of another, Michigan Mutual Ins Co v Allstate Ins Co, 146 Mich App 475; 382 NW2d 169 (1985), aff'd 426 Mich 346; 395 NW2d 192 (1986), we conclude that a natural, custodial parent is not a necessary party to a stepparent’s adoption petition filed pursuant to MCL 710.51(6); MSA 27.3178(555.51)(6). This interpretation is consistent with other portions of the Adoption Code which are not necessarily related to a specific contest between a stepparent and a natural parent. For example, see MCL 710.43(l)(a)(vi); MSA 27.3178(555.43)(l)(a)(vi), which provides that the consent of a parent having legal custody of the prospective adoptee is not necessary if that parent is married to the petitioner.
Policy reasons require the same result. The primary purpose of the statute is "to foster stepparent adoptions in families where the natural parent had regularly and substantially failed to support or communicate and visit with the child.” In re Colon, 144 Mich App 805, 810; 377 NW2d 321 (1985).
Respondent also claims that the proofs were insufficient because petitioner’s testimony concerning the lack of support was hearsay and thus improperly admitted. Respondent contends that petitioner’s testimony was gleaned solely from what Mrs. Martin had told or showed him.
At one point, petitioner testified that Mrs. Martin wrote the checks for their expenses but that she would always tell or show him what she had done. However, petitioner also testified that he assisted Mrs. Martin in the bookkeeping and that he was aware of all of the family’s sources of income. In addition, petitioner testified that he and Mrs. Martin had always filed a joint income tax return. We decline to infer from the above testimony that petitioner’s knowledge was based solely on what Mrs. Martin had told or showed him. A negative fact is extremely hard to prove. In our opinion, respondent’s lack of support was sufficiently proven by petitioner’s testimony that he was aware of no incoming support payments. Given the fact that petitioner and Mrs. Martin had been married for five years, that petitioner testified that he assisted in the bookkeeping, and that the receipt of support income for one’s stepchildren is something a stepparent would normally be aware of, we conclude that there was sufficient prima facie proof of the lack of support. Our holding is also based in part upon the fact that petitioner’s testimony was uncontroverted. Respondent did not appear or testify at the termination hearing.
Respondent also claims that the trial court violated MRE 1002, the so-called "best evidence rule.” Respondent argues that this rule was violated when the trial court permitted Martin to testify over objections that the family account book indicated that respondent had not provided financial support. Respondent asserts that the financial record books themselves should have been introduced.
While we agree that error occurred, reversal is not required. As indicated above, the record sufficiently indicates that, aside from petitioner’s testimony concerning the content of the family account books, sufficient evidence was introduced on the lack of support.
Next, respondent asserts that the probate court erred by taking judicial notice of the judgment of divorce between respondent and Mrs. Martin. Respondent argues that under MRE 1002, the original judgment of divorce had to be introduced at the termination hearing.
The content of the judgment of divorce was crucial since the statute requires proof not only that the noncustodial parent has failed to provide support, but also that the noncustodial parent has the ability to provide support. In In re Colon, supra, this Court held that a showing that a valid order exists requiring the noncustodial parent to provide support is sufficient proof of this element. Such an order already takes into account the parent’s ability to pay. In the instant case, the judgment of divorce was the only proof submitted on the issue of respondent’s ability to pay.
While MRE 1002 provides that the original is generally required in order to prove the content of a writing, the rule also states, "except as otherwise provided in these rules or by statute.” MRE 201(b) permits a judge to take judicial notice of facts which are "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” In the case at bar, the instant petition was filed in Oakland County, the same county in which the judgment of divorce had been entered and was presumably on file. Thus, the fact that respondent had been ordered to pay child support was a fact which could be readily and accurately determined by reference to a source whose accuracy cannot be questioned. Since the court may take judicial notice of such facts, it follows that the petitioner in the instant case was not required to either present the original copy of the judgment or introduce the judgment at the hearing. Knowlton v Port Huron, 355 Mich 448, 452; 94 NW2d 824 (1959). The copy of the divorce judgment attached to the initial petitions was sufficient to advise the court that a valid divorce judgment was on file.
Respondent’s final argument is that he was deprived of his right to cross-examine Mrs. Martin. Apparently respondent contends such a right exists because Mrs. Martin initially signed the adoption petition, purportedly as a copetitioner. Respondent’s appellate counsel proceeds to argue that it could possibly be inferred from the record that the Martins never told respondent where the children were for purposes of visitation. Evidently, respondent is contending that if Mrs. Martin could have testified, such evidence could have been produced.
We have already concluded that Mrs. Martin was not a necessary party to the adoption petition. The decision of the probate court was not based on any evidence presented by Mrs. Martin. Her un timely death, contrary to what respondent would apparently have this Court hold, does not prevent the action from proceeding. There is no right to cross-examine at a hearing an individual who does not testify, who is unavailable, and whose testimony is not essential. Moreover, respondent himself could have produced the same evidence he now contends could have been gained through the cross-examination of Mrs. Martin, assuming it was true, if he had chosen to attend the hearing.
Having rejected each of respondent’s claims of error, we conclude that the termination of respondent’s parental rights was based upon clear and convincing evidence.
Affirmed.
If facts are readily verifiable, litigants are fully protected in the event a court takes notice of a fact which is not true. MRE 201(d) provides a party with the right to be heard even after judicial notice has been taken in the absence of prior notification. In the instant case, there is no claim that the noticed fact is incorrect and respondent has taken no steps, such as a timely request for a hearing, to dispute the noticed fact. | [
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Shepherd, J.
The jury convicted defendant of first-degree murder and possession of a firearm during the commission of a felony and acquitted him of assault with intent to murder. Defendant appeals, arguing that admission of evidence of his accomplice’s guilty plea to a lesser charge arising out of the same incident was error. We affirm.
Most of the persons in this case were involved with the sale of drugs. Defendant was tried for the shooting death of Kevin Taylor. Glenn Thomas was also charged with first-degree murder and assault with intent to commit murder for the same incident. Approximately three weeks before defendant’s trial, however, Thomas pled guilty to as sault with intent to do great bodily harm, for which he received a sentence of from five to ten years in prison. In exchange, he agreed to testify against defendant and another potential defendant.
Thomas testified that defendant received a call while they were moving some items and they went to Frederick Blakely’s home. Blakely gave defendant a gun. Defendant asked Thomas to come along and the three went down an alley to where Taylor stood talking with Carl Branham. Thomas concluded that defendant was going to rob them. Defendant called for Taylor and Branham to "come here” and then told Thomas to grab Bran-ham. Defendant pulled out the gun and fired two shots at Taylor and two or three shots at Branham as he ran away. Taylor died, but Branham was not hit. Thomas saw no weapons on Taylor or Bran-ham at any time, nor did they make any threatening gestures towards defendant. According to Thomas’ testimony, defendant later told Thomas that he shot the wrong person and would not get paid. Branham’s description of the shooting was similar to Thomas’, and Branham indicated that he and Taylor had talked to Blakely about selling drugs a short time before the shooting.
Defendant testified, however, that he received a call from someone named Roy and went to Blakely’s house to pick up money Taylor owed him from a drug deal. Blakely told defendant that Taylor had just left, and had money and a pistol. Defendant borrowed Blakely’s gun and held it visible in his hand as he walked towards Taylor, though defendant said it was at his side. Taylor walked towards defendant and told him he had no money. Defendant told Thomas to watch Branham and to hold him. As Taylor approached, defendant thought he was reaching for a gun and was going to shoot defendant, so he. fired two shots. Taylor’s gun fell to the ground. Defendant fired two more shots in the air. He then picked up and kept Taylor’s gun.
During voir dire, both the prosecutor and defense counsel alluded to the fact that one witness would be a "snitch” who had received "some considerations” or a "break” for testifying. During opening statements, however, the prosecutor fully described Thomas’ plea bargain, emphasizing that Thomas would go to prison whatever the outcome of defendant’s trial. The prosecutor also emphasized that, while Thomas was getting "something out of it,” he was also a person who "did something wrong” but was going "to face up to it.” Defense counsel did not object. The prosecutor fully questioned Thomas concerning his plea-based conviction on the reduced charge at the beginning of Thomas’ direct testimony. Defense counsel did not object and, in fact, inquired briefly about the reduced charge and suggested that Thomas’ guilty plea was "no big deal” because he had violated his parole and likely would have gone to prison anyway. On redirect examination, however, Thomas indicated that no bargain had been struck as to parole violations. Thomas’ plea agreement was introduced as an exhibit. Defense counsel indicated he had no objection.
During the conference on instructions, the prosecutor requested the accomplice standard jury instructions. Defense counsel objected to that portion of CJI 5:2:01 concerning the fact that Thomas had been convicted of charges arising out of the same incident, arguing that such an instruction was improper under People v Lytal, 415 Mich 603; 329 NW2d 738 (1982).
The prosecutor stressed Thomas’ guilty plea during closing argument, comparing Thomas’ and Branham’s versions of the story with defendant’s claim of self-defense:
Perhaps one of the most telling things about whether or not this really was self-defense is from the fact that Mr. Thomas took a deal to testify. If this was really self-defense on the part of Mr. Kincade, do you think that Mr. Thomas would have booked the next five years in prison. Because if this was really self-defense on Mr. Kincade’s part, he would have a defense. He’d be able to say, I was helping someone defend himself. Use your common sense and reason, ladies and gentlemen. You are in a position where you’re not guilty of anything. Are you going to go and put yourself away for five to ten years.
At the conclusion of his argument, the prosecutor again asked the jury to consider "if this really was self-defense, why would he put himself away for five to ten years.” Defense counsel made passing references to Thomas’ "deal” during closing argument. In rebuttal closing argument, the prosecutor urged the jury to read the plea agreement during deliberations.
The accomplice instructions given did not refer to Thomas’ plea-based conviction.
Where an accomplice or coconspirator has been granted immunity or other leniency to secure testimony, or has reasonable expectation of such leniency, it is incumbent upon the prosecutor and trial court to disclose such facts to the jury upon defendant’s request. People v Atkins, 397 Mich 163, 173; 243 NW2d 292 (1976). The general rule, however, is that the conviction of another person involved in the criminal enterprise is not admissible at defendant’s separate trial, Lytal, supra at 612:
The prosecutor is not obliged to show that no consideration was offered for a witness’s testimony or, indeed, whether the witness, if charged and if an accomplice, was convicted or acquitted. The prosecutor is only obliged to disclose any consideration offered to or received by the witness. That can be done without adverting to whether the witness was, if charged, convicted.
In a case involving a trial-based conviction, the standard for determining whether the error requires reversal is whether the defendant was unfairly prejudiced by the evidence. People v Allen, 424 Mich 109; 378 NW2d 481 (1985).
This Court has held that Lytal does not apply to cases involving plea agreements, wherein recitation of the consideration offered necessarily includes "a reference to the accomplices’ pleas to a reduced charge.” People v Buschard (On Remand), 129 Mich App 160, 164; 341 NW2d 260 (1983). See also Justice Boyle’s plurality opinion in People v Standifer, 425 Mich 543, 552-555, 559-560; 390 NW2d 632 (1986), joined by two other Justices. The numerous problems created by attempts to reconcile Lytal, Atkins, and Standifer are discussed well in the recent case of People v Rosengren, 159 Mich App 492; 407 NW2d 391 (1987), another case finding no error in the admission of a testifying accomplice’s plea bargain. Rosengren also found no manifest injustice.
No logical connection exists between the accomplice’s guilt as reflected by his guilty plea and the question whether defendant fired the shots. Thomas’ guilty plea cannot be used to infer defendant’s guilt as to the shooting. The use of Thomas’ plea as substantive evidence of defendant’s guilt would require reversal. See People v Eldridge, 17 Mich App 306, 316-317; 169 NW2d 497 (1969). See also Standifer, supra at 552, n 4 (Boyle, J.); People v Crawl, 401 Mich 1, 33, ns 24, 25; 257 NW2d 86 (1977) (Levin, J.).
Such is not the case here, however, because defendant admitted the shooting. What we have instead is a self-defense claim, the validity of which involves a perception of the totality of the circumstances, including threats allegedly made to defendant. Thomas, however, testified that Taylor did not threaten defendant. We believe the prosecutor’s argument in this case can reasonably follow from that evidence. It appears that Thomas’ guilty plea has at least some minimal logical connection to the proofs concerning the circumstances surrounding Taylor’s death.
An argument could probably have been made by defendant that the guilty plea bears no logical connection to defendant’s self-defense claim. If no logical connection existed as a matter of law, we believe reversal would be required. Defendant might also have argued that the evidence was more prejudicial than probative under the circumstances.
Defendant did not object, however, save at the instructions conference and only on the basis of Lytal. Any error from the prosecutor’s argument could have been promptly- cured. Defendant offered nothing to refute the minimal logical connection we find in the argument. Given this connection and the fact that the evidence was not used as substantive evidence of defendant’s guilt but, rather, to refute the self-defense theory, we cannot conclude that defendant was unfairly prejudiced or that manifest injustice occurred.
Affirmed.
G. S. Allen, Jr., J., concurred. | [
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Per Curiam.
Defendant, Thomas J. Lindberg, was convicted by a jury of uttering and publishing, MCL 750.249; MSA 28.446, and false pretenses with intent to defraud over $100, MCL 750.218, MSA 28.415, and pleaded guilty to a charge of being an habitual offender, second offense, MCL 769.10; MSA 28.1082, based on a prior conviction for breaking and entering a coin-operated device. At that time, defendant also had prior convictions for manslaughter and possession of a firearm during the commission of a felony. On August 13, 1985, the Oakland Circuit Court sentenced defendant to a term of from three to fourteen years on the uttering and publishing conviction, and from three to ten years on the false pretenses conviction, both of which sentences were vacated upon imposition of the terms of from six to twenty-one years and from six to fifteen years, respectively, under the applicable habitual offender statute. Defendant now appeals as of right, and we reverse his convictions and remand the case for a new trial.
The record reveals that on April 6, 1983, defendant gave seventy-three-year-old Mary Greisser a check with a forged endorsement. Greisser and her grandson, William Mayfield, defendant’s friend, testified that defendant assured Greisser that the federal income tax refund check in the amount of $441.25 had been properly endorsed to him by the named payee, Brenda Barnes, as payment for work defendant had performed on Barnes’ car. Defendant told Greisser that he could not cash the check himself because he had no bank account, which prompted Greisser to agree to deposit the income tax check into her own account and to write defendant a check when the $441.25 was credited to her by the bank. On April 12, 1983, Greisser wrote a check on her account for defendant, and defendant cashed it. About six months later, the federal government determined that the endorsement on the income tax check was a forgery. The bank froze Greisser’s account and charged her $441.25. According to Greisser and Mayfield, defendant promised to pay Greisser back, but did not do so for about two years. Thereafter, Greisser pressed charges and a few days before the March 18, 1985, preliminary examination, defendant admitted to Greisser that he knew the check was bad; he then paid her back in cash.
Brenda Wilson, formerly Brenda Barnes, testified that when she did not receive her federal income tax check for 1982 she contacted federal authorities in Columbus, Ohio. After identifying her purported signature on the back of the check as a forgery, she was issued another check by the government. She stated that she did not know defendant and that he had never done any work for her.
Defendant, an unemployed master mechanic, testified that a neighbor named Johnny had brought Brenda Barnes to defendant’s house, explaining to defendant that Barnes’ car had serious engine problems. Defendant stated that he subsequently installed a rebuilt engine into Barnes’ car and that she paid him with a federal income tax refund check which she endorsed to him. On cross-examination it was disclosed that the endorsement of Brenda Barnes’ name was spelled "Brenda Barns.” Defendant explained that normally his father-in-law cashed his checks, but that since at that time his father-in-law was out of town, he requested William Mayfield to ask his grandmother to cash the check. She cashed the check and later gave defendant the cash. According to defendant, when, about six months later, Greisser told him that the check was bad, he immediately gave Greisser $50 and thereafter paid back the balance in small amounts over the course of time. Defendant also asserted that when criminal charges were filed against him, he again paid back complainant in full on March 15, 1985, believing that Greisser would no longer press charges.
On appeal, defendant first argues that the trial court’s failure to comply with the requirements of MRE 609 and applicable case law regarding the admission of his prior convictions mandates reversal. In particular, defendant contends that the trial court failed to articulate on the record its reasons for admitting evidence of his prior convictions, and that that failure requires reversal in this case. We agree.
Just before the commencement of trial, defendant requested that evidence of his prior convictions be suppressed. He argued that his prior conviction for breaking and entering a coin-operated device be suppressed on the basis of its similarity to the charged crimes of uttering and publishing and of false pretenses, reasoning that all these offenses involved larcenous activity. The prosecutor argued in response that all of defendant’s prior convictions, including those for breaking and entering a coin-operated device, manslaughter, and possession of a firearm during the commission of a felony, be admitted into evidence because "they’re more probative than prejudicial.” The ruling in full by the circuit judge on defendant’s motion was: "The Court is going to deny the motion.”
Effective May 14, 1980, the Supreme Court amended MRE 609 (a)(2) to require a court, when determining the probative value of admitting evidence of prior convictions for the purpose of impeaching a witness’ credibility, to articulate on the record the factors considered in making its determination. 408 Mich cxv. Despite the amended language, however, the majority of panels of this Court which have addressed this issue have held that the failure of a trial court to articulate on the record the factors considered in determining the admissibility of prior convictions does not alone mandate reversal. See, e.g., People v Eggleston, 148 Mich App 494, 502-503; 384 NW2d 811 (1986); People v Gendron, 144 Mich App 509, 376 NW2d 143 (1985), lv den 425 Mich 853 (1986); People v Cummings, 139 Mich App 286; 362 NW2d 252 (1984); People v Ferrari, 131 Mich App 621; 345 NW2d 645 (1983), lv den 421 Mich 852 (1985); People v Steele, 115 Mich App 758; 321 NW2d 804 (1982) . Cf. People v Terryes Johnson, 122 Mich App 172; 333 NW2d 32 (1982), lv den 417 Mich 897 (1983) . Rather, harmful error occurs, and reversal is therefore required, only if the transcripts indicate that the trial court was unaware of its discretion to rule on the issue and affirmatively misapplied any of the factors enunciated in People v Crawford, 83 Mich App 35, 39; 268 NW2d 275 (1978). People v Bell, 155 Mich App 408, 411-412; 399 NW2d 542 (1986); People v Handley, 422 Mich 859; 365 NW2d 752 (1985), rev’g People v Handley (On Remand), 135 Mich App 51; 352 NW2d 343 (1984) . The Crawford factors, which have often been repeated by this Court, are as follows:
(1) the nature of the prior offense (did it involve an offense which directly bears on credibility, such as perjury?), (2) whether it is for substantially the same conduct for which the defendant is on trial (are the offenses so closely related that [there is] danger that the jury will consider the defendant a "bad man” or infer that because he was previously convicted he likely committed this crime, and therefore create prejudice which outweighs the probative value on the issue of credibility?), and (3) the effect on the decisional process if the accused does not testify out of fear of impeachment by prior convictions (are there alternative means of presenting a defense which would not require the defendant’s testimony, i.e., can his side of the story be presented, or are there alternative, less prejudicial means of impeaching the defendant?). [Crawford, supra, p 39.]
In the instant case, the trial court did not demonstrate that it applied the Crawford factors in deciding to deny defendant’s motion to suppress evidence of prior convictions. Indeed, the trial court did not articulate on the record any factors that it considered in denying defendant’s motion. The only possible indications on the record from which we might infer that the trial court was aware that its decision was discretionary were the facts that the motion was heard, both parties were permitted to speak, and the prosecutor mentioned that evidence of defendant’s prior convictions was more probative than prejudicial. Neither the prosecutor nor defendant nor the trial court mentioned MRE 609 or. the case law interpreting it. Such a situation does not reveal to us that the trial court was aware of the discretionary nature of its ruling, but rather indicates that the trial court may well have been unaware of the applicable rule of evidence and the relevant precedent. Since evidence of a defendant’s prior convictions is not automatically admissible, we find that, under the facts and circumstances of this case, the trial court erred in peremptorily denying defendant’s motion without explanation. Moreover, we cannot consider such error to be harmless because, had the court considered the proper factors, some or all of defendant’s prior convictions may have been excluded from evidence, thus enhancing the credibility of defendant’s testimony regarding having legally obtained the income tax refund check as payment for work performed on Brenda Barnes’ car.
Although our disposition of defendant’s first issue on appeal requires reversal of his convictions, thus not necessitating a review of the remaining issues raised on appeal, we comment on a second issue so that, upon a retrial, similar error will not reoccur. In particular, we detect that prosecutorial misconduct occurred as a result of questions posed to defendant on cross-examination regarding a sentence imposed for defendant’s prior criminal activity.
During cross-examination of defendant, and despite the strenuous and constant objections lodged by defense counsel, the prosecutor posed the following questions to defendant:
Mr. Lindberg, you don’t really have a lot to lose by perjuring yourself from the stand; isn’t that true?”
Isn’t it in fact, true that . . . the state can’t punish you much more than you’re being punished right now?
You can’t do much more time than what you’re doing now?”
Isn’t it, in fact, your understanding that you can’t be punished much more than what you’re being punished for right now for other things?
We find this line of questioning to have been improper.
Michigan statutory law eliminated the old common-law disability which prevented those convicted of a crime from testifying in a court of law. MCL 600.2158; MSA 27A.2158. Nevertheless, such a disability partially persists in the form of methods for impeaching a witness’ credibility through the use of evidence of prior convictions. Id.; MRE 609; People v Bouchee, 400 Mich 253, 268; 253 NW2d 626 (1977); People v Jackson, 391 Mich 323; 217 NW2d 22 (1974). However, the statute abrogating the common-law rule is to be strictly construed. People v Nelson White, 26 Mich App 35, 39-40; 181 NW2d 803 (1970); People v Sanders, 43 Mich App 698, 705; 204 NW2d 706 (1972), rev’d on other grounds 394 Mich 439; 231 NW2d 639 (1975). Thus, it is error to cross-examine a defendant about the duration and details of prior prison sentences to test his credibility. People v Rappuhn, 390 Mich 266, 273-275; 212 NW2d 205 (1973); People v Coffey, 153 Mich App 311, 313; 395 NW2d 250 (1986). Were it otherwise, a defendant’s inhibition to testify would be further enhanced. Moreover, it is a defendant’s prior conduct, not the ensuing punishment for that conduct, which is relevant for purposes of impeachment because sentences for the same offense often vary from tribunal to tribunal and from judge to judge. Nelson White, supra, p 39; Rappuhn, supra, p 273. As a result, the introduction of the length of a defendant’s prior sentence is generally error requiring reversal. Id.
Although the prosecutor did not ask defendant for the precise length of his prior sentence, the overall line of questioning certainly suggested that, no matter what sentences defendant incurred as a result of the current charges or for a perjury charge, his prior sentence would inevitably be longer. In responding to defense counsel’s objections, the prosecutor stated that he was "trying to get into the motive that [defendant] would have to lie on the stand.” Thus, it appears that the prosecutor intentionally introduced evidence of defen dant’s sentence on a prior conviction for the purpose of testing defendant’s credibility, or his motivation and propensity for lying on the witness stand. Introduction of such evidence is impermissible.
Moreover, we cannot regard as harmless the prosecutorial error which occurred at trial on this issue, as we decline to speculate whether, and to what extent, the innuendo that defendant was already serving an extremely lengthy sentence, and thus was unconcerned with the risks attendant upon committing perjury, may have influenced the jury in its decision to convict defendant. Nelson White, supra, p 40.
In light of our discussion and decisions on the above issues, we need not address the remaining arguments raised by defendant on appeal.
Reversed and remanded for a new trial consistent with this opinion. | [
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] |
Beasley, P.J.
In this medical malpractice case, defendant, William Beaumont Hospital, appeals as of right from a judgment entered on a jury verdict in favor of plaintiff, Brian Palenkas. By leave granted, plaintiff cross-appeals from an order of remittitur of the verdict from $1,250,000 to $800,000.
On appeal, defendant hospital raises two issues, and plaintiff raises one issue on cross-appeal. We reverse the trial court as to the statute of limitations issue raised by defendant and remand that matter for evidentiary hearing and decision by the trial court. As to the other issue raised by defen dant hospital, we affirm the trial court. As to the issue raised by plaintiff on cross-appeal, we reverse the trial court’s order of remittitur.
The parties essentially agree as to the underlying facts. On December 21, 1977, plaintiff was involved in a car accident which resulted in several serious, traumatic injuries. Taken to the emergency room at Beaumont Hospital-Troy, plaintiff received treatment from a team of specialists called in by Beaumont. Among those treating physicians was defendant, Dr. James M. Lawson, a plastic surgeon who had staff privileges at Beaumont and was on call that evening. Dr. Lawson was called in to treat plaintiff’s severely fractured lower jaw and injured teeth. During plaintiff’s stay at Beaumont, Dr. Lawson assumed the primary care for the treatment of plaintiff’s jaw. It was undisputed at trial that during plaintiff’s stay at the hospital Dr. Lawson was absent from the hospital for several days and failed to notify the hospital or obtain another physician to assume plaintiff’s care. Following plaintiff’s discharge from the hospital, Lawson continued to treat plaintiff for his jaw injury.
In the summer of 1978, plaintiff went to a dentist because, despite his continued treatment with Lawson, he continued to experience pain in his jaw, shifting of his jaw, twisting and turning of his teeth, and the presence of floating pieces of bone in his mouth. The dentist advised plaintiff that his jaw was collapsing and referred him to an oral surgeon.
The oral surgeon first saw plaintiff on September 19, 1978, and found that plaintiff had a deficient bite, a misshapen face, broken teeth that had not been removed, sequestered pieces of bone in the front lower jaw, and a tooth intruding into the jaw bone. He also found that plaintiff’s right lower jaw had tipped inward and that the collapse was not allowing the teeth to properly align in plaintiff’s mouth. Three times during the next year he performed surgery on plaintiffs jaw, which included removing the sequestered pieces of bone and broken and loose teeth, grafting a piece of bone from plaintiffs hip to his jaw, and repositioning his jaw. The last such surgical procedure took place on September 15, 1981, after which, for the next IV2 years, prosthetic reconstruction was performed on plaintiffs teeth.
On October 27, 1982, plaintiff filed a complaint against defendants Beaumont and Dr. Lawson, alleging that Lawson was negligent in his treatment of plaintiff and that Beaumont was negligent by improperly extending staff privileges to Dr. Lawson, by failing to properly supervise Dr. Lawson during his care and treatment of plaintiff, and by failing to have assured that the hospital employees or other staff physicians properly cared for plaintiff during his admission. Plaintiff also sought to hold Beaumont vicariously liable for the negligent acts and omissions of Dr. Lawson.
In answer to plaintiffs original complaint, inter alia, defendant hospital asserted, by way of affirmative defense, that plaintiffs claims were barred by expiration of the period of limitations. Prior to trial, this motion was never heard and decided. While the reasons for the trial court’s failure to hear and decide this motion are in dispute and will be further discussed, it seems altogether clear that this defense was not intentionally abandoned by defendant hospital.
As indicated, the automobile accident which gave rise to plaintiffs serious injuries and to these malpractice claims occurred on December 21, 1977, after which plaintiff was a patient in Beaumont Hospital-Troy. Plaintiff was last treated by the hospital at the time of release from the hospital in January, 1978. Not until October 27, 1982, did plaintiff start this suit against defendants, Dr. James M. Lawson and William Beaumont Hospital. Apparently plaintiff claims that he did not discover that he had a malpractice claim, until May or June, 1982, which, if established, would just barely bring plaintiff within the six-month period when he started suit on October 27, 1982. But, that is not the issue here because the trial judge never did decide the statute of limitations issue on its merits.
Although asserting the defense of the statute of limitations in its answer to the original complaint and to the amended complaint, defendant hospital did not file a motion for accelerated judgment and seek to bring it on for hearing. During trial in June, 1984, at the conclusion of presentation of plaintiff’s case, in the absence of the jury, and before presentation of its case, defendant hospital moved for accelerated judgment on the ground that the period of limitations had run before plaintiff started suit. Defendant hospital argued that plaintiff had not proved that he started suit within six months of the date of discovery of the hospital’s alleged malpractice, as required by MCL 600.5838(2); MSA 27A.5838(2). Defendant hospital claimed that the burden of proof was on plaintiff to establish when he discovered the malpractice because it was obvious that he did not start suit within two years of the date of the final treatment in defendant hospital in January, 1978, and, therefore, needed to establish that he started suit within six months of discovery of the malpractice or when he should have discovered the malpractice. Thus, defendant hospital claimed there was no issue of fact for the jury and it became a question of law for the court.
Plaintiff responded by claiming he was prepared to prove he first learned of the malpractice by defendant hospital when his attorney advised him in October, 1982. Plaintiff requested that he be allowed to reopen his case to prove these facts. The trial judge refused to permit plaintiff to reopen and noted that, when defendant asserted the affirmative defense of the statute of limitations, the burden was on plaintiff to show that he started suit within six months of his discovery of the hospital’s malpractice. But, rather than ruling on the matter, the trial judge took the matter under advisement. There was no suggestion by the trial judge at that time that she did not intend ever to rule on the merits of the motion. At that time, GCR 1963, 116.1(5) and 116.3 provided:
.1 Grounds. In a party’s first responsive pleading, or by motion filed not later than his first responsive pleading, a party may demand that service of process be quashed or that judgment be entered dismissing 1 or more claims asserted against him upon any of the following grounds:
(5) the claim is barred because of . . . statute of limitations ....
,3 ... As to defenses and objections based upon subrule 116.1(5), the court may order immediate trial of any disputed questions of fact, and judgment may be rendered forthwith if the proof shows that the moving party is entitled to judgment on the facts as determined; or the court may postpone the hearing on the matter until the trial on the merits, and shall postpone the hearing if a jury trial has been demanded pursuant to right on or before the day of the hearing.
Trial then resumed and the case eventually went to the jury without a ruling by the trial judge regarding defendant hospital’s motion for accelerated judgment on the ground that plaintiff’s claim was barred by the expiration of the period of limitations. Since the trial judge was holding the motion under advisement, it would seem that neither plaintiff nor defendant at that point was in a position to seek a special verdict from the jury regarding the statute of limitations question. On the other hand, neither plaintiff nor defendant hospital requested a jury instruction on the statute of limitations issue and both expressed approval of the jury instruction that was given. After the jury rendered special verdicts, defendant renewed its motion for dismissal by virtue of the statute of limitations, and the trial judge requested both sides to file briefs regarding the motion.
Later, on September 12, 1984, after receiving and reviewing the briefs, the trial court denied the hospital’s motion for accelerated judgment, ruling that by failing to seek a hearing on its motion prior to trial defendant had waived its affirmative defense resting on the running of the period of limitations. The court said, in part:
There is no question that where undisputed facts reveal the malpractice claim is barred by the Statute of Limitations, the question of when plaintiff discovered or should have discovered the claim becomes a question of law. That’s when we’re dealing with undisputed facts.
In this case, undisputed facts do not establish that the plaintiff realized at an earlier time that defendant had breached their standard of care. The record is silent in that regard and the record clearly establishes no evidence that would support a finding that the plaintiff had reason to believe there was a violation of the standard of care.
It is silent. He didn’t establish that in any affirmative testimony that I heard.
The defendant argues that the burden of proof was on the plaintiff to show that he neither discovered nor should have discovered and he failed to meet that burden. That may be true but what we have here is a situation where the defendant properly raised the Statute of Limitations in its first responsive pleadings and never did another thing.
Never motioned it up, never raised it in anything further that this Court could discover and never pursued their legal position on the Statute of Limitations.
They allowed the matter to proceed right into trial, and that makes it distinguishable from the case they relied upon saying that the issue was not waived.
[Defendant] led the plaintiff into preparing a case and proceeding on a case that they assumed would go to the jury on the issue of malpractice. Now, the purpose of the 116 accelerated judgment motion and the purpose of the Statute of Limitations is to have this matters [sic] disposed of timely without all of the costs relative to discovery and trial and that’s why we have motions for accelerated judgment.
Thus, because of the late bringing of that motion after the plaintiff had offered all of its proofs, this Court feels that the matter was not given the proper legal priorities such that it could have been submitted to the jury.
The Court believes that the undisputed facts did not establish that the plaintiff realized at an earlier time that the defendant had breached the standard of care and therefore it’s not a matter of law, it was not submitted to the jury.
Defense did not ask it to be submitted to the jury, the plaintiff did not ask it be submitted to the jury. Therefore, the Court feels that the jury’s verdict will stand that the issue was abandon [sic] by the defense and judgment shall enter in favor of the plaintiff as was demonstrated by the verdict of the jury.
There are difficulties in accepting this analysis. First, GCR 1963, 301.1, then in effect, required the trial court to hold a pretrial conference, unless waived in writing. Also using mandatory language, GCR 1963, 301.3 required the trial judge to prepare and file a pretrial summary, providing, among other things:
The judge shall prepare, file, and cause to be served upon the attorneys of record, at least 10 days in advance of trial, a summary of the results of the pretrial conference specifically covering each of the items herein stated. The summary of results controls the subsequent course of the action unless modified at or before trial to prevent manifest injustice. The court may provide by rule a pretrial calendar on which actions may be placed for consideration and may also by rule amplify or modify the pretrial procedure as herein provided in the furtherance of justice but not in conflict with these rules. No party shall be deprived of the right to present competent proof at the trial in support of any issues raised in the pleadings unless such issues have been expressly waived at the pretrial conference and such waiver is recorded in the said summary of results. [Emphasis added.]
However, attempting to obviate the necessity of holding a pretrial conference in every case, the Oakland Circuit Court promulgated its own Local Rule 7, which provided that GCR 1963, 301.1 through 301.7 would only be applicable in civil cases where ordered by the court. The Supreme Court approved the local court rules. In this case, the file does not indicate a pretrial conference was held, and no pretrial summary was filed. This was unfortunate because if a pretrial conference had been held, it would most certainly have dealt with the statute of limitations issue raised by the parties in their pleadings.
Thus, in the absence of a pretrial conference or summary, defendant hospital was not deprived of its right to offer evidence in support of the affirmative defense of the statute of limitations that had been raised in the pleadings. Second, while we believe that it would have been better practice for defendant hospital to praecipe for hearing a motion for accelerated judgment based on expiration of the period of limitations, we do not believe that failure to do so in advance of trial in a case where a jury was demanded would constitute a waiver or abandonment of the affirmative defense of the statute of limitations.
If defendant had praeciped for hearing a statute of limitations motion in advance of trial, GCR 1963, 116.3, quoted above, would have dictated the procedure to follow. In Wallisch v Fosnaugh, we held that, where a plaintiff has demanded a jury trial, accelerated judgment under GCR 1963, 116.1 (5) should not be granted if there are factual disputes regarding when discovery was made or reasonably should have been made. Since the trial judge apparently believed the statute of limitations issue depended upon a disputed fact, namely as to when plaintiff discovered or should have discovered the malpractice, she presumably would have had an alternative. Either she could have impaneled a jury for the sole purpose of hearing the statute of limitations issue or she could have waited until trial and then given that jury the statute of limitations issue.
In practice, very seldom, if ever, is a jury impaneled solely to hear and decide a statute of limitations issue. If the trial judge had followed the customary procedure under GCR 1963, 116.3, the statute of limitations issue would have been held for submission to the jury at trial. Of course, this is what defendant did, namely, to raise its motion during trial after completion of plaintiff’s proofs. Thus, we do not see that under the facts of this case where plaintiff demanded a jury trial it would have made any difference whether defendant had brought its statute of limitations motion on for hearing earlier. Under cases like Jackson v Vincent, plaintiff or defendant would have been entitled to a jury trial on the disputed fact upon which determination of the statute of limitations issue depended. Under the invariable procedure in that situation, the same jury which would have heard the case on the merits would have heard the statute of limitations issue._
In fact, it can be argued that one interpretation of GCR 1963, 116.1(5) and 116.3 required holding the question for the jury hearing the case on the merits. When, confronted by defendant’s motion, the trial judge elected to take defendant’s motion under advisement, rather than to decide it, she precluded both defendant hospital and plaintiff from obtaining a jury determination of the statute of limitations question. Under these circumstances, it was error to hold that defendant hospital had waived and abandoned the defense of the statute of limitations. Defendant hospital was entitled to a ruling on the merits of its motion based on the statute of limitations.
Consequently, we reverse the trial court’s finding that defendant hospital waived the affirmative defense of the statute of limitations- and remand this issue to the trial court for determination of the statute of limitations issue on its merits. In so doing, we are aware that there is now a split in the Court of Appeals on the question whether, under the new court rules of 1985, a statute of limitations question must be decided by a jury where plaintiff has demanded a jury trial or can be decided by the trial judge as a preliminary question. In Blana v Spezia we held that statute of limitations questions should be treated as preliminary questions to be decided by the trial judge after an appropriate evidentiary hearing with full findings of fact and conclusions of law. However, until the Supreme Court reconciles this conflict in our decisions, a trial judge has a choice either to submit the question to a jury for determination, or to treat it as a preliminary question and to decide it the same as any other preliminary motion. In the within case, this would mean that on remand the trial judge may impanel a jury and conduct a mini-trial culminating in a special verdict on the statute of limitations, issue, or may conduct a nonjury evidentiary hearing and make findings of fact and conclusions of law upon which to base a determination.
On appeal, defendant hospital also claims that the trial court committed error requiring reversal in changing its pretrial ruling in limine by refusing to permit defendant hospital to impeach Dr. Lawson with respect to his alleged interest, bias and prejudice in favor of plaintiff, as reflected in his settlement agreement with plaintiff. Originally, plaintiff sued defendant Dr. James Lawson and defendant hospital. Dr. Lawson is a plastic surgeon who, along with doctors with other specialties, was called in by defendant hospital to treat plaintiff who had been severely injured in an automobile accident. Dr. Lawson was particularly involved with plaintiff’s badly fractured lower jaw and teeth damage. Shortly before trial, plaintiff settled with Dr. Lawson for $200,000. In the written settlement agreement, in exchange for the $200,000 paid him by Dr. Lawson, plaintiff agreed to indemnify Lawson for any amount Lawson might be required to pay defendant hospital, including actual attorney fees and costs of litigation as a result of and arising out of plaintiff’s claims, and plaintiff covenanted not to sue Dr. Lawson for any further damages.
Apparently, prior to trial, defendant hospital made a motion to be permitted to examine Dr. Lawson regarding the amount and details of his settlement with plaintiff. According to counsel for defendant hospital, the trial judge may have led counsel for defendant hospital to believe she would permit him to do so. The extent or scope of the trial judge’s ruling is in dispute and, as it was a side-bar matter, is not set forth in the record. No questions were actually put to Lawson by counsel for defendant hospital regarding his settlement with plaintiff. The only reference to this subject in the trial record is the following exchange, which occurred after defendant hospital rested its case:
The Court: Sit down. Everybody be seated. Mr. Feringa [Counsel for defendant hospital] remembered something.
Mr. Feringa: Your Honor, I apologize to the Court. During my cross examination of Doctor Lawson I was relying on the motion in limine which we had presented regarding the settlement, the conditions of the settlement and the fact that Mr. Palenkas now has agreed to pay for Doctor Lawson’s attorneys fees as a result of the settlement and that Doctor Lawson irrespective of what this jury does would not be required to spend any more money.
The Court refused me the opportunity, the Court reversed herself [sic], and refused me the opportunity to cross examine Doctor Lawson on that.
The Court: Just as you relied on that, I always rely on attorneys representations when I make a ruling and it was your representation that it would be a [sic] significant import to bring that evidence out because it would be necessary to attack the credibility of Doctor Lawson. As it turned out Doctor Lawson’s testimony certainly was not designed to assist the Plaintiff, at least in this Court’s mind and Mr. Fieger quite properly brought that to the Court’s attention.
He has testified now very candidly somewhat expressing more candor than one sees on the witness stand and I didn’t think that it would be appropriate at that point. The prejudicial affect [sic] was there and the Court of Appeals has rules and I was willing to go out on a limb because I felt it would be important with regard to the interest, bias, or prejudice the witness may have. He didn’t demonstrate any so we were able to nip it in the bud because Mr. Fieger objected timely.
Mr. Feringa: Thank you, Your Honor.
Plaintiff says the understanding only applied if plaintiff called Dr. Lawson as a witness and not where, as here, defendant hospital called Dr. Lawson as a witness. Since defendant hospital neglected to cause a clear record of its motion and of the judge’s specific ruling to be made, we limit consideration on appeal to those things which seem clear. For example, it is clear that, pursuant to his settlement agreement with Dr. Lawson, plaintiff hired different counsel who appeared for Lawson after the settlement and plaintiff paid his attorney fees. Contrary to the trial judge’s indication, the testimony of Dr. Lawson was very detrimental to defendant hospital. Lawson claimed that defendant, William Beaumont Hospital-Troy, had no plastic surgeons available other than himself, the thrust of which testimony was to place the onus on the hospital for the crucial period when, while plaintiff was in the hospital, Lawson for four or five days neither was available to plaintiff nor had arranged cover by another plastic surgeon. Without Lawson’s testimony, plaintiff’s case against defendant hospital for separate negligence on the part of the hospital, other than vicarious negligence arising out of the agency relationship with Dr. Lawson, would have been substantially weaker. Also, it should be remembered that the jury was instructed that Dr. Lawson was an agent for defendant hospital, and that defendant hospital was bound by and responsible for whatever Dr. Lawson did or did not do. In short, we do not agree with the trial judge’s conclusion that Dr. Lawson’s testimony was not adverse and damaging to defen dant hospital. As a matter of fact, months later in ruling on defendant hospital’s motion for remittitur, the trial judge cast doubt on her earlier ruling regarding Dr. Lawson’s testimony when she said:
The Court believes that this jury was inflamed and was angry. Perhaps it was because the hospital really offered no other witnesses other than the attending doctor [Lawson]. The doctor [Lawson] was not on trial, but the jury was angry.
The jury, I believe in my opinion, listening to that doctor [Lawson] found him arrogant and conceited and listening to him was inflaming the jury.
However, to hold as we do that Lawson’s testimony was adverse to defendant hospital does not necessarily mean that to prohibit testimony regarding Lawson’s settlement with plaintiff was erroneous.
In the within case, the jury was instructed to answer special questions. This procedure and the form and content of the questions was agreed upon by all three attorneys. With respect to plaintiff’s claim against defendant hospital, the jury found (1) defendant hospital was negligent, (2) that negligence was a proximate cause of injury or damage to plaintiff, and (3) the total amount of plaintiff’s damages was $1,250,000. With respect to the claim of defendant hospital for indemnity from Dr. Lawson, the jury found (1) "Defendant, Dr. James Lawson, M.D.” was negligent, (2) Lawson’s negligence was a proximate cause of injury or damage to plaintiff, and (3) the negligence of defendant hospital was not "based completely and solely on its responsibility for the negligent conduct of its agent, James Lawson, J.D. [sic].”
In general, the permissible scope of examination on a collateral matter is left to the sound discretion of the trial judge and is not disturbed on appeal unless there is an abuse of that discretion. The starting point in deciding whether there is error is MRE 402, which is the bellwether of the Rules of Evidence, and MRE 408, which spells out the general rule regarding admissibility of settlement evidence, as follows:
Evidence of (1) furnishing or offering or promising to furnish, or (2) accepting or offering or promising to accept, a valuable consideration in compromising or attempting to compromise a claim which was disputed as to either validity or amount, is not admissible to prove liability for or invalidity of the claim or its amount. Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require the exclusion of any evidence otherwise discoverable merely because it is presented in the course of compromise negotiations. This rule also does not require exclusion when the evidence is offered for another purpose, such as proving bias or prejudice of a witness, negativing a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.
In Kueppers v Chrysler Corp, we said that where a plaintiff makes known his willingness to have the trial court adjust a verdict to give credit for amounts received in settlement, the fact of the settlement becomes immaterial and inadmissible in evidence. In the within case, plaintiff stipulated to reducing any judgment he might obtain against defendant hospital by the $200,000 he received in settlement from Dr. Lawson. Thus, this is not a case where there is a possibility of double recovery and, under the analysis of MRE 402 in Kueppers, the settlement details would not be admissible.
The question whether there were implicit promises on the part of Lawson in his settlement with plaintiff that necessarily give rise to an indication of bias toward the hospital presents a closer, more difficult issue. Insofar as in the case between plaintiff and defendant hospital, it made no difference whether defendant hospital was guilty of separate, independent negligence, any bias on the part of Lawson was irrelevant. But, insofar as plaintiff agreed in the settlement agreement to indemnify Lawson for any recovery defendant hospital might make against Lawson, Lawson’s bias would appear very relevant. However, in spite of that, since we have a record that does not show exactly what defendant hospital sought in its motion in limine, does not show exactly how the trial judge originally ruled and, most importantly, does not show the questions that defendant hospital intended to put to Lawson, we decline to find that the trial judge abused her discretion in denying defendant hospital’s belated effort to examine Dr. Lawson regarding his settlement with plaintiff.
Last, we give consideration to plaintiff’s cross-appeal from the trial judge’s grant of remittitur. In his cross-appeal, plaintiff contends that the trial court erred in granting defendant’s motion for remittitur and thereby reducing the jury verdict from $1,250,000 to $800,000. We agree. A trial court cannot substitute its judgment on damages for that of the jury unless a verdict has been secured by improper methods, prejudice or sympathy, or, alternatively, if the verdict is so clearly excessive as to shock the judicial conscience. As long as the amount awarded is within the range of the evidence and within the limits of what reasonable minds would deem just compensation for the injury sustained, the verdict should not be disturbed. A trial court’s decision to grant remittitur will be reviewed for an abuse of discretion.
In Pippen v Denison Division of Abex Corp, a panel of this Court noted that trial and appellate courts are reluctant to allow verdicts in personal injury cases to be disturbed since personal injury cases involve assigning a monetary value to a plaintiff’s pain and suffering which cannot be measured by an absolute standard. In the within case, the trial judge stated that she was remitting the verdict because:
It did shock the judicial conscious [sic]. The Court believes that this jury was inflamed and was angry. Perhaps it was because the hospital really offered no other witnesses other than the attending doctor. The doctor was not on trial, but the jury was angry.
The jury, I believe in my opinion, listening to that doctor found him arrogant and conceited and listening to him was inflaming the jury.
Our review of Dr. Lawson’s testimony does indicate that he was a factor in the jury’s verdict. However, we would not say that his testimony, the testimony of one witness only, so inflamed the jury as to make the verdict improper. The fact is, however, that Dr. Lawson was called as a witness by defendant hospital. Defendant hospital cannot call a witness (Dr. Lawson) under the adverse party statute (as happened here) and then com plain that he hurt their case. No such objection to his testimony was made by defendant hospital at the time he testified. Furthermore, we do not believe the size of this verdict is so excessive as to be outside of any reasonable range of the evidence.
The medical testimony presented was largely uncontroverted and demonstrated the painful and serious nature of plaintiffs injuries and the ensuing pain from the treatment rendered. As a result of Lawson’s malpractice, plaintiff suffered extreme pain, inconvenience and the frustration of undergoing three complex surgical procedures and attendant recovery periods. Following two of these surgical procedures, his jaw was wired shut for periods of six and eight weeks respectively. The record reveals that plaintiff continues to have, a slight facial deformity in that the left side of his face is flattened and his chin points abnormally to the right. In addition, he has facial scars from the surgery.
Plaintiff testified that he experiences chronic pain that is worsened by the weather and that has not been alleviated by exercise. He claims difficulty in chewing hard foods and in speaking. The oral surgeon testified that plaintiff has a permanent disability in the form of joint disease in his jaw and that accompanies this condition. He will also have some disability with his hip as a result of the bone graft. Further, since one of the surgical procedures required manipulation of two nerves in the jawbone, plaintiff has a permanent numbness in the lower jaw. Aside from the dental restoration plaintiff has already gone through, there was testimony that plaintiff will have to undergo further reconstructive treatment in the future at a cost of approximately $10,000 to $20,000. In addition, plaintiffs continuing functional disability with respect to the vertical components in his jaw may necessitate further reconstructive surgery. Aside from the physical and functional disability, the jury heard plaintiffs testimony and that of his mother and a psychologist who examined him indicating that he has experienced, and will continue to experience, severe pain and suffering as a result of the malpractice. For these reasons, we believe the jury verdict was within the range of the evidence and was not so excessive as to shock the judicial conscience. On the contrary, the damages awarded related more to plaintiffs injuries than to anger at Dr. Lawson. Consequently, we would be very reluctant to disturb this verdict merely because of its size and, therefore, regarding this issue, we reverse the order of remittitur and reinstate the jury verdict.
Affirmed in part, and reversed in part.
Specifically, the court said:
The Court: (Interposing): Mr. Fieger [Attorney for Plaintiff], you have already argued that. Let me just tell you, sir, that Plaintiffs pleadings don’t make the case. It is the time when you put on your proofs which makes the difference. They pled the statute of limitations and accelerated judgments are granted all the time in face of pleadings but this is rather unique in that he let you put on your best shot and you have done it. He has a cogent argument and it is very persuasive.
I am not going to rule on it right now. I want to review some applicable case law. We’re now moving on to the defense case.
Counsel for defendant hospital had one minor reservation to the jury instruction, which is not relevant to this discussion.
See GCR 1963, 301.8.
126 Mich App 418, 424; 336 NW2d 923 (1983).
In the author’s experience as a trial judge and trial attorney, never has a jury been specially impaneled to hear only a statute of limitations issue.
In its answer, defendant hospital alleged that it relied upon plaintiffs demand for a jury trial.
97 Mich App 568; 296 NW2d 104 (1980).
Leyson v Krause, 92 Mich App 759, 764-765; 285 NW2d 451 (1979), and Jackson, supra, represent one view, and Blana v Spezia, 155 Mich App 348; 399 NW2d 511 (1986), represents another view.
Blana, supra.
Reno v Heineman, 56 Mich App 509, 514; 224 NW2d 687 (1974).
108 Mich App 192, 202; 310 NW2d 327 (1981).
Kueppers, supra; also see Brewer v Payless Stations, Inc, 94 Mich App 281; 288 NW2d 352 (1979), aff'd 412 Mich 673 (1982); Silisky v Midland-Ross Corp, 97 Mich App 470; 296 NW2d 576 (1980).
Guzowski v Detroit Racing Ass’n, Inc, 130 Mich App 322, 327; 343 NW2d 536 (1983); Belin v Jax Car Wash No 5, Inc, 95 Mich App 415, 423-424; 291 NW2d 61 (1980).
Precopio v Detroit, 415 Mich 457, 465; 330 NW2d 802 (1982).
Argenta v Shahan, 135 Mich App 477; 354 NW2d 796 (1984), rev’d on other grounds 424 Mich 83 (1985).
66 Mich App 664, 674-676; 239 NW2d 704 (1976), lv den 399 Mich 823 (1977). | [
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Cynar, P.J.
In this medical malpractice suit, plaintiff appeals as of right from an order of the trial court granting summary disposition in favor of defendants Southwest Michigan Emergency Services, Inc., and Leila Hospital and Health Center. We reverse.
Tamara M. Latham, whose date of birth is June 14, 1968, was taken to the Leila Hospital emergency room by her mother, Letha E. Latham, on June 17, 1980, at approximately 2:30 p.m., after the child had been ill for several days. The emergency room physician examined, treated and prescribed medication for Tamara, before her release at 7:00 p.m. that same day.
On June 18, 1980, at about 2:00 a.m., Tamara was returned to the hospital because she had become disoriented, hysterical and comatose. At 5:30 a.m., Tamara was transferred to Bronson Methodist Hospital where a diagnosis of Reyes Syndrome was made. Due to a delay in diagnosis and treatment, Tamara apparently suffers from mental retardation.
As a result of the alleged misdiagnosis and improper treatment of Tamara, her mother, as next friend, sued the defendants. The defendants filed a motion for summary disposition arguing that since Tamara’s mother executed a valid arbitration agreement on June 17, 1980, the circuit court lacked subject-matter jurisdiction and that any claims should be submitted to arbitration. The trial court granted defendants’ motion and the instant appeal ensued.
The sole issue before this Court is whether MCL 600.5042; MSA 27A.5042, the Michigan Malpractice Arbitration Act (mmaa), applies to a parent who is offered an arbitration agreement on behalf of a minor child so as to require the offering of the option to arbitrate after completion of emergency care or treatment.
MCL 600.5042(1); MSA 27A.5042(1) states:
A person who receives health care in a hospital may execute an agreement to arbitrate a dispute, controversy, or issue arising out of health care or treatment rendered by the hospital. A person receiving emergency health care or treatment may be offered the option to arbitrate but shall be offered the option after the emergency care or treatment is completed. [Emphasis supplied.]
The emphasized language is in dispute. Plaintiffs maintain that, since the mother could bind the child to the arbitration agreement she signed on Tamara’s behalf, the above language should be extended to include a parent or guardian signing on behalf of the minor child.
Defendants assert that the disputed language is inapplicable because the mother was not the person receiving "emergency health care or treatment.” Hence, they argue, it is unnecessary for a hospital or medical facility to comply with the requirements of that particular section of the statute. We disagree.
The rules of statutory construction were concisely stated in Nicholas v Michigan State Employees Retirement Bd, 144 Mich App 70, 74; 372 NW2d 685 (1985):
(1) when a statute is unambiguous, further construction is to be avoided; (2) if an ambiguity exists, the intent of the Legislature must be given effect; (3) a construction which best accomplishes the statute’s purpose is favored; (4) statutes are to be interpreted as a whole and construed so as to give effect to each provision; (5) specific words in a statute are given their ordinary meaning unless a different interpretation is indicated; and (6) respectful consideration is to be given to the construction of a statute used by those charged with its application.
Recently, in McKinstry v Valley Obstetrics-Gynecology Clinic, PC, 428 Mich 167; 405 NW2d 88 (1987), the Supreme Court resolved the conflict regarding the burden of proof in establishing the validity or invalidity of an arbitration agreement signed pursuant to the mmaa. The Court held that the burden of demonstrating the existence of an arbitration agreement that conforms to the strict requirements of the statute rests with the party seeking to enforce the agreement. Once prima facie evidence of such an agreement has been shown, the statutory presumption of validity is made out, and the burden of going forward with evidence to rebut the presumption then shifts to the party seeking to avoid the agreement. Id., p 173.
In May v St Luke’s Hospital, 139 Mich App 452; 363 NW2d 6 (1984), the plaintiff was the administrator of the estate of the decedent, Kevin Mc-Keown, and he was ordered by the trial court to arbitrate his case. Plaintiff argued that the agreement was not executed in accordance with the mmaa because the decedent’s mother — who apparently executed the agreement — did not receive a copy of the information brochure, did not receive a copy of the agreement and was not provided with an explanation of the arbitration procedure.
This Court remanded for an evidentiary hearing to determine whether the agreement was properly executed in all respects. This Court also remanded for a finding of whether the agreement was presented to the decedent’s mother before emergency treatment was completed. The Court concluded that § 5042(1) would prohibit this.
We conclude, as a matter of law, that a "person receiving health care” and a "person receiving emergency health care” includes a parent or guardian signing on behalf of the minor child.
This conclusion is based on a reading of the statutory language and the holding in May which, if not expressly, impliedly indicated that § 5042(1) would be violated if a person, other than the one receiving treatment, who signs on behalf of the person receiving treatment, is asked to execute the agreement prior to the completion of medical treatment. This conclusion appears to be the most consistent reading of the statute because parents have the power under the mmaa to bind their minor children to arbitration agreements entered on behalf of the minor children. MCL 600.5046(2); MSA 27A.5046(2).
Therefore, we remand the case to the trial court for further proceedings.
Reversed and remanded. | [
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Per Curiam.
Plaintiffs appeal as of right, from the circuit court orders granting defendants’ motion to bar plaintiffs’ expert testimony and motion for summary disposition. Plaintiffs contend that the circuit court abused its discretion in barring plaintiffs’ expert witnesses’ testimony. We agree and vacate the orders and remand the case for further proceedings.
The essential facts are undisputed. Plaintiffs commenced this medical malpractice action in November, 1983, seeking damages for injuries sustained by their son, who was born with a bilateral cleft lip and complete cleft palate. Plaintiffs alleged that the injuries were caused by Delalutin, a drug prescribed by defendants for Denise Middleton during her pregnancy.
In January, 1984, defendants filed interrogatories asking plaintiffs, inter alia to provide information concerning their expert witnesses. In April, 1984, plaintiffs answered indicating that as of that date no expert had been retained.
Subsequently, trial, which was originally scheduled for November 13, 1984, was rescheduled for November 15, 1985, on plaintiffs’ motion for more discovery time.
On November 13, 1985, pursuant to a stipulated order to compel answers to interrogatories and make available experts for deposition before trial, plaintiffs identified the three expert witnesses, one from Detroit, one from Florida and one from California, who would testify on their behalf at trial. Trial was again rescheduled for January 17, 1986, pursuant to plaintiffs’ motion.
In December, 1985, counsel for the parties entered discussions relative to when defendants could depose plaintiffs’ experts. Both parties agree that defendant’s counsel gave plaintiffs’ counsel a series of alternate dates acceptable to defense counsel on which a deposition could be scheduled. Included in those dates was January 14, 1986. Not having heard from plaintiffs’ counsel by early January, 1986, defense counsel noticed the deposition of plaintiffs’ expert witness who resided in Detroit for January 8, 1986. Upon receipt of that notice, plaintiffs returned a letter indicating that this expert was unavailable on January 8, but would be available on January 14 and that plain tiffs’ counsel considered defendants’ notice amended to reflect this date. Defendant’s counsel, however, had another matter scheduled on that date and advised plaintiffs’ counsel that he would probably not be able to make it. On the afternoon of January 14 defendants’ counsel called plaintiffs’ counsel and informed him that he would not make the deposition.
On January 15, 1986, defendants’ motion to bar plaintiffs’ expert witness testimony was granted. Defendants subsequently moved for summary disposition on the basis that, without the expert testimony, plaintiffs would be unable to establish their cause of action at trial.
Although the trial court’s order and the transcript of the hearing to bar the expert witness testimony is silent with regard to the court rule under which the motion was brought, it appears from the record that the motion was brought under MCR 2.313(B)(2)(b), formerly GCR 1963, 313.2(2)(b). That rule provides:
(2) Sanctions by Court in Which Action Is Pending. If a party or an officer, director, or managing agent of a party, or a person designated under MCR 2.306(B)(5) or 2.307(A)(1) to testify on behalf of a party, fails to obey an order to provide or permit discovery, including an order entered under subrule (A) of this rule or under MCR 2.311, the court in which the action is pending may order such sanctions as are just, including, but not limited to the following:
(b) an order refusing to allow the disobedient party to support or oppose designated claims or defenses, or prohibiting the party from introducing designated matters into evidence.
Contrary to plaintiffs’ assertion, the motion was not brought under subrule (B)(2)(c), which provides the sanction of dismissal of the action or proceeding upon failure to obey a court order providing or permitting discovery. Rather, defendants were granted summary judgment because, as a result of the motion granted under subrule (B)(2)(b), plaintiff was prevented from supporting his claim with expert testimony. Therefore, presumably, no genuine issue of material fact existed as to whether defendants breached the applicable standard of care. See MCR 2.116(C)(10). In any event, we agree with plaintiffs’ claim that the order barring the expert witness testimony constituted an abuse of the trial court’s discretion and should be vacated. Hence the order granting summary disposition should also be vacated.
The trial court’s decision to impose discovery sanctions rests in the trial court’s discretion. Mac-Arthur Patton Christian Ass’n v Farm Bureau Ins Group, 403 Mich 474, 475, 477; 270 NW2d 101 (1978); Kurczewski v State Highway Comm, 112 Mich App 544, 549-550; 316 NW2d 484 (1982).
In Spalding v Spalding, 355 Mich 382, 384-385; 94 NW2d 810 (1959), the Supreme Court stated the standard for reviewing a claim of abuse of discretion:
The term discretion itself involves the idea of choice, of an exercise of the will, of a determination made between competing considerations. In order to have an "abuse” in reaching such determination, the result must be so palpably and grossly violative of fact and logic that it evidences not the exercise of will but perversity of will, not the exercise of judgment but defiance thereof, not the exercise of reason but rather of passion or bias.
We find that the trial court abused its discretion in the instant case. Although the dismissal of plaintiffs’ complaint was not granted under MCR 2.313, but rather was pursuant to a motion for summary disposition, the result of the order barring plaintiffs’ expert witness testimony is analogous to the situation presented in MacArthur Patton, supra, i.e., dismissal of the complaint. In such a situation, where barring plaintiffs’ expert witness testimony in effect results in barring plaintiffs from supporting their claim and dismissal of their action necessarily results, the discovery sanction should be exercised cautiously.
We find that the order entered in the instant case was too harsh a sanction for the circumstances. This is not a case, as in MacArthur Patton, where the failure to respond to the discovery request extended over a period of time. Nor is this a case where the order barring plaintiffs’ expert witness testimony was based on a showing of plaintiffs’ wilfulness. Although plaintiffs’ efforts in advancing the case for trial over the past three years have been less than stellar, defense counsel is not blameless. Defense counsel knew since November, 1985, that plaintiffs had settled on their expert witnesses. Yet the record is absent of any effort to depose plaintiffs’ experts until a week before the originally scheduled trial in November. Not until early January, 1986, did defense counsel become concerned enough to notice up the first deposition. In addition, defense counsel allowed an opportunity to depose plaintiffs’ expert from Detroit to pass even though the date, January 14, had been selected less than a month before by defense counsel. In view of these facts we conclude that the trial court abused its discretion in barring plaintiffs’ expert testimony. The trial court should have chosen less drastic measures to compel discovery. Cf. MacArthur Patton, supra. Such mea sures would include the imposition of costs on plaintiffs. See MCR 2.313.
The order barring plaintiffs’ expert witness testimony and the order entering summary disposition are vacated. The case is remanded to the circuit court for further proceedings. | [
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] |
E. M. Thomas, J.
On September 10, 1982, plaintiffs, Provincial House, Inc., (phi) and Living Centers, Inc., filed a first amended complaint for a declaratory judgment against defendant, Michigan Department of Social Services. Living Centers, Inc., is a subsidiary of phi and together they will be referred to as plaintiff. Plaintiff, which formerly owned a large number of nursing homes in Michigan, sought determination of issues with respect to reimbursement of its expenses in connection with its participation in the Medicaid program. A dispute has arisen between the two parties during the completion of the final accounting for plaintiffs participation in the Medicaid program.
Following a bench trial, the circuit court ruled that (1) defendant may not, based on plaintiffs sale of its facilities at a gain, recapture excess depreciation expense reimbursements from plaintiff, (2) plaintiff may not receive reimbursement through calculation of the "experience modification factor” which was in effect from July 1, 1979, until September 30, 1980, and provided for adjustment of reimbursement rates when cost projections and actual experience differed by at least 1.5 percent, and (3) plaintiff may not receive reimbursement for extraordinary expenses incurred in closing down its business.
Defendant appeals as of right from the court’s determination of the depreciation recapture issue. Plaintiff cross-appeals from the court’s determination of the remaining two issues. We affirm the circuit court’s decision._
RECAPTURE OF DEPRECIATION
Dss asserts that phi sold its entire business to Beverly Enterprises effective January 1, 1982, at a sales price in excess of the depreciated book value to the adjusted amount of $1,191,110.99. Dss contends that phi received Medicaid funds premised, in part, upon the reported cost of operation. One of the costs of operation reported by phi was depreciation of the nursing home facilities, thus, dss reasons that phi was overpaid Medicaid funds to the extent that it declared depreciation of facilities which have now been determined not to have depreciated in value but which actually appreciated in value. The circuit court ruled that phi had shown that dss’ recapture of excess depreciation was not a part of the state plan prior to January 1, 1982, therefore, dss could not assert such a claim against phi. We agree.
Medicaid is a program established under Title XIX of the Social Security Act of 1935, 42 USC 1396 et seq. The program provides matching funds to states to provide medical assistance for the indigent, including payment for nursing home care. In 1966, the State of Michigan elected to participate in the program, pursuant to MCL 400.105; MSA 16.490(15) of the social welfare act, MCL 400.1 et seq.; MSA 16.401 et seq. Title XIX required that the participating state submit a state plan to the Department of Health and Human Services for approval. The state plan must meet certain conditions set forth in 42 USC 1396a(a)(1) to (44). Defendant is the state agency charged with administering the Medicaid program. Since the implementation of the program, defendant has submitted and received approval of numerous state plans.
In order for a health care provider, such as phi, to receive Medicaid funding, it is required to enter into a provider agreement. This agreement provides:
All claims under the above programs shall be submitted on State approved invoices in accordance with applicable policies, rules and procedures established and published by the State, or contained in the State Plan approved by the U. S. Department of Health and Human Services.
It is the interpretation of this provider agreement between phi and dss for the years preceding December 31, 1981, which is in issue in this case.
To interpret the provider agreement and state plan we must examine how nursing care facilities have been reimbursed in Michigan. The method of reimbursement has varied since the beginning of the Medicaid program. Until September 1, 1973, nursing homes were reimbursed at a flat daily rate. From 1973 until July 1, 1978, facilities in Michigan participating in the Medicaid program were reimbursed allowable costs plus a profit factor up to a ceiling set annually by the Legislature in dss appropriation acts. This methodology was referred to as the "retrospective reimbursement” system. This methodology was governed in part by the following documents: (1) the dss binder entitled "Guidelines, Michigan Nursing Home Reimbursement Rates, Medicaid/Intermediate Care,” (2) applicable state plans, and (3) dss appropriations acts. The retrospective reimbursement methodology was intended to reimburse nursing homes in a manner reasonably related to their actual allowable costs from and after 1976.
Effective July 1, 1978, Michigan nursing care facilities of the type operated by plaintiff were paid prospectively using per patient per day rates based upon (1) historical costs both for physical plant (known as the plant cost component) and routine services, as well as (2) nonplant costs (referred to as the variable cost component). This methodology is referred to as the “prospective reimbursement” system. Reimbursement under this system is fixed at the beginning of the reimbursement period and is not subject to retroactive change except in cases of provider fraud or withholding of required information. Importantly, there is no cost settlement at the end of the fiscal year under this system. If a nursing home’s allowable costs are below the prospectively established rate, it keeps the difference. If its allowable costs exceed that rate, it is not reimbursed for those excess costs.
In order to permit recapture of depreciation, dss must show that it either specifically contracted with phi or placed phi on notice that a precondition to receipt of Medicaid funds was the ability of dss to recoup such funds at a later time based on erroneous depreciation of facilities. However, trial testimony showed that under either the retrospective or prospective systems recapture of depreciation was not part of the state plan and hence not part of the provider agreement or any applicable rule, policy, or procedure established by dss during the applicable time period (prior to January 1, 1982).
The individuals who designed the retrospective reimbursement procedure testified that they were unaware that recapture of depreciation was part of the state plan; furthermore, the issue never arose during the program’s design. Further, the cost reporting forms designed for use did not contain a provision for a calculation of depreciation expense reimbursement.
Dennis Madalinski, director of the long-term care rate setting section of the Bureau of Medicaid Fiscal Review, which is part of dss, acknowledged that there were no policy bulletins before December 21, 1981, stating that depreciation recapture was part of the Michigan Medicaid system and that a bulletin issued to providers in November, 1982, contained the first reference to recapture upon sale of a facility. However, Madalinski argued that the state plan effective January 1, 1976, did state that nursing homes shall adopt accounting procedures and uniform cost reporting in accordance with the principles of cost reporting approved by the Auditor General. He believed that this was a reference to the November 12, 1973, Seidman and Seidman letter which was part of the "blue book” distributed to providers. This letter, written by two designers of the retrospective reimbursement program, recommended that the state follow the Department of Health, Education and Welfare (now hhs) publication hir-4, which contained the federal regulations governing reimbursement for Medicare services. Publication hir-4 allowed recapture of depreciation under the Medicare plan. See also 42 CFR 405.415(f). Madalinski viewed defendant’s mailing of the blue book containing the Seidman and Seidman letter and publication hir-4 as giving providers notice that defendant intended to recapture depreciation expenses following the sale of a facility at a gain.
We do not agree. Dss attempts to incorporate the federal depreciation reimbursement scheme into the state plan via references in the Seidman letter. However, Madalinski’s contentions have limited impact when we view the entire Seidman letter and the testimony of two accountants who helped design the retrospective reimbursement system. The Seidman letter referred to the Medicare reimbursement plan when it stated that the allowance for depreciation, contrary to publication hir-4, was restricted to the straight line method of depreciation with a useful life, in compliance with irs guidelines. Both accountants who designed the program testified that this exception was intended to supersede the entire depreciation provisions of publication hir-4, including recapture of depreciation. Additionally, one accountant testified that the recapture concept did not lend itself to the straight line depreciation method adopted. The Medicare cost accounting forms included recapture of depreciation expenses, while the Medicaid forms were silent on this issue. Dss witnesses testified that recapture was accomplished during and after this period following a number of nursing home sales. However, such testimony did not cite specific examples and thus lacked foundation and credibility.
We find that this testimony, along with our reading of the provider agreements and state plans during the 1973 to 1978 period, supports the trial court’s determination that recapture of depreciation was not part of the state plan during this time period.
As for the prospective reimbursement period, 1978 to 1982, we believe that the testimony of Noble P. Kheder, deputy director, then chief deputy director, of dss from 1978 to 1982, establishes that recapture of depreciation expense reimbursement was not part of the state plan until the dss issued the "Michigan Department of Social Services Long-Term Care Prospective Reimbursement Plan Manual” on February 15, 1982 (distributed December, 1982). The 1979 state plan does give reference to 42 CFR 405.415(f), which allows for recapture of depreciation in the Medicare program. However, mention is made of this regulation in reference to the straight line depreciation method used in Michigan.
Section iv of the 1984 state plan contained the following and was effective October 1, 1984:
In all cases of sale or resale, the seller must notify the state agency at least 90 days in advance of purchase. The sale will not be recognized for reimbursement purposes until 90 days after notification. Provisions of 42 CFR 405.415(f) will be retrospectively satisfied at this time. Any exception must be approved by the state agency.
It is clear from this that recapture of depreciation expense reimbursement is now part of the state plan. However, we agree with the circuit court that prior to the February 15, 1982, dss directive the state plans did not permit recapture of excess depreciation expense reimbursements.
We find that the proofs in this case established that phi had no notice that recapture of excess depreciation expense reimbursements was part of the state plan during the applicable time period. The trial court’s ruling is not clearly erroneous and is supported by sufficient evidence. MCR 2.613(C).
EXPERIENCE MODIFICATION FACTOR
An experience modification factor was included in the state plan effective July 1, 1978. The factor was to be used when there was a difference of over 1.5 percent between the nursing home cost index (nhci) and the industry’s actual costs. The nhci is a composite index used to predict the rate of inflation of nursing home costs. The experience modification factor was in effect until September 30, 1980, when the Legislature set the factor at zero because of the cost implications to defendant. Defendant never did calculate what the experience modification factor should have been during the period in which it was in effect.
Phi contends that dss should have implemented the experience factor and adjusted phi’s reimbursement rates for the period commencing July 1, 1979, through September 30, 1980. The circuit court ruled that as a matter of law the experience modification factor could not be calculated with any meaning from January 1, 1978, to September 30, 1980, and any claim for recovery based on such calculation was rendered moot by the passage of 1980 PA 315, § 93(3), which set the factor at zero. Further, the court concluded that even if the experience modification factor was calculable and failure to calculate is a basis for recovery, phi did not pursue an administrative appeal of the prospective reimbursement procedure and thus had abandoned the issue.
We affirm the circuit court’s ruling based on the latter. Generally, where an administrative grievance procedure is provided, exhaustion of that remedy prior to review by the courts is necessary except where excused. Doster v Estes, 126 Mich App 497, 514; 337 NW2d 549 (1983). The doctrine of exhaustion of administrative remedies serves several policies: (1) an untimely resort to the courts may result in delay and disruption of an otherwise cohesive administrative system; (2) judicial review is best made on a full factual record developed before the agency; (3) resolution of the issues may require the accumulated technical competence of the agency or may have been entrusted by the Legislature to the agency’s discretion; and (4) a successful agency settlement of the dispute may render a judicial resolution unnecessary. Id., pp 514-515.
We believe that these factors support a finding that plaintiff has waived review of the issue by failing to exhaust administrative remedies. An appeal to the administrative body may have placed pressure on dss to secure audited cost reports so that the experience modification factor could be calculated, thus rendering plaintiffs request moot. Additionally, an administrative appeal would have provided a more complete factual record for a clearer resolution of the issue. For these reasons, we decline to address phi’s contention that dss should be required to perform the actual experience modification factor calculation and adjust phi’s reimbursement rates for the period commencing July 1, 1979, through September 30, 1980.
REIMBURSEMENT FOR EXTRAORDINARY EXPENSES
Finally, phi contends that should this Court allow defendant to recapture depreciation expense reimbursements, then phi should be allowed reimbursement for extraordinary expenses incurred as a result of the sale of its facilities.
Since we find that dss had no authority prior to 1982 to recapture reimbursement for depreciation expenses, phi’s argument must fail. Further, there is no statutory authority for such a reimbursement and neither the state plan nor the provider agreement authorizes such.
CONCLUSION
For the foregoing reasons, we affirm the circuit court’s December 5, 1986, judgment stating that (1) defendant may not, based on plaintiffs sale of its facilities at a gain, recapture excess depreciation expense reimbursements from plaintiff, (2) plaintiff may not receive reimbursement through calculation of the experience modification factor which was in effect from July 1, 1979, until September 30, 1980, and (3) plaintiff may not receive reimbursement for extraordinary expenses incurred in closing down its business. No costs, neither party prevailing in full.
Affirmed.
We make no ruling today as to when recapture of excess depreciation became part of the state plan. We only rule that during the applicable time period (prior to phi’s sale of its nursing homes to Beverly Enterprises effective January 1, 1982) recapture was not part of the state plan and therefore not part of the applicable provider agreements. | [
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H. Hood, J.
Defendant Caro Community Hospital appeals by leave granted from three orders of the Saginaw Circuit Court in this medical malpractice action. These orders are the March 5, 1985, order setting aside a dismissal of the case, the December 20, 1985, order denying Caro’s motion for summary disposition, and the December 20, 1985, order compelling Caro to produce certain documents. Defendant St. Mary’s Hospital cross-appeals from the order setting aside the dismissal.
On June 20, 1981, at 4:00 a.m. an automobile driven by Robert A. McNeil struck a tree, seriously injuring McNeil. McNeil was taken to Caro Community Hospital’s emergency room. Later that morning, he was transferred to St. Mary’s Hospital for further treatment, but he was pronounced dead on arrival. On June 17, 1983, plaintiff, Betty Taylor McNeil, the personal representative of the estate of Robert A. McNeil, filed suit against Caro and St. Mary, alleging various acts of negligence in failing to take full life-support measures for McNeil.
Defendants moved for summary judgment pursuant to GCR 1963, 117.2(1), now MCR 2.116(C)(8), arguing that the complaint failed to state a claim upon which relief could be granted because it did not allege malpractice with sufficient specificity. At the August 8, 1983, hearing on the motion, the parties stipulated that an amended complaint setting forth a more definite statement of the claims against defendants would be filed within thirty days. On December 5, 1983, an amended complaint was filed which contained more detail as to the alleged malpractice of defendants. Defendants again filed motions for summary judgment on the same grounds, and on March 16, 1984, the circuit court granted the summary judgment motions. However, the order provided that plaintiff could file a second amended complaint within thirty days.
On May 10, 1984, the court entered an order dismissing plaintiffs case with prejudice based on plaintiffs failure to file a second amended complaint and on plaintiffs communication, through her counsel, of her consent to the entry of a dismissal with prejudice.
On January 31, 1985, plaintiff moved, through new counsel, to set aside the order of dismissal and permit the filing of her second amended complaint. The motion was made pursuant to GCR 1963, 528.3(6), now MCR 2.612(C)(1)(f). In an affidavit accompanying the motion, plaintiff stated that her former attorney, Barry L. Moon, had not discussed the merits of the case with her, and that Moon did not inform her that the case had been dismissed until some time after May 10, 1984. Plaintiff stated that she did not authorize Moon to dismiss the lawsuit. The court granted plaintiffs motion. The court stated that the affidavit was at that point undisputed, and that plaintiff had met her burden of proving extraordinary circumstances warranting relief from the May 10, 1984, order dismissing her case.
After the court’s oral ruling, defendants asserted that they had not disputed the contents of plaintiffs affidavit because they had not received it before the hearing. The court then ruled that defendants would be permitted to depose Moon and move for a rehearing based upon testimony elicited at the deposition. On March 5, 1985, the court entered its order granting plaintiffs motion to set aside the dismissal and ordering that plaintiff would be permitted to file a second amended complaint.
Following Moon’s deposition, defendants moved for rehearing on plaintiff’s motion to set aside the dismissal. On September 10, 1985, the court issued its opinion on the motion for rehearing. The court concluded that plaintiff’s assertion that she did not give Moon authority to dismiss the action was not specifically contradicted by Moon’s deposition. The court affirmed its earlier order setting aside the dismissal.
Plaintiff thereafter filed her second amended complaint, and on May 20, 1985, filed a third amended complaint naming Dr. Fay Quines as a defendant.
On November 6, 1985, defendant Caro filed a motion for summary disposition pursuant to MCR 2.116(C)(8), formerly GCR 1963, 117.2(1), alleging that plaintiff had failed to state a claim upon which relief could be granted because her complaint failed to make allegations in avoidance of governmental immunity. The court denied this motion.
On appeal, defendants first claim that the court erred in finding that plaintiff satisfied her burden that reinstatement of the case was proper under GCR 1963, 528.3(6), now MCR 2.612(C)(1)(f). This court rule states:
.3 On motion and upon terms as are just, the court may relieve a party or the legal representative of a party from a final judgment, order, or proceeding for the following reasons:
* * *
(6) Any other reason justifying relief from the operation of the judgment.
The decision of the trial court on a motion brought under GCR 1963, 528.3 will not be disturbed on appeal absent a clear showing of an abuse of discretion. Bye v Ferguson, 138 Mich App 196; 360 NW2d 175 (1984). Three requirements must be fulfilled before relief may be granted under subsection (6): (1) The reason for setting aside the judgment must not fall under subrules (1) through (5); (2) the substantial rights of the opposing party must not be detrimentally affected if the judgment is set aside; and (3) extraordinary circumstances must exist which mandate setting aside the judgment in order to achieve justice. Lark v The Detroit Edison Co, 99 Mich App 280, 284; 297 NW2d 653 (1980), lv den 410 Mich 906 (1981). In general, relief is to be granted only where the judgment was obtained by the improper conduct of the party in whose favor it was rendered. Marshall v Marshall, 135 Mich App 702, 712; 355 NW2d 661 (1984).
In the instant case, the order of dismissal was not obtained by improper conduct of the opposing parties; rather, plaintiff’s own attorney was at fault. The trial court relied upon Coates v Drake, 131 Mich App 687; 346 NW2d 858 (1984), in granting plaintiff relief from the order dismissing her case. In Coates, this Court reversed the trial court’s refusal to reinstate the plaintiffs’ case where the plaintiffs’ attorney settled the plaintiffs’ case without the plaintiffs’ express or implied consent and forged the plaintiffs’ signatures upon releases and the settlement checks. Coates, supra, pp 689-690, 697. The plaintiffs’ attorney then appropriated the money to his own use and signed an order dismissing the case with prejudice. Id., p 690. The plaintiffs did not find out about the dismissal until approximately nine months later when they called their attorney. Id.
Although we agree that extraordinary circumstances existed in Coates, we do not feel that extraordinary circumstances are present in the instant case to warrant relief. In his deposition, Moon testified that he discussed plaintiff’s case with her over the phone at various times, and was under the impression that she agreed that the case should be dismissed. In Coates, this Court noted that the defendants never disputed below that the plaintiffs did not authorize settlement. Coates, supra, p 690. In the instant case, defendants did dispute the allegation that plaintiff did not consent to the dismissal, and Moon’s deposition confirmed this. This case is not as egregious as Coates, where the attorney forged his clients’ signatures on their settlement checks and appropriated the money to his own use.
Although plaintiff in the instant case may conceivably have had a claim for malpractice against Moon for failure to file an amended complaint within the time allowed by the court, we do not believe the facts warrant reinstatement of plaintiff’s case under MCR 2.612(C)(1)(f). Thus, we feel the trial court abused its discretion in finding extraordinary circumstances to set aside its judgment dismissing plaintiff’s case.
Because we reverse the court’s order of rein statement, we need only briefly discuss defendant’s remaining issues.
Defendant Caro argues that the court erred in denying its motion for summary disposition on the basis of governmental immunity. The question is whether Ross v Consumers Power Co (On Rehearing), 420 Mich 567; 363 NW2d 641 (1984), applies to this case. In Parker v Highland Park, 404 Mich 183; 273 NW2d 413 (1978), the Court held that public general hospitals were not immune from tort liability since the day-to-day operation of such hospitals was not a governmental function. Parker, supra, pp 191-194. However, in Ross, supra, the Court attempted to clarify the parameters of governmental immunity. In particular, the Court redefined the term "governmental function” as being an activity which is expressly or impliedly mandated or authorized by constitution, statute, or other law. Ross, supra, p 620. In Hyde v University of Michigan Bd of Regents, 426 Mich 223; 393 NW2d 847 (1986), the Court held that to the extent that the diagnosis, treatment, and care of patients at a public general hospital are activities which are expressly or impliedly mandated or authorized by constitution, statute or other law, the hospital is entitled to immunity. In discussing the retroactivity of Ross, the Hyde Court stated:
We hold that the rules articulated in Ross apply to all cases commenced after January 22, 1985, the date our opinion was issued, and to those cases pending either in trial or appellate courts on January 22, 1985, in which a governmental immunity issue was properly raised and preserved. [Hyde, supra, p 230.]
The instant case was dismissed on May 10, 1984, and not reinstated until March 5, 1985. However, an amended complaint relates back to the filing date of the original complaint. MCR 2.118(D). Thus, the second amended complaint in the instant case relates back to the date of the original complaint, June 17, 1983, and the case must therefore be considered to have been pending in the trial court on January 22, 1985. The question becomes whether a governmental immunity issue was properly raised and preserved. If so, Ross applies and governmental immunity may shield Caro; if not Parker applies and Caro is not immune.
Defendant Caro did not raise the issue of governmental immunity until November 6, 1985, when it moved for summary disposition based on governmental immunity. Therefore, we must determine whether governmental immunity, or rather, the lack of it, was raised by plaintiff. We believe that plaintiffs pleadings did not raise the nonexistence of governmental immunity. The complaint did not allege that defendants operated a public general hospital, nor did it allege that defendant was a profit-making institution. Cf. Hyde, supra, p 236, n 7. The trial court therefore did not err in ruling that defendant Caro was not entitled to summary disposition on the basis of governmental immunity.
Caro also claims that the court erred in ordering the production of a statement by Bonnie Youngert, a nurse at Caro. We find that the court did not abuse its discretion in ordering defendant to produce this statement. Because the statement was taken at a time close to the alleged malpractice when Youngert’s memory was fresh, we believe plaintiffs burden of proving substantial need and inability to obtain the substantial equivalent by other means has been fulfilled.
The decision of the circuit court granting plaintiffs motion to set aside the dismissal is reversed.
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] |
K. B. Glaser, Jr., J.
Defendant pled guilty but mentally ill to assault with intent to murder, MCL 750.83; MSA 28.278, and to possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2). He was sentenced to a prison term of 96 months to 240 months. The sentencing guidelines provided for a minimum sentencing range of forty-eight to ninety-six months. Defendant appeals only from his sentence on a twofold basis. He claims that the sentence is so excessive that it should shock the conscience of this Court and that it is so disparate that it violates Michigan’s constitutional prohibition against cruel or unusual pun ishment under Const 1963, art 1, § 16. We disagree and affirm.
Defendant drove up beside Police Detective Bradley while driving down a street in Saginaw, pointed a pistol at Detective Bradley and attempted to fire at the detective without success. The detective dropped back behind defendant’s vehicle and called for backup assistance. At Fifth and Sixth Streets in Saginaw, defendant stopped his vehicle, got out, and again pointed his revolver at Detective Bradley. The detective drew his gun and ordered defendant to drop his gun, but defendant failed to do so. Defendant shot at the detective and jumped back into his car. On Fourth Street, defendant again got out of his vehicle, as did the detective. Detective Bradley again ordered defendant to drop his weapon. Instead, defendant began yelling at the detective and stated that the detective did not dare shoot him. The defendant proceeded down the street and fired a second shot at the detective. Defendant fired a third shot after he climbed onto a porch of a residence. Detective Bradley was firing back at defendant at this point in an attempt to keep him from entering the residence. Defendant did enter the residence, but surrendered to officers a few minutes later. Defendant was taken to the hospital for treatment of gunshot wounds to his neck and leg.
Defendant had a history of mental illness and was first evaluated as not being competent to stand trial. Later, defendant was certified as competent to stand trial and as not meeting the criteria for legal insanity at the time of the alleged offense. Defendant had two prior convictions of attempted carrying a concealed weapon in an automobile, one in 1979 and one in 1982. He also had a probation violation on the first of those charges. His plea of guilty but mentally ill re- suited from a plea bargain in which a count of carrying a pistol in an automobile and a supplement as a habitual offender, third, was dismissed. At the time of the plea defendant claimed to have no memory of the facts of this case.
Defendant first argues that his sentence is excessive. Defendant correctly asserts that the Supreme Court in People v Coles, 417 Mich 523, 549-550; 339 NW2d 440 (1983), required the sentencing court to articulate on the record the reasons for sentencing in order to facilitate appellate review and permitted the appellate court to remand for resentencing if the trial court abused its discretion by imposing a sentence which shocks the conscience of the appellate court. A sentence within the guidelines is presumptively neither excessively severe nor unfairly disparate. People v Broden, 428 Mich 343; 408 NW2d 789 (1987). However, while a sentence within the guidelines is sufficient to satisfy Coles, supra, it does not necessarily preclude the possibility that, in a particular case, the sentence might still shock the conscience of the Court and warrant reversal. Broden, supra, p 354, n 18.
While defendant correctly states the law, the facts are heavily against him. A crime of this nature with its great danger to human life, coupled with defendant’s prior record, easily justifies the penalty imposed by the court. The sentence does not shock our conscience.
The second issue raised by defendant is that, even if the sentence satisfied the requirements of Coles, supra, there is such a disparity between the crime and the punishment that it is void as cruel or unusual punishment under Const 1963, art 1, § 16. We disagree.
The dominant test for cruel or unusual punishment is that the punishment is in excess of any that should be suitable for the crime. People v Lorentzen, 387 Mich 167, 176; 194 NW2d 827 (1972); Coles, supra, p 530. To be cruel or unusual by reason of disparity it must be so disproportionate to the offense as to "shock the moral sense of the public.” Lorentzen, supra, p 176. It must not be so disparate that it "shocks the conscience.” Lorentzen, supra, p 181. Coles "expanded” the scope of appellate review of sentencing from that in Lorentzen and other cases involving disparate sentences and the constitutional concept of cruel or unusual punishment. Coles, supra, p 548. Accordingly, our Supreme Court has held that the Coles doctrine is more restrictive than the cruel or unusual punishment doctrine where disparate sentencing is concerned. Therefore, we hold that any sentence which satisfies the requirements of Coles cannot be challenged as cruel or unusual punishment under Const 1963, art 1, § 16 by reason of disparity between the crime and the penalty.
Affirmed.
Cynar, J., concurs in the result only. | [
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Per Curiam.
Defendant was convicted by a jury of carrying a concealed weapon, MCL 750.227; MSA 28.424, possession of a controlled substance (cocaine), MCL 333.7214, 333.7403; MSA 14.15(7214), 14.15(7403) and possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2). On September 17, 1986, defendant was sentenced to two concurrent prison terms of from three months to five years on the carrying a concealed weapon (ccw) conviction and the controlled substance conviction and a mandatory consecutive term of two years for the felony-firearm conviction. Defendant appeals as of right. We affirm.
On February 11, 1986, at approximately 11:30 a.m., officers Donald Gundy and Gary Koesters of the Oak Park Police Department received a radio dispatch that a possible breaking and entering was in progress at 21900 Harding. A neighbor called the police and reported that four black teenagers were attempting to get into the front door at the Harding address.
When the officers arrived, they saw two black males and one black female on the front porch. On the porch, there were a couple of plastic garbage-type bags, two briefcases and a purse. As the officers stopped their car, the three turned away from the door and walked off the porch towards the officers. They met the officers on the driveway. The bags, briefcases and purse were left on the porch.
The officers asked the three for identification, explained that a possible breaking and entering had been reported at the home and questioned them concerning their presence there. All three indicated that they did not have any identification. When questioned about their presence at the home, the three stated that they were trying to awaken Mr. Scoefield because he was supposed to give them a ride to a funeral in Detroit. They did not know Scoefield’s first name, age or telephone number. They could not tell the officers exactly where the funeral was or whose funeral it was.
Gundy then asked'defendant to get her identification from her purse. Gundy and defendant walked towards the porch. Koesters remained in the driveway with the two males. Defendant first looked through the briefcase and told Gundy that she did not have any identification there. Gundy then directed defendant to look through her purse. Defendant bent down, unzipped her purse while standing in front of Gundy, in what he characterized as an attempt to block his view, removed her wallet and quickly zipped her purse. Defendant opened her wallet and gave Gundy her driver’s license. She then began walking off the porch, leaving the bags, briefcases and her purse. Gundy remained on the porch and, while defendant was walking, Gundy asked her if all of the stuff on the porch belonged to her. She replied that some of it was hers.
In the meantime, Officer Koesters conducted a pat-down search of one of the males and discovered bullets in his pocket. Koesters told Gundy that he found the bullets. Gundy thereafter picked up one of the plastic bags, squeezed the bottom and felt a gun inside. Gundy opened the bag and found a loaded .25 caliber semiautomatic gun among women’s clothing. Gundy related this information to Koesters and all three individuals were arrested and handcuffed.
After they were arrested, Gundy searched defendant’s purse and found a .38 caliber revolver, a vial and a brown paper bag, both of which contained cocaine. No contraband was found in the other bags. All three were arrested for the semiautomatic found in the bag, although no effort was made by the officers to ascertain its owner. The officers did ask if any one of the three had a concealed weapons permit. The bullets found fit the .38 caliber revolver.
The officers further testified that they were not sure if an attempted break-in had occurred. However, they saw no burglary tools or marks of forcible entry on the doors, windows or the back of the home. The only fact inconsistent with the story told by the three individuals was the items on the porch. Although a calculator was found in one of the briefcases, there were no household items on the porch indicating a burglary had taken place.
Defendant testified that she and her friends did not attempt to break into the home. They were there only because their friend was going to give them a ride to a funeral. She claimed that the revolver and contraband did not belong to her, she did not know that they were in her purse, and that she never gave anyone permission to place the items in the bag or purse.
On the day of trial, defendant moved to dismiss the felony-firearm charge claiming that she could not be charged with that offense as well as the ccw charge since that constituted double jeopardy. She also filed a motion to suppress the .38 caliber revolver and the contraband alleging that these were seized pursuant to a search after an illegal arrest. Both motions were denied.
On appeal, defendant challenges the denial of both of her motions by the trial court. Defendant argues that the elements of a charge for felony-firearm are identical to those for carrying a concealed weapon. Because the elements are identical, charging defendant with both of these offenses violates her right against double jeopardy.
In People v Sturgis, 427 Mich 392, 405-406; 397 NW2d 783 (1986), our Supreme Court held that the double jeopardy clauses of both the United States and Michigan Constitutions did not prohibit both a concealed weapon conviction and a felony-firearm conviction in the same trial stemming from a single criminal episode when the felony-firearm conviction is based on a distinct felony. The Court rejected the contention that it was bound to determine "whether each [statute] requires proof of a fact which the other does not.” Id., p 409. Instead, the Court concluded that its obligation was to determine what punishment the Legislature had authorized under the statutes. Id., p 404.
Further, the Court noted:
The conduct made punishable under the felony-firearm statute, is not the mere possession of a firearm. Rather, it is possession of the firearm during the commission of or attempt to commit a felony that triggers a felony-firearm conviction. The conduct made punishable by the concealed weapon statute is likewise not the possession of a firearm, it is the carrying of a weapon, concealed. Each statute is directed at a distinct object which the Legislature seeks to achieve through the imposition of criminal penalties. Where the act giving rise to the predicate felony is distinct from the act giving rise to the concealed weapon felony, both convictions are authorized by the Legislature. [Emphasis in original. 427 Mich 409-410.]
In this case, we find no violation of the double jeopardy clause when defendant was charged and convicted of both carrying a concealed weapon and felony-firearm. The felony-firearm offense was based on the distinct felony of possession of cocaine. Consequently, per Sturgis, supra, the double jeopardy clause did not prohibit convictions for both carrying a concealed weapon and felony-firearm.
In her second claim on appeal, defendant alleges that the cocaine and gun found in her purse following her arrest should have been suppressed because both the search which revealed the bullets and the search which revealed the gun in the plastic bag were illegal. Based on these illegal searches, defendant was arrested, culminating in the search of her purse.
A court’s ruling on a motion to suppress evidence will not be set aside unless clearly erroneous. A ruling is clearly erroneous when the reviewing court is firmly convinced that a mistake has been made. People v Daniels, 160 Mich App 614, 617; 408 NW2d 398 (1987). At the outset, we must determine whether defendant has "standing” to challenge the pat-down search of her male friend which uncovered the bullets and, thereafter, led to the search of the plastic bag. In People v Smith, 420 Mich 1, 17; 360 NW2d 841 (1984), our Supreme Court stated that constitutional protections are generally personal. They cannot be asserted vicariously, but rather only "at the instance of one whose own protection was infringed by the search and seizure.” Id., quoting Simmons v United States, 390 US 377, 389; 88 S Ct 967; 19 L Ed 2d 1247 (1968). In Smith, our Supreme Court rejected the "automatic standing rule” and adopted the "reasonable expectation of privacy” test as the one to be utilized in determining whether a defendant has standing to assert the constitutional protection against unreasonable search and seizure. 420 Mich 26. In making this determination the court must decide whether the defendant had an expectation of privacy in the object of the search and seizure and whether that expectation is one that society is prepared to recognize as reasonable. The court should consider the totality of the circumstances. Id., p 28.
In this case, based on the nature of these facts defendant does not have standing to challenge the pat-down search of her male friend. We believe that she had no reasonable expectation of privacy in the pat-down search of her male friend.
However, even if we review the pat-down search, we conclude that it was proper under the two-pronged test enunciated in Terry v Ohio, 392 US 1; 88 S Ct 1868; 20 L Ed 2d 889 (1968). Terry requires: (1) a reasonable conclusion that criminal activity may be afoot; and (2) a reasonable conclusion that the person with whom the officer is dealing may be armed and dangerous. In deciding the reasonableness of these conclusions, due con sideration must be given, not to the officer’s unparticularized suspicion or hunch, but to specific reasonable inferences which the officer is entitled to draw from the facts in light of his or her experience. Id., p 27. The police officer must be "able to point to particular facts from which he reasonably inferred that the individual was armed and dangerous.” Sibron v New York, 392 US 40, 64; 88 S Ct 1889; 20 L Ed 2d 917 (1968). In our case, Officer Koester’s frisk was reasonable under the circumstances. He patted down the male for weapons because of the suspicious activity at the house. The three individuals could not reasonably explain their presence at the home. Furthermore, they could not produce identification. The officer conducted a pat-down search for safety measures. We are not convinced that the trial court’s denial of the motion to suppress was clearly erroneous.
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Per Curiam.
Defendant appeals as of right from his convictions of assault with intent to do great bodily harm less than murder, MCL 750.84; MSA 28.279, possession of a short-barreled shotgun, MCL 750.224b; MSA 28.421(2), and possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2). Defendant pled guilty to being a second-felony offender, MCL 769.10; MSA 28.1082. Six issues are raised on appeal, none of which merits reversal of defendant’s convictions.
The charges against defendant arose out of the shooting of Daniel Ruff. The shooting took place at the house where defendant was living with several other people. Ruff was apparently angry because his girlfriend had visited defendant previously. As Ruff stood at the bottom of a stairway, defendant stood on the landing with a short-barreled shotgun and fired at Ruff.
Defendant testified that on the day of the incident he moved the gun from the first floor of the house to his bedroom closet. Defendant did not consider the gun to be his, but he did not want it laying around unattended. Defendant said that on other occasions he found the gun downstairs and put it upstairs.
The trial court ruled that Ruff was incompetent to testify because of an organic brain disorder associated with the shooting. Ruff was in a wheelchair at the time of trial due to a suicide attempt and a fall from a substantial height that caused further injuries. After noting that there was noth ing grotesque or unusual about Ruff’s appearance, the trial court allowed a witness to point Ruff out to the jury at trial.
During closing argument, defense counsel acknowledged that defendant was guilty of being in possession of a short-barreled shotgun but maintained that defendant was innocent of the assault charge because he acted in self defense. The prosecutor argued in closing that defendant lied about being in fear for his life because he was afraid of being convicted. Although defendant was charged with assault with intent to murder, the jury found him guilty of the lesser-included offense of assault with intent to do great bodily harm less than murder. Defendant was also found guilty of possession of a short-barreled shotgun and possession of a firearm during the commission of a felony.
Defendant’s first argument is that the trial court erred in failing sua sponte to instruct the jury on his theories of innocent possession and possession by necessity. There is a conflict in this Court regarding whether the trial court must sua sponte instruct the jury regarding defendant’s theory of the case. However, a jury instruction regarding defendant’s theory of the case should be given only when there is evidence to support it. People v Rone (On Second Remand), 109 Mich App 702, 713; 311 NW2d 835 (1981), lv den 414 Mich 873 (1982); People v Stapf, 155 Mich App 491, 497; 400 NW2d 656 (1986). Even if the trial court was obligated sua sponte to instruct the jury on defendant’s theories, it was not warranted by the evidence in this case.
To support a jury instruction on the innocent possession defense, the evidence must show momentary or brief possession of a weapon resulting from the disarming of a wrongful possessor accompanied by the intent of delivering the weapon to the police at the earliest possible time. People v Coffey, 153 Mich App 311; 395 NW2d 250 (1986), lv den 426 Mich 858 (1986). The defense of necessity requires a present, imminent and impending threat of death or serious bodily harm. A threat of future injury is insufficient to support a necessity defense. People v Hubbard, 115 Mich App 73; 320 NW2d 294 (1982), lv den 417 Mich 910 (1983).
In the present case, defendant said that he put the short-barreled shotgun in the closet, as he had done on prior occasions, to prevent it from falling into anyone else’s hands. There was no indication that defendant had any intent to turn the shotgun over to the police, as is required for the innocent possession defense. Coffey, supra. In addition, the evidence showed that defendant acted under the threat of future harm and not under a threat of present, imminent and impending danger, as is required for a defense of necessity. Hubbard, supra. Therefore, instructions regarding the defenses of innocent possession and possession by necessity were not warranted.
Defendant’s second argument is that he was denied effective assistance of counsel by his attorney’s admission in closing argument that defendant possessed a short-barreled shotgun. If an ineffective-assistance-of-counsel claim depends on facts not in the record, then defendant should make a motion for new trial at which testimony to support defendant’s claim may be taken. People v Ginther, 390 Mich 436; 212 NW2d 922 (1973). In the present case, there was no Ginther hearing. Therefore, defendant’s ineffective-assistance-of-counsel claim is to be evaluated on the basis of the trial transcript only.
It is well established that arguing that defendant is guilty of an offense is not necessarily ineffective assistance of counsel under People v Garcia, 398 Mich 250; 247 NW2d 547 (1976), reh den 399 Mich 1041 (1977). In People v Savoie, 419 Mich 118; 349 NW2d 139 (1984), defense counsel argued that defendant shot a police officer, but was too intoxicated at the time to form the necessary intent for first-degree murder. In People v Wise, 134 Mich App 82; 351 NW2d 255 (1984), lv den 422 Mich 852 (1985), defense counsel argued that defendant was guilty of conspiracy and breaking and entering but was innocent of other charges. In both cases, it was held that there was no ineffective assistance of counsel. Where the evidence obviously points to defendant’s guilt, it can be better tactically to admit to the guilt and assert a defense or admit to guilt on some charges but maintain innocence on others. Such a trial tactic may actually improve defendant’s credibility and will not be second-guessed. Wise, supra, p 98.
In the present case, it is reasonable to conclude from the record before us that defense counsel employed the accepted trial strategy of admitting guilt to a lesser offense. Such a trial strategy is not second-guessed. Savoie, supra; Wise, supra. Therefore, defendant was not denied effective assistance of counsel under Garcia.
Defendant’s third argument is that his convictions of possession of a short-barreled shotgun and possession of a firearm during the commission of a felony violate his right to be free of double jeop ardy. Defendant acknowledges that the possession offense was not used as the underlying felony for the felony-firearm offense. However, defendant argues that the concurrence of the two convictions nevertheless violates double jeopardy. People v Bonner, 116 Mich App 41; 321 NW2d 835 (1982), lv den 417 Mich 919 (1983), lends support to defendant’s argument. The defendant in Bonner was convicted of the same three offenses of which defendant in the instant case was convicted. As in the instant case, the possession offense in Bonner was not used as the underlying felony for the felony-firearm offense. However, this Court held that double jeopardy was violated because the possession offense and the felony-firearm offense were both supported by proof of the use of a shotgun.
We decline to follow Bonner because we believe that our Supreme Court’s recent opinion in People v Sturgis, 427 Mich 392; 397 NW2d 783 (1986), has modified the double jeopardy analysis used in Bonner. The Bonner panel used a "factual” double jeopardy analysis. Under factual double jeopardy, multiple convictions are impermissible when the facts of a transaction do "double duty” in supplying proof of elements of distinct offenses. However, the Sturgis Court said that "factual” double jeopardy could not limit the power of the Legislature to authorize multiple punishment. The intent of the Legislature to authorize multiple punishment is the sole inquiry for purposes of double jeopardy analysis when multiple convictions occur after a single prosecution. Sturgis, supra; People v Robideau, 419 Mich 458; 355 NW2d 592 (1984).
In Sturgis, our Supreme Court gave three factors to be used in determining whether the Legislature intended to authorize multiple punishments. First, the language of the statutes should be considered. Second, if the statutes are directed at two distinctly different evils, that is an indication that the Legislature intended multiple punishments. Third, the test in Blockburger v United States, 284 US 299; 52 S Ct 180; 76 L Ed 306 (1932), may be applied, but it is not dispositive. Under the Block-burger test, multiple convictions are permissible if each offense requires proof of at least one element that the other offense does not require. The Sturgis Court applied these three factors to the defendant’s convictions of carrying a concealed weapon and felony-firearm. The Court concluded that the Legislature intended to authorize multiple punishments for these offenses so long as the underlying felony for felony-firearm was an act separate and apart from carrying a concealed weapon. In Sturgis, defendant’s third conviction of felonious assault was sufficient to serve as the underlying felony for the felony-firearm conviction.
In the present case, defendant’s conviction of assault with intent to do great bodily harm less than murder is an act separate and apart from possession of a short-barreled shotgun. The assault conviction is therefore sufficient to support defendant’s conviction of felony-firearm. Therefore, if the Legislature intended to authorize multiple convictions for felony-firearm and possession of a short-barreled shotgun, then defendant’s right to be free of double jeopardy has not been violated.
After applying the three factors in Sturgis, we conclude that the Legislature intended to authorize multiple convictions for felony-firearm and possession of a short-barreled shotgun. The statute prohibiting the possession of a short-barreled shotgun was enacted two years after the felony-firearm statute. However, the possession offense in the present case is analogous to the possession offense in Sturgis. We agree with the Sturgis Court that the Legislature’s intent was to preclude a possession offense from serving as the underlying felony for felony-firearm. However, the language of the statutes does not suggest that possession of a firearm and felony-firearm convictions cannot occur simultaneously so long as a different offense is used as the underlying felony for felony-firearm. Therefore, the language of the statutes suggests a legislative intent to authorize multiple punishments.
The Sturgis Court also noted that the carrying-a-concealed-weapon and felony-firearm statutes were directed at two distinctly different evils. Like carrying a concealed weapon, possession of a short-barreled shotgun is a strict liability offense, the purpose of which is to discourage the possession of short-barreled shotguns. As the Court noted in Sturgis, the felony-firearm statute is aimed at discouraging the use of a weapon during the course of a felony. Therefore, two distinctly different social harms are involved, which is a further indication of legislative intent to impose multiple punishments.
Under the Blockburger test, each of defendant’s convictions requires proof of an element that the other convictions do not require. While the Block-burger test is not conclusive, the Sturgis Court said that it may be applied as a test of legislative intent. Since all three of the Sturgis factors indicate that the Legislature intended to authorize multiple convictions in the present case, we conclude that defendant’s right to be free of double jeopardy was not violated.
Defendant’s fourth argument is that manifest injustice was caused by the prosecutor’s remark regarding defendant’s motivation for lying. When no objection to remarks is made, appellate review is foreclosed unless failure to consider the issue would result in a miscarriage of justice. People v Page, 122 Mich App 80; 329 NW2d 541 (1982). The prosecutor may argue that defendant is not worthy of belief if the argument is based on facts and evidence of the case. People v Evans, 128 Mich App 311; 340 NW2d 291 (1983). However, the prosecutor may not burden defendant’s constitutional right to be present at trial by arguing that defendant would not have appeared for trial if he were innocent. Such a hypothetical remark was disapproved of in People v Buckey, 424 Mich 1; 378 NW2d 432 (1985). However, the actual remark in Buckey, that defendant had an opportunity to fabricate his testimony because he heard the other witnesses testify, was not improper because it was tied to the facts and evidence of the case.
In the present case, the prosecutor argued in part as follows:
Again, it is our position that the story that the defendant has told you about his fear is a fabrication. That it’s a fabrication that he has concocted for the purpose of extraditing himself from this situation that he’s in. He’s in a position of being convicted of a crime and that is the motivation for this fabrication.
The remark in the present case no more burdened defendant’s right to testify than the actual remark in Buckey burdened defendant’s right to be present at trial. Moreover, as in Buckey, the remark in the present case was linked to the facts and eyidence of the case. Since no objection was made, our review is limited to whether there was a miscarriage of justice. We find no miscarriage of justice in the present case.
Defendant’s fifth argument is that the trial court erred in allowing Ruff to be pointed out to the jury. The decision to admit arguably prejudicial evidence is not error requiring reversal unless it represents an abuse of discretion. People v Peery, 119 Mich App 207; 326 NW2d 451 (1982), lv den 417 Mich 1018 (1983). The trial court noted that there was nothing "inappropriate, grotesque, particularly unusual about his (RufFs) appearance.” Furthermore, the court instructed the jurors that RufFs confinement to a wheelchair had nothing to do with the shooting. Since we can find no prejudice to defendant as a result of the jury’s viewing Ruff, we cannot say that the trial court abused its discretion in allowing Ruff to be pointed out to the jury.
Defendant’s sixth argument regarding resentencing will not be addressed because none of defendant’s convictions requires reversal.
Defendant’s convictions are affirmed.
In People v Cheatham, 135 Mich App 620; 354 NW2d 282 (1984), this Court determined that the trial court was not obligated sua sponte to give any instruction setting forth either party’s theory. The Cheatham panel noted that a contrary rule was stated in People v Hearn, 100 Mich App 749; 300 NW2d 396 (1980); People v Gayton, 81 Mich App 390; 265 NW2d 344 (1978); People v Stanley Jones, 69 Mich App 459; 245 NW2d 91 (1976), lv den 401 Mich 831 (1977). The panels in those cases held that the trial court must sua sponte instruct the jury on a party’s theory. The view expressed in Cheatham is consistent with MCR 2.516(B)(3), which requires that a party request am instruction as to the theory of his or her case before one must be given. | [
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C. W. Simon, Jr., J.
Plaintiff Robert Viele appeals by leave granted from a decision of the Workers’ Compensation Appeal Board dismissing his claim for disability benefits against defendants Great Lakes Steel and Southwest Marine, Inc., after finding that the doctrine of res judicata barred plaintiff’s claim. Southwest Marine cross-appeals seeking a remand to the wcab if its decision is reversed. We reverse and remand.
On December 12, 1983, plaintiff, in propria persona, filed a petition in the Workers’ Disability Compensation Bureau seeking compensation benefits for a left-hand disability. D.c.m.a. was the named employer; Great Lakes Steel’s premises in the City of Ecorse was the named place of injury. The basis of the petition was an injury sustained by plaintiff on November 1, 1983, while employed by d.c.m.a. to remove a crane from the premises of Great Lakes Steel. An amended petition, filed in January 1984, added Great Lakes Steel as a principal, also known as a "statutory employer,” under § 171 of the Workers’ Disability Compensation Act, MCL 418.101 et seq.; MSA 17.237(101) et seq. Plaintiff, now represented by counsel, added Great Lakes Steel as a general contractor, having allegedly subcontracted the crane work to D.C.M.A.
A second amended petition, filed June 1, 1984, with the bureau, added Fishbach & Natkin (and its carrier Travelers Insurance Company) and Southwest Marine, Inc. as statutory employers under § 171. For reasons unclear from the record, how ever, the proceedings on plaintiffs original petition against d.c.m.a. and the amended petitions adding the alleged statutory employers were not consolidated. While a pretrial hearing on the amended petitions was scheduled for July 18, 1984, an evidentiary hearing on plaintiffs original petition was held five days earlier on July 13, 1984. Plaintiff does not dispute that d.c.m.a. paid some compensation benefits to him prior to the evidentiary hearing.
D.c.m.a. did not appear at the evidentiary hearing, and the hearing referee found that plaintiff was totally disabled as a result of an injury arising out of and during the course of his employment with d.c.m.a. The hearing referee’s decision, dated August 16, 1984, was on a preprinted form, requiring only that the hearing referee fill in the blanks as to "defendant(s)” liability. The decision in this case ordered "defendant(s)” to pay plaintiff $330 per week from November 2, 1983, to July 13, 1984, and until further order of the bureau. The "defendants)” listed in the caption of the decision were d.c.m.a. and the alleged statutory employers. The decision indicated that it was mailed to "all parties” on August 27, 1984. Southwest Marine concedes that it received a copy of the decision.
Subsequently, the hearing referee issued a corrected decision, dated September 21, 1984, which was identical to the original decision except for the "defendant(s)” listed in the caption. All defendants were deleted except for d.c.m.a. The corrected decision indicated that it was mailed to "all parties” on October 1, 1984.
It appears from the record that d.c.m.a. became the subject of a Chapter 11 bankruptcy proceeding in the United States Bankruptcy Court during November, 1984.
The evidentiary hearing on plaintiff’s second amended petition in the bureau was held the next month on December 17, 1984, before the same hearing referee as in the earlier hearing. Plaintiff was present, as were defendants Great Lakes Steel and Fishbach & Natkin. Defendants d.c.m.a. and Southwest Marine, both California corporations, did not appear. Despite defendants’ claim that the hearing was barred under the doctrine of res judicata and plaintiffs offer of proofs on his disability, the hearing referee limited the hearing to the issue of which defendant, if any, was liable for plaintiffs compensation payments as the statutory employer due to d.c.m.a.’s lack of workers’ compensation coverage. No evidence was presented by plaintiff as to why Fishbach & Natkin was a statutory employer. There was, however, evidence that Great Lakes Steel sold the crane to the TEM Corporation which, in turn, sold the crane to Southwest Marine. Southwest Marine then contracted with d.c.m.a. to remove it from the premises of Great Lakes Steel.
In a decision dated February 13, 1985, the hearing referee found that Southwest Marine was the statutory employer and, as such, liable for the prior award rendered in favor of plaintiff. Plaintiff appealed to the wcab, claiming that Great Lakes Steel was also a statutory employer. Southwest Marine specially appeared to file an appeal to the wcab, raising various procedural and jurisdictional issues as well as a claim that the hearing referee’s decision was barred under the doctrine of res judicata.
The wcab ruled in favor of defendants, holding first that the hearing referee lacked jurisdiction to issue the corrected decision mailed on October 1, 1984, then holding that res judicata barred the December 17, 1984, evidentiary hearing and the decision emanating from that hearing. Thus, the only party held liable to plaintiff for compensation benefits was the defunct d.c.m.a.
On appeal, plaintiff and the alleged statutory employers raise various issues from a workers’ compensation proceeding which should have been, but was not, a summary procedure and process, MCL 418.853; MSA 17.237(853), designed to deliver "sustaining benefits to a disabled employee as soon as possible after an injury occurs.” McAvoy v H B Sherman Co, 401 Mich 419, 437; 258 NW2d 414 (1977). Our review, of course, is limited. Findings of fact made by the wcab are conclusive and, absent a showing of fraud, may not be set aside if supported by record evidence. Const 1963, art 6, § 28; MCL 418.861; MSA 17.237(861). However, the wcab’s decision may be reversed if it operated within the wrong legal framework or based its decision upon erroneous legal reasoning. Flynn v General Motors Corp, 162 Mich App 511, 514; 413 NW2d 444 (1987).
Plaintiff argues that the wcab erred in ruling that the hearing referee lacked jurisdiction to correct its original decision mailed on August 27, 1984. We agree. A referee or the wcab may correct a mistake in its original order, but may not grant a rehearing to review facts establishing liability. See McLean v Eaton Mfg Co, 286 Mich 285, 294; 282 NW 150 (1938); Hunt v Genesee Foundry Pattern & Engineering Co, 353 Mich 205, 208; 91 NW2d 286 (1958); Dean v Great Lakes Casting Co, 78 Mich App 664; 261 NW2d 34 (1977).
Here, the original decision was issued when MCL 418.851; MSA 17.237(851) allowed fifteen days for a party to file a claim of review from a decision of the hearing referee, unless the wcab granted further time for "sufficient cause shown.” Thus, the wcab correctly found that the original decision became final prior to the hearing referee’s issuing the corrected decision. What prompted the hearing referee to issue the corrected decision is not contained in the record. It is, however, clear that the corrected decision was consistent with the wcab’s own finding that Great Lakes Steel, Southwest Marine and Fishbach & Natkin, although listed as defendants in the original decision, were not parties to that proceeding.
Given this procedural background, we conclude that the wcab erroneously ruled that the hearing referee lacked jurisdiction to correct the original decision. To the contrary, because the alleged statutory employers were not parties to the July 13, 1984, proceeding, it appears that the hearing referee lacked authority to issue any award against them as a result of that proceeding. Even in an administrative proceeding, such as here, a party is entitled to adequate notice and an opportunity to be heard. Simonen v City of Negaunee, 289 Mich 267; 286 NW 610 (1939).
The corrected decision was procedural in nature, merely correcting the caption to reflect the actual parties to the proceeding. The correction was of particular importance in this case given the preprinted standard language in the decision requiring "defendant(s)” to pay benefits to plaintiff. The wcab applied erroneous legal reasoning in concluding that the corrected decision was null and void. Accordingly, we reverse the wcab’s decision and hold that the corrected decision was valid.
Plaintiff next claims that the wcab erred in ruling that the doctrine of res judicata barred the December 17, 1984, evidentiary hearing and the decision emanating from that hearing as to Southwest Marine’s liability. We agree.
Whether the doctrine of res judicata applies to a particular proceeding necessarily depends on the party seeking to invoke the doctrine and the reason for invoking it. The broad rule of res judicata applies to workers’ compensation cases. Gose v Monroe Equipment Co, 409 Mich 147; 294 NW2d 165 (1980). When used defensively, a broad application of the doctrine bars not only those claims raised in the prior action but "bars as well those claims arising out of the same transaction which plaintiff could have brought, but did not.” Id., p 160.
Here, the claim decided as a result of the July 13, 1984, evidentiary hearing was plaintiff’s entitlement to compensation benefits from his direct employer, d.c.m.a., as a result of injuries sustained on November 1, 1983. To the extent that the decision emanating from that hearing was favorable to d.c.m.a., i.e., the hearing referee denied plaintiff’s claim for nursing care benefits, it seems clear that d.c.m.a. could invoke the doctrine to bar a relitigation of that claim, as well as any other claim which plaintiff could have raised exercising reasonable diligence, but did not. See Socialist Workers Party v Secretary of State, 412 Mich 571, 584; 317 NW2d 1 (1982).
At issue in this appeal, however, is whether the alleged statutory employers can stand in d.c.m.a.’s shoes so as to invoke the doctrine of res judicata defensively to bar plaintiff’s claim against them under § 171 of the wdca. Except in special cases, the doctrine of res judicata can be invoked by the parties to the prior action, as well as by their privies. Socialist Workers Party, supra, pp 583-584. While there is no general prevailing definition of privity, it has been described as including a person so identified in interest with another that he or she represents the same legal right. 46 Am Jur 2d, Judgments, § 532, p 683. Examples include the relationship of principal and agent, master and servant, or indemnitor and indemnitee. Darin & Armstrong v Ben Agree Co, 88 Mich App 128, 134; 276 NW2d 869 (1979), lv den 406 Mich 1007 (1979); 2 Restatement of Judgments, 2d, § 51, pp 47-52.
Under § 171 of the wdca, the liability of the statutory employer (principal) stems from its contractual relationship with the direct employer of the disabled person. In addition, the statutory employer is entitled to indemnification from the direct employer, who remains primarily obligated for the award. MCL 418.171(2); MSA 17.237(171)(2).
Based on these statutory requirements, we conclude that the statutory employer is in privity with the direct employer and may properly invoke the doctrine of res judicata defensively to bar the relitigation of claims which could have been raised in the prior action between the disabled person and the direct employer, but were not. We emphasize, however, that even under the broad application of the doctrine, res judicata is limited to claims which could have been raised in the earlier action, but were not. Gose, supra; 2 Restatement of Judgments, 2d, § 51(1)(a), p 48.
Here, the claim which the alleged statutory employers sought to bar was plaintiffs claim against. them under § 171. This is not a claim which plaintiff could have raised in his prior action against d.c.m.a. Thus, while the alleged statutory employers may invoke the doctrine of res judicata to bar the relitigation of plaintiffs claim for disability benefits to the extent that d.c.m.a. was exonerated from liability, they cannot invoke the doctrine to bar a hearing on the issue of their own liability as statutory employers. We, therefore, conclude that the wcab applied erroneous legal reasoning in ruling that the December 17, 1984, hearing, and the decision emanating from that hearing, was barred under the doctrine of res judicata.
Having concluded that the wcab erred in both of its rulings, we remand to the wcab for further proceedings consistent with this opinion and for consideration of the other issues raised, but not considered by the wcab, in reviewing plaintiff’s and Southwest Marine’s appeals from the hearing referee’s decision dated February 13, 1985. To the extent pertinent to our remand, we shall also briefly address the other relief sought by plaintiff in this appeal.
With regard to plaintiffs request that we affirm the hearing referee’s decision dated February 13, 1985, we find no merit. The hearing referee expressly limited the evidentiary hearing underlying that decision to the issue of which defendant, if any, was the statutory employer. The issue of whether plaintiff was disabled was not relitigated. It follows that the hearing referee’s decision was based on correct legal reasoning only if plaintiff could invoke the doctrine of res judicata offensively against the alleged statutory employers to the extent that plaintiff received a favorable rul ing on this issue in his prior action against d.c.m.a. A prerequisite to a party’s ability to invoke the doctrine of res judicata in a subsequent proceeding is that the party must have given adequate notice of the prior proceeding to the persons who are to be bound by the adjudication. 2 Restatement of Judgments, 2d, § 83(2)(a), p 266. Because adequate notice of the July 13, 1984, hearing was not given to the alleged statutory employers in this case, plaintiff cannot invoke the doctrine of res judicata against them. We, therefore, find no grounds for affirming the February 13, 1985, decision holding Southwest Marine liable for the award rendered in favor of plaintiff.
With regard to plaintiff’s request that we rule that Great Lakes Steel is a principal as used in § 171 of the wdca, plaintiff may raise this issue on remand. In passing, we note that plaintiff sets forth no record evidence of any relationship between Great Lakes Steel and d.c.m.a. which would bring Great Lakes Steel within the ambit of § 171.
Finally, plaintiff’s claim that Southwest Marine or Great Lakes Steel should pay seventy percent of the compensation benefits awarded by the hearing referee pending the outcome of all appeals pursuant to MCL 418.862;MSA 17.237(862) has not been preserved for our review, since plaintiff failed to support his position with supporting citations. Wojciechowski v General Motors Corp, 151 Mich App 399, 405; 390 NW2d 727 (1986). In any event, we find no merit in plaintiffs claim, particularly in view of the procedural deficiencies in the proceedings below. See McAvoy, supra, p 439.
Reversed and remanded for further proceedings consistent with this opinion. We further set a time limit of sixty days for compliance with this opinion. Jurisdiction is not retained.
As amended by 1985 PA 103, the statute provides that parties may stipulate within thirty days to modify or correct errors in the decision issued. The wcab’s ability to extend the time for filing a claim for review continues in MCL 418.851a; MSA 27.237(851a).
Plaintiff, of course, is only entitled to one award of compensation benefits for his disability under the wdca. Whether plaintiff proceeds against his direct employer or the statutory employer, if any, has been viewed as being at the option of the disabled employee. Woody v American Tank Co, 49 Mich App 217; 211 NW2d 666 (1973), lv den 391 Mich 766 (1974). The general rule is that a judgment against one person liable for a loss does not terminate a claim that the injured party may have against another person who might be liable therefor. 2 Restatement of Judgments, 2d, § 49, p 34. Thus, subject to any defenses of the statutory employer or any procedural requirement of joinder in the bureau, a disabled person should be able to proceed against the direct and statutory employer.
Since the deficiencies in this case involve procedural matters, it also follows that the general rule that a workers’ compensation case cannot be reopened to review the facts establishing liability, Dean, supra, pp 666-667, does not apply. We recognize that our decision leaves plaintiff unable to invoke the doctrine of res judicata offensively, while allowing the alleged statutory employers to invoke the doctrine defensively to bar a relitigation of claims to the extend that d.c.m.a. was exonerated from liability. This result, however, is justified by the special relationship of the direct and statutory employer. A mutuality of estoppel is not required under the facts of this case. Darin & Armstrong, supra; DePolo v Greig, 338 Mich 703; 62 NW2d 441 (1954).
We express no opinion on whether the hearing referee could have entered a default decision against Southwest Marine on the issue of whether plaintiff was disabled for its failure to appear at the December 17, 1984, hearing. | [
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] |
M. J. KELLY,
J. In this medical malpractice suit, plaintiff Brenda Kincaid appeals by right the trial court’s order dismissing her suit against defendants Robert J. Cardwell, M.D., and his practice, St. Clair Cardiovascular Surgeons, EL.C., on the grounds that her suit was untimely. On appeal, we conclude that Kincaid failed to rebut the evidence that her claims were untimely. For that reason, we affirm.
I. BASIC FACTS
On March 17, 2008, Kincaid dropped a piece of lumber while working and injured her left foot. She went to the hospital, but x-rays did not reveal any fractures. She then saw Anca Rusu-Lenghel, M.D., for pain in her foot on April 7, 2008, and was referred to a podiatrist, Laura LaMar, D.EM.
Kincaid saw LaMar on April 23, 2008, with complaints of “numbness, burning, and pain” in her left foot since the original injury. Kincaid’s foot had some discoloration and blisters at the time. LaMar referred Kincaid to Vernon Dencklau, D.O., but Kincaid ended up seeing one of Dencklau’s partners, Cardwell.
Kincaid saw Cardwell for the first time on April 25, 2008. Cardwell examined Kincaid’s foot and leg and noted that her “left great toe is discolored, tender, and has some edema.” He wrote that her “two smallest toes of the left [foot] have darkened areas, which are moderately firm.” Cardwell diagnosed Kincaid as having “traumatic foot injury, which has had poor healing likely secondary to compromised blood flow to her left lower extremity.” Kincaid had a lower extremity Doppler study on the same visit, and the study was “consistent with potentially severe arterial occlusive disease of the left lower extremity . . . .” Cardwell also ordered a magnetic resonance angiogram (MRA) on Kincaid’s aorta and lower extremities.
Kincaid had the MRA on April 28, 2008. The MRA revealed some occlusion in Kincaid’s “left anterior tibial artery” and some narrowing of the “proximal posterior tibial arteries bilaterally,” but did not otherwise reveal significant “flow limiting stenosis” in the “lower extremity runoff.”
Cardwell examined Kincaid again on May 7, 2008. He noted a “persistent discoloration of her left great toe and two smallest toes.” He also discussed the MRA results with Kincaid and stated that there were mild signs of arterial disease in Kincaid’s “left posterior tibial” artery and “moderate to possibly severe” signs of disease in the “anterior tibial artery.” However, he noted that there was still good blood flow to her foot at the time. He instructed her to quit smoking and to return in two weeks.
Kincaid returned to Cardwell on June 6, 2008, with reports of severe pain. Cardwell performed a second Doppler study, which showed mild “diminished [blood] flow to [Kincaid’s] left ankle area” and that her “anterior tibial artery [was] occluded on the left.” He prescribed Keflex and Percocet and asked Kincaid to return for a follow-up.
Cardwell saw Kincaid again on June 16, 2008. He noted that she had “worsening discomfort and discoloration of her left fourth and fifth toes” and stated that it might be necessary to consider amputation because “there is nothing to revascularize” the foot.
Kincaid next saw Cardwell on July 9, 2008. At that time, Cardwell observed that Kincaid had gangrene in her great and fourth toes. He then referred her to Sadiq Hussain, M.D., for consideration of a left fourth toe amputation. Dencklau, who worked with Hussain, saw Kincaid on July 17, 2008, and determined that she had no bypassable vessels with which to revascularize her foot. As such, he recommended amputation. Dencklau amputated Kincaid’s left leg below the knee on July 21, 2008.
Kincaid sued LaMar; LaMar’s practice, Hodor and Frascone D.EM., EC.; Cardwell; and Cardwell’s practice, St. Clair Cardiovascular Surgeons, EL.C., on November 20, 2010, for malpractice. In her complaint, Kincaid alleged that for “several months leading up to the amputation,” defendants breached the applicable standards of care by failing to timely evaluate and treat Kincaid’s conditions, failing to refer her to other physicians, failing to warn about the risks, failing to perform appropriate tests, failing to follow up, failing to notify Kincaid’s other physicians that they “were not competent or qualified to treat” Kincaid, and failing to otherwise act reasonably.
Kincaid filed an amended complaint with substantially the same allegations in March 2011. However, she only named Cardwell and St. Clair Cardiovascular as defendants. The circuit court clerk entered an order in July 2011 dismissing Kincaid’s claims against Lamar and Hodor and Frascone for failure to serve them.
Kincaid died from lung cancer on October 23, 2011.
On January 3, 2012, Cardwell and St. Clair Cardiovascular moved for summary disposition under MCR 2.116(C)(7). Relying on Kincaid’s original notice of intent to sue, which Kincaid had sent on April 5, 2010, Cardwell and St. Clair Cardiovascular argued that Kincaid’s claim accrued on either April 25 or May 7,2008. With the tolling period provided during the notice period, see MCL 600.2912b; MCL 600.5856(c), they maintained that Kincaid had — at the latest — until October 25, 2010, to file her complaint. Because Kincaid did not file her complaint until November 30, 2010, they asserted, it was untimely. Accordingly, they asked the trial court to dismiss Kincaid’s complaint with prejudice.
In response to the motion for summary disposition, Kincaid noted that she had not alleged any specific dates in her complaint for Cardwell’s breach of the standard of care; rather, she had generally alleged that defendants had breached the standard of care for “several months leading up to the below-the-knee amputation . . . .” Kincaid argued that the evidence showed that Cardwell had breached the standard of care— through undisclosed acts and omissions — on three appointment dates: June 6, June 16, and July 9, 2008. Using June 6, 2008, as the accrual date, Kincaid concluded that her suit was timely. She explained that she had two years from the accrual date to sue, which would be June 6, 2010. See MCL 600.5805(6). However, because the period of limitations was tolled for 182 days after she filed her notice of intent to sue on April 5, 2010, see MCL 600.5856(c), she had until December 7, 2010, to sue.
Cardwell and St. Clair Cardiovascular replied to Kincaid’s response on February 24, 2012. They argued that Kincaid was, in effect, relying on the doctrine of continuing wrongs and the last treatment rule, which had been abolished in Michigan. Because the record showed that Kincaid’s claims concerned breaches that initially occurred on April 25, 2008, they maintained that the court must use that date as the accrual date.
The trial court held a hearing on Cardwell and St. Clair Cardiovascular’s motion on March 5, 2012. At the hearing, Kincaid’s lawyer again argued that there were multiple accrual dates because each time Kincaid appeared for an appointment or treatment she had a worsened condition: “It was not the same diagnosis that was being given on each presentment.” The trial court determined that, on the basis of the claims stated in her notice of intent to sue, Kincaid’s malpractice claim accrued on April 25, 2008. Consequently, it agreed that Kincaid’s suit was untimely.
The trial court entered an order dismissing Kincaid’s claims under MCR 2.116(C)(7) on March 15, 2012. After the trial court denied Kincaid’s motion for reconsideration on April 13, 2012, Kincaid appealed in this Court.
II. SUMMARY disposition
A. STANDARD OF REVIEW
On appeal, Kincaid argues that the trial court erred when it determined that her medical malpractice claim accrued solely on April 25, 2008. Specifically, she contends that she adequately alleged discrete acts and omissions that occurred on each day of treatment. Since she sued within the period of limitations applicable to the breaches of the standard of care that occurred on the last two days of treatment, she maintains that her suit was timely. This Court reviews de novo a trial court’s decision on a motion for summary disposition. Barnard Mfg Co, Inc v Gates Performance Engineering, Inc, 285 Mich App 362, 369; 775 NW2d 618 (2009). This Court also reviews de novo whether the trial court correctly selected, interpreted, and applied the relevant statutes. Gay v Select Specialty Hosp, 295 Mich App 284, 291-292; 813 NW2d 354 (2012).
B. MCR 2.116(C)(7)
Summary disposition under MCR 2.116(C)(7) is appropriate when the undisputed facts establish that the plaintiffs claim is barred under the applicable statute of limitations. See Wade v Dep’t of Corrections, 439 Mich 158, 162; 483 NW2d 26 (1992). Generally, the burden is on the defendant who relies on a statute of limitations defense to prove facts that bring the case within the statute. Turney v Detroit, 316 Mich 400, 410; 25 NW2d 571 (1947). In determining whether a plaintiffs claim is barred because of immunity granted by law, the reviewing court will accept the allegations stated in the plaintiffs complaint as true unless contradicted by documentary evidence. Maiden v Rozwood, 461 Mich 109, 119; 597 NW2d 817 (1999). Although generally not required to do so, see MCR 2.116(G)(3), a party moving for summary disposition under MCR 2.116(C)(7) may support the motion with affidavits, depositions, admissions, or other admissible documentary evidence, which the reviewing court must consider, Maiden, 461 Mich at 119, citing MCR 2.116(G)(5). The reviewing court must view the pleadings and supporting evidence in the light most favorable to the nonmoving party to determine whether the undisputed facts show that the moving party has immunity. Tryc v Mich Veterans’ Facility, 451 Mich 129, 134; 545 NW2d 642 (1996). If there is no factual dispute, whether a plaintiffs claim is barred under the applicable statute of limitations is a matter of law for the court to determine. Zwiers v Growney, 286 Mich App 38, 42; 778 NW2d 81 (2009). However, if the parties present evidence that establishes a question of fact concerning whether the defendant is entitled to immunity as a matter of law, summary disposition is inappropriate. Id. In those cases, the factual dispute must be submitted to the jury. See Tumey, 316 Mich at 411.
C. THE PERIOD OF LIMITATIONS
A person cannot sue another “to recover damages for injuries to persons or property unless, after the claim first accrued to the plaintiff . .., the action is commenced within the periods of time prescribed” by statute. MCL 600.5805(1). The period applicable to medical malpractice is two years from the accrual date. MCL 600.5805(6). Kincaid sued to recover for her injuries on November 30, 2010. In order for her suit to have been timely, her claim would have had to have accrued not earlier than November 30, 2008, unless tolled.
Kincaid could not sue without first giving Cardwell and St. Clair Cardiovascular notice of her intent to do so “not less than 182 days before the action is commenced.” MCL 600.2912b(l). In order to ensure that a plaintiff receives the full benefit of the applicable period, the Legislature provided that the period of limitations is tolled for the 182-day notice period, but only if the plaintiff gave the notice before the expiration of the period of limitations. See MCL 600.5856(c); Driver v Naini, 490 Mich 239, 249; 802 NW2d 311 (2011). It is undisputed that the earliest accrual date applicable to Kincaid’s suit against Cardwell and St. Clair Cardiovascular was April 25, 2008, and that she gave her notice to sue within two years of that date. As such, she was entitled to the full 182 days of tolling under MCL 600.5856(c). Consequently, if her medical malpractice claim accrued on or after June 1, 2008, which is two years and 182 days before the date she filed her complaint, her claim would be timely. If, however, it accrued before that date, it would be barred under MCL 600.5805(1).
1. THE LAST TREATMENT RULE
Originally, the Legislature did not provide an accrual point for medical malpractice claims. See Morgan v Taylor, 434 Mich 180, 187; 451 NW2d 852 (1990). Instead, courts applied the common-law “last treatment rule” to determine when a plaintiffs medical malpractice claim accrued. Id., citing De Haan v Winter, 258 Mich 293; 241 NW 923 (1932). Under the common-law rule, the period of limitations would only begin to run after there was a break in the patient-physician relationship: “ ‘The essence of the last treatment rule is that the cessation of the ongoing patient-physician relationship marks the point where the statute of limitations begins to run.’ ” Morgan, 434 Mich at 188, quoting Heisler v Rogers, 113 Mich App 630, 633; 318 NW2d 503 (1982). The rationale was that while the physician is treating the patient, the patient reasonably relies on the physician and is under no duty to inquire into the effectiveness of the physician’s measures. Morgan, 434 Mich at 187-188. The Legislature codified the rule at MCL 600.5838, as enacted by 1961 PA 236. See Morgan, 434 Mich at 189 n 14.
In 1986, the Legislature abrogated the last-treatment rule for medical malpractice claims. See 1986 PA 178. For all medical malpractice claims arising after October 1, 1986, the accrual date was no longer determined on the basis of the last day that the physician treated the plaintiff — it was determined on the basis of the act or omission that occasioned the harm: “For purposes of this act, a claim based on the medical malpractice of a person or entity. . . accrues at the time of the act or omission that is the basis for the claim of medical malpractice . . . .” MCL 600.5838a(l).
Although the Legislature determined that the last-treatment rule should no longer govern the accrual of medical malpractice claims, it did not replace the last-treatment rule with a first-treatment rule; rather, the accrual date depends on the date of the specific act or omission that the plaintiff claims caused his or her injury. Similarly, while the Legislature referred to “the act or omission” that is the basis for “the claim,” MCL 600.5838a(1), the Legislature did not limit a plaintiff to asserting a single claim for medical malpractice for any given injury. Because a plaintiffs injury can be causally related to multiple acts or omissions, it is possible for the plaintiff to allege multiple claims of malpractice premised on discrete acts or omissions — even when those acts or omissions lead to a single injury — and those claims will have independent accrual dates determined by the date of the specific act or omission at issue. See, e.g., Brackins v Olympia, Inc, 316 Mich 275, 279-280; 25 NW2d 197 (1946) (noting that there can be more than one proximate cause for the same injury). However, as this Court explained in McKiney v Clayman, 237 Mich App 198; 602 NW2d 612 (1999), the fact that a plaintiff may be able to plead multiple accrual dates does not mean that the plaintiff may resurrect the last-treatment rule through ambiguous or creative pleading.
2. McKINEY
In McKiney, the plaintiff, Susan McKiney, sought treatment from Dr. Lewis dayman, who was a medical doctor and dentist, for lesions on her tongue in 1989. dayman removed a cancerous growth from McKiney’s tongue in June of that same year. Thereafter, McKiney went to dayman for recurring spots on her tongue, dayman opined that the spots were not cancerous and used laser treatments to remove them in 1990, 1992, and 1993. McKiney, 237 Mich App at 199.
On December 2, 1993, different doctors tentatively diagnosed McKiney’s spots as cancer, and she related that information to dayman at an appointment on the next day. dayman continued to state his belief that the spots were not cancerous. McKiney did not return to dayman for treatment, but did speak with him on the phone several times from January to March 1994 about possible treatments. A biopsy in March 1994 revealed that McKiney had cancer, and McKiney sued dayman for malpractice on December 21, 1995. Id. at 199-200. After the trial court dismissed her claim as untimely under MCR 2.116(C)(7), McKiney appealed.
On appeal in this Court, McKiney argued that her claim was timely because she had continued to receive treatment advice from dayman by telephone through March 3, 1994. Id. at 201. In examining her argument, this Court explained that the date that dayman last treated McKiney was irrelevant because the Legislature had clearly rejected “the notion that the existence of a continuing physician-patient relationship by itself could extend the accrual date beyond the specific, allegedly negligent act or omission charged.” Id. at 203. Instead, the relevant accrual date was the date of the act or omission about which she complained. Id., citing MCL 600.5838a(l).
Turning to the acts and omissions that served as the basis of McKiney’s claim, the Court noted that McKiney had essentially alleged that dayman failed to properly diagnose her cancer and failed to properly treat her by conducting appropriate examinations or referring her to more competent healthcare providers. McKiney, 237 Mich App at 202. It explained that she did not identify a specific date on which these failures occurred, but instead merely alleged that the “failures represented ongoing deficiencies that continued until the termination date of the parties’ physician-patient relationship” in March 1994. Id. Notwithstanding these allegations, the Court concluded that McKiney could not rely on any acts or omissions that dayman might have made through the December 3, 1993 appointment because those acts and omissions would have occurred more than two years before McKiney sued on December 21, 1995.
The Court in McKiney conceded that each treatment date through the visit on December 3, 1993, could — in theory — have served as a separate accrual date, but it is also impliedly held that a physician’s mere adherence to an initial misdiagnosis and erroneous treatment plan at later appointments was insufficient by itself to give rise to new accrual dates. Id. at 204. Although the Court assumed that dayman’s diagnoses and treatments in 1990, 1992, and 1993 “constituted separate acts or omissions that would represent new accrual dates,” it clarified that the record did not actually support the conclusion that the treatments were “new, distinct, and separate acts or omissions” because McKiney’s own testimony showed that dayman merely “adhered to the same diagnosis and treatment determinations” that he had previously made. Id. at 204 & n 4. Similarly, the Court held that McKiney’s telephone conversations with dayman through March 3, 1994, did not establish an accrual date in March 1994 because the record evidence again showed that dayman “merely adhered to his original misdiagnosis and treatment determination.” Id. at 207. The Court stated that it would not resurrect the last-treatment rule by adopting a continuing-wrong or continuing-treatment rule. Id. at 208.
Under the decision in McKiney, courts cannot permit a plaintiff to revive the last-treatment rule by merely pleading that the defendant had an “on-going” or “continuing” duty to act throughout the duration of the patient-physician relationship. Nevertheless, the Court in that case did not address the nature of the pleadings or proofs that would be adequate to remove the case from one pleading a continuing-wrong theory. Likewise, although the court in McKiney held that a plaintiff could not revive the last-treatment rule by simply pleading that his or her physician continued to adhere to a mistaken diagnosis or treatment plan throughout the duration of the patient-physician relationship, it did not foreclose the possibility that continued adherence to a particular diagnosis or treatment plan might, under the facts, constitute a discrete negligent act or omission for purposes of determining the accrual date. Therefore, we shall now turn to the nature of the pleadings and proofs that a plaintiff must allege or support with evidence in order to establish that the physician’s adherence to an initial diagnosis or treatment plan constituted a discrete act or omission for purposes of establishing a later accrual date.
3. ESTABLISHING THE ACCRUAL DATE
A plaintiff must provide sufficient facts in his or her complaint to give the defendant notice of the claims against which he or she must defend: the plaintiff must provide a “statement of facts, without repetition, on which the pleader relies in stating the cause of action, with the specific allegations necessary reasonably to inform the adverse party of the nature of the claims the adverse part is called on to defend[.]” MCR 2.111(B)(1). Although there is no heightened standard of pleading for medical malpractice claims, cf. MCR 2.112(B)(1), Michigan courts have recognized that the complexity of medical malpractice litigation may require a greater degree of precision in pleading the facts constituting the claim in order to comply with the notice requirements set forth in MCR 2.111(B)(1). See Dacon v Transue, 441 Mich 315, 329-333; 490 NW2d 369 (1992); Taylor v Kent Radiology, PC, 286 Mich App 490, 507; 780 NW2d 900 (2009); Martinez v Redford Community Hosp, 148 Mich App 221, 230; 384 NW2d 134 (1986).
In Dacon, our Supreme Court explained the importance of providing the defendant physicians with sufficient notice of the acts or omissions that allegedly caused the plaintiffs injuries. In that case, Walter Dacon, as the next friend of his daughter Ericca Dacon, sued the physicians who had treated Ericca for meningitis when she was nine months old. Dacon, 441 Mich at 319-321. On appeal, our Supreme Court determined that the trial court did not err when it refused to allow Dacon to present evidence at trial in support of his theory that the physicians committed malpractice by delaying Ericca’s treatment. Id. at 327-328. The Court explained that Dacon’s complaint did not adequately state such a claim: “plaintiffs allegation that the defendant pediatricians did not provide ‘appropriate treat ment and/or medication in appropriate dosage and/or duration’ does not introduce any issue into the case.” Id. at 329-330. The allegation did not “refer either specifically or generally to any facts” and “delineate[d] nothing specific about how the pediatricians erred.” Id. at 330. That is, the allegation did not comply with MCR 2.111(B)(1) because it did not provide reasonable notice regarding any specific act or omission: “By literally alleging everything, this allegation alleges nothing.” Id.
Thus, a plaintiff must plead facts that are sufficient to place the defendant physician on notice of the specific acts or omissions that the plaintiff believes caused his or her injuries. Id. Depending on the complexity of the acts or omissions at issue, this may require the plaintiff to identify with some degree of specificity how the physician breached the standard of care. See Martinez, 148 Mich App at 233 (“[I]t is the nature of the cause of action itself which will dictate the degree of specificity required, i.e., the more complex the action, the more specific the averments should be.”). In the context of a physician’s continued adherence to an initial diagnosis or treatment plan after the abrogation of the last-treatment rule, it is insufficient to merely allege that the defendant breached the standard of care by continuing to adhere to the original diagnosis or treatment plan. See McKiney, 237 Mich App at 207. By failing to identify the facts that make the continued adherence unreasonable, see Dacon, 441 Mich at 330, the plaintiff reduces the claim to one alleging a continuing wrong, which the plaintiff cannot do, see McKiney, 237 Mich App at 207-208. In order to establish that continued adherence to an initial diagnosis or treatment plan constitutes a discrete act or omission on a date after the date when the initial diagnosis or plan was adopted, the plaintiff must plead — and be able to prove— facts that would establish that the continued adherence at the later point constituted a breach of the duty owed to the plaintiff.
Even if a plaintiff fails to properly plead facts establishing that his or her physician’s continued adherence to a diagnosis or treatment plan constituted an applicable act or omission, it must be recalled that a plaintiff may generally erne defective pleadings by amendment before trial. See MCR 2.118(A)(2); Dacon, 441 Mich at 333. Because a plaintiff generally has the opportunity to cure defects in his or her pleadings by amendment, it is not necessarily fatal to the plaintiffs case that he or she failed to adequately allege facts establishing that the physician’s continued adherence to the diagnosis or treatment plan constituted a discrete act or omission within the period of limitations. Instead, even if the plaintiffs complaint is defective in this regard, the plaintiff may survive a properly supported motion under MCR 2.116(C)(7) by presenting evidence that establishes a question of fact about whether the physician’s continued adherence constituted a breach of duty that occurred within the applicable period of limitations, see Zwiers, 286 Mich App at 42; Barnard Mfg, 285 Mich App at 374, and that, given the evidence and the case’s procedural posture, the plaintiff should be entitled to cure the deficiency in the pleadings by amendment under MCR 2.118(A)(2).
With these general principles in mind, we shall now examine Kincaid’s complaint and the evidence that she presented in response to Cardwell and St. Clair Cardiovascular’s motion for summary disposition.
D. APPLYING THE LAW
1. THE EVIDENCE IN SUPPORT OF DISMISSAL
In her complaint, Kincaid referred to several generic acts and omissions that she alleged caused her injury; she alleged that Cardwell and St. Clair Cardiovascular failed to “timely evaluate and treat” her, failed to “refer” her “for appropriate care and treatment,” failed to warn her about the severity of her condition, failed to perform tests, failed to follow up with her, failed to notify her that they were not competent to treat her, and failed to otherwise act reasonably. She did not, however, provide any details about the acts or omissions that would relate the acts or omissions to her specific course of treatment. She also did not identify any specific dates for a particular act or omission. Rather, she described these failings as occurring in the “months leading up to [her] amputation on July 21, 2008 . . . .”
Although Kincaid did not allege facts in her complaint that would have allowed Cardwell and St. Clair Cardiovascular to identify the specific date or dates on which Kincaid believed Cardwell breached the standard of care, Cardwell and St. Clair Cardiovascular did not move for a more definite statement or to strike the pleadings. MCR 2.115. Instead, they relied on Kincaid’s notice of intent to sue to establish the dates when Kincaid’s claim might have accrued. Because her notice was part of her malpractice “process” or “proceeding,” see Bush v Shabahang, 484 Mich 156, 176-177; 772 NW2d 272 (2009), and constituted other documentary evidence, MCR 2.116(G)(5), the trial court could properly consider it along with Kincaid’s complaint in deciding the motion under MCR 2.116(C)(7).
In her notice, Kincaid first stated the same generic assertions that Cardwell and St. Clair Cardiovascular should have timely evaluated and treated her, should have referred her for care and treatment, and should have warned her about the severity of her condition. But she also identified specific tests that Cardwell should have performed, the point at which Cardwell allegedly failed to properly diagnose her, and the point at which he should have warned her that he was not qualified to treat her and failed to refer her to someone who was qualified:
No later than April 23 [sic], 2008, Dr. Cardwell was required to perform [a] lower extremity angiography, or refer the patient and make certain that she underwent [a] lower extremity angiography by a competent physician, to identify the site of the occlusion(s), any collateral circulation, possible target vessels for bypass, and visualization of run-off vessels. Dr. Cardwell was also required to conduct duplex studies to assess the caliber and patency of the patient’s veins as soon as he could arrange same. Further, Dr. Cardwell was required to recognize the red flags of discoloration of her toes, re-injuries to the toes, numbness, tenderness and pain, on top of the clinical presentation including weak femoral pulses, weak pedal pulses and a hardly detectable pedal pulse on the left. No later than April 25, 2008, as soon as Dr. Cardwell learned that the patient had “potentially severe Arterial Occlusive Disease of the left lower extremity”, Dr. Cardwell was required to notify the patient that she needed urgent care and treatment, and that he was not competent or qualified to treat this patient for a severe Arterial Occlusive Disease of the left lower extremity. Further, as of that date, Dr. Cardwell was required to refer the patient for appropriate care and treatment by a competent and qualified vascular or other surgeon before gangrene or ischemic necrosis occurred.[ ]
In addition to the claimed acts and omissions on April 25, 2008, Kincaid alleged that Cardwell should have warned her that he was not competent to treat her condition and should have referred her to another physician on May 7, 2008. She also alleged that Card- well should have informed LaMar that he could not treat Kincaid on May 7, 2008, and should have informed LaMar that Kincaid still had good blood flow to her foot.
Finally, Kincaid alleged that at “all times” Cardwell was required to notify Kincaid and LaMar that he was not competent to treat Kincaid, that an MRA revealed that Kincaid’s “left. . . tibial artery” was likely occluded within the mid portion, but the “proximal portion appeared ‘widely patent[’], and that the patient was a candidate for a bypass or re-vascularization.” Similarly, she alleged that, at “all times,” Cardwell was “required to order appropriate wound care and antibiotics for the non-healing ulcers he saw when he first met Plaintiff.”
Reading Kincaid’s complaint in light of her notice, it appears that the discrete acts or omissions that serve as the basis for her malpractice claims against Cardwell and St. Clair Cardiovascular occurred before June 1, 2008. Each of the dates identified by Kincaid in her notice was before June 1, 2008. Kincaid’s notice shows that Cardwell’s failure to properly treat and diagnose her began on her first visit to him on April 25, 2008. It was at that point that he should have first realized that he was not competent to treat her condition and should, for that reason, have referred her to a qualified physician. It was also at that point that he should have ordered the specific tests identified in Kincaid’s notice. Kincaid also stated that Cardwell should have referred her to another physician and informed her and her treating physicians about his inability to treat her and about his findings to that point on May 7, 2008, which he did not do.
The general allegations that at “all times” Cardwell failed in certain regards cannot save Kincaid’s claims. She alleged that Cardwell had failed to inform her that he was not qualified and failed to order proper wound care at all times. But it was clear from her complaint that his failure to inform her and treat her wound arose on the first day of treatment and that he merely continued with this allegedly erroneous course of treatment. Merely alleging that a physician continued to adhere to a mistaken diagnosis or treatment plan at later appointments is insufficient to establish an independent act or omission on those later appointment dates. McKiney, 237 Mich App at 207-208. This is not to say that a physician is immunized from liability by simply adhering to a mistaken diagnosis or treatment plan at all subsequent appointments. Rather, a physician must act within the standard of care on each visit, and a physician’s continued adherence to a particular diagnosis or treatment plan at a later appointment might constitute a breach of the standard of care if there are facts that show that continued adherence was unreasonable. Moreover, if the continued adherence to the diagnosis or treatment plan constitutes a breach of the standard of care, the plaintiff may seek redress for the harms caused by that breach as a separate claim, even if the initial adoption of the diagnosis or treatment plan was itself outside the period of limitations. In other words, the plaintiff can plead and prove that his or her physician’s failure to correct the initial diagnosis or treatment plan constituted a breach of the standard of care that was distinct from the initial adoption of the diagnosis or treatment plan.
Here, however, Kincaid did not allege facts to establish that Cardwell breached the standard of care by continuing to adhere to an original diagnosis or treatment plan. Because Kincaid’s allegations, even when viewed in the light most favorable to her, cannot be interpreted as alleging discrete acts or omissions that occurred on specific dates after his first treatment, those general allegations must be understood to refer to acts or omissions that first occurred on April 25, 2008. All later acts and omissions involving the failure to inform, refer, and treat — in the absence of more specific allegations or evidence — are simply part of Cardwell’s continuing course of treatment and Kincaid could not rely on Cardwell’s continuing treatment alone to establish later accrual dates. Id. Finally, Kincaid’s allegation that at “all times” Cardwell failed to inform her or her physicians about the fact that an MRA revealed that she was a candidate for bypass also referred to an act or omission that occurred before June 1, 2008. As noted in her notice of intent to sue, Kincaid had the MRA on April 28, 2008, and her next visit with Cardwell was on May 7, 2008. Thus, Cardwell’s failure to properly inform Kincaid or her physicians about the MRA arose on or before May 7, 2008.
Kincaid’s complaint was so vague about the specific acts constituting malpractice (failing to treat, refer, inform, perform tests, notify, and act reasonably) and the dates that the acts occurred (referring to a period of “several months”) that it arguably failed to identify any act or omission by Cardwell with sufficient specificity to permit Cardwell to offer a defense. See Dacon, 441 Mich at 329-330. Reading Kincaid’s complaint in the light most favorable to her, she alleged that Cardwell breached the standard of care on the first day of treatment and that all subsequent treatment was a mere continuation of these allegedly improper acts and omissions; therefore, they could not serve as discrete acts or omissions for purposes of the accrual date. See McKiney, 237 Mich App at 207-208.
In contrast to her complaint, Kincaid’s notice of intent to sue provided some additional details concerning the specific acts or omissions that supported her claims against Cardwell and St. Clair Cardiovascular. But, as discussed earlier, it is clear that each act or omission had to have occurred before June 1, 2008. Consequently, Cardwell and St. Clair Cardiovascular initially established that they were entitled to summary disposition under MCR 2.116(C)(7). And, as such, the burden shifted to Kincaid to show that there was — at the very least — a question of fact about whether her claims were timely. Zwiers, 286 Mich App at 42; Barnard Mfg, 285 Mich App at 374.
2. KINCAID’S RESPONSE
In her reply brief, Kincaid relied in part on the very fact that her complaint was vague: “Plaintiff maintains that Defendants violated the standard of care for treatment provided several months leading up to Plaintiffs July 21, 2008 amputation . . . This broad reference to months, Kincaid maintained, must be interpreted in light of her recitation of the facts to conclude that each date of treatment involved separate acts and omissions. Despite attaching her medical records, letters by Card-well concerning her treatment, and her affidavit of merit, Kincaid did not meaningfully connect the evidence to any act or omission by Cardwell that occurred on or after June 1, 2008. Rather, it was apparently her position that, because Cardwell continued to treat her after June 1, 2008, the court must assume that her allegations applied equally to each treatment date. It was not the trial court’s responsibility to sift through the evidence attached to Kincaid’s response to determine whether it could identify specific acts or omissions that might give rise to a later accrual date. See Barnard Mfg, 285 Mich App at 377-379. Rather, Kincaid had the burden of bringing forth evidence to contradict the evidence presented by Cardwell and St. Clair Cardiovascular to establish a question of fact about whether her claims were timely filed. This she did not do. By failing to identify the specific negligent acts or omissions that occurred during the June 6, June 16, or July 9, 2008, appointments, Kincaid was left relying on Cardwell’s continued treatment to establish new accrual dates on each appointment after the first, which she could not do. See McKiney, 237 Mich App at 207-208.
Kincaid’s lawyer did make a belated effort to correct these deficiencies at oral argument on the summary disposition motion; it was then that Kincaid’s lawyer first alleged that Cardwell’s continued adherence to a mistaken diagnosis constituted a breach of the standard of care. Kincaid’s lawyer began by distinguishing the facts in McKiney from Kincaid’s case; she explained that in McKiney, the plaintiff did not present any evidence that there were new symptoms that gave rise to a new duty:
There was nothing new presented. There was no new diagnosis that he was giving. Conversely in our case here each time the — each time Plaintiff presented to the Doctor’s officer she was showing a worsening symptom. So the first time she presented, yes, she had discoloration of the — in her toes and they had did [sic] all these tests, et cetera. The next time she presented she had further discoloration of the toes. They were doing the femoral pulses. One time she had [a] femoral pulse in the left leg. Next time they had the femoral pulse but there was no pedal/push action. Then you keep going to June 6th and then June 16th she’s worsening in her discomfort. She’s worsening in her presentment. She’s getting gangrene in the toes and still the Defendant, the Defendant Doctor did not refer her out and did not - failed to diagnose that she had a serious problem with her foot.
In reviewing a motion for summary disposition, this Court must determine whether the trial court erred on the basis of the arguments and evidence properly presented to the trial court. Barnard Mfg, 285 Mich App at 380-381. Although Kincaid’s brief continued to assert claims that amounted to a continuing wrong, she could have remedied that defect at oral arguments by showing that there was evidence that established a discrete negligent act or omission on a later date. See id. at 380 (noting that the parties may bring to the trial court’s attention evidence that is contained in the record in their briefs or orally at the motion hearing). And Kincaid’s lawyer tried to do just that; she argued that Cardwell committed an act or omission giving rise to liability by adhering to his initial diagnosis or treatment plan despite evidence that Kincaid’s condition had worsened. The evidence that Kincaid’s condition was progressively worsening, she maintained, gave rise to an independent duty to reevaluate his diagnosis and presumably adopt new treatments for Kincaid’s condition or to refer Kincaid to another physician. However, Kincaid’s lawyer only generally referred to the record evidence; she did not identify specific pieces of evidence that showed that Kincaid’s condition had worsened and did not identify the evidence that showed that a physician in Cardwell’s position would have revised his or her diagnosis or treatment plan in light of Kincaid’s condition on the later appointment dates. In the absence of such evidence, Kincaid was left with her claim that Cardwell breached the standard of care by continuing to adhere to his initial diagnosis and treatment plan; however, Cardwell’s continued adherence was by itself insufficient to establish a question of fact about whether he committed an act or omission on or after June 1, 2008. McKiney, 237 Mich App at 207-208.
III. CONCLUSION
Kincaid did not allege facts in her pleadings that adequately placed Cardwell and St. Clair Cardiovascular on notice of any acts or omissions that occurred on or after June 1, 2008, that might have given rise to liability. As such, her claims were untimely on the face of her pleadings. Moreover, in response to Cardwell and St. Clair Cardiovascular’s properly supported motion for summary disposition under MCR 2.116(C)(7), Kincaid failed to present evidence to establish a question of fact about whether Cardwell committed an act or omission on or after June 1, 2008. Therefore, the trial court did not err when it concluded that, under the undisputed facts, Kincaid’s claims were untimely and should be dismissed under MCR 2.116(C)(7).
Affirmed. As the prevailing parties, Cardwell and St. Clair Cardiovascular may tax their costs. MCR 7.219(A).
Fitzgerald, P.J., and Meter, J., concurred with M. J. Kelly, JJ.
We have derived the facts relating to Kincaid’s doctor’s visits from her medical records, which she attached to her brief in response to the motion for summary disposition.
The Court in Morgan ultimately concluded that the legislative version of the last-treatment rule was more expansive than the common-law version because it referred to the date the professional discontinued treating or “ ‘otherwise serving’ ” the patient. See Morgan, 434 Mich at 193. But that holding has no application to the facts of this case.
We have quoted the ninth paragraph of § 2 from Kincaid’s notice of intent to sue, which is headed “Applicable Standard of Practice.” However, Kincaid used substantially the same language to describe the manner in which Cardwell breached the standard of care and the action that he should have taken to achieve compliance.
By way of some nonexhaustive examples, it might have been a breach of the standard of care for Cardwell to continue to adhere to an initial diagnosis or treatment plan in the face of evidence that Kincaid’s symptoms had worsened or had not improved as expected under the initial treatment plan or after he received new test results. Similarly, if Cardwell failed to physically examine Kincaid at a subsequent visit and, as a result, did not have information that would have caused a reasonable physician to revise his or her diagnosis and treatment plan, the failure to conduct an examination might also constitute a distinct breach.
As already noted, Cardwell and St. Clair Cardiovascular did not move to strike the complaint or ask for a more definite statement. See MCR 2.115. Cardwell and St. Clair Cardiovascular similarly failed to plead facts in support of their statute of limitations defense; they merely asserted that Kincaid’s complaint “may he barred in whole or part by the Statute of Limitations” without pleading any facts that, if left unrebutted, would show that Kincaid’s claims were untimely. See MCR 2.111(F)(3); see also Shank v Woodworth, 111 Mich 642, 643; 70 NW140 (1897) (stating that a defendant must plead the facts supporting the defendant’s statute of limitations defense or it is waived); Robinson v Emmet Co Rd Comm, 72 Mich App 623, 641; 251 NW2d 90 (1976) (“We rule it was incumbent upon the defendant in the instant case to properly raise such a defense by pleading both the appropriate statute and the facts which indicated that the statute was applicable as a special defense which prevented recovery against this defendant.”). But Kincaid did not move to strike the defense or otherwise argue that Cardwell and St. Clair Cardiovascular had waived the defense. Therefore, we have limited our analysis accordingly.
Although Barnard Mfg concerned the shifting burden applicable to a motion for summary disposition under MCR 2.116(0(10), we believe that this same analysis applies to factual questions involving a motion for summary disposition under MCR 2.116(C)(7). | [
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PER CURIAM.
Respondent appeals as of right a determination of the Michigan Tax Tribunal (MTT) that payments made by petitioner for continuing medical education (CME) expenses and for medical malpractice insurance (MMI) premiums did not constitute compensation under the Single Business Tax Act (SBTA), MCL 208.1 et seq. We reverse.
I. BASIC FACTS
Petitioner is a Michigan domestic professional services corporation, incorporated pursuant to the Professional Service Corporation Act (PSCA), MCL 450.221 et seq. Petitioner is engaged in a medical practice specializing in orthopedic medicine. All of its directors, officers, and shareholders are practicing physicians, and the medical practice operates through the work of these individual physicians and their support personnel. In 2003, petitioner paid salaries to the individual physicians, but in 2004 petitioner assigned its employment agreements to three different employee leasing compa nies or professional employer organizations (PEOs). From 2004 through 2006, the PEOs paid the physicians’ salaries. For all of the tax years at issue, petitioner paid MMI premiums and CME expenses for its physicians.
In April 2009, respondent audited petitioner’s tax returns for the years 2003 through 2006 and concluded that petitioner failed to properly add back as compensation amounts paid for CME and MMI premiums. Respondent issued a final assessment for $29,167 in taxes plus $9,826.71 in interest. Petitioner appealed the assessment to the MTT.
At the hearing, Thomas Murphy, the certified public accountant who prepared petitioner’s tax returns for the years at issue, testified that he treated petitioner’s payment of CME expenses and MMI premiums as “ordinary business expenses,” not “compensation.” He asserted that the CME expenses and MMI premiums were a working condition fringe benefit under the Internal Revenue Code — specifically, 26 USC 3401(a)(19) — as an excludable benefit that was not subject to federal withholding and not considered compensation. Murphy explained that under the SBTA, compensation included, but was not limited to, payments that were subject to or specifically exempted from withholding under sections 3401 to 3406 of the Internal Revenue Code, 26 USC 1 et seq., which included the provision he had referred to in describing how he classified the payments. Murphy testified that professional MMI is different from other professional insurance that covers, for example, a firm composed of certified public accountants. A medical malpractice insurer will only issue coverage to a doctor, individually. A medical professional corporation may then purchase a “rider” of insurance to cover its other employees and the corporation. Murphy acknowledged that CME is necessary for annual licensure.
In a written opinion, the MTT found for petitioner and canceled the assessment, ruling that the physicians and physician’s assistants were not “employees” of petitioner and that the CME and MMI premiums paid by petitioner were “ordinary and necessary business expenses” that did not constitute compensation.
Respondent moved the MTT for reconsideration. After considering the motion, the MTT found that it had “partially erred in [its] analysis” but that “the error [did] not change the ultimate outcome of the case.” The MTT reiterated that “[Respondent’s argument regarding whether the compensation would be appropriately added back to the compensation of the operating company or the PEO was properly excluded as the CME and MMI premiums were found to be business expenses and not compensation.” The MTT stated that its “analysis would have been better articulated by making a finding that for all tax years that the CME and MMI premiums paid were ordinary and necessary business expenses and not compensation.” The MTT denied respondent’s motion and ordered that the original final opinion and judgment be corrected. Respondent now appeals as of right.
II. STANDARD OF REVIEW
As a preliminary matter, we reject petitioner’s contention that this is a case involving a simple factual determination by the MTT; rather, the case is clearly a matter of statutory interpretation. Thus, while our “ ‘review of Tax Tribunal decisions in nonproperty tax cases is limited to determining whether the decision is authorized by law and whether any factual findings are supported by competent, material, and substantial evidence on the whole record’ . . . [i]ssues involving the interpretation and application of statutes are reviewed de novo as questions of law.” Toaz v Dep’t of Treasury, 280 Mich App 457, 459; 760 NW2d 325 (2008), quoting J C Penney Co, Inc v Dep’t of Treasury, 171 Mich App 30, 37; 429 NW2d 631 (1988); see also Const 1963, art 6, §28.
“The primary goal of statutory interpretation is to give effect to the Legislature’s intent, focusing first on the statute’s plain language.” Klooster v City of Charlevoix, 488 Mich 289, 296; 795 NW2d 578 (2011). The words used by the Legislature in writing a statute provide us with the most reliable evidence of the Legislature’s intent. Id. While generally the interpretation of a statute by an agency charged with its execution is entitled to “ ‘the most respectful consideration,’ ” an agency’s construction of a statute is not binding on the courts and cannot conflict with the Legislature’s intent as expressed in clear statutory language. In re Rovas Complaint Against SBC Mich, 482 Mich 90, 103; 754 NW2d 259 (2008) quoting Boyer-Campbell v Fry, 271 Mich 282, 296; 260 NW 165 (1935) (citation and quotation marks omitted). To the extent petitioner argues that CME expenses and MMI premiums are exempt from being considered “compensation” within the meaning of the SBTA, tax exemptions are strictly construed in favor of the taxing authority. Sietsema Farms Feeds, LLC v Dep’t of Treasury, 296 Mich App 232, 236; 818 NW2d 489 (2012).
The Legislature defined “compensation” in MCL 208.4(3). “When a statute specifically defines a given term, that definition alone controls.” Haynes v Neshewat, 477 Mich 29, 35; 729 NW2d 488 (2007).
III. ANALYSIS
The SBTA imposed “a specific tax upon the adjusted tax base of every person with business activity in this state that is allocated or apportioned to this state . . . MCL 208.31(1). “The SBTA requires generally that in calculating its Single Business Tax (SBT) tax base, a corporation include compensation paid.” Herald Wholesale, Inc v Dep’t of Treasury, 262 Mich App 688, 696; 687 NW2d 172 (2004). Respondent argues that petitioner’s payment of CME expenses and MMI premiums constituted “compensation” as defined in MCL 208.4(3), which provided, in relevant part:
Except as otherwise provided in subsection (4), “compensation” means all wages, salaries, fees, bonuses, commissions, or other payments made in the taxable year on behalf of or for the benefit of employees, officers, or directors of the taxpayers. Compensation includes, but is not limited to, payments that are subject to or specifically exempt or excepted from withholding under sections 3401 to 3406 of the internal revenue code[, 26 USC 3401 to 3406]. [Emphasis added.]
Petitioner argues that its payment of CME expenses and MMI premiums was for its own benefit, not that of its employees. Petitioner contracts with large health care delivery organizations that require petitioner to provide licensed and insured physicians and physician’s assistants. Accordingly, petitioner argues that payment of CME and MMI was necessary to operate its business. Petitioner maintains that such payments only residually benefited the employees.
The PSCA prohibited a professional corporation, such as petitioner, from “rendering] professional services within this state except through its officers, employees, and agents who are duly licensed or otherwise legally authorized to render the professional services within this state.” MCL 450.225. The Public Health Code, MCL 333.1101 et seq., requires all practicing physicians to be licensed. MCL 333.17011(1). The Michigan Administrative Code requires 150 hours of CME as a prerequisite for license renewal or relicensure. Mich Admin Code, R 338.2371. Thus, physicians are legally obligated to attend CME classes in order to remain licensed. Additionally, petitioner’s own expert testified that MMI is issued only to individual physicians. Thus, regardless of whether petitioner benefited from paying for CME and MMI, those payments benefited the physicians, who would have otherwise had to pay their own CME for continued licensure and MMI to reduce their exposure to liability and potential personal financial ruin.
Moreover, the Supreme Court has held that the provision “including but not limited to” is not one of limitation. In re Forfeiture of $5,264,432 Mich 242, 255; 439 NW2d 246 (1989). “Rather ... the phrase connotes an illustrative listing, one purposefully capable of enlargement.” Id. There is no language in MCL 208.4(3) to support the proposition that payments made must be primarily, substantially, or totally “on behalf of or for the benefit of” petitioner’s employees in order to constitute compensation.
Petitioner relies on Ford Motor Co v Dep’t of Treasury, 288 Mich App 491; 794 NW2d 357 (2010), in which a panel of this Court had occasion to interpret MCL 208.4(3). In that case, the plaintiff had made contributions to “an irrevocable trust created under a voluntary employees’ beneficiary association (VEBA), 26 USC 501(c)(9),” exceeding those required by the applicable union contract. Id. at 492, 498. Individual “employees submitted bills for health-care services covered under the employee health-care plan to plaintiff, and plaintiff would pay the bills and receive reimbursement from the VEBA trust.” Id. at 493-494. After conducting an audit, the defendant “concluded that the contributions made into the VEBA trust. . . were taxable compensation and should have been added to plaintiffs tax base and then ‘offset’ by the amounts ... reimbursed [to] plaintiff. ...” Id. at 494. The plaintiff disputed the assessment in the Court of Claims, which granted summary disposition in favor of the defendant. Id. at 492-493. This Court reversed, holding that the contributions made by the plaintiff to the YEBA did not constitute compensation under the SBTA. Id. at 493.
The facts in Ford Motor Co are distinguishable from those at bar. In Ford Motor Co, the VEBA trust essentially operated as a savings fund for the plaintiff. The plaintiff reimbursed itself with VEBA funds after paying contractually obligated health-care benefits to its employees. Here, petitioner directly paid CME expenses and MMI premiums for its employees. In Ford Motor Co, although plaintiffs contributions to the VEBA trust were not compensation under the SBTA, its payment of employee health-care benefits undisputedly constituted compensation. Unlike in Ford Motor Co, petitioner’s payment of CME expenses and MMI premiums was not merely potential compensation of its employees; rather, they were made in the taxable year for the benefit of individual employees. Contrary to petitioner’s contention, Ford Motor Co never held that payments with “indirect” or “residual” benefit to its employees are not compensation.
Because petitioner’s payment of CME expenses and MMI premiums was on behalf of and for the benefit of the physicians and physician’s assistants in its employ, those payments constituted compensation for purposes of petitioner’s SBT tax base calculation.
Reversed and remanded for entry of an order consistent with this opinion. We do not retain jurisdiction.
K. E Kelly, P.J., and Markey and Fort Hood, JJ., concurred.
The SBTA was repealed by 2006 PA 325 and replaced, effective December 31, 2007, by the Michigan Business Tax Act, 2007 PA 36, MCL 208.1101 et seq.
The PSCA was repealed by 2012 PA 569. | [
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WILDER, P.J.
Respondent appeals as of right an order that terminated his parental rights to the minor child, AJR, under the stepparent adoption statute, MCL 710.51(6). The order also allowed petitioner-stepfather, who is married to AJR’s mother, to adopt AJR. Because respondent had joint legal custody over the child, MCL 710.51(6) did not apply, and we reverse.
i
Respondent and petitioner-mother were married and had one child, AJR, during their marriage. The two later divorced, and in the divorce judgment, the mother was given sole physical custody of the child, with both parents sharing joint legal custody. The divorce judgment also provided that respondent would be given reasonable visitation with AJR.
Years later, the mother married petitioner-stepfather. Approximately two years into their marriage, petitioner-stepfather and petitioner-mother filed a petition for the termination of respondent’s parental rights to allow petitioner-stepfather to adopt AJR. They alleged that respondent had failed to comply with a child-support order and failed or neglected to visit, contact, and communicate with AJR during the previous two years.
After conducting a two-day evidentiary hearing on the matter, the trial court terminated respondent’s parental rights under MCL 710.51(6), finding that (1) respondent had substantially failed to provide support for AJR for the two years preceding the filing of the petition and (2) respondent had substantially failed to visit or communicate with AJR during this two-year period.
ii
This case involves issues of statutory interpretation, which are questions of law that we review de novo. Douglas v Allstate Ins Co, 492 Mich 241, 255-256; 821 NW2d 472 (2012). When interpreting a statute, our primary goal is to ascertain and to give effect to the intent of the Legislature. Mich Ed Ass’n v Secretary of State (On Rehearing), 489 Mich 194, 217; 801 NW2d 35 (2011). This task begins by examining the language of the statute itself because that language provides the most reliable evidence of the Legislature’s intent. United States Fidelity & Guaranty Co v Mich Catastrophic Claims Ass’n, 484 Mich 1, 13; 795 NW2d 101 (2009). “If the statute’s language is clear and unambiguous, then we assume that the Legislature intended its plain meaning and the statute is enforced as written.” Roberts v Mecosta Co Gen Hosp, 466 Mich 57, 63; 642 NW2d 663 (2002). “We presume that every word of a statute has some meaning and must avoid any interpretation that would render any part of a statute surplusage or nugatory. As far as possible, effect should be given to every sentence, phrase, clause, and word.” Mich Farm Bureau v Dep’t of Environmental Quality, 292 Mich App 106, 132; 807 NW2d 866 (2011) (citation omitted). Additionally, this Court may not ignore the omission of a term from one section of a statute when that term is used in another section of the statute. Farrington v Total Petroleum, Inc, 442 Mich 201, 210; 501 NW2d 76 (1993).
hi
Respondent argues that the statute under which his parental rights were terminated was not applicable to him. Specifically, respondent maintains that because he and the mother had joint legal custody over the child and the statute only acts to terminate the rights of those parents who do not have legal custody, his rights were improperly terminated. We agree.
Respondent did not raise this issue in the trial court, thus failing to preserve the issue for appellate review. In re VanDalen, 293 Mich App 120, 135; 809 NW2d 412 (2011). However, “[t]his Court may overlook preservation requirements if the failure to consider the issue would result in manifest injustice, if consideration is necessary for a proper determination of the case, or if the issue involves a question of law and the facts necessary for its resolution have been presented.” Nuculovic v Hill, 287 Mich App 58, 63; 783 NW2d 124 (2010). The issue presented here is strictly an issue of law — statutory interpretation — and all the requisite facts have been presented. Thus, in the interests of justice, we will review the issue.
The statute at issue is MCL 710.51(6), which allows for the termination of the rights of a noncustodial parent during a stepparent adoption. MCL 710.51(6) provides as follows:
If the parents of a child are divorced,... and if the parent having legal custody of the child subsequently marries and that parent’s spouse petitions to adopt the child, the court upon notice and hearing may issue an order terminating the rights of the other parent if both of the following occur:
(a) The other parent, having the ability to support, or assist in supporting, the child, has failed or neglected to provide regular and substantial support for the child or if a support order has been entered, has failed to substantially comply with the order, for a period of 2 years or more before the filing of the petition.
(b) The other parent, having the ability to visit, contact, or communicate with the child, has regularly and substantially failed or neglected to do so for a period of 2 years or more before the filing of the petition. [Emphasis added.]
Thus, in order to terminate parental rights under MCL 710.51(6), the trial court must determine that both subdivision (a) and subdivision (b) are satisfied, In re Hill, 221 Mich App 683, 692; 562 NW2d 254 (1997), as well as conclude that the conditions set out in the preceding paragraph have been satisfied. See ISB Sales Co v Dave’s Cakes, 258 Mich App 520, 529; 672 NW2d 181 (2003) (noting that phrases starting with “if” are provisos that restrict the operative effect of statutory language).
We conclude and hold that the statute’s language, “if the parent having legal custody of the child,” is to be construed as requiring the parent initiating termination proceedings to be the only parent having legal custody. The rights of a parent who maintains joint legal custody are not properly terminated under MCL 710.51(6).
The Legislature’s decision to use the phrase “the parent having legal custody,” rather than the phrase “a parent having legal custody,” is dispositive because, as our Supreme Court has explained, the terms “the” and “a” have different functions:
“The” and “a” have different meanings. “The” is defined as “definite article. 1. (used, esp. before a noun, with a specifying or particularizing effect, as opposed to the indefinite or generalizing force of the indefinite article a or an)....” Random, House Webster’s College Dictionary, p 1382. [Massey v Mandell, 462 Mich 375, 382 n 5; 614 NW2d 70 (2000).]
Indeed, if the Legislature wants to refer to something particular, not general, it uses the word “the,” rather than “a” or “an.” See Johnson v Detroit Edison Co, 288 Mich App 688, 699; 795 NW2d 161 (2010). Here, the Legislature’s use in MCL 710.51(6) of “the” refers to the particular parent having legal custody. Necessarily, this requires the particular parent to have sole legal custody. As such, the Legislature’s use of the word “the” rather than “a” controls the question before us.
Our interpretation is supported by Paige v Sterling Hts, 476 Mich 495; 720 NW2d 219 (2006), in which our Supreme Court interpreted the use of “the” in the phrase “the proximate cause” found in MCL 418.375(2). The Paige Court held that “the proximate cause” refers to “the sole proximate cause.” Id. at 510 (emphasis added). The Paige Court adopted the reasoning of the Court in Robinson v Detroit, 462 Mich 439, 462; 613 NW2d 307 (2000), which held that it was “clear that the phrase ‘the proximate cause’ contemplates one cause.” Paige, 476 Mich at 508. Similarly, we conclude that the Legislature’s use of “the parent having legal custody,” with “the” being a definite article and “parent” being a singular noun, contemplates only one parent having legal custody.
Our interpretation of MCL 710.51(6) is further strengthened by the rules of statutory construction that every word and phrase in a statute is to be given effect, if possible, and that this Court should not ignore the omission of a term from one section of a statute when that term is used in another section of the statute. See Farrington, 442 Mich at 210. Notably, the preceding subsection in the statute, MCL 710.51(5), uses the phrase “a parent having legal custody” to refer to whom that particular subsection applies. Contrastingly, MCL 710.51(6) refers to “the parent having legal custody.” We presume that the Legislature intended to use the more general phrase “a parent” to refer to either of the child’s parents in MCL 710.51(5) and that the omission of a general article in MCL 710.51(6) was intentional. Id.; see also Robinson v City of Lansing, 486 Mich 1, 14 n 13; 782 NW2d 171 (2010), quoting MCL 8.3a (stating that reviewing courts “must follow these distinctions between ‘a’ and ‘the’ because the Legislature has directed that ‘[a]ll words and phrases shall be construed and understood according to the common and approved usage of the language’ ”).
It is undisputed that when respondent and AJR’s mother divorced, the divorce judgment provided that the mother was awarded physical custody of the child, but both parents would maintain joint legal custody. Thus, because the mother did not have sole legal custody, the trial court erred when it terminated respondent’s rights under MCL 710.51(6), regardless of the fact that it found that both of the conditions in subdivisions (a) and (b) were satisfied. Because we are reversing on this ground, respondent’s other arguments are moot, and we need not address them. BP7v Bureau of State Lottery, 231 Mich App 356, 359; 586 NW2d 117 (1998).
Reversed.
METER and RIORDAN, JJ., concurred with WILDER, P.J.
MCL 418.375(2) of the Worker’s Disability Compensation Act, MCL 418.101 etseq., states the following: “If the injury received by such employee was the proximate cause of his or her death____” (Emphasis added.) | [
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SAAD, J.
Defendant Integon National Insurance Company appeals the trial court’s order denying its motion for summary disposition and granting summary disposition in favor of intervening defendant Titan Insurance Company. For the reasons set forth below, we reverse and remand.
I. NATURE OF THE CASE
The answer to the question of which insurer, Integon or Titan, is responsible for personal protection insurance (PIP) benefits arising out of a Michigan automobile accident depends on where the insured, Salvador Lorenzo, resided at the time of the accident. Because of its peculiar facts, this case raises a question of first impression because Lorenzo, an itinerant agricultural worker, did not have a “permanent” residence in any state, but lived, worked, and resided in three different states where he picked fruit on a seasonal basis. At the time of the accident, Lorenzo lived and worked in Michigan, had all his possessions with him in Michigan, and had no other residence or place he looked to or could be regarded as his home. Accordingly, for purposes of the no-fault act, Lorenzo was a resident of Michigan, and neither his out-of-state policy with Integon nor Integon’s choice to also do business in Michigan makes Integon liable for plaintiffs’ no-fault benefits. Instead, and contrary to the trial court’s ruling, Titan is the insurer responsible for the payment of plaintiffs’ PIP benefits as the carrier assigned by the Assigned Claims Facility.
II. FACTS AND PROCEEDINGS
This case arises out of an auto accident that occurred July 29, 2009, on 1-196 in Allegan County. Plaintiffs, Gerardo Tienda and Sylvia Gomez, were passengers in a Ford Expedition owned by Tienda’s uncle, Lorenzo. When the accident occurred, Lorenzo was also riding in the vehicle and Heriberto Fernandez Castro was driving. Tienda, Gomez, Lorenzo, and Castro are migrant farm workers who travel from state to state to harvest fruit. From October 2008 until May 2009, the four worked in Florida where they picked strawberries and then pulled the strawberry plants after the harvest. From May 2009 until early July, the four lived together on or near a farm in North Carolina where they harvested blueberries. Around July 4, 2009, Lorenzo drove Tienda, Gomez, and Castro in his Expedition to Michigan, they rented an apartment together in Grand Rapids, and drove together each day to a farm in Allegan County to harvest blueberries. Plaintiffs and Lorenzo testified that, before the accident, they traveled to the same states and performed the same work for many years. Though the four generally lived in housing provided to migrant workers for the harvest season, they found the Grand Rapids apartment after inquiring about available housing at a Mexican grocery store. It appears the accident occurred after work one day when the four were returning to their Grand Rapids apartment.
Before the accident, on June 22, 2009, Integon issued a North Carolina auto insurance policy to Lorenzo. When he applied for the policy, Lorenzo had a driver’s license issued by the state of Michigan. The license showed Lorenzo’s address as 66400 84th Avenue, Apartment 3, in Hartford, Michigan. Evidence established that this apartment complex was reserved for migrant farm workers during the harvest season, and that workers who returned to harvest in that area were given different apartments each year within the complex. Lorenzo stated that he received the driver’s license approximately eight years before he testified in 2011. However, on the Integon auto insurance application, Lorenzo listed his address as 115 Juan Sanchez Lane in Teachey, North Carolina and, again, it appears this address was temporary housing for migrant farm workers. Integon denied Lorenzo’s claim for benefits under its North Carolina insurance policy because, among other reasons, it maintained that Lorenzo was a Michigan resident at the time of the accident, he did not insure the vehicle with Michigan no-fault insurance, and he misrepresented the primary garaging location of the vehicle as his address in North Carolina, when he knew he planned to take the Expedition to Michigan.
Integon initially paid no-fault benefits to Tienda and Gomez, but stopped because it took the position that, at the time of the accident, Lorenzo was a Michigan resident and, under MCL 500.3163(1), Integon was only obligated to pay for injuries or property damage occurring in Michigan if the owner of the vehicle is a resident of another state. Plaintiffs filed this action against Integon and asserted that Integon must pay first-party PIP benefits, but that Integon refused to pay and unreasonably delayed paying the benefits. Plaintiffs also applied for benefits through the Assigned Claims Facility, which assigned the claim to Titan. See MCL 500.3171 et seq. The trial court permitted Titan to intervene in this action on June 14, 2010. Integon filed a cross-claim against Titan, seeking a declaratory judgment that Titan was responsible for PIP benefits owed to plaintiffs and seeking recoupment of the benefits it had already paid to plaintiffs. Titan filed a counterclaim against Integon, and argued that Lorenzo was a resident of North Carolina when he bought the policy and at the time of the accident, and that if Lorenzo was a Michigan resident, Integon was on notice of this by virtue of Lorenzo’s Michigan driver’s license and, therefore, Integon should be estopped from denying coverage for plaintiffs’ injuries.
Integon and Titan moved for summary disposition pursuant to MCR 2.116(0(10), each claiming that the other company was responsible for paying no-fault benefits to Tienda and Gomez. The trial court ultimately denied Integon’s motion and granted Titan’s motion. The court first ruled that Lorenzo’s place of residence was irrelevant and that Integon was obligated to pay for plaintiffs’ injuries, stating that it “cannot endorse a decision in this case that makes the recovery of benefits by [plaintiffs] depend on Mr. Lorenzo’s residency.” Before ruling, the court remarked that “[everybody has to be determined to be a resident of some place . . . .” The court went on to rule that, if Lorenzo’s residency was at issue pursuant to MCL 500.3163, Lorenzo was not a Michigan resident because he had no intent to reside in Michigan permanently and he had no greater connection to Michigan than the other states in which he worked. The court cited the factors set forth in Workman v DAIIE, 404 Mich 477; 274 NW2d 373 (1979), and Dairyland Ins Co v Auto-Owners Ins Co, 123 Mich App 675; 333 NW2d 322 (1983), and concluded that Lorenzo was a resident of Florida because he spent more months during the year in Florida. Comparing Lorenzo’s situation to that of a professional baseball player who travels to other states for games, the court noted that Integon’s position that Lorenzo was a Michigan resident would also mean that baseball players change residency each time they stay at a hotel in a different city. The court rejected this notion and further ruled that, as innocent third parties, plaintiffs were entitled to benefits under the Integon policy pursuant to the financial responsibility act, MCL 257.501 et seq. The court issued an order denying Integon’s motion and granting summary disposition to Titan on April 14, 2011. The court also signed an order on August 23, 2011, that directed Integon to pay plaintiffs costs and fees of $21,683.61 as a penalty for its unreasonable refusal to pay, and its delay in paying, no-fault benefits.
III. DISCUSSION
As this Court explained in Hastings Mut Ins Co v Safety King, Inc, 286 Mich App 287, 291; 778 NW2d 275 (2009):
This Court reviews de novo a trial court’s decision on a motion for summary disposition. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998). A motion for summary disposition under MCR 2.116(0(10) is properly granted if no factual dispute exists, thus entitling the moving party to judgment as a matter of law. Rice v Auto Club Ins Ass’n, 252 Mich App 25, 30-31; 651 NW2d 188 (2002). In deciding a motion brought under subrule (0(10), a court considers all the evidence, affidavits, plead ings, and admissions in the light most favorable to the nonmoving party. Id. We also review de novo issues of contract interpretation. Rory v Continental Ins Co, 473 Mich 457, 464; 703 NW2d 23 (2005).
This case also requires us to interpret sections of the no-fault act. Our Supreme Court opined in Douglas v Allstate Ins Co, 492 Mich 241, 255-256; 821 NW2d 472 (2012):
“Issues of statutory interpretation are questions of law that this Court reviews de novo.” [Griffith v State Farm MutAuto Ins Co, 472 Mich 521, 525-526; 697 NW2d 895 (2005).] When interpreting a statute, we must “ascertain the legislative intent that may reasonably be inferred from the words expressed in the statute.” [Koontz v Ameritech Servs, Inc, 466 Mich 304, 312; 645 NW2d 34 (2002).] This requires courts to consider “the plain meaning of the critical word or phrase as well as ‘its placement and purpose in the statutory scheme.’ ” [Sun Valley Foods Co v Ward, 460 Mich 230, 237; 596 NW2d 119 (1999), quoting Bailey v United States, 516 US 137, 145; 116 S Ct 501; 133 L Ed 2d 472 (1995).] If the statutory language is unambiguous, “the Legislature’s intent is clear and judicial construction is neither necessary nor permitted.” [Griffith, 472 Mich at 526, citing Koontz, 466 Mich at 312.]
We hold that the trial court erred when it ruled that Lorenzo’s residency is not relevant for purposes of determining Integon’s obligation to pay plaintiffs’ benefits. While Lorenzo bought a North Carolina auto insurance policy from Integon, Integon also sells auto insurance in Michigan. Accordingly, Integon filed a certificate of compliance pursuant to MCL 500.3163(1), which provides:
An insurer authorized to transact automobile liability insurance and personal and property protection insurance in this state shall file and maintain a written certification that any accidental bodily injury or property damage occurring in this state arising from the ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle by an out-of-state resident who is insured under its automobile liability insurance policies, is subject to the personal and property protection insurance system under this act. [Emphasis added.]
This statute subjects the insurer and insured to “the rights and immunities under the no-fault act for personal and property protection .. . .” Tevis v Amex Assurance Co, 283 Mich App 76, 85; 770 NW2d 16 (2009). The plain language of the statute states that Integon is subject to Michigan’s no-fault system if the accident arose from, in this case, the ownership of a vehicle by an “out-of-state resident.” Our Court has held that, if the insured is not a nonresident, MCL 500.3163 has no application and may not be used to impose responsibility for payment of PIP benefits on an out-of-state insurer that maintains a written certification in Michi gan. Farm Bureau Ins Co v Allstate Ins Co, 233 Mich App 38, 40-41; 592 NW2d 395 (1998). Indeed,
the only conditions of carrier liability imposed under [MCL 500.3163] are (1) certification of the carrier in Michigan, (2) existence of an automobile liability policy between the nonresident and the certified carrier, and (3) a sufficient causal relationship between the nonresident’s injuries and his or her ownership, operation, maintenance, or use of a motor vehicle as a motor vehicle. [Transport Ins Co v Home Ins Co, 134 Mich App 645, 651-652; 352 NW2d 701 (1984).]
Thus, the residency of the owner of the vehicle involved in the collision, Lorenzo, is the central, dispositive question in this case. If Lorenzo was a resident of Michigan at the time of the accident, Titan would be the priority insurer through the Assigned Claims Facility, pursuant to MCL 500.3172(1). Therefore, to the extent the trial court based its ruling on the premise that Lorenzo’s residency was irrelevant, its holding was erroneous.
The trial court also based its imposition of liability on Integon on the ground that Lorenzo was a resident not of Michigan but of Florida and was, therefore, an out-of-state resident under MCL 500.3163 when the accident occurred.
“Generally, the determination of domicile is a question of fact. However, where . . . the underlying facts are not in dispute, domicile is a question of law for the court. ” Fowler v Auto Club Ins Ass ’n, 254 Mich App 362, 364; 656 NW2d 856 (2002). As noted, in its decision from the bench, the trial court cited the factors set forth in Workman, 404 Mich at 496-497, and Dairyland, 123 Mich App at 682. In Workman, our Supreme Court considered whether a passenger injured in an auto accident could recover from her father-in-law’s insurance company as a relative “domiciled in the same household” under MCL 500.3114(1). Workman, 404 Mich at 493. The Court first ruled that, for purposes of the no-fault act in Michigan, “the terms ‘domicile’ and ‘residence’ are legally synonymous . ...” Id. at 495. See also Campbell v White, 22 Mich 178, 197 (1871) (“ ‘Ordinarily one’s residence and domicile (if they do not always mean the same thing) are in fact the same, and where they so concur they are that place which we all mean when we speak of one’s home.’ ”) (Citation omitted.) The Workman Court further observed that “[t]he ‘legal meaning’ of these terms must be viewed flexibly, ‘only within the context of the numerous factual settings possible’.” Workman, 404 Mich at 496, quoting Montgomery v Hawkeye Security Ins Co, 52 Mich App 457, 461; 217 NW2d 449 (1974). The Workman Court set forth the following nonexhaustive list of factors to determine whether a person resides or is domiciled in an insured’s household:
(1) the subjective or declared intent of the person of remaining, either permanently or for an indefinite or unlimited length of time, in the place he contends is his “domicile” or “household”; (2) the formality or informality of the relationship between the person and the members of the household; (3) whether the place where the person lives is in the same house, within the same curtilage or upon the same premises; (4) the existence of another place of lodging by the person alleging “residence” or “domicile” in the household .... [Workman, 404 Mich at 496-497 (citations omitted).]
“In considering these factors, no one factor is, in itself, determinative; instead, each factor must be balanced and weighed with the others.” Id. at 496.
Similarly, in Dairyland, this Court considered factors to determine whether a minor child was domiciled with the child’s parents for purposes of coverage under MCL 500.3114. Dairyland, 123 Mich App at 678-679. The Court took note of the Workman factors, but stated that
[O] ther relevant indicia of domicile include such factors as whether the claimant continues to use his parents’ home as his mailing address, whether he maintains some possessions with his parents, whether he uses his parents’ address on his driver’s license or other documents, whether a room is maintained for the claimant at the parents’ home, and whether the claimant is dependent upon the parents for support. [Id. at 682.]
Certainly, the question whether a relative resides in an insured’s home differs from the question of an insured’s place of residence, but some of the factors cited in Workman and Dairyland are nonetheless instructive on the issue. We are also mindful of other factual circumstances in which our courts have considered the question of domicile and residency. In Henry v Henry, 362 Mich 85, 101-102; 106 NW2d 570 (1960), our Supreme Court employed the United States Supreme Court’s formulation of “domicile” as “that place where a person has voluntarily fixed his abode not for a mere special or temporary purpose, but with a present intention of making it his home, either permanently or for an indefinite or unlimited length of time.” (Citations and quotation marks omitted.) Our Supreme Court has also explained that “[r]esidence means the place where one resides; an abode, a dwelling or habitation; especially, a settled or permanent home or domicile. Residence is made up of fact and intention.” Reaume & Silloway, Inc v Tetzlaff, 315 Mich 95,99; 23 NW2d 219 (1946) (citation and quotation marks omitted).
[I] t may safely be asserted that where one has a home, as that term is ordinarily used and understood among men, and he habitually resorts to that place for comfort, rest and relaxation from the cares of business, and restoration to health, and there abides in the intervals when business does not call — that is his residence, both in the common and legal meaning of the term. [Campbell, 22 Mich at 197-198 (citation omitted).]
Some published cases address the question of residency under MCL 500.3163 in other factual contexts, but they do not address the question of residency for seasonal agricultural workers. Farm Bureau v Allstate, 233 Mich App 38, involved a person insured by Allstate who spent time in both Michigan and Indiana. This Court affirmed the trial court’s ruling that the insured was a Michigan resident because facts showed that she
spent a significant amount of time at the Cass County, Michigan, Chain Lakes Road residence, that she frequently slept at this residence, that she received public assistance from the state of Michigan and that the public assistance checks were mailed to the Chain Lakes Road residence, the infrequency of Allstate’s insured’s stays with relatives in Elkhart, Indiana, and the fact that her children’s school had the telephone number of the Chain Lakes Road residence as a number to use to contact Allstate’s insured in the case of an emergency. Ud. at 40.]
In Witt v American Family Mut Ins Co, 219 Mich App 602, 605-606; 557 NW2d 163 (1996), the plaintiff insured his vehicle while living in Iowa and the vehicle was registered in Iowa, but, for purposes of MCL 500.3163, this Court ruled that the plaintiff was a Michigan resident:
Plaintiff moved to this state in 1990, and he has since continuously lived and worked here. Plaintiff has been registered to vote in Michigan since 1990, has maintained bank and checking accounts here, and has a Michigan telephone number. Michigan residency is declared in his state and federal income tax returns, and his employment records describe his residence as Michigan. Plaintiff has a Michigan identification card and used it to obtain a Michigan hunting license as a resident. From 1990 to 1992, he spent a total of only two weeks in Iowa, visiting during holidays. He owns no property there, has paid no rent to and received no support from his parents since 1990, has no telephone listing there, and with the exception of a student loan bill sent to his parents’ home, all his mail since 1990 has gone to a Michigan mailing address. At his deposition, plaintiff stated that, at the time of the accident, he wanted to work as a “rover,” but he had no specific plan to move anywhere else until that opportunity arose. While plaintiff still had an Iowa bank account and driver’s license, these factors were, on balance, insufficient to create a genuine issue of fact.
There are few published cases in Michigan that address the residency of migrant agricultural workers like Lorenzo and, as noted, none that addresses that issue for purposes of MCL 500.3163. In Soto v Director of the Mich Dep’t of Social Servs, 73 Mich App 263; 251 NW2d 292 (1977), the Department of Social Services denied the plaintiffs initial application for Aid to Dependent Children (ADC) because the plaintiff was not a resident of Michigan when he applied. Id. at 266. The plaintiff had traveled from Texas with his wife and three of his four children to pick fruit at a farm in Berrien County. Id. Because of an illness, the plaintiff was unable to continue working on the farm, and the family applied for ADC benefits. Id. The plaintiff and his family later decided to establish permanent residence here, and his application for ADC benefits was ultimately granted. Id. at 266-267. The plaintiff nevertheless contested the first denial of benefits, but the trial court upheld the decision on the ground that the initial denial was supported by substantial evidence on the whole record. Id. at 267, 269. In reviewing the trial court’s decision, this Court cited the Michigan Department of Social Services Assistance Payment Manual, which relied on 45 CFR 233.40(a)(1)(2) for the definition of a “resident”:
“(1) A resident of a State is one who is living in the State voluntarily with the intention of making his home there and not for a temporary purpose. A child is a resident of the State in which he is living other than on a temporary basis. Residence may not depend upon the reason for which the individual entered the State, except insofar as it may bear upon whether he is there voluntarily or for a ‘temporary purpose’.
“(2) Residence is retained until abandoned. Temporary absence from the State, with subsequent returns to the State, or intent to return when the purposes of the absence have been accomplished, does not interrupt continuity of residence.” [Soto, 73 Mich App at 269, quoting 45 CFR 233.40(a)(1)(2) (1976).]
This Court observed that “[t]his definition also accords with the normal definition of residency used for other purposes in Michigan.” Soto, 73 Mich App at 269. The Court affirmed the trial court’s ruling that, when the plaintiff first applied for ADC benefits, he was not a Michigan resident because he had come to Michigan for the limited purpose of picking fruit during the harvest season, he maintained a home in Texas in which one of his children continued to live, he sent rent money to the landlord in Texas, he kept all of the family’s furniture in Texas, he continued to make payments on a lot he was buying in Texas, he lived in temporary migrant housing on the farm in Michigan, he was treated at the migrant clinic, he applied for and received emergency assistance as a migrant, and he received food stamps at the migrant food-stamp office. Id. at 270-272. This case, of course, is different because, while the question of residency remains the same, the no-fault law is implicated and, while Lorenzo picked fruit on a seasonal basis, he maintained no other residence when he lived in Michigan and he took all of his worldly belongings with him when he traveled to each of three states to work.
“[I]t has long been the law of this state that [e]very person must have a domicile somewhere.’ ” People v Dowdy, 489 Mich 373, 385; 802 NW2d 239(2011), quoting Beecher v Common Council of Detroit, 114 Mich 228, 230; 72 NW 206 (1897). As the Court in Beecher further opined:
The domicile is acquired by the combination of residence and the intention to reside in a given place, and can be acquired in no other way. The residence which goes to constitute domicile need not be long in point of time. If the intention of permanently residing in a place exists, a residence in pursuance of that intention, however short, will establish a domicile. [Beecher, 114 Mich at 230 (citation omitted).]
Therefore, we cannot simply conclude that, because Lorenzo traveled a circuit of three states throughout the year, he has no domicile or place of residence. Moreover, no evidence was presented to show that Lorenzo had any fixed or permanent home outside the three states in which he worked during the picking seasons. Accordingly, we must consider the evidence presented and determine whether the trial court correctly concluded that, as a matter of law, Lorenzo’s residence was in Florida. We hold that the trial court erred in this holding.
As discussed, Lorenzo purchased the North Carolina insurance policy while living in housing reserved for migrant workers on or near a farm in North Carolina, and he gave that address when he filled out his application. At the same time, he held, for several years, a driver’s license issued by the state of Michigan. In determining his residence, the Workman and Dairyland factors only partially assist in our analysis. With regard to Lorenzo’s intent, when he moved to Grand Rapids in early July 2009, Lorenzo had no intent to remain in Michigan permanently, but intended to make Grand Rapids his home until October. Thereafter, Lorenzo planned to continue, and did continue, to travel the same circuit between Michigan, Florida, and North Carolina, as he had done for several years. With the regularity of the blueberry and grape harvest seasons, Lorenzo stayed in Michigan, and intended to do so for the foreseeable future. Workman contemplates the formality of the relationship of the person claiming residence with others in the household and also inquires whether they lived on the same premises but, although Lorenzo traveled to Michigan with plaintiffs, rented an apartment with them, and worked at the same farm, their relationship is immaterial because determining whether Integon or Titan is primarily responsible to pay benefits does not depend on whether the workers shared a common household. Again, however, no evidence showed that Lorenzo had any other place of lodging or any other location at which he kept any belongings or had a room maintained for him.
Viewing the evidence under the Dairyland decision, we note that Lorenzo never had a bank account and, while in Michigan, he would cash his checks at a liquor store near the blueberry farm. He did not receive or pay bills at the address in Grand Rapids, but would pay the landlord in cash and used a cellular phone with a prepaid card. However, Lorenzo had no other address at which he received any mail or other documents. Lorenzo cannot read or speak English, so his son either signed the lease or helped him rent the apartment in Grand Rapids with Tienda, Gomez, and Castro. While Lorenzo generally stayed in migrant housing on or near the farms at which he worked — for example, in Teachey, North Carolina; in Dover or Plant City, Florida; and at the address on his driver’s license in Hartford, Michigan — the apartment he rented in Grand Rapids was several miles away from the blueberry farm, and evidence showed it was not part of any housing provided by the farm at which he and the others were employed.
The trial court reasoned that Lorenzo’s residence was in Florida at the time of the accident because he spent more time there, apparently because the strawberry season was longer and Lorenzo could continue his work there by clearing the fields after the harvest ended. But, under these facts, the duration of time Lorenzo lived in Florida is of little consequence, because he lived in temporary migrant housing there, fully intended to leave in May, had no documents linking him to Florida, and maintained no room or possessions there when he left. Further, although Lorenzo had a Michigan driver’s license, he did not have any certification linking him to a Florida address or residency. The same could be said for North Carolina, where Lorenzo applied for auto insurance but lived in temporary migrant housing and never intended to “garage” his car for purposes of North Carolina policy coverage.
We find inapposite the trial court’s comparison of Lorenzo to a professional baseball player who travels for games throughout the season. As noted, the trial court reasoned that, if these migrant workers changed their place of residency each time they moved, professional baseball players would also change residency each time they stayed in a new hotel room while on the road. As Integon points out, professional baseball players maintain permanent homes and do not carry with them all of their possessions when they play away games. We think Integon’s analogy is more apt: “[I]f a journeyman ballplayer were traded regularly from one team to another, season after season, and even arriving at a new team’s city with a full expectation that, following that season, he will be traded somewhere else, his state of residency undoubtedly would change each time he moved, unless he maintained a permanent home base throughout all the moves - which the persons involved in the case at bar did not.” (Emphasis removed.) Indeed, when Lorenzo or, for that matter, Tienda and Gomez were asked where they would say they lived at the time of the accident, they each responded that they lived in Michigan or that their fixed address was in Michigan. Indeed, they could not have responded otherwise because they had with them all of their worldly possessions and had no other place to call home.
It may appear that, given the nature of Lorenzo’s itinerant lifestyle, his ties to Michigan appear as strong or as tenuous as his ties to North Carolina or Florida. However, under these unique facts, and for the reasons stated, we hold that, when the accident occurred on July 29, 2009, Lorenzo was a resident of Michigan as a matter of law. Accordingly, we hold that the trial court erred when it ruled that Lorenzo was a resident of Florida, and it erred by denying Integon’s motion for summary disposition and granting summary disposition to Titan. Because Lorenzo was a Michigan resident when the accident occurred, Titan is the priority insurer responsible for the payment of no-fault benefits to plaintiffs. We also vacate the trial court’s order awarding plaintiffs costs and fees under MCL 500.3148 for Integon’s failure to pay plaintiffs’ no-fault benefits. See Attard v Citizens Ins Co of America, 237 Mich App 311, 317; 602 NW2d 633 (1999) (stating that “a delay is not unreasonable if it is based on a legitimate question of statutory construction, constitutional law, or factual uncertainty”). We remand for further proceedings to determine whether plaintiffs are otherwise entitled to fees or costs from Titan under the court’s prior order that directed Titan to temporarily pay plaintiffs’ no-fault benefits.
Reversed and remanded. We do not retain jurisdiction.
BOONSTRA, P.J., and HOEKSTRA, J., concurred with SAAD, J.
As noted, Integon denied Lorenzo’s claim for benefits, and he did not litigate the matter. As one reason for the denial, Integon cited MCL 500.3113(b), which provides that a person is not entitled to PIP benefits if, at the time of the accident, “[t]he person was the owner or registrant of a motor vehicle . .. involved in the accident with respect to which the security required by [MCL 500.3101] . .. was not in effect.” MCL 500.3101(1) provides that a Michigan resident “shall maintain security for payment of benefits under personal protection insurance, property protection insurance, and residual liability insurance.” According to Integon, Lorenzo was a Michigan resident, and he did not maintain adequate insurance under the Michigan no-fault act.
The statute also provides that “claimants have the rights and benefits of personal and property protection insurance claimants, ‘including the right to receive benefits from the electing insurer as if it were an insurer of personal and property protection insurance applicable to the accidental bodily injury or property damage.’ ” Tevis, 283 Mich App at 85, quoting MCL 500.3163(3). Integon grants that plaintiffs are “innocent third parties” and does not argue that they should be denied no-fault benefits, but maintains that Titan is the liable party under Michigan law.
We note that tens of thousands of migrant workers come to this state each year to harvest crops, and, if they own or operate a motor vehicle in Michigan, they must be aware of, and abide by, the no-fault act. Michigan residents must register their vehicles and maintain adequate insurance under the act, and out-of-state residents must obtain Michigan no-fault coverage if they operate a vehicle in Michigan for more than 30 days in a calendar year pursuant to MCL 500.3102(1). In other words, although not at issue here because Lorenzo had not yet operated the vehicle in Michigan for 30 days when the accident occurred, if he was, indeed, a resident of Florida, it was incumbent on him to maintain no-fault insurance coverage if he did drive the vehicle in Michigan for more than 30 days. Failure to carry no-fault coverage is a misdemeanor under MCL 500.3102(2), and a conviction carries a mandatory fine of $200 to $500 and/or imprisonment for up to a year. Thus, for people who travel to Michigan for, as here, three to four months out of each year for agricultural work or other reasons, they must carry no-fault insurance coverage as a matter of law or face criminal penalties. | [
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PER CURIAM.
Defendant appeals as of right an order denying her motion for summary disposition pursuant to MCR 2.116(C)(7) (governmental immunity) and (8) (failure to state claim). We conclude that the mandatory reporting provision of the Child Protection Law (CPL), MCL 722.623, does not abrogate the governmental immunity statute, MCL 691.1407. While the mandatory reporting provision imposes liability when an individual named in the statute fails to report suspected abuse or neglect, that liability is limited by governmental immunity. Therefore, we reverse the order of the trial court and remand for further proceedings in order to afford plaintiff an opportunity to seek leave to amend the complaint.
I. BASIC FACTS AND PROCEDURAL HISTORY
Plaintiff is the personal representative of the estate of Ava Annmarie Jones, deceased. Defendant was employed by the Michigan State Police. The complaint against defendant alleged, in relevant part:
5. Ava Annmarie Jones died as a result of the following facts:
a. Kelly Ann Jones is the mother to Ava Annmarie Jones.
b. On or about December 7, 2008, Kelly Ann Jones had morphine pills in her possession and in the residence she shared with the decedent.
c. On or about December 7, 2008, Kelly Ann Jones negligently allowed the decedent to have access to or deliberately provided morphine pills to the decedent.
d. On or about December 7, 2008, the decedent was 2 years 8 months old.
e. On the morning of December 8, 2008, the decedent was found by Kelly Ann Jones to be unresponsive and not breathing.
f. Emergency medical care was rendered to the decedent on December 8, 2008 but she was pronounced dead by the local medical examiner.
g. An autopsy revealed levels of morphine in the decedent which were lethal and described as the mechanism of her death.
6. Defendant owed the decedent a duty to use due care.
7. Defendant violated that duty in the following manner:
a. In October, 2008, members of the Straights [sic] Area Narcotics Enforcement Team (SANE) used an informant, Devon Ollie Johnson-Backus (Backus), to purchase morphine from Kelly Ann Jones.
b. During October and November of 2008, Defendant and other members of SANE were aware that during purchases of morphine by Backus from Kelly Jones that the decedent was present during the exchange.
c. Defendant and other members of SANE directed and caused the purchase of the morphine pills from Kelly Jones by Backus.
Plaintiff alleged that defendant violated the “mandatory reporting provisions” of MCL 722.623, which require a law-enforcement officer to report suspected child abuse or neglect. Plaintiff specifically alleged:
8. As a direct and proximate result of the breach by Defendant, the decedent died.
9. The conduct of Defendant Bitner and other members of SANE were grossly negligent and demonstrated a substantial lack of concern for whether the decedent was injured or died because:
a. Defendant Bitner and other members of SANE were motivated by their desire to obtain another successful prosecution of decedent’s mother;
b. Defendant Bitner and other members of SANE were motivated by a desire to protect the identity of their confidential information [sic];
c. Defendant Bitner and other members of SANE were aware that morphine was a dangerous, scheduled controlled substance;
d. Defendant Bitner and other members of SANE were aware of the age and helplessness of the decedent;
e. Defendant Bitner and other members of SANE were aware of the mother-daughter relationship between Kelly Jones and the decedent and the decedent’s dependency on Kelly Jones;
f. Defendant Bitner and other members of SANE were aware of the specific strength and quality of the pills possessed and sold by Kelly Jones;
g. Upon information and belief, Defendant Bitner and other members of SANE knew or should have known of their obligation to report based upon their previous and subsequent reports of drug dealers to Children’s Protective Services and policy;
h. Defendant Bitner and other members of SANE knew or should have known that the pills were potentially lethal if ingested by decedent.
Defendant moved for summary disposition. Defendant argued that she did not have “reasonable cause to suspect child abuse or neglect,” so there was no corresponding duty to report. Defendant further argued that, even if she had a duty to report, governmental immunity was a defense to plaintiffs claim because she was not grossly negligent and her failure to report was not the proximate cause of decedent’s death.
In response, plaintiff argued that his complaint alleged both common-law gross negligence and negligence per se. Plaintiff argued that knowingly allowing a young child to remain in such a home environment showed reckless and callous behavior. Plaintiff also argued that defendant was negligent per se and violated her duty to report.
The trial court denied defendant’s motion for summary disposition. On the basis of plaintiffs complaint, it was assumed that defendant knew that decedent’s mother illegally distributed drugs from her house in decedent’s presence and that, from these alleged facts, a jury could find that defendant had “reasonable cause” to believe that the child was neglected, thus triggering defendant’s duty to report. The trial court further concluded that the governmental immunity statute, MCL 691.1407, did not provide a defense to plaintiffs claim because defendant had a statutory duty to report the possible neglect. Thus, plaintiffs claim was subject to the “damages proximately caused by” standard of MCL 722.633(1), not the stricter “the proximate cause” standard of MCL 691.1407(2)(c). (Emphasis added.) The trial court indicated that only after defendant reported the possible neglect would plaintiffs claim be subject to governmental immunity.
The trial court’s April 18, 2012, order indicated that defendant’s motion for summary disposition was denied pursuant to MCR 2.116(C)(8). However, on May 23, 2012, the trial court entered a stipulated order amending its original order to provide that summary disposition was denied pursuant to MCR 2.116(C)(7) as well. Defendant now appeals as of right.
II. STANDARD OF REVIEW
We review de novo a trial court’s decision regarding a motion for summary disposition. Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999).
Summary disposition is appropriate when a claim is barred because of “immunity granted by law. . . .” MCR 2.116(C)(7). A party may support a motion under MCR 2.116(C)(7) with affidavits, depositions, admissions, or other documentary evidence. Odom v Wayne Co, 482 Mich 459, 466; 760 NW2d 217 (2008). “In reviewing a (C)(7) motion, a court must accept all well-pleaded allegations as true and construe them in favor of the nonmoving party.” Tellin v Forsyth Twp, 291 Mich App 692, 698; 806 NW2d 359 (2011).
Similarly, in evaluating a party’s motion for summary disposition pursuant to MCR 2.116(C)(8), a court “must accept all well-pleaded factual allegations as true, construing them in a light most favorable to the nonmoving party.” Cummins v Robinson Twp, 283 Mich App 677, 689; 770 NW2d 421 (2009). Summary disposition on the basis of subrule (C)(8) should be granted “only where the claims are so clearly unenforceable as a matter of law that no factual development could possibly justify recovery.” Cummins, 283 Mich App at 689-690 (quotation marks and citation omitted).
We also review de novo questions of statutory interpretation involving the application of governmental immunity. Carr v City of Lansing, 259 Mich App 376, 379; 674 NW2d 168 (2003). “The primary goal of judicial interpretation of statutes is to ascertain and give effect to the intent of the Legislature.” Id.
III. ANALYSIS
The CPL imposes a duty on certain listed professionals to report suspected child abuse or neglect. Marcelletti v Bathani, 198 Mich App 655, 659; 500 NW2d 124 (1993). MCL 722.623(l)(a) reads, in relevant part, as follows:
An individual is required to report under this act as follows:
(a) A... law enforcement officer... who has reasonable cause to suspect child abuse or neglect shall make immediately, by telephone or otherwise, an oral report, or cause an oral report to be made, of the suspected child abuse or neglect to the department. Within 72 hours after making the oral report, the reporting person shall file a written report as required in this act.
MCL 722.633(1) further provides:
A person who is required by this act to report an instance of suspected child abuse or neglect and who fails to do so is civilly liable for the damages proximately caused by the failure.[ ]
Plaintiff relies heavily on Williams v Coleman, 194 Mich App 606; 488 NW2d 464 (1992), to support his position that the mandatory reporting provision abrogates defendant’s ability to claim governmental immunity. In Williams, the decedent was a 23-month-old child who died under circumstances suggesting “long-term nutritional deprivation or failure to thrive.” Id. at 608-609. The defendants were social workers employed by the Wayne County Department of Social Services. Id. at 608. The plaintiff, the personal representative of the decedent’s estate, sued the defendants in 1982, alleging failure to report child abuse and neglect as required by MCL 722.623. Williams, 194 Mich App at 608-609. On appeal, the defendants argued that common-law governmental immunity for individual governmental employees protected them from liability under the CPL. Id. at 610-612. In affirming the judgment against the defendants, this Court explained that the purpose of the CPL is to “protect abused and neglected children.” Id. at 614. In light of this purpose, the Legislature decided to impose the reporting requirement on a variety of professionals because “it made clear that child safety is a priority and that the needs of the listed professionals are secondary where it comes to reporting.” Id. at 615. Importantly, the listed professionals included both governmental employees and nongovernmental employees. Id. at 613-614. Further, the legislative history and the plain language of the CPL “reveal[ed] the Legislature’s intent to apply the statute to the persons listed, regardless of their employment status.” Id. at 614. Accordingly, this Court held that “through the Child Protection Law the Legislature intended to abrogate established immunity rales of the common law related to persons required to report abuse and neglect.” Id. at 615-616.
However, Williams was decided under Ross v Consumers Power Co (On Rehearing), 420 Mich 567, 631-632; 363 NW2d 641 (1984). In Ross, our Supreme Court held that governmental immunity for individuals was provided by the common law. Certain high-level officials were generally absolutely immune from tort liability, while lower-level officials were immune from tort liability when acting within the scope of employment, acting in good faith, and performing discretionary acts. Id. at 633-634. When Ross was decided, the then existing version of MCL 691.1407 only protected agencies, not individuals. In 1986, the Legislature amended MCL 691.1407. It currently reads, in relevant part, as follows:
(2) Except as otherwise provided in this section, and without regard to the discretionary or ministerial nature of the conduct in question, each officer and employee of a governmental agency, each volunteer acting on behalf of a governmental agency, and each member of a board, council, commission, or statutorily created task force of a govern mental agency is immune from tort liability for an injury to a person or damage to property caused by the officer, employee, or member while in the course of employment or service or caused by the volunteer while acting on behalf of a governmental agency if all of the following are met:
(a) The officer, employee, member, or volunteer is acting or reasonably believes he or she is acting within the scope of his or her authority.
(b) The governmental agency is engaged in the exercise or discharge of a governmental function.
(c) The officer’s, employee’s, member’s, or volunteer’s conduct does not amount to gross negligence that is the proximate cause of the injury or damage.
Accordingly, under the current governmental immunity law for lower-ranking employees, courts should follow a three-part test when, as here, the plaintiff has pleaded a negligent tort:
If the plaintiff pleaded a negligent tort, proceed under MCL 691.1407(2) and determine if the individual caused an injury or damage while acting in the course of employment or service or on behalf of his governmental employer and whether:
(a) the individual was acting or reasonably believed that he was acting within the scope of his authority,
(b) the governmental agency was engaged in the exercise or discharge of a governmental function, and
(c) the individual’s conduct amounted to gross negligence that was the proximate cause of the injury or damage. [Odom, 482 Mich at 479-480.]
With respect to the third element, it is important to distinguish between “the proximate cause” and “a proximate cause.” Robinson v Detroit, 462 Mich 439, 468; 613 NW2d 307 (2000). “[T]he proximate cause” means “the one most immediate, efficient, and direct cause” of the plaintiffs injuries. Id. at 446.
The CPL sets forth a lower standard for liability for a failure to report than the governmental immunity statute. Under the CPL, a person may be liable for a failure to report when the child’s injures were “proximately caused by” the failure to report. MCL 722.633(1). The CPL also does not refer to the strict “grossly negligent” standard. In contrast, under the governmental immunity statute, a defendant’s actions must be both grossly negligent and “the proximate cause” of the child’s injuries. MCL 691.1407(2)(c) (emphasis added). Plaintiff argues that the lower standard set forth in the mandatory reporting statute applies and that there is no reason to look at the narrower standard under the governmental immunity statute. We disagree.
“Although the [governmental tort liability act (GTLA), MCL 691.1401 et seq.] proclaims that it contains all the exceptions to governmental immunity, the Legislature remains free to create additional exceptions, either within the GTLA or another statute.” State Farm Fire & Cas Co v Corby Energy Servs, Inc, 271 Mich App 480, 485; 722 NW2d 906 (2006). In explaining the rule that the Legislature may create exceptions to individual governmental immunity not specifically referred to in the GTLA, this Court reasoned that the Legislature cannot bind future Legislatures. Id. MCL 691.1407 was amended in 1986 to provide governmental immunity for individual governmental employees. The CPL was enacted before 1986, and the Legislature has repeatedly made minor amendments to the CPL after 1986. We conclude that the mandatory reporting statute does not provide an exception to the general statutory rule of governmental immunity for individual governmental employees. The Legislature is presumed to be aware of the consequences of its use or omission of statutory language and the effect of new laws on all existing laws. In re Messer Trust, 457 Mich 371, 380; 579 NW2d 73 (1998); Walen v Dep’t of Corrections, 443 Mich 240, 248; 505 NW2d 519 (1993). In spite of its knowledge regarding the GTLA, the Legislature has not amended the mandatory reporting statute to clearly provide that it abrogates the later-enacted governmental immunity statute. A more recently enacted law has precedence, especially when the statute is both the more specific and the more recent. Parise v Detroit Entertainment, LLC, 295 Mich App 25, 28; 811 NW2d 98 (2011).
We find further support for applying the governmental immunity statute to the mandatory reporting statute in Hannay v Dep’t of Transp, 299 Mich App 261; 829 NW2d 883 (2013). In Hannay, we concluded that while a plaintiff could bring a claim under the motor vehicle exception to governmental immunity, “the fact that a tort action arising from a motor vehicle accident may be pursued against a governmental entity does not except the action from the application of the no-fault act [MCL 500.3101 et seq.].” Hannay, 299 Mich App at 267. Thus, in determining the amount of damages that a plaintiff may recover from a governmental agency under the motor vehicle exception to governmental immunity, the no-fault act must apply. Id. The same principle holds true in the case at bar. The mandatory reporting statute must be read in conjunction with, and is therefore limited by, the governmental immunity statute. It follows that, in order for defendant to be liable under the mandatory reporting statute, her conduct must have been grossly negligent and the proximate cause of Ava’s death.
The record reveals that Ava’s mother, Kelly Ann Jones, was convicted of involuntary manslaughter following Ava’s death. See People v Jones, unpublished opinion per curiam of the Court of Appeals, issued July 5, 2011 (Docket No. 298948). It was alleged that Kelly Ann Jones either intentionally administered a lethal amount of morphine to Ava or allowed Ava to come into contact with morphine pills and then failed to seek assistance when she realized that Ava had taken some of the pills off a nightstand. From the limited record before us, it appears that only Kelly Ann Jones’s acts or omissions were the proximate cause of Ava’s death. Thus, it follows that defendant’s alleged failure to report could not have been the proximate cause of Ava’s death and that plaintiffs claim is barred by immunity granted by law. Despite the foregoing, plaintiffs counsel seeks the opportunity to amend the complaint to plead specific allegations of gross negligence and proximate cause. Plaintiff also argues that discovery, which has not yet been undertaken, will support the allegations in an amended complaint. Because the trial court did not have the opportunity to rule on these issues, we conclude that plaintiff ought to have the opportunity to seek leave to amend the complaint in the trial court. The trial court may then make a determination regarding whether such an amendment would be futile.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
K. F. Kelly, P.J., and Markey and FORT Hood, JJ., concurred.
The initial order indicated that defendant’s motion was denied pursuant to MCR 2.116(C)(8), but the parties later stipulated amending the order to clarify that defendant’s motion was denied pursuant to MCR 2.116(C)(7) as well.
Although the motion requested summary disposition pursuant to MCR 2.116(C)(8), the argument was really for summary disposition based on immunity, which should have been brought pursuant to MCR 2.116(C)(7).
MCL 722.633(2) further provides: “A person who is required by this act to report an instance of suspected child abuse or neglect and who knowingly fails to do so is guilty of a misdemeanor punishable by imprisonment for not more than 93 days or a fine of not more than $500.00, or both.”
Because we conclude that defendant is entitled to judgment as a matter of law under the governmental immunity statute, we decline to address the remainder of her arguments, including her claim that there was no “reasonable suspicion” to suspect abuse or neglect. Again, we will accept plaintiffs well-pleaded allegations as true. | [
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PER CURIAM.
This case involves a dispute over the settlement signed by the parties in December of 2001, during their divorce proceedings. The agreement called for Melvin Kaftan to make a series of payments to Carole Kaftan. After Melvin stopped making payments in 2009, the parties each filed suit against the other. Carole sought to recover the remaining payments due under the settlement agreement, while Melvin sought a modification or rescission of the contract because certain real estate assets retained by him under the agreement turned out to be incorrectly valued, in part because of predivorce fraud perpetrated by a business partner. We affirm. Even assuming that the statute of limitations does not bar Melvin’s arguments, he has failed to assert facts that would properly constitute a defense or claim of mutual mistake.
I. FACTS
The parties signed the property settlement agreement on December 29, 2001. The agreement did not contain a valuation of the estate. However, a financial statement prepared for Melvin, and reviewed by an expert chosen by Carole, set the value at $14,517,000. A large portion of the marital estate consisted of real estate holdings, which Melvin mostly retained under the agreement. In return, the agreement called for him to make a series of payments to Carole through 2017, totaling $7,704,00o.
The property settlement agreement contains multiple indications that it was meant to permanently resolve all questions relating to the parties’ marital property. It declares that the parties “are now desirous of definitely and for all times settling and determining all issues pertaining to property division . . . and all other claims or rights between them . ...” It prohibits any amendment or modification except by further written agreement, and also does not authorize the circuit court to modify any provisions except by stipulation of the parties. The agreement does not state that the parties intended to divide their assets 50-50, and it contains no valuations of the individual properties at issue. Moreover, the agreement states that “[t]here are no representations or warranties other than those expressly herein set forth” and that each party acknowledged their right to “verification of facts” relevant to the agreement. The agreement did make provision for fraud or concealment, but only if committed by one of the parties: “The release shall not operate to release either party from any fraudulent acts, intentional nondisclosure of assets and liabilities, misrepresentations or conduct, which may become known hereafter and detrimentally affect the other party.”
Melvin made all payments through 2008, but stopped making payments in 2009. When asked at his deposition why he stopped paying, Melvin responded that Carole had refused to help him cover their son’s losses in a business deal. He also testified that the reason he stopped making payments was that he discovered that, through the fraud of a business partner, the real estate holdings had actually been worth only $4,936,000 in 2001, not $14,517,000 as the parties had thought at the time.
Several of the real estate projects that Melvin retained in the divorce were organized, managed, and partly owned by Rodney Robinson. According to Melvin, in 2002, after the settlement agreement was completed, he learned that Robinson was in financial difficulties. Melvin had guaranteed a number of loans for the projects he invested in with Robinson, and as these projects defaulted on their loans, banks were threatening to pursue collection efforts against Melvin. As a result, Melvin and Robinson traded properties in a number of swap agreements, beginning in July 2002, so that Melvin could completely separate his holdings from Robinson.
Melvin asserts that in December 2008, he learned that Robinson had been jailed for fraud in a project unrelated to Melvin’s investments. Melvin’s additional investigations revealed that before the Kaftans’ divorce Robinson had committed fraud regarding the properties he and the Kaftans owned. Specifically, Melvin claims that Robinson took money from some projects to pay debts for others, falsified construction lien waivers, secretly mortgaged projects, and sold some projects while continuing to list them as assets.
Melvin testified that he did not know about Robinson’s fraudulent activities before December 2008. However, he also admitted at his deposition that he discovered some irregularities in 2002 while conducting the swap agreements with Robinson. Melvin testified regarding a property called Woodlands Office Park:
When we went to the swap it came out [Robinson] took a nine hundred and some thousand dollar mortgage to build a building on it for himself. We were right in the midst of getting all of those documents from the bank to show that he stole that piece of land from me. In the swap he was broke. I had to take... about a half a million dollars that he’s going to owe me.
He later added, “Well, Mr. Robinson stole it from me. We found out at the swap time.” In addition, Robinson’s company Land Equities had already defaulted on a loan owed to Melvin by the time of the divorce.
Melvin and Carole each filed suit against the other on September 15, 2009, and later filed motions for summary disposition under MCR 2.116(0(10). The trial court granted summary disposition in favor of Carole, holding that Melvin’s argument of mistake was barred by the statute of limitations and laches, and also that he failed to establish a mutual mistake. Carole also sought sanctions as part of her motion for summary disposition, but the trial court refused to grant them. Melvin appealed the grant of summary disposition, and Carole cross-appealed the trial court’s failure to impose sanctions against Melvin.
II. standard of review
We review de novo grants of summary disposition. Auto Club Group Ins Co v Burchell, 249 Mich App 468, 479; 642 NW2d 406 (2001). Equitable issues, such as arguments for rescission or reformation, are also reviewed de novo. See Stevenson v Aalto, 333 Mich 582, 588; 53 NW2d 382 (1952).
III. MUTUAL MISTAKE
A mutual mistake is “an erroneous belief, which is shared and relied on by both parties, about a material fact that affects the substance of the transaction.” Ford Motor Co v City of Woodhaven, 475 Mich 425, 442; 716 NW2d 247 (2006). Carole relies primarily on two cases to argue that there is no mutual mistake in this case. In Marshall v Marshall, 135 Mich App 702; 355 NW2d 661 (1984), a husband sought to modify a property settlement agreement after stocks that he received in the agreement later sold for less than he expected. Similarly, in Smith v Smith, 292 Mich App 699; 823 NW2d 114 (2011), a wife sought to modify a settlement agreement after the value of an individual retirement account (IRA) assigned to her husband under the contract increased substantially. In each case, the court denied relief because the “mistake” involved only the final selling price of the stocks and the IRA, and thus was external to the contract.
Melvin responds that these cases involved changes in value postdivorce while the instant case involves a mutual error in valuation at the time of the property settlement. We agree that a postdivorce fluctuation in value more plainly falls outside the parameters of mutual mistake. However, under the terms of this settlement agreement, the instant circumstances do not constitute a mutual mistake. As described earlier, the agreement did not provide for any modifications absent fraud by one of the parties, did not state an intent to divide the sum of all assets equally, and contained numerous disclaimers and assertions of finality.
A similar scenario was recently considered by the New York Court of Appeals in Simkin v Blank, 19 NY3d 46; 945 NYS2d 222; 968 NE2d 459 (NY, 2012). In that case, part of the marital estate being divided consisted of an investment account that, because of Bernard Madoff s Ponzi scheme, was later determined to have been worth far less than the parties believed at the time of their agreement. The trial court had held that a cause of action for mutual mistake was permitted under the circumstances. However, the Court of Appeals held that although the Ponzi scheme was ongoing at the time the agreement was signed, the situation was more akin to cases in which a marital asset unexpectedly loses value after dissolution of a marriage, and therefore did not constitute a mutual mistake. Id. at 55. The court noted that the agreement, like the one in this case, did not explicitly state that the property was to be divided equally, nor did it explicitly value the relevant asset account. Id. at 54.
Though it is not controlling, we find the New York Court of Appeals’ reasoning in Simkin to be persuasive, especially given the factual similarity to the present case. In this case, as in Simkin, the husband bargained to retain property that he now asserts was affected by a third party’s fraud at the time of the divorce. The agreement here, like in Simkin, does not place a specific value on the real estate or indicate that it must be divided equally. Further, the agreement evinces an intent by the parties to permanently resolve the distribution of their marital property. Melvin agreed to pay Carole a sum certain, without regard to changes in the real estate market in general or to factors affecting only his specific holdings.
In Smith, this Court noted:
The values of the retirement accounts were stated in fixed terms. It is well known that stocks fluctuate on a daily basis. The parties were free to fix the values of the accounts at any time. They could have fixed the value at the time the divorce complaint was filed or at the time the divorce judgment was entered. They could have expressly provided that the division of the retirement accounts was subject to modification for market fluctuations. However, they did not do any of this. [Smith, 292 Mich App at 704-705].
Similarly, in the present case the parties could have included terms in the settlement agreement providing for the payments to Carole to be adjusted based on changes in the value of the real estate properties or qualifying Melvin’s promise to pay in the event of any unforeseen or unforeseeable circumstances. However, while the agreement contains provisions allowing for adjustment of the property settlement in case of fraud by the parties themselves, it contains no such provisions for fraud by a third party or unknown inaccuracies in either or both of the parties’ assessment of value.
Accordingly, we conclude, as did the trial court, that given the detailed nature of the written agreement between sophisticated parties, we may not impose modifications outside those provided for in the agreement itself.
IV SANCTIONS
Carole’s motion for summary disposition included a request for sanctions that the trial court denied. We review a trial court’s decision regarding sanctions for an abuse of discretion. Richardson v Ryder Truck Rental, Inc, 213 Mich App 447, 450; 540 NW2d 696 (1995).
The trial court did not abuse its discretion by rejecting Carole’s request for sanctions. This case was complicated, both legally and factually, and no Michigan case was sufficiently similar to command without question the result we have reached. Though Melvin’s arguments ultimately failed, they were not devoid of arguable legal merit. Kitchen v Kitchen, 465 Mich 654, 662-663; 641 NW2d 245 (2002); MCL 600.2591(3).
V CONCLUSION
The trial court correctly ruled that Melvin failed to state a claim or defense of mutual mistake. Summary disposition in favor of Carole was therefore appropriate. The trial court did not abuse its discretion by denying Carole’s request for sanctions.
Affirmed.
CAVANAGH, P.J., and SAAD and SHAPIRO, JJ., concurred.
This amount was divided into $2,388,000 in payments falling under section 71 of the Internal Eevenue Code, 26 USC 71, and $5,316,000 in “additional property settlement.”
For example, instead of each owning 50% of property A and property B, one would take 100% of A and the other 100% of B.
The highest appellate court in New York is the Court of Appeals, rather than the Supreme Court. | [
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BOONSTRA, P.J.
Plaintiff appeals the trial court’s grant of summary disposition to defendants on the grounds of governmental immunity. Plaintiff only challenges the trial court’s ruling with respect to defendant A. J. Palmerton, and only insofar as the trial court held that Palmerton was acting “in the course of employment” when plaintiff was injured and therefore was entitled to qualified governmental immunity pursuant to MCL 691.1407(2). For the reasons stated in this opinion, we affirm.
I. BASIC FACTS AND PROCEDURAL HISTORY
This case arises out of an accident that occurred on February 20, 2010, on the frozen surface of Higgins Lake in Roscommon County. Plaintiff was out on the ice of the lake with a small group of people with snowmobiles during the “Winterfest” festival, which they had attended earlier. Plaintiff recalled observing an “air-boat” on the ice when they first arrived at the festival, although he did not pay much attention to it.
During Winterfest, the Roscommon County Sheriffs Department provided rides in the airboat to the general public. Defendant Randall Stevenson, the Roscommon County Sheriff, had previously asked deputies who were trained in the airboat’s operation and who would be off duty that day whether they would be willing to provide airboat rides at the festival; however, all the off-duty deputies had declined. Palmerton was one of those deputies; he declined because he had plans to visit family that day. Eventually Deputy Jeff Grieser, an on-duty officer, was chosen to provide the rides.
Palmerton’s plans to visit relatives fell through, so he decided to take his family to Winterfest. Palmerton was not on duty that day. Palmerton and his family attended some activities at the festival. At some point, Palmerton stated that he went over to the airboat “to see if Deputy Grieser would need any assistance with” the airboat rides. Palmerton specifically testified that he “showed up to help out anyway.” Palmerton brought his wife and son with him. Palmerton stated that he asked Grieser, “Hey, do you need any help?” and that Grieser responded that he was about to give his last ride of the day. Palmerton testified that Grieser appeared willing to give Palmerton’s oldest child a ride in the airboat. Palmerton stated that some neighbors of his, the Schwartzes, who had two young boys, also approached the airboat because their children wanted a ride. Palmerton stated that he told Grieser, “Oh, you’ve been driving it all day. I can take my family out” and that he told Grieser he would drive the airboat since he wanted to help him that day and “give him a break.. . .” Palmerton took his mother, his son, and the two Schwartz boys for a ride.
The airboat in question was gas-powered and propelled forward by a large rear-facing fan; the airboat does not have brakes. The responsiveness of the controls depends on numerous factors, including the type of terrain.
At the time Palmerton took his group out for an airboat ride, plaintiff and members of his group were standing on the ice around their snowmobiles about a quarter-mile away from Winterfest. Plaintiff stated that he had allowed his friend’s daughter, Megan, to take his snowmobile for a ride. Plaintiff stated that Megan rode off in a westward direction on the snowmobile and that he noted that the airboat came between Megan and him. Plaintiff noticed that the airboat began to turn back around, but he did not pay a great deal of attention to it.
Palmerton testified that he took the airboat in a generally southwest direction for about 10 to 15 minutes before deciding to head back. Palmerton began to turn the airboat when he was about 150 feet past plaintiffs group; he stated that this distance was “well past what would normally be safe ....” As he made the turn, Palmerton stated that the snow “kind of grabbed” the airboat, and it ended up pointed directly at the group. Palmerton stated that he tried to turn the airboat in either direction with no success. As the airboat was still heading toward the group, Palmerton decided to take his foot off the accelerator so that if there was a collision, it would be at a slow speed.
Plaintiff noticed that the airboat was coming closer, but did not feel that he was in any danger. The airboat struck a snowmobile and slid towards plaintiff, pinning his leg between the boat and a snowmobile. Plaintiff stated that the airboat was going no more than five miles per hour; Palmerton estimates that it was no more than four miles per hour. Plaintiff suffered a severe injury to his right knee that required two surgeries and resulted in total disability from his job as a sheriffs deputy for Crawford County.
Plaintiff filed suit against Palmerton, Roscommon County, and Stevenson. Plaintiff asserted a gross negligence claim against Palmerton and ordinary negligence claims against all the defendants. Plaintiff also asserted that his ordinary negligence claim was in avoidance of governmental immunity under the motor vehicle exception to governmental immunity, MCL 691.1405, and further that Roscommon County was not engaged in a governmental function.
Defendants responded by moving for summary disposition on the grounds of governmental immunity. Defendants principally argued that the airboat was not a motor vehicle, that Stevenson was entitled to absolute immunity as a high-ranking elected official, and that Palmerton had not been grossly negligent. In responding to defendants’ motion, plaintiff argued in part that Palmerton was not acting in the course of his employment at the time of the accident.
After oral argument, the trial court granted summary disposition in favor of each defendant pursuant to MCR 2.116(C)(7). On appeal, plaintiff challenges only the grant of summary disposition to Palmerton and specifically limits the appeal to whether Palmerton was acting in the course of his employment when the accident occurred.
II. STANDARD OF REVIEW
This Court reviews de novo a trial court’s grant of summary disposition under MCR 2.116(C)(7). Oliver v Smith, 290 Mich App 678, 683; 810 NW2d 57 (2010). In reviewing a motion for summary disposition under MCR 2.116(C)(7), a court considers the affidavits, pleadings, and other documentary evidence presented by the parties and accepts the plaintiffs well-pleaded allegations, except those contradicted by documentary evidence, as true. Id. “[T]he substance or content of the supporting proofs must be admissible in evidence.” Maiden v Rozwood, 461 Mich 109, 119; 597 NW2d 817 (1999). The evidence submitted must be considered “in the light most favorable to the opposing party.” MEEMIC Ins Co v DTE Energy Co, 292 Mich App 278, 280; 807 NW2d 407 (2011).
III. COURSE OF EMPLOYMENT
The governmental immunity act, MCL 691.1401 et seq., generally provides immunity from tort claims to governmental agencies engaged in a governmental function, as well as governmental officers, agents, or employees. The relevant statutory provision, MCL 691.1407(2), provides:
Except as otherwise provided in this section, and without regard to the discretionary or ministerial nature of the conduct in question, each officer and employee of a governmental agency, each volunteer acting on behalf of a governmental agency, and each member of a board, council, commission, or statutorily created task force of a governmental agency is immune from tort liability for an injury to a person or damage to property caused by the officer, employee, or member while in the course of employment or service or caused by the volunteer while acting on behalf of a governmental agency if all of the following are met:
(a) The officer, employee, member, or volunteer is acting or reasonably believes he or she is acting within the scope of his or her authority.
(b) The governmental agency is engaged in the exercise or discharge of a governmental function.
(c) The officer’s, employee’s, member’s, or volunteer’s conduct does not amount to gross negligence that is the proximate cause of the injury or damage.
Although there was some discussion before the trial court about whether Palmerton was a volunteer under the statute, neither party argues on appeal that Palmerton was a volunteer for purposes of governmental immunity. Instead, plaintiff presents a very narrow argument: that Palmerton was not acting in the course of his employment with the Roscommon County Sheriffs Department when the accident occurred. The trial court found that “at the point in time when he operated the airboat in question, [Palmerton] undertook that act during the course of his employment.” The trial court further found that Palmerton “was acting within the scope of his authority,” or reasonably believed that he was so acting, at the time of the accident.
This Court and our Supreme Court have often conflated the “course of employment” and “scope of his or her authority” requirements of MCL 691.1407(2). Backus v Kauffman (On Rehearing), 238 Mich App 402, 406; 605 NW2d 690 (1999). However, this “does not mean. . . that our courts have concluded that the ‘course of employment’ and ‘scope of his or her authority’ requirements are coextensive.” Id. at 407. Such a conclusion would, in fact, violate the rule of statutory construction that cautions courts to avoid construing statutory provisions so as to render portions of the statute surplusage. Id. Rather, courts tend to follow this approach when “the question whether the two requirements have been satisfied is easily disposed of.” Id.
Plaintiff specifically limits his claim of error to the trial court’s finding that Palmerton was acting in the course of his employment, not whether he was acting or reasonably believed he was acting within the scope of his authority. Plaintiff is correct that, absent a finding of “course of employment,” a court would have no need to reach MCL 691.1407(2)(a). The plain language of the statute applies subdivisions (a) through (c) only to an “officer, employee, or member while in the course of employment or service” or a “volunteer while acting on behalf of a governmental agency.” MCL 691.1407(2). Clear statutory language must be enforced as written. Velez v Tuma, 492 Mich 1,16-17; 821 NW2d 432 (2012).
The necessary considerations for a course of employment are (1) the existence of an employment relationship, (2) the circumstances of the work environment created by the employment relationship, including the “temporal and spatial boundaries established,” and (3) “the notion that the act in question was undertaken in furtherance of the employer’s purpose.” Backus, 238 Mich App at 407-408, citing, among other authorities, 2 Restatement Agency, 2d, §§ 228(1)(b) and (c), 233-235, pp 504, 516, 518, 520, and Black’s Law Dictionary (7th ed), p 356.
We conclude that defendant was acting in the course of his employment at the time of the accident. It is undis puted that an employment relationship existed between the Roscommon County Sheriffs Department — a governmental agency — and Palmerton.
Further, the circumstances of the work environment created by the employment relationship encompassed Palmerton’s act of giving airboat rides at Winterfest. Although Winterfest was perhaps not within the typical “temporal and spatial boundaries” of Palmerton’s employment, it is undisputed that his employer requested that qualified deputies provide airboat rides to the public that day as part of the public relations activities of the sheriffs department. Relevant to this factor is whether the employee is “performing work assigned by the employer or engaging in a course of conduct subject to the employer’s control.” See 2 Restatement Agency, 3d, § 7.07(2), p 198. We conclude that Palmerton was. Further, had Palmerton not been in an employment relationship with the sheriffs department, he would not have been driving the airboat at the time of the accident. “An injury arises out of the course of employment when it occurs as a circumstance of or incident to the employment relationship.” Calovecchi v Michigan, 223 Mich App 349, 352; 566 NW2d 40 (1997), aff d 461 Mich 616 (2000). For these reasons, we hold that Palmerton’s operation of the airboat to give rides to members of the public was within the circumstances of the work environment created by his employment relationship.
Finally, the record before this Court demonstrates that Palmerton undertook driving the airboat in furtherance of his employer’s purpose. Palmerton stated that he approached Grieser to see if he needed any assistance with the airboat rides and asked him if he needed help. Further, as a qualified airboat operator, Palmerton had previously been asked by his employer to assist with giving rides at the festival. In fact, Stevenson indicated that he would have preferred to use one of the off-duty deputies rather than Grieser, who was on duty. Additionally, Pahnerton’s deposition testimony supports the inference that Grieser would have given the airboat ride had Palmerton not offered to do so.
We do not find it dispositive that Palmerton was not specifically instructed by his employer to provide air-boat rides that day. Indeed, even if an act is contrary to an employer’s instructions, it may be within the course of employment if “the employee accomplished the act in furtherance, or [in] the interest, of the employer’s business.” Hamed v Wayne Co, 490 Mich 1, 11; 803 NW2d 237 (2011). Further, it is not dispositive that Palmerton was not compensated for his service, as an employee’s gratuitous work may still be within the course of his employment. See 2 Restatement Agency, 3d, § 7.07(3)(b), p 198. We therefore hold that Palmer-ton’s operation of the airboat was in furtherance of his employer’s purpose.
In so holding, we find plaintiffs citation of Saily v 500 Bushel Club, 332 Mich 286; 50 NW2d 781 (1952), unpersuasive. In Saily, the employee in question was explicitly not acting in furtherance of her employer’s purpose when she was attacked by a deer; in addition to being off duty, she was also “not engaged in anything for the benefit of the employer or incident to the employment” and was not, by virtue of her employment, “exposed to greater hazards of attacks by the deer than was common to any one happening in that locality for whatever purpose.” Id. at 288-290. As stated, Palmerton’s activity was in furtherance of his employer’s purpose, and he would not have been involved in the accident had he not been in an employ ment relationship with the sheriffs department. Similarly, plaintiffs comparison to the unpublished case of Bukowski v Mich Twp Participating Plan, unpublished opinion per curiam of the Court of Appeals, decided October 18, 2005 (Docket No. 262564), p 3, is unpersuasive because this Court found, under the circumstances of that case, that no benefit had accrued to the plaintiffs employer when the plaintiff was driving to work off duty and was not required to carry his weapon or required to respond to situations requiring police intervention. Thus, this Court found no reason not to apply the general rule that “an employee who is merely driving to work is not considered to be within the scope of his employment.” Id., citing Cambrun v Northwest Sch Dist/Jackson Community Sch (On Remand), 220 Mich App 358, 365; 559 NW2d 370 (1996). Palmerton, although off duty, was not merely driving to work and not merely entertaining himself while off duty, but was assisting Grieser in giving airboat rides in furtherance of his employer’s purpose.
The basis of plaintiffs analogy to Saily and Bukowski is that Palmerton was merely “giving his family a ride” and was not acting in furtherance of his employer’s goals. We disagree. As stated, Palmerton testified that he asked Grieser if he needed help with his task of giving airboat rides to the public. Palmerton eventually gave a ride to not only his own family, but two other children. Palmerton’s relatives were members of the general public, as were the other children. The fact that Palmerton may have been motivated, at least in part, by a desire to give his family a ride on the airboat does not change the fact that the act performed was in furtherance of his employer’s purpose.
Because all the factors elucidated in Backus were met here, we hold that the trial court correctly determined that Palmerton was acting in the course of his employment when the accident occurred.
Affirmed.
SAAD and HOEKSTRA, JJ., concurred with BOONSTRA, P.J.
Under the governmental immunity statute, “ ‘[vlolunteer’ means an individual who is specifically designated as a volunteer and who is acting solely on behalf of a governmental agency.” MCL 691.1401(i). The trial court held that Palmerton did not meet this statutory definition, and that ruling is not contested on appeal.
Unpublished opinions of this Court have no precedential effect, but may be considered persuasive. MCR 7.215(C)(1); Paris Meadows, LLC v City of Kentwood, 287 Mich App 136, 145 n 3; 783 NW2d 133 (2010).
Because plaintiff has expressly limited his appeal to this issue, we need not address other aspects of the trial court’s ruling. See Mich Ed Ass’n v Secretary of State, 280 Mich App 477, 488; 761 NW2d 234 (2008) (stating that this Court will generally limit review to issues set forth in the appellant’s questions presented), affd 489 Mich 194 (2011). We therefore do not disturb the trial court’s holding that Palmerton’s decisions to operate the airboat and his actual operation of the airboat did not constitute gross negligence. We also do not disturb the finding that Palmerton was acting within the scope of his authority, or at least that he reasonably believed he was so acting. Finally, we do not disturb the trial court’s holding that the Roscommon County Sheriffs Department was engaged in a governmental function. In that regard, we note that plaintiff alleged in his complaint that defendants were not engaged in a governmental function. Defendants briefly argued below in their summary disposition motion that “Plaintiff cannot properly dispute that the operation of a police department is a governmental function.” As an addendum to their summary disposition motion, defendants submitted the affidavit of Stevenson, which attested that the airboat was “primarily used for the purpose of ice rescues” and was being used at Winterfest “for the purpose of giving rides to members of the general public,” “[a]s a public relations matter.” While plaintiffs written response to the motion did not address the governmental function issue, the trial court engaged in a colloquy with counsel for the parties specifically on the question of whether public relations was a governmental function of a sheriffs office. The trial court held that it was. On appeal, plaintiff raised only the “course of employment” issue. In response, defendants nonetheless in part argued that plaintiff “cannot properly dispute that the use of the airboat for public relations constitutes a governmental function.” In reply, plaintiff reiterated that the governmental function was “not raised” on appeal and “need not be addressed by this Court.” | [
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PER CURIAM.
In this appeal concerning the requirements of the federal Clean Air Act, petitioners Natural Resources Defense Council and the Sierra Club (petitioners) appeal as of right the circuit court’s order affirming a permit to install issued by respondent Michigan Department of Environmental Quality (the Department), which allows intervening respondent city of Holland’s Board of Public Works (individually and collectively, Holland) to install a new electric generating unit in an existing power plant. Petitioners contend that the circuit court applied the wrong standard of review and that the Department’s decision was not authorized by law. We disagree, and affirm.
I. FACTS
A. BACKGROUND
Holland operates three electric generation plants, one of which is the James DeYoung Generating Station. The DeYoung plant has three active coal-fired electric generating units. In 2006, Holland decided to replace an old boiler in one of the units. In January 2007, Holland petitioned the Department for permits to replace the boiler with a new, circulating fluidized bed boiler. Holland’s application included an analysis that assessed the impact of the various technologies on particulate matter emissions. It determined that, if it used a fabric filter, its emissions would fall below Environmental Protection Agency guidelines.
B. HOLLAND’S ANALYSIS
During the Department’s public comment period, petitioners submitted comments, including an objection that Holland had failed to conduct a “best available control technology” analysis on clean fuels, contrary to federal law. Petitioners requested that Holland analyze “clean fuels” such as wood and biomass.
On August 17, 2009, Holland provided additional information to the Department, including a best available control technology analysis for different types of fuel. The analysis identified six possible fuels that the boiler could burn without significant modification, including biomass (which in turn included wood), petroleum coke or “petcoke,” tire-derived fuel, and varieties of coal. The analysis considered seven specific characteristics for each fuel: heating value, ash content, sulfur content, chroline content, mercury content, fluorine content, and lead content.
Concerning particulate matter, the analysis noted that “[sjome fraction of the volatile organic compounds emitted from the unit will contribute to condensable particulate, which may be higher for the biomass fuels that are more difficult to combust.” It indicated that western sub-bituminous coal has a lower sulfur and mercury content than eastern coal, but that the supply of this coal is limited by long-term contracts. Concerning carbon monoxide, the analysis stated that biomass has a higher moisture content, which is likely to cause increased carbon monoxide formation. The analysis determined that “[w]ith the exception of biomass, increased usage of varying amounts of coal, petcoke, and [tire-derived fuel] is not likely to have an effect on the formation of [carbon monoxide].”
The analysis also compared a variety of technologies, and the effects the technologies would have on various emissions. The analysis ultimately determined that a fabric filter, limestone injection, and the use of fuel to control sulfur oxides would result in the best available control technology.
C. THE MANDAMUS ACTION
In August 2010, the Department denied Holland’s permit application on the grounds that Holland failed to demonstrate that it needed the improvement to meet its projected capacity requirements. In September 2010, Holland sought a writ of mandamus, pursuant to which the circuit court remanded the case to the Department to base its decision on whether the application met the air quality requirements in effect on August 20, 2010. The Department ultimately granted Holland a permit to install.
D. PETITIONERS’ APPEAL IN THE CIRCUIT COURT
In May 2011, petitioners petitioned the circuit court to review the Department’s issuance of the permit on several grounds. Pertinent to this appeal, petitioners contended that Holland failed to comply with the requirements of the Clean Air Act and federal and state regulations. Petitioners asserted that these statutes and regulations required the Department to evaluate clean fuels and consider alternative technologies and that the Department’s analysis of these fuels and technologies was inadequate and flawed.
The circuit court granted Holland’s motion to intervene. At the hearing on the petition, the circuit court commented on the “enormous administrative record” and opined that it could not substitute its judgment for the Department’s as long as the Department’s decision was supported by substantial evidence. The circuit court also determined that the agency’s decision was authorized by law, and it affirmed the Department’s issuance of the permit.
Petitioners now appeal, arguing that (1) the circuit court failed to apply the proper standard of review and (2) the Department’s permit was not authorized by law because the “best available control technology” analysis did not comply with the Clean Air Act.
II. HOLLAND’S JURISDICTIONAL CHALLENGE
A. STANDARD OF REVIEW
We review de novo whether this Court has subject-matter jurisdiction to hear an appeal, because it is a question of law.
B. LEGAL STANDARDS
Statutes and court rules determine the jurisdiction of this Court. The Legislature has provided in MCL 324.5505(8) that “[a]ny person may appeal the issuance or denial by the department of a permit to install... in accordance with [MCL 600.631].” MCL 600.631 in turn provides that
[a]n appeal shall lie from any order, decision, or opinion of any state board, commission, or agency, authorized under the laws of this state to promulgate rules from which an appeal or other judicial review has not otherwise been provided for by law.... Such appeals shall be made in accordance with the rules of the supreme court.
MCR 7.203(A)(1)(a) provides that this Court does not have jurisdiction over an appeal of right from an order of the circuit court issued after an appeal to that court from a tribunal:
(A) Appeal of Right. The court has jurisdiction of an appeal of right filed by an aggrieved party from the following:
(1) A final judgment or final order of the circuit court, or court of claims,. .. except a judgment or order of the circuit court
(a) on appeal from any other court or tribunal.... [Emphasis supplied.]
C. APPLYING THE STANDARDS
Holland argues that this Court does not have subject-matter jurisdiction to hear this appeal because it is from “any other court or tribunal,” and thus MCR 7.203(A)(1)(a) prohibits an appeal of right. We disagree.
Holland primarily relies on the language of the staff comment to MCR 7.203(A)(1)(a), which states: “An appeal from a lower court judgment after review of an agency decision will be by leave only.” (Emphasis added.) However, a staff comment is not part of the court rule and does not bind this Court. Considering only the plain language of MCR 7.203(A)(1)(a), we disagree with Holland’s contention and the staff comment, insofar as it applies to an appeal of right from a circuit court’s order affirming or denying the Department’s decision to issue or decline to issue a permit to install under MCL 324.5505(8). We conclude that we have subject-matter jurisdiction to hear, as an appeal of right, such an appeal.
Under MCR 7.203(A)(1)(a), a party does not have an appeal of right in this Court arising out of an order of a tribunal that was appealed in the circuit court. Therefore, the question is whether the Department is acting as a “tribunal” when issuing or denying a permit to install.
“Tribunals include administrative agencies acting in a judicial or quasi-judicial capacity[.]” However, not all agencies’ actions are taken in a judicial or quasi-judicial capacity. To determine whether an administrative agency’s determination is adjudicatory in nature, courts compare the agency’s procedures to court procedures to determine whether they are similar. Quasi-judicial proceedings include procedural characteristics common to courts, such as a right to a hearing, a right to be represented by counsel, the right to submit exhibits, and the authority to subpoena witnesses and require parties to produce documents.
The hearings in this case were public hearings, not adversarial hearings. Indeed, the Department does not have the statutory authority to hold a contested case hearing concerning a permit to install. There is no indication that interested persons here had the opportunity or right to call witnesses or submit exhibits. The procedures the Department used to determine whether to issue a permit in this case are not at all similar to the procedures that courts use. We conclude, therefore, that the Department was not acting as a “tribunal” when it issued Holland’s permit to install. And we further conclude that MCR 7.203(A)(1)(a) does not apply and that this Court has the jurisdiction to hear this appeal as an appeal of right.
III. THE STANDARD OF REVIEW OF AN AGENCY DECISION NOT SUBJECT TO A CONTESTED CASE HEARING
A. OUR STANDARD OF REVIEW
Whether a circuit court applied the appropriate standard of review is a question of law that this Court reviews de novo.
B. THE CIRCUIT COURT’S STANDARD OF REVIEW
When the agency’s governing statute does not require the agency to conduct a contested case hearing, the circuit court may not review the evidentiary support underlying the agency’s determination.* Judicial review is “ ‘limited in scope to a determination whether the action of the agency was authorized by law.’ ” The agency’s action was not authorized by law if it violated a statute or constitution, exceeded the agency’s statutory authority or jurisdiction, materially prejudiced a party as the result of unlawful procedures, or was arbitrary and capricious. Courts review de novo questions of law, including whether an agency’s action complied with a statute.
C. APPLYING THE STANDARDS
Petitioners contend that the circuit court improperly deferred to the Department, rather than reviewing de novo whether the Department’s decision complied with the Clean Air Act. We conclude that, to the extent that the circuit court erred when reviewing the Department’s decision, its error was harmless.
The circuit court opined that the Department’s “expertise in this particular area of regulation is entitled to due deference.” Read in context, the circuit court’s statement about any deference that would be due to the Department follows its statement that it could not substitute its judgment for that of the Department unless the Department’s decision was not supported by substantial evidence, and precedes its statement that it must “stick to the record that was made.” From the context of its statement, it is clear that whatever deference the circuit court expressed was toward the Department’s interpretation of the evidence.
The circuit court may have erred in this case because there was no contested case hearing, and therefore the circuit court should not have reviewed the record evidence. But the circuit court’s ruling does not indicate that it applied any standard other than the de novo standard when it reviewed whether the Department’s decision was authorized by law. The circuit court ruled as follows:
I think the petitioners have brought up some very interesting points, but I also believe that they’ve failed to carry their burden to prove that [the Department’s] decision was not authorized by the law. I do believe the agency’s decision is authorized by law. I believe it was not arbitrary and capricious.
We are not convinced from this ruling that the circuit court applied an incorrect standard when reaching these conclusions.
This Court will not overturn a circuit court’s order on the basis of a harmless error. A circuit court’s misapplication of the substantial-evidence test in a case in which it only has authority to determine whether the Department’s decision was authorized by law is a harmless error if it properly determined that the agency’s decision was authorized by law. We conclude that this error, if error actually occurred, was harmless because, for reasons we will discuss, the circuit court was correct when it determined that the Department’s decision was authorized by law.
IV REQUIREMENTS OF THE FEDERAL CLEAN AIR ACT
A. STANDARD OF REVIEW
As previously discussed, courts review de novo questions of law, including whether an agency’s action complies with a statute.
We note that resolution of this issue requires us to interpret and apply a federal statute. This Court may review an issue of federal law regarding a federal statute, and interpret federal statutory provisions and regulations. Unless there is a conflict among federal courts, this Court is bound by the holdings of federal courts on federal questions.
B. STATUTORY BACKGROUND
Under the Clean Air Act’s program designed to prevent the significant deterioration of air quality, a major facility that emits air pollution must obtain a permit before it can install a modification. The Michigan Legislature has granted the Department authority to promulgate rules to control air pollution and comply with the Clean Air Act. Michigan’s regulatory scheme, which operates somewhat differently, requires certain facilities to obtain a permit before installing a major modification.
Before issuing a permit, the agency must hold a public hearing at which the public may comment on the proposed facility’s “air quality impact of the major source, alternatives to it, the control technology required, and other appropriate considerations.” The Department must consider these comments when making its decision.
C. BEST AVAILABLE CONTROL TECHNOLOGY
Among other requirements, an analysis of the best available control technology must be conducted and the facility must be “subject to the best available control technology for each pollutant subject to regulation under [chapter 85 of the Act, 42 USC 7401 through 7671q] . .. .” The Clean Air Act defines “best available control technology” as
an emission limitation based on the maximum degree of reduction of each pollutant subject to regulation under [chapter 85 of the Act] emitted from or which results from any major emitting facility, which the permitting authority, on a case-hy-case basis, taking into account energy, environmental, and economic impacts and other costs, determines is achievable for such facility through application of production processes and available methods, systems, and techniques, including fuel cleaning, clean fuels, or treatment or innovative fuel combustion techniques for control of each such pollutant.[ ]
A state’s permitting agency has broad authority to determine what is “maximum” and “achievable.”
D. APPLYING THE STANDARDS
As an initial matter, we note that whether the Department considered clean fuels, or should have considered a specific blend of fuels, is not at issue in this appeal. Petitioners’ contention is that the Department’s decision was not authorized by law because it did not adequately consider fuels. We conclude that the Department did conduct an adequate best available control technology analysis.
Petitioners primarily base their argument on the Department’s failure to follow the “top-down” model of conducting the best available control technology analysis. The “top-down” method supplied in the Environmental Protection Agency’s New Source Review Workshop Manual is a common approach to determining the best available control technology. Under this method, the applicant ranks all available control technologies from best to worst. “The most stringent technology is [the best available control technology] unless the applicant can show that it is not technically feasible, or if energy, environmental, or economic impacts justify a conclusion that it is not achievable.”
However, this method is not mandatory. Because the top-down method is not required by the Clean Air Act, whether the Department complied with or failed to comply with this model does not determine whether the Department’s issuance of the permit was authorized by law.
Considering the discretion afforded to state permitting authorities, the United States Supreme Court has stated that “[o]nly when a state agency’s [best available control technology] determination is ‘not based on a reasoned analysis’ may [the United States Department of Environmental Protection] step in to ensure that the statutory requirements are honored.” This implies— and we conclude — that a reasoned analysis that does take into account the considerations the statute enumerates is statutorily sufficient. Indeed, the type of framework the Department employs to determine the best available control technology is exactly the sort of determination best entrusted to an agency’s expertise.
We conclude that the Department complied with the requirements of the federal Clean Air Act because the analysis provided a reasoned analysis of each type of fuel that the facility could utilize without major modifications. Though “clean fuels” is one of the control methods the Department must consider under the Act, the Act does not generally require a facility to redesign itself to use the cleanest fuels. In this case, the analysis considered every type of fuel the proposed boiler could use, including wood and biomass, which the Sierra Club specifically recommended be analyzed as “clean fuels.” Combined, the analysis considered how this variety of fuels, in combination with other processes, systems, and techniques, affected regulated emissions like particulate matter and carbon monoxide. Because the Department’s analysis included those “clean fuels” that Holland’s plant could use, we conclude that the analysis adequately considered clean fuels under the federal Clean Air Act.
We conclude that the Department’s decision did not violate 42 USC 7479(3) and, therefore, that the permit to install was authorized by law. Accordingly, the trial court properly affirmed the Department’s issuance of the permit.
V CONCLUSIONS
For the reasons we have detailed, we conclude that this Court has subject-matter jurisdiction to hear an appeal of right from the circuit court’s decision to affirm a permit when a party has appealed to the circuit court under MCL 324.5505(8). We also conclude that the circuit court properly determined that the Department’s action was authorized by law, and did not apply an unduly deferential standard when doing so.
We affirm.
Murray, P.J., and Markey and WHITBECK, JJ., concurred.
42 USC 7401 et seq.
Lapeer Co Clerk v Lapeer Circuit Judges, 465 Mich 559, 566; 640 NW2d 567 (2002); Chen v Wayne State Univ, 284 Mich App 172, 191; 771 NW2d 820 (2009).
Const 1963, art 6, § 10; Chen, 284 Mich App at 191.
See People v Petit, 466 Mich 624, 632 n 9; 648 NW2d 193 (2002).
Fort v Detroit, 146 Mich App 499, 503; 381 NW2d 754 (1985).
See Yonder Toorn v Grand Rapids, 132 Mich App 590,597; 348 NW2d 697 (1984).
Nummer v Dep’t of Treasury, 448 Mich 534, 543; 533 NW2d 250 (1995); id. at 558-559 (Mallett, J., dissenting).
See id. at 542-543; id. at 558-559 (Mallett, J., dissenting).
Wolverine Power Supply Coop, Inc v Dep’t of Environmental Quality, 285 Mich App 548, 572; 777 NW2d 1 (2009).
Arthur Land Co, LLC v Otsego Co, 249 Mich App 650, 661-662; 645 NW2d 50 (2002).
Northwestern Nat’l Cas Co v Comm’r of Ins, 231 Mich App 483, 488; 586 NW2d 563 (1998).
Id., quoting Brandon Sch Dist v Mich Ed Special Servs Ass’n, 191 Mich App 257, 263; 477 NW2d 138 (1991).
Id.
Wolverine Power Supply Coop, Inc, 285 Mich App at 554; see also In re Complaint of Rovas against SBC Mich, 482 Mich 90, 100-101; 754 NW2d 259 (2008).
MCR 2.613(A).
See Northwestern Nat’l Cas Co, 231 Mich App at 490-491.
Wolverine Power Supply Coop, Inc, 285 Mich App at 554; see In re Rovas Complaint, 482 Mich at 100.
Woodman v Miesel Sysco Food Co, 254 Mich App 159,165; 657 NW2d 122 (2002).
Id.; Schueler v Weintrob, 360 Mich 621, 633-634; 105 NW2d 42 (1960).
42 USC 7475; 42 USC 7479(2)(C); 42 USC 7411(a)(4) (defining “modification”); Alaska Dep’t of Environmental Conservation v Environmental Protection Agency, 540 US 461, 472; 124 S Ct 983; 157 L Ed 2d 967 (2004).
MCL 324.5512(1)(b).
Mich Admin Code, R 336.2802(3).
Mich Admin Code, R 336.2817(2)(e); see also 42 USC 7475(a)(2), (4).
Mich Admin Code, R 336.2817(2)(f).
42 USC 7475(a)(3), (4); see also Mich Admin Code, R 336.2810(3).
42 USC 7479(3); see also Mich Admin Code, R 336.2801(f).
Alaska Dep’t of Environmental Conservation, 540 US at 485, 490.
Environmental Protection Agency, New Source Review Workshop Manual: Prevention of Significant Deterioration and Nonattainment Area Permitting (October, 1990 draft), available at chttp:// www.epa.gov/NSR/ttnnsr01/gen/wkshpman.pdf> (accessed March 21, 2013).
Alaska Dep’t of Environmental Conservation v United States Environmental Protection Agency, 298 F3d 814, 822 (CA 9, 2002), aff d 540 US 461.
Id.
Id.
Id.
Alaska Dep’t of Environmental Conservation, 450 US at 490.
See Sierra Club v United, States Environmental Protection Agency, 499 F3d 653, 655 (CA 9, 2007). | [
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Per CURIAM.
In this construction lien and unjust enrichment case, plaintiff, Edward Karaus (doing busi ness as Great Lakes Sea Walls), appeals as of right the trial court’s orders granting summary disposition in favor of defendant, Bank of New York Mellon (hereafter Mellon). For the reasons stated in this opinion, we affirm in part and reverse and remand in part for further proceedings consistent with this opinion.
This case revolves around plaintiffs efforts to receive compensation for construction work that he performed on a home owned by Sheldon and Nelly Caref (hereafter the Carefs), and commonly referred to as 1258 Fabun Road, located in Glenn, Michigan (hereafter “the property”). The Carefs purchased the property on March 19, 2004. In May 2004, plaintiff entered into an oral agreement with the Carefs to perform construction work on the property. Plaintiff continued to perform construction work on the property until 2006. Thereafter, between 2006 and 2009, plaintiff performed repair work on the property.
Plaintiff maintains that he was not paid in full for his work, and accordingly, on October 26, 2009, he recorded a construction lien. The claim of lien stated that plaintiff had first provided labor or materials for improvements to the property on May 1, 2004, and that plaintiff had last provided labor or materials on October 26, 2009. The lien stated that the contract amount was $405,000. Plaintiff acknowledged payment of $80,000, and accordingly claimed a construction lien upon the property in the amount of $325,000, plus $500 for the cost of the claim of lien for a total of $325,500 plus interest.
In July 2006, the Carefs refinanced their home loan. To do so, the Carefs borrowed $1,000,000 from Home Loan Corporation. The loan was secured by a mortgage encumbering the property in the same amount. The mortgage was recorded on June 5, 2007. The mortgage was subsequently assigned to Mellon. At the time of the motion hearing, Mellon had not foreclosed on the mortgage.
On September 13, 2010, plaintiff filed a complaint against Mellon, PNC Bank, and the Carefs. The complaint requested foreclosure of plaintiffs construction lien, alleged breach of contract against the Carefs only, and alleged unjust enrichment against all the parties. The Carefs did not respond to the complaint. On February 9, 2011, plaintiff filed a motion for entry of partial default judgment against the Carefs, and on June 2, 2011, the trial court entered an order for default judgment against the Carefs. The default judgment awarded a total of $356,511.73, with interest continuing to accrue, in favor of plaintiff.
On September 30, 2011, Mellon filed a motion for partial summary disposition pursuant to MCR 2.116(0(10) in regard to plaintiffs construction lien claim. In support of its motion, Mellon argued that plaintiffs claim of lien was invalid because plaintiff failed to provide work pursuant to a written contract. Mellon cited MCL 570.1114, which is part of the Construction Lien Act (CLA), MCL 570.1101 et seq., and provides that a contractor does not have a right to a construction lien on an interest in a residential structure unless the work was done pursuant to a written contract conforming to specific statutory requirements. In support of its contention that the property was residential, Mellon attached an affidavit executed by Sheldon Caref in which Sheldon averred that the property is residential, and that he and his wife “resided at the Property at different times between March 19, 2004 and 2009.”
Plaintiff filed a response to Mellon’s motion for partial summary disposition regarding the construction hen claim on October 20,2011. Plaintiff argued that the property was not residential because at the time he was first contacted about performing work on the property, the property was owned by NXS, LLC, (a company that is owned and controlled by Sheldon Caref), and that the property was clearly an investment property. Plaintiff further stated that neither the Carefs nor any person involved with NXS, LLC ever intended to reside on the property. Thus, plaintiff maintained that the property was commercial. In support of his position, plaintiff attached his affidavit disputing the accuracy of the statement in Sheldon Carefs affidavit. Specifically, plaintiff states that the property was not habitable at the time it was purchased by the Carefs and NXS, LLC, and that once the property became habitable it was rented by third parties, and thus was not occupied by the Carefs.
On October 3, 2011, Mellon filed a motion for partial summary disposition pursuant to MCR 2.116(C)(8) and (0(10) in regard to plaintiffs unjust enrichment claim. In support of its claim that summary disposition was proper, Mellon argued that plaintiff could not establish a prima facie case of unjust enrichment because Mellon did not receive a benefit from plaintiff and plaintiff had an adequate remedy at law. Plaintiff filed a brief in response, and argued that Mellon did receive a benefit because, but for plaintiffs improvements to the property, the entire area would have eroded and been uninhabitable. Plaintiff further argued that the legal remedy was not applicable.
The hearing regarding both motions for summary disposition was held on October 28, 2011. The parties presented arguments regarding the construction hen and the unjust enrichment claims. The trial court rendered its decision on the record. Concerning the construction lien claim, the trial court granted summary disposition in favor of Mellon because it concluded that there was no material issue of fact regarding whether the property was residential. The trial court stated that it “accepted] the plaintiffs statement that the Carefs didn’t occupy and use the property as a residence.” However, the trial court found that the property was “occupied and used” by tenants, and that the fact that lessees had occupied and used the property as a residence rendered the property residential for purposes of the CLA. The trial court further noted that the language of the statute does not include a provision exempting residential properties that are only used by lessees. The trial court found that there was no written contract for services, and accordingly, found that Mellon was entitled to summary disposition because a construction hen on residential property is only valid if the work was done pursuant to a written contract. The trial court rejected plaintiffs argument that the letters between himself and the Carefs constituted a written contract, and found that at most it was a proposal from the Carefs to pay a certain amount for specified labor. The trial court further noted that the letters did not satisfy all the statutory requirements set forth in the CLA. Thus, the trial court stated that it was granting summary disposition pursuant to MCR 2.116(C)(8) and (C)(10).
In regard to the unjust enrichment claim, the trial court stated that summary disposition in favor of Mellon was proper because “there was an adequate legal remedy available to [plaintiff] and that finding and conclusion is decisive, pivotal in denying his unjust enrichment claim against [Mellon].” The trial court also stated that there was no “substantial factual foundation” regarding plaintiffs claim that the bank has been enriched. The trial court further elaborated, stating that it was granting summary disposition pursuant to MCR 2.116(C)(8) and (0(10) on the unjust enrichment claim because there was no material issue of fact regarding whether the bank was enriched because the bank and the Carefs did not “stand in the same position.”
After the trial court issued its opinions granting Mellon’s motions for summary disposition, plaintiff filed two motions for reconsideration, one addressing the trial court’s decision on the construction lien claim and one addressing the trial court’s decision on the unjust enrichment claim. Relevant to the issues on appeal in this case, plaintiff attached several additional exhibits to support his claim that the property was commercial, not residential, to his motion for reconsideration in regard to the commercial lien claim. These additional exhibits consisted of affidavits from Norman Fautz, Diana Decker, and Donald Karaus, as well as an excerpt from the Saugatuck/Douglas Visitor’s Guide. The visitor’s guide showed a photograph of the deck built by plaintiff, ostensibly as part of an advertisement for rental properties. All three of the affiants stated that Sheldon Caref expressed a desire to “flip” the property and make a profit. The affiants further all indicated that the property was an investment property, and indicated that Sheldon never expressed any intent to reside at the property. The trial court denied plaintiffs motions for reconsideration, finding that plaintiff had presented the same issues already ruled on by the court and that plaintiff had failed to demonstrate a palpable error by which the court and parties were misled in regard to both motions.
On appeal, plaintiff first argues that the trial court erred by granting summary disposition in favor of Mellon because the property at issue is not residential. We agree that the trial court erred, because fact questions exist that preclude summary disposition.
We review de novo a trial court’s decision to grant summary disposition. Coblentz v City of Novi, 475 Mich 558, 567; 719 NW2d 73 (2006). Summary disposition pursuant to MCR 2.116(C)(10) tests the factual support for a claim based on the affidavits, pleadings, depositions, admissions, and other evidence submitted by the parties. Id. The evidence is viewed in the light most favorable to the nonmoving party. Id. at 567-568. “Where the proffered evidence fails to establish a genuine issue regarding any material fact, the moving party is entitled to judgment as a matter of law.” Maiden v Rozwood, 461 Mich 109, 120; 597 NW2d 817 (1999). Summary disposition pursuant to MCR 2.116(C)(8) is proper if the nonmoving party failed to state a claim on which relief can be granted. Kuznar v Raksha Corp, 481 Mich 169, 176; 750 NW2d 121 (2008). Claims must be “so clearly unenforceable as a matter of law that no factual development could possibly justify recovery.” Id. (quotation marks and citation omitted). In reviewing a trial court’s decision to grant summary disposition pursuant to MCR 2.116(C)(8), we review the pleadings alone, accepting all factual allegations in the complaint as true and construing them in a light most favorable to the nonmoving party. Id.
When a party moves the trial court for summary disposition pursuant to MCR 2.116(0(10), the “moving party must specifically identify the matters that it believes have no disputed factual issues.” St Clair Med, PC v Borgiel, 270 Mich App 260, 264; 715 NW2d 914 (2006); MCR 2.116(G)(4). “The moving party must support its position with affidavits, depositions, admissions, or other documentary evidence.” Borgiel, 270 Mich App at 264. If the moving party meets its burden of supporting its position that there is no factual dispute in regard to any relevant matter, the burden shifts to the opposing party to show that a genuine issue of material fact exists. Id. The opposing party must support its position with substantively admissible evidence proffered in opposition to the motion. Maiden, 461 Mich at 121. A “mere promise” that a claim may be supported by evidence produced at trial is insufficient to avoid summary disposition under MCR 2.116(C)(10). Id.
We also review de novo issues of statutory interpretation. Krohn v Home-Owners Ins Co, 490 Mich 145, 155; 802 NW2d 281 (2011). The goal of statutory interpretation is to discern the intent of the Legislature by examining the plain language of the statute. Driver v Naini, 490 Mich 239, 246-247; 802 NW2d 311 (2011). If the language of the statute is clear and unambiguous, the Legislature is presumed to have intended the meaning plainly expressed, and judicial construction is not permitted. Id. at 247. “It is well settled that the CLA is remedial in nature, and ‘shall be liberally construed to secure the beneficial results, intents, and purposes of [the] act.’ ” DLF Trucking Inc v Bach, 268 Mich App 306, 311; 707 NW2d 606 (2005), quoting MCL 570.1302(1). “Substantial compliance with the provisions of [the CLA] shall be sufficient for the validity of the construction liens provided for in [the CLA], and to give jurisdiction to the court to enforce them.” MCL 570.1302(1). “[T]he CLA was enacted for the dual purposes of (1) protecting the rights of lien claimants to payment for expenses and (2) protecting property owners from paying twice for these expenses.” Bach, 268 Mich App at 311.
Relevant in this case, the CLA limits a contractor’s right to a construction lien in regard to work performed on residential structures. MCL 570.1114 provides:
A contractor does not have a right to a construction lien on the interest of an owner or lessee in a residential structure unless the contractor has provided an improvement to the residential structure pursuant to a written contract between the owner or lessee and the contractor and any amendments or additions to the contract are also in writing. The contract required by this section shall contain a statement, in type no smaller than that of the body of the contract, stating all of the following:
(a) That a residential builder or a residential maintenance and alteration contractor is required to be licensed under article 24 of the occupational code, 1980 PA 299, MCL 339.2401 to 339.2412. That an electrician is required to be licensed under the electrical administrative act, 1956 PA 217, MCL 338.881 to 338.892. That a plumbing contrac tor is required to be licensed under the state plumbing act, 2002 PA 733, MCL 338.3511 to 338.3569. That a mechanical contractor is required to be licensed under the Forbes mechanical contractors act, 1984 PA 192, MCL 338.971 to 338.988.
(b) If the contractor is required to be licensed to provide the contracted improvement, that the contractor is licensed and the contractor’s license number.
Thus, to have a valid construction lien for work performed on residential structures, contractors must have performed those improvements pursuant to a written contract that satisfies the statutory requirements. “Residential structure” is defined by the CLA, MCL 570.1106(3), as “an individual residential condominium unit or a residential building containing not more than 2 residential units, the land on which it is or will be located, and all appurtenances, in which the owner or lessee contracting for the improvement is residing or will reside upon completion of the improvement.”
This Court has not addressed the scope of the CLA’s definition of “residential structure” in a situation analogous to this one. This Court has previously concluded that property owned by a building company was a “residential structure” despite the fact that the building company did not intend to reside on the property upon completion of a home being built on the property because a third party (the Johanneses) contracted with the building company to have a home built for them to reside in on the property. Kitchen Suppliers, Inc v Erb Lumber Co, 176 Mich App 602, 605, 608-609; 440 NW2d 50 (1989). This Court explained that the property was residential as defined by the CLA despite the fact that the building company that owned the property did not intend to reside on the property because the Johanneses, “by virtue of their executory contract with [the building company] to purchase the property upon completion of the house, were ‘lessees’ as defined by the [CLA].” Id. at 609. This Court held that the house was a “residential structure” as defined by the CLA because “the Johanneses intended to, and did, reside in the house upon its completion.” Id.
In Titanus Cement Wall Co, Inc v Watson, 158 Mich App 210, 217; 405 NW2d 132 (1987), this Court held that a single family residence was not a residential structure within the meaning of the CLA because the owner who contracted for the improvements to the home did not intend to reside in it upon its completion. This Court noted that it did not matter that a single family home would ordinarily be considered a residential structure because the statute’s definition superseded the dictionary definition. Id.
Thus, on the basis of the plain language of the statute and this Court’s interpretation and application of the CLA’s definition of residential structure, the determining factor in regard to whether a property constitutes a residential structure or a commercial property is whether the owner or lessee contracting for the improvement intends to actually reside on the property on completion of construction. Kitchen Suppliers, 176 Mich App at 609; Titanus Cement Wall Co, Inc, 158 Mich App at 217. Thus, intent to reside in a structure is a prerequisite to that structure being a residential structure for purposes of the CLA.
In this case, the trial court found that there was no material issue of fact regarding whether the property was residential. The trial court stated that it “accepted] plaintiffs statement that the Carefs didn’t occupy and use the property as a residence.” However, the trial court found that the property was “occupied and used” by tenants, and that pursuant to this Court’s decision in Kitchen Suppliers, the fact that lessees occupied and used the property as a residence rendered the property residential for purposes of the CLA.
We conclude that the trial court erred by granting summary disposition because there is a genuine issue of material fact in regard to whether the Carefs intended to or did reside on the property. Mellon, the moving party, presented an affidavit executed by Sheldon Caref wherein he stated that he and his wife “resided at the property at different times between March 19, 2004 and 2009” in support of its contention that the property is a “residential structure.” Plaintiff, the opposing party, responded with an affidavit of his own stating that as soon as the property was habitable, the Carefs rented it out. Plaintiff further averred that the property was purchased by a company, and that it clearly appeared to be an investment property. Thus, plaintiff rebutted Mellon’s evidence of the Carefs intent to reside in the property with evidence suggesting that the Carefs did not reside in the property, and in doing so established that there was a genuine issue of material fact for trial in regard to the Carefs intended use of the property. Maiden, 461 Mich at 121; Borgiel, 270 Mich App at 264.
The fact that there is a genuine issue of material fact is further underscored by the trial court’s conclusion that it “accepted] plaintiffs statement that the Carefs didn’t occupy and use the property as a residence.” The trial court engaged in impermissible fact-finding when it concluded that the Carefs did not occupy and use the property as a residence. Further, the trial court’s reason for granting summary disposition in favor of Mellon despite its finding that the property was never occupied by the Carefs, was a misapplication of the law. The trial court concluded that summary disposition in favor of Mellon was required even though it had found that the Carefs never resided in the property. Relying on this Court’s decision in Kitchen Suppliers, the Court concluded that because the lessees occupied and used the property as a residence, the property qualified as residential for purposes of the CLA. However, contrary to the trial court’s decision, the Kitchen Suppliers case did not hold that a property is residential if it is occupied by lessees who use it as a residence. Rather, as discussed earlier, the Kitchen Suppliers case held that property owned by a company that did not intend to reside in the property still qualified as residential under the CLA because the company had a contract with a third party who in turn had contracted with the property owner to have a home built on the property in which the third party intended to reside. Thus, unlike this case, the third-party “lessees” in Kitchen Suppliers contracted for improvement to the property and intended to permanently reside on the property upon completion of the contracted-for improvements.
Next, plaintiff argues that the trial court erred by ruling that he failed to establish a prima facie case of unjust enrichment and also that the trial court erred by determining that plaintiffs unjust enrichment claim was barred because he had an adequate legal remedy.
Whether a claim for unjust enrichment can be maintained is a question of law that we review de novo. Morris Pumps v Centerline Piping, Inc, 273 Mich App 187, 193; 729 NW2d 898 (2006). Trial court rulings regarding equitable matters are also reviewed de novo. Id.
A claim of unjust enrichment requires the complaining party to establish (1) the receipt of a benefit by the other party from the complaining party and (2) an inequity resulting to the complaining party because of the retention of the benefit by the other party. Id. at
195. If plaintiff in this case can establish that Mellon has been unjustly or inequitably enriched at its expense, the law will imply a contract to prevent the unjust enrichment. Id. Not all enrichment is unjust in nature, and the key to determining whether enrichment is unjust is determining whether a party unjustly received and retained an independent benefit. Id. at 196.
“One is not unjustly enriched ... by retaining benefits involuntarily acquired which law and equity give him absolutely without any obligation on his part to make restitution.” Tkachik v Mandeville, 487 Mich 38, 48; 790 NW2d 260 (2010) (quotation marks omitted), quoting Buell v Orion State Bank, 327 Mich 43, 56; 41 NW2d 472 (1950). Our Supreme Court explained that unjust enrichment describes “the result or effect of a failure to make restitution of or for property or benefits received under such circumstances as to give rise to a legal or equitable obligation to account therefor.” Buell, 327 Mich at 56 (quotation marks and citation omitted).
An examination of the elements of unjust enrichment is dispositive of whether plaintiff has established his unjust enrichment claim. Again, in order to establish a claim of unjust enrichment, plaintiff must demonstrate: (1) the receipt of a benefit by the other party from the complaining party and (2) an inequity resulting to the complaining party because of the retention of the benefit by the other party. Morris Pumps, 273 Mich App at 195. Turning to the first element, plaintiff has not shown that he conferred a benefit to Mellon, because Mellon acquired its interest in the property through the assignment of the mortgage executed by the Carefs, not through any action of plaintiff. Thus, there was no receipt of a benefit by Mellon from plaintiff. As stated by this Court in Morris Pumps, 273 Mich App at 196, quoting 66 Am Jur 2d, Restitution and Implied Contracts, § 32, p 628:
A third party is not unjustly enriched when it receives a benefit from a contract between two other parties, where the party benefited has not requested the benefit or misled the other parties .... Otherwise stated, the mere fact that a third person benefits from a contract between two other persons does not make such third person liable in quasi-contract, unjust enrichment, or restitution. Moreover, where a third person benefits from a contract entered into between two other persons, in the absence of some misleading act by the third person, the mere failure of performance by one of the contracting parties does not give rise to a right of restitution against the third person.
Therefore, we conclude that Mellon has not received a benefit from plaintiff because if anything, Mellon has merely received the benefit from the contract between plaintiff and the Carefs.
Turning to the second element, to the extent that Mellon has retained a benefit from the work plaintiff performed on the property, it received that benefit only as a third party to the agreement between plaintiff and the Carefs. There is no allegation or evidence to support the contention that Mellon requested any of the work performed by plaintiff or misled plaintiff to receive any benefit. Further, there is no evidence that Mellon ever gave any assurance that it would pay for the work completed by plaintiff, nor that it was even aware of the work as it was being performed. In light of the fact that Mellon was completely uninvolved with any negotiations that had occurred before the work on the property was commenced, it cannot be said that any benefit Mellon does retain is unjust. Further, it is not clear that Mellon has even benefitted from plaintiffs labor be cause Mellon has not yet foreclosed on the property and merely retains a mortgage interest. Therefore, the trial court properly granted summary disposition in favor of Mellon in regard to plaintiffs unjust enrichment claim.
Affirmed in part and reversed and remanded in part for further proceedings consistent with this opinion. We do not retain jurisdiction.
HOEKSTRA, P.J., and BORRELLO and BOONSTRA, JJ., concurred.
All the claims against PNC Bank have been resolved, and PNC Bank is not a party to this appeal.
We note that Mellon argues that several exhibits submitted by plaintiff on appeal should'not be considered by this Court in determining whether the trial court properly granted summary disposition in favor of Mellon because those exhibits were not presented to the trial court at the time of the hearing on Mellon’s motions for summary disposition and were instead submitted only with plaintiff’s motion for reconsideration. Mellon is correct that this Court’s review of a trial court’s decision on a motion for summary disposition is limited to the evidence that was presented to the trial court at the time the motion was decided. Innovative Adult Foster Care, Inc v Ragin, 285 Mich App 466, 475-476; 776 NW2d 398 (2009). Thus, we will not consider any evidence submitted on appeal that was not before the trial court at the time of the motion hearing. We note that on appeal plaintiff does not challenge the trial court’s denial of its motion for reconsideration.
MCR 2.116(G)(4) provides:
A motion under subrule (C)(10) must specifically identify the issues as to which the moving party believes there is no genuine issue as to any material fact. When a motion under subrule (C)(10) is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his or her pleading, but must, by affidavits or as otherwise provided in this rule, set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, judgment, if appropriate, shall be entered against him or her.
Lessee is defined as “a person, other than the owner, who holds an interest, other than a security interest, in real property.” MCL 570.1105(1).
In light of our conclusion that Mellon was not unjustly enriched by plaintiff, we need not consider whether plaintiff lacks an adequate legal remedy because Mellon is not liable to plaintiff regardless of whether plaintiffs legal remedy is adequate. | [
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Per Curiam.
Plaintiff appeals by leave granted the circuit court order affirming the district court order that granted summary disposition to defendants on the ground that plaintiff’s claim for rent was barred by accord and satisfaction. We affirm.
Plaintiff leased commercial premises to defendants, the owners and operators of a pharmacy. Plaintiff acquired the lease, which ran through December 1997, by assignment. After plaintiff acquired the leased premises, plaintiff and defendants were unable to come to an agreement regarding the terms for its long-term availability to defendants. In June 1996, defendants decided to buy another site for their pharmacy and gave plaintiff notice of their intent to move by the end of the year. Defendants moved to the new site and vacated the leased premises in December 1996. Over a period of months after moving, defendants sent four payments to plaintiffs management company, McCarthy-Tomga Management, Inc. (McCarthy-Tomga), in the amount of the monthly rent on the vacated premises ($2,819.65). In March 1997, plaintiff began renovating a space adjacent to defendants’ leased premises that involved a portion of defendants’ space. At some point thereafter, McCarthyTomga informed defendants that they would receive a $970 credit for the square footage utilized.
In June 1998, defendants sent plaintiff a letter offering $2,819.65 as “full and final resolution of any and all rental claims which the landlord has against the tenant.” Defendants asserted that a number of potential tenants referred to McCarthy-Tomga by defendants were “discouraged” by the short-term leases plaintiff offered, as well as the fact that they would be responsible for their own remodeling. Defendants also noted their “discovery” in March 1997 of plaintiffs’ renovation activities. Defendants characterized plaintiff’s actions as inconsistent “with the landlords’ good faith responsibility to mitigate damages and/or to have the entire premises of our space available to a new tenant.” Defendants further stated that “there is a fair argument that the Church’s renovation activities (for it’s [sic] own use) effectively terminated our lease in March 1997.” Defendants stated that the enclosed check brought their rent current through June 1, 1997, or one year from the date on which they had first given plaintiff notice of their intention to vacate. Defendants opined that one year gave plaintiff “ample opportunity to rent that space had [plaintiff] been ‘acting in good faith.’ ”
Defendants sent a copy of the letter to McCarthyTomga with a check in the amount of $2,819.65, payable to plaintiff. A McCarthy-Tomga employee deposited the check in plaintiff’s account. The following month, McCarthy-Tomga sent a letter to defendants informing them that plaintiff did not accept defendants’ check as full settlement of plaintiff’s rent claims. Plaintiff did not, however, return the check.
In November 1998, plaintiff filed suit in the district court to recover the seven months’ rent it claimed was still owed under the lease. In December 1998, defendants filed a counterclaim seeking reimbursement for rent paid during the period of renovation when, defendants alleged, plaintiff was in constructive possession of the premises. Defendants also filed a motion for summary disposition pursuant to MCR 2.116(C)(7) and (8), claiming that plaintiff’s negotiation of the June 1998 check established an accord and satisfaction and plaintiff’s failure to tender back that payment barred its suit. After a hearing on the matter, the district court granted defendants’ motion. The court found that the letter sent to plaintiff with the check showed that there existed a good-faith dispute regarding the rent owed and that plaintiff’s claim was, therefore, unliquidated. The court further found that plaintiff’s retention of the proceeds of the check after it became aware of “the import of the accompanying letter” constituted acceptance of the offered settlement and barred plaintiff from bringing suit. After the district court denied plaintiff’s motion for reconsideration, plaintiff filed an appeal to the circuit court. The circuit court affirmed the district court’s order.
Plaintiff argues on appeal that the circuit court erred in affirming the district court’s grant of summary disposition under MCR 2.116(C)(7) on the basis that defendants’ offer and payment and plaintiff’s acceptance and retention of the payment constituted an accord and satisfaction, and plaintiff’s failure to tender back the amount paid barred its suit. Specifically, plaintiff argues that defendants did not establish a valid accord and satisfaction and, in any event, under Nationwide Mut Ins Co v Quality Builders, Inc, 192 Mich App 643; 482 NW2d 474 (1992), plaintiff was not required to tender back the payment before filing suit for the balance of its rent claim.
We review de novo a trial court’s grant of summary disposition pursuant to MCR 2.116(C)(7) to determine whether the defendant is entitled to judgment as a matter of law. O’Connell v Kellogg Community College, 244 Mich App 723, 725; 625 NW2d 126 (2001).
We address first whether the district and circuit courts erred in determining that defendants’ offer and payment and plaintiff’s acceptance and retention of the payment constituted an accord and satisfaction. Accord and satisfaction is an affirmative defense. Nationwide, supra at 646. An “accord” is an agreement between parties to give and accept, in settlement of a claim or previous agreement, something other than that which is claimed to be due, and “satisfaction” is the performance or execution of the new agreement. Id. To prove the existence of an accord and satisfaction, a defendant must show (1) its good-faith dispute of (2) an unliquidated claim of the plaintiff, (3) its conditional tender of money in satisfaction of the claim, and (4) the plaintiffs acceptance of the tender (5) while fully informed of the condition. Id. at 647. A defendant need not show a plaintiff’s express acceptance of the condition; rather, the law of accord and satisfaction is that where a creditor accepts a conditional tender, the creditor also agrees to the condition. Id. However, the expression of the condition must be “clear, full, and explicit.” Id., quoting Durkin v Everhot Heater Co, 266 Mich 508, 513; 254 NW 187 (1934).
First, defendants’ June 1997 letter to plaintiff established their good-faith dispute regarding the rent defendants owed plaintiff. Defendants made clear that they disputed whether plaintiff had acted in good faith in its efforts to obtain replacement tenants or mitigate damages, and also disputed whether they owed rent on the premises after plaintiff began its renovation activities. Plaintiff contends, however, that even if defendants established a good-faith dispute, they did not show that plaintiff’s claim was unliquidated. Plaintiff maintains that because there was a written lease for a fixed term and a fixed amount, and it had agreed to credit defendants a certain amount for the square footage affected by the renovations, its claim was liquidated and therefore could not be the subject of an accord and satisfaction. We do not find plaintiff’s distinction between “disputed” and “unliquidated” persuasive.
Under the law of accord and satisfaction, the term “liquidated” generally refers to a claim which the debtor does not in good faith dispute — a claim which is certain as to what, and how much, is due. A claim is not liquidated even if it appears that something is due, unless it appears how much is due. A liquidated claim is one which can be determined with exactness from the agreement between the parties, or by arithmetical process, or by the application of definite rules of law. [1 Am Jur 2d, Accord and Satisfaction, § 7, p 474.]
Here, plaintiff’s position was that defendants owed rent for the entire contractual period. Defendants’ position, in part, was that they did not owe any rent after March 1997, when plaintiff began its renovations, and that in paying through May 1997, they were offering more than they actually owed. Further, defendants filed a counterclaim seeking reimbursement for rent paid during the period of renovation when, defendants alleged, plaintiff was in constructive possession of the premises. See 1 Am Jur 2d, Accord and Satisfaction, § 8, p 475. Because there existed a good-faith dispute regarding the amount of rent due, we conclude that plaintiff’s claim was disputed and unliquidated, and therefore could be the subject of an accord and satisfaction.
We further conclude that the condition accompanying the tender of payment, as expressed in defendants’ letter, was clear and unequivocal. Defendants stated that the check was “offered in full and final resolution of any and all rental claims which the landlord has against the tenant ... or the tenant has against the landlord with respect to the rental agreement pertaining to 1115 E. Front Street.” Plaintiff contends that because an employee of McCarthy-Tomga deposited the check without authorization from plain tiff, plaintiff may not be charged with having accepted the payment with knowledge of the condition. This argument is irrelevant in light of the fact that plaintiff retained the proceeds of the check after learning of the condition. See Hutton v Roberts, 182 Mich App 153, 162; 451 NW2d 536 (1989). Plaintiff further contends that because its letter to defendants explicitly stated that it did not accept the condition, an accord and satisfaction was not established. However, plaintiffs letter indicates that it clearly understood the condition on which defendants made the payment, and plaintiffs assertion that it could accept the payment, but not the condition, is contrary to Shaw v United Motors Products Co, 239 Mich 194; 214 NW 100 (1954), where the Michigan Supreme Court stated:
The applicable rule of law is, if the tender is in full satisfaction of an unliquidated claim, the amount of which is in good faith disputed by the debtor, and the creditor is fully informed of the condition accompanying acceptance, an accord and satisfaction is accomplished if the money so tendered is retained; for there can be no severance of the condition from acceptance and it avails the creditor nothing to protest and notify the debtor that the amount tendered is credited on the claims and not accepted in full satisfaction. [Id. at 196.]
The Shaw Court explained that the rule “is based upon the condition accompanying the tender and consequent acceptance of the condition in retaining the money. This required no previous agreement, but rests upon a dispute as to the amount due.” Id. at 195-196; see also DMI Design & Mfg, Inc v Adac Plastics, Inc, 165 Mich App 205, 210-211; 418 NW2d 386 (1987); Fuller v Integrated Metal Technology, Inc, 154 Mich App 601, 607; 397 NW2d 846 (1986). We conclude, therefore, that the circuit court did not err in finding that the parties reached an accord and satisfaction in this case.
Plaintiff next contends that even if an accord and satisfaction was established, under Nationwide, supra, it was not required to tender back the payment made by defendants before it could file suit for the balance of its rent claim. In Nationwide, this Court found that the defendant failed, as a matter of law, to show an effective accord and satisfaction and that “because no accord and satisfaction has been shown, plaintiff was not required to tender the check before bringing this action.” Id. at 651. This Court then stated that
it is doubtful that such tender is required where a plaintiff seeks to avoid a valid accord and satisfaction and recover the full amount of the original claim .... To the extent that such a requirement may be imposed by Melick v Nauman Vandersoort, Inc, 54 Mich App 171, 179; 220 NW2d 748 (1974), rev’d on other grounds 393 Mich 774 (1974), we think that Melick was wrongly decided. [Id. (emphasis in original).]
In Melick, this Court held that the plaintiffs were precluded from challenging the validity of the accord and satisfaction raised as a defense in that case because the plaintiffs never tendered back to the defendant the payments made by the defendant pursuant to the alleged accord and satisfaction. Melick, supra at 179.
We conclude that the district and circuit courts in this case were not bound by the statements made in Nationwide regarding tender back in the context of an accord and satisfaction. Because no accord and satisfaction was established in Nationwide, it was unnecessary for this Court to decide whether the plaintiff was required to tender back the check and whether the holding in Melick with regard to tender back was correct. It is a “well-settled rule that statements concerning a principle of law not essential to determination of the case are obiter dictum and lack the force of an adjudication.” Roberts v Auto-Owners Ins Co, 422 Mich 594, 597-598; 374 NW2d 905 (1985). Accordingly, Nationwide does not require reversal of the decisions of the lower courts in this case.
However, in light of the confusion apparently occasioned by the dicta in Nationwide, we take this opportunity to clarify the rule regarding tender back of payments where an accord and satisfaction is established. Although the Michigan Supreme Court has never squarely addressed the issue whether tender back is required before commencing suit when there exists a valid accord and satisfaction, the language of Lehaney v New York Life Ins Co, 307 Mich 125, 131; 11 NW2d 830 (1943), where the Court addressed the validity of an accord and satisfaction, indicates that is the case. In Lehaney, id., the Supreme Court explained that where there exists a bona fide dispute regarding a claim, “[a]djustment of such controversies should be looked upon with favor and the law does not permit the claimant to accept and retain the money which has been tendered by way of settlement and subsequently litigate with the debtor for the recovery of a greater sum.” (Emphasis added.) As the Nationwide Court noted, the case relied on by the Melick Court, Chapman v Ross, 47 Mich App 201; 209 NW2d 288 (1973), addressed whether tender back is required where a party seeks to rescind a written release, not where it seeks to avoid an accord and satisfaction. However, the Lehaney Court’s language indicates that the policy considerations underlying the rule with regard to written releases apply as well in the context of accord and satisfaction. “[T]he law favors settlements,” and “[a] party entering into a settlement agreement, offering adequate consideration, is entitled to rely on the terms of the agreement.” Stefanac v Cranbrook Educational Community (After Remand), 435 Mich 155, 163; 458 NW2d 56 (1990). We conclude, therefore, that tender back of payment is a necessary prerequisite to filing suit where a valid accord and satisfaction is established.
We note that the authorities on which plaintiff relies for its argument that tender back is not a necessary prerequisite to commencing suit are distinguishable from this case because the defendant in each case plaintiff cites was unable to establish an accord and satisfaction. Further, defendants in this case did not pay only that which “both sides acknowledged was due.” Gitre v Kessler Products Co, Inc, 387 Mich 619-624; 198 NW2d 405 (1972); see also 1 Am Jur, Accord and Satisfaction, § 24, p 492 (stating that where “the amount paid in satisfaction is conceded to be due in any event, the creditor does not need to tender back the amount paid prior to bringing an action on the original obligation, because the law will not require a person to pay over a sum which belongs to that person in any event in order for a judgment to be rendered in his or her favor for that very sum”). Here, whether defendants owed plaintiff the money offered in settlement clearly was in dispute.
Where, as here, there is a good-faith dispute of an unliquidated claim and unequivocal language expressing the conditions of a tender offered in settlement of the claim and the plaintiff accepts and retains the tender, that plaintiff is barred by accord and satisfaction from pursuing a claim for the balance of the money it may believe it is owed. Accordingly, the circuit court properly determined that plaintiffs acceptance and retention of defendants’ tender barred plaintiff’s suit, and summary disposition was appropriately granted under MCR 2.116(C)(7).
Affirmed.
Defendants brought the motion under MCR 2.116(C)(7) and (8). Although the circuit court did not indicate under which provision it was granting summary disposition, because the court considered materials outside the pleadings, we will treat the motion as granted under MCR 2.116(C)(7).
See Fritz v Marantette, 404 Mich 329; 273 NW2d 425 (1978) (holding that the defendant was not entitled to summary disposition because there was a jury-submissible question of fact whether the underlying debt was liquidated and whether the amount offered in settlement was only that which both parties conceded was due); Gitre v Kessler Products Co, Inc, 387 Mich 619; 198 NW2d 405 (1972) (holding that an accord and satisfaction did not take place because the defendant had merely paid an existing undisputed claim); Urben v Public Bank, 365 Mich 279; 112 NW2d 444 (1961) (holding that the issue of accord and satisfaction was properly submitted to a jury where there was a question of fact whether the plaintiffs deposit of final paycheck with a notation on the back constituted acceptance of an offered settlement). | [
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] |
Gage, J.
This case involves plaintiffs request for documents under the Freedom of Information Act (foia), MCL 15.231 et seq. Plaintiff sought a circuit court order compelling defendant to provide plaintiff with certain information regarding a criminal investigation of plaintiff. The circuit court granted defendant’s motion for summary disposition of plaintiff’s complaint. Plaintiff appeals as of right. We affirm.
i
Plaintiff currently resides in a state prison in Jackson operated by the Department of Corrections. After a 1995 jmy trial, plaintiff was convicted of first-degree felony murder, MCL 750.316, armed robbery, MCL 750.529, and two counts of possessing a firearm during the commission of a felony, MCL 750.227b. The judgment of sentence ordered that plaintiff serve life imprisonment without parole for the felony-murder conviction, and a consecutive two-year term for the felony-firearm convictions. In October 1997, this Court affirmed plaintiff’s convictions and sentences. People v Proctor, unpublished opinion per curiam of the Court of Appeals, issued October 7, 1997 (Docket No. 188435). The Supreme Court denied plaintiff’s application for leave to appeal his convictions. People v Proctor, 459 Mich 867 (1998).
On June 8, 1998, plaintiff authored a letter to defendant’s chief of police, requesting various documents and information pertaining to defendant’s investigation of plaintiff’s and his accomplice’s participation in the armed robbery and murder of the victim. 234Plaintiff explained in his complaint that he sought the infor mation “to support the issues [he] intends on [sic] raising in his Motion for Relief From Judgment.” On June 15, 1998, defendant’s Lieutenant Edward Harris mailed plaintiff a response denying his requests because he was “not entitled to information .... pursuant to MCL 15.231 [(2)].” On June 18, 1998, plaintiff prepared a letter to Lieutenant Harris appealing the rejection of his request as an unconstitutional “denial of equal protection of law, as well as a due process violation.” On June 25, 1998, Lieutenant Harris reiterated his denial of plaintiff’s request for information, citing MCL 15.231(2) and 15.232(c).
On January 25, 1999, plaintiff filed the instant suit requesting that the circuit court order defendant’s immediate disclosure of the information plaintiff requested. Plaintiff contended that (1) he had exhausted efforts to obtain the requested information elsewhere, and that consequently he possessed an exceptional need for the information to assist his preparation of his motion for relief from judgment, and (2) he unconstitutionally was deprived of a fair and neutral decisionmaker with respect to his FOIA requests because Lieutenant Harris, the individual who determined the outcome of plaintiffs requests, acted as the officer in charge of the criminal investigation of plaintiff.
Defendant responded by filing a motion for summary disposition pursuant to MCR 2.116C(8) and (10), arguing that the foia plainly did not apply to incarcerated prisoners like plaintiff. On May 26, 1999, the circuit court issued an opinion and order granting defendant’s motion pursuant to subrule C(8) because plaintiff, a prison inmate, “is not within the class of persons entitled to invoke the foia.”
Plaintiff’s motion for relief from judgment was denied in November 1999.
n
Plaintiff raises on appeal several challenges to the constitutionality of the foia provisions excluding prisoners from the coverage of the act. Although plaintiff failed to raise before the trial court some of his constitutional arguments, and the trial court did not address any constitutional claims, this Court nonetheless may consider these important questions. People v Gezelman (On Rehearing), 202 Mich App 172, 174; 507 NW2d 744 (1993). The constitutionality of a statute is a question of law that we review de novo. Citizens for Uniform Taxation v Northport Public School Dist, 239 Mich App 284, 287; 608 NW2d 480 (2000). We also review de novo the trial court’s summary disposition ruling. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998).
In considering plaintiff’s challenges to the constitutionality of the foia, this Court must adhere to the well-established rule that a statute is presumed con stitutional unless its unconstitutionally is clearly apparent. McDougall v Schanz, 461 Mich 15, 24; 597 NW2d 148 (1999). The party challenging the statute bears the burden of overcoming the presumption of constitutionality. In re AH, 245 Mich App 77, 82; 627 NW2d 33 (2001). That a statute may appear undesirable, unfair, unjust, or inhumane does not of itself render the statute unconstitutional and empower a court to override the Legislature. Doe v Dep’t of Social Services, 439 Mich 650, 681; 487 NW2d 166 (1992). Arguments that a statute is unwise or results in bad policy should be addressed to the Legislature. People v Kirby, 440 Mich 485, 493-494; 487 NW2d 404 (1992).
The foia provisions that plaintiff attacks as unconstitutional state in relevant part as follows:
It is the public policy of this state that all persons, except those persons incarcerated in state or local correctional facilities, are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and public employees, consistent with this act. The people shall be informed so that they may fully participate in the democratic process. [MCL 15.231(2) (emphasis added).]
As used in this act:
(c) “Person” means an individual, corporation, limited liability company, partnership, firm, organization, association, governmental entity, or other legal entity. Person does not include an individual serving a sentence of imprisonment in a state or county correctional facility in this state or any other state, or in a federal correctional facility.[ ] [MCL 15.232 (emphasis added).]
These provisions plainly and unambiguously exclude incarcerated prisoners from the class of persons entitled to obtain public records. Seaton v Wayne Co Prosecutor (On Second Remand), 233 Mich App 313, 315-316; 590 NW2d 598 (1998). The incarcerated prisoner exclusions from coverage under the FOIA clearly intended to put a halt to the mischief and abuse of public resources caused by Michigan’s prisoner population through excessive and largely frivolous foia requests. Id. at 322.
A
Plaintiff first contends that the foia’s prisoner exclusions violate his constitutional guarantees of access to the courts. We agree with plaintiff’s assertions that prisoners possess a due process right of reasonable access to the courts that guarantees them “adequate, effective, and meaningftd” opportunities to present their claims. Bounds v Smith, 430 US 817, 822; 97 S Ct 1491; 52 L Ed 2d 72 (1977); see also Hall v Hall, 128 Mich App 757, 759; 341 NW2d 206 (1983) (“It is well settled that a prisoner has a due process right of reasonable access to the courts.”). However, the principles involving access to the courts that plaintiff cites in his brief on appeal do not support his assertion of a right to inspect defendant’s records pursuant to the foia. All the cases plaintiff cites discuss to what extent prison officials must afford a prisoner access to legal resources, legal assistance, and a route for physically delivering the prisoner’s pleadings to a court. In this case, plaintiff does not contend that he experienced any impediment to conducting legal research to support his motion for relief from judgment or to filing his motion with the court, and we perceive no indication that plaintiff suffered any interference with his fundamental right to an adequate, effective, and meaningful opportunity to present his motion for relief from judgment.
Furthermore, plaintiffs exclusion from seeking public documents under the FOIA does not otherwise implicate plaintiffs constitutional rights. We emphasize that the FOIA provisions themselves are not of constitutional moment. They themselves do not invest plaintiff with a constitutional right to investigate government information.
The foia is a mechanism through which the citizenry may examine and review the workings of government and its executive officials. The statute has in common with the state’s liberal discovery rules that it came into existence as a manifestation of the trend to disclose information that previously had generally been kept secret. The foia embodies this state’s strong public policy favoring public access to government information, recognizing the need that citizens be informed as they exercise their role in a democracy, and the need to hold public officials accountable for the manner in which they discharge their duties. [Messenger v Ingham Co Prosecutor, 232 Mich App 633, 641; 591 NW2d 393 (1998), citing MCL 15.231(2).]
We will not attempt to address the wisdom of the Legislature’s determination to exclude incarcerated prisoners from eligibility to make foia requests for documents, Kirby, supra, but merely note that the right to make an foia request appears to be one of many privileges that a convicted and incarcerated prisoner forfeits through his commission of criminal acts.
Plaintiff seeks to raise a constitutional issue to the extent that he repeatedly submits that the information he seeks from defendant pursuant to the foia is “not contained in the trial court record and not available pursuant to MCR 6.433.” Plaintiff fails to explain, however, why during his trial he could not have had access to, or at least inquired of defendant’s employees regarding, the various documents and information he now seeks pursuant to the foia. Plaintiff makes no suggestion that during his trial he received ineffective assistance of counsel that prevented his development of the record. Nor does plaintiff allege with specificity that during his criminal trial the prosecutor improperly withheld witness statements or other exculpatory information. Plaintiff consistently repeats only his mere speculation to the following effects: “Information that is not contained in the trial court’s records [and] was not introduced at trial . . . was possibly withheld by the police or prosecutor’s office and clearly not available to the prisoner pursuant to MCR 6.433,” and that he seeks only “records, documents and information maintained solely by the White Lake Township Police Department, or possibly the prosecutor’s office and in fact may prove his innocence, and/or obtain him a new trial!” We note that these mere speculations do not establish any constitutional violation.
B
Plaintiff next argues that the FOIA prisoner exclusions are unconstitutionally vague. The “void for vagueness” doctrine is derived from the constitutional guarantee that the state may not deprive a person of life, liberty, or property without due process of law. Petrus v Dickinson Co Bd of Comm’rs, 184 Mich App 282, 299-300; 457 NW2d 359 (1990), citing US Const, Am XIV; Const 1963, art 1, § 17. A statute may qualify as void for vagueness if (1) it is overbroad and impinges on First Amendment freedoms, (2) it does not provide fair notice of the conduct it regulates, or (3) it gives the trier of fact unstructured and unlimited discretion in determining whether the statute has been violated. Ray Twp v B & BS Gun Club, 226 Mich App 724, 732; 575 NW2d 63 (1997). Plaintiff suggests in this case that the FOIA prisoner exclusions contain no standards to guide an FOIA administrator’s determi nation whether to deny a prisoner’s request for information, and thus the exclusions create the risk that the foia administrator may arbitrarily and discriminatorily refuse prisoner requests.
We fail to discern any potentially unconstitutional vagueness within foia subsections 1(2) or 2(c). A statute challenged as void for vagueness, on the basis that it invests a decisionmaker with unbridled discretion, “must provide standards for enforcing and administering the laws in order to ensure that enforcement is not arbitrary or discriminatory; basic policy decisions should not be delegated to policemen, judges, and juries for resolution on an ad hoc and subjective basis.” In re Forfeiture of 719 N Main, 175 Mich App 107, 112-113; 437 NW2d 332 (1989). Subsections 1(2) and 2(c) of the foia plainly delineate which persons are and are not entitled to have access to information regarding government affairs and public officials’ and employees’ official acts. No discretion remains with foia administrators to arbitrarily or discriminatorily deny a prisoner’s request for information because subsections 1(2) and 2(c) unambiguously preclude any and all FOIA requests by incarcerated prisoners.
c
Plaintiff further submits that the foia prisoner exclusions violate constitutional equal protection guarantees by authorizing differential treatment of incarcerated prisoners and convicted criminals who are not incarcerated. The federal and Michigan constitutional Equal Protection Clauses both require that persons under similar circumstances be treated alike, but do not demand consistent treatment of persons under different circumstances. In re Hawley, 238 Mich App 509, 511; 606 NW2d 50 (1999).
Courts apply one of three tests when reviewing a party’s challenge of a legislative classification as violative of equal protection. Which test applies depends on the type of classification made by the statute and the nature of the interest affected. Legislation creating inherently suspect classifications on the basis of race, alienage, ethnicity, and national origin, or affecting a fundamental interest, undergoes the strict scrutiny test. Merely suspect classifications, including distinctions involving gender and mental capacity, invoke an intermediate level substantial relationship test. Social or economic classifications must pass the least rigorous rational basis test. Under the rational basis test, a statute qualifies as constitutional if its classification scheme rationally relates to a legitimate governmental purpose. People v Pitts, 222 Mich App 260, 272-273; 564 NW2d 93 (1997).
We employ the rational basis test in this case because the FOIA prisoner exclusions, which were intended to halt incarcerated prisoners’ abuse of public resources, constitute a social or economic measure. Seaton, supra at 322. Furthermore, the exclusions’ focus on one’s status as an incarcerated prisoner does not involve a suspect classification. People v Krajenka, 188 Mich App 661, 663; 470 NW2d 403 (1990). We find that the Legislature’s foia exclusions singling out incarcerated prisoners rationally relate to the Legislature’s legitimate interest in conserving the scarce governmental resources squandered responding to frivolous FOIA requests by incarcerated prisoners. Pitts, supra at 273 (explaining that a rational basis exists when any state of facts, either known or which could reasonably be assumed, supports a classification scheme).
Moreover, the foia prisoner exclusions do not treat similarly situated prisoners differently. Incarcerated prisoners are differently situated than convicted criminals who are not incarcerated. The available legislative history behind the prisoner exclusions notes that most foia requests by criminals “are made by prisoners under the DOC’s jurisdiction.” Senate Fiscal Analysis, SB 639, December 15, 1993, p 1. Even assuming that the FOIA prisoner exclusions result in some unfairness to the extent that they permit some convicted felons to invoke the FOIA while others like plaintiff cannot, “[a] classification that has a rational basis is not invalid because it results in some inequity.” Pitts, supra at 273.
We therefore conclude that the FOIA prisoner exclusions plainly and unambiguously exclude all incarcerated prisoner requests for information under the act and that plaintiff has presented no cognizable claim of a constitutional deprivation. Plaintiff failed to overcome the presumption that the FOIA prisoner exclusions qualified as constitutional. In re AH, supra.
m
Plaintiff lastly contends that Lieutenant Harris, who denied plaintiffs foia requests, was not a fair and impartial decisionmaker because he led the criminal investigation of plaintiff and because plaintiff requested documents that he believed would have substantiated Harris’ improper conduct dining the investigation. We review de novo this constitutional issue. People v Slocum (On Remand), 219 Mich App 695, 697; 558 NW2d 4 (1996).
The Due Process Clause demands a fair and impartial decisionmaker. Cain v Dep’t of Corrections, 451 Mich 470, 497; 548 NW2d 210 (1996). Even absent a showing of a decisionmaker’s actual bias, a decisionmaker must be disqualified when, for example, he might have prejudged the case because of his prior participation as an accuser, investigator, factfinder, or initial decisionmaker. Id. at 498. We agree that because Lieutenant Harris previously participated in the investigation of plaintiff’s criminal case and appears to be the subject of allegedly improper conduct within plaintiff’s requests for information, some potential risk of bias by Lieutenant Harris existed. Nonetheless, we conclude that no due process violation occurred because the foia prisoner exclusions vested Lieutenant Harris with absolutely no discretion to exercise in responding to plaintiff’s request, instead plainly forbidding plaintiff’s right of access to the information he sought.
Affirmed.
Plaintiffs letter requested the following information:
1. Names of all White Lake Township Police officers involved in the investigation ....
2. Copies of all investigators [sic] personal notes, personal interview notes with witnesses, co-defendant, defendant, ect [sic], including any and all, of Lt. Edward Harris’[,] Sgt. Randy Lingenfelter’s and Officer Steven Ross’ personal investigation notes and personal witness’ [sic] interview notes.
3. Names of all officer [sic] at Mr. Proctors [sic] home on Davista Dr. prior to and during the execution of the search warrant on the home.
4. Copy the impoundment receipt of the U-Haul truck removed from Mr. Proctor’s home, name of towing company, tow truck driver, any and all records of towing company involving [sic] this impoundment, any and all records of this impoundment in the possession of the White Lake Police Department including, log book entries, or record [sic] or notes in the possession of any agent of the White Lake Police Department.
5. Copy [sic] of any and all policy directive [sic], operating procedure [sic] and/or ordinance [sic] concerning the impound of vehicles, including any other documents that explain the White Lake Township Police Departments [sic], procedure and policies in impounding vehicles, including those in use in January 1995.
6. Copies of any and all photographs taken of the crime scenes, Mr. Proctors [sic] home ect. [sic].
7. Copies of any and all witness statements made on audio tape, including those of Mr. Proctor and [codefendant] Harry Camp.
8. Copies of all photographs used in photo show up, presented to Mrs. Diane Burby, and any other witnesses.
9. Copies of any and all, log entries of any witnesses indicating time arrived and left police station.
MCL 15.233(1) authorizes “a person ... to inspect, copy, or receive copies of [a] requested public record of [a] public body.”
Because the legislative intent appears clearly from the unambiguous statutory language, we decline plaintiffs invitation to attempt interpretation of the statute according to select portions of the legislative history. Sun Valley Foods Co v Ward, 460 Mich 230, 236; 596 NW2d 119 (1999).
Consequently, the circuit court properly granted defendant summary disposition regarding plaintiffs FOIA claim pursuant to MCR 2.116(C)(8). Spiek, supra at 337 (noting that a C[8] motion must be granted if no factual development could justify the plaintiffs claim for relief).
Plaintiffs citations include Bounds, supra at 827, 828 (In cases involving “original actions seeking new trials, release from confinement, or vindication of fundamental civil rights,” “the fundamental constitutional right of access to the courts requires prison authorities to assist inmates in the preparation and filing of meaningful legal papers by providing prisoners with adequate law libraries or adequate assistance from persons trained in the law.”); Wolff v McDonnell, 418 US 539, 579; 94 S Ct 2963; 41 L Ed 2d 935 (1974) (stating that prisoners have a due process right of access to the courts that guarantees them legal assistance in preparing habeas corpus petitions and civil rights actions); Johnson v Avery, 393 US 483, 490; 89 S Ct 747; 21 L Ed 2d 718 (1969) (holding that “until the State provides some reasonable alternative to assist inmates in the preparation of petitions for post-conviction relief, it may not validly enforce a regulation . . . barring inmates from furnishing such assistance to other prisoners”); Abdul-Akbar v Watson, 4 F3d 195, 203 (CA 3, 1993) (describing the right of access standard as “whether the legal resources available to a prisoner will enable him to identify the legal issues he desires to present to the relevant authorities . . . and to make his communications with and presentations to those authorities understood”); Peterkin v Jeffes, 855 F2d 1021, 1037 (CA 3, 1988) (citing Bounds, supra, in addressing death row inmates’ claim that prisons provided them access to legal materials and legal assistance insufficient to satisfy the constitutional requirement of access to the courts); Jackson v Procunier, 789 F2d 307, 311 (CA 5, 1986) (finding that a prisoner’s constitutional right of access to the courts was violated when prison mailroom workers intentionally delayed mailing the prisoner’s appeal of an adverse civil judgment against him); Ward v Kort, 762 F2d 856, 858 (CA 10, 1985) (finding that the right of access to the courts also applies to “personfs] under a mental commitment”). None of these cases supports plaintiffs suggestion that application of the foia prisoner exclusions in this case somehow deprived plaintiff of his fundamental right of access to the courts.
We also reject plaintiffs suggestion that the foia prisoner exclusions infringe his First Amendment rights. We find instructive Fisher v King, 232 F3d 391, 398 (CA 4, 2000), a recent case addressing the plaintiff prisoner’s claim that Virginia’s foia prisoner exclusion unconstitutionally restricted “prisoner access to information to which the general public is guaranteed access under the First Amendment.” After examining Los Angeles Police Dep’t v United Reporting Publishing Corp, 528 US 32; 120 S Ct 483; 145 L Ed 2d 451 (1999), the Fourth Circuit Court of Appeals concluded in Fisher that “the vfoia’s Prisoner Exclusion Provision is . . . not subject to a facial overbreadth challenge because it does not carry the threat of prosecution for violating the statute and it does not restrict expressive speech, but simply regulates access to information in the possession of Virginia state agencies.” Fisher, supra at 398-399.
In addressing the retroactivity of the foia’s prisoner exclusions, this Court in Seaton, supra at 323, explained that a prisoner’s foia request for the records of his own criminal trial “is procedural in nature for the reason that irrespective of the K, the prisoner has a substantive constitutional right to obtain such records.” This Court quoted Jones v Wayne Co Prosecutor’s Office, 165 Mich App 62, 65; 418 NW2d 667 (1987), as follows:
While the mfoia would also appear to be applicable to the present case, we conclude that MCR 6.101(L) [now MCR 6.433] governs exclusively when, as in the present case, a person seeks records related to his or her criminal conviction.
The method of obtaining documents related to a person’s criminal conviction is a matter of procedure rather than substantive law. After all, the issue is not plaintiff’s substantive right to the documents, but rather merely from whom he must request the documents. Procedural issues in the state courts are governed by court rule, not by statute. [Seaton, supra at 323.]
This Court concluded that the prisoner’s “rights and remedies are governed by the Michigan and federal constitutions and MCR 6.433.” Seaton, supra at 324.
Because plaintiff failed to establish any genuine issues of material fact regarding his various constitutional claims, summary disposition of these arguments was warranted pursuant to MCR 2.116(C)(10). Spiek, supra. | [
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Bandstra, C.J.
The prosecution appeals as of right from the trial court’s order denying its motion to reconvene the jury. We dismiss the appeal for lack of jurisdiction.
I. BASIC FACTS AND PROCEDURAL HISTORY
Defendant was tried before a jury on one count each of assault with intent to commit murder and leaving the scene of a serious personal injury motor vehicle accident. At the close of trial, the jury was instructed concerning the elements of both charged offenses, as well as the lesser included offense of assault with intent to commit great bodily harm less than murder. After deliberating for little more than a day, the jury indicated that it had reached a verdict with respect to count n — leaving the scene of an accident — but it was unable to reach a unanimous decision on the assault charge. Noting that the jurors had not yet spent a great deal of time deciding the case, the trial court accepted the jury’s verdict of guilty on count n of the information but sent the panel back to continue its deliberations with respect to count i. A short while later, the following transpired:
The Court: I’ve received a note indicating that you have reached a verdict regarding the first count of the information. Is that correct?
[Jury Foreperson]: Yes.
The Court: [The court clerk] will receive the verdict.
The Court Clerk: Mr. Foreperson, how do you find the defendant, Rahiem L. Henry as to the charge of assault with intent to murder?
[Jury Foreperson]: Find him not guilty.
The Court Clerk: Jurors, would you please stand and raise your right hand. Mr. Foreperson and members of the jury, you do say upon your oath that you find the defendant, Rahiem L. Henry, not guilty of the charge of assault with intent to murder. So say you Mr. Foreperson, so say you all members of the jury? Is that your verdict?
The jurors responded affirmatively, after which they were thanked and discharged by the court following the prosecutor’s decline of an offer to poll. Immediately thereafter, the court was presented with a verdict form, signed by the jury foreperson, indicating that although the jury had acquitted defendant of the primary charge of assault with intent to murder, it had nonetheless convicted him of the lesser included offense of assault with intent to do great bodily harm less than murder. Although finding that there had been an apparent “breakdown in communication” between itself and the jury foreperson when receiving the verdict on count I, the court nonetheless determined that, because it had accepted a verdict and discharged the jury, it had no choice but to dismiss the assault charge. Relying on the written verdict form, the prosecutor moved to reconvene the jury at a later date so that it might “complete” its verdict on count I. The trial court denied the motion, finding that to do so would be a violation of defendant’s right to be free from twice being placed in jeopardy. We find no error in this decision.
n. JURISDICTION
A. THE PROSECUTOR’S RIGHT TO APPEAL
In criminal cases, the state is authorized to take an appeal from a final judgment or order of a court or tribunal only where “the protection against double jeopardy [under the state and federal constitutions] would not bar further proceedings against the defendant ... .” On a number of occasions, we have held that this statutory limitation does not prevent the government from seeking an appeal where reinstatement of a verdict of conviction, rather than a retrial, is sought. Here, however, the prosecutor does not seek merely to reinstate a verdict clearly expressed by the existing record, but, rather, to continue proceedings against defendant so that such a record may be developed. As hereafter explained, we find the trial court to have correctly determined such proceedings to be barred by the double jeopardy protections and there fore dismiss this matter for want of appellate jurisdiction.
B. JURY RECALL AND DOUBLE JEOPARDY PROTECTIONS
A double jeopardy challenge involves a question of law that this Court reviews de novo. Both the United States and Michigan Constitutions prohibit placing a defendant twice in jeopardy for a single offense. “When a defendant exercises the right to trial by jury, jeopardy generally attaches at the time the jury is selected and sworn.” Once jeopardy attaches, the defendant has “a constitutional right to have his case completed and decided by that tribunal.” The underlying principle of such protection is to prevent the state from making “repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty.”
This Court in People v Rushin applied double jeopardy protections in a situation similar to that presented here. There, after returning verdicts of not
guilty, the jury was dismissed by the trial court and left the courtroom. Moments later, however, the panel was reassembled and ordered to continue its deliberations after the trial court learned that a member of the panel had, dining assent, expressed dissatisfaction with the reported verdict. When these additional deliberations failed to produce a unanimous decision, a mistrial was declared after which the defendants were subsequently retried and convicted. In reversing those convictions on appeal, we held that “the jury’s verdict of acquittal at the first trial was final.”
Once the jury has been officially discharged and left the courtroom, ... it is error to recall it in order to alter, amend or impeach a verdict in a criminal case. As soon as it departs from the courtroom, the jury’s legal duties cease to exist; it no longer functions as a unit charged to perform a solemn task but rather as 12 unsworn members of the community; its relationship to the case has terminated. . . .
To rule that a jury could be recalled after being discharged and leaving the courtroom would not only offend the policies underlying the double jeopardy clause, but would also serve as an invitation to tamper with the jury after it had completed its deliberations. [Id. at 398-399 (emphasis added).]
Here, like the jury’s verdict at the first trial in Rushin, the jury’s verdict in the instant matter was final. Although a jury is free to change the form and substance of a verdict to coincide with its intentions at any point before its discharge, once discharged the panel is defunct as a legal body and is therefore without power to alter or amend the verdict. We find that, in light of the verdict assented to by the jury and accepted by the trial court, the jeopardy that had attached at the selection and swearing of the jury terminated with that panel’s discharge, thereby precluding any further proceedings relating to the assault with which defendant was charged.
In reaching this conclusion, we reject the prosecution’s claim that, because it does not seek to permit the jury to further deliberate in this matter but, rather, merely to “complete” a verdict previously reached yet delayed in its pronouncement, the finality interests of the Double Jeopardy Clause have no relevance here. Unlike the circumstances presented in People v Kinard, where the defendant was tried for murder before the bench, the defendant in the instant matter elected to invoke his constitutional right to a trial by jury. gic or required to explain their decisions, and therefore may act solely out of a desire for lenience, a judge sitting without a jury is not afforded the same latitude. Indeed, when sitting as the trier of fact, the trial court is required to place its findings of fact and conclusions of law on the record or in a written opinion. Thus it was held in Kinard that the trial court’s failure, until sentencing, to expressly render a decision on the additional charge of possession of a firearm during the commission of a felony did not require that the defendant’s conviction on that charge be reversed:
Because the findings of fact stated at the close of trial supported the decision eventually announced, no danger of abuse is presented. Moreover, while finality of verdicts may be required by the Double Jeopardy Clause and desirable as a matter of policy, see [Rushin, supra], these interests have no relevance here because the trial court did not change its finding but merely delayed in announcing it.[ ]
In contrast to the clear and irrefutable findings of record that supported the delayed verdict of the sole trier of fact in Kinard, we are left here with only the written verdict form. Because the verdict indicated by that form was never assented to by the jury, either as a whole or individually, it cannot be said with any certainty that this form, signed by only one member of the panel, represents the unanimous decision of the jury, so as to permit a conclusion that the relief sought by the prosecutor would amount to no more than the delayed announcement of a verdict already validly established.
For similar reasons, we find the prosecution’s reliance on People v Gabor to also be misplaced. In Gabor, the defendant was tried by a jury on two counts of fourth-degree criminal sexual conduct. Following deliberations, the jury foreperson stated on the record the jury’s verdict of “ ‘guilty for the act of criminal sexual conduct in the first degree for the first offense and guilty for the act of criminal sexual conduct in the second degree second offense.’ ” Upon being polled, each juror affirmed the reported verdict, after which the jury was dismissed by the trial court. Immediately thereafter, counsel for the defendant moved to set aside the verdict on the ground that the jury had convicted the defendant of first- and second-degree criminal sexual conduct, rather than the fourth-degree offenses with which he had been charged. In response, the trial court recalled the jury and requested that the foreperson read the verdict again. The verdict, as read by the foreperson upon recall, was “ ‘guilty first offense criminal sexual conduct in the fourth degree, guilty of the second offense criminal sexual conduct in the fourth degree.’ ” In reversing the trial court’s dismissal of both counts, we stated:
As the trial court correctly recognized, the jury’s function ceased after it had been discharged. [Rushin, supra.] The trial court wrongly concluded, however, that dismissal of the charges against defendant was required in this case. On the whole record, in keeping with “a rule of reasonableness” in construing the jury verdict, we can easily deduce that the jury intended to convict defendant of both counts of the charged offense. The two counts of fourth-degree CSC were the only charges on which defendant was tried and the only counts on which the jury was instructed. There were no lesser offense instructions. The written verdict form clearly and unambiguously reflects the jury’s verdict of guilty of both counts of fourth-degree esc.[ ]
Here, however, the verdict form does not so “clearly and unambiguously reflect[] the jury’s verdict . . . .” In Gabor, the jury’s intent to convict the defendant as charged was apparent from the foreperson’s statement of the verdict in open court, even apart from the written verdict form. As noted by the panel in Gabor, this was due in large part to the absence of any option to convict of a lesser offense. In contrast, however, while the jury’s intent to acquit the instant defendant of the principal offense of assault with intent to murder can be clearly gleaned from the foreperson’s statement of the verdict, the same cannot be said for its decision regarding the lesser offense of assault with intent to do great bodily harm. Accordingly, we do not believe that under the facts of this case, the written verdict form presents the “contemporaneous [and] objective indication” of juror intent argued by the prosecutor.
IE. RETRIAL ON THE LESSER INCLUDED OFFENSE
As a final consideration, we note that because a final verdict of acquittal was rendered by the jury with respect to the charged offense of assault with intent to murder, a retrial regarding the lesser included offense of assault with intent to do great bodily harm is precluded.
We dismiss.
MCL 750.83.
MCL 257.617.
MCL 750.84.
The court explained this breakdown as follows:
I thought that the question put to [the foreperson] was, how do you find the defendant as to Count i. And I believe the response that he gave was not guilty. And I interpreted that to mean that, exactly what it said, that he is not guilty of Count I, so that we needed not, did not need to make inquiry regarding the lesser charges.
We note that the record further indicates that, upon rendering their verdict as inquired into by the court clerk, there was apparently some “hesitation” by the jurors as if “they wanted to add more.”
The court, however, retained the jury’s verdict with respect to count n of the information, for which defendant was subsequently sentenced to a term of two years’ probation.
MCL 770.12(1).
See, e.g., People v Hutchinson, 224 Mich App 603, 606-607; 569 NW2d 858 (1997), quoting People v Jones, 203 Mich App 74, 78-79; 512 NW2d 26 (1993); People v McEwan, 214 Mich App 690; 543 NW2d 367 (1995). See also People v Reynolds, 181 Mich App 185, 188; 448 NW2d 774 (1989) (“[a] prosecutor’s appeal of a sentence does not subject the defendant to a second trial, but only a correction of the judgment, and thus does not present double jeopardy implications”).
MCR 7.203(E). See also People v Hinerman, 420 Mich 851, 851; 358 NW2d 894 (1984) (“[t]he Court of Appeals had no authority to entertain the prosecution’s appeal of the trial court’s decision . . . since MCL 770.12; MSA 28.1109 does not permit such an appeal under the circumstances . . .”).
People v Kulpinski, 243 Mich App 8, 12; 620 NW2d 537 (2000).
US Const, Am V; Const 1963, art 1, § 15.
People v Mehall, 454 Mich 1, 4; 557 NW2d 110 (1997).
People v Dry Land Marina, Inc, 175 Mich App 322, 325; 437 NW2d 391 (1989).
Green v United States, 355 US 184, 187-188; 78 S Ct 221; 2 L Ed 2d 199 (1957).
People v Rushin, 37 Mich App 391; 194 NW2d 718 (1971).
Id. at 393-394.
Id. at 394.
Id.
Id. at 399.
See People v McGee, 247 Mich App 325, 339; 636 NW2d 531 (2001) (a verdict in a criminal case becomes final when “it is announced in open court, assented to by the jury, and accepted by the trial court”); see also MCR 6.420, which establishes the procedure for acceptance of verdicts in criminal cases. Here, following the jury’s assent, the trial court determined the oral reading of the verdict to be the verdict of record and discharged the jury. The verdict regarding the sole remaining count was thus final, rendering any attempt to amend or otherwise alter the verdict a violation of the principles of double jeopardy and this Court’s decision in Rushin.
See People v McNary, 43 Mich App 134, 142-143; 203 NW2d 919 (1972), rev’d in part on other grounds 388 Mich 799 (1972), wherein we stated:
A jury verdict is not merely the first sentence uttered by the foreman when asked for the verdict. Often the verdict will have to be clarified and interpreted by either the judge or the jury until it specifically identifies a known crime. The judge has a right to clarify the form of the verdict if the jury has not been discharged; and the jury can always change the form and the substance of the verdict to coincide with its intention, before it is discharged.
See Rushin, supra at 395 (“The double jeopardy clause clearly enunciates a policy of finality in criminal proceedings in favor of the defendant.”), citing United States v Jorn, 400 US 470, 479; 91 S Ct 547; 27 L Ed 2d 543 (1971).
People v Kinard, 129 Mich App 94, 98; 341 NW2d 820 (1983).
US Const, Am VI; Const 1963, art 1, § 20.
People v Vaughn, 409 Mich 463, 466; 295 NW2d 354 (1980).
See MCR 2.517(A).
Kinard, supra at 98.
In any event, as a result of one juror’s death in the time since the trial, any attempt to definitively ascertain the intentions of the individual jurors with respect to the verdict form is impossible.
People v Gabor, 237 Mich App 501; 603 NW2d 840 (1999).
Id. at 502.
Id.
Id. at 502-503.
Id. at 503.
Id.
Id.
Id. at 503-504.
Id. at 504.
See n 19, supra.
See Brown v Ohio, 432 US 161, 168-169; 97 S Ct 2221; 53 L Ed 2d 187 (1977), in which the Court held that greater and lesser included offenses must be considered the “ ‘same’ ” for constitutional double jeopardy analysis, and that “[w]hatever the sequence may be, the Fifth Amendment forbids successive prosecution and cumulative punishment for a greater and lesser included offense.” | [
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Smolensk, J.
Plaintiff Joseph F. Lavey, II, conservator for KB, a minor, appeals as of right from the trial court’s order granting defendants summary disposition under MCR 2.116(C)(7). Plaintiff brought an action for false imprisonment, battery, and violation of constitutional rights. The trial court concluded that defendants were immune from tort liability because they were engaged in a good-faith investigation of alleged child abuse. We affirm in part, reverse in part, and remand for further proceedings consistent with this opinion.
I. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff is the conservator for KB, a severely disabled child who cannot speak, has limited ability to walk, and requires diapering. When the relevant events occurred, she was nine years old. The instant case arises from defendants’ attempts to investigate the possibility that KB was the victim of sexual abuse. Defendant Diane Mills is a teacher’s aide in the special-education program for the public school district that KB attends. Defendant Ann Picotte is the school principal. Defendant Donna Beauchaine is a Michigan State Police trooper assigned to investigate criminal sexual abuse cases. Defendant Larry Pittman is a child protective services worker with the Family Independence Agency (fia).
On February 5, 1996, while changing KB’s diaper, Mills noticed abnormal conditions in KB’s genital area. Mills alerted the classroom teacher, Sandy Khoebel, who agreed that the conditions appeared abnormal. Mills and Knoebel then alerted Picotte about the problem. After observing the conditions, Picotte contacted the prosecutor’s office to report her suspicion that KB was being sexually abused. The prosecutor instructed Picotte to contact Trooper Beauchaine, and Picotte followed those instructions. Trooper Beauchaine visited the school on February 9, 1996, and observed KB, as well. Beauchaine suspected that KB was being sexually abused. However, because KB was unable to conununicate verbally, Beauchaine was unable to verify her suspicions without physical evidence. Beauchaine therefore asked the school to inform her immediately upon the discovery of further symptoms.
On April 23, 1996, Picotte contacted Beauchaine and reported that she and Mills had observed additional symptoms in KB’s genital area, which suggested potential sexual abuse. Beauchaine directed Picotte to immediately transport KB to a doctor’s office, assuring Picotte that the school had legal authority to do so. Beauchaine did not obtain a search warrant or a court order for the gynecological examination. Nor did Beauchaine investigate or determine what legal procedures she should have followed. Rather, Beauchaine contacted defendant Pittman at the FIA and asked him to meet her at the doctor’s office. Rttman signed a consent form, purporting to be KB’s legal guardian, authorizing the gynecological examination. Rttman later admitted that he signed the consent form despite the knowledge that he lacked authority to have KB examined by a doctor, absent parental consent or a court order.
Picotte and Mills transported KB to the doctor’s office. When they arrived, Beauchaine and Rttman were already present. Mills and Beauchaine accompanied KB into an examining room, where a doctor performed a gynecological examination. That examination included oral, vaginal, and rectal swabs. After the examination, Mills and Picotte transported KB back to school, while Beauchaine awaited the laboratory results. Later that day, Beauchaine obtained the laboratory results, which were negative for any evidence of sexual abuse. Beauchaine did not inform Mills, Picotte, or Pittman that the results were negative. Further, no one attempted to contact KB’s parents, either before or immediately after the examination. However, Beauchaine met with KB’s parents the following day, accusing KB’s father of sexually molesting the child. No evidence of sexual abuse was ever discovered, and no criminal charges alleging sexual abuse were ever brought against KB’s parents.
KB’s conservator brought the instant action against Mills, Picotte, Beauchaine, and Pittman, alleging that (1) they falsely imprisoned KB by taking her to the doctor’s office without parental consent or a court order, (2) they battered KB by subjecting her to a gynecological examination, and (3) they violated KB’s constitutional right to remain free from unreasonable searches and seizures. Defendants Picotte, Beauchaine, and Pittman moved for summary disposition, arguing that they were immune from tort liability under the governmental immunity statute, MCL 691.1407(2), and § 5 of the Child Protection Law, MCL 722.625, and arguing that the alleged constitutional violation failed to state a claim on which relief can be granted. Although Mills did not move for summary disposition, the parties agreed that the trial court should dismiss plaintiff’s claims against Mills if it dismissed plaintiff’s claims against the other defendants.
The trial court granted summary disposition in favor of all defendants, pursuant to MCR 2.116(C)(7). The trial court assumed, for purposes of deciding the motion, that defendants should have obtained a court order before subjecting KB to the gynecological examination. Nonetheless, the trial court held that defendants were immune from tort liability because they were engaged in a good-faith investigation of possible child abuse. Plaintiff appeals as of right.
We affirm the trial court’s grant of summary disposition to all defendants on plaintiff’s constitutional claim. We also affirm the trial court’s grant of summary disposition to defendants Mills and Picotte on all remaining claims. We reverse the trial court’s grant of summary disposition to defendants Pittman and Beauchaine on plaintiff’s battery and false imprisonment claims. We remand to the trial court for further proceedings regarding those claims.
H. STANDARD OF REVIEW
We review de novo a trial court’s decision granting or denying a motion for summary disposition under MCR 2.116(C)(7) to determine whether the moving party was entitled to judgment as a matter of law. DeCaminada v Coopers & Lybrand, LLP, 232 Mich App 492, 496; 591 NW2d 364 (1998), citing Limbach v Oakland Co Bd of Co Rd Comm’rs, 226 Mich App 389, 395; 573 NW2d 336 (1997). In making this determination, this Court must consider all the documentary evidence in the light most favorable to the nonmoving party. Barrow v Pritchard, 235 Mich App 478, 480; 597 NW2d 853 (1999). Further, this Court must accept the contents of the complaint as true unless specifically contradicted by the documentary evidence. Sewell v Southfield Public Schools, 456 Mich 670, 674; 576 NW2d 153 (1998).
m. CONSTITUTIONAL CLAIM
Plaintiff argues that the gynecological examination constituted an unreasonable search and seizure of KB’s person and that defendants were liable for damages resulting from this alleged constitutional violation. However, our Supreme Court has clearly held that no inferred damages remedy for a violation of a state constitutional right exists against individual government employees. Jones v Powell, 462 Mich 329, 335; 612 NW2d 423 (2000). Therefore, with regard to the alleged constitutional violation, plaintiff has failed to state a claim on which relief can be granted. MCR 2.116(C)(8). The trial court did not dismiss plaintiff’s claim on this ground. Nevertheless, “[w]hen this Court concludes that a trial court has reached the correct result, this Court will affirm even if it does so under alternative reasoning.” Messenger v Ingham Co Prosecutor, 232 Mich App 633, 643; 591 NW2d 393 (1998). We therefore hold that the trial court properly granted summary disposition to all defendants on plaintiff’s constitutional claim.
IV. THE CHILD PROTECTION LAW
The Child Protection Law, MCL 722.621 et seq., outlines various requirements regarding the reporting and investigation of suspected child abuse. One section of the statute grants immunity from tort liability in relation to such reporting and investigation. Section 5 of the act, MCL 722.625, provides, in pertinent part:
A person acting in good faith who makes a report, cooperates in an investigation, or assists in any other requirement of this act is immune from civil or criminal liability that might otherwise be incurred by that action. A person making a report or assisting in any other requirement of this act is presumed to have acted in good faith. This immunity from civil or criminal liability extends only to acts done pursuant to this act and does not extend to a negligent act that causes personal injury or death or to the malpractice of a physician that results in personal injury or death.
The trial court relied on this statutory language when it granted summary disposition to defendants. Concluding that each of the defendants had acted in good faith, the trial court held that defendants were entitled to the statutory immunity. Plaintiff challenges that holding, arguing that defendants are not entitled to the statutory immunity because they were not acting in good faith and because their actions were neither required nor authorized by the provisions of the Child Protection Law.
Very few published opinions have examined the immunity granted by MCL 722.625 and that case law explains that good-faith reporting of suspected child abuse and good-faith cooperation with an investigation into suspected child abuse are activities that render a person immune from tort liability. However, in the present case, we must examine the statutory language to determine whether the immunity extends to good-faith acts that violate other requirements set forth in the Child Protection Law. We conclude that it does not.
A. DEPENDANT PICOTTE
. Defendant Picotte argues that she simply reported suspected child abuse to the police and cooperated, in good faith, with the ensuing investigation. Thus, she argues that she is entitled to immunity under the Child Protection Law. We agree.
In Awkerman v Tri-County Orthopedic Group, PC, 143 Mich App 722, 724; 373 NW2d 204 (1985), a five-year-old boy suffered several bone fractures over a short period and his treating physicians reported suspected child abuse. The child was removed from his mother’s custody, but was later returned when he was diagnosed with brittle-bone disease. Id. The child and his mother brought an action against the physicians for the wrongful reporting of suspected child abuse and resultant removal of the child from his mother’s custody. Id. at 724-725. This Court applied MCL 722.625 and concluded that the physicians were immune from liability, having acted in good faith. Awkerman, supra at 726-727. In resolving the case, this Court noted that the public policy behind the statute was “to encourage reporting of suspected child abuse . . . Id. at 728. To further that policy, “[t]he act clearly and unambiguously provides immunity to persons who file a child abuse report in good faith.” Id. at 726.
In Warner v Mitts, 211 Mich App 557, 560; 536 NW2d 564 (1995), this Court held that the statutoiy immunity “extends not only to the making of the report but also to a party’s cooperation in an investigation.” In that case, the plaintiffs brought a slander suit against the defendant, alleging that he falsely reported to the Department of Social Services (dss) that one of the plaintiffs had sexually abused the plaintiffs’ minor daughter. Id. at 558. During the dss investigation, the defendant also accused the other plaintiff of being mentally ill and alleged that both plaintiffs had solicited the defendant to participate in certain sexual acts. Id. This Court affirmed the trial court’s grant of summary disposition to the defendant, holding that the plaintiffs had failed to overcome the statutoiy presumption that the defendant was acting in good faith. Id. at 559-560. This Court concluded that the statutory grant of immunity was not limited to the defendant’s initial report of suspected abuse, but extended to additional reports rendered in cooperation with an abuse investigation. Id.
In the present case, KB’s teacher informed Picotte that KB was exhibiting unusual conditions in her genital area. This constituted reasonable cause to suspect that KB might be the victim of sexual abuse. In Warner, supra at 559, this Court held:
[A] person who has “reasonable cause to suspect child abuse” is by definition “acting in good faith” when reporting the suspicions. Thus, immunity extends to reports of “sus pected” child abuse regardless of the outcome of a subsequent investigation.
Despite the fact that no charges were ever filed against KB’s parents regarding the alleged child abuse, we conclude that Picotte was acting in good faith when she reported the situation to the county prosecutor and the police.
After reporting the matter, Picotte simply cooperated with the investigation. She reported later incidents of suspected abuse, as directed by Beauchaine. She transported KB to the doctor’s office at Beauchaine’s direction, and only after Beauchaine assured her that she had the legal authority to do so. Under the Child Protection Law, schools are required to cooperate with investigations of suspected child abuse. MCL 722.628(8). That cooperation “includes allowing access to the child without parental consent if access is determined by the department to be necessary to complete the investigation or to prevent abuse or neglect of the child.” Id. We conclude that Picotte acted in good faith when she transported KB to the doctor’s office, at Beauchaine’s direction, without first obtaining the consent of KB’s parents.
Summary disposition is appropriate when reasonable minds could not differ. Vermilya v Dunham, 195 Mich App 79, 83; 489 NW2d 496 (1992). Under these circumstances, reasonable minds could not differ in concluding that Picotte acted in good faith and in compliance with the Child Protection Law when reporting the suspected abuse and cooperating with the investigation. Awkerman, supra; Warner, supra. Accordingly, we conclude that the trial court properly granted summary disposition in favor of defendant Picotte.
B. DEFENDANTS BEAUCHAINE AND PITTMAN
Like defendant Picotte, defendants Beauchaine and Pittman argue that they are entitled to immunity from tort liability under MCL 722.625. They argue that they were either investigating a report of suspected child abuse or cooperating with such an investigation, and that they were acting in good faith. The trial court agreed, holding that plaintiff had failed to overcome the statutory presumption that Beauchaine and Pittman had acted in good faith. We conclude that defendants Beauchaine and Pittman are not entitled to immunity under § 5.
First, defendants Beauchaine and Pittman argue that they are entitled to statutory immunity because they were acting pursuant to subsection 6(2) of the act, MCL 722.626(2), when they authorized KB’s gynecological examination. Section 6 provides, in pertinent part:
(2) When a child suspected of being an abused or neglected child is seen by a physician, the physician shall make the necessary examinations, which may include physical examinations, x-rays, photographs, laboratory studies, and other pertinent studies. The physician’s written report to the department shall contain summaries of the evaluation, including medical test results.
(3) If a report is made by a person other than a physician, or if the physician’s report is not complete, the department may request a court order for a medical evaluation of the child. The department shall have a medical evaluation made without a court order if the child’s health is seriously endangered and a court order cannot be obtained.
Defendants Beauchaine and Pittman argue that KB’s gynecological examination was authorized by subsection 6(2) because it was performed by a doc tor, after a report of suspected child abuse had been filed. However, defendants’ argument ignores subsection 6(3). That subsection of the statute applies when a report of suspected child abuse “is made by a person other than a physician . . . .” MCL 722.626(3). Because Mills and Picotte reported the suspected abuse, subsection 6(3) applies to the present case.
Subsection 6(3) provides that a medical evaluation of a child who is suspected of being abused may be performed without a court order only “if the child’s health is seriously endangered and a court order cannot be obtained.” MCL 722.626(3) (emphasis added). Defendants Beauchaine and Pittman did not comply with subsection 6(3). It is undisputed that they did not seek a court order authorizing the examination. They produced no evidence that KB’s health was seriously endangered. Finally, they produced no evidence that a court order could not have been obtained. Thus, it is clear that Beauchaine and Pittman violated § 6 when they arranged for KB’s gynecological examination without a court order.
The question then becomes whether the statutory immunity provided in § 5 applies to defendants who have violated other requirements of the Child Protection Law, such as subsection 6(3). We conclude that it does not. Section 5 clearly provides that “immunity from civil or criminal liability extends only to acts done pursuant to this act . . . .” We cannot conclude that defendants Beauchaine and Pittman acted “pursuant to” the Child Protection Law when they committed a clear violation of subsection 6(3). Because they were not acting “pursuant to” the Child Protection Law, they are not entitled to the immunity contained in § 5. Therefore, the trial court erroneously granted summary disposition to defendants Beauchaine and Pittman on the basis of statutory immunity.
Defendants Beauchaine and Pittman also argue that they are immune from tort liability under MCL 691.1407(2). However, that immunity does not apply to intentional torts of individual government employees. Sudul v Hamtramck, 221 Mich App 455, 458, 481; 562 NW2d 478 (1997). We therefore conclude that MCL 691.1407(2) does not bar plaintiff’s battery and false imprisonment claims.
Finally, defendants Beauchaine and Pittman argue that they were entitled to summary disposition on plaintiff’s battery and false imprisonment claims, even if they do not enjoy immunity under the Child Protection Law. However, because the trial court neither considered nor decided this issue, we decline to address it at the present time. Defendants Beauchaine and Pittman may raise these arguments before the trial court on remand.
We affirm the trial court’s grant of summary disposition to all defendants on plaintiff’s constitutional claim. We also affirm the trial court’s grant of summary disposition to defendants Mills and Picotte on all remaining claims. We reverse the trial court’s grant of summary disposition to defendants. Beauchaine and Pittman on plaintiff’s battery and false imprisonment claims. We remand to the trial court for further proceedings regarding those claims.
Affirmed in part, reversed in part, and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
The record reveals various spellings of this party’s name — Ann Picotte, Anne Picotte, and Anne Pecotte. For consistency purposes, we will employ the spelling utilized by plaintiffs.
Neither the prosecutor nor Beauchaine instructed Picotte to contact the fia. Apparently, Picotte refrained from contacting the fia out of concern that the ha would alert KB’s parents, whom she suspected as the perpetrators of the suspected sexual abuse.
Mills testified that, because KB rarely showed emotion, it was difficult to tell whether she was uncomfortable. However, the doctor subsequently wrote a letter to Pittman in which she stated that she could not perform a complete examination because of KB’s discomfort.
Plaintiff does not appeal the trial court’s grant of summary disposition to defendant Mills. In fact, plaintiff’s appeal brief states that Mills is “innocent” in this matter. Accordingly, we decline to review the trial court’s order dismissing plaintiffs claims against Mills.
We apply the statutory language in effect on April 23, 1996, because plaintiff’s complaint is based solely on the events that occurred that day. A subsequent amendment of the statutory language is not pertinent to the present case. See 1998 PA 428.
According to plaintiff’s brief, the gynecological examination occurred during regular business hours, on a week day, when the courts presumably would have been open for business. | [
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Hooker, C. J.
Plaintiff recovered a verdict and judgment in an action of assumpsit before a justice of the peace, which was reversed in the circuit court on appeal. The declaration was upon the common counts. The facts were undisputed, and in substance are as follows: In May, 1900, defendant’s intestate gave a written order to plaintiff’s agent for a monument to be erected upon her lot in the cemetery at the agreed price of $100, the same to be completed between that date and June 30, 1900, unless unforeseen causes should prevent, and in that event as soon thereafter as practicable. It was to be set upon a foundation to be erected by her. The contract was approved by the plaintiff on May 14th, of which Mrs. McClung was notified, and at the same time the monument was ordered to be made at the quarry. The latter part of June the plaintiff notified her to get the foundation ready, in response to which she wrote him that he need not bring that monument, as it did not come according to agreement. On July 5th plaintiff replied, stating that the monument was well under way, and he could not allow her to countermand her order; that it would be delivered as soon as completed, and would be strictly according to contract, and she was requested to have her foundation built as soon as possible. In response to this she wrote:
“You have not done according to agreement at all. You was to have it up by the 30th of June at the farthest. We are not obliged to wait your motion, so, if you bring it,-you may take it back.”
The plaintiff had the monument completed and set up upon a foundation erected by himself. This action was brought to recover the contract price and $1.50 for the foundation, with interest from August 23, 1900.
It was shown that the delay was caused by unforeseen circumstances. No complaint was made of the workmanship, which was such that the monument could not be used for any other purpose. The defendant claims that the plaintiff, upon receipt of Mrs. McClung’s letter, had no legal right to complete the contract and recover the price; that his only remedy was to recover in damages for a breach of the contract. Plaintiff, on the other hand, claims that it was competent to treat the contract as performed, and that he is entitled to recover the contract price upon the common counts.
It is undisputed that defendant unqualifiedly renounced this contract before the monument was completed, and forbade its completion and erection upon her premises. Many authorities hold that she had the right to do this, and thereafter plaintiff’s right of recovery would be limited to damages for the breach of the contract involved in the renunciation. In 2 Mechem, Sales, § 1091, the author says:
‘ ‘ The law is well settled that a party to an executory co'ntract may always stop performance on the other side by an explicit direction to that effect, though he thereby subjects himself to the payment of such damages as will compensate the other for the loss he has sustained by reason of having his performance checked at that stage in its progress.”
“The contract is not rescinded, but broken; and, while the other party has the fight to deem it in force for the purpose of the recovery of his damages, he is under no obligation, for that purpose, to tender complete performance, nor has he the right to unnecessarily enhance the damages by proceeding, after the countermand, to finish his undertaking.” Id. § 1092.
This subject is discussed in the case of Hosmer v. Wilson, 7 Mich., at page 305 (74 Am. Dec. 716), where Mr. Justice Christiancy says:
“And it is certainly very questionable whether the party thus notified has a right to go on after such notice to increase the amount of his own damages. In Clark v. Marsiglia, 1 Denio, 317 (43 Am. Dec. 670), it was held he had no such right, and that the employer has a right (in a contract for work and labor) to stop the work, if he choose, subjecting himself to the consequences of a breach of his contract; and that the workman, after notice to quit work, has no right to continue his labor, and recover pay for it. This doctrine is fully approved in Derby v. Johnson, 21 Vt. 21.”
Mr. Justice Christiancy adds that:
“This would seem to be good sense, and therefore sound law; and it would seem that any other rule must tend to the injury, and in many cases to the ruin, of all parties.”
In the case of Danforth v. Walker, 37 Vt. 244, the court said of a similar case:
“While a contract is executory, a party has the power to stop the performance on the other side by an explicit direction to that effect, by subjecting himself to such damages as will compensate the other party for being stopped in the performance on his part at that point or stage in the execution of the contract. The party thus forbidden cannot afterwards go on and thereby increase the damages, and then recover such increased damages of the other party.”
See, also, Butler v. Butler, 77 N. Y. 472 (33 Am. Rep. 648); Clause v. Printing-Press Co., 118 Ill. 612 (9 N. E. 201).
We are cited by plaintiff’s counsel to the case of Black v. Herbert, 111 Mich. 638 (70 N. W. 138), as a case on all fours with the present case; but we think it is readily distinguishable. In that case, after renunciation the parties met by appointment, and the plaintiffs were permitted to alter and set up the monument. It became, therefore, a question for the jury whether or not the contract had been performed. Renunciation must be more than mere idle talk of nonperformance; it must be a distinct, unequivocal, and absolute refusal to receive performance or to perform on his own part. 2 Mechem, Sales, § 1087. The party attempting to renounce may withdraw his renunciation and have the contract performed (Id. § 1090), and it would seem that the defendant in that case did so.
There are only two theories upon which the common counts could be relied upon in this case: First, upon the theory that the contract had been performed, and that the contract price was therefore recoverable; and, second, for the work and material used in the foundation built by the plaintiff. The undisputed facts show that the contract was not performed on receipt of the renunciation, and there could be no recovery for the erection of the foundation, because the plaintiff was never requested to build it, but,- on the contrary, was prohibited from doing anything further in performance of the contract. The only redress that the plaintiff would be entitled to recover would be damages for the breach of the contract if renunciation should be found to be unwarranted, which does not appear.
It follows that the judgment must be affirmed.
Moore, Grant, and Montgomery, JJ., concurred. Long, J., did not sit. | [
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] |
Moore, J.
The plaintiff is a Louisiana corporation engaged in the manufacture of Southern yellow pine lumber. The defendant is a Michigan corporation engaged in buying and selling lumber in the city of Detroit. In 1897 a firm known as T. R. Brent & Son turned over an order from Stilwell & Co. to plaintiff in this case. This order was expressed in the following correspondence:
“Shreveport, La., Oct. 12, 1897.
“To Stilwell & Co.,
“Detroit, Mich.
“ Gentlemen: T; R. Brent & Son, of Kansas City, have sent ns an order for 12 cars of rough clear stock. * * * I have concluded to take the order at the prices he quoted, provided you can take the cars as I can get them out during the next 60 or 90 days. I will try to get the cars off as you suggest, but we have to ship rough clear finishing lumber from small mills that have no planers, and cannot control the mills as to how they ship, as it is impossible for them to get out just a certain size, but they have to cut whatever their logs will run. * * * We have entered the order as shown on the inclosed tissue copy, and also with the understanding that you are to give us 60 days’ acceptance for the lumber as soon as the car is received and checked out, or discount the bill 2 per cent. If anything is wrong with the way we have agreed to enter these orders, please notify us immediately, as we do not want to ship it unless we have a satisfactory understanding in regard to it,” etc.
To this defendant replied as follows:
“Oct. 16, 1897.
“ To the W. K. Henderson Lumber Co.,
“Shreveport, La.
' ‘ Gentlemen: Your favor of the 12th inst. at hand and noted. We accept the conditions you name in regard to the shipments during the next 60 or 90 days, and also as to shipping mixed widths and thickness in the same car, with this condition, viz. -v * * * ”
Ten or eleven cars were shipped under this contract. The defendant received the lumber when it came, but made complaints about the lumber not answering the requirements of the contract. It is also claimed by plaintiff that defendant did not make the payments as it agreed. It is claimed by plaintiff that full settlements were made for all the lumber shipped, except the four car loads which are the subject of this controversy. In the court below the plaintiff recovered a judgment. The case is brought here by writ of error. There are upwards of 40 assignments of error, but not many of them call for discussion.
Certain depositions offered by plaintiff were received in evidence. It is claimed this was error because they did not sufficiently identify the lumber as being the lumber in controversy here. An inspection of the depositions shows they clearly identify the cars in which the lumber was shipped. We think their admission was not error.
It is the claim of defendant it is entitled to recoup for damages because the entire 12 cars were not shipped. The judge charged the jury as follows:
‘ ‘ There is no dispute, as I understand it, upon the part of the defendant, that this lumber was received, — these four car loads. There was a controversy concerning the lumber that had been shipped before, the testimony showing that there were 12 car loads ordered; and it is claimed upon the part of the defendant in this suit that they have a right to go into this whole contract; that it is what they term a ‘ continuing contract;’ and that they are entitled to show damages that they may have received on account of the first number of car loads not having come up to the requirements of the order. But as this suit is brought only to recover the value of these four cars, and it is claimed by the plaintiff that the pay for the other cars previously shipped had been settled, and that, in my opinion, not entering into the controversy here, I have ruled- — -and I think I am correct in that ruling — that nothing is to be considered by you in regard to the car loads that had been shipped previous to the four.
“ It is also claimed by defendant that he has a right to recoup damages on account of not having received the 12 car loads that he ordered; that previous to the shipment of the balance which would amount to the 12, whatever that number may have been, a controversy arose between these parties in regard to the payment of these four cars; and I charge you that it was not required of the plaintiff to have filled the balance of the order unless the matters concerning-the four cars had been adjusted between them. That is, the plaintiff had a right to receive his pay for the four cars, or have that matter in controversy settled, before he would be required to ship the balance of the order of 12 cars; so that, in my opinion, nothing is before you for consideration in this case except the question as to the four cars of lumber that have been testified to by witnesses in this controversy now before you for detérmination.”
As before stated, the record shows that settlements were made for the cars shipped prior to the four in controversy. It is apparent that, while 12 cars were ordered, it was expected by the parties they would be shipped in car lots, and at different times; settlement to be made for each car when received. The contract was severable. The case is within Williams v. Robb, 104 Mich. 242 (62 N. W. 352).
It is claimed the court erred in relation to the measure of damages. The defendant had an opportunity to inspect the lumber. According to its version, knowing it did not comply with the contract, it received it and kept it. It seeks not only to recover damages because the lumber did not meet the requirements of the contract, but also for the loss of profits. The charge of the court upon this branch of the case was more favorable to the defendant than it was entitled to have given. See Talbot Paving Co. v. Gorman, 103 Mich. 403 (61 N. W. 655, 27 L. R. A. 96); Williams v. Robb, supra.
Judgment is affirmed.
Hooker, C. J., Grant and Montgomery, JJ., concurred. Long, J., did not sit. | [
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] |
Hooker, C. J.
This is a bill filed by an administrator for the cancellation of a deed given by his intestate to his daughter and her husband, and for an accounting. The question is largely one of fact, and is not distinguishable from the ordinary case in its nature. Our examination of the record has been critical, and has satisfied us of the justice of the conclusion reached by the learned circuit judge who heard the cause. A long opinion would amount to no more than an unprofitable review and analysis of the testimony, which would be of no interest or value to the profession at large, and would be likely to add to the estrangement already existing between some members of the intestate’s family. In such cases there is usually an opportunity for differences of opinion upon the subject of mental competency, especially under the influence of self-interest. That seems to be so in this, instance.
It is urged that the decree must be modified, and that the relief granted should not extend to the interest of Mrs. Irrer, who is said to have contended for the validity of the deed to defendants. The bill was filed by the administrator on behalf of the estate. Mrs. Irrer is not a party. Even had she been made a party defendant, and had an opportunity, therefore, to appeal, there was no occasion for her to do so, if satisfied with the decree. The administrator must be considered as attacking the conveyance for the benefit of all persons interested in the estate, under the circumstances of this case.
The decree is affirmed, with costs.
Moore, Grant, and Montgomery, JJ., concurred. Long, J., did not sit. | [
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Montgomery, J.
The plaintiff, who, at the time of the injuries received, was between 14 and 15 years of age, was run into by one of defendant’s gravel trains, which consisted of three short cars filled with crushed stone, which were being pushed ahead of the motor. According to the plaintiff’s testimony, he passed out of his own yard about 6 o’clock in the evening, drawing his young brother in an improvised cart, by means of a rope which was thrown over plaintiff’s shoulders and brought under his arms. He testifies that he proceeded in the direction of Mt. Clemens, and when 195 feet, or thereabouts, east of the point at which he entered the highway, he saw the defendant’s regular train going towards Mt. Clemens; that he followed along a farther distance of about 190 feet, reaching a place where there was a plank walk extending across the track, and entered upon the space occupied by the track of defendant, and pursued his way to the east. He testifies that, after the car passed him, he did not again look in the direction of Detroit for approaching cars, but thought that no other car would be following closely upon the regular passenger car. After entering upon the portion of the highway traversed by defendant’s tracks, he followed the track, according to his testimony,- 204 feet, when he was struck by the defendant’s train.
The motorneer was called as a witness for the defendant, and testified that he saw the two boys when they were in the middle of the road, and that when he was within a couple of hundred feet of them they turned on the track with their cart; that he at once sounded the gong, and tried to attract their attention, and stop his train, as soon as they were on the track; that when within 20 feet of them they happened to hear the gong, looked up, and tried to jump off the track; that they were both clear of the rails, but the cart caught on the outside rail as they tried to get off, and the train struck the cart and cut plaintiff’s arm off. In another portion of his testimony the witness states that the boys got on the track in front of Mr. Reuhle’s place, which, as would appear from the map introduced, is a point nearer Detroit than that given by the plaintiff himself, so that, if the plaintiff entered upon the track at Reuhle’s, he must have traveled on the track a greater distance than 204 feet.
There was testimony tending to show that the gong-was not sounded, and also tending to show that the car ran a considerable distance after the plaintiff was struck, indicating that it had a considerable speed, and had not been brought under control. The defendant’s testimony disputed both these claims-. The circuit judge expressed the opinion that there was sufficient evidence to justify submitting the case to the jury upon the question of defendant’s negligence, but he withdrew the case from the jury upon the ground that the plaintiff was conclusively shown to be guilty of contributory negligence.
If the defendant’s testimony as to the facts were to be credited and accepted as true, the plaintiff was undoubtedlyguilty of negligence contributing to the injury. But if, on the other hand, the plaintiff, after entering upon the track, was pursuing his way on this public highway, in full view of the motorneer, for a distance of 204 feet, we are not prepared to hold, as a matter of law, that he was guilty of contributory negligence. This is not a steam railroad. The plaintiff was in no sense a trespasser. This railroad company occupies a portion of the public highway. Travelers have the right to continue to travel upon this highway, and are not to be treated as trespassers; and if, after discovering that the plaintiff was upon the track, the motorneer failed to take proper precautions to prevent injury to him, a precedent negligence of the plaintiff, if there was any, constitutes no defense. Richter v. Harper, 95 Mich. 225 (54 N. W. 768). His presence there would furnish an opportunity for injury, but would not be, in any legal sense, a contributing( cause to it. It is immaterial whether he had been pursuing his course on this highway, and within the lines of the railway tracks, for 204 feet or for half a mile, as it affects the negligence of defendant in running him down, provided he was upon the track a sufficient length of time, in full view of the motorneer, so that, by a proper control of his train, he could have prevented the injury, or have given plaintiff notice in time to avoid the injury.
The defendant relies, in support of the ruling of the court below, upon the cases of Fritz v. Railway Co., 105 Mich. 50 (62 N. W. 1007); Doherty v. Railway Co., 118 Mich. 209 (76 N, W. 377, 80 N. W. 36); and Borschall v. Railway, 115 Mich. 473 (73 N. W. 551). In none of these cases were the facts • analogous to the case under consideration. These were cases in which it appeared that the 'attempt to cross the track was sudden, and unexpected to the motorneer. The element of a traveler lawfully pursuing his way ahead of the car, and in the same direction as the car, was not present.
The question in this case was recently considered by this court, and ruled adversely to the contention of the defendant’s counsel, in Tunison v. Weadock, ante, 141 (89 N. W. 703), in which case attention was directed to the fact that Fritz v. Railway Co. had been previously distinguished by this court, in an opinion by Mr. Justice Long, in Rouse v. Railway, 128 Mich. 149 (87 N. W. 68). See, also, as further supporting the views here expressed: Little v. Railway Co., 78 Mich. 205 (44 N. W. 137); Rascher v. Railway Co., 90 Mich. 413 (51 N. W. 463, 30 Am. St. Rep. 447); Laethem v. Railway Co., 100 Mich. 297 (58 N. W. 996); Bush v. Railway Co., 113 Mich. 513 (71 N. W. 851); Blakeslee v. Railway Co., 112 Mich. 63 (70 N. W. 408); McClellan v. Railway Co., 105 Mich. 101 (62 N. W. 1025).
The judgment will be reversed, and a new trial ordered.
Moore, J., concurred with Montgomery, J.
Hooker, C. J.
I think that the questions of negligence and contributory negligence should have been submitted to the jury, and therefore concur in the reversal of the judgment. | [
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Starr, J.
Defendant appeals from award of the department of labor and industry, entered December 27, 1940, granting plaintiff further compensation of $12.80 per week for partial disability. Such award reversed an order of the deputy commissioner denying plaintiff further compensation, on the ground that plaintiff’s loss of wages “was due to his being confined as a leper and not because of any disability in his hand and forearm.”
On about August 14, 1929 (sometimes stated in the record as September 14, 1929), while employed on a piston grinding machine in defendant’s plant, plaintiff, an experienced workman, sustained accidental injury to his right hand. His injury was treated, and in a few days he returned to other work not requiring use of his right hand. He lost no compensable time and continued at favored work until he was discharged several months later.
In October, 1932, plaintiff filed application for compensation; and on January 23, 1933, the department determined that plaintiff had “suffered an accident which arose out of and in the course of his employment with said defendant, ’ ’ and awarded him compensation for partial disability at the rate of $12.80 per week, such payments beginning December 29, 1932. No appeal was taken. Payments were made until February 23, 1934, when the parties entered into a supplemental agreement, approved by the department, providing:
“And it is now hereby agreed that in the opinion of all the parties hereto, that disability has ended, and that because thereof payment of all further compensation shall stand suspended from and after February 15, 1934.
“It is further agreed that if further disability from such injuries shall hereafter develop, this agreement shall not bar plaintiff’s rights to petition the department for such further and added compensation as he may be entitled to; that on the hearing of such petition the plaintiff shall bear the burden of proof, and the department shall determine such petition according to the facts,”
In pursuance of such agreement plaintiff returned to work at defendant’s plant and continued at favored work, one-hand jobs, until June, 1937, when he was found to have leprosy and was removed to the leper colony at the United'States Marine Hospital, Carville, Louisiana. He has been confined there ever since.
On about February 3, 1939, plaintiff filed petition for further compensation, alleging, in part:
“Tour petitioner further represents that because of the accident there is an atrophy of the muscles of the right hand and arm with a resultant effect on the nerves and muscles. That such condition was and is permanent and progressive. That in an effort to aid in rehabilitation, a supplemental agreement was entered into on February 23, 1934, suspending payments and petitioner was employed by the Ford Motor Company at such labor as he was able to perform until June 15, 1937. That from the date of said injury and to the present time and for the balance of his life, he will suffer the disability to a greater extent than on the date of said award. That since June, 1937, he has not had the employment as contemplated by the efforts of his rehabilitation, and is entitled to compensation from June 15, 1937, in accordance with the award heretofore entered. ” •
Defendant filed denial of liability for further compensation, on the ground that the “disability (if any) is not the result of an accidental injury arising ont of and in the'course of his employment,” and that the “case is res judicata because of approved settlement receipt of February 23, 1934.”
On April 23, 1940, the depositions of plaintiff, Dr. Hasseltine, and Dr. McCreary were taken at the marine hospital in Carville, Louisiana. The matter was heard before a deputy commissioner in June, 1940. Plaintiff testified, as shown by his deposition, that, when he returned to work for defendant in February, 1934, he could not do the same kind of work as before his injury; that his work was light work, one-hand jobs, hanging pistons on the line, picking up towels, doing some machine painting, greasing machines, picking up pieces of brass and steel; that on several occasions foremen or superintendents complained that plaintiff could not do his work satisfactorily and he was sent to the employment office and changed to other work; that at the time of his injury in 1929, he was paid $6.80 per day for grinding pistons; that, when he became ill in June, 1937, his pay was $7.40 a day; that his employment with defendant ceased when he became sick with leprosy in June, 1937. Plaintiff further testified:
“Q. At the time you signed the supplemental agreement, did you have the full and complete use of your right hand?
“A. No, I never had since I got hurt; it gets worse every day.
“Q. Did you have a lesser or greater use of your right hand at the time of signing the supplemental agreement than you had at the time of securing the award?
“A. About the same.
“Q. State whether or not you have at any time had the full use of your right hand since the date of the award.
“A. I have never had.
“ Q. State if you have had any difficulty in the use of your injured hand and arm from the date of the award to the present time.
“A. My fingers are all crooked. * * *
“Q. State what difficulty, if any, you have had in the use of your injured hand from the date of the award to the present time.
“A. I can’t hold a pencil and anything I pick up I drop since two months after I got hurt.
“I can’t use my hand to write and do other things and can’t use it to work. * * *
“Q. Can you use your left hand freely? .
“A. Yes, for anything.
“Q. How about your right and left legs ?
“A. They are all right. * * * ■
“Q. You say that you can’t stretch out your fingers because of the injury you have received, is that correct?
“A. Yes.
“ Q. You have said that the injury you received in 1929 is about the same now as it was then.
“A. It is the same.”
Dr. McCreary of the marine hospital staff testified, in substance, that plaintiff had been under his observation “continuously” and that he had examined plaintiff’s injured hand several times; that in his opinion plaintiff’s injury did not cause the leprosy and would not hasten its development; that the injury had no bearing on the disease of leprosy; that the condition of plaintiff’s hand was about the same as, no better nor any worse than, when he was admitted to the hospital. Dr. McCreary further testified:
“Q. Will you please state the condition of his right hand at the time of the physical examination?
“A. There was a contraction of the hand, you might say a moderate main-en-griffe, as we say in leprosy, including all fingers. There was atrophy of the small muscles of the hand, the interosseous and lumbrical muscles; the skin was dry and scaley, and there was complete anesthesia to pain and temperature.
“Q. State what use at the time of the examination Mr. Sotomayor had of his right hand and arm.
“A. The use of the hand would be rather limited for work; he could with some effort dress himself; he could hold his tray going to the dining room but there was very little strength in the right hand. I don’t know about the arm; the disability is in the hand instead of the arm. * * *
“Q. Could the difficulty sustained by Mr. Soto-mayor at the time you examined him be caused by trauma? * * *
“A. Yes, it could.
“Q. State whether or not from your knowledge of the history of this case same was caused by trauma. * # *
“A. From my knowledge, I don’t know. From the record there was an interim of seven years between injury and his admission here, and lots of things could happen.”
Dr. Hasseltine, medical director of the United States Public Health Service at the marine hospital, testified that plaintiff’s injury would not cause, nor would it hasten the development of, leprosy; that the scars on plaintiff’s hand were probably caused by something other than leprosy; that plaintiff could get permission from the surgeon general to travel on a common carrier, with an attendant. Dr. Hasseltine further testified:
“Q. From your knowledge, could you give the reasons for any difficulty, if any, of Mr. Sotomayor in the use of his right hand? * * *
“A. There is evidence of nerve damage resulting in contracture of the fingers and loss of sensation in the hand and fingers. This interferes with the execution of fine muscular movements and certain functions dependent on the normal sense of feeling in the skin of the fingers.
“Q. Is the present condition of Mr. Sotomayor’s right hand caused by trauma? * # *
“A. I cannot answer that definitely. It may be caused by trauma, by other conditions, or both. * * *
“Q. Could you state, of your own knowledge, in the case of Mr. Sotomayor, if there has been any improvement in his hand since your first examination?
“A. The improvement is questionable; if any, it is so slight as to be negligible. * * *
“Q. What effect, if any, would leprosy have on injuries of the kind mentioned in the case of Mr. Sotomayor? * * *
“A. It might increase deformity and disability.’ ’
Dr. Brietenbach, witness for plaintiff, who examined him in December, 1932, testified:
“Q. What was the condition of the hand at that time? * # *
“A. His history to me. ‘His chief complaint, sensory motor paralysis of the right hand and forearm. Sort of a claw. What we call sort of a claw hand. My functional diagnosis was trophic degeneration due to nerve and muscle injury.
‘ ‘ That was the diagnosis I made. * * *
“Q. The injury to the hand as you examined it in 1932, would you say that was—
“A. There were scars. Injury occurred in 1929. There were scars on his hand, and there evidently had been — in order to cause this atrophy of the muscles, and what we call a claw hand. That is a contraction of the ligaments. And the muscles at' that time had become somewhat smaller, and up the arm there was some degeneration of the muscles. Of course, subjectively he complained of pain. That’s a subjective thing. And objectively, there evidently had been some sufficient injury which had gradually extended from the muscles of his fingers up into his forearm, and weakened it and made it smaller, and certainly he had no strength. We tried to have bim pick up some things in the court. _ Do you remember, the judge handed him some things and he couldn’t even hold them.”
When plaintiff was being tested for leprosy in 1937, Dr. Brietenbach. again examined him. He testified:
“Q. But as far as appearance of the hand, it looked about the same?
“A. About the same as I have ever seen it. He could not manipulate it with facility. The claw hammer effect was there. * * *
“A. Personally I have no doubt at the time I examined him that he had a progressive atrophy of the muscles due to nerve injury. I didn’t think there was any doubt about it, and I didn’t think there was any doubt about it when I saw him again, and I didn’t think there was any hope for improvement, and rather expected just from my knowledge of these things, it might even progress, and get worse. ’ ’
Dr. Hunter, witness for defendant, testified that he examined and treated plaintiff in 1937, and after several months of treatment diagnosed his illness as leprosy. He further testified:
“Q. This claw hand you have told us about that there is atrophy of the muscles there.
“A. That'is a contracture of the tendons. The tendons on the dorsum of the hand pulled back in such a way as to over extend the first phalanges— first bone in the fingers, and flex the others, giving the appearance of a claw._ It resembles something of the ulnar nerve paralysis.
“Q. Now in leprosy you say it is known as leper-claw?
“A. Leper-claw.
“Q. How does leprosy affect the nerves or the control of the hand?
“A. Well, leprosy involving the nerves gradually produce an anesthetic effect on the nerves and they become paralyzed, and you get trophic degeneration, or trophic changes in the tissues that were supplied by these nerves, because the nerves are dead, and the nutrition of the tissues is changed. We call it trophic changes in the parts.
“Q. Ho you feel that the claw hand that this man has was the result of a nerve injury due to trauma?
“A. After I made the diagnosis I understood the case clearly. At first I didn’t understand just what was causing that in his hand. I couldn’t see a scar or anything as evidence of trauma to account for it, and I didn’t pay a great deal more attention to it until I finally made the diagnosis. Then I could see the whole picture was very clear. Symptoms of the hand, ulcerations, anesthesia, the facies, and all fit perfectly with the diagnosis of leprosy. # * *
“The Commissioner: And as I understand the question proposed by Mr. Starkey is in substance this: Could this accident of 1929 either have caused or precipitated the condition of leprosy found in May, 1937. * * *
“A. The injury would not have any effect at all on the leprosy. Vice versa, the fact that he was developing leprosy may have caused him to get the injury. Caused the anesthesia, — anesthetic effects on his hands and nerves due to leprosy might make him more susceptible to injury. * * *
“Q. Doctor, when you examined him in May, 1937, was there a disability in that hand?
“A. He had a claw hand effect, and I remember that time, him burning himself all the time with cigarettes.”
The deputy commissioner denied plaintiff’s petition for further compensation, saying:
“Petition denied because plaintiff’s loss of wages from June 4, 1937? until the end of the 500-week period, to-wit, April 26, 1939, was due to his being-confined as a leper and not because of any disability in his hand and forearm.”
On review the department of labor and industry reversed the finding of the deputy commissioner and awarded plaintiff compensation for partial disability at the rate of $12.80 per week from June 3, 1937, to the end of the 500-week compensable period. The opinion of the department stated, in part:
“In 1932 he brought proceedings for compensation and on January 23,1933, an award was entered giving him compensation at the rate of $12.80 per week for partial disability from December 29, 1932, and until the further order of the department. The award was not appealed from and he was paid compensation until February 15, 1934, when it was stopped in accordance with a supplemental agreement. The plaintiff had not recovered from his' disability at the time compensation ioas stopped, but was returned to work on that day by the defendant at work favoring his condition. He continued with the defendant at favored employment until June 3, 1937, when he was found to have leprosy and he has since been confined in the leper colony at Carville, Louisiana. On February 3, 1939, he filed a petition for further compensation and Deputy Commissioner McAuliffe entered an award denying such petition and the matter is now before us upon the plaintiff’s claim for review.
“The plaintiff seeks compensation for the period from June 3, 1937, the day of the last employment by the defendant, until the end of the 500-week compensable period. His leprosy is not related to the accident and has caused his confinement in the
Louisiana colony. However, he still has a claw hand resulting from a nerve injury and this condition is disabling in and of itself independent of his leprosy. It is not seriously disputed that the hand condition is disabling, but the defendant contends that it was due in the beginning to the onset of leprosy and not to the accidental injury. In our opinion, the defendant’s position is not tenable for the reason that the question has already been adjudicated. The award entered January 23, 1933, was a final determination that the plaintiff’s disability at that time was due to his accident. Insofar as this case is concerned the disability then was the same as it is now, namely, a claw hand resulting from a nerve injury. To find at this time that such disability was not related to the accident would be to reverse a former award and to grant a rehearing; this we are not privileged to do.
“If it was clearly apparent at this time that the cause of plaintiff’s disabled hand was leprosy and not his accident, we might have the same situation that was presented in the case of Romanchuk v. Ford Motor Co., 290 Mich. 673. However, in our opinion there has been no satisfactory showing in that regard. It is true that nerve injury causing a claw hand may be the first evidence of beginning leprosy, however, it is equally true that the nerve injury causing the claw hand might have been a purely natural development from the accident. The plaintiff was not found to have leprosy until 1937 or more than five years after the development of the disability. We do not know that the plaintiff had leprosy at that time. We do know that he had had an accident and are unable to eliminate it from the picture or to find that the leprosy was the sole cause. In our opinion, it has already been determined that the plaintiff’s disabled hand condition is due to his accidental injury and we are bound by that adjudication.
“The plaintiff was working at the time his leprosy was discovered. He could have continued working at Ms favored employment except for Ms leprosy. ¥e do not believe tMs defeats Ms right ■to compensation.”
The order of the department entered December 27, 1940, provided, in part:
“This cause having been heard by the department on appeal of the plaintiff from the award of the deputy commissioner entered on September 9, 1940, denying compensation to the plaintiff; after due consideration of the evidence taken and the arguments and briefs of counsel (the department having made a finding of facts and law) and it appearing to this department that the award made, as aforesaid, should be reversed;
“Therefore, it is ordered, that the award of the deputy commissioner should be and the same is hereby reversed and that plaintiff shall be paid by the defendant compensation for partial disability at the rate of $12.80 per week from June 13, 1937, and until the end of the 500-week compensation period.”
Defendant, having obtained leave to appeal, contends (1) that plaintiff should be denied compensation for the reason that his loss of wages is due to disease rather than to injury; and (2) that the department of labor and industry, by failing to require plaintiff to submit to a physical examination, deprived defendant of “its day in court.”
The department, by its award January 23, 1933, from which no app.eal was taken, determined that plaintiff had suffered a compensable injury. The department, by its opinion and award of December 27, 1940, determined that plaintiff “still has a claw hand resulting from a nerve injury and this condition is disabling in and of itself independent of his leprosy. ’ ’ The department determined that plaintiff was continued by defendant at “favored employ ment” from the time compensation was discontinued in February, 1934, until-he ceased work, because of his leprous condition, June 3, 1937. Such findings of fact by the department were supported by competent testimony and are conclusive. We review questions of law but not issues of fact, 2 Comp. Laws 1929, § 8451 (Stat. Ann. § 17.186); Lynch v. R. D. Baker Construction Co., 297 Mich. 1; Donahoe v. Ford Motor Co., 295 Mich. 422; Neumeier v. City of Menominee, 293 Mich. 646; Smith v. Pontiac Motor Car Co., 277 Mich. 652.
By working at “favored employment” from February, 1934, until June 3, 1937, when he was found to have leprosy, plaintiff did not establish a so-called ‘ ‘earning capacity” at his former employment of grinding pistons or at any other work. The award of compensation was for the injury to plaintiff’s hand; and his having worked at such “favored employment,” though he was paid more than at the time of his injury, does not bar his right to compensation. Smith v. Pontiac Motor Car Co., supra; Murray v. Ford Motor Co., 296 Mich. 348; Donahoe v. Ford Motor Co., supra. See, also, McDonald v. Great Lakes Steel Corp., 268 Mich. 591; Hood v. Wyandotte Oil & Fat Co., 272 Mich 190.
The fact that plaintiff is confined in the leper colony by health authorities and is thereby prevented from working at “favored employment” does not defeat his right to compensation for his continuing hand injury. The liability to pay compensation for partial disability has been determined by the department of labor and industry and the supervening leprosy and resulting confinement does not relieve defendant from such adjudicated liability.
In the case of Ward v. Heth Brothers, 212 Mich. 180, plaintiff, while receiving compensation for par tial disability, was' committed as a mental patient to the Kalamazoo State Hospital. The defendant filed petition to be relieved from payment of further compensation, on the ground that plaintiff’s disability and incapacity to perform work was due to his diseased brain condition and resulting hospitalization, and not to his accident. Mr. Justice Stone, writing for affirmance of the order denying defendant’s petition, said, p. 198:
“Counsel for plaintiff discuss the question whether the defendants are released from liability to pay compensation because of the supervening insanity of the plaintiff; and they urge in argument that after the liability to pay compensation has become fixed, no supervening infirmity or insanity of plaintiff will relieve the employer or his insurer from the liability to continue paying- compensation according to the terms of the award as originally, made. And the following cases are cited: Eaves v. Blaenclydach Colliery Co., 2 K. B. [1909] 73; Hartwood v. Wyken Colliery Co., 2 K. B. [1913] 158; McNally v. Furness, Withy & Co., 3 K. B. [1913] 605; Walsh’s Case, 227 Mass. 341 (116 N. E. 496, 6 A. L. R. 567).
“We doubt if defendants really claim that, simply, the intervening insanity would relieve them from liability. We understand their real position to be that the disability from which claimant has suffered since April 23, 1919, was due to disease and not the injury of February 12, 1916. However, we are of the opinion that the position of plaintiff upon that subject is fully sustained by the authorities cited. In other words, that the supervening insanity of the plaintiff does not justify defendants in stopping payment of compensation.”
See, also, Neal v. Stuart Foundry Co., 250 Mich. 46; Williams v. Cwmaman Coal Co., Ltd., (1927) W. C. & Ins. Rep. 318, 20 B. W. C. C. 476 (Court of Appeal, Eng. [1927]).
In the case of Romanchuk v. Ford Motor Co., supra, relied upon by defendant, the majority opinion stated, pp. 677, 678:
“The award made was for what was ultimately found to be the matter with plaintiff who had thought with good reason and claimed that something else was the matter.”
Under such decision defendant could introduce proof that the condition of plaintiff’s hand was due to his leprosy and not to the accidental injury. However, the department, after hearing proofs of tlie leprous condition, determined that the continuing disabled condition of plaintiff’s hand was due to the injury; and such determination of fact is final.
Defendant contends that plaintiff, by failing to report in Detroit on February 28, 1939', for physical examination, forfeited his right to further compensation, and that the failure of the department to require plaintiff to submit to an examination deprived defendant of a full and complete hearing and of “its day in court.”
Section 8435, 2 Comp. Laws 1929 (Stat. Ann. §17.169), provides:
“After an employee has given notice of an injury, as provided by this act, and from time to time thereafter during the continuance of his disability, he shall, if so requested by the employer, or the insurance company carrying’ such risk, or the commissioner of insurance, as the case may be, submit himself to an examination by a physician or surgeon authorized to practice medicine under the laws of the State, furnished and paid for by the employer, or the insurance company carrying such risk, or the commissioner of insurance, as the case may be. The employee shall have the right to have a physician provided and paid for by himself present at the examination. If he refuses to submit himself for the examination, or in any way obstructs the same, his right to compensation shall be suspended, and his compensation during the period of suspension may be forfeited. Any physician who shall make or be present at any such examination may be required to testify under oath as to the results thereof.”
The record indicates that on about February 25, 1939, while confined in the leper colony, plaintiff received notice or citation from defendant to report in Detroit on February 28, 1939, for physical examination. The record does not contain copy of the notice or citation. There is no satisfactory proof as to when the same was issued or when it was served on plaintiff. During the hearing defendant’s counsel stated:
“Our citation was dated February 23, 1939, instructing him to appear before Dr. Kennedy, at 10 Peterboro avenue, Detroit, Michigan, on February 28, 1939.”
Plaintiff’s counsel filed sworn petition for continuance, which stated, in part:
“Now comes the above-named plaintiff, by one of his attorneys, Clarence Gr. Hill, and respectfully shows unto the board that the above-named defendant, as he' is informed and believes, has full knowledge of the fact that the plaintiff is a leper and confined in the Lepers’ Colony at Carville, Louisiana; that on, to-wit, February 25, 1939, the said plaintiff received a letter requiring him to be in Detroit on February 28 at 2 o’clock, p. m., for an examination by Dr. Charles S. Kennedy of 10 Peterboro street.
“Your petitioner further shows that the above information was received by him (counsel) on, to-wit, March 2, 1939, and at a time too late to arrange for such an examination, should such be necessary under the law and rules of practice of this board before a hearing.
“Your petitioner further prays the board to continue the hearing on said cause to permit of a reasonable opportunity for the taking of any deposition that may be deemed necessary by.the parties hereto and/or the commissioner hearing the cause and/or such examination as defendant is entitled to under the law involved in this case.”
Plaintiff testified that he was willing to submit to a physical examination by defendant’s physician, provided such examination be made under conditions with which he would be able to comply. So far as the record shows, plaintiff was given only three-days’ notice to make preparations and to report in Detroit for examination. He could leave the leper colony and travel to Detroit only after having obtained permission from the surgeon general of the United States, and if accompanied by an attendant. It was apparently a physical impossibility for plaintiff to report for the examination on February 28, 1939, and he should not be penalized for his failure to do so. Plaintiff did not, we believe, under the above-quoted statute, “refuse to submit himself for the examination, or in any way obstruct the same.” The record shows no further effort by defendant to obtain physical examination of plaintiff, though more than a year elapsed between the service of the citation on February 25, 1939, and the hearing before the deputy commissioner on June 13, 1940.
Counsel for defendant rely upon the case of Sauch v. Studebaker Corporation, 232 Mich. 147 (41 A. L. R. 863), in which we said, p. 152:
“The section involved here, requiring an employee claiming or receiving compensation for an indus trial accident to submit himself ‘to an examination by a physician or surgeon authorized to practice medicine under the laws of this State’ when properly requested by his employer or the insurance company carrying the risk, distinctly provides if he refuses to so submit himself to ‘or in any way obstructs’ such examination his right to compensation ‘shall be suspended,’ and his compensation during the period of suspension ‘may be forfeited.’ * * * The statute contains no exceptions or qualifying language. ’ ’
Such decision recognizes that the employee must be “properly requested by his employer or the insurance company” to submit to physical examination. We conclude that in the present case there is no proof that defendant “properly requested” plaintiff to submit to such examination.
The supplemental agreement between the parties on February 23,1934, under which plaintiff returned to work-at favored employment, is not, as contended by defendant, res judicata of plaintiff’s right to further compensation.
The award of the department is affirmed; with costs to plaintiff.
Chandler, C. J., and North and Bushnell, JJ., concurred with Starr, J.
Boyles, J.
There is no foundation in fact to support the finding of the department to the effect that plaintiff’s disability to continue work from and after June 3, 1937, was due to an accidental injury received during the course of his employment. A mere statement of the admitted facts shows a complete absence of any testimony to support such a finding.
In 1929 plaintiff suffered a compensable injury to his right thumb while an employee of defendant. He continued to work for defendant and in 1933 was awarded compensation for partial disability arising out of the accident. The injury had developed into what is referred to in the record as a claw hand. In 1934 an agreement was filed, and approved by the department, that disability had ended and further compensation be suspended. Plaintiff continued to work for defendant until June 3, 1937. Although working at favored employment, plaintiff at that time was earning more than at any previous time. On June 3,1937, plaintiff was compelled to quit work because he was found to be a leper. By reason thereof, he was removed to a leper colony in Louisiana where he has been continuously confined since. It is undisputed — in fact, the department found— that he could have continued working except for his leprosy. The plaintiff himself testified he never missed any work from 1934 to June 3,1937, at which time he left because the doctor said he had leprosy. From 1934 to 1937 plaintiff was not receiving compensation and we have no finding of disability during that period. The case is readily distinguishable from Neal v. Stuart Foundry Co., 250 Mich. 46, and Ward v. Heth Brothers, 212 Mich. 180, where the plaintiff was receiving compensation for partial disability when his employment was terminated, and the employer in each case petitioned to be relieved from further compensation. In those cases, loss of earnings (partial disability) was still traceable to and the result of the accident. See, also, Barnot v. Ford Motor Co., 282 Mich. 37. In the case at bar, the injury to the hand and the reason for termination of employment, viz: leprosy, had no connection whatever with each other. The leprosy was not caused by or traceable to the injury, and the disability in 1929, or any time previous to June 3,1937, had no possible connection with leprosy. Were it not for leprosy, plaintiff could have continued to worlc at the same or similar employment, at the same or higher wages, in which event there would be no basis for a resumption of compensation.
The award should be set aside.
Wiest, Butzel, and Sharpe, JJ., concurred with Boyles, J.
The powers and duties of the industrial accident board, here referred to, have been transferred to the department of labor and industry and the board abolished. See 2 Comp. Laws 1929, § 8312 (Stat. Ann. § 17.3).—Reporter.
See footnote, ante, 122.—Reporter. | [
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North, J.
Miss Carrie Gr. Plank, unmarried and a retired school teacher, died intestate January 5, 1940, at the home of her nephew, defendant J. Baymond Plank, in Grand Eapids. She was past 82 years of age and had been living in the home of her nephew Baymond since December 2, 1938. Approximately 5 weeks after going to live in Baymond’s home, Carrie G. Plank so arranged the title to both her real and personal property that it was held jointly between her and the nephew Baymond with right of survivorship. Aside from the disinterested administrator of the estate of Carrie G. Plank, deceased, the plaintiffs herein are William V. Plank and Howard A. Plank, two other nephews of the deceased. They and the defendant J. Baymond Plank are the sole heirs at law of Carrie G. Plank, deceased. By their bill of complaint the two nephews who are plaintiffs seek cancellation of the transactions whereby defendant J. Baymond Plank became the joint owner with right of survivorship in the property of the aunt, Carrie G. Plank. We quote from plaintiffs’ brief:
“Plaintiffs claim the transactions resulting in J. Raymond Plank’s acquisition of his aged aunt’s property are void because of fraud practiced in a fiduciary relationship, whereby J. Raymond Plank defrauded his brothers out of their inheritances.”
After full hearing in the circuit court, a decree was entered which dismissed plaintiffs’ bill of complaint. They have appealed.
It is first claimed that under the record made the trial court was in error in not holding that the challenged transactions through which defendant J. Raymond Plank obtained an interest in the property of deceased were effected through fraud and undue influence which rendered them invalid as against the rights of the other heirs. As bearing upon this phase of the case the following facts, among others, may be noted.
Because of ill health Miss Carrie G. Plank in December, 1938, went to live in the home of her nephew J. Raymond Plank. She was given excellent care and in a large measure regained her health. She shortly resumed such activities as going about the city of Grand Rapids, visiting friends, teaching a Sunday school class, et cetera. Seemingly because she so preferred, she continued to reside in the home of her nephew Raymond until her death in January, 1940. There is not, nor under the record could there be, any question about Miss Plank’s mental capacity at the time of the transactions of which plaintiffs complain or for months thereafter. At the time Miss Plank went to live with Raymond she owned a house and lot of moderate value on Second street in Grand Rapids. About 5 weeks after going to live with Raymond Miss Plank through a lawyer with whom she had consulted placed title to this real estate jointly in herself and J. Raymond Plank with right of survivorship. 'The deeds evidencing the transaction were promptly recorded by the attorney. The record discloses that even prior to her going to reside in the home of the nephew, Raymond, Miss Plank had been advising or at least attempting to advise with her legal counsel as to making some disposition of her property by will or otherwise. At this time Miss Plank had on deposit in the Old Kent Bank of Grand Rapids $510.78; an account in the Mutual Home Federal Savings & Loan Association of $2,270.07; in the West Side Federal Savings & Loan of $1,310.71; and in the State Savings Association of $2,011.70. With the exception of setting aside a specific sum for the expenses of her funeral and burial, Miss Plank, after communicating to her attorney her intention so to do and advising with him, went to the respective financial institutions 'and changed her accounts in such a manner as made them joint with her nephew Raymond and with right of survivorship. In each instance she was definitely advised by officers of the institution as to the effect of carrying out this plan; but she clearly indicated her desire to have the changes made. During the remaining months of her life she made no effort to nullify any of the above-noted transactions. Obviously she could have withdrawn these funds and reinvested them in her own name. Notwithstanding the nephews who are plaintiffs herein knew of these transactions for an appreciable time before the death of their aunt they neither instituted nor caused her to institute any proceedings during her lifetime wherein the validity of these transactions, was assailed.
The alleged fraud in consequence of which the plaintiff nephews assert that defendant J. Raymond Plank obtained his interest in the property of 'the aunt in substance is as follows. For some years prior to her coming to Raymond’s home, Carrie Plank lived with another retired school teacher, seemingly on something of a cooperative basis. It is claimed that in September, 1939, Miss Plank told her nephew Howard and his wife that Raymond had told his Aunt Carrie that the other retired school teacher with whom she had lived was going to sue her for room and board for all the time she had lived there and had not paid. Evidently the plan devised to defeat the enforcement of such an obligation against Miss Carrie Plank was to place her property jointly in the name of herself and nephew Raymond. The fraud asserted, at least by implication, is that such a claim against Miss Plank or her estate had not been contemplated by the other retired school teacher with whom Miss Plank had lived. The facts and circumstances alleged to have constituted this fraud were denied by defendant J. Raymond Plank.
“I never made any statement of any kind to my Aunt Carrie that Frances YanBuren might sue her, more than likely would sue her, or anything of that kind for board and keep, room rent and things of •that kind. I never requested or suggested that Aunt Carrie should cover up her property in any way so that Miss YanBuren would not be able to collect any judgments she got against her. I never held any conversation along this line with Aunt Carrie, and she never said anything about it to me.”
There is testimony disclosing many other facts and circumstances which bear pro or con upon the controverted issues of fraud and undue influence; but no purpose would be served by attempting to review them in detail herein. The opinion filed by the trial judge covers nearly 20 pages of the printed record. He gave careful consideration to every aspect of the ease. His conclusion that neither mental incapacity, undue influence nor fraud were established is well supported by the record and must be affirmed.
Further, the record does not sustain appellants’ contention that at the time of the challenged transactions there existed such a fiduciary relation between Miss Plank and the defendant J. Raymond Plank that the burden of disproving fraud or undue influence was upon defendants. It is true that Miss Plank was then and for a few weeks had been living in the home of defendant J. Raymond Plank, but at that time she was paying for the services so rendered her. We are aware of the fact that on some isolated occasions defendant J. Raymond Plank had advised or assisted his Aunt Carrie in some of her business transactions. But at and immediately pr,ior to the transactions assailed in the instant case Miss Plank had the advantage of the advice of her own counsel as well a,s of officials in the financial institutions wherein she had accounts; and further, it convincingly appears from this record that at that time and for months thereafter Miss Plank was fully competent and able to manage her own affairs.
Appellants contend that the testimony of the attorney with whom Miss Plank advised and who prepared the deeds to which reference has hereinbefore been made was incompetent as to matters equally within the knowledge of the deceased and that its admission was prejudicial error. In this connection it is stated in appellants’ brief:
“Carrie G-. Plank never had independent legal counsel. Instead, J. Raymond Plank’s lawyer was her adviser and that lawyer admitted the chai lenged instruments were made by reason of his advice and that counsel was allowed, over appellants’ objection, to detail at great length in his testimony the alleged reasons Carrie Gr. Plank gave for doing what she did.”
This contention on the part of appellants is based upon the following erroneous statement quoted from their brief: “In the case at bar, there can be no question that Mr. Dilley [the attorney] was the agent of J. Raymond Plank.” While the record discloses that on previous and subsequent occasions this attorney had served Mr. J. Raymond Plank professionally, it also appears, and there is no contradicting testimony, that in the transactions challenged in this suit Miss Carrie Plank of her own volition sought and acted upon the advice of this attorney. In these transactions the attorney was representing Miss Plank, and not J. Raymond Plank. Aspersions cast upon the attorney to the contrary are not justified by this record. The objection urged by appellants is based upon the statutory provision which in part reads:
“No person who shall have acted as an agent in the making or continuing of a contract with any person who may have died, shall be a competent witness in any suit involving such contract, as to matters occurring prior to the death of such decedent, on behalf of the principal to such contract against the legal representatives or heirs of such decedent, unless he shall be called by such heirs or legal representatives.” 3 Comp. Laws 1929, §14219 (Stat. Ann. §27.914).
While we do not place decision on that ground, it should be noted in passing that this attorney was called as a witness in this case for cross-examination by appellants. Holding, as we do, that in the trans actions involved in this suit the attorney was the agent of Miss Carrie Gr. Plank, the admissibility of his evidence is controlled by our decision in Lammie v. King, 264 Mich. 323, wherein Mr. Justice Butzel writing for the Court said:
“The inhibition of the statute does not affect the testimony of agents ,of the deceased, but is applicable only to that of agents of parties who may have dealt with the deceased.”
In Cutter v. Powers, 200 Mich. 375, at page 385, we said:
“It is permissible, and often the agent of one party to a transaction is appointed by the adverse party as his agent for certain purposes, and each party will then stand in the relation of principal to the agent as to the matters by him entrusted to the agent, and as to those alone. 2 C. J. p. 448. This rule has been frequently asserted by this court.”
Nor do we think the statutory provision applies to an agent merely because he is made a party de-. fendant, if the trial of the case discloses, as in the instant case, that plaintiffs are not entitled to any relief against such agent.
Our holdings in Re Peterson’s Estate, 239 Mich. 452, and in Lilly v. Schmock, 297 Mich. 513, are controlling as to J. Raymond Plank’s right as a survivor of Carrie Gr. Plank to take in his sole right the accounts made in their joint names. Such accounts are provided for by statute. 3 Comp. Laws 1929, § 12140, as amended by Act No. 135, Pub. Acts 1931 (Comp. Laws Supp. 1940, § 12140, Stat. Ann. § 23.547); Act No. 77, § Í, Pub. Acts 1939 (Comp. Laws Supp. 1940, § 12170-4, Stat. Ann. 1941 Cum. Supp. §23.584). As to two of the three savings and loan accounts to which defendant J. Raymond Plank asserts joint title with sole right as sur vivor, it is sufficient to note that Miss Plank in her lifetime altered these two accounts in such a manner as brought them literally within the terms of the cited statutes; and as to these two accounts Raymond became a joint owner with right of survivorship. In changing her account in the third savings and loan association the following form was used:
“For a valuable consideration, to me in hand paid by Carrie and J. Raymond Plank, aunt and nephew, I hereby sell and assign to them all my right, title and interest in and to the shares in the Mutual Home Federal Savings & Loan Association represented by this Passbook No. 1638.”
The above assignment was witnessed by J. W. Leslie, the president of this association.^ Touching the circumstances of the change of this account, he testified:
“I explained to Carrie Plank in detail the wording on our signature card, of a joint card which she had signed, that it meant that either one could draw from the account at any time during the life of either, or after their death. She was satisfied with it.”
It may be noted that in changing this particular account, unlike the others, nothing was written in the assignment as to a right of survivorship. But we think under the circumstances of this case it quite conclusively appears Miss Plank at the time knew and intended that upon her changing the account as she did “it meant that either one could draw from the account at any time during the life of either.” The record discloses that all of this account was withdrawn during the lifetime of Miss Plank. Under the circumstances there is no occasion for determining whether the above-quoted assignment created a right of survivorship. Instead it is suffi cient to note that it was the intent and purpose of Miss Plank so to alter her account with this savings and loan association that either she or her nephew Raymond had the right to withdraw from the account. As a matter of fact the record discloses Raymond did make such withdrawals on several occasions during the lifetime of his aunt, finally withdrawing the balance of the account prior to her death. Under this record there is no equitable ground for -attempting to disturb or alter the nature of the transaction as intentionally and lawfully designed and executed by Miss Plank during her lifetime.
“The object to he arrived at by courts in construing deeds or other contracts is to ascertain clearly the intention of the parties.” Murray v. Kator, 221 Mich. 101.
In the case just cited one of the headnotes reads: “An intent on the part of the grantors to create an estate other than in common may be inferred;” and in Equitable & Central Trust Co. v. Zdziebko, 260 Mich. 366, 372, we said: “Strict formalities are not requisite in creating a joint bank account with right of survivorship.”
Statement of the reasons or the circumstances which led to joining others with J. Raymond Plailk as parties defendant is not requisite in view of the conclusion reached. The decree entered in the circuit court is affirmed, with costs to appellees.
Chandler, C. J., and Boyles, Starr, Wiest, Butzel, Bushnell, and Sharpe, JJ., concurred. | [
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Butzel, J.
A" tract of over 57 acres at the southeast corner of Wattles and Crooks roads in Royal Oak township, county of Oakland, Michigan, was divided into 9 parcels by its owner, George J. Sass. For better understanding of the facts, a rough draw ing is given below wbicb corresponds to plaintiffs’ Exhibit 2, as modified by stipulation filed by the parties and testimony.
Two cases involving the same easement, claimed by Gerald Baril and wife and Evelyn Setter, were consolidated, tried and brought here on one appeal. The trial court held that the northerly 25 feet of the 10 acres immediately below parcels Nos. 1, 2 and part of 3 were impressed with an easement in favor of the claimants. George J. Sass, the former owner of the entire tract, did not plat the property but sold large lots by metes and bounds. Parcel 1 is bounded on the north by Wattles road, known also as the 17-Mile road, and on the west by Crooks road. Parcel 1 contains somewhat less than 5 acres of land. Parcels 2, 3, 4, 5 and 6 each contain 5 acres. South of parcels 3 and 4 there was carved out a 3-acre tract. The other two tracts consist of 10 and 17 acres each, as shown by the drawing. Evelyn Setter, Sass’s grantee and the owner of parcel 3, deeded the southerly 1%-acre subparcel to Gerald Baril and wife. They built a home and a garage thereon. It will be noted that this 1%-acre, the 3-acre and the 17-acre tracts have no frontage on the main roads. The 1%-aere parcel is wholly, isolated, at least for vehicles of all kinds, if it does not have the use of the easement as to ingress and egress claimed by its owners. There is a deep and wide depression between the 1% and the 3% acres of parcel 3, which is filled a large part of the time with water. The only way the owners of the 1% acres of property would have for their vehicles would be over the 25-foot strip, or by means of a bridge which they would have to build at a cost both prohibitive and out of proportion to the valne of their entire property. The bridge would lead to the upper 3% acres owned by Mrs. Setter, mother of Mrs. Baril.
On May 3,1928, Sass and wife, and others, deeded the 10-acre parcel to Frank and Jennie Hopkins. The deed after giving a description of the property stated :
“The first parties hereby reserve the north 25 feet of the above-described property for roadway purposes.”
In June, 1937, Hopkins and wife sold on land contract to George "W. Akers and Louise C. Akers the same property with the same north 25 feet excepted for roadway purposes. Both in 1928 and 1938, Hopkins and wife gave mortgages on the property containing the same description and the same reservation. Counsel stipulated that at the time Sass reserved the 25-foot strip for roadway purposes, he was also the owner of the entire parcel 3 and the 3-acre tract, which we have designated parcel 7 on the drawing. As late as June 23, 1937, in order to correct the description in the former deed, Sass and wife gave Hopkins and wife a quitclaim deed of the same property. The deed, as recorded, contained the same reservation as to the north 25 feet for roadway purposes.
In August, 1937, Sass and wife deeded the entire parcel 3 to Evelyn Setter and on the same day she deeded the southerly 1% acres thereof to Gerald Baril and Lila M. Baril. In 1940, Hopkins and wife gave a new land contract to Akers but dated it back to June 22,1937, the date of the former contract, and left out the reservation of the 25 feet for right of way. At about the same time, Sass gave a quitclaim deed dated back to June 22, 1937, to Hopkins. It contained no reservation of the right of way. Subsequent to 1928 an additional right of way was established down the easterly side of parcel 4. This would give the owners of parcel 7 (the 3-acre tract) and the 17-acre tract means of ingress and egress. However, the reservation of an easement of way apparently for the benefit of all of grantor’s remaining property adjacent to such first right of way, and existing at the time of the sale of the remaining property, cannot subsequently be extinguished by the former grantor.
The titles to both parcels 3 and 7 were in Sass, when he reserved the right of way in his deed to Hopkins, hence with respect to those parcels such reservation was not void under the rule that a stranger to a deed may take nothing by way of reservation therein. The language of the reservation does not specify whether the easement was intended to be in gross or appurtenant, nor, if the latter, appurtenant to what lands. An easement will never be presumed to be a personal right where it can be construed as appurtenant to some estate, notwithstanding the silence of the deed. Jones v. Stevens, 276 Mass. 318 (177 N. E. 91,76 A. L. R. 591); Lindenmuth v. Safe Harbor Water Power Corp., 309 Pa. 58 (163 Atl. 159, 89 A. L. R. 1180). Where an owner conveys part of his land and reserves an easement over it, without specifying that such easement is to be appurtenant to land retained by him, the surrounding circumstances, including the adjacency of the way to the land retained, may be considered by the court in order to ascertain the intention that the easement was intended to be appurtenant thereto. Tusi v. Jacobsen, 134 Ore. 505 (293 Pac. 587, 71 A. L. R. 1364). The way in suit, viewed in the light of the broad language reserving it and the further fact that the grantor in the deed retained title to lands adjacent thereto, would naturally be construed as appurtenant to all such adjacent and retained lands. Both Hopkins and Sass, the former owners, testified that they intended to reserve the right of way for the benefit only of the 3-acre and 17-acre parcels, but when the latter did not require this easement as a way of necessity because of the other way over parcel 4, such 25-foot right of way was forgotten to all intents and purposes by the witnesses until the grantee of the south 1% acres of parcel 3 began using it.
John, the husband of Evelyn Setter, to whom Sass deeded parcel 3, stated that at the time the parcel was purchased from Sass, the latter stated that the right of way was up to the owners connecting with that road, that it was for the use of anyone connecting with it, that all the property touching the roadway was entitled to it. Evelyn Setter largely corroborated what her husband had stated with regard to the conversation with Sass. Setter further testified that they knew at the time that the southerly 1% acres without means of ingress and egress would otherwise be inaccessible because of the wide natural depression in soil which was impassable because filled with water most of the year and bridgeable only at a prohibitive cost, that one could not drive from the 17-Mile Road to the 1% acres in the very driest part of the year. Baril testified that he had graveled the roadway, that it had been used by others, that he'put the roadway in in the fall of 1938, and his attention was first called to the dispute about the roadway after he had built his home, that he went to see defendant Akers about it, who promised to look up his deed, and, not hearing any further from him, he (Baril) went to the township hall and the plats there showed the roadway, that he looked up the deed to the Akers’ property, that he dumped 150 yards of gravel on the road prior to the time that he received a letter telling him to desist. He also testified that he saw Sass prior to the time that he built his house and Sass told him that the road was there but had never been publicly dedicated, that Sass stated that he saw no reason why he should not go ahead and open up the road. He admitted that no one else used the road until after he graveled it and built a runway going to Crooks Road. Hopkins and wife did not ask that the reservation be limited when they took the deed from Sass, in which the latter reserved 25 feet- for roadway purposes. They accepted and recorded the deed with the unqualified reservation, and thus estopped themselves and their successors from denying the use of the road to abutting property owners who bought in the belief that they were entitled to. an easement which was necessary so as to give an appreciable value to the rear part of lot 3 retained by Sass at the time he gave the deed containing the reservation. We are not impressed by the fact that, when the dispute arose, Sass and the others executed new instruments, dating them back, in an effort to cut off the easement by omitting any reference to it in the new deed. Nor do we believe that Mrs. Setter and her grantees should be relegated to an action at law against Sass for misrepresentations.
The additional point is raised by counsel of Akers that the original grantee of parcel 3 now owns only the north 3% acres thereof, which subparcel is in no way adjacent to the way in suit, and, therefore, if a servitude be imposed, its benefit should be confined to the south 1% acres thereof. A right of way may be appurtenant where the servient tenement is not adjacent to the dominant, according to the rule established in the majority of jurisdictions. See annotation in 76 A. L. B. 597-603, especially the subdivision entitled, “Subdivision of dominant estate,” 76 A. L. B.~600. The easement was for the benefit of all land which adjoined the way when it was created, no more, no less. No questions are presented on this record as to the rights or duties as between the owners of the 3%-acre subparcel and those of the 1%-acre subparcel, and we do not pass upon any. We simply hold that both are entitled to the way as against the persons holding the 10-acre tract on the principle that undisclosed intentions furnish no defense to claims of innocent third parties misled by positive word, deed or act.
The testimony is in dispute but we believe that the instruments on record together with the testimony of defendant Setter and Gerald Baril prove that the right of way not only was created but continued to exist.
The decree of the circuit court declaring the easement appurtenant to all of parcel 3 is affirmed, with costs to appellees.
Chandler, C. J., and Boyles, North, Starr, Bushnell, and Sharpe, JJ., concurred. Wiest, J., did not sit. | [
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Starr, J.
Plaintiff’s husband, Wayne Heckler, was fatally injured in an automobile collision occurring about 3 o’clock in the afternoon on November 8, 1939. The collision occurred at the intersection of highway US-2, a 20-foot cement paved through high way, running in a northerly and southerly direction, and Trader’s Mine road (herein referred to as the “Mine road”), a graveled road, running easterly and westerly and being the northern city limits of Iron Mountain in Dickinson county. It was a clear day; the roads were dry; and both drivers were familiar with the intersection.
A “Stop — Thru Highway” sign was located on the north side of Mine road about 27 feet east of the intersection. A “speed limit 25 miles per hr.” sign, authorized by the city council of Iron Mountain, was located on the west side of US-2, near the south side of Mine road.
Plaintiff’s decedent, an automobile mechanic, driving alone in a Ford coach, was proceeding westerly on Mine road and approaching the intersection. Defendant Laing, accompanied by Dr. Libby, was driving his Chevrolet coupe northerly on US-2, approaching the intersection. The cars collided at the intersection resulting in injuries to plaintiff’s decedent, from which he died that evening. Defendant’s passenger was also fatally injured.
An engineer, who prepared the sketch of the intersection introduced in evidence, being called as a witness by plaintiff, testified that one driving westerly on Mine road, approaching the intersection, could see south (to his left) on US-2 “probably about 500 or 600 feet;” that one driving northerly on US-2 could see east (to his right) on the Mine road; and that “both motorists should be able to see each other.”
Plaintiff, as administratrix of her deceased husband’s estate, began suit against defendant for damages resulting from such accident. The case was tried before a jury.
Plaintiff presented testimony that defendant was driving northerly on the left (wrong) side of US-2 at an excessive speed of 60 to 65 miles an hour; that plaintiff’s decedent, driving westerly on Mine road, was proceeding across the intersection, and that the collision occurred on the left-hand (west) side of US-2. One witness for plaintiff testified that prior to the accident he had seen plaintiff’s decedent sitting in his car which was stopped east of the stop sign on Mine Road. However, two witnesses for defendant testified, in substance, that plaintiff’s decedent approached the intersection at a speed of 30 to 35 miles an hour and drove into the intersection without stopping. Other witnesses for plaintiff testified, in effect, that the two above-mentioned witnesses for defendant were not even present at the scene of the accident.
Defendant denied driving at an excessive rate of speed and on the wrong side of the road. He testified that he was driving on the right-hand side at a speed of 30 to 35 miles an hour, and that the collision occurred on the right side of the road.
Defendant’s negligence was clearly established by his own testimony:
“Q. Now what was the first thing that you observed, if anything, just immediately prior to the time the collision took place?
“A. The radiator of the other car crashing into the door, the right-hand door of my car. * * *
“Q. What, if anything, did you do just immediately prior -to the time the collision actually took place, if you did anything?
“A. I don’t believe I did anything, except I was driving along the road. * * *
“Q. You knew where the Trader’s Mine was?
“A, Yes, sir.
“Q. And you knew that intersection was there?
“A, Yes. * * *
“To the best of my recollection, I never saw this Heckler car until the radiator struck my car. * * *
“Q. Now, although you were driving along there on a clear day, you never saw this ear that was on the Trader’s Mine road until the collision occurred, did you?
“A. Not that I can recall.
“Q. What were you looking at?
“A. I was watching the road ahead of me.
“Q. You knew you were coming to the intersection?
“A. This intersection wasn’t marked.
“Q. You knew you were coming to the intersection. You told us a while ago you knew the intersection was there.
“A. I knew there was an intersection there, but I had never seen a car coming out of there. * * *
“Q. Anyway you were driving along there on this clear day with a view of 100 feet at least to the right and never saw that car, that is true, isn’t it?
“A. I had the right of way. * * *
“Q. Just because you had the right of way do you feel that you have a right to disregard all cars on cross roads?
“A. No, not necessarily so.
“Q. Why didn’t you look and see if there was a car coming on that cross road?
“A. There was no stop sign to say to stop to look for a car coming.
“Q. You know people sometimes come out of these roads. Do you feel you have a right to run over them just because there is a stop sign there?
“A. If this car had stopped at that crossing he would have seen me. * * *
“Q. The fact remains, although it was a clear day and you had a wonderful view there, you never saw this car until the minute of the impact, did you?
“A. No.
“Q. You didn’t apply your brakes, did you?
“A. Not that I recall.
“Q. You didn’t turn either to the right or left to avoid the collision, did you?
“A. Not that I recall. * * *
“Q., The question is did you make any effort to avoid the collision. Yes or no.
“A. No.”
At the conclusion of plaintiff’s proofs defendant’s motion for directed verdict, on the ground of contributory negligence as a matter of law, was denied. Such motion was renewed at the conclusion of all proofs, and was again denied. In his instructions to the jury, the court stated, in part:
“So you see, taking either theory of this case, Mr. Laing, the defendant here, was guilty of negligence, legal negligence. But that does not dispose of this case for you. You may go to your jury room taking that as an established fact, but then you pass on to the question of whether or not the plaintiff’s husband, the deceased, was guilty of any contributory negligence.”
The jury returned verdict of $9',298.85 for plaintiff, and judgment was entered thereon. Defendant moved for new trial, on the grounds that the verdict was contrary to law, to the great weight of the evidence, and tt> the physical' facts; that the court erred in denying defendant’s motion for directed ver’dict; and that the court erred in instructions given and in refusing to give instructions requested. Such motion was denied, and defendant appeals.
No question as to defendant’s negligence is raised in the statement of questions involved. We will, therefore, consider only the question of whether or not plaintiff was guilty of contributory negligence as a matter of law.
As plaintiff’s decedent approached through highway US-2, at which a ‘ ‘ stop ’ ’ sign was located, it was his duty to stop. 1 Comp. Laws 1929, § 4715 (Stat. Ann. § 9.1583). We said in Gallagher v. Walter, 299 Mich. 69, 75:
“The above statute requiring plaintiff’s driver to stop at Orchard Lake road, a through highway, is mandatory. See Hilliker v. Nelson, 269 Mich. 359; Pulford v. Mouw, 279 Mich. 376; Potter v. Felician Sisters Home for Orphans, 281 Mich. 101; Leader v. Straver, 278 Mich. 234; Shoniker v. English, 254 Mich. 76. We are not disposed to interfere with the intended purpose of such statute and the usefulness of stop signs.”
It was not only the duty of plaintiff’s decedent to stop at US-2, but it was also his duty, after stopping, to make proper observation for approaching traffic. If he did not stop or, having stopped, failed to make proper observation before entering the intersection, he was guilty of contributory negligence as a matter of law. Gallagher v. Walter, supra; Zuidema v. Bekkering, 256 Mich. 327; Buwalda v. County of Ottawa, 270 Mich. 477.
Plaintiff’s decedent, in making the required observation on US-2, is presumed to have seen what a person in the exercise of ordinary care and caution would see; that is, what was plainly visible.
“In mailing such observation plaintiff’s driver would be presumed to see the things which a person in the exercise of ordinary care and caution would see under like circumstances.” Gallagher v. Walter, supra, p. 76.
In Slingerland v. Snell, 283 Mich. 524, 527, Mr. Justice Sharpe stated:
“In the case at bar we do not know what plaintiff’s decedent saw, but he could have seen the defendant approaching from his left and is chargeable with what he could have seen.”
See, also, Zuidema v. Bekkering, supra; Knight v. Merignac, 281 Mich. 684.
The view of plaintiff’s decedent to his left (south) being unobstructed, he either saw, or is legally presumed to have seen, defendant’s car approaching from the south.
There is no testimony as to what observations, if any, plaintiff’s decedent made before driving into the intersection. Plaintiff’s counsel, in effect, contends that in the absence of such testimony it is presumed that plaintiff’s decedent made proper observations. Any' such presumption is overcome by the evidence that he had a clear and unobstructed view, to his left, of US-2. He either saw or is presumed to have seen defendant’s car approaching and by the exercise of due care and caution could have avoided the accident. In the .case of Patt v. Dilley, 273 Mich. 601, 606, Mr. Justice Wiest said:
“Presumptions disappear when the facts appear. The facts appear when the evidence is introduced from which the facts may be found, Presumptions cannot be weighed against evidence for they fade out in the light of evidence, no matter how contradictory the evidence.”
“We are of the opinion that it is clear that it is the^rule in this State that the presumption that a plaintiff is free from contributory negligence can be said to apply only in cases where there is an absence of any direct evidence to the • contrary. The question then is, Was there evidence before the trial judge which could be said to overcome the presump- ' tion relied upon?” Baker v. Delano, 191 Mich. 204, 209.
See, also, Gillett v. Michigan United Traction Co., 205 Mich. 410; Rousseau v. Brotherhood of American Yeomen, 186 Mich. 101; Union Trust Co. v. American Commercial Car Co., 219 Mich. 557; Maki v. William Bonifas Lumber Co., 278 Mich. 610; Christiansen v. Hilber, 282 Mich. 403.
Our decision in Zuidema v. Bekkering, supra, is directly applicable to the present case on the question of contributory negligence. In that case we said, pp. 330, 331:
“Plaintiff’s husband, the driver of the automobile on the Fisher road, when he reached a point thereon near the pavement on the Byron Center road, had an unobstructed view to the left down the Byron Center road, for a distance of 500 feet and a practically clear view for approximately 1,100 feet. If plaintiff’s husband looked down the highway to the left and saw defendant’s automobile approaching and drove on to the pavement in front of defendant’s automobile with knowledge of its approach, he was guilty of contributory negligence. If plaintiff’s husband, though he may have stopped his automobile near the intersection and before attempting to cross the pavement, did not look to the left, but drove onto the pavement without looking and by reason thereof was struck by the defendant’s automobile, he was guilty of contributory negligence. It will not do to say that plaintiff’s husband looked down the Byron Center road to the left before attempting to cross the pavement and did not see the automobile of defendant approaching. He must be held to have seen what he should have seen, which there was nothing to prevent him from seeing, and if, as contended by plaintiff, he stopped his automobile, looked to the left, and did not see what was plainly to be seen, th§ approach of defendant’s automobile, he was guilty of contributory negligence which would bar plaintiff’s recovery.”
In Kok v. Lattin, 261 Mich. 362, 363, 364, we said:
“For half a mile back both drivers had a clear and unobstructed view of the intersection. Had the defendant looked he could have seen the plaintiff before and when he entered the intersection. Had the plaintiff looked he would have seen the defendant in time to have avoided the collision. He testified that he did look and saw no car approaching. His testimony in this respect is contrary to the physical facts. As his view was unobstructed and the defendant’s car was there in plain sight, it must be held that he did not look. If he had looked, he would have seen what was there to be seen. The two cars reached the intersection at about the same time. If either had looked, he could have avoided the accident. Failure to look was negligence. The undisputed material facts left no question for the jury. The trial court correctly ruled that, as a matter of law, there could be no recovery.”
In the case of Hubbard v. Canavara, 295 Mich. 499, plaintiff’s driver approached through highway US-2 to a point where he had a view of such highway for about 200 feet. Defendant’s car, with headlights burning, was approaching on the through highway from the west. Plaintiff’s driver proceeded into the intersection where the collision ocr curred. In affirming judgment for defendant non obstante veredicto, we said, p. 502:
“While he [plaintiff’s driver] testified that as he approached the east and west pavement [US-2] he made observations both to the right and to his left, still the physical facts disclosed by this record are such that no other conclusion can be reached than that defendant’s car on its right side of the high way with the lights burning was approaching rapidly within Mr. Hubbard’s [plaintiff’s driver’s] view before he entered upon the traveled portion of the east and west highway and while he was at a point where he could have stopped his car in a place of safety. This he did not do, and the accident resulted. * * * Regardless of the question as to whether or not the driver of defendants’ car was guilty of negligence, it must be held as a matter of law under the facts in this case that plaintiff’s driver was guilty of contributory negligence, and it follows that she cannot recover.”
Under the testimony presented in the instant case, the inevitable and only reasonable conclusions that can be reached are: (1) That plaintiff’s decedent did not make proper observation before entering the intersection; or (2) that he made observation, but failed to see defendant’s car, which was plainly visible, approaching the intersection; or (3) that he made observation and saw defendant’s car approaching, and then negligently took his chances and drove into the intersection in the face of known danger.
Under any of such conclusions, viewing the testimony in the light most favorable to plaintiff, her decedent was guilty of contributory negligence as a matter of law. Defendant’s motion for directed verdict should have been granted.
In view of our determination, other questions presented do not require consideration.
The judgment is set aside without a new trial, with costs to defendant.
Chandler, C. J., and Boyles, North, Wiest, Butzel, Bushnell, and Sharpe, JJ., concurred. | [
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Bushnell, J.
Plaintiff Jay D. Wilkinson brought-this action against defendants Powe and Stinson, individually and doing business as Shamrock Creamery, charging them with wrongfully procuring a breach of plaintiff’s contract with certain farmers to haul their milk.
In 1932 plaintiff and his father, David Wilkinson, began to haul milk for farmers to the Oakland Creamery and built up their first milk route. Later, they ceased to deliver milk to the Oakland Creamery and began to deliver to the Shamrock Creamery. The Wilkinsons developed a second milk route in 1934 or 1935. A written agreement covering the year 1937 was entered into between the Wilkinsons and the farmers on their milk routes in December of 1936. The Wilkinsons agreed to haul milk to Pontiac creameries and the farmers agreed to pay them 25 cents per hundred. Prior to 1937, the arrangement between the Wilkinsons and the farmers was not evidenced by a written contract. The principal and heavier route was 97 miles and the other 94 miles. In April of 1937, David H. Wilkinson assigned all of his interest in the milk routes to plaintiff Jay D. Wilkinson.
Shortly after the execution of the written agreement, defendant Powe told the Wilkinsons that he wanted to take over the larger route and offered in exchange for the route the trade-in value of plaintiff’s old truck, and told plaintiff he would give him a job in the creamery. Plaintiff then informed Powe of the existence of the written contract and refused to give up the route. About three months later Powe informed plaintiff that he would be required to replace the open stake racks on his trucks with insulated bodies because of a municipal ordinance. After plaintiff made this change in his trucks, he was unable to get his trucks into the creamery and the milk had to be handled by hand. This led to friction between the parties.
On May 29, 1937, defendant Powe sent a letter to the farmers doing business with plaintiff, worded as follows:
“For reasons which are vital to our business, we the Shamrock Creamery, have decided that on and after June 1st, we will purchase no milk except that which is picked up by our own trucks at the farm.
“Nothing on your part has occasioned or made necessary this change, and we are hopeful that you will continue to sell us your milk. Pursuant to the change made, our trucks will call at your place Tuesday afternoon, June 1st, to pick up your milk, if you desire to continue business with us.
“Trusting that our business relationship may continue and be of mutual benefit, I am,
Tours very truly
(Signed) T. M. Powe,
Shamrock Creamery.”
The particular season of the year in which the letter was written was described by a witness as being the “lush” season for milk when the available supply is about double that of other months of the year. This letter resulted in a meeting of some of the farmers to consider the situation. As a result of the request made by some of these farmers at the meeting, defendants sent out a notice dated June 1, 1937, reading:
“We have agreed to let Jay D. Wilkinson’s trucks continue to haul the milk they have been hauling to our milk plant for the first 10 days of June, 1937. Disregard the notices you received today May 31st until June 11th.”
On June 10th, Powe wrote a letter to Wilkinson in which he said:
“We have caused to be served on all farmers affected by the same a duplicate of the attached letter. Due to a verbal agreement made in consideration of the wish of some of those affected the date stated was extended to June 11, 1937.
“Since we understand that you have a contract of some nature with many of the farmers in question we are inclosing a copy of said letter, so that you may govern yourself accordingly.”
Wilkinson was unable to find another suitable market for milk after June 10th and was soon forced to abandon his routes. Defendants have since hauled the milk of practically all the farmers formerly under contract with plaintiff.
Plaintiff alleged in his declaration that defendants’ object was to prevent him from protecting the farmers on his routes from false, fraudulent, and dishonest practices in the testing, weighing and price paid for milk. This was denied by defendants. They claimed their reason for deciding to haul the milk was that plaintiff failed to deliver the milk on time or in a proper condition, and that the action was taken to protect themselves and their customers by insuring a steady supply of good cream and wholesome milk. The testimony is in conflict on this point; but since the jury found for plaintiff, it must be assumed that they resolved this question against the defendants.
Plaintiff claimed damages in the sum of $5,000, and testified that each of his routes had a value of $2,000. The jury returned a verdict in the sum of $4,000. On a former trial by jury, a verdict of $5,000 was rendered and judgment entered thereon. Subsequently a new trial was granted. On this, the second trial, decision on a motion for directed verdict having been reserved, the trial judge entered a judgment for no cause of action.
In a written opinion the court observed that Morgan v. Andrews, 107 Mich. 33, is authority for the proposition that an action for damages lies against one who is not a party to a contract but who wrongfully induces a breach or termination thereof, and stated that the acts of defendants, “in order to cause liability, must have been over and above and other than mere refusal to accept milk hauled by the plaintiffs.” The court also observed that in Morgan v. Andrews, “the only Michigan case on the subject, the act there rendered (which created) liability was the malicious falsehood and deceit of the defendant in inducing the purchaser to reject the machine which he would otherwise have accepted. ’ ’
The court stated that “the case at bar does not permit of any speculation on the element of falsehood or deceit which would amount to fraud, leaving then only for consideration, whether or not the action of the defendant could be construed factually as the application wrongfully of pressure and force,” citing Angle v. Railway Co., 151 U. S. 1 (14 Sup. Ct. 240, 38 L. Ed. 55), and Bitterman v. Railroad Co., 207 U. S. 205 (28 Sup. Ct. 91, 52 L. Ed. 171, 12 Ann. Cas. 693).
The crux of the court’s opinion is expressed as follows:
“A factual situation justifying the submission of . the issue to a jury for the assessment of the damages is not present. The jury verdict must be predicated upon a circumstance which does not take into consideration the defendants’ right to discontinue its source of supply at any time. To find for the plaintiff is a sympathetic attempt to give legal security to one, who, in a precarious position, acted unwisely. * * * Without their acceptance (defendants) of the product the routes had no value. Lawful action, not unlawful action, then eliminated any value the routes may have had.”
If the trial court is. to be sustained, the judgment must stand on one of two grounds; first, that, in procuring the breach of contract, defendants were exercising what is often designated as a “superior” or “absolute” right, i.e., to refuse to accept further delivery of milk from plaintiff and, therefore, no justification was necessary; or second, that the injury, if any, was the result of defendants ’, refusal to accept deliveries of milk from plaintiff, and the breach of contract by the farmers was not the prox- ■ imate cause of plaintiff’s injury.
Morgan v. Andrews, supra, though not citing the leading English case of Lumley v. Gye, 2 El. & Bl. (Q. B. 1852), 216 (118 Eng. Rep. 749, 22 L. J. Q. B. [N. S.] 463), in the following language approves the general proposition laid down in the Lumley Case that :
“Merely to persuade a person to break his contract may not be wrongful in law or fact; still, if the persuasion be used for the indirect purpose of injuring the plaintiff, or benefiting the defendant at the expense of the plaintiff, it is a malicious act, which, in law and in fact, is a wrongful act, and therefore an .actionable act, if injury issues from it.”
A prima facié case is established when plaintiff proves the intentional procurement of a breach of contract, and, upon such proof, it becomes incumbent upon defendant to show justification. See 84 A. L. R. p. 79.
The court said in E. L. Husting Co. v. Coca Cola Co., 205 Wis. 356 (237 N. W. 85, 84 A. L. R. 22, 29), in quoting from Campbell v. Gates, 236 N. Y. 457 (141 N. E. 914):
“The great weight of authority in this country and in England is to the effect that, if A has a legal contract with. B, either for the rendition of service or any other purpose, and C, having knowledge of the existence thereof, intentionally and knowingly, and without reasonable justification or excuse, induces B to break the contract, by reason of which A sustains damage, an action will lie by A against C to recover the same. * * * The action of C is malicious, in that, with the knowledge of A’s rights, he intentionally and knowingly and for unworthy or selfish- purposes, destroys them by inducing B to break his contract. It is a wrongful act, done intentionally, without just cause, or excuse, and from this a malicious motive is to be inferred. This does not necessarily mean actual malice or ill will, but the intentional doing of a wrongful act without legal or social justificatiQn.”
No categorical answer can be made to the question of what will constitute justification, and it is usually held that this question is one for the jury. See cases collected in 84 A. L. R. p. 81. The language in some of the cases supports defendants’ contention that they acted under a “superior” or “absolute” right in refusing to accept further deliveries of -milk by plaintiff, and that, under those circumstances, their action requires no justification. See Eastern States Retail Lumber Dealers Assn. v. United States, 234 U. S. 600 (34 Sup. Ct. 951, 58 L. Ed. 1490, L. R. A. 1915 A, 788), and H. D. Watts Co. v. American Bond & Mortgage Co., 267 Mass. 541 (166 N. E. 713, 84 A. L. R. 12). See, especially, the instructions of the trial judge in the Watts Case, shown on pages 21 and 22 of 84 A. L. R.
If the defendants in the instant case had merely refused to accept further delivery of milk by plaintiff, they would have been clearly within their legal rights, although this would have resulted in a breach of contract between plaintiff and the farmers. But defendants did more. Their letters of. May 29th and June 1st show active solicitation of a breach of the contract and their refusal to accept delivery of milk was merely another step in bringing about the breach.
Almost analogous facts, so far as the principle is concerned, are found in Knickerbocker Ice Co. v. Gardiner Dairy Co., 107 Md. 556 (69 Atl. 405, 16 L. R. A. [N. S.] 746). In the Gardiner Case, plaintiff Gardiner Company was engaged in the dairy business and required a large quantity of ice during the spring and summer months. In order to meet its requirements, it entered into a contract with the Sumwalt Company to deliver not exceeding 20 tons of ice a day until the completion of plaintiff’s plant, then in the course of construction, at a price of $5 per ton, delivered. Sumwalt at the time was purchasing ice in large quantities from the defendant, Knickerbocker Ice Company, and when defendant learned of the contract between Gardiner and Sumwalt, it notified Sumwalt that it would refuse to deliver any ice whatever to it unless it refrained from delivering ice to Gardiner. Being compelled by the exigencies of its business to secure ice from Knickerbocker, and alarmed by the threat, Sumwalt breached its contract with Gardiner and advised it that this was done because of the action of Knickerbocker. Gardiher was thereby compelled to purchase ice directly from Knickerbocker at a price considerably greater and on less advantageous terms. The court discussed Lumley v. Gye, supra, and other authorities, and held that (p. 567):
“If the Knickerbocker company had simply refused to furnish the Sumwalt company with ice, the Gardiner company would not, for that reason alone, have a remedy against the Knickerbocker company. Such action would not necessarily be unlawful or wrongful, but, if the Knickerbocker company refused to furnish the Sumwalt coiúpany if it fur nished the Gardiner company, although it knew it was under contract to do so, in order to get the business of the Gardiner company for itself on its own terms, then it was unlawful thus to interfere with the contract between the Sumwalt company and the Gardiner company. So, without further pursuing that branch of the case, we are of the opinion that the demurrer was properly overruled, as the declaration stated an actionable wrong, even if there had been no express allegation of malice.”
The editor states in the annotations of 16 L. R. A. (N. S.) at page 747, that:
“Although the doctrine is denied by some courts, the weight of authority at the present time sustains Knickerbocker Ice Co. v. Gardiner Dairy Co.”
Substituting defendant for Knickerbocker, the farmers for Sumwalt, and plaintiff for Gardiner, there is a parallel in principle. Instead of refusing to sell, as in the Gardiner case, defendants in the instant case refused to purchase from the farmers unless they broke their contract with plaintiff and thereby brought about the breach.
Defendants’ refusal to accept further deliveries of milk by plaintiff was wrongful in the light of the evidence in the instant case because it was done to accomplish an unlawful purpose, i.e., to bring about a breach of contract. It therefore follows that the problem of proximate cause disappears from consideration in the case. Defendants cannot be heard to say that they should not be held liable for the injury caused plaintiff by their unlawful acts merely because they could have caused the same injury by a lawful act.
The right to perform a contract and to reap the profits resulting therefrom, and the right to compel performance by the other party, is generally regarded as a property right. The direct consequence of defendants’ acts was to destroy plaintiff’s routes, and plaintiff is entitled to recover their value.
That a few of the farmers on the routes had not signed the contracts is beside the point. Plaintiff certainly had an understanding with them, and there is no testimony to show that they would not have continued to employ plaintiff to haul their milk if defendants had not interfered.
The damages allowed by the jury are supported by the testimony. The order for entry of judgment notwithstanding the verdict is vacated and the cause remanded for entry of judgment upon the verdict. Costs to appellant.
Chandler, C. J., and Boyles, North, Starr, Wiest, Butzel, and Sharpe, JJ., concurred. | [
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Brooke, J.
(after stating the facts). We have held, Tarpper v. Weston-Mott Co,, 200 Mich. 275, that to entitle a claimant to compensation for an injury arising “out of” his employment it must be shown that:
“The causative danger must be peculiar to the work, and not common to the neighborhood. It must be incidental to the character of the business, and not independent of the relation of master and servant. It need not have been foreseen or expected, but after the event it must appear to have had its origin in a risk connected with the employment, and to have flowed from that source as a rational consequence.”
Applying this rule to the facts as testified to by claimant, it is the conclusion of my Brethren (with which I with much difficulty agree) that it can be said that the claimant’s injury arose “out of” his employment.
Disposing of the question of fact, the board said:
“The applicant, it seems, was sitting on the curb and thought that the wagon could drive through between him and the machine without striking him. Possibly he ought to have gotten up and gotten out of the way. However, he was there on duty, and was only sitting still at the time owing to the exigencies of the work. He had a right to sit still until some other operative moved the machine so he could work. He had not gone away from the point of his labor. The board does not think he was asleep, lying with his feet in the street.” '
Counsel for appellant asserts that this finding is not a finding of fact concluding the question, but even if true does not warrant a recovery by claimant under the circumstances. The finding, if warranted, was certainly sufficient to support the award, and, while three disinterested witnesses contradict the claimant, and his evidence was unsupported by any other testimony in the record, we cannot disturb the award because the great weight of the evidence is against the finding of fact upon which it is based. Argument upon this phase of a case 'must always be addressed to the board themselves, who under the statute are made final arbiters thereof. Some recent cases involving the question here involved follow: Purdy v. City of Sault Ste. Marie, 188 Mich. 573; Papinaw v. Railway Co., 189 Mich. 441; Kunze v. Detroit Shade Tree Co., 192 Mich. 435; Haller v. City of Lansing, 195 Mich. 753; and Porritt v. Railway, 199 Mich. 200.
The award is affirmed.
Ostrander, C. J., and Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred. Bird, J., did not sit. | [
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Brooke, J.
(after stating the facts). As is usual in cases of this character, there is sharp conflict in the testimony. Several of the witnesses sworn for plaintiffs gave testimony tending to show that at the time the deeds were executed Friend D. Soules was old, feeble, and' without memory or power to carry on a connected conversation; that he sometimes failed to recognize his acquaintances and on one occasion failed to recognize his own son.' On the other hand defendant’s witnesses, including the scrivener, testified that, aside from the natural infirmities attendant upon extreme old age, the deceased was competent to understand the nature of the transaction. It is, we think, clear from the record that after the marriage and after the execution of the deeds in question, Friend D. Soules transacted more or less business with ap-. parent intelligence. While it is urged on behalf of plaintiffs that defendant entered into the marriage relation with the deceased from purely mercenary motives, and without any affection or friendship for her husband, we can gather no such impression from a careful perusal of the record. The parties to the contract were both very old. The deceased was a civil war pensioner drawing $30 per month from the government. The house and lot in question, worth less than $2,000, constituted his. entire estate. The disposition of the property effected by the deeds was natural and such an one as is usually commendable.
The plaintiffs’ claim is that this case falls within the following line of decisions: Witbeck v. Witbeck, 25 Mich. 439; Smith v. Cuddy, 96 Mich. 562; Whiteley v. Whiteley, 120 Mich. 30, and Noban v. Shoup, 171 Mich. 191, while the defendant strenuously insists that it falls within the reasoning of Fraser v. Jennison, 42 Mich. 206; Hoban v. Piquette, 52 Mich. 361, and Leffingwell v. Bettinghouse, 151 Mich. 513.
We have carefully perused the testimony of every witness sworn upon the trial of this case and find ourselves unable to agree with the conclusion of the learned circuit judge that the plaintiffs showed “conclusively” or even by a fair preponderance of the evidence that at the time of the execution of said conveyances Friend D. Soules lacked mental capacity to comprehend their nature and significance.
The decree of the court below is reversed and a decree will be entered in this court dismissing said bill of complaint, with costs of both courts to defendant.
Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred. | [
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] |
Stone, J.
This case is here for review of an order of the circuit court of Wayne county reversing an order of the probate court directing the sale of real estate to pay debts of the estate of William H. Van Syckle, deceased.
The history of the estate is as follows: William H. Van Syckle died intestate April 15, 1893, leaving as heirs a widow and two minor children, one of whom subsequently died. Whatever property interests deceased left, other than the land in question here— known as the Henry street property — were all exhausted in mortgage foreclosures, widow’s allowances and some small incidental expenses óf administration. Creditors have so far received nothing. As to the Henry street property, the situation was as follows: Under the will of his father, the deceased had an interest in remainder subject to a mortgage and the life estate of his stepmother. This remainder became an asset of the estate, subject further to the dower of the widow of deceased.
Letters of administration were granted to Thomas T. Leete, Jr., on May 23, 1893, the usual order on the same date being entered that the administrator be allowed one year thereafter, within which to dispose of the estate and pay the debts. Report of commissioners on claims was filed December 19, 1893, claims being subsequently filed and allowed by the court January 11th and May 2, 1894. A license to sell real estate was granted February 6, 1894, and on May 19, 1894, report was filed and duly confirmed showing the sale of other property, the Henry street property not being then advertised or sold.
The administrator filed his first account August 20, 1895, which showed, among other things, that the interest of the estate in the Henry street property still remained. On May 31, 1902, the administrator filed a-further report covering the whole period, in which it was stated:
“The real estate described in the inventory has been disposed of in accordance with the order of this court, or by the foreclosure of mortgages and forfeiture of land contracts, except the following: (Here follows the Henry street property.) The interest of deceased in said real estate has not been sold, for the reason that, in the opinion of the administrator, sale thereof could not be made without great sacrifice to the estate of deceased by reason of the outstanding life estate held by Libbie Van Syekle therein.”
This report was duly advertised, examined and allowed by the probate court, June 24, 1902. On September 23, 1908, the administrator, in response to an order entered September 9, 1908, filed his third account which contained a similar statement.
In the year 1913, Paul C. Renaud and Charles W. Burton purchased the interests of the widow and surviving son of deceased, in this property. On February 9, 1915, the administrator filed a petition in the probate court for license to sell this real estate for the purpose of paying the debts. After due proof of publication, upon hearing March 16, 1915, the probate court granted a license to sell. Plaintiffs herein having appeared and filed their objections in the probate court, appealed from this order. In their notice of appeal they, as owners of the fee of said lands, .claimed that there were no legal debts and charges, outstanding against said estate; that all alleged claims of record were outlawed by virtue of the statute of limitations ; that all alleged claimants had no valid standing in court by reason of their laches in not pressing their claims within a reasonable and lawful period of time; and that good faith purchasers have become possessed of the fee or remaindermen, estate in said lands, and that such a sale would be an unjust and unlawful interference with their legal and equitable rights.
Upon the trial in the circuit court it appeared in evidence that there were duly proven unpaid debts amounting to over $3,900, and interest thereon; that the real estate market in Detroit in the year 1893, and for several years thereafter, was in a very unfavorable condition, and on that account, and because of the intervening life estate, combined with outstanding mortgage and dower interests, the administrator believed that sale could not be had of the property without great sacrifice of the interests of both the heirs and the creditors, and in fact that the heirs would have received nothing if such sale had been made; that this view was discussed with the probate judge personally many times, and was incorporated in the administrator’s report and met the approval of the probate court; that this condition of affairs continued with the knowledge and consent not only of the probate court and of the administrator, but of the creditors and the heirs, the latter having moved to North Dakota, being in frequent personal touch with the administrator. It appeared that plaintiff Renaud carried on all of the negotiations for the purchase of the heirs’ interests by letter. The correspondence was put in evidence, from which it appeared that said plaintiff knew of the debts and mortgage and the condition of the estate.
It further appeared that the heirs in making their sale understood and expected that the debts of the estate were to be paid; and that plaintiff Renaud had obtained assignments of some of the claims at ten cents on the dollar and had offered five cents for others.
The trial court set aside the order of the probate court, and denied sale of the real estate. The estate has brought error, and the principal question raised by the assignments of error is whether, after the claims of the creditors have been regularly adjudicated and allowed, and while the estate remains open, in the charge and control of the probate court, and because proceedings for sale to satisfy the debts were deferred for the mutual protection of the creditors and heirs, and with the knowledge and consent of the administrator, the probate court, the creditors and the heirs, the creditors lose the right, and the court the jurisdiction, to enforce their claims as against plaintiffs who stand in the shoes of the heirs by purchase.
It is asserted by appellant that appellees rely upon sections 13883, 13884, and 13886, 3 Comp. Laws 1915, as a “statute of limitations,” and that it is their contention, which was apparently adopted by the trial court, that the above are mandatory provisions, and that the expiration of this four years and six months period arbitrarily cuts off all right on the part of creditors to have their claims satisfied, and all jurisdiction in the probate court to order a sale for such purpose. It is urged by appellant that this is not the law, and that there is no statute of limitations covering such a case as is here presented. It is true that section 13891, 3 Comp. Laws 1915, contemplates a decree of the probate court, for payment of debts and distribution of assets, to be entered on or before the expiration of the time limited for the payment of debts.
Section 18895 also contemplates that the probate court enter an order causing notice to be given to creditors of the time appointed for the payment of debts under such decree, and the next section provides as follows:
“If, after notice shall have been given as provided in the preceding section, any creditor shall neglect to demand from the executor or administrator his debt, or the dividend thereon, within two years from the time so limited for the payment of the debts, or if the notice shall be given after such time within two years from the last publication, the claim of such creditor shall be forever barred.”
It is urged by appellant that in the absence of a decree requiring the payment of the debts, and a notice to creditors in regard thereto, no statute of limitations applies, so long as the estate remains open, and that there was no such decree or notice here, the probate court advisedly deferring' such action with the consent of all concerned, and reference is made to the case of Peckham v. Hoag, 92 Mich. 423, which it is claimed rules this- case. In that case administration was granted in 1874. Plaintiff’s claim was presented, proven and allowed in 1880, and an order made requiring the administratrix to pay the debts within 90 days. Attempted sale of real estate to pay debts was made the same year, but was not confirmed because no oath or bond was filed. No further steps had been taken by the administratrix for the payment of debts. Plaintiff filed a petition for the removal of the administratrix. It was contended on the part of the respondent, among other things, that, 1
“Unless there is some method whereby the lands can now be sold by the administratrix, under the order of the probate court, the petitioner and other creditors cannot be benefited by continuing the administration; and that, Mr. Hoag having died May 8, 1874, the time has now gone by when a sale of the real property could be made by the administratrix under such order.”
This court said in July, 1892 :
“It appears conclusively, however, that the estate had not been closed at the time the application was made in this present proceeding. The jurisdiction to administer the estate and' to sell the real estate for the payment of the debts has not, therefore, been lost by lapse of time. * * * The casé will be certified to the probate court of Berrien county, directing that court to proceed upon the petition for the removal of the administratrix, to the end that the proceedings may be taken for the sale of sufficient of the real estate of the deceased for the payment of the debts.”
It will be noted that this action was directed upwards of 18 years after the death of Mr. Hoag. It is urged by appellant that if there were no other decisions to the same effect in this State, the rule here announced should be construed to constitute a rule of property; that creditors should not be deprived of their rights because, after having come into court and duly proved their claims, they have in good faith left the matter in the hands of the administrator and the probate court, the delay harming no one, and having been with the knowledge and consent, and inuring to the benefit of the heirs in whose shoes the plaintiffs stand.
The recent case of Ogooshevitz v. Arnold, 197 Mich. 203, is referred to as asserting the same doctrine. In that case it was said:
“One who buys land from heirs or devisees before the estate is closed takes it subject to the debts and expenses of administration. * * * There is a way provided in the statute for foreclosing claims against estates of decedents, viz.: appointment of commission ers, or a hearing of claims by the probate judge, and closing the estate; prior to 1915, this was the only method by which they might be barred.”
The trial court and the plaintiffs relied mainly upon Hoffman v. Beard, 32 Mich. 218. It is the claim of appellant that that case is readily distinguished-on its facts from the instant case, in that there the estate had been closed several years before the sale was made; and that while there is language used in that opinion which would seem to justify the holding of the trial court in the instant case, yet the rule there stated was discarded and overruled in Larzelere v. Starkweather, 38 Mich. 96. In this last named case the opinion was written, by the same Justice (Mars-ton) about three years later, and the claim being made there, as here, that under the rule of Hoffman v. Beard, the probate court had lost jurisdiction, the court said:
“In delivering the opinion in Hoffman v. Beard this court had no intention of holding that under no circumstances could the probate court order a sale of the real estate of a deceased person for the payment of his. debts, or that such a sale for such purpose could not be made after four years and six months from the granting of letters of administration. No such question was involved or decided in that case. Nor were the facts in that case such as would justify the court in coming to, and announcing such a conclusion. Some expression may be found in the reasoning in the opinion delivered in that case, which taken alone might give color to such an idea. The reasoning in an opinion is not that of the court, but of the judge who prepares and delivers it. It may, or may not, be considered sound and unanswerable, and as such is the subject of criticism. The conclusion arrived at and announced upon the several questions discussed and essential to a proper disposition of the case,- is that of the court, and in concurring in such conclusions it is not generally supposed or understood that everything contained or said in the opinion is thereby unqualifiedly and unquestionably adopted as the opinion of the court. * * * In, other words, the opinion and decision of a court must be read and examined as a whole in the light of the facts upon which it was based. They are the foundation of the entire structure which cannot with safety be used without reference to them. That the general rule laid down and the conclusion reached in Hoffman v. Beard was correct, as the facts stood in that case, we have as yet seen no reason to doubt, but that exceptions to such general rule exist, where, after the expiration of the time there stated, the probate court has jurisdiction to order a sale of the real estate of the deceased, for the payment of his debts, we have no doubt. Cases may frequently arise under our statutes, owing to delays arising from causes over which the administrator and probate court have no control, where the estate cannot be closed and settled within the usual and ordinary period. In all such cases the probate court does not lose its jurisdiction, when properly invoked, to order a sale of the real estate, and a sale made in accordance therewith will be valid and binding. Such has been the construction, placed upon similar statutory provisions by the courts of other states,” citing the statutes, and decisions.
The following cases are also cited by appellant: In re Estate of Beniteau, 88 Mich. 152, 154; Church v. Holcomb, 45 Mich. 29, 37; Norman v. Olney, 64 Mich. 553; In re Moores’ Appeal, 84 Mich. 474; In re Palms’ Appeal, 44 Mich. 637; Averill v. Jackson City Bank, 114 Mich. 20, 26; Long v. Landman, 118 Mich. 174; Card v. Fowler, 120 Mich. 646, 653; Brooks v. Hargrave, 179 Mich. 136, 144; Bresler v. Wayne Probate Judge, 152 Mich. 167; In re Reid’s Estate, 170 Mich. 476, 483, 484.
The trial court seems to have thought that the question involved was controlled by the following decisions of this court: Hoffman v. Beard, 32 Mich. 218; Brown v. Forsche, 43 Mich. 492; Winegar v. Newland, 44 Mich. 367, 370; Pratt v. Houghtaling, 45 Mich. 457; In re Young’s Estate, 144 Mich. 663.
We have already called attention to the cases which discarded the rule stated in the Hoffman Case, and we are of the opinion that the other cases relied upon by the trial court and the appellees do not establish or support the rule contended for.
The facts in the Young Case readily distinguish it from the instant case. In that case a decree for the payment of debts in accordance with the statute was entered about ten years prior to the application for license to sell real estate, claimant, herself the administratrix, who had paid most of the debts out of her own funds, having notice of it. It is also apparent that the estate had first been treated as closed, for on filing her first account, the administratrix showed that she had paid out more than she had received, and the order allowing the account “recited that she was discharged as administratrix.” She had a life estate of all the property under the will. It does not appear whether or not the attention of the court in that case was called to the ruling in Peckham v. Hoag, supra, and other similar cases. We find no language in the opinion indicating that the Peckham Case was overruled or intended to be, or the rule there stated modified; and while some of the language of the opinion would seem to be out of harmony with that case, yet when applied to the facts involved such want of harmony is more apparent than real.
The appellees are in no better position than would be the heirs from whom they purchased, with full knowledge of the claims of creditors. They cannot be considered good faith creditors.
In our opinion there is no statute of limitations to prevent the creditors of the estate from obtaining the delayed payment of their adjudicated claims, under the circumstances here existing.
The estate remains open, and in the charge and control of the probate court.
We are of the opinion that the probate court was right in granting license to sell, and that the order and judgment of the circuit court should be reversed, and the cause remanded, with instructions to enter an order affirming the order of the probate court, in accordance with this opinion, with costs to appellant.
Ostrander, C. J., and Bird, Moore, Steere, Brooke, Fellows, and Kuhn, JJ., concurred. | [
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Steere, J.
This case is supplemental to the litigation in Re Keene’s Estate, reported in 189 Mich. 97, which resulted in affirmance of a judgment on verdict of a jury rendered in the circuit court of Muskegon county sustaining .an alleged lost will of Alice Maynard Keene, a resident of Muskegon, who died in the city of Grand Rapids some time in December, 1918, supposed at the time to have left an estate of considerable magnitude, which upon probation proved so disappointing as to give rise to the present controversy, which is mainly a contention between her creditors and attorneys, engaged by her executor, to sustain her lost will, as to whether the latter’s fees or the creditors’ claims should have priority in the distribution of the assets of her estate.
The present litigation had its origin in objections interposed by certain of deceased’s creditors to allowance of portions of the “first annual account” and “first special account” of J. H. Banninga filed in the probate court as executor of deceased’s estate under her sustained lost will. Banninga was appointed executor in September, 1914, and his first annual account was filed September 7, 1915. His first special account was filed July 22, 1916. Amongst the items of those accounts which he sought to have allowed were numerous rendered bills of fees paid attorneys for professional service, amounting to $1,429.08, and claims of the executor for extra services aggregating $701.25. It is undisputed that most of the services rendered by attorneys whom the executor employed were in connection with the will contest, presumably begun and pursued in the interest of beneficiaries under the will, a litigation which could not affect the original quantum of the estate or the rights of creditors of deceased.
The substance of objections interposed before the probate court was that the allowed claims of creditors should first be paid, and should not be delayed or jeopardized by the will contest or expenses incurred in connection with it; the concluding objection summing up as follows:
“By the allowance of this claim and the allowance of the claim of attorneys claiming to represent the executor, the estate of the said deceased will be wholly insolvent. The attorneys’ bill to date, as filed, shows a claim of $2,425.90, and the executor’s account a claim of $701.25. Most of which charges are entirely out of proportion with the services rendered; some of them are illegal as expenses of administration in advance of the payment of creditors and show a studied attempt on the part of the executor to so admin-’ ister this estate that there will be nothing left for creditors, whose claims have been allowed by the court, and whose claims should first be paid, at least in advance of all claims except statutory fees.”
The probate court in passing upon the executor’s accounts held he should be allowed his statutory fees for services, $100 for attorney’s fees, and $200 additional for services and expenses, the order concluding as follows:
“It is ordered, that said accounts be and they are hereby allowed, except items aggregating $1,429.08 for attorneys’ fees and disbursements on account of suit in the circuit and Supreme Courts, which are hereby disallowed, except the sum of $100, without prejudice, however, to said executor to make claim for payments for attorney’s services when the creditors are paid; * * * that the executor be allowed the sum of $200 for his services and expenses, without prejudice to his right to make claim at some future accounting for compensation for extraordinary services.
“It is further ordered that said executor pay the sum now in his hands, to wit: Twenty-nine hundred eighty and 74/100 dollars, to the creditors of said deceased within 30 days from the date of this order.”
This order was affirmed, in substance, on appeal by the executor to the circuit court of Muskegon county.
The statement of facts in Re Keene’s Estate, supra, are helpful to an understanding of the controversy here and the situation as a whole which confronted the probate court when passing on appellant’s accounts.
On deceased’s death she left in Muskegon some tangible assets in the shape of real estate depreciated in value by the trail of the serpent over them in the use to which they had been devoted, and • some creditors whose claims this property was adequate to liquidate if devoted to that purpose through the ordinary processes, of probation. Her only ascertained relatives having possible interest in her estate were a brother and his family, living in Iowa, and a random husband from whom she was separated and against whom she had instituted divorce proceedings. Her life and associations had been such during the 20 years of her residence in Muskegon that beyond those things directly visible her financial circumstances and private affairs were matters of conjecture and gossip.
After Mrs. Keene’s death no will was found and upon petition of her brother from Iowa, Frank Maynard, an administrator was appointed, in December, 1913, and probation of her estate begun in the probate court of Muskegon county. Banninga was a real estate operator who had done some business for deceased during her lifetime and in 1900 drew her will for her in which he was nominated her executor. In June, 1914, he found in his desk what he testified was a pencil copy of the original will as he had drawn it for her, and, upon consultation with the attorneys who afterwards conducted the contest, advised Frank Maynard as one of the heirs to sign a petition for probation of the lost will. Banninga was the principal witness in the will contest and here. He testified in the instant case that he employed counsel for the purpose and the “total amount of the services rendered by the attorneys as shown by these statements is $2,425.90,” which from his experience in such matters he considered a reasonable charge for their services, and, in explanation of the uncertainties and embarrassments attending the undertaking, said: ■
“The arrangement was made that if the will was not established the attorneys were not to have any claim against me personally, but if the will was established they were to put in their bill for a reasonable amount to me as executor of the estate and I would see that they were paid. They stated to me that it was rather a complicated case and therefore more or less speculative, and that if they won they would expect a larger fee than if they didn’t win. They paid the costs until I became executor and took charge of the estate. The character of the parties themselves had something to do with the question of fees. The parties were irresponsible to a large extent, both Mr. and Mrs. Maynard being addicted.to the drug habit and Mrs. Keene herself had been known as Queen of the Sawdust in Muskegon and was also known as a famous sporting woman. She kept a number of houses of prostitution in Muskegon. Gust Keene, her husband, was an ex-saloonkeeper for a time and had the reputation of being an ex-convict. A good many of the witnesses and parties mixed up in the case were or had been inmates of houses of prostitution and were people of such character and reputation and these things were all talked over at that time.”
He was appointed by the probate court executor under the will, in September, 1914, and after qualifying as such took charge of the estate, administration of which had in the meantime been pending in the probate court as of one dying intestate. It was stated by counsel, without objection, that claims against the estate, some 12 or 14 in number, were passed upon by that court, June 20, 1914. Banninga testified that the total amount of claims allowed according to the files is $2,805.36, none of which had been paid by him, and the records show that they remain unpaid.
Banninga’s assertion that this was an “extraordinary case,” appears to be fairly borne out by his narrative in justification of his claim for extra compensation, relating the disappointments and difficulties he encountered in attempting to find and realize on the supposed assets. He testified that the general impression was from shortly after Mrs. Keene’s death until the appraisers made an inventory that her estate was worth $25,000 to $40,000, but when he qualified as executor it proved to be worth only about $7,000; that before her death Mrs. Keene owned many large and valuable diamonds and he had learned there were safety deposit boxes in Chicago in her name, to which color was added by the fact that “Bud Leonard” who claimed to have been with her in the Fort Dearborn bank “said there were large sums of money and jewels and diamonds and so forth”; promising to tell them “the number and so forth”; but they were unable to find a record of any such thing “after diligent search in numerous banks in Chicago, neither under the name of Stamp or Maynard or Keene or any other alias she used to go under,” and none of those things could be found, the result being that the assets of the estate which he was able to secure dwindled to a property called the St. Elmo hotel, upon which there was a mortgage, two properties which had been sporting houses, and some furniture. The probate judge informed him after he was appointed executor that the estate could not rent property for immoral purposes and if he did so he would likely get into trouble and in all probability go to jail; the State fire marshal also informed him the houses must be closed until the chimneys were rebuilt, and the mayor of Muskegon at one time told him “that the property must be cleaned up or the authorities would close it, on account of the filthy condition and the dilapidated state of affairs of the property.” But in spite of these embarrassments and various others which are detailed he states that “through my efforts I realized $7,000 for the estate”; he having on hand, as found by the probate and circuit courts, $2,980.74.
One somewhat serious objection suggested against appellant’s claim for increased fees and extra allowances, for services rendered in person and disbursement in the employment of attorneys and otherwise, is his failure to file the requisite statutory petition in the probate court presenting the unusual difficulties and responsibility which demanded the extraordinary services and disbursements for which allowance is sought. The executor’s fees and per diem are fixed by statute, in addition to which he is entitled to allowance of necessary expenses in care, management and settlement of the estate; beyond that the probate court may make allowance for “extraordinary services” on proper presentation and proof of the same authorizing the court to act. To move the court in that particular the statute provides, section 14118, 3 Comp. Laws 1915, that—
“In all cases where the executor or administrator shall perform any extraordinary services, not required of an executor or administrator in the common course of his duties, and in cases of unusual difficulty or responsibility, such further allowance may be made as the judge of probate shall deem just and reasonable: Provided, however. That such allowance shall only be made upon the filing of a petition therefor, setting forth in detail such extraordinary services, or the reasons for considering the case one of' unusual difficulty or responsibility, and the order making any such allowance shall recite in detail the extraordinary services. for which such allowance is made, giving the amount allowed for each item thereof, or the reasons for considering the case one of unusual difficulty or responsibility; and in case the order does not contain such recitals as herein required, the same shall be void and of no" effect.”
After the case had reached the circuit court on appeal, appellant’s counsel asked leave to amend his accounts into a more formal petition covering his claim for extraordinary services and expenses in conformance with the statute. This was held not within the power of the appellate court, because the matter had never been properly presented by petition, as the statute requires, to the probate court from which the appeal was taken and in which original jurisdiction rested. As applied to appellant’s own services, at least, this view finds support in the somewhat analogous case of In re Thompson’s Estate, 183 Mich. 618. The question is, however, of minor importance here, for both courts reserved to appellant the privilege of presenting the rejected items of his accounts by appropriate petition in the probate court “when the creditors are paid,” a sequence against which appellant seriously protests, and the real pivotal issue between these parties is whether charges by the executor for his special services and those of attorneys employed by him in a contest to establish a lost will, a matter of no concern to appellees, can be allowed or paid until the proved claims of creditors for debts incurred by deceased in her lifetime have been taken care of.
It seems self-evident that the quantum, of the estate as such could not be affected by whether there was or was not a will. It was a matter of indifference to the creditors what became of the residue of the estate after the debts were paid. It was nothing to them who the beneficiaries were, or whether they took by will or by inheritance. By statute the entire estate, real and personal, is held liable for deceased’s debts, after payment of the necessary expenses of administration, including costs of her last sickness and funeral. 3 Comp. Laws 1915, §§ 13794, 13887, 13888. Until the valid and properly proved claims of those who extended credit to deceased in her lifetime for money loaned, goods sold or services rendered are paid, the unearned gratuities to beneficiaries under her will or inheritances to her heirs are postponed and contingent, the corpus of the estate is subject to creditors’ liens and the surplus rather than the gross assets constitutes the actual estate left to deceased’s distributees or beneficiaries.
“The law subjects the assets of a deceased person to the payment of his debts, and for this reason the creditor has an equitable lien thereon, which he can enforce through, the administrator in a proper case for equitable interference.” Pierce v. Holzer, 65 Mich. 263, 273.
“Under our system the settlements of estates of deceased persons are essentially proceedings in rem (Howard v. Moore, 2 Mich. 226), as they are in most of the other States, in which the res is the decedent’s estate and the jus ad rem is in the creditor. Upon the death of a person leaving creditors, the debts, previously personal obligations, become immediately property obligations, with all the force of a lien upon a debtor’s estate.” Lafferty v. People’s Savings Bank, 76 Mich. 35, 51.
Cases cited by appellant where fees of counsel and other expenses incurred by an executor or administrator in prosecuting or defending litigation directed to increasing or conserving the amount of the estate are held to be proper expenses of administration because for the benefit of the whole estate as such, and will contests where no rights of creditors are involved, are not analogous in facts or point involved. Here the creditors are opposing diminution of an estate, upon which they have a lien, by the expenses of a litigation which jeopardized their claims and could not in any event be beneficial to them.
Under the circumstances of this case we are not impressed with appellant’s contention that it was his legal or moral duty to assume and aggressively conduct the prosecution of this will contest. He claimed no family or social relations with deceased nor personal obligations to her. He had simply done some business for her and at one time drawn her will at her request, in which he was named as executor, and had subsequently delivered the will to her. When she died he neither had possession of the will nor knew where it was, and it was never found. The statute is not directed to such a situation. Barney v. Barney, 192 Mich. 45. Had he been the custodian of it or known where or with whom it was deposited the statute invoked might be material. Conceding that in fairness and as a moral duty he should inform those who might be beneficiaries under the will or interested in the estate of the facts known to him, when he had done this his moral obligations were fulfilled except as those interested in the estate might require his services as a witness. When the lost will was finally sustained and admitted to probate, it was discretionary with the court to appoint him executor and if appointed he was under no legal obligations to accept the appointment. So far as any legal or moral obligations are concerned, he was perfectly free after advising those directly interested of the facts he knew to leave the will contest to them. After he became executor he represented the estate and as its assets reached his hands in due course of administration it was his duty to conserve and apply them according to law, under the direction of the court, in paying the debts, claims and charges against the estate in legal order of preference. The cost of a will contest between prospective distributees of a deceased person’s estate is not naturally or usually to be recognized as a reasonable or necessary charge incurred by reason of his or her death. As applied to the situation presented here, the right of the matter is well reasoned out in Mumper’s Appeal, 3 Watts & Serg. (Pa.) 441, where the status of those interested in an estate but not in a contest between heirs or beneficiaries is discussed in part as follows:
“As regards the quantum of the estate, it is a matter of indifference whether there be a will or not. Will or no will, is a question which cannot affect the estate, in this respect, in the slightest degree; but it may be, and generally is, a matter of great interest to those who claim as legatees or devisees under the writing purporting to be a will. They are the only persons interested in establishing it as a will. While, on the other hand, the heirs-at-law, or next of kin to the deceased, who are either excluded by the writing from receiving any portion of the estate, or as much of it as they would be entitled to in case of intestacy, are the persons principally interested in opposing the establishment of the writing as a will. If the person appointed by it as executor be named also, as a legatee or devisee, then as such he may be deeply interested also in establishing it to be the last will of the deceased. But it is clear that creditors and the rest of the world have no interest whatever in the question. It would, therefore, seem to be just, as well as equitable that those who have an immediate and direct interest in the question should be left to contest and bear all the costs and charges attending it. It ought to be left to them to employ counsel or not, as they please; and consequently to bear the expenses of doing so.”
Vide, also, 2 Woerner’s American Law of Administration (2d Ed.), § 516.
It is further contended for appellant that the cir cuit court, where the issue was tried de novo, had no right to make the order complained of because only the Michigan Trust Company, as executor of the Torrent estate, had filed formal objections to his accounts in the probate court, which were subsequently abandoned, or withdrawn when its duties as executor had ended, and the three creditors who appeared for the first time in the circuit court were not entitled to be heard or participate in the trial. The Michigan Trust Company as executor of the estate of John Torrent, a creditor of deceased, did file its objections in the probate court and was there represented by counsel who pressed the objections at the hearing in which that court passed upon the executor’s accounts. R. J. Macdonald, a creditor who testified that he also appeared in the matter in the court below, filed written objections in the circuit court and appeared in person at the trial. John D. Vanderwerp and the Pine Street Furniture Co., also creditors with proved claims, entered their appearance in the circuit court and were represented by counsel at the trial. Although at the time of trial in the circuit court the Torrent estate was in effect fully probated and the trust company’s duties of administration ended, no formal order discharging it as executor had been made or entered and counsel who appeared for it and other creditors in the circuit stated to the court: “I was informed that until they were discharged I was to continue the matter.”
All the creditors whose claims against the estate had been established were interested in this issue. No formal pleadings or objections were necessary in the probate court to entitle them to the benefit of the court’s order as made. Whether they filed objections or not it was the right and duty of the probate court to judicially pass upon the executor’s accounts and to disallow any items the court found unwarranted or illegal. Their rights were protected by the order until the executor’s appeal attacked them. The hearing in the circuit court was confined to the order appealed from and the same questions in relation to it which were before and passed upon by the probate court.
Even conceding that this step in the probation of an estate in compliance with statutory requirements that the court shall pass upon and allow the executor’s accounts becomes, on appeal, in its nature an action at law or suit in equity, we see no sound objection in reason or rule to the circuit court on trial of the same issues of law and fact de novo permitting those creditors clearly having an interest in the litigation to intervene “at any time,” and defend their rights in subordination to the main proceeding, as the ends of justice seemed to require, which is within the spirit, if not the letter, of sections 12362-12364, 3 Comp. Laws 1915.
Under the foregoing views on the meritorious and controlling questions involved, we find no technical demand for reversal in appellant’s various assignments of error and the judgment, or order, of the trial court is therefore affirmed.
Ostrander, C. J., and Bird, Moore, Brooke, Fellows, Stone, and Kuhn, JJ., concurred. | [
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] |
Kuhn, J.
In this proceeding-it is sought by mandamus to compel the respondent to enter an order granting the motion made by relator’s counsel to strike a cause in which relator was respondent, from the calendar.
The relator was bound over to the circuit court February 26,1918, on the charge of retailing liquor without a license. The recognizance called upon him to appear at the present term of the circuit court February 26, 1918, the then February term of the circuit court having commenced February 4, 1918. The next term of the circuit court would commence May 6, 1918. The relator appeared on February 26, 1918, as required by his recognizance, but no proceedings took place in court. On March 1st the justice made his return, and on March 16th an information was filed by the prosecuting attorney. On March 16th the relator was sent for and, according to the records of the court, was arraigned, the reading of the information was waived, and a plea of not guilty was entered. On March 18th, the relator’s attorney, being in court, was informed by the circuit court to be ready for trial forthwith, as the case would be taken up immediately after two other jury trials, were concluded. Relator’s attorney thereupon moved to have the case stricken from the calendar on the ground that it was improperly placed thereon. This motion was denied by the respondent.
Section 5, chap. 18, Act No. 314, Pub. Acts 1915 (judicature act, 3 Comp. Laws 1915, § 12577), provides :
"Cases in which issue shall be joined, or appeal filed, after the fourteenth day before the first day of any term of any court, may be placed upon the calendar at any time before or during the term, at the request of the attorney for any party thereto, which said attorney shall forthwith give notice in writing to all of the parties to said cause, or their attorneys, of the fact of placing such cause upon the calendar, and upon the giving of such notice, after the lapse of fourteen days the same shall stand for trial the same as other cases.”
It is agreed by counsel that the only question of law involved in- this proceeding is as to whether or not the provision of the judicature act above quoted applies to criminal cases; that is, if the defendant in a criminal case is bound over to the circuit court for trial at the present term of court, and the case is not on the calendar, does the 14-day notice required in civil cases apply, or can the respondent be tried at once unless there are other reasons for adjournment?
As the February term of the court has now passed, it is apparent that in the instant case this has now become a moot question. However, because of the public importance of the question involved, we will determine it upon its merits.
The act (Act No. 286, Pub. Acts 1913) by which the commission was appointed to draft the judicature act, is entitled:
“An act to provide for the appointment of a commission to prepare and report bills for the revision and consolidation of the general laws of this State relating to civil practice and procedure, domestic relations, and transactions (probably a misprint, and should be taxation) and other general laws, and to prescribe their duties and provide their compensation.”
' Section 1 of the act reads:
“It shall be the duty of the governor to appoint a commission consisting of three persons, not more than two of whom shall belong to the same political party, whose duty it shall be to prepare separate bills for the consolidation and revision of the general statutes of this State upon the following subjects:
“(a) The law relating to civil practice and procedure;
“(b) The law relating to domestic relations;
“(c) The law relating to general taxation;
“and to report the same to the governor on the completion thereof.”
While it is true that the commissioners were, by section 2 of said act, authorized to prepare revisions of the general statutes on such other subjects as they might consider in need of revision and consolidation, yet it was specifically provided that each subject with which they dealt should be embodied in a separate bill. The judicature act was the result of their work under subdivision (a.) of section 1 above quoted, which was confined to civil practice and procedure. The title of the judicature act expressly limits its operation to civil practice and procedure:
“An act to revise and consolidate the statutes relating to the organization and jurisdiction of- the courts of this State; the powers and duties of such courts, and of the judges and other officers thereof; the forms of civil actions; the time within which civil actions and proceedings may be brought in said courts; pleading, evidence, practice and procedure in civil actions and proceedings in said courts; to provide remedies and penalties for the violation of certain provisions of this act; and to repeal all acts and parts of acts inconsistent with, or contravening any of the provisions of this act.”
The only reference to criminal cases in the judicature act to which counsel have called our attention, in connection with the subject under consideration, is in the section prescribing the order in which the clerk shall place cases on the calendar, likewise found in Circuit Court Rule No. 40. That, however, has no significance. In order to insure to the accused the “speedy trial” to which he is entitled by the Constitution, it has always been the rule that criminal cases should have the preference and be first disposed of at each term. In a statute relating to the making up of a calendar of cases, it is of course impossible to provide that civil cases shall follow the criminal cases, without providing that the criminal cases shall come first. Hence the reference to criminal cases in this section. A similar provision was found in the statutes prior to the judicature act, and also in the court rules.
Prior to the judicature act, a person accused of a crime, arrested and examined by a magistrate during a term of the circuit court, might be bound over to appear at the present term of the court, and might be tried at that term. In Tiffany’s Criminal Law, pages 145, 146, it is said:
“The condition of the recognizance must show the court to which the accused is bound to appear, and must require him to appear at a time when the court will be in session; and it is said that if it bind him to appear on a day when the court does not sit, it will be void. If the court in which the case is to be tried is sitting at the time when the recognizance is taken, it ought to be for the appearance of the party at the present term or session of the court; and if not in session, then • for the first day of the next term thereof.”
And in foot-note 58, p. 432, it is stated:
“The information may be filed at the same term during which the complaint was made. It may be filed as soon as is found convenient. People v. Haley, 48 Mich. 497. It may be filed at the same term during which the respondent was held for trial for a felony ‘at the next term of the court.’ People v. Mason, 63 Mich. 510.”
In the last cited case, notwithstanding the respondent’s motion for a continuance, the trial was had during the afternoon of the same day on which the information was filed, which was but three days after the respondent was examined by the magistrate and bound over. It was. held this was not error.
In many States the rule is explicitly covered by statute, some requiring that the accused.be tried at the same term as arrested, if the court is then in session, others providing for bringing on cases by notices of trial. In Kansas the statute requires the trial to be at the present term, and the decisions have held that this must be done, even when the wording of the recognizance or of the magistrate’s return is “at the next term.” Where the matter is not covered by statute, the courts seem to hold that the accused may be tried at the present term. See Allen v. State, 9 Ga. 492; Page v. Commonwealth, 27 Grat. (68 Va.) 954. In the latter case it is said:
“The Code, it is true, provides that the commitment for trial, &c., "shall be in the next term of the circuit court for such county’; but that does not prevent a trial from being had at an existing term of the court, if one be then in existence. The object of the law is to have a speedy trial of a felony, and it therefore provides that the accused shall, unless good cause be shown for a continuance, be arraigned and tried at the first term of the court to which he is remanded or sent on for trial. Code, chap. 202, secs. 1 and 2. It might be very inconvenient and injurious, as well to the accused as to the commonwealth, to delay a trial necessarily to a future term of the circuit court, when there was one in existence at which it might just as well be had.”
Because of our conclusion that the terms of the judicature act providing for the 14-day notice do not apply to criminal cases, it follows that the relief here sought by relator must be denied.
Ostrander, C. J., and Bird, Moore, Steere, Brooke, Fellows, and Stone, JJ., concurred. | [
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Kuhn, J.
On July 4, 1915, plaintiff’s intestate, John P. Hickey, a man about 60 years of age, was driving an automobile in a southerly direction along Twelfth street in the city of Detroit, and while attempting to -cross the tracks of the defendant company on Porter street, was struck by one of defendant’s street cars and received injuries from which he died a short time afterwards.
The track on Porter street is a single track, over which the Sherman-street cars travel in a westerly direction. Ordinarily no other cars use this portion of the track, but on the day of the accident the Baker-street cars, owing to some obstruction in their usual line of travel, had been re-routed so as to make their trip west along this part of Porter street, and it was a Baker-street car which collided with the automobile of the deceased. The block extending from Twelfth street easterly to Tenth street is an unusually long one, Eleventh street not being opened at Porter street, and most of the way along this block the cars run on a down grade. About 450 feet west of Twelfth street (and just beyond Vermont avenue) there is a high bridge upon which the street cars pass over some rail road tracks, and the rise in the grade from a point about 213 feet west of the center of Twelfth street to the top of this bridge is quite steep. The width from curb to curb on Porter street varies from 28 feet just east of Twelfth street to 29.4 feet just west of Twelfth street, and the distance from the car track to the curb on either side is about 12 feet. Twelfth street from curb to curb is about 30 feet wide at this point.
Mr. Hickey had been driving down Twelfth street at a speed estimated between'-lO and 15 miles an hour, but, as he approached Porter street, slowed down to 6 or 7 miles an hour and looked in the direction of the approaching car, which was then about 125 feet east of the east curb of Twelfth street. He was then about 15 feet from the car track, and almost immediately accelerated the speed of the automobile and attempted to cross. The street car was going at a high speed, estimated by some of the witnesses as at least 30 miles an hour. The motorman was called by the plaintiff as an adverse witness for cross-examination. He testified that the car was going at full speed and down grade, but estimated the speed as 18 or 20 miles an hour, stating that he did not believe the car could go any faster than that. He admitted having testified at the coroner’s inquest that the car was going 30 miles an hour, but insisted that he was mistaken and from' later experience and observation believed that 18 or 20 miles an hour was a more correct estimate. He admitted that the car was going as fast as any he ever operated, and that he had never seen a street car in the city of Detroit travel faster than he was going at the time of the accident. He further testified that he first saw the automobile when he was about 150 feet from Twelfth street; that it was slowing down and was about even with the north curb of Porter street; that- it traveled a few feet before its speed began to accelerate, at which time his car was about 100 feet from the east curb of Twelfth street; that he then began to do something to stop his car, but not all that he could have done, because at that time he “judged it was going to get across the track;” that when he was within 50 feet of the east curb of Twelfth street he came to the conclusion that the automobile could not get across safely, and that he then threw off the current and reversed the car and kept the reverse on until the car came to a stop about 100 feet beyond the west curb of Twelfth street.
At the close of. the testimony the defendant moved the court to direct a verdict in its favor, which motion being overruled, the court was thereupon requested to reserve final decision of the question under the Empson act (Act No. 217, Pub. Acts 1915, 3 Comp. Laws 1915, § 14568 et seq.), and such reservation was made. The case was submitted to the jury, who returned a verdict for the plaintiff of $7,000, upon which judgment was duly entered. Defendant thereupon filed a motion for a new trial or for judgment non obstante veredicto. This motion was denied, and defendant filed written exceptions to the decision of the court thereon.
Appellant’s counsel have argued the 25 assignments of error under eight heads. We think the following discussion will fairly dispose of the case.
The first four assignments allege error in connection with the examination pf the witness Percy Morgan, the motorman of the car, who was called by the plaintiff under the statute for cross-examination. He had been a witness at the coroner’s inquest, and his testimony at the trial of the present case varied somewhat from that given at the inquest. Concerning these inconsistencies he was closely questioned by plaintiff’s counsel. Complaint is made that counsel did not confine his efforts to showing previous contradictory testimony, but that, without first bringing out any affirmative statements on the point in question, he tried to bring out and read into the record as affirmative evidence the testimony of this witness before the coroner. An examination of the record discloses that when reference was first made to this prior testimony, the witness had just stated that he did not know whether or not the speed of the car he operated at the time of the accident was 30 miles an hour. He explained that more than two years had elapsed since the accident, and that some of the details had slipped Ms mind; that the details as to speed, distances, etc., were fresher in his mind within a week or two after the accident than at the time he was being questioned in this case. It was then that plaintiff’s counsel began to read to Mm certain questions and answers from his testimony at the inquest, manifestly for the purpose of refreshing his recollection as to these details. But the witness, instead of either verifying his estimate of 30 miles an hour as given at the coroner’s inquest, or reiterating his former statement that he did not know, shifted his ground and asserted quite positively a new estimate of the speed, claiming that while he had given his testimony at the inquest in perfect good faith, yet further experience as a motorman had convinced him that he had then overestimated, and wished to state that he would fix the maximum speed of the car at 18 or 20 miles an hour. He could give no definite basis for this belief, had made no tests or anything of the kind, but insisted that that was his best judgment at the time of the trial.. We are unable to discern any effort on the part of counsel to make the questions and answers given at the coroner’s inquest affirmative evidence in this case, but are clearly impressed that the original purpose in referring to them was to refresh the memory of the witness, and ; upon his denying the correctness of Ms previous testimony, to use it in testing the credibility of the witness. There was other affirmative evidence as to the speed of the car.
Assignments of error 6 to 11 relate to the refusal of the court to direct a verdict in favor of the defendant on the ground that there was no proof of negligence on the part of defendant and also for the reason that plaintiff’s intestate himself was guilty of negligence contributing to the injury. Cases in which a plaintiff has been injured by being struck by a car while attempting to cross the tracks ahead of it, fall into two classes, first, those in which the circumstances clearly show an entire failure on the part of the plaintiff to look for the car, or at best a mere careless glance, or else evident recklessness in making the attempt to cross. See Borschall v. Railway, 115 Mich. 473; Hilts v. Foote, 125 Mich. 241; Merritt v. Foote, 128 Mich. 367; Colborne v. Railway, 177 Mich. 139; Miller v. Railway, 200 Mich. 388; second, cases where the plaintiff saw the approaching ear and decided there was sufficient time to cross ahead of it, under circumstances which do not clearly show recklessness in the formation of such judgment. See Ryan v. Railway Co., 123 Mich. 597; Chauvin v. Railway, 135 Mich. 85; Gaffka v. Railway, 143 Mich. 456; LaLonde v. Traction Co., 145 Mich. 77; Seebach v. Railways Co., 177 Mich. 1; Hildebrandt v. Railway, 200 Mich. 52. In cases of the first class we have held that a verdict should be directed for the defendant, and it is this line of cases upon which appellant’s counsel rely, particularly the case of Colborne v. Railway, supra. But in the latter case it is expressly stated:
“This is not of that class of cases in which the car has been seen, and the plaintiff, reasonably believing a crossing could safely be made, has attempted to cross, and been injured, owing to the fact that the car was run at an excessive rate of speed, or being otherwise negligently operated, and therefore the question of whether plaintiff, in the exercise of common pru dence, might have reasonably judged there was sufficient time to pass became a question of fact, upon which opinions might reasonably differ.”
The quotation well describes the second class of cases above referred to, and we think it is clear that the instant case falls within this class. Here the motorman was admittedly operating his car, in a thickly settled district of the city, at the extreme limit of its speed;, he admits that he realized, when he was at least 100 feet from the crossing, that the automobile was attempting to cross the track ahead of his car,, yet he not only failed to reduce the speed sufficiently to avoid the collision, but did not succeed in bringing his car to a stop short of 100 feet beyond the west curb of Twelfth street. He admits that he did not at once take extreme measures to stop the car, because he judged that decedent had time to cross safely. Yet, under these circumstances, defendant takes the position that the motorman’s conduct was not negligent, but that decedent, in relying upon a similar judgment on his own, part, was, as a matter of law, guilty of contributory negligence. Deceased had brought his automobile under control on approaching Porter street, had looked towards the approaching car, and apparently had reached the conclusion that there was ample time to cross in safety. From the fact that the automobile was struck at the hub of the rear wheel it is apparent that, had the car been going at almost any speed less than its extreme limit on a down grade, his judgment would have been correct. In such cases the question is one for the jury.
Some complaint is also made concerning the charge of the court, and that the verdict is against the weight of the evidence. In view of our conclusion that the question of the negligence of the defendant and the contributory negligence of plaintiff’s intestate were questions properly to be submitted to the jury, an ex amination of the charge is convincing that the issues thus presented were clearly and fairly presented to the jury with proper instructions, and there was sufficient evidence to sustain the verdict. The court did not err in denying the motion for a new trial based on this ground.
We find no error, and the judgment is therefore affirmed.
Ostrander, C. J., and Bird, Moore, Steere, Brooke, Fellows, and Stone, JJ., concurred. | [
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Corrigan, J.
Plaintiff Patricia A. Witt appeals as of right the Macomb Circuit Court’s order de dining jurisdiction and dismissing her November 7, 1989, complaint. We reverse and remand for action consistent with this opinion.
Plaintiffs complaint alleged that she was injured sometime in November 1987 when an unknown, obviously intoxicated male customer of defendant’s bar and restaurant located in Toledo, Ohio, assaulted and beat her. In count i, she claimed that defendant’s employees failed to assist her, failed to restrain the drunken customer, and failed to notify the police. She asserted claims of premises liability and Ohio dramshop act violations (Ohio Rev Code Ann §4399.01) as bases of liability. In count ii, plaintiff Mickey D. Witt, Patricia Witt’s husband, claimed loss of consortium.
The Witts reside in Monroe County, the Michigan county closest to Lucas County, Ohio, where Toledo is located. Defendant, a Michigan corporation, did business in Toledo, Ohio, and did and does business in Mt. Clemens, where its current resident agent is located. The only connection to Macomb County is the location of defendant’s corporate headquarters; this case otherwise has no relation to Macomb County.
Defendant moved the lower court to decline jurisdiction on the ground of forum non conveniens or, in the alternative, to change venue to Lucas County, Ohio. Defendant also claimed that plaintiff failed to satisfy the venue requirements of MCL 600.1629; MSA 27A.1629, because no part of the cause of action arose in Macomb County. At oral argument on the motion in the lower court, defendant suggested that venue could be changed to Monroe County._
In dismissing the case, the lower court ruled in part:
The court is aware that the Michigan Venue Statute [MCL 600.1621; MSA 27A.1621] controls this matter. The court also has reviewed the various factors or elements taken into consideration with regard to jurisdiction, respecting jurisdiction and after reviewing the various factors the court cannot see how this court can do justice to one side or either side in this matter. Such factors as the availability of compulsory process of tenants [sic] or the unwilling and the costs of obtaining willing witnesses, the ease of access to source of proofs, distance from the situs of the accident or incident, in this case incident, the enforceability of any judgment obtained, possible harassment by either party, other practical problems contributing to ease, expense and expedition of trial. The court realizes that the main office, after what counsel has said, is here in the City of Mount Clemens or Clinton Township for the defendant, C.J. Barrymore’s. Nevertheless, they are doing business down in Toledo, Ohio and accordingly the motion to decline jurisdiction or in the alternative for change of venue is hereby granted.
An appellate court tests a lower court’s decision to apply the doctrine of forum non conveniens by applying an abuse of discretion standard. Cray v General Motors Corp, 389 Mich 382; 207 NW2d 393 (1973); Spalding v Spalding, 355 Mich 382, 384-385; 94 NW2d 810 (1959). In declining jurisdiction in this case, the trial court noted easy access to the sources of proofs in Ohio, the availability of compulsory process in Ohio courts for the attendance of unwilling witnesses and the lower costs of obtaining cooperating witnesses, and convenient access to the injury site, as well as the application of Ohio law.
Michigan is, however, a natural and proper forum for this lawsuit. Maintenance of suit here is neither vexatious nor oppressive. Williams v Green Bay & W R Co, 326 US 549; 66 S Ct 284; 90 L Ed 311 (1945). The flaw in the lower court’s reasoning was its failure to recognize that both plaintiffs and defendant are Michigan residents. The doctrine of forum non conveniens applies only where the parties are residents of different states, neither are residents of the forum state, and the injury or event giving rise to the cause of action occurred other than in the forum state. As observed in dicta in Duyck v Int'l Playtex, Inc, 144 Mich App 595, 602-603; 375 NW2d 769 (1985):
Forum non conveniens is applicable only where the parties are residents of different states, neither are residents of the forum state, and the injury or event giving rise to the suit occurred other than in the forum where suit, was brought. Under this doctrine, jurisdiction is refused by the court and the suit is dismissed. This doctrine, should it be applied in a suit involving a party who resides in Michigan, would be contrary to this state’s concept of one court of justice. Const 1963, art 6, § 1. See also Anderson v Great Lakes Dredge & Dock Co, 411 Mich 619; 309 NW2d 539 (1981).
The instant dispute is not "imported litigation,” even though the alleged injury occurred out of state, because both plaintiffs and defendant reside in Michigan. Defendant is incorporated here and has its principal place of business here, while plaintiffs live in Monroe County. In ignoring these critical factors, the court abused its discretion.
In this case, however, there is no nexus between plaintiffs’ causes of action and Macomb County. Venue plainly does not lie in Macomb County pursuant to MCL 600.1629(l)(a); MSA 27A.1629(1) (a), because no part of the cause of action arose there. MCL 600.1629(l)(a); MSA 27A.1629(l)(a) provides:
A county ih which all or a part of the cause of action arose and in which either of the following apply is a proper county in which to commence and try the action:
(i) The defendant resides, has a place of business, or conducts business in that county.
(ii) The registered office of a defendant corporation is located in that county.
In Johnson v Simongton, 184 Mich App 186; 457 NW2d 129 (1990), this Court recognized that where a defendant challenges venue, the plaintiff has the burden to establish that the county he chose is a proper venue. The Court also recognized that the primary concern is that venue first be proper in the county where all or a part of the cause of action arose, citing Marsh v Walter L Couse & Co, 179 Mich App 204, 208; 445 NW2d 204 (1989).
In a cause of action arising from a tortious injury, the plaintiff must establish the defendant’s legal duty to the plaintiff, the breach of that duty, proximate causation between the breach of duty and the injury, and resultant damages. Lorencz v Ford Motor Co, 439 Mich 370, 375; 483 NW2d 844 (1992). Plaintiff’s premises liability and dramshop claims appear to arise from duties owed in Ohio. Additionally, questions concerning breach of duty and proximate cause involve events that transpired in Ohio. Plaintiffs’ damages arose either in Ohio or in Monroe County.
Under the controlling venue statute, venue is proper in Monroe County. MCL 600.1629(l)(b); MSA 27A.1629(l)(b) provides:
If no county satisfies the criteria under subdivision (a), a county in which all or a part of the cause of action arose and in which either of the following apply is a proper county in which to commence and try the action:
(i) The plaintiff resides, has a place of business, or conducts business in that county.
(ii) The registered office of a plaintiff corporation is located in that county.
A portion of plaintiffs’ claimed economic, noneconomic, and loss of consortium damages appear to have arisen in Monroe County. The lower court did not rule on venue in Monroe County, although defendant had posed it as an option. However, the lower court did not have the benefit of the Lorencz decision when it ruled. Accordingly, we remand for transfer of this case to Monroe County pursuant to MCL 600.1629(l)(b)(i); MSA 27A.1629(l)(b)(i). We do not retain jurisdiction.
Remanded.
Defendant has never explained by what authority a Michigan court could order a change of venue to an Ohio court. | [
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Levin, J.
Reuben Moore was convicted by a jury’s verdict for unlawful possession of a narcotic drug and sentenced to serve a prison term of eight to ten years. The Court of Appeals, in an unpublished per curiam opinion, affirmed, reducing the minimum term of Moore’s sentence to six years and eight months on the authority of People v Tanner, 387 Mich 683; 199 NW2d 202 (1972).
The issues concern:
1) the validity of the warrantless seizure of the narcotic drug during a cursory examination incident to Moore’s valid arrest for an unrelated crime;
2) the admissibility of Moore’s prior convictions for the purpose of impeaching his credibility;
3) a claim that Moore was not represented by counsel at the times of the earlier convictions and, therefore, even if prior convictions are generally admissible, these prior convictions were not admissible and, similarly, they should not have been considered at the time of sentencing;
4) a claim that Moore was denied the effective assistance of counsel because his trial lawyer failed to preserve any of the foregoing objections.
I
In People v Ginther, 390 Mich 436; 212 NW2d 922 (1973), we recently held that, to the extent a claim of ineffective assistance of counsel depends on facts not of record, the defendant must make a testimonial record at the trial court level which evidentially supports his claim and which excludes reasonable hypotheses consistent with the view that his trial lawyer represented him adequately. The requisite motion was not filed, and therefore, we do not have a record or findings by a trial judge to review.
However, Moore could not have been convicted unless there had been admitted in evidence the heroin seized as an incident to his arrest. Therefore, if it appears from the trial record that had a motion to suppress been made it should have been granted, an appellate court may properly grant relief even though the issue was raised for the first time on appeal.
II
Two Flint police officers, dressed in civilian clothes, as part of the vice squad’s operations to curtail street prostitution, were patrolling a "problem area” in an unmarked car. They observed several female and male subjects on the street and a female talking to a man in an automobile. Suspecting that she was attempting to solicit someone in that automobile, they pulled their automobile over to the curb. Almost immediately, Moore approached and inquired whether the officers would be interested in engaging the services of a prostitute. An officer stepped from the car and placed Moore under arrest "for soliciting for immoral purposes”.
Moore placed his hand in his pants pocket. The officer, believing Moore might be reaching for a weapon, grabbed him and spun him against the side of an automobile. Moore then opened his right hand and a small plastic vial fell to the ground.
The vial was of clear plastic with a snap-on top of the kind commonly used by pharmacies to dispense medicine. The vial was unlabeled. Inside were 20 small capsules containing white powder. Eighteen capsules were of clear plastic and the other two were red. The capsules lacked the fresh, uniform appearance typical of capsules dispensed by a pharmacy. Immediately upon taking Moore to the police station, 3 the officer conducted a cursory examination of the vial, concluded that the capsules contained heroin, and then arrested Moore on a narcotics charge.
In two recent cases decided by the United States Supreme Court, United States v Robinson, 414 US 218; 94 S Ct 467; 38 L Ed 2d 427 (1973), and Gustafson v Florida, 414 US 260; 94 S Ct 488; 38 L Ed 2d 456 (1973), the defendants were arrested for traffic offenses, taken into custody, and searched for weapons. In Robinson, during the search the arresting officer uncovered a crumpled cigarette pack. His cursory examination of the pack revealed 14 gelatin capsules of white powder which he thought to be and, upon subsequent analysis, proved to be heroin. In Gustafson, the arresting officer’s search yielded a Benson and Hedges cigarette box. Upon his cursory examination "it appeared there were marijuana cigarettes in the box”.
The Court summarized its holding in Robinson: "[I]n the case of a lawful custodial arrest a full search of the person is not only an exception to the warrant requirement of the Fourth Amendment, but is also a 'reasonable’ search under that Amendment,” and then concluded:
"Having in the course of his lawful search come upon the crumpled package of cigarettes, [the arresting officer] was entitled to inspect it; and when his inspection revealed the heroin capsules, he was entitled to seize them as 'fruits, instrumentalities or contraband’ probative of criminal conduct.” (p 236.)
These opinions were written by Mr. Justice Rehnquist who, in an earlier case, said for the Court: "The ultimate standard set forth in the Fourth Amendment is reasonableness.” Cady v Dombrowski, 413 US 433, 439; 93 S Ct 2523, 2527; 37 L Ed 2d 706, 713 (1973).
In both Robinson and Gustafson there were motions to suppress and full hearings concerning the reasonableness of the seizure. Moore did not move to suppress and there is no reason on this record to question the reasonableness of the arrest ing officer's belief upon his cursory examination that the white powder contained in the aberrant transparent capsules in the curiously unmarked, transparent vial was heroin.
While Const 1963, art 1, § 11 protects against "unreasonable searches and seizures”, its proviso prohibiting the exclusion from evidence of "any narcotic drug, firearm, bomb, explosive or any other dangerous weapon, seized by a peace officer outside the curtilage of any dwelling house”, precludes a construction of the Michigan search and seizure clause imposing a higher standard of reasonableness ****6 for searches and seizures of items named in the proviso than the United States Supreme Court has held applicable under the Fourth Amendment. In People v Pennington, 383 Mich 611; 178 NW2d 471 (1970), this Court held the narcotic and firearms proviso invalid under the Federal constitution only to the extent it would permit receipt of evidence barred under the Fourth and Fourteenth Amendments as construed by the United States Supreme Court.
Ill
In contrast with People v Jackson, 391 Mich 323; 217 NW2d 22 (1974), Moore’s attorney did not ask the judge to exclude, in the exercise of discretion, reference to Moore’s prior conviction record. Since he did not invoke the judge’s discretion, Moore cannot fault the judge for failing to exercise it when he allowed impeachment on the basis of prior convictions.
Refusing to consider this unpreserved issue on its merits is not inconsistent with resolution of the similarly unpreserved search and seizure issue on its merits. Moore could not have been convicted without introduction of the heroin; the impeachment of Moore by reference to his past convictions was not necessarily decisive. Additionally, Jackson does not require a trial judge to exclude reference to a defendant’s conviction record; it only requires that he exercise his discretion before deciding whether to permit reference to a conviction record. In contrast, a judge presented with a meritorious search and seizure claim is obliged to exclude the impermissibly obtained evidence.
IV
In United States v Tucker, 404 US 443, 445-446, 448; 92 S Ct 589, 591-592; 30 L Ed 2d 592, 595, 597 (1972), the United States Supreme Court, in a post-conviction proceeding instituted a number of years after Tucker’s conviction, affirmed the judgment of the Ninth Circuit remanding the case to the district court for resentencing "without consideration of any prior convictions which are invalid under Gideon v Wainwright, 372 US 335 [83 S Ct 792; 9 L Ed 2d 799; 93 ALR2d 733 (1963)].”
Tucker’s three previous state felony convictions preceded Gideon. It was established that two of them were constitutionally infirm because Tucker "had been unrepresented by counsel, and that he had been 'neither advised of his right to legal assistance nor [had] he intelligently and understandingly waive[d] [his] right to the assistance of counsel’ ”. 404 US 445. The Court, while reasserting the "wide discretion” granted a judge in sen- fencing, remanded for resentencing because the sentence "might have been different if the sentencing judge had known that at least two of the respondent’s previous convictions had been unconstitutionally obtained”. The Court observed that if the sentencing judge "had been aware of the constitutional infirmity of two of the previous convictions, the factual circumstances of the respondent’s background would have appeared in a dramatically different light at the sentencing proceeding”. 404 US p 448.
Although Tucker arose in a Federal post-conviction proceeding challenging a Federal conviction and sentence, its retroactive application to state convictions has been accepted by a number of state courts, including our Court of Appeals. We conclude, in light of the consistent retroactive application in state criminal proceedings of Gideon and its progeny’s expansion of the right to counsel, 11 that Tucker is applicable with full retroactivity to all sentences imposed by Michigan courts.
In Loper v Beto, 405 US 473, 480; 92 S Ct 1014, 1018; 31 L Ed 2d 374, 380 (1972), the Court, again reiterating its guiding principle that "a conviction obtained in violation of Gideon v Wainwright [cannot] be used against a person either to support guilt or enhance punishment for another offense”, further extended Gideon by affirmatively answering the question posed in the petition for certiorari: "Does the use of prior, void convictions for impeachment purposes deprive a criminal defendant of due process of law where their use might well have influenced the outcome of the case?” As Loper was a Federal habeas corpus proceeding challenging a state court conviction and itself applied its principle with full retroactivity, its holding and retroactivity is directly applicable to state court proceedings.
V
Moore, anticipating neither Tucker nor Loper, did not make a factual record at the trial level regarding the invalidity of his prior convictions. The prosecutor has remedied this deficiency by furnishing, in one case, a copy of the docket entries showing that Moore apparently had counsel and, in the other case, a transcript evidencing Moore’s proffer and the acceptance of his plea of guilty. The transcript shows that Moore did not have counsel and, although he pleaded poverty, he was not offered counsel.
The apparently invalid conviction was a 1949 conviction for breaking and entering in the nighttime. The apparently valid conviction was in 1958 for illegal possession of narcotics. Proceeding on these assumptions, we cannot find that the impeachment of Moore on the basis of his 1949 conviction "might well have influenced the outcome of the case” and accordingly we find no violation of Loper. Moore was charged in this case with possession of narcotics. Once Moore was impeached on the basis of his apparently valid 1958 conviction for possession of narcotics, the credibility of his defense that the vial was not his was so undermined that his credibility could not have been further damaged by reference to his apparently void 1949 conviction. We, accordingly, affirm his conviction.
While a harmless error rule might also be applied to a Tucker claim, from a practical point-of-view, in contrast with a Loper claim which if meritorious requires a new trial, in most cases a judge can more readily resentence a convicted person than determine whether whatever consideration was given an invalid conviction at sentencing was harmless. Also, a determination of harmlessness would invite further appeal. And, even more importantly, the United States Supreme Court has indicated that the question is whether the sentence "might have been different” if the sentencing judge had known that the earlier convictions had been unconstitutionally obtained. (Emphasis supplied.) United States v Tucker, supra, p 448.
As in Tucker, supra, p 447, the "record in the present case makes evident that the sentencing judge gave specific consideration” to Moore’s previous invalid conviction before imposing sentence. We, therefore, need not decide whether, if the record was less clear, there should be a preliminary inquiry whether the sentencing judge considered the invalid conviction.
The rule which we glean from what the United States Supreme Court did in Tucker is that where the record shows that the sentencing judge considered a conviction invalid under Gideon an appellate court will remand for resentencing. Accordingly, we remand for resentencing.
VI
In the future, post-sentencing Tucker claims should be initially decided by the sentencing judge or his successor. He is in the best position to explore and decide the factual issues and, if necessary, the defendant can then be resentenced. The Court of Appeals may refrain from considering a Tucker claim until the sentencing court has had an opportunity to resolve it.
To invoke a Tucker hearing, the defendant must (1) present prima facie proof that a previous conviction was violative of Gideon, such as a docket entry showing the absence of counsel or a tran script evidencing the same; or (2) present evidence that he has requested such records from the sentencing court and it has failed to reply or has refused to furnish copies of records within a reasonable period of time, say four weeks. Upon such presentation, either (1) or (2), the burden will then be upon the prosecutor to establish the constitutional validity of the prior conviction. Thus, if the prosecutor contends that the defendant waived counsel, the burden will be on him to show affirmative record evidence of waiver.
If the prosecutor obtains and furnishes the judge and the defendant or his lawyer with photocopies of records establishing the constitutional validity of the prior conviction, the judge may decide the matter on the papers presented unless the defendant, on notice, shows cause to hold a hearing at which he is present. Unless the prosecutor furnishes such evidence within one month of the defendant’s motion, the judge shall set the matter for an early hearing and order the production of the defendant at the hearing.
We have considered the collateral attack doctrine set forth in People v Gavin, 50 Mich App 743; 213 NW2d 758 (1973), urged upon us by the prosecutor, but are unpersuaded. A defendant will not be required "first [to] establish in separate post-conviction actions that the underlying convictions are invalid”. Clearly, a Michigan trial court is competent to resolve the factual issues regarding the constitutional validity of a defendant’s previous Michigan convictions. A Michigan court may also properly determine the validity of convictions in other state courts and the Federal courts for the limited purpose of reassessing the validity of a Michigan sentence.
Requiring a defendant seeking Tucker relief from a Michigan sentence to first attack the previous underlying convictions in the trial courts where he was convicted would unnecessarily add legal steps and compound the misery, not only for the defendant and any lawyer who may be representing him, but also for the taxpayers who ultimately foot the bill for all these procedures. Most all these claimants will still be indigent, by definition with prior records, probably lengthy sentences and quite willing to besiege the courts until the matter is resolved on the merits.
Conviction affirmed. Remanded for resentencing.
T. M. Kavanagh, C. J., and T. G. Kavanagh, Swainson, Williams, M. S. Coleman, and J. W. Fitzgerald, JJ., concurred with Levin, J. .
MCLA 335.153; MSA 18.1123.
See People v Smith, 260 Mich 486; 245 NW 502 (1932); People v Steeneck, 247 Mich 583; 226 NW 231 (1932); People v Ibarra, 60 Cal 2d 460; 34 Cal Rptr 863; 386 P2d 487 (1963); People v Johnson, 38 Ill 2d 399; 231 NE2d 447 (1967).
Cf. Chambers v Maroney, 399 US 42; 90 S Ct 1975; 26 L Ed 2d 419 (1970); People v Weaver, 35 Mich App 504, 513; 192 NW2d 572 (1971).
The officer knew Moore "from before” — "a number of years ago”. Moore testified, "if he knew me from the past he would have known” that Moore had a prior narcotics record.
Moore was not, in contrast with the defendants in Robinson and Gustafson, arrested for á traffic offense.
Mr. Justice Powell, concurring in Robinson and Gustafson, recognized the common experience that it is not customary to arrest for many relatively minor traffic offenses:
"In Gustafson, post, p 260, the petitioner conceded the validity of the custodial arrest, although that conclusion was not as self-evident as in Robinson. Gustafson would have presented a different question if the petitioner could have proved that he was taken into custody only to afford a pretext for a search actually undertaken for collateral objectives. But no such question is before us.” United States v Robinson, supra, p 238, fn. 2.
In a footnote to the opinion of the Court in Robinson, the Court discussed Robinson’s claim that the arresting officer may have been aware of Robinson’s record of two prior narcotics convictions and may have used the traffic violation arrest "as a mere pretext for a narcotics search which would not have been allowed by a neutral magistrate” had the officer sought a warrant. Police department regulations required an officer summarily to arrest and take to the station house for booking a person, such as Robinson, who is arrested for operating a motor vehicle after revocation of his operator’s permit. The Supreme Court responded to Robinson’s argument:
"We think it is sufficient for purposes of our decision that respondent was lawfully arrested for an offense, and that Jenks’ [the arresting officer’s] placing him in custody following that arrest was not a departure from established police department practice. * * * We leave for another day questions which would arise on facts different from these.” United States v Robinson, supra, p 221, fn. 1.
In People v Gonzales, 356 Mich 247, 255; 97 NW2d 16 (1959), this Court answered in the negative the following question: "May police who stop an automobile on a Michigan highway to issue a traffic ticket also routinely search the automobile under Michigan law?” The Court observed that, "the officers had no intention of incarcerating Leal [the driver] or detaining him further. There were no fruits of the traffic offense to search for, nor any need to search for the means by which it had been committed. And since no further detention was contemplated, there was no need to search for weapons or other means of possible escape from custody.”
Robinson and Gustafson do not conflict with Gonzales; as the United States Supreme Court carefully noted the validity of the custodial arrests was not challenged in either case.
We express no opinion about the propriety of a warrantless seizure and examination by someone other than the arresting officer or about an examination not conducted incidental to the custodial arrest or immediately following at the station house, or about the constitutional validity of an examination by the arresting officer of the seized material any more intensive or time-consuming than a cursory examination like those conducted by the arresting officers in Robinson, Gustafson and this case. Cf. People v Trudeau, 385 Mich 276, 279-281; 187 NW2d 890 (1971); People v Roderick Walker, 27 Mich App 609; 183 NW2d 871 (1970).
Contrast State v Elkins, 245 Or 279; 422 P2d 250 (1966), and Caver v Kropp, 306 F Supp 1329 (ED Mich, 1969).
Cf. People v Turner, 390 Mich 7; 210 NW2d 336 (1973) (entrapment); People v White, 390 Mich 245; 212 NW2d 222 (1973) (double jeopardy), where this Court established standards higher than the Federal standards.
Similarly see People v Pollard, 39 Mich App 291; 197 NW2d 546 (1972); People v Downs, 45 Mich App 130; 206 NW2d 241 (1973); People v Calvin Jones, 44 Mich App 633, 638; 205 NW2d 611 (1973).
Towers v Director, Patuxent Institution, 16 Md App 678; 299 A2d 461 (1973); Howard v State, 280 So 2d 705 (Fla App, 1973); State v Flores, 511 P2d 414 (Or App, 1973). Similarly, see Collins v State, 129 Ga App 87; 198 SE2d 707 (1973) and Baldwin v State, 499 SW2d 7 (Tex Crim App, 1973), which may, however, have been tried after Tucker was decided.
The Supreme Court of Pennsylvania cited the necessity to follow Tucker as one of the reasons for adopting a policy of mandatory presentence disclosure. Commonwealth v Phelps, 450 Pa 597; 301 A2d 678, 683-684 (1973). Cf. People v McGaha, 10 Ill App 3d 1051; 295 NE2d 476 (1973).
People v Eugene Jones, 47 Mich App 160; 209 NW2d 322 (1973); People v Gavin, 50 Mich App 743; 213 NW2d 758 (1973).
Loper v Beto, 405 US 473; 92 S Ct 1014; 31 L Ed 2d 374 (1972); Doughty v Maxwell, 376 US 202; 84 S Ct 702; 11 L Ed 2d 650 (1964); Pickelsimer v Wainwright, 375 US 2; 84 S Ct 80; 11 L Ed 2d 41 (1963) (Gideon fully retroactive); Burgett v Texas, 389 US 109; 88 S Ct 258; 19 L Ed 2d 319 (1967) (a defendant cannot be tried under a recidivist statute when he did not have counsel at the time of his prior convictions).
Loper v Beto, p 481, quoting Burgett v Texas, supra, p 115.
Several state courts on the constitutional authority of Loper’s predecessors had already evolved an exclusionary rule like the rule established in Loper prior to the Supreme Court’s decision in that case. See Spaulding v State, 481 P2d 389 (Alas, 1971); In re Dabney, 71 Cal 2d 1; 76 Cal Rptr 636; 452 P2d 924 (1969); Johnson v State, 9 Md App 166; 263 A2d 232 (1970); State v Koch, 118 NJ Super 421; 288 A2d 295 (1972); rule modified and extended in light of Loper, 119 NJ Super 184; 290 A2d 738 (1972).
Following Loper, several other state courts have either applied Loper or recognized its applicability. Fee v State, — Tenn —; 497 SW2d 748, 750 (1973); Commonwealth v Barrett, 296 NE2d 712 (Mass App, 1973); Wood v State, 478 SW2d 513 (Tex Crim App, 1972).
This ruling does not preclude Moore, in further proceedings at the trial court level, from attacking the validity of his 1958 narcotics conviction. If he can establish its constitutional infirmness, then our analysis of the Loper issue should be reconsidered by the trial court.
When Moore was sentenced in this case the judge adverted to his earlier convictions saying: "[Yjou’ve had prison of 1-1/2 to 15, 1-1/2 to 5, 6 to 10, and one by Judge Newblatt in 1967 of 8 to 10, which however he set aside this year.”
The 1-1/2 to 15 year sentence was imposed for Moore’s 1949 breaking and entering conviction.
The only reasonable inference from the foregoing is that the judge did consider Moore’s uncounseled 1949 conviction when sentencing him in this case.
Gavin is based on Brown v United States, 483 F2d 116, 119 (CA 4, 1973), where the Court declared that it would require "a prisoner who bases his [Tucker] attack against one sentence on a collateral attack on another state sentence, particularly, when imposed in a foreign jurisdiction, to attack first the underlying sentence in the court imposing that sentence.”
There is, however, no problem of Federal-state relations where the prior convictions were in Michigan.
Moore’s previous convictions were both Michigan convictions. | [
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Per Curiam.
The Court of Appeals, relying on its holding in Dues v Universal Underwriters Insurance Co, 41 Mich App 631; 200 NW2d 487 (1972), held that a written rejection of uninsured motorist coverage in an application for an automobile liability or motor vehicle liability policy complies with the requirements of MCLA 500.3010; MSA 24.13010 and that this statute does not require that the rejection be made at a time after the insurer has delivered to the insured a policy which contains uninsured motorist coverage.
This statute provides that no automobile liability or motor vehicle policy insuring against loss resulting from liability imposed by law for bodily injury or death arising out of the ownership, maintenance or use of a motor vehicle shall be issued or delivered without uninsured motorist coverage "unless the named insured rejects such coverage in writing as provided herein. All such policies shall contain a notice * * * that such protection coverage was explained to him and that he can reject such coverage by notice in writing.”
In the present case, the rejection was not in the policy but, rather, in an application for the policy, as follows:
"I, the undersigned, understand that I am entitled, for $15.00 in additional premium payable to the Balboa Insurance Company, to have this policy contain an 'uninsured motorist endorsement’ with limits of $10,-000/$20,000 insuring the persons insured hereunder, their heirs or legal representatives, for all sums within such limits which he or they as the case may be shall be legally entitled to recover as damages for bodily injury or wrongful death from the owner or operator of an uninsured motor vehicle. In that I do not desire 'uninsured motorist coverage’, as described above, however, I hereby expressly waive, as permitted by the provisions of the Michigan Insurance Code the require ment that this policy contain said uninsured motorist provision, and I request the Balboa Insurance Company to issue its policy of liability insurance to me with the express understanding that uninsured motorist coverage is to be deleted therefrom both as to the named insured and as to any other person otherwise qualifying for coverage thereunder.
Applicant’s Signature_Lindell D. Smith (sgd.)
Applicant’s Signature_Lindell D. Smith (sgd.)
NOTE: If Uninsured Motorist Coverage is NOT to be included the Applicant must sign both places or the application will not be accepted. Policy is subject to a non refundable minimum premium charge of $20.00.”
In Blakeslee v Farm Bureau Mutual Insurance Co of Michigan, 388 Mich 464, 473; 201 NW2d 786 (1972), this Court paraphrased the statute and commented as follows:
"It unequivocally requires that '[n]o * * * policy * * * be delivered * * * unless coverage is provided therein’. Stated in the affirmative, every policy must have this coverage. Only after the mandatory offer is made can the insured reject it in writing.” (Emphasis by the Court.)
The issue presented and considered in Blakeslee, supra, did not concern the manner in which the offer of uninsured motorist coverage was to be made or the manner in which it could be rejected by the insured. This Court there stated only that every policy must have this coverage unless "after the mandatory offer” the insured rejects it. Blakeslee did not decide the present question of whether the offer could be made and rejected in the application before the policy was issued.
We agree with the Court of Appeals that the correct construction of the statute is that the offer of uninsured motorist coverage and its rejection by the insured may be in an application for the issuance of such a policy as was done in this case.
We grant leave to appeal and sua sponte enter a final decision affirming the judgment of the Court of Appeals in this case.
T. M. Kavanagh, C. J., and T. G. Kavanagh, Swainson, Williams, Levin, M. S. Coleman, and J. W. Fitzgerald, JJ., concurred. | [
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Williams, J.
This air pollution class action case raises three questions:
(1) Does the judicial "good cause” prerequisite for GCR 1963, 310 discovery require that the objects sought to be discovered be admissible in evidence?
(2) Is a trial judge within his discretion in requiring such admissibility as a predicate to allowing discovery?
(3) Do public policy considerations compel barring discovery of pollution control studies commis sioned by industries because fear of such disclosure might discourage voluntary anti-pollution studies and programs by industry?
We answer all three questions in the negative.
I —FACTS
On July 31, 1970, plaintiffs brought a nuisance action in Wayne County Circuit Court seeking injunctive relief and damages arising out of defendant’s Leland Plant’s alleged air and noise pollution and presentation of a fire hazard. Plaintiffs live directly across the street from the Leland Plant and claim to represent additionally a similar class of neighboring property-owners. The Leland Plant is involved primarily in the manufacture of automotive seating, cushioning, and padding in the City of Detroit.
On July 2, 1971, plaintiffs filed a motion for production of documents under GCR 1963, 310 seeking discovery of certain letters, reports, and other documents prepared prior to this litigation in 1968, 1969, and 1970 by expert consultants employed by defendant to study the Leland Plant’s emission control situation. Plaintiffs learned of the existence of these documents through interrogatories answered by defendant on June 8, 1971.
After submission of briefs and presentation of oral argument, the trial court denied the motion for production of documents by interlocutory order in a lengthy opinion handed down from the bench September 2, 1971, and in its order of September 24, 1971. The court based its denial primarily upon the fact that the requested documents would not be admissible in evidence. The trial court further observed:
"It would appear in the instant matter, however, that Defendants do not intend to use at trial, either the reports sought by Plaintiffs or the testimony of those who prepared the reports. The effect of allowing discovery in this instance would be to assist Plaintiffs in building their claims as opposed to permitting litigants to adequately prepare for testimony to be given at ¿trial.”
Secondarily, the court held that discovery in this case was not within the public interest for it would tend, as defendant urged, to discourage pollution control programs necessitating the documentation of evidence which could later be used against the entity which solicited the reports.
The Court of Appeals affirmed the trial court 2-1 on November 28, 1972. 43 Mich App 726; 204 NW2d 726 (1972). The two-judge majority, in a brief five-paragraph opinion, resolved this case entirely on the issue of trial court discretion. Finding no abuse of that discretion, the majority affirmed. Judge V. J. Brennan dissented in an opinion which we essentially follow today.
This Court granted leave to appeal on April 30, 1973. 389 Mich 788 (1973).
II —IS EVIDENTIARY ADMISSIBILITY PREREQUISITE TO GCR 1963, 310 DISCOVERY?
It should first be noted that Michigan has a strong historical commitment to a far-reaching, open and effective discovery practice. In light of that commitment, this Court has repeatedly emphasized that discovery rules are to be liberally construed in order to further the ends of justice. Hallett v Michigan Consolidated Gas Co, 298 Mich 582, 586; 299 NW 723 (1941); Scarney v Clarke, 276 Mich 295, 303; 267 NW 841 (1936); Vincent v VanBlooys, 263 Mich 312, 314-315; 248 NW 633 (1933).
The portion of Rule 310 relevant to the instant appeal reads as follows:
"Rule 310. Discovery and Production of Documents and Things for Inspection, Copying, or Photographing
".1 Power of the Court. After commencement of an action the judge of the court in which the action is pending may, upon motion of any party and upon notice to all other parties, and subject to the provisions of subrule 306.2:
"(1) order any party to produce and permit the inspection and copying or photographing, by or on behalf of the moving party, of any reasonably designated documents, papers, books, accounts, letters, photographs, objects, or tangible things, not privileged, relevant to the subject matter involved in the pending action and which are in his possession, custody, or control; * * * ”
The relevant portion of Rule 306.2 reads as follows:
"The court shall not order the production or inspection of any writing prepared by the adverse party, his attorney, surety, indemnitor, or agent in anticipation of litigation or in preparation for trial unless satisfied that denial or production or inspection will unfairly prejudice the party seeking the production or inspection in preparing his claim or defense or will cause him undue hardship or injustice, except as provided in sub-rule 310.1(4). The court shall not order the production or inspection of any part of the writing that reflects an attorney’s mental impressions, conclusions, opinions, or legal theories.”
Rule 310 literally appears to give plaintiffs an unlimited discovery right to relevant, non-privileged documents subject only to the protective provisions of Rule 306.2 and trial court discretion. But Rule 310 has been subject to significant judicial construction. In light of the mandate for a liberal construction in order to further the ends of justice, this Court has clarified the import of Rule 310 noting the necessity for a showing of "good cause” by the moving party before such party is entitled to put the issue of document production to the trial court for exercise of its discretion. Covington Mutual Insurance Co v Copeland, 382 Mich 109, 111-112; 168 NW2d 220 (1969); J A Utley Co v Saginaw Circuit Judge, 372 Mich 367, 375; 126 NW2d 696 (1964).
In the instant case, the trial judge correctly imposed this "good cause” showing requirement upon the moving party, but, significantly, the court held additionally that "requisite 'good cause’ is good cause in relation to answering or countering evidence or testimony to be used at trial”. While it could have been interpreted more broadly, the quoted language became the troublesome fly in this discovery ointment, because the trial court proceeded to interpret this language to impose an evidentiary admissibility requirement upon plaintiffs moving under Rule 310.
But "good cause” under Rule 310 is clearly no longer governed by considerations of admissibility. On June 7, 1965, Rule 310.1(1) was amended, effective immediately, to explicitly eliminate, inter alia, the limitation on production of documents to those documents which, by reference to GCR 1963, 302.2, were "admissible under the rules of evidence”. See 2 Honigman & Hawkins, Authors’ Comment 4 to GCR 1963, 310. The trial judge in the instant case erroneously reimposed this deleted admissibility requirement. To accept such a conclusion would do great damage to the settled Michigan policy of encouraging full and open dis covery in order to narrow the range of disputed issues which might otherwise needlessly waste the parties’ and judicial resources.
Ill —GOOD CAUSE FOR GCR 1963, 310 DISCOVERY
While we have elucidated what Rule 310 does not require with respect to a showing of "good cause”, the issue of what is required is more difficult. The question of the meaning of "good cause” in the Federal context, prior to elimination of that standard in 1970, was a subject of vigorous discussion and debate. 3****Without inserting ourselves into that now-mooted controversy at the Federal level, we do note with approval the analysis of one Federal court on this subject. In Franks v National Dairy Products Corp, 41 FRD 234 (WD Texas, 1966), a similar issue was before the court under Federal Rule 34, the Federal counterpart to Rule 310, when it had a "good cause” requirement. Judge Fisher, after a scholarly review of the competing authority, held:
"[T]he requirement of Rule 34 that 'good cause’ must be shown is satisfied when the moving party demonstrates that the information sought is or might lead to admissible evidence, is material to the moving party’s trial preparation, or is for some other reason necessary to promote the ends of justice.” 41 FRD 234, 238. (Emphasis added.)
This standard, we believe, is both just and squarely in line with the judicial rationale behind imposition of a "good cause” requirement. It provides for extensive discovery in those actions where discovery presents the reasonable likelihood of providing the moving party with relevant and appropriate information. Thus we consider that the Franks standard quoted above is well-reasoned and we adopt it as an accurate statement of the meaning of "good cause” under Rule 310.
On this basis, we must look to the plaintiffs’ showing in the instant case to determine whether or not they did in fact present the court with "good cause” sufficient to move that court to grant discovery.
Plaintiffs’ motion for production of documents gives a two-sentence rationale supportive of good cause:
"Such documents relate directly to the subject matter of the instant litigation since plaintiffs allege injuries resulting from defendant’s air pollution. Said documents contain relevant material evidence which may be utilized in whole or in part by defendant at the trial of this case.”
These succinct allegations in plaintiff’s motion well illustrate the apparent confusion which heretofore surrounded the "good cause” showing requirement. Indeed, at first blush, one might well have interpreted the last sentence of plaintiffs’ allegation, read in conjunction with the first sentence, as implying that plaintiffs were seeking document discovery in order to obtain evidence to be introduced at trial.
But the opinion of the trial court demonstrates that plaintiffs’ arguments at the hearing on their motion clearly alleged the materiality of these documents to plaintiffs’ trial preparation. As the court capsulized plaintiffs’ arguments:
"Plaintiffs seek production of certain studies and other documents prepared by Defendant’s Air Pollution Control Consultants in order for Plaintiffs to prepare their case for trial, particularly in proving injury to Plaintiffs by defendant’s alleged pollution, and for the necessary information to ascertain the class of Plaintiffs injured by the alleged nuisance. Plaintiffs further claim that the documents prepared were not prepared in connection with the instant litigation, present an analysis of the magnitude of the problem, the consequence of continuing the [sic] maintain the alleged nuisance, and the alternatives to solve the problem, if any.” (Emphasis added.)
Plaintiffs’ allegations from the foregoing are therefore clearly within the Franks rule which we have adopted.
If plaintiffs can factually support (or have factually supported) these allegations of the materiality of these documents for trial preparation they can establish (or have established) good cause entitling them to discovery. The trial court was in error in denying document discovery on the basis of lack of evidentiary admissibility.
IV —THE PUBLIC POLICY ISSUE
A. The "Deterrence” Argument
Plaintiffs also contended below that the public policy in favor of broad, effective discovery practice and the public policy in favor of private litigation aimed at obtaining environmental relief arising out of the Environmental Protection Act of 1970, MCLA 691.1201 et seq.; MSA 14.528(201) et seq., give further strength to their "good cause” arguments under Rule 310.
But, conversely, defendant argued and the trial court agreed that competing considerations of public policy gave rise to the opposite conclusion that discovery in these circumstances should be barred. The trial court held:
"If discovery of such investigation conducted, not in preparation or contemplation of litigation, is permitted, despite Plaintiffs’ protestations to the contrary, it is not likely that private resources will undertake programs aimed at ameliorating pollutant conditions; for to do so, they would have to document evidence that might be used against them during litigation. In effect, they would be preparing a Plaintiffs’ case against themselves which could actually be used to oppose their own defense, should indeed litigation arise out of the matter.
"To permit such documents, prepared not for trial, but rather to assist private resources to resolve pollution problems would be to discourage efforts to resolve such problems. Such a result would not be in the public’s interest.”
We concur in the able analysis of Judge V. J. Brennan siding with plaintiffs in dissenting on this issue in the Court of Appeals:
"Finally, the court advanced a public policy reason for the denial of discovery. The court below felt that permitting discovery in this instance would discourage voluntary anti-pollution studies and programs on the part of industry. The discouragement would stem from the polluter’s knowledge that such a study could be discovered and used to facilitate a cause of action for damages against him. Again, I cannot endorse the reasoning of the trial court. A manufacturer whose operations pollute the environment would, if discovery were allowed in this situation, face two alternatives. On the one hand he could choose to do nothing regarding the undesirable side effects of his operation, and expose himself to continued and protracted litigation. On the other hand he could attempt to ameliorate and hopefully eliminate those side effects and eventually end litigation of this nature. In my opinion, the latter alternative is obviously superior even though it would admittedly have the short term side effect of facilitating a plaintiff’s task in litigation of this nature.” 43 Mich App 726, 733.
Judge V. J. Brennan has thus skillfully grasped the nettle of this difficult and thorny conflict of strong competing policy arguments and has resolved the issue in a pithy but well-reasoned and practical manner. One might only add in answer to defendant’s argument that the best policy is voluntary industry pollution abatement, that, while such policy might be "ideal”, the Legislature in enacting the Environmental Protection Act has made a realistic policy decision that the stimulus of possible litigation is now practically necessary to expedite what the ideal of laissez-faire has been too slow in accomplishing.
B. The "Subsequent Repairs” Argument
Defendant contends that the doctrine of inadmissibility of subsequent repairs bars discovery of these reports. Defendant cites for this proposition the Michigan cases of Moon v Pere Marquette R Co, 143 Mich 125; 106 NW 715 (1906); LaDue v Lebanon Twp, 222 Mich 301; 192 NW 636 (1923); Thirlby v Mandeloff, 352 Mich 501; 90 NW2d 476 (1958); and People v Gill, 247 Mich 479; 226 NW 214 (1929).
Thirlby and Gill are entirely inapposite to the instant case in that they involve admission into evidence of settlement offers. 352 Mich 501, 505; 247 Mich 479, 480. Such offers arise in the course of litigation. Expert reports prepared in the course of litigation are excluded from Rule 310 discovery by virtue of the Rule 306.2 prohibition.
Moon is a case involving admission of a change of safety rules after an accident; LaDue involves subsequent repairs. In. both cases, evidence was found inadmissible at trial because of the danger of unfairly influencing the jury. 143 Mich 125, 127-128; 222 Mich 301, 305-306. The issue of trial admissibility is not before us. We are concerned only with the issue of whether these documents are suitable for discovery purposes, not whether they can be placed in evidence before a judge or jury. While we do not express an opinion on the continued viability of the subsequent repairs evi dentiary exclusion doctrine, we hold that it is not applicable to the instant discovery application.
C. Summary
Again, we strongly reaffirm our clear public policy favoring a broad and effective pretrial discovery. All of the preceding policy and legal arguments must be viewed in light of that overriding concern.
Thus, we hold that the trial court was in error in barring discovery in the instant case on the basis of defendant’s policy argument. There is neither legal nor policy ground supporting denial of document discovery on that basis.
V —THE ISSUE OF DISCRETION
Defendant contends that whether or not the trial judge erred in refusing production of these documents is not dispositive of this appeal as the matter is one of trial court discretion and plaintiffs here have not demonstrated abuse of that discretion. As the standard for such abuse, defendants and the Court of Appeals majority below cite the following passage from Spalding v Spalding, 355 Mich 382, 384-385; 94 NW2d 810 (1959), a child support case:
"The term discretion itself involves the idea of choice, of an exercise of the will, of a determination made between competing considerations. In order to have an 'abuse’ in reaching such determination, the result must be so palpably and grossly violative of fact and logic that it evidences not the exercise of will but perversity of will, not the exercise of judgment but defiance thereof, not the exercise of reason but rather of passion or bias.”
The Spalding abuse of discretion standard relative to decision on the facts is not appropriate for use in all situations. People v Charles O. Williams, 386 Mich 565, 573; 194 NW2d 337 (1972). In Spalding the Court was using its judgment concerning the particular facts of record to enable it to make an appropriate discretionary ruling as to child support. The trial court in the instant case had discretion under Rule 310 to determine whether the facts placed before it were sufficient under the law to entitle plaintiffs to the benefit of Rule 310.
But more to the point, such standard of discretion relates to judgment on the facts not on the law, where appellate courts must exercise their judgment. Again, as judge V. J. Brennan succinctly observed in the Court of Appeals:
"By adopting the Spalding standard and applying it to this case, the majority has ignored the trial court’s rationale for denying plaintiffs’ motion for discovery. After reviewing that rationale I find that I disagree with the trial court’s 'judicial opinion’, but not with any of the trial court’s conclusions regarding the facts of the case.” 43 Mich App 726, 730.
It is obvious that the trial court ruling in the instant case was not based upon discretionary consideration of the facts but was based instead upon a misinterpretation of the applicable law. The legal question as to the standard for "good cause” is not subject to the discretionary predilections of individual judges. Such a holding would demolish entirely the appellate system of review insulating errors of law from just and appropriate scrutiny on appeal. Thus, the legal errors in the instant case present solid grounds for reversal.
VI —CONCLUSIONS
For the reasons advanced in Sections II, III, IV and V of this opinion, supra, we hold that admissibility as evidence is not a factor to be considered by the trial court in exercising its discretion whether or not to grant GCR 1963, 310 document discovery, we adopt the rule in Franks which inter alia holds "good cause” exists where "the information sought * * * is material to the moving party's trial preparation”, we hold further that defendant’s policy argument, outlined supra in Section V, is not a bar to discovery, and we hold finally that the trial court’s refusal to grant production of the documents was based on an error of law and thus was not a matter within the purview of judicial discretion.
The trial court order of September 24, 1971, denying production of these documents was erroneous and is hereby set aside. The trial court and Court of Appeals are reversed and the cause is remanded to Wayne County Circuit Court for pro ceedings not inconsistent with this opinion. Costs to plaintiffs-appellants.
T. M. Kavanagh, C. J., and T. G. Kavanagh and Levin, JJ., concurred with Williams, J.
"Good cause” is a common requirement prior to document production in other jurisdictions. See Annotation: Discovery — Statements of Witnesses, 73 ALR2d 12, § 35.
See Federal Rules Digest (3d ed), § 34b.221; 4A Moore’s Federal Practice (2d ed), § 34.08.
For a good review of the history behind FRCP 34 and the reasons for the elimination of the "good cause” requirement in Federal practice where the moving party need not make his or her discovery request in court in the first instance, see 8 Wright & Miller, Federal Practice & Procedure, § 2201.
Once "good cause” has been shown by the moving party, trial court discretion to bar discovery is not entirely unfettered. This precise point was discussed by Justice (then Judge) J. W. Fitzgerald in Pearson v VanderWier, 3 Mich App 41; 414 NW2d 685 (1965). In Pearson, plaintiffs sought Rule 310 discovery of a statement made by defendant’s insurer following an automobile accident. Justice Fitzgerald held:
"Once the 'good cause’ requirement of Utley has been satisfied, we feel that the trial court in the instant case had little latitude but to order the production of * * * [defendant’s agent’s] statement. Nonproduction of the statement is the gravamen of this appeal and left too many imponderables in this case * * * . While a motion filed with the court should not necessarily precipitate an order, we feel that the failure to supply a copy of the statement plus the clear issue of the credibility of * * * [defendant’s agent], who was not a casual bystander, but rather the driver of the other vehicle, furnished sufficient grounds to require the trial court to order production of the statement.” 3 Mich App 41, 49-50. (Emphasis added.)
See also on this point Willard v Gaston, 333 Mich 455, 461; 53 NW2d 332 (1952).
Plaintiffs also advanced a third "good cause” argument below, namely that they are indigent and lack the necessary resources to commission such studies. The trial court ruled:
"This Court is, however, concerned about the allegation of Plaintiffs that Plaintiffs are indigent and are unable to afford the type of investigation required to make such a determination [of the type and amount of pollutants]. We are, however, not persuaded at this point that the Defendant is a proper person to, in effect, provide the funding necessary to encourage litigation against itself.”
We do not discuss this issue in depth as the discussion in Section IV of this opinion demonstrates that defendant’s policy argument, as repeated in this context, must fall. It should be noted though that we are talking about actual data accumulated in 1968-1970. It is difficult to surmise how the plaintiffs could reproduce such data regardless of expense.
"The EPA is a small but significant affirmation of confidence in the citizen.” Sax and Conner, Michigan’s Environmental Protection Act of 1970: A Progress Report, 70 Mich L Rev 1004, 1081 (1972). Coauthor Joseph L Sax was draftsman of EPA.
It should be noted in any case that the subsequent repairs doctrine has been held in many jurisdictions not to be unlimited. For a list of various exceptions carved into the general rule, see McCormick, Law of Evidence, § 252.
Note in this context the reasoning of Justice (then Judge) Levin in Roe v Cherry-Burrell Corp, 28 Mich App 42; 184 NW2d 350 (1970), a deposition discovery case where defendant attempted to depose the opposite party’s expert witness. On rehearing, the point was made with respect to deposition discovery (GCR 1963, 302.1) that, in light of the aim of complete disclosure:
"There is not need to leave the resolution of the question before us to the murky area of trial judge discretion. Only those questions for which it is not possible to devise a rule of law generally applicable are properly left to unregulated discretion. If a rule can be stated, one way or another, then the choice should be responsibly made and the decision should be uniformly implemented — the question should no longer depend on the personal predilections of the sitting judge.” (Footnote omitted.) 28 Mich App 42, 53. | [
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Williams, J.
While important, the issue in this case is a relatively narrow one.
Michigan already permits a buyer of property who has relied on a faulty abstract to his detriment to recover from the abstracter, even though there is no clear contractual privity between them, if the abstracter in fact knew the buyer would rely on the abstract.
This case presents the issue whether a faulty abstracter should likewise be liable to a buyer he should have foreseen would rely on the abstract as well as to the buyer he knew would rely on it. The question boils down to whether there should be liability for foreseeable as well as known reliance.
This Court has answered that question affirmatively in a related fact situation, and in categorical terms relieved Michigan jurisprudence of the re strictions of "privity”. In this opinion, we reaffirm our general decision eliminating privity and specifically apply it to abstracters.
There is a second issue in this case. When does liability accrue and what statute of limitations applies?
I —FACTS
Plaintiffs Williams purchased certain property situated in the City of Warren, Macomb County, from defendant Polgar on a land contract dated August 1, 1959. At the time of purchase, as provided in the land contract, defendants furnished to plaintiffs an abstract of title certified to July 15, 1959 by Abstract and Title Guaranty Company. This abstract was originally issued on February 4, 1926 by the Macomb County Abstract Company and was extended by said company in 1936, 1937, 1943, 1944, 1945, 1946, 1948, 1951, and 1952. Defendant American Title Insurance Company is the successor in interest to Macomb County Abstract Company.
The abstract of title failed to include a deed dated May 1, 1926 which was recorded on May 24, 1926 in Liber 242 of Deeds at page 174 of Macomb County records. This deed conveyed the southerly 60 feet of the property in question to the Macomb County Board of Road Commissioners.
After execution of the land contract on August 1, 1959, plaintiffs learned, allegedly for the first time, of the existence of this omitted deed. As the result thereof, plaintiffs claim they were required to completely remove a building and that certain other damages were incurred.
Plaintiffs filed this action on April 21, 1971. All defendants filed motions for accelerated judgment based on the statute of limitations. The trial court held that plaintiffs’ cause of action accrued no later than the execution of the land contract on August 1, 1959. Thus accelerated judgment was granted defendants. Plaintiffs were non-suited. The Court of Appeals reversed and remanded. 43 Mich App 95; 204 NW2d 57 (1972). Defendant American Title Insurance Company requested leave to appeal to this Court which was granted on December 12, 1972. 388 Mich 812 (1972).
II —EFFECT OF ACCELERATED JUDGMENT
Under a motion for accelerated judgment by defendants the facts well pleaded by plaintiffs and the reasonable inferences therefrom must be considered most favorably towards plaintiffs. As the complaint adequately alleges the title company’s negligent misrepresentation in the abstract, plaintiffs’ reliance thereon and the damage caused thereby as well as the other matters appearing in the above statement of facts, this case presents at this point no dispute as to facts.
Where there is a person negligently injured by another, normally there is recovery therefor. Ubi injuria, ibi remedium.
Defendant title company here, however, seeks immunity from liability for the injury it caused plaintiff buyers, pleading two defenses. First, defendant pleads it is immune from suit because it is not in contractual privity with plaintiffs. Second, defendant pleads it is immune from suit because of the statute of limitations. We disagree.
Ill —DEFENSE OF PRIVITY
A. Cessante Ratione Legis, Cessat et Ipsa Lex
The early common-law rule restricting liability to those in contractual privity with an abstracter was based on a system where abstracts would only be used by real estate owners. 1 Fitch, Abstracts and Titles to Real Property, § 9, p 9; and see § 3. As time went on the actual usage of abstracts and the class of people relying on them expanded. This historical change in circumstance and the corresponding change in law is noted in numerous cases of which the following two quotations will serve as examples. The first, Brown v Sims, 22 Ind App 317, 325; 53 NE 779; 72 Am St Rep 308 (1899) illustrates a judicial expansion of liability to a known third-party beneficiary:
"It is very well known that the owner of real estate seldom incurs the expense of procuring an abstract of the title from an abstracter, except for the purpose of thereby furnishing information to some third person or persons who are to be influenced by the information thus provided. If the abstracter in all cases be responsible only to the person under whose employment he performs the service, it is manifest that the loss occasioned thereby must in many cases, if not in most cases, be remediless.”
The second, Gate City Abstract Co v Post, 55 Neb 742, 746; 76 NW 471 (1898), represents judi cial support of legislation that purports to create liability "for the payment by such abstracters of any or all damages that may accrue to any party or parties, by reason of any error, deficiency or mistake in any abstract”:
"By the common law, as we interpret it, the owner of real estate could only utilize an abstract as an argument to reinforce his own assertions concerning the state of his title. It might be persuasive, but was without legal efficacy. He may now use it as evidence in an action to enforce the specific performance of a contract of sale, and in every other form of action in which the validity of his title or the existence or non-existence of liens or incumbrances are questions directly or collaterally involved. The right to use an abstract as evidence is not even limited to the person to whom it is issued. Any one may use it, and any one against whom it is employed may be injured in consequence of the certificate being false. Having thus widened the abstract’s sphere of action, it was quite natural that the legislature should also widen the abstracter’s liability.”
Responding to the actual change in use of abstracts and the additional classes of persons relying on them, at least six general court-created exceptions have been grafted onto the supposed common-law requirement of strict contractual privity. These exceptions include:
(1) abstracter’s fraud or collusion,
(2) theory of third-party beneficiary contracts,
(3) theory of foreseeability of use by a third-party,
(4) actual knowledge or notice of third-party,
(5) agent for disclosed or undisclosed principal contracting with an abstracter, and
(6) reissuance or recertification of an abstract.
See Liability of Abstracter-Privity, 34 ALR3d 1122, 1131, for cases supportive of each of these exceptions. See also 12 Vand LR 783 (1959).
Whereas the common-law rule limiting abstracter liability provided immunity from all who were injured by a faulty abstract except those in actual contractual privity, of the 35 jurisdictions (outside of Michigan) addressing themselves to this matter only seven retain a rule of strict contractual privity: Arizona, California, Florida, Illinois, Ohio, Texas and Wisconsin. On the other hand, 11 extend liability to known third-parties relying thereon: Alabama, District of Columbia, Hawaii, Idaho, Indiana, Maryland, Missouri, New Jersey, New York, Pennsylvania and Tennessee. Two jurisdictions have allowed recovery by undiscovered principals: Iowa and Washington. Fourteen purport to extend liability by statute to "any person” relying on the abstract: Arkansas, Colorado, Kansas, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Utah and Wyoming. And one jurisdiction extends liability to foreseeable relying third-parties by court decision: Louisiana.
B. Michigan Has Abolished Privity Requirement
Michigan ended the last century and began this one firmly wed to the rule of contractual privity immunizing abstracters. Smith v Holmes, 54 Mich 104; 19 NW 767 (1884); Kenyon v Charlevoix Improvement Co, 135 Mich 103; 97 NW 407 (1903). By the end of the second decade it reluctantly broke away from strict privity in favor of a known third-party beneficiary. Beckovsky v Burton Abstract & Title Co, 208 Mich 224; 175 NW 235 (1919). Michigan thereby joined a category of 11 other jurisdictions just noted who had opened recovery to parties the abstracter knew would rely on the abstract. In Beckovsky, the plaintiff buyer actually accompanied the seller to the office of defendant title company and said he wanted an abstract but the contract in all truth was between the seller and the title company with the seller paying the title company for its work, although in order to avoid the title company’s defense of privity, the trial court graciously put that question to the jury.
So Beckovsky extends liability to the faulty abstracter who knows a third-party beneficiary will rely on its abstract. The question remains, will liability likewise apply to the faulty abstracter who can reasonably foresee reliance by a third-party.
Michigan answered this question affirmatively in 1958 and categorically eliminated the requirement of privity. Spence v Three Rivers Builders & Masonry Supply, Inc, 353 Mich 120; 90 NW2d 873 (1958). This was done in a products liability case where a plaintiff not in privity with a defendant building supply company purchased cinder-block building materials through a third-party building contractor. The supplies subsequently proved faulty to plaintiffs damage, just as the abstract did in the instant case. Defendant in that case, like the defendant in the instant case, relied on privity to bar plaintiffs action.
Justice Voelker, speaking for this Court, recognized that privity was more honored by exceptions than by the rule. However, this Court decried continued evasion of the rule and faced the issue squarely, holding that privity was an unnecessary bar to recovery. Justice Voelker spoke forthrightly to the point as follows:
"We now proceed to face up to the big issue in this case: Should lack of privity bar this action as a matter of law?
"As the court below correctly observed, there is little doubt that in the past our court has for the most part devotedly followed the 'general rule’ and been reluctant to permit a third person 'not in privity’ to recover from a manufacturer on a theory of negligence or implied warranty.
"Saddled with such a doctrine and its hair-splitting exceptions, it is not surprising that while a few of our decisions have afforded passing illusory comfort to all, certainty has been afforded to none. The reason is simple: A court lacking a clear and understandable rule of its own can scarcely be expected to impart it to others. Legal confusion has inevitably resulted. Aggrieved plaintiffs have scarcely known whether to sue in deceit or fraud or for negligence or for breach of warranty — or indeed whether it was worthwhile to sue at all.
"Our court perhaps uttered the towering legal understatement of the year (1924) when in Hertzler v Manshum, 228 Mich 416 [200 NW 155] (a poison flour case), we observed that cases in this category 'appear hopelessly at variance.’ We there reverently discussed the accepted theory of claimed nonliability (our old friend, lack of privity) and then proceeded to hold that food cases were an exception (pp 421, 422) 'and there only by reason of a want of a high degree of care.’ While that case is not alone, it is typical of the curious things courts can bring themselves to do and say when they try vainly to wed the outmoded thinking and legal cliches of the past to the pressing realities of modern life.
"Consider what was just said in Hertzler. 'Higher care’ was there our way around privity. This is a beguiling notion, but we find ourselves unable to discover why the imposition by judicial fiat of a mystical higher degree of care should magically dissolve the need for privity, as just asserted in Hertzler. Why should this be so? Either lack of privity should always be a defense in these cases or it never should be.
"In this case it appears that there was a lack of due care. Merely to describe what happened to the blocks should be showing enough on that score — but here the defendant admitted that he had inspected or tested neither the ráw materials nor the finished blocks. Granting the learned trial court’s understandable bewilderment under our past decisions, we think it should have permitted recovery either on a theory of negligence or implied warranty and should also have proceeded to take such further proofs on plaintiff’s dam ages as may have been necessary.” 353 Mich 121, 126, 128-129, 135.
C. Privity Conclusion
Michigan’s own jurisprudence records the categorical elimination of privity. This Court had previously extended abstracter liability consonant with the historical growth in reliance and use of abstracts and the corresponding changes in the law to known relying third-parties. Confronted now as of first impression with the question of abstracter liability to foreseeable relying third-parties, we have but to apply our own persuasive precedent of categorical elimination of privity to an analogous situation, and we do so.
IV —ABSTRACTER LIABILITY IN TORT FOR NEGLIGENT MISREPRESENTATION
On the basis of Three Rivers and a plethora of jurisdictions in the United States a good case is made for abolishing contractual privity and permitting suit in "negligence or implied warranty” by any foreseeable third-party who would and does rely on the abstract. We consider now the matter of suit in "negligence”.
In Clark v Dalman, 379 Mich 251; 150 NW2d 755 (1967), for example, it was held that breach of a contract to repair, clean, and paint a water storage tank, also gave rise to an action in tort in favor of a non-contracting third-party. Chief Justice (then Justice) T. M. Kavanagh explained this relationship óf a tort action to the underlying contract:
"Actionable negligence presupposes the existence of a legal relationship between parties by which the injured party is owed a duty by the other, and such duty must be imposed by law. * * * Such duty of care may be a specific duty owing to the plaintiff by the defendant, or it may be a general one owed by the defendant to the public; of which the plaintiff is a part. Moreover, while this duty of care, as an essential element of actionable negligence, arises by operation of law, it may and frequently does arise out of a contractual relationship, the theory being that accompanying every contract is a common-law duty to perform with ordinary care the thing agreed to be done, and that a negligent performance constitutes a tort as well as a breach of contract. But it must be kept in mind that the contract creates only the relation out of which arises the common-law duty to exercise ordinary care. Thus in legal contemplation the contract merely creates the state of things which furnishes the occasion of the tort. This being so, the existence of á contract is ordinarily a relevant factor, competent to be alleged and proved in a negligence action to the extent of showing the relationship of the parties and the nature and extent of the common-law duty on which the tort is based.” (Emphasis added.) 379 Mich 251, 260-261.
This Court recently reaffirmed these principles, citing Clark, in Nash v Sears, Roebuck & Co, 383 Mich 136, 143; 174 NW2d 818 (1970). See also Nicholson v Han, 12 Mich App 35, 43; 162 NW2d 313 (1968), and Talucci v Archambault, 20 Mich App 153, 161; 173 NW2d 740 (1969).
With respect to the particular type of tort action arising from breach of an abstracter’s contractual duty, we hold it to be an action in negligent misrepresentation. Numerous cases and law review articles have debated the precise tort cause of action most appropriate in this context. The theories of fraud, deceit, warranty, and strict liability have all been the subject of extensive discussion with respect to professional misrepresentations of this sort. None of these theories has been found to adequately deal with this particular problem; negligent misrepresentation, on the other hand, precisely fits this situation.
The obvious difficulty with a fraud or deceit action is the requisite element of scienter. The issue we are dealing with in the instant case does not, on the pleadings, involve intentional misrepresentation. To supply the element of intent constructively is to do great violence to existing law on the subject of fraud. Note the discussion of this point by Prof. Francis Bohlen in Should Negligent Misrepresentations Be Treated As Negligence or Fraud, 18 Va LR 703, 706-707 (1932):
"In all other fields of tort law the line is sharply drawn between intentional and unintentional injury. The persistence of this distinction can only be explained by recognizing the fact that it is. in accord with the normal reactions of the mass of mankind. If negligent misrepresentation is called fraud, and, therefore, comes to be regarded by courts as tantamount thereto, there is danger that the unintentional character of the one and the intentional character of the other will be overlooked. There is danger that that liability, which is regarded both by lawyers and laymen as just where there is conscious dishonesty, will be imposed, although there is no purpose to deceive. Call any two essentially different things by the same name and the two are likely to be treated as identical for all purposes.”
Further, to treat this cause of action as sounding in warranty or strict liability might serve to extend an abstracter’s duty beyond the duty anticipated by the original contract. It is important to repeat that the tort cause of action created by an abstracter’s nonfeasance or misfeasance stems from the contractual duty originally imposed and does not render an abstracter liable for action beyond such contractually-imposed duty, i.e., to perform in a diligent and reasonably skillful workmanlike manner.
Thus, we adopt the tort action of negligent misrepresentation in this context. See 1 Harper & James, The Law of Torts, § 7.6; 17 CJS, Contracts, § 154(c). It should be noted that this action is premised on negligence in title search; an abstracter is not converted into a title insurer by virtue of our decision today. We repeat that the only liability an abstracter has to an injured third-party is with respect to negligent performance of his or her contractual duty.
As to the measure of the duty required to be exercised by the abstracter, Chief Justice T. M. Kavanagh noted in Nash v Sears, Roebuck & Co, supra, at page 142:
"Every contract of employment includes an obligation, whether express or implied, to perform in a diligent and reasonably skillful workmanlike manner.”
This is clearly a form of the traditional negligence standard. Since the legal duty which, when breached, gives rise to a tort cause of action, springs from the contractual duty imposed, this Nash standard governs an abstracter’s legal obligation to non-contracting parties. Because an abstracter is hired to determine what is in the public record, misstatements of, or failure to include, relevant items contained in that record are obviously examples of acts constituting failure to perform abstracting services in a diligent and reasonably skillful workmanlike manner.
This cause of action arising from breach of the abstracter’s contractual duty runs to those persons an abstracter could reasonably foresee as relying on the accuracy of the abstract put into motion. The particular expert-client relationship accruing to a professional contract to certify the condition of the record of title reposes a peculiar trust in an abstracter which runs not only to the original contracting party. There is a clearly foreseeable class of potential injured persons which would obviously include grantees where his or her grantor or any predecessor in title of the grantor has initiated the contract for abstracting services with the abstracter.
V —DEFENSE OF STATUTE OF LIMITATIONS
Defendants below were granted accelerated judgments on the basis of a plea of statute of limitations bar to this action. There is some textbook authority to the effect that the statute of limitations in an abstracter liability action begins to run from the date the abstract was furnished rather than from the time of the discovery of the error.
But the textbook authority referred to is predicated upon an action in contract, not an action in tort. Consider for example, part of the applicable section in American Jurisprudence:
"[T]he statute of limitations begins to run from the time of the occurrence of the breach of duty * * * .” 1 Am Jur 2d 245.
While such a breach of duty creating a cause of action in a contract action would date from the actual act of omission or misrepresentation, the cause of action in a tort action runs from the date the tort was committed, not the date the actor put his or her force wrongfully into motion. 20 Michigan Law & Practice, Statute of Limitations, § 43; 51 Am Jur 2d, Limitations of Actions, §§ 107, 109s. The single case appellants rely on as authority for their statute of limitations argument, Cushman v Avis, 28 Mich App 370; 184 NW2d 294 (1970), was a contract action not involving abstracts of title and, further, did not involve a non-contracting third-party.
More relevant to the issues presented in this case is Coury v General Motors Corp, 376 Mich 248; 137 NW2d 134 (1965). The question presented in that case was when a cause of action accrued under the wrongful death act so as to start the running of the statute of limitations. In holding that the statute began to run only upon death and not when the death-dealing force was put into motion, Justice Dethmers stated for a unanimous court:
"How could a right of action under the death act accrue at all if death never occurred in consequence of the injury or accrue before the occurrence of death?” 376 Mich 248, 250.
Similarly, how can a tort cause of action accrue prior to the occurrence of the tort? To bar such suits prior to the date of injury, would negative, in most cases, any value of having a separate tort cause of action at all. Justice T. E. Brennan made this same point for a unanimous court in Connelly v Paul Ruddy's Equipment Repair & Service Co, 388 Mich 146, 150; 200 NW2d 70 (1972), noting that running the statute of limitations from the day the tortious force was put into motion would destroy plaintiffs cause of action before it even arose. 388 Mich 146, 150. He also noted that:
"In the case of an action for damages arising out of tortious injury to a person, the cause of action accrues when all of the elements of the cause of action have occurred and can be alleged in a proper complaint.
"Those elements are four in number:
"(1) The existence of a legal duty by defendant toward plaintiff.
"(2) The breach of such duty.
"(3) A proximate causal relation between the breach of such duty and an injury to the plaintiff.
"(4) The plaintiff must have suffered damages.”
Under these standards, is there a tort cause of action accruing before plaintiff has knowledge, or should have knowledge, of the negligent misrepresentation? We think not.
General tort law principles in Michigan as discussed supra, support our determination that the statute of limitations does not begin running until the point where plaintiff knows or should have known of this negligent misrepresentation. At that point, the four elements in Connelly, supra, are satisfied: a legal duty exists, such duty is breached, a proximate causal relation is established (if plaintiff can show reliance on the abstract), and the plaintiff then is, or should be, aware of any resultant damages.
VI —CONCLUSION
For the reasons outlined above, we hold that there is a valid tort cause of action in the nature of negligent misrepresentation arising from a contract for an abstracter’s services in favor of a non-contracting damaged third-party whose reliance on the abstract could be foreseen. In a tort action of this nature, the statute of limitations begins running from the date the injured party knew or should have known of the existence of the negligent misrepresentation, a date not clearly in evidence in this case. The accelerated judgment granted by the trial court was thus improper.
The judgment of the Court of Appeals is affirmed. This case is remanded to Macomb County Circuit Court for further proceedings not inconsistent with this opinion. Costs to the appellees.
T. M. Kavanagh, C. J., and T. G. Kavanagh and Swainson, JJ., concurred with Williams, J.
APPENDIX A
CURRENT STATUS OF ABSTRACTER’S LIABILITY IN JURISDICTIONS OTHER THAN MICHIGAN
c = case law
s = statute
I — NO CASES OR STATUTES ON POINT
Alaska
Connecticut
Delaware
Georgia
Kentucky
Maine
Massachusetts
Mississippi
New Hampshire
North Carolina
Rhode Island
South Carolina
Vermont
Virginia
West Virginia
(15 Jurisdictions)
II — STRICT CONTRACTUAL PRIVITY REQUIRED
Arizona (c)
California (c)
Florida (c)
Illinois (s, c)
Ohio (c)
Texas (c)**
Wisconsin (c)
(7 Jurisdictions)
III — RECOVERY BY KNOWN THIRD-PARTIES
Alabama (c)
District of Columbia (c)
Hawaii (c)**
Idaho (s, c)**
Indiana (c)
Maryland (c)
Missouri (c)*
New Jersey (c)*
New York (c)
Pennsylvania (c)
Tennessee (c)*
(11 Jurisdictions)
IV — RECOVERY BY Iowa (c)
UNDISCLOSED Washington (c)
PRINCIPALS (2 Jurisdictions)
V — LIABILITY EXTENDED BEYOND PRIVITY TO "ANY PERSON” RELYING ON THE ABSTRACT (NOT EXPLICITLY IN TORT)
Arkansas (s)
Colorado (s)
Kansas (s, c)
Minnesota (s)*
Montana (s)
Nebraska (s, c)
Nevada (s)
New Mexico (s, c)
North Dakota (s, c)
Oklahoma (s, c)
Oregon (s)
South Dakota (s, c)
Utah (s)
Wyoming (s)
(14 Jurisdictions)
VI — TORT Louisiana (c)
LIABILITY (1 Jurisdiction)
APPENDIX B
Following is a jurisdictional analysis of abstracter’s liability in each of the 50 states and the District of Columbia.
ALABAMA
While both Abstract & Title Guaranty Co v Kigin, 21 Ala App 397; 108 So 626 (1926), and Shine v Nash Abstract & Investment Co, 217 Ala 498; 117 So 47 (1928), stand for the requirement of strict privity in their express language, there is reference in Shine to the exception created when the abstracter has notice that the abstract purchaser is acting for a third-party (217 Ala 498, 501; 117 So 47, 49).
ALASKA
Alaska appears to have no statutory or case law on this point.
ARIZONA
Arizona recognized in dicta a number of exceptions to the requisite of strict privity but decided the case on privity in Phoenix Title & Trust Co v Continental Oil Co, 43 Ariz 219; 29 P2d 1065 (1934). In Arizona Title Insurance & Trust Co v O’Malley Lumber Co, 14 Ariz App 486; 484 P2d 639 (1971), Arizona recognized the tort action of negligent misrepresentation in a business situation not involving an abstracter, but citing Restatement Torts (2d) § 552 ánd abstracter cases from other jurisdictions.
ARKANSAS
In Talpey v Wright, 61 Ark 275; 32 SW 1072 (1895), direct privity was required as a basis for suit against an abstracter though there was language supportive of extension of this cause of action to known third-parties (61 Ark 275, 282; 32 SW 1072, 1074). Adam v Greer, 114 F Supp 770 (WD Ark, 1953), continued to hold to the general rule of privity noting that the issue of tort or contract was not reached as unnecessary to the disposition of the instant case (114 F Supp 770, 775). In 1969, Ark Stats Ann 71-106 was added creating an abstracter’s bond to cover any damages sustained by "any person * * * for whom said applicant may compile, make or furnish abstracts”. No cases interpret this language.
CALIFORNIA
In Hawkins v Oakland Title Insurance & Guaranty Co, 165 Cal App 2d 116; 331 P2d 742 (1958), the tort theory of Restatement Torts (2d) § 552 was adopted but plaintiff was the abstract purchaser not a third-party. Viotti v Giomi, 230 Cal App 2d 730; 41 Cal Rptr 345 (1964), stands for the proposition that recovery is now available in contract or tort (citing Hawkins) but again, no unknown third-party was involved. Colonial Savings & Loan Association v Redwood Empire Title Co, 236 Cal App 2d 186; 46 Cal Rptr 16 (1965) unencouragingly raised the possibility of suit by a known third-party grantee.
COLORADO
Colo Rev Stats 1963 Ch 1-1-5 creates a cause of action on an abstracter’s bond for "any person” against an abstracter on account of his or her "error, deficiency, or mistake”. This statute has been in effect since 1929.
CONNECTICUT
Connecticut appears to have no statutory or case law on this point.
DELAWARE
Delaware appears to have no statutory or case law on this point.
DISTRICT OF COLUMBIA
While Long v American Savings & Loan Association, 151 A2d 770 (DC Mun Ct App, 1959) held that an abstracter’s liability action was clearly in contract not tort, Doonis v Mutual Title Co, 196 A2d 480 (DC App, 1964) went further than strict privity on its facts, extending liability to third-party grantee plaintiffs, saying that a grantee who had paid a $100 settlement charge was a co-employer, although seller had actually employed the abstracter.
FLORIDA
Florida requires strict privity to maintain an abstracter’s liability action. An unknown third-party was denied recovery in Sickler v Indian River Abstract & Guaranty Co, 142 Fla 528; 195 So 195 (1940).
GEORGIA
Georgia appears to have no statutory or case law on this point.
HAWAII
In the first and only case on point, Hawaii moved in Chun v Park, 51 Hawaii 462; 462 P2d 905 (1969) to a tort liability following the rationale of Restatement 2d Torts § 552 in favor of a known third-party.
IDAHO
In the leading case of Hillock v Idaho Title & Trust Co, 22 Idaho 440; 126 P 612 (1912) involving the purchaser of an abstract against the abstracter, Idaho moved to a tort cause of action in abstracter liability cases. The Court held the statute of limitations began to run when the fault in the abstract was discovered. Idaho Code § 54-101 had, since 1897, extended liability to "any person” injured by an abstracter’s negligence and this approach was upheld in Merrill v Fremont Abstract Co, 39 Idaho 238; 227 P 34 (1924).
ILLINOIS
In Chase v Heaney, 70 Ill 268 (1873), the language refers to any injured party while the facts of the case showed recovery by a plaintiff-purchaser of the abstract. Ill Ann Stats Chpt 115 § 25 clearly makes abstracters liable to purchasers of abstracts (since 1903). Rozny v Marnul, 43 Ill 2d 54; 250 NE2d 656; 35 ALR3d 487 (1969), a surveyor’s case citing abstracter case precedent, moved Illinois clearly into the tort arena, abolishing the privity concept and accepting the tort cause of action arising from the breach of a contractual duty. See generally 1 Ill Digest (3d ed), Abstracts of Title § 5.
INDIANA
In Brown v Sims, 22 Ind App 317; 53 NE 779 (1899), the strict privity rule was held inapplicable where the abstracter has knowledge of a third-party relying on the abstract.
IOWA
Iowa has ruled a cause of action against an abstracter to be in contract since before the turn of the century. Russell & Co v Polk County Abstract Co, 87 Iowa 233; 54 NW 212; 43 Am St Rep 381 (1893). But in an interesting case the Court found the abstracter liable in contract to the undisclosed principal of an agent who purchased the abstract. Young v Lohr, 118 Iowa 624; 92 NW 684 (1902). And a recent case, Ryan v Kanne, 170 NW2d 395 (Iowa, 1969), an accountant’s liability case portends a move to some sort of foreseeability standard under Restatement Torts 2d § 552, although the case required only a finding that it was a known third-party.
KANSAS
On the basis of the old Kansas abstracter legislation, the requirement of strict privity was closely followed. Mallory v Ferguson, 50 Kan 685; 32 P 410; 22 LRA 99 (1893); Symns v Cutter, 9 Kan A 210; 59 P 671 (1900); Allen v Hopkins, 62 Kan 175; 61 P 750 (1900). But in Arnold & Co v Barner, 91 Kan 768; 139 P 404 (1914), the new Kansas abstracter bond statute (now Kans Stat Ann 58-2802) was held to broaden liability to "any person” regardless of who paid for the abstract, but the statute of limitations ran from the date of furnishing the abstract.
KENTUCKY
Kentucky appears to have no statutory or case law on this point.
LOUISIANA
In Louisiana, the Register of Conveyances has the responsibility of issuing certificates of title showing the existence of all encumbrances. La Civ Code, Art 2251 et seq. Under this statute, Louisiana case law has moved from the strict privity requirement of Morano v Shaw, 23 La Ann 379 (1871) to the foreseeability test illustrated in American Legion Ed Brauner Post No 307, Inc v Southwest Title & Insurance Co, (La App, 1968) 207 So 2d 393, rev’d on other grds, 218 So 2d 612 (1969). In American Legion, the Register of Conveyances was found liable not only to the purchasing grantee but also to the unknown, relying grantor and title insurer.
MAINE
Maine appears to have no statutory or case law on this point.
MARYLAND
In Watson v Calvert Building & Loan Association, 91 Md 25; 45 A 879 (1900); Wlodarek v Thrift, 178 Md 453; 13A2d 774 (1940); and Corcoran v Abstract & Title Co of Maryland, 217 Md 633; 143 A2d 808 (19s58), an abstracter action was held to be limited to strict contractual privity though in Watson plaintiff recovered though his agent was the abstract purchaser.
MASSACHUSETTS
There appears to be no statutory or case law with respect to abstracter liability.
MICHIGAN
In Smith v Holmes, 54 Mich 104; 19 NW 767 (1884), it was stated that an abstracter’s liability action was an action based on negligent performance of a contract. Kenyon v Charlevoix Improvement Co, 135 Mich 103; 97 NW 407 (1903) noted, in dicta, the requisite of strict privity. But Beckovsky v Burton Abstract & Title Co, 208 Mich 224; 175 NW 235 (1919) found privity where plaintiff was probably a third-party grantee. See discussion in body of opinion, supra.
MINNESOTA
In Mulroy v Wright, 185 Minn 84; 240 NW 116 (1931), Minnesota moved to note the irrelevance of the privity concept following the reasoning of Glanzer, supra, and moving to a tort analysis. There the actual defendant was not an abstracter but a city official who furnished the abstracter erroneous information. Plaintiff was the buyer of property from owner who ordered abstract. Minn Stat Ann § 386.66 has limited though the amount of damages recoverable by "any person” so injured to the amount of the abstracter’s bond, $25,000.
MISSISSIPPI
Mississippi appears to have no statutory or case law on this point.
MISSOURI
In Zweigardt v Birdseye, 57 Mo App 462 (1894), and Schade v Gehner, 133 Mo 252; 34 SW 576 (1896), Missouri Courts stuck by the absolute privity requirement even where the abstracter had knowledge of affected third-parties. Anderson v Boone County Abstract Co, 418 SW2d 123; 34 ALR3d 1111 (Mo, 1967), reaffirmed these holdings. But Slate v Boone County Abstract Co, 432 SW2d 305 (Mo, 1968) created an exception with respect to known third-party "beneficiaries”, and, most recently, Aluma Kraft Manufacturing Co v Elmer Fox & Co, 493 SW2d 378 (Mo App, 1973), an accountant’s liability case, cited Anderson and Slate in moving to a balancing test involving foreseeability. See also Thorne v Johnson, 483 SW2d 658 (Mo App, 1972), which involved suit by owner and his grantees and their grantees against a negligent abstracter. An unfavorable judgment on the pleadings against liability was reversed.
MONTANA
In Western Loan & Savings Co v Silver Bow Abstract Co, 31 Mont 448; 78 P 774 (1904), it was held that privity was required but the exception was noted where the abstracter has knowledge of plaintiff. Since the decision in that case, Montana adopted Mont Rev Code § 66-2113 which creates a cause of action on an abstracter’s bond of $5,000 "for the use of any owner, mortgagee or other person having an actual interest in the real estate covered by an abstract of title”. The constitutionality of this statute was upheld by State ex rel Freeman v Abstracters Board of Examiners, 99 Mont 564; 45 P2d 668 (1935).
NEBRASKA
The early Nebraska rule with respect to abstracter’s liability was on the order of strict priv ity. Thomas v Carson, 46 Neb 765; 65 NW 899 (1896). However, passage of the predecessor to Rev State Neb § 76-501 changed Nebraska law extending liability to "any party” suffering damages. Gate City Abstract Co v Post, 55 Neb 742; 76 NW 471 (1898); Crook v Chilvers, 99 Neb 684; 157 NW 617 (1916); Ehlers v Pound, 176 Neb 673; 126 NW2d 893 (1964); Marley v McCarthy, 129 Neb 880; 263 NW 385 (1935).
NEVADA
Nevada, since 1927, has had a statute equivalent to the current Nev Rev Stats Title 19, § 240.330 which extends abstracters’ liability "[f]or any misconduct or neglect in any of the matters in which any commissioned abstracter * * * , is authorized to act, he shall be liable on his official bond to the person or persons injured thereby for all damages sustained.”
NEW HAMPSHIRE
There appears to be no statutory or case law on this specific point in New Hampshire.
NEW JERSEY
The early case of Economy Building & Loan Association v West Jersey Title & Guarantee Co, 64 NJL 27; 44 A 854 (1899) relaxed the strict privity requirement with respect to agents and third-party beneficiaries.
NEW MEXICO
New Mexico Stat Ann § 70-2-6 and its predecessors extend abstracters’ liability to "any person * * * acting in faith and reliance upon an abstract.” Gallegos v Ortiz, 28 NM 598; 216 P 502 (1923). Interestingly, the New Mexico abstracter statute has its own six year statute of limitations. New Mex Stat Ann § 70-2-7.
NEW YORK
Glawatz v People’s Guaranty Search Co, 49 App Div 465; 63 NYS 691 (1900) denied recovery to a subsequent grantee for lack of privity. In Glanzer v Shepard, 233 NY 236; 135 NE 275; 23 ALR 1425 (1922) then Judge Cardozo in a weigher’s case allowing recovery by an unknown third-party beneficiary applied the same liability in dicta to abstracters. In Cole v Vincent, 229 App Div 520; 242 NYS 644 (1930), the Appellate Division said recovery by a third-party beneficiary would depend upon a jury decision as to whether or not the abstracter could be charged with knowledge his abstract would be relied on by someone in addition to the purchaser thereof. Next came Ultramares v Touche, 255 NY 170; 174 NE 441; 74 ALR 1139 (1931) where then Judge Cardozo limited the rule of foreseeability he set forth in Glanzer in an accountant’s case. In Goodman v Title Guarantee & Trust Co, 206 NYS2d 32; 11 App Div 2d 1003 (1960), in a case where a potential buyer of plaintiffs property ordered an abstract from defendant abstracter and was deterred from buying because the abstract falsely showed weakness and where the abstracter "had knowledge of the terms of the contract and knew the purpose to which the report would be put”, the Court allowed an action in fraud. It used fraud because unless "negligence so reckless as to justify a finding that the defendant had no knowledge of or genuine belief in [the] accuracy” of the abstract, there could be no recovery under Ultramares unless privity. Subsequently, the New York Supreme Court in Cecala v Title Guarantee Co, 45 Misc 2d 986; 258 NYS2d 464 (1965) relied on Goodman to allow suit in fraud for "gross errors” in a title search in a case involving plaintiff owner of property suing the abstracter for a false abstract delivered to hirn — no question of privity.
NORTH CAROLINA
North Carolina appears to have no statutory or case law on this point.
NORTHDAKOTA
Though ND Cent Code § 43-01-11 and its predecessors have, since 1889, expanded an abstracter’s liability to "any person”, it is nonetheless clear that in North Dakota, the cause of action remains in contract not in tort and that this is not a fraud cause of action with the element of intent constructively supplied. Commercial Bank of Mott v Adams County Abstract Co, 73 ND 645; 18 NW2d 15 (1945) (third-party purchaser cause of action against abstracter).
OHIO
In Thomas v Guarantee Title & Trust Co, 81 Ohio St 432; 91 NE 183 (1910), Ohio stuck by the requirement of strict contractual privity. But a later Court of Appeals decision extended privity to an apparent undisclosed principal on an agency theory. Bowden v Meade, 1 Ohio L Abs 596 (1923).
OKLAHOMA
Under Okla Stat Ann Title 1 § 1, it has been clear in Oklahoma for a long time that an abstracter is liable to "any person” for his or her negligent preparation of an abstract. Scott v Jordan, 55 Okla 708; 155 P 498 (1916). But reliance must be shown on the abstract to recover. Randall v Paine-Nichols Abstract Co, 205 Okla 430; 238 P2d 319; 28 ALR2d 887 (1951). It is clear though that such an action remains in contract not in tort and the statute of limitations begins with delivery of the abstract. Garland v Zebold, 98 Okla 6; 223 P 682 (1924).
OREGON
Since 1923, Oreg Rev Stats § 30.750 has extended abstracter’s liability to "any person” injured by negligent workmanship. But the Oregon statute allows written limitation of liability if expressly written into the abstract certificate.
PENNS YL VANIA
Pennsylvania has a long line of cases supportive of the retention of the privity requirement. M’Caraher v Commonwealth, 5 Watts & S 21; 39 Am Dec 106 (1842); Commonwealth ex rel Kellogg v Harmer, 6 Phila 90; 22 Phila Leg Int 76 (1865); Houseman v Girard Mutual Building & Loan Association, 81 Pa 256; 2 WNC 573; 33 LI 108 (1876); Siewers v Commonwealth, 87 Pa 15 (1878); Henkels v Philadelphia Title Insurance Co, 177 Pa Super 110; 110 A2d 878 (1955). But there is authority noting an exception where the abstracter knew of a third-party relying on the abstract. Peabody Building & Loan Association v Houseman, 89 Pa 261; 11 WNC 193; 34LI 5; 33 Am Rep 757 (1879).
RHODE ISLAND
Rhode Island appears to have no statutory or case law on this point.
SOUTH CAROLINA
South Carolina appears to have no statutory or case law on this point.
SOUTHDAKOTA
SDCL § 36-13-15, the South Dakota abstracter bond statute runs to "any person” injured by an abstracter’s negligence. Stephenson v Cone, 24 SD 460; 124 NW 439 (1910). This statute in one form or another dates back to 1889. But the cause of action under this statute is clearly in contract. DuPratt v Black Hills Land & Abstract Co, 81 SD 637; 140 NW2d 386 (1966).
TENNESSEE
In a series of noted cases, Dickle v Abstract Co, 89 Tenn 431; 14 SW 896 (1890); Denton v Nashville Title Co, 112 Tenn 320; 79 SW 799 (1903); Equitable Building & Loan Association v Bank of Commerce & Trust Co, 118 Tenn 678; 102 SW 901 (1907), Tennessee stuck to the theory of strict privity with the exception of third-party grantees the abstracter knew about. In Tartera v Palumbo, 224 Tenn 262; 453 SW2d 780 (1970), a surveyor case, a tort theory of liability was adopted citing Glanzer, supra, and Restatement Torts (2d) § 552.
TEXAS
Originally an abstracter’s liability was in contract in Texas. Decatur Land, Loan & Abstract Co v Rutland, 185 SW 1064 (Tex Civ App, 1916). The leading case of Chicago R I & G R Co v Duncan, 273 SW 908 (Tex Civ App, 1925) moved to a tort cause of action though plaintiff was the purchaser of the misrepresented abstract.
UTAH
Utah Code Ann § 1-1-12 creates a specific cause of action for "any person” damaged by an abstracter’s negligence. This statute has been in effect since 1937.
VERMONT
Vermont appears to have no statutory or case law on this point.
VIRGINIA
Virginia appears to have no statutory or case law on this point.
WASHINGTON
Washington has, in this context, reaffirmed the contractual nature of this cause of action and limited liability to those in privity in Bremerton Development Co v Title Trust Co, 67 Wash 268; 121 P 69 (1912) and Douglas v Title Trust Co, 80 Wash 71; 141 P 177 (1914). An exception has been noted with respect to relying third-parties. Anderson v Spriestersbach, 69 Wash 393; 125 P 166 (1912) (abstracter both knew and delivered the abstract to third-party beneficiary). While purporting to adhere to Anderson, a later case allowed recovery in contract against an abstracter who prepared an abstract for plaintiffs’ attorneys without any knowledge of the agency whatsoever. Murphy v Fidelity Abstract & Title Co, 114 Wash 77; 194 P 591 (1921).
WEST VIRGINIA
West Virginia appears to have no statutory or case law on this point.
WISCONSIN
In Peterson v Gales, 191 Wis 137; 210 NW 407; 47 ALR 956 (1926), the requirement of strict privity was established in Wisconsin in strong dicta.
WYOMING
Wyo Stat § 33-12 has, since 1890-1, extended an abstracter’s liability to "any person.” See generally Abstracter’s Liability in Examination of Title, 6 Wyo LJ 184 (1952).s
See discussion of Beckovsky v Burton Abstract & Title Co, 208 Mich 224; 175 NW 235 (1919), infra.
Spence v Three Rivers Builders & Masonry Supply, Inc, 353 Mich 120; 90 NW2d 873 (1958).
Justice Cardozo in extending a weigher’s liability to a known third-party beneficiary against the defense of privity, among other reasons stated:
"Constantly the bounds of duty are enlarged by knowledge of a prospective use.”
In making this statement he relied upon, as we shall, a products liability case, his famous case of MacPherson v Buick Motor Co, 217 NY 382; 111 NE 1050; 1916F LRA 696 (1916). Glanzer v Shepard, 233 NY 236, 240; 135 NE 275; 23 ALR 1425 (1922). In dicta, Judge Cardozo found this same lack of immunity specifically applicable to abstracters:
"No such immunity, it has been held, protects the searcher of a title, who, preparing an abstract at the order of a client, delivers it to another to induce action on the faith of it.” (Citations omitted.) 233 NY 240.
Fifteen states have abstracter bond and liability statutes of this nature. Ark Stats Ann 71-106; Colo Rev Stats 1963 Chpt 1-1-5; Idaho Code § 54-101; Kans Stat Ann 58-2802; Minn Stat Ann § 386.66; Mont Rev Code § 66-2113; Rev Stat Neb § 76-501; Nev Rev Stats, Title 19, § 240.330; New Mex Stat Ann § 70-2-6; ND Cent Code § 43-01-11; Okla Stat Ann Title 1 § 1; Oreg Rev Stats § 30.750; SDCL § 36-13-15; Utah Code Ann § 1-1-12; Wyo Stat § 33-12. A typical example of such a statute is Idaho Code § 54-101:
"54-101. Abstracters to give bond. — It shall be a misdemeanor for any person or persons to engage in the business of compiling abstracts of title to real estate in the state of Idaho, and demand and receive pay for the same, without first filing in the office of the county recorder of the county in which such business is conducted, a surety bond to the state of Idaho, in the penal sum of $10,000, with a-surety company authorized to do such business in Idaho as security conditioned for the payment by such abstracters of any or all damages that may accrue to any .party or parties, by reason of any error, deficiency or mistake in any abstract or certificate of title, made and issued by such person or persons.”
Note also the discussion of the rationale for the Wyoming abstracter liability statute in Abstracter’s Liability in Examination of Title, 6 Wyo LJ 184-185 (1952):
"The use of abstracts of title has expanded greatly in conveyancing transactions in recent years. The legislature took the increased use of abstracts into consideration and expanded their value in that an abstract could be used as evidence in any case in which validity of title was questioned either directly or collaterally, by anyone directly interested, whether the person to whom the abstract was issued or not. Having thus widened the abstract’s sphere of use it was natural that the legislature should include within the protection of this statute any person who might suffer from fraud or mistake of the abstractor.”
See Asppendices A and B.
See Appendices A and B.
See Appendices A and B.
See Appendices A and B.
See Appendices A and B.
The language in Talucci is worthy of note for the clarity with which it makes this point. Talucci was a suit by an employee against an independent contractor hired by plaintiffs employer. The Court, in finding a tort cause of action stated:
"The duty allegedly owing is that which accompanies every contract, a common-law duty to perform with ordinary care the thing agreed to be done. * * * Those foreseeably injured by the negligent performance of a contractual undertaking are owed, as in this case, a duty of care.” 20 Mich App 153, 161.
For suit in tort, see also Chicago RI & G R Co v Duncan, 273 SW 908, 910 (Tex Civ App 1925), where a Texas appellate court succinctly held:
"The making of the contract involved was accompanied with a common-law duty to perform the work agreed to be done, to wit, the making of the abstract with skill, reasonable expedience, and faithfulness, and the negligent failure on the part of appellee’s testator to include in the abstract made by him the omitted deed which caused appellant to sustain damage, as alleged, was a tort as well as a breach of the contract.”
And see Hawkins v Oakland Title Insurance & Guaranty Co, 165 Cal App 2d 116; 331 P2d 742 (1958); Viotti v Giomi, 230 Cal App 2d 730; 41 Cal Rptr 345 (1964); Chun v Park, 51 Hawaii 462; 462 P2d 905 (1969); Hillock v Idaho Title & Trust Co, 22 Idaho 440; 126 P 612 (1912). Also see Arizona Title Insurance & Trust Co v O’Malley Lumber Co, 14 Ariz App 486; 484 P2d 639 (1971); Mulroy v Wright, 185 Minn 84; 240 NW 116 (1931), non-abstracter cases but relying on abstracter cases.
See especially Damages for Innocent Misrepresentation, 73 Col LR 679 (1973); Misrepresentation As Deceit, Negligence or Warranty, 42 Harv LR 733 (1929); Prosser, Misrepresentation and Third Persons, 19 Vand LR 231 (1966); Green, The Duty To Give Accurate Information, 12 UCLA LR 464 (1965); Should Negligent Misrepresentations Be Treated as Negligence or Fraud, 18 Va LR 703 (1932).
In a case where fraudulent intent is alleged, an action continues to lie in fraud. See Smith v Holmes, supra, 112. See also on this point, the recent lower Federal court case which allowed a $25,000 punitive damages recovery to a non-contracting consumer’s group denied the speaking services of Ralph Nader through airline overbooking policies. The court found this group to be a foreseeable, relying plaintiff with respect to defendant’s intentional misrepresentation. Nader v Allegheny Airlines Inc, 356 F Supp 128 (DCDC, 1973).
An abstracter, obviously, is not responsible for a legal conclusion as to whether good title exists on the basis of his or her abstract. Furthermore it should be noted, for example, that an abstracter would not be liable for failure to record items not contained in the public record nor part of the contract of employment.
See Green, The Duty To Give Accurate Information, 12 UCLA LR 464, 483 (1965); 1 Harper & James, "The Law of Torts”, § 7.6, p 546; 17 CJS, Contracts, § 154(c).
1 Am Jur 2d 245; 1 CJS, Abstracts of Titles, § 13a, p 399; 54 CJS, Limitations of Actions, § 161, p 110; Patton on Titles (2d ed) § 44, p 153, n 55.
This interpretation of Coury is supported by 1969 Annual Survey of Civil Procedure, 16 Wayne LR 501, 509-510. The author of the Wayne Law Review article cites two lower court cases, Gambrell v Dreis & Drump Manufacturing Co, Civil No 32247 (ED Mich, April 25, 1969) and Hoeppner v E W Bliss Co, Civil No 106316 (Cir Ct Wayne Co, December 26, 1968), products liability cases, which have held that a cause of action does not accrue until the injury.
Of course, this interpretation is unnecessary in products liability cases based on breach of warranty. In those cases, MCLA 600.5833; MSA 27A.5833 provides that "the claim accrues at the time the breach of the warranty is discovered or reasonably should be discovered.” Coury can be thought of as speaking generally to MCLA 600.5827; MSA 27A.5827 the general provision on accrual of claims.
Cf. Randall v Paine-Nichols Abstract Co, 205 Okla 430; 238 P2d 319; 28 ALR2d 887 (1951).
The Michigan Court of Appeals in this case quoted with approval . from Hillock v Idaho Title & Trust Co, 22 Idaho 440, 449; 126 P 612, 615 (1912) to the same effect. While the Idaho Court adopted a fraud rationale and we a misrepresentation rationale, we agree with that Court’s quotation as regards the statute of limitations:
" 'If the statute runs in favor of the abstractor from the delivery of the abstract, the company would be released long before the falsity of the abstract could reasonably be discovered by the purchaser. This would not be justice, and ought not to be the law.’ ” 43 Mich App 95, 98.
The Hillock language was also cited with approval by the Texas Appellate Court in Chicago R I & G R Co v Duncan, supra, n 10.
In these jurisdictions, cases in analogous contexts (generally accountant’s or surveyor’s liability) have adopted a forseeability standard (columns V or VI). See Appendix B.
In these jurisdictions, Courts have adopted a tort rationale, but with respect to this analysis, only in dicta, as the prevailing plaintiffs either contracted for the abstract or were known third-party beneficiaries. See Appendix B.
This jurisdiction does contain a non-abstracter case recognizing the tort of negligent misrepresentation relying on abstracter cases. See Appendix B.
See Appendix B for details.
A later Ohio Court of Appeals case granted recovery to an undisclosed principal; the earlier Ohio Supreme Court case has been treated as controlling. See Appendix B. | [
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Butzel, J.
Hermanus Rosema and wife own a strip of land 500 feet long on the north bank of Grand River, a navigable stream, near Ferrysburg. Construction Materials Corporation, defendant, owns 1,500 feet of river frontage immediately east of plaintiffs’ property. Defendant conducts a large sand and gravel plant on its water front, which is improved by docks for shipping. There is no dock, wharf, or landing of any kind on plaintiffs’ river frontage, and it is unimproved except for the dwelling house and barn at the extreme north end. Defendant has a number of boats used in the sand business. One of them would almost daily tie up along the side of defendant’s wharf near the easterly line of plaintiffs’ property so that the stern of the boat would project out into the water in front of plaintiffs’ property, but leave considerable space between the water line and the boat. Several times defendant’s agents went'on plaintiffs’ property in order to tie up its boats, but it does not claim any right to do so, and it has discontinued this practice. At most, there have been casual trespasses. Plaintiffs, however, claim that defendant had no right to moor its boats continually in front of their property, and in asking for injunctive relief they express a fear that defendant may claim prescriptive rights to the use of plaintiffs’ water-front. We are not confronted with a situation where there are adjoining wharves or docks, or where plaintiffs are being deprived of free access to their property. The correct rule is set forth in Original Hartlepool Collieries Co. v. Gibb, 46 L. J. Ch. (N. S.) 311 (5 Ch. D. 713, 36 L. T. 433, 3 Asp. M. C. 411), where the court held that a navigable river is a public highway, navigable in a reasonable way by everyone. Accordingly, a riparian owner has a right to moor a ship of ordinary size alongside his wharf, to load or unload, although his boat may overlap his neighbor’s premises, provided reasonable access is not obstructed.
This rule was not changed by Hilt v. Weber, 252 Mich. 198 (71 A. L. R. 1238), as claimed by plaintiffs. In the instant case, there is no showing of any nuisance. If there is any actionable trespass, the remedy is at law. McMorran v. Cleveland-Cliffs Iron Co., 253 Mich. 65. There can be no prescriptive rights under the circumstances to a part of the navigable stream in front of plaintiffs ’ property. The decree of the lower court is reversed, and the bill of complaint dismissed, with costs to defendant.
Clark, C. J., and McDonald, Potter, Sharpe, North, Fead, and Wiest, JJ., concurred. | [
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Per Curiam.
Plaintiffs Charles B. Harrison (plaintiff), Nancy Harrison, and Jessica Lynn Harrison filed suit against defendants Grand Trunk Western Railroad Company and the Oakland County Road Commission for damages arising out of a collision between the railroad’s train and plaintiff Charles Harrison’s car. Nancy and Jessica Harrison were not involved in the accident and their actions are for the derivative claims of loss of consortium. A jury found no negligence on the part of defendants and a judgment of no cause of action was entered. Plaintiffs motion for new trial was denied, and he appeals as of right. We affirm.
Plaintiff raises five issues on appeal. First, he argues that the trial court erred in granting defendants’ motion in limine and in directing a verdict in favor of defendants on the issue of their duty to petition for additional grade crossing protections.
Prior to trial, defendants moved for summary disposition on several issues, including plaintiff’s theory that the defendants had a duty to petition the state for additional grade crossing devices. Plaintiff claims on appeal that the trial court granted a motion in limine that prevented him from presenting evidence to the jury on this issue.
An examination of the record reveals that the court merely prohibited plaintiff from referring to this alleged duty in opening statement because it needed time to review the motion. There was no total prohibition as plaintiff claims. We also note that plaintiff did in fact raise this issue. However, contrary to this argument, the experts testified that additional safeguards, in the form of higher signs, as plaintiff proposed, were not required.
Plaintiff also argues that the trial court erred in granting defendants’ motion for directed verdict on this duty issue.
In reviewing the grant or denial of a directed verdict, this Court must view the evidence in a light most favorable to the nonmoving party. If the evidence establishes a prima facie case, a directed verdict is improper. Clery v Sherwood, 151 Mich App 55, 63-64; 390 NW2d 682 (1986). The issue is for the jury if there are material issues of fact upon which reasonable minds can differ. Id., 64.
Plaintiff contends that the defendants have a common-law duty to petition the state for additional grade crossings where there is a safety need. We agree with plaintiff but find that the directed verdict was, nonetheless, properly granted.
Only authorized officials can maintain or place a high traffic sign, including railroad warning signs. MCL 257.615; MSA 9.2315. In the same vein, the liability of county road commissions at railroad crossings is limited as follows:
The erection of or failure to erect, replace, or maintain a stop or yield sign or other railroad warning device, unless such devices or signs were ordered by public authority, shall not be a basis for an action of negligence against the state transportation department, county road commissions, the railroads, or local authorities. [MCL 257.668(2); MSA 9.2368(2).]
Prior to the 1979 amendment of MCL 257.668; MSA 9.2368, the act limited the liability of the road commissions, but not of the railroads, as follows:
The erection of or failure to replace or maintain such signs shall not be a basis for any action of negligence against the state highway commissioner, the several county road commissions or local authorities.
In other words, defendants cannot erect additional crossing signs without proper permission, MCL 257.615; MSA 9.2315. They also will not be liable for failure to erect a sign unless the sign was ordered by public authorities, MCL 257.668; MSA 9.2368. However, apart from the above provisions, defendants still have the common-law duty of due care. Cryderman v Soo Line R Co, 78 Mich App 465; 260 NW2d 135 (1977), lv den 402 Mich 867 (1978); Johnson v Grand Trunk Western R Co, 58 Mich App 708, 717; 228 NW2d 795 (1975); People v Grand Trunk Western R Co, 3 Mich App 242, 248; 142 NW2d 54 (1966). That duty includes petitioning the proper authorities when the railroad or the county considers warning devices at a dangerous crossing to be insufficient, so that the situation can be remedied. Cryderman, supra, 470-471, 476; Johnson, supra, 717-718; Grand Trunk Western R Co, supra, 248.
Cryderman was decided before the 1979 amendment to MCL 257.668; MSA 9.2368 which included railroads in its liability exculpation provision and dealt with the road commission’s responsibility to request higher signing. In that case, this Court rejected the road commission’s argument that it cannot be held liable for its failure to petition the Public Service Commission in view of the prohibitions contained in MCL 257.615; MSA 9.2315. Cyderman, supra, 478.
Therefore, neither MCL 257.615; MSA 9.2315 nor MCL 257.668; MSA 9.2368 exempts either the railroad or the road commission from liability if they knew of a dangerous condition at the crossing and failed to petition for higher signing.
However, in the instant case, there was no evidence to prove that a dangerous condition existed at this crossing which would have placed a duty on the defendants to petition for different warning devices. The road involved was a rural, dirt road and a train crossed, at most, twice a day. The crossing was equipped with crossbucks, a stop sign, and an advance warning sign. There was no testimony presented that such signaling devices were inadequate. Even plaintiff’s strongest witness, a railroad safety inspector who inspected the accident site a few months prior to the accident, testified that he did not recommend any change in signaling. Plaintiff has failed to present any evidence that there was a need for additional signaling devices. Thus, reasonable minds would conclude that the defendants did not breach their duty to petition for additional signaling. Accordingly, the directed verdict was properly granted.
Plaintiff’s second argument is that the trial court committed error in excluding an investigative report, written by the railroad, from being admitted into evidence. We disagree.
By statute, a monthly report must be made of all collisions or accidents resulting in death or serious injury arising from the operation of a railroad by a common carrier. 45 USC 38. However, the statute expressly provides that the report may not be used as evidence in any suit that grows out of such collision or accident. 45 USC 41. Thus, the report was properly excluded.
Furthermore, a trial court may exclude evidence as speculative, MRE 403. The court’s determination to exclude evidence under MRE 403 will not be reversed absent an abuse of discretion. Kirk v Ford Motor Co, 147 Mich App 337, 343; 383 NW2d 193 (1985). Here, the trial court excluded the report because it was based on hearsay with no independent investigation. We find no error.
Plaintiff’s third argument is that a new trial should be ordered because the case was improperly scheduled for trial and not allowed to proceed through mediation. The instant action was filed on August 2, 1983. The pretrial conference was in June, 1984, and the discovery cutoff date was November, 1984. The trial was held in May, 1985.
Plaintiff cites no authority for his proposition that he had a right to mediation or that trial occurred too early. A statement of position without supporting citations is insufficient to bring an issue before this Court. In re Futch, 144 Mich App 163, 166; 375 NW2d 375 (1984).
We also note that, pursuant to MCR 2.403 and GCR 1963, 316.1, mediation is not mandatory. Specifically, MCR 2.403 provides:
A court may submit to mediation any civil action in which the relief sought consists of money damages or division of property. [Emphasis added.]
Mediation was scheduled at least twice during the course of this action but was adjourned both times at plaintiff’s request. Finally the court placed the case on the trial docket. After the completion of discovery, a trial court has three options: (1) schedule a pretrial conference; (2) schedule the action for mediation; or (3) schedule the action for trial. MCR 2.501(A). Should a court select an action for mediation, the selection "has no effect on the normal progress of the action toward trial.” MCR 2.403(B)(2). The trial court attempted to schedule the case for mediation but, after delays, scheduled trial. MCR 2.501(A)(3). The trial court’s action in scheduling trial did not constitute an abuse of discretion.
Plaintiff’s fourth argument is that the trial court erred because it conducted voir dire itself rather than allowing plaintiff to do it and because the court excused two jurors. We disagree.
The trial court itself may conduct voir dire or the court may permit the attorneys to do so. MCR 2.511(C), formerly GCR 1963, 511.3. Plaintiff does not contend that he requested questions of the jurors which the trial court refused to ask or that the trial court’s examination was inadequate. There was no error.
Further, the trial court did not abuse its discretion when it dismissed two jurors for cause. A trial court has broad discretion in its voir dire examination and its decision on a juror’s impartiality will be reversed on appeal only if it represents a clear abuse of discretion. Willoughby v Lehrbass, 150 Mich App 319, 331; 388 NW2d 688 (1986); Haisenleder v Reeder, 114 Mich App 258, 266; 318 NW2d 634 (1982), lv den 417 Mich 969 (1983).
In the instant case, the trial court dismissed four jurors on its own initiative. The jurors whose dismissal plaintiff contests were jurors No. 4 and 7. Both jurors were excused because they indicated they would have a difficult time being impartial. The trial court did not err when it dismissed the jurors due to indications of bias and partiality. MCR 2.511(D).
Plaintiff’s final contention is that the jury’s verdict, finding no negligence on the part of defendants, was against the great weight of the evidence. We disagree. There was testimony that residents in the vicinity did not have any problems with the visibility of approaching trains. There was also ample evidence to conclude that the proximate cause of the accident was plaintiff’s negligence in failing to stop at the stop sign.
Affirmed. | [
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] |
Per Curiam.
Plaintiffs appeal as of right from the trial court’s order granting defendant’s motion for summary disposition on the basis of the statute of limitations. MCR 2.116(C)(7). We affirm.
On May 28, 1980, plaintiff Theresa Baldyga (hereinafter plaintiff) and defendant entered into a contract wherein plaintiff agreed to make payments in exchange for defendant’s provision of certain health-care services by preselected healthcare professionals, including physicians. In August of 1981, plaintiff was treated by two physicians pursuant to her contract with defendant. At that time, these physicians allegedly committed malpractice. In August, 1985, plaintiff sued defendant claiming that it breached its contract by:
A. Failing to provide, employ or retain competent physicians, nurses, medical co-admitting phy sicians, and paramedical personnel for the care and treatment of plaintiff, Theresa Baldyga.
B. Failing to review and supervise the activities of staff physicians to determine their competency and qualifications as orthopedic surgeons, surgeons and general practitioners.
C. Failing to review the services performed by its staff physicians and/or surgeons and to thereby prevent unnecessary, unwarranted and negligently performed surgery.
Plaintiff further claimed that defendant warranted the quality of its physicians by preselecting them. Plaintiff Richard Baldyga claims that he was a third-party beneficiary of plaintiff’s contract with defendant.
As a result of this alleged breach of contract, plaintiff sought to recover damages for pain and suffering, medical expenses and lost earnings. Richard Baldyga sought damages for loss of consortium.
Defendant moved for summary disposition, claiming that plaintiffs’ complaint was barred by the statute of limitations because plaintiffs sought to recover for personal injuries. MCL 600.5805 subds (4) and (8); MSA 27A. 5805 subds (4) and (8), and MCR 2.116(C)(7). Plaintiffs, on the other hand, claimed that they were suing for an express breach of contract, making a six-year period of limitation applicable. MCL 600.5807(8); MSA 27A.5807(8). The trial court granted defendant’s motion, holding that plaintiffs’ claim was a tort claim rather than an express contract claim.
In determining which statute of limitations applies, this Court has previously held:
The starting point is MCL 600.5813; MSA 27A.5813, which provides that all personal actions "shall be commenced within the period of 6 years after the claim accrues, and not afterwards unless a different period is stated in the statutes.” An exception to this general six-year rule is found in MCL 600.5805; MSA 27A.5805, which requires "any action to recover damages for injuries to persons or property,” not including certain specified tort actions, to be commenced within three years after the claim first accrues. There is an exception to the exception in MCL 600.5807(8); MSA 27A.5807(8) that re-establishes a six-year period of limitations on "actions to recover ... for breach of contract,” which according to the most recent Supreme Court interpretation applies to actions for damages to persons and property, so long as the suit is based on an express promise rather than a duty implied in law. Huhtala v Travelers Ins Co, 401 Mich 118; 257 NW2d 640 (1977). Finally, a special two-year limit has been worked out for malpractice suits [MCL 600.5805(4); MSA 27A.5805(4)]. [Coats v Uhlmann, 87 Mich App 385, 388-389; 274 NW2d 792 (1978).]
In Barnard v Dilley, 134 Mich App 375; 350 NW2d 887 (1984), the plaintiff sued the defendant, her attorney, claiming that his failure to properly represent her constituted a basis for a breach of contract claim as well as a general negligence claim. The trial court held that the plaintiff’s claim was a legal malpractice claim and was barred by the two-year period of limitation. This Court affirmed, finding that the plaintiff had contracted for the provision of legal services and that the plaintiff had not alleged that the defendant had failed to provide legal services. Instead, the plaintiff had alleged that the defendant had failed to "adequately” represent her. Therefore, this Court concluded that the plaintiff’s claim was one for malpractice and malpractice only. Id.
As with the contract in Barnard, supra, we find that plaintiff’s contract with defendant in this case was for the provision of health-care services by preselected physicians. Although plaintiff in this case, unlike in Barnard, alleges that defendant failed to provide her with care, it is undisputed and, indeed, plaintiff later asserts that she seeks to recover for the negligent care which was provided. Therefore, we apply the Barnard analysis and find that, insofar as plaintiff claims that defendant is vicariously liable for the medical care provided by defendant’s physicians, her claim is barred by the two-year period of limitation governing medical malpractice cases. Furthermore, we hold that plaintiff’s claims that defendant was negligent in hiring these doctors and in failing to supervise them were not based on the parties’ express contract but upon a duty implied in law, making a three-year period of limitation applicable. Coats, supra. See also Prosser, Torts (4th ed), §§ 92-93, pp 613-627.
Affirmed. | [
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M. J. Kelly, J.
The sole issue raised in this appeal is whether the trial court abused its discretion by ruling that thermographic evidence was admissible to prove serious impairment of a body function. Defendant contends that it was error to admit the evidence. We agree and reverse and remand.
Plaintiff’s claim is based on personal injuries she suffered after the automobile in which she was a passenger failed to stop at a blinking red light and collided with another car. Defendant driver admitted negligence at trial.
As a result of the accident plaintiff sought medical treatment. Despite the fact that x-rays did not reveal any injury, Arthur Kaselemas, M.D., plaintiff’s examining physician, determined that plaintiff had sustained a fairly severe injury to her neck. Subsequently, Ram Gunabalan, M.D., performed a thermographic study of plaintiff, which in Dr. Gunabalan’s opinion indicated an irritation of the eighth cervical nerve.
Prior to trial an evidentiary hearing was conducted to determine the admissibility of the results of the thermography. The trial court ruled that thermographic evidence was sufficiently accepted by disinterested experts to justify its admission. At the conclusion of trial, the trial court held:_
[B]ut for this thermographic test and evidence, the Court would have ruled that based upon current Michigan law today, and a review of medical evidence, the defendant [sic, plaintiff] did not meet the threshold to demonstrate serious impairment of a bodily function.
Based on the results of the thermography the lower court held that there was sufficient objective evidence and plaintiff had met her burden of proof.
"The admissibility of scientific evidence in this state is governed by the so-called Davis-Frye rule.” People v Young, 418 Mich 1, 17; 340 NW2d 805 (1983).
That rule as it now stands is a culmination of the reasoning in Frye v United States, 54 US App DC 46, 47; 293 F 1013 (1923); People v Davis, 343 Mich 348; 72 NW2d 269 (1955), and People v Barbara, 400 Mich 352; 255 NW2d 171 (1977). The rule is that expert testimony concerning a novel form of scientific evidence may be admitted so long as it is established that the evidence has achieved general scientific acceptance among impartial and disinterested experts in the field. The party offering the evidence has the burden of demonstrating that it has been accepted as reliable by the scientific community. People v Young, supra at 20.
At trial in this matter, plaintiff submitted the depositions of three experts to establish that thermography has achieved general scientific acceptance. Dr. Gunabalan stated that it was his opinion, based on his knowledge that thermography was used on a regular basis at leading medical institutions, that thermography was recognized and accepted as reliable and thermograms should be used as a diagnostic tool.
The deposition of Pierre Leroy, M.D., was also introduced into evidence on behalf of plaintiff. Dr. Leroy had written and lectured on the diagnosis and evaluation of pain through the use of thermography. Dr. Leroy likewise held the opinion that thermography was useful in the diagnosis and monitoring of pain in soft tissue injuries.
Plaintiff also introduced the deposition of Charles E. Wexler, M.D., a board-certified diagnostic radiologist as well as the secretary-treasurer of the American Academy of Thermology. It was Dr. Wexler’s opinion that thermography was a scientifically sound diagnostic tool that provided unique information on sensory nerve damage otherwise unavailable.
Before determining whether the conclusions reached by plaintiffs experts established that thermography has achieved general scientific acceptance, it is first necessary to determine whether the experts are disinterested and impartial. People v Young (After Remand), 425 Mich 470, 481; 391 NW2d 270 (1986). "The standard developed by this Court is whether the expert’s 'livelihood was not intimately connected with the new technique.’ ” People v Young (After Remand), supra at 483, quoting People v Tobey, 401 Mich 141, 145; 257 NW2d 537 (1977).
In Young (After Remand), the reliability of electrophoresis of evidentiary bloodstains was at issue. The Supreme Court held that the livelihoods of the police officer who did the electrophoresis analysis, and the director of the fbi’s serology laboratory, were too intimately connected with the new technique to make their testimony impartial. Young (After Remand), supra at 484.
In Tobey, the prosecutor was attempting to establish the admissibility of voice print evidence through the testimony of two experts, Dr. Oscar Tosí (a scientist), and Lt. Ernest Nash (a police officer). The Supreme Court held:
Neither Nash nor Tosi, whose reputations and careers have been built on their voice-print work, can be said to be impartial or disinterested. [People v Tobey, supra at 146.]
Similarly in People v Barbara, supra, where polygraph operators, polygraph teachers and others, whose business was the use and operation of polygraphs, testified to the scientific reliability of a polygraph test, the Supreme Court held that the witnesses were not disinterested scientists. 400 Mich 376.
The trial court in the instant case, in reaching its decision that the use of thermography was a scientifically accepted diagnostic tool, relied principally on the testimony of Dr. Wexler. However, it is clear from the deposition of Dr. Wexler that he is intimately involved in the elevation of thermography as a diagnostic technique and that he enjoyed a substantial income from the advancement of thermogram technology. Likewise, Dr. Gunabalan, and Dr. Leroy to a lesser extent, had economic interests in the advancement of thermogram technology. Dr. Gunabalan’s deposition established that he owned twenty-five percent of Thermographic Medical Evaluation Centers of Michigan, Inc., and that twenty percent of his practice dealt with thermogram technology. In the case of Dr. Leroy, his deposition established that since 1980 he has been a board member of the American Thermographic Society, that after many years of work he has developed a program using thermogram technology at the Delaware Pain Clinic and Thermography Laboratory, and that ten to fifteen percent of his practice involves thermogram technology.
In light of these facts, the trial court abused its discretion when it ruled that the reliability of thermography had been established by impartial and disinterested experts. The holding of the trial court is reversed. This case is remanded for determination by the trial court of whether plaintiff met her burden of proof in light of the Supreme Court’s decision in DiFranco v Pickard, 427 Mich 32; 398 NW2d 896 (1987).
Reversed and remanded. | [
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Shepherd, J.
Plaintiff appeals from a July 16, 1986, entry of summary disposition by the Ingham Circuit Court in favor of defendant Bureau of State Lottery and intervening defendants. We affirm.
The facts are not substantially in dispute. This controversy involves plaintiff’s entitlement to a share in an October 26, 1985, lotto drawing involving $3,601,554. In 1984, plaintiff applied for and purchased nine lotto subscriptions from defendant. For each subscription to defendant’s lotto game, an application was submitted on a Bureau of State Lottery subscription mailer form. The particular application at issue here was re ceived by defendant along with a check in the amount of $50. Under the "pick your plan” section of the application plaintiff was supposed to indicate whether he wanted ten drawings for $10, twenty-six for $25 or fifty-two drawings for $50. Plaintiff did not fill out the "pick your plan” section and state personnel treated the application as one for fifty-two drawings and circled that designation.
In November, 1984, plaintiff received a membership card from defendant indicating his lotto number 03 05 08 17 26 30. The membership card also indicated a beginning date of December 10, 1984, and an ending date of November 23, 1985. It was the position of defendant that the "ending date” was an "expected ending date” for the convenience of the player, primarily to give the player the information as to the time to renew the subscription. The ending date of the membership was based on the number of drawings as indicated in the member’s application. Plaintiff’s position was that the ending date was a binding contractual term which could not be unilaterally changed.
As originally established, lotto was a weekly draw game with drawings held on Saturday evenings. The details of the game were the subject of a directive issued by the Commissioner of the Bureau of State Lottery and placed on file with the office of the Secretary of State. On August 23, 1985, the format of the lotto was converted to twice-weekly drawings with drawings occurring on Wednesday and Saturday evenings each week.
During the time of August 7 through August 12, 1985, notices were sent by first class mail to all subscribers at their subscription addresses informing them of the forthcoming change to twice-weekly drawings. All subscribers were mailed a new membership card in conjunction with a notifi cation indicating a beginning date and the number of drawings, rather than the expected ending date. Plaintiffs notice and replacement membership cards were mailed to plaintiffs Friendswood, Texas, post office box address. On January 3, 1986, these materials were returned to defendant stamped "box closed — left no order.” Plaintiff had relocated his address from Texas to Greensboro, North Carolina, on or about June 1, 1985. Plaintiff took no action to inform defendant of his change of address because plaintiff continued to receive mail through the Friendswood, Texas, postal box. Plaintiff never received notification of the new twice-weekly drawings.
On the basis of defendant’s interpretation of the subscription, plaintiff was entered into fifty-two consecutive lotto game drawings from December 1, 1984, through October 9, 1985. In total plaintiff was entered into forty-five Saturday drawings and seven Wednesday drawings.
On Saturday, October 26, 1985, the winning lotto numbers were drawn as 03 05 08 17 26 30. The jackpot prize pool for the October 26, 1985, lotto drawing was calculated to be $3,601,554. Following the drawing, intervening defendants each appeared at the Lansing office of the Bureau of State Lottery and presented sufficient identification entitling each to win one-third of the lotto jackpot prize.
On October 28, 1985, plaintiff called defendant stating that he was the holder of a subscription which matched the six numbers drawn on the previous Saturday. Plaintiff was informed that his subscription had expired on October 9, 1985, and that notice had been mailed to him in mid-August indicating the change in the format of the lotto drawing. Plaintiff later appeared at defendant’s offices and filed a claim form for one-fourth of the share of the jackpot prize pool and later notified defendant in writing of his refusal to consent to what he termed a unilateral change of the lotto contract term.
On November 20, 1985, plaintiff filed a complaint against defendant in the Court of Claims alleging breach of contract. A declaratory judgment action was later filed in Ingham Circuit Court against intervening defendants by defendant bureau. The cases were ultimately consolidated in Ingham Circuit Court. All parties moved for summary disposition and on July 16, 1986, at the conclusion of the hearing, summary disposition in favor of defendant was granted.
Plaintiff argues that the lotto subscription contract entered into with defendant explicitly provided for fifty-two weeks of Saturday drawings with a starting date of December 1, 1984, and an ending date of November 23, 1985. Plaintiff claims defendant breached the lotto contract by unilaterally entering plaintiff into biweekly drawings and modifying the ending date without plaintiffs consent or consideration. Defendant counters that the contract provided for modification of game rules and that, by entering plaintiff into fifty-two lotto drawings, defendant fulfilled its contractual obligations.
MCL 432.1 et seq.; MSA 18.969(1) et seq. establishes a Bureau of State Lottery and the office of commissioner, designated to initiate, establish and operate a statewide lottery game for the purpose of deriving net revenues for the state treasury. MCL 432.9; MSA 18.969(9). In MCL 432.11; MSA 18.969(11), the act further provides in relevant part:
(1) The commissioner shall promulgate rules in accordance with and subject to Act No. 306 of the Public Acts of 1969, as amended, being sections 24.201 to 24.315 of the Michigan Compiled Laws, except to implement section 9 the rules are not subject to Act No. 306 of the Public Acts of 1969, as amended, for 18 months after the effective date of this act but shall be promulgated and effective as determined by the commissioner.
(2) The rules may include:
* * *
(f) The frequency of the drawings or selections of winning tickets or shares.
Under the act, a lottery winner’s entitlement to a prize is governed by principles of contract law. Coleman v Bureau of State Lottery, 77 Mich App 349, 351; 258 NW2d 84 (1977), lv den 402 Mich 837 (1977). In Coleman this Court held that, in purchasing her lottery ticket, the plaintiff accepted the bureau’s public offer that the purchaser of a lottery ticket would have a chance of winning a prize according to the advertised rules and procedures of the lottery and the plaintiff agreed to the announced rules for determining prize winners.
In the instant case, a determination of the issue requires construction of the lotto subscription contract entered into by the parties. The lotto subscription application executed by plaintiff provides that the subscriber pick six numbers from one to forty for an opportunity to share in the jackpot prize pool. The contract further provides for a guaranteed minimum jackpot prize pool of $1,000,000 per drawing. A subscriber was instructed to "pick your plan” and, by mailing a $50 check to defendant, plaintiff selected the option indicating "52 drawings.” The contract also provided:
Allow at least three weeks for processing. Subscription memberships will be effective as of the starting date indicated on the membership card.
Refunds will not be granted once a membership card has been issued.
Subscription memberships are subject to the rules, regulations, and directives of the Bureau of State Lottery and laws of the State of Michigan and any changes thereof. [Emphasis added.]
At the time of plaintiffs subscription, lotto was a weekly draw game with drawings taking place on Saturday evenings. The lotto subscription contract, however, did not mention that drawings were to be held weekly nor does the contract provide for Saturday drawings. Further, the contract nowhere mentions the words "year” or "weeks” or any other period of time. Thus, plaintiffs subjective expectation that he contracted with defendant for fifty-two Saturday drawings only is without merit. Further, the contract clearly stated that subscription memberships were subject to the rules, regulations, and directives of defendant Bureau of State Lottery "and any changes thereof.” Plaintiffs subscription membership card contained identical language. Plaintiff is bound by the plain language regarding changes in the rules, regulations and directives of defendant Bureau of State Lottery. The change from one drawing per week to two drawings per week effective August 28, 1985, was the result of a change in a general directive of the bureau. As such, this change was binding on plaintiffs subscription.
The change to twice-weekly drawings was not a change in the subscription contract, but rather a change in the game rules from which the subscription contract was a mode of participation. Thus, plaintiffs argument that defendant made a unilateral modification of the contract is without merit.
Plaintiff also argues, in the alternative, that the "any changes thereof’ clause is unenforceable as unconscionable. A two-pronged test has been applied by this Court in determining whether a contract is unenforceable as unconscionable. The first prong of the test measures the relative bargaining power of the parties, in short, measuring the options of those parties. The second prong of the test is a determination of whether a challenged term is substantively reasonable. See Stenke v Masland Development Co, Inc, 152 Mich App 562, 572-573; 394 NW2d 418 (1986). Even if a contract is one of adhesion under the first prong, a challenged provision remains enforceable if it is substantially reasonable and not oppressive or unconscionable. See Stenke at 573.
Although we are not entirely convinced that defendant’s bargaining power is vastly superior to plaintiff’s given the plethora of games of chance in surrounding states and the number of lottery games operated by this state, under the second prong the clause is entirely reasonable. The rule change, taking effect in August, 1985, was prospective in operation and affected all lottery customers. Furthermore, all subscription purchasers were notified by mail. The clause was not unconscionable.
Finally, plaintiff relies heavily on the membership card as evidencing the "ending date” of November 23, 1985. The subscription contract makes reference to a "membership card” which was to provide the effective starting date of the contract. The contract provides only for a plan of fifty-two drawings. Plaintiff received the benefit of his bargain, i.e., fifty-two consecutive drawings. The "ending date” was provided as a matter of convenience so that plaintiff would be able to renew his subscription if he chose to. Plaintiffs position causes us to pose the following hypothetical situation. If plaintiff’s lotto subscription number had been the jackpot number on a Wednesday between August 23, 1985, and October 9, 1985, would plaintiff be required to return the money since, as he claims, he had contracted for fifty-two consecutive Saturday drawings? Would his co-winners be entitled to maintain a suit to exclude plaintiff from the jackpot prize? We ask these questions rhetorically to point out the problem with plaintiff’s interpretation of the contract.
We affirm the lower court’s summary disposition in this matter in favor of the defendant bureau. | [
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R. M. Maher, P.J.
Plaintiffs appeal as of right from the order of the Calhoun Circuit Court dismissing their claims against defendants estate of Dr. Raymond Ruberg, deceased, and Raymond L. Ruberg, D.O., P.C., and referring the matter to arbitration. We reverse.
On April 5, 1982, plaintiff Clinton Smith was admitted into Lakeview General Hospital to undergo a surgical procedure known as a cervical laminectomy. The operation was to be performed the next day by Dr. Ruberg. Upon his admission, Smith signed an arbitration agreement with the hospital. Dr. Ruberg was not a party to that agreement and apparently did not execute an agreement of his own. Following the surgery, Smith developed cervical radiculitis, which he claims rendered him permanently and partially disabled.
On March 30, 1984, Smith and his wife filed a medical malpractice claim against the estate of Dr. Ruberg (the doctor passed away approximately one and a half years after performing the operation), the doctor’s private corporation, and Lakeview General Hospital. The complaint alleged, among other things, that Dr. Ruberg was an employee of the hospital.
On November 20, 1986, the hospital filed a motion for summary disposition or, in the alternative, to compel arbitration. The other defendants filed a similar motion several days later.
A hearing on the motions was held on December 1, 1986, during which the plaintiffs stipulated to dismissal of the hospital with prejudice. At the conclusion of the hearing, the circuit court granted the other defendants’ motion for arbitration. The court reasoned that those defendants could compel arbitration by virtue of the binding agreement between Smith and the hospital. After a later hearing to resolve disputes over the contents of the proposed orders, the court entered orders (1) dismissing plaintiffs’ claim against the hospital and striking allegations in the complaint that Dr. Ruberg was a hospital employee, and (2) referring plaintiffs’ claim against the other defendants to arbitration. It is from the second order that plaintiffs claim their appeal as of right.
The sole issue presented on appeal is whether a defendant in a medical malpractice action who has no standing to compel arbitration in his own right may nevertheless obtain arbitration by virtue of an agreement between the plaintiff and another defendant where that defendant is no longer a party to the proceedings. Resolution of this issue, which is one of first impression in this state, is dependent upon the proper construction of MCL 600.5046(4); MSA 27A.5046(4). That statutory section provides:
A person who is not a party to the arbitration agreement may join in the arbitration at the request of any party with all the rights and obligations of the original parties. Each party to an arbitration under this chapter is deemed to be bound by the joinder of a new party.
Applying rules of simple statutory construction, we can only conclude that the circuit court erred in granting defendants’ motion for arbitration.
When statutory language is clear and unambiguous, judicial interpretation to vary the plain meaning of the statute is precluded. The Legislature must have intended the meaning it plainly expressed, and the statute must be enforced as written. Hiltz v Phil's Quality Market, 417 Mich 335, 343; 337 NW2d 237 (1983); Nerat v Swacker, 150 Mich App 61, 64; 388 NW2d 305 (1986), lv den 426 Mich 857 (1986). Here, the language of MCL 600.5046(4); MSA 27A.5046(4) is clear and unambiguous: "A person who is not a party to an arbitration agreement may join in the arbitration at the request of any party (Emphasis added.) Absent a request, the statute does not grant a nonparty any right to compel arbitration. Since defendants were not invited to join in arbitration, and do not claim any independent right to arbitration, the circuit court erred as a matter of law in granting their motion for arbitration. Reversed and remanded for further proceedings.
Cervical radiculitis is an inflammation of the roots of the cervical spinal nerves as they emerge from the spinal cord. 3 Schmidt, Attorneys’ Dictionary of Medicine (1986), pp R-6 — R-7.
Defendants do not dispute that there was no arbitration agreement between Smith and Dr. Ruberg. Nor do they claim that Dr. Ruberg was an employee of the hospital, thus entitling them to take advantage of that agreement. Even if made, such a claim would be meritless since the circuit court found — and they did not challenge— that the doctor and hospital did not have an employer-employee relationship. | [
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Per Curiam.
Defendant appeals from an order of summary disposition, entered pursuant to MCR 2.116(I)(2), in favor of plaintiff on her claim against defendant under a fire insurance policy.
Plaintiff’s home was damaged by fire on January 24, 1984, resulting in plaintiff’s filing the instant claim of loss with defendant. Defendant denied the claim; plaintiff responded by filing a proof of loss and demand for appraisal.. Defendant still did not honor the claim and did not appoint an appraiser, causing plaintiff to file the instant lawsuit in March, 1985. In answer to the complaint, defendant denied breaching the insurance contract and asserted as an affirmative defense that plaintiff had failed to properly document her claim. The remainder of the house was demolished on January 31, 1986, by order of the township, which had delayed the demolition of the house for two years to give the parties an opportunity to resolve the matter and possibly rebuild the house. On February 12, 1986, twenty-five months after the fire and two weeks after the house was demolished, defendant forwarded $30,000 to plaintiff, representing $20,000 for the structure and $10,000 for contents.
On August 19, 1986, the appraiser filed a notice of appraisal which concluded that the replacement cost value of the house was $52,445 and the actual cost value was $44,578.55. Defendant filed a mo tion to set aside or modify the appraisal award because of errors in the calculation of the award, with the trial court denying that motion.
Defendant thereafter sent a letter to plaintiffs attorney asking that he confirm a remaining balance of $55,145.05 owing to plaintiff, which included replacement costs. Plaintiffs attorney replied that that was incorrect because the total amount owing, including replacement costs, was $63,011.50. Plaintiff offered to forgo any prejudgment interest if defendant paid the replacement cost immediately.
On November 19, 1986, defendant filed a motion to enforce the appraisal award and plaintiff replied with a cross-motion for summary disposition. Following the hearing on the motion, the trial court concluded that plaintiff was due replacement cost value even though she did not repair, replace or rebuild her house in accordance with policy requirements because defendant’s delay had made it impossible for plaintiff to comply with the policy provisions. The trial court found it inequitable to penalize the plaintiff when defendant’s twenty-five month delay in paying any substantial amount prevented plaintiff from rebuilding her house. The trial court further found that defendant should pay prejudgment interest because plaintiff was forced to file suit to collect on her claim.
On December 22, 1986, an order of summary disposition was entered in accordance with the above rulings and defendant paid plaintiff $55,145.05 in partial satisfaction of the judgment. The remaining $7,866.45 of the judgment represents the difference between replacement cost value and actual cost value of the property.
Defendant first argues that the trial court erred in awarding plaintiff the replacement cost of her damaged property when plaintiff failed to repair, rebuild or replace her home. "Replacement cost” policies are permitted by statute, but the statute requires the repair or replacement of the damaged property. MCL 500.2826; MSA 24.12826 provides as follows:
Riders and endorsements may, in consideration of adequate premium or premium deposit, be added to the standard fire insurance policy, insuring property, whereby the insurer agrees to reimburse and indemnify the insured for the difference between the actual value of the insured property at the time any loss or damages' occurs, and the amount actually expended to repair, rebuild or replace with new materials of like size, kind and quality, but not to exceed the amount of liability covered by the riders or endorsements, such property as has been damaged or destroyed by fire or other perils insured against, except that there shall be no liability by the insurer under the terms of said riders or endorsements to pay the amount specified in the riders or endorsements unless the property damaged is actually repaired, rebuilt or replaced at the same or another site.
Consistent with the statute, the insurance policy at issue in the case at bar provides in pertinent part as follows:
3. Loss Settlement.
a. Except as stated in Item b, covered loss to buildings under Coverages A and B will be settled at replacement cost without deduction for depreciation.
(1) Settlement under replacement cost will not be more than the smallest of the following:
(a) the limit of insurance under this policy applying to the building.
(b) the replacement cost of that part of the building damaged for equivalent construction and use on the same premises.
(c) the amount necessarily spent to repair or replace the building intended for the same occupancy and use.
(2) When the cost to repair or replace is more than $1,000 or more than 5% of the limit of insurance in this policy on the building, whichever is less, we shall pay no more than the actual cash value of the damage until repair or replacement is completed.
(3) At your option, you may make a claim under this policy on an actual cash value basis for loss or damage to buildings. Within 180 days after loss you may make a claim for any additional amount on a replacement cost basis if the property has been repaired or replaced.
b. Covered loss to the following types of property will be settled at actual cash value. Payments will not exceed the amount necessary to repair or replace the damaged property, or the limit of insurance applying to the property, whichever is less.
(1) personal property and structures that are not buildings.
(2) carpeting, including wall to wall carpeting, domestic appliances, awnings, outdoor equipment and antennas, all whether or not attached to building.
The interpretation of this fire insurance policy provision is an issue of first impression in Michigan. However, the issue has been considered in other jurisdictions. Specifically, the trial court relied upon Zaitchick v American Motorists Ins Co, 554 F Supp 209 (SD NY, 1982). In Zaitchick, the defendant insurance company refused to pay a fire insurance claim because it suspected the plaintiff of arson and because it claimed that the plaintiff made an exaggerated claim. The trial court found that the defendant had not sustained its burden of proof with regard to the arson charges or the charge of exaggerated claims. Id. at 215. In finding that replacement cost value was the appropriate measure of damages, instead of actual cost value, the court stated:
I find that both case law and equitable considerations render replacement cost the appropriate method of valuing plaintiffs’ damages. The defendant does not challenge the plaintiffs’ contention that a bank would be chary to lend money on the basis of an unlitigated law suit in which the defendant and its vast resources intend to present several defenses to payment. Nonetheless, defendant asserts, case law precludes plaintiffs’ recovery of replacement value, citing American Universal [Ins Co v Falzone, 644 F2d 65 (CA 1, 1981); Rolls v Aetna Casualty & Surety Co, 503 F2d 569 (CA 8, 1974); Lerer Realty Corp v MFB Mutual Ins Co, 474 F2d 410 (CA 5, 1973); Bourazak v North River Ins Co, 379 F2d 530 (CA 7, 1967); Higgins v Ins Co of North America, 256 Or 151; 469 P2d 766 (1970)]. These cited cases, however, are distinguishable from the instant case. In all the relevant cases cited by defendant save Lerer Realty, the defendant paid actual cash value, and was only litigating the issue of whether additional monies would be due under the relevant replacement cost contract provisos. Thus plaintiffs in the cited cases had at least' some money with which to begin rebuilding their property.
The language of the Zaitchicks’ insurance contract also supports my emphasis on whether cash value has been paid or not. The contract states that "[t]he Named Insured may elect to disregard this [replacement cost] condition in making claim hereunder, but such election shall not prejudice the Named Insured’s right to make further claim within 180 days after loss for any additional liability [for replacement cost].” Defendant’s Exhibit M, "Additional Conditions,” ¶ 1(f). In other words, insureds can obtain the necessary funds to begin rebuilding their home, and subsequently upon completion of the construction, obtain additional amounts up to the replacement value. In the in stant case, plaintiffs were refused any monies under the insurance contract. Not surprisingly, they were unable to replace their home. This conduct by defendant made it impossible for plaintiffs to fulfill the condition precedent, and therefore, excuses plaintiffs from performance of the replacement condition. [554 F Supp 217.]
While Zaitchick is foreign law, the concept of not permitting an insurance company to benefit from its own misdeeds is not foreign to the jurisprudence of this state. In Wendt v Auto-Owners Ins Co, 156 Mich App 19, 27-28; 401 NW2d 375 (1986), which considered a somewhat different question than that presented in the case at bar, this Court held that an insurance company is liable for its conduct and may suffer a pecuniary loss as a result of that conduct even where a loss would not ordinarily be imposed by statute:
We see no reason to hold an insurer less accountable for its actions than another contracting party. Consequently, we hold that the breach of an insurer’s obligation to process a claim in good faith renders an insurer liable for pecuniary losses which are not otherwise compensated for by statute.
In the instant case, defendant impeded any progress in this matter by refusing to deal with plaintiff prior to her contacting an attorney, by failing to appoint an appraiser after plaintiff’s attorney requested they do so and by forcing plaintiff to bring this law suit. Defendant failed to make any substantial payment to plaintiff until twenty-five months after the fire. Defendant does not even argue any good faith defenses to its actions of delay. At most, in its answer to plaintiff’s complaint, defendant asserted as an affirmative defense that plaintiff failed to provide proper docu mentation of her loss. Defendant does not argue this defense on appeal. We conclude that, in the face of such lack of good faith processing of plaintiffs claim, the trial court correctly chose to award the replacement cost value to plaintiff based upon equitable considerations.
In short, defendant’s failure to pay on the claim hindered, and quite possibly even prevented, plaintiff from complying with her obligation to repair or replace the building. Had defendant immediately paid in good faith the actual cash value of the loss, holding the additional amount due under the replacement cost provision in reserve until the replacement was made or contracted for, or had otherwise worked with plaintiff to insure her financial ability to immediately proceed with the replacement or repair, a different/ result might be called for. However, defendant did not work with plaintiff to promptly pay the claim and enable her to repair or replace the building; rather, it did as much as possible to hinder plaintiff and delay or prevent the payment of the claim. We will not now allow defendant to raise as a defense plaintiffs failure to perform an act which defendant itself greatly hindered plaintiff from performing. See Woody v Tamer, 158 Mich App 764, 772; 405 NW2d 213 (1987) (where a duty to perform has been rendered impossible, the failure to perform the duty is not a breach of contract).
For the above-stated reasons, we conclude that the trial court properly determined that plaintiff was excused from performing her obligation under the policy to repair or replace the building due to defendant’s dilatory tactics.
Defendant also argues that the trial court improperly awarded prejudgment interest. The trial court properly awarded prejudgment interest. See Linford Lounge, Inc v Michigan Basic Property Ins Ass’n, 77 Mich App 710, 713-714; 259 NW2d 201 (1977).
Affirmed. Plaintiff may tax costs in this Court.
This was in addition to the $4,478.50, of which $3,630 was for living expenses, $600 for contents and $248.50 for replacement of the home, which defendant had previously paid plaintiff prior to the institution of the lawsuit. | [
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Per Curiam.
Plaintiff appeals as of right from a July 24, 1986, order granting summary disposition in favor of defendants on the basis that plaintiff’s claims for breach of her employment contract and breach of her union’s duty of fair representation were barred by the six-month statute of limitation found in the public employment relations act, MCL 423.216(a); MSA 17.455(16)(a). Plaintiff also appeals from a September 12, 1986, order which denied her motion for leave to amend the judgment or for reconsideration. We affirm.
Plaintiff, Audrey Leider, was a schoolteacher in defendant school district and a member of defendant teachers’ union, Fitzgerald Education Association. On November 9, 1982, plaintiff filed a complaint alleging inter alia that she was wrongfully laid off by the school district and the teachers’ union failed to properly represent her.
Regarding her wrongful layoff claim, plaintiff alleged that, pursuant to the collective bargaining agreement which had been ratified by the membership, its terms could only be changed or amended after further ratification by the membership. Plaintiff contended that the agreement provided that teachers had to be notified of layoffs by May of each year. She alleged that the union and school board wrongfully agreed to change the express date to a later date without first obtaining ratification from the membership and that, when she was subsequently laid off, she suffered damages by this unauthorized amendment to the collective bargaining agreement. In addition, she alleged that the union was bound to process a grievance on her behalf concerning what she described as the breach of contract on the part of the union and the board of education.
On January 6, 1983, defendants moved for accelerated judgment under GCR 1963, 116. In their motion, defendants alleged that the matters complained of in plaintiffs complaint were within the exclusive jurisdiction of the Michigan Employment Relations Commission, and that plaintiff had not exhausted her administrative remedies. The trial court agreed with defendants. Plaintiff appealed that decision. This Court reversed the trial court, relying on Demings v City of Ecorse, 127 Mich App 608; 339 NW2d 498 (1983), and held that plaintiff did not have to exhaust her merc remedies before filing a fair representation suit in court, and that the merc did not have exclusive jurisdiction in fair representation cases. Leider v Fitzgerald Ed Ass'n, unpublished opinion per curiam of the Court of Appeals, decided September 10, 1984 (Docket No. 70749).
Defendants filed an application for leave to appeal this Court’s September 10, 1984, decision to the Supreme Court on October 1, 1984. In the interim, the Supreme Court granted leave to appeal in Dealings to decide whether the merc has exclusive jurisdiction over fair representation claims. 419 Mich 942 (1984).
Pending the outcome of Demings, the Supreme Court held in abeyance defendants’ application for leave to appeal in Leider.
The Supreme Court decided Demings on November 7, 1985, and held that the merc does not have exclusive jurisdiction of fair representation claims arising under pera. Demings v City of Ecorse, 423 Mich 49, 68; 377 NW2d 275 (1985).
On March 18, 1986, the Supreme Court denied defendants’ application for leave to appeal. 424 Mich 897 (1986). This case was then remanded to the circuit court for trial in accordance with this Court’s September 10, 1984, opinion.
Subsequently, on April 4, 1986, defendants moved for summary disposition under MCR 2.116(C)(7), alleging inter alia that plaintiffs complaint, filed on November 9, 1982, is barred by the six-month statute of limitation in pera.
In a July 24, 1986, opinion and order, the trial court granted defendants summary disposition. The trial judge ruled that plaintiff was a public employee subject to the six-month statutory period prescribed in pera, MCL 423.216(a); MSA 17.455(16)(a).
On August 8, 1986, plaintiff filed a motion for reconsideration. Subsequently, on August 25, 1986, plaintiff filed an amended motion for reconsideration and to amend the judgment. On September 12, 1986, the trial court denied both of plaintiffs motions. Plaintiff appealed from the July 24, 1986, order granting summary disposition in favor of defendants and the September 24, 1986, order denying her motions. Defendants moved in this Court to dismiss plaintiffs appeal on the basis that her motion to amend was untimely under MCR 2.119(F) and MCR 2.611(B). This Court denied defendants’ motion.
The first issue for our determination is whether the six-month statute of limitation as found in pera, MCL 423.216(a); MSA 17.455(16)(a), applies to a claim for breach of a union’s duty of fair representation. MCL 423.216; MSA 17.455(16) provides in part:
Violations of the provisions of section 10 shall be deemed to be unfair labor practices remediable by the commission in the following manner:
(a) Whenever it is charged that any person has engaged in or is engaging in any such unfair labor practice, the commission, or any agent designated by the commission for such purposes, may issue and cause to be served upon the person a complaint stating the charges in that respect, and containing a notice of hearing before the commission or a commissioner thereof, or before a designated agent, at a place therein fixed, not less than 5 days after the serving of the complaint. No complaint shall issue based upon any unfair labor practice occurring more than 6 months prior to the filing of the charge with the commission and the service of a copy thereof upon the person against whom the charge is made ....
Initially, we must decide whether a breach of a union’s duty of fair representation constitutes an unfair labor practice within the meaning of the foregoing provision of the pera. Section 10 of the act, MCL 423.210; MSA 17.455(10), designates certain practices as unfair labor practices. Section 10(3) makes it unlawful for a union to restrain or coerce a public employee in the exercise of his right to organize and engage in concerted activity. A bargaining representative’s breach of the duty of fair representation, such as a wrongful failure to pursue a member’s grievance, is an unfair labor practice under § 10(3). See Profítt v Wayne-Westland Community Schools, 140 Mich App 499; 364 NW2d 359 (1985), vacated on other grounds 424 Mich 868 (1986); Demings v City of Ecorse, 127 Mich App 608, 617-618; 339 NW2d 498 (1983), aff'd 423 Mich 49; 377 NW2d 275 (1985); Harris v Amalgamated Transit Union, 122 Mich App 706; 333 NW2d 1 (1982). It is also considered an unfair labor practice under the National Labor Relations Act, 29 USC 159, because it may result in employees’ unwillingness to participate in the union, thereby restraining their right to engage in protected concerted activity. Local Union No 12, United Rubber, Cork, Linoleum & Plastic Workers of America, AFL-CIO v National Labor Relations Bd, 368 F2d 12 (CA 5, 1966), cert den 389 US 837; 88 S Ct 53; 19 L Ed 2d 99 (1967).
Under the statute, unfair labor practice claims are subject to the six-month statute of limitation period. MCL 423.216(a); MSA 17.455(16)(a). Because a breach of the duty of fair representation constitutes an unfair labor practice, Profitt, supra; Demings, supra; and Harris, supra, the six-month period governs the instant complaint even though plaintiff attempts to argue for a three-year statutory limitation period on the basis that she is alleging a "common-law” breach of the duty of fair representation. Such arguments have been rejected by other panels of this Court. See Carlson v North Dearborn Heights Bd of Ed, 157 Mich App 653, 662-663; 403 NW2d 598 (1987), and Ray v Organization of School Administrators & Supervisors, Local 28, AFL-CIO, 141 Mich App 708, 710-711; 367 NW2d 438 (1985).
In the trial court’s opinion and order granting summary disposition in favor of defendants, the court determined that the internal grievance procedure continued until May 18, 1982. The statute was tolled until that time. Plaintiffs complaint, filed on November 23, 1982, was thus untimely since the six-month limitation period had already expired.
Plaintiffs second claim on appeal deals with whether the trial judge erred in ruling that plaintiff delayed past the seven days within which a motion for reconsideration is required to be filed under MCR 2.119(F), and that she also delayed beyond the twenty-one days within which a motion to amend a judgment is required to be filed pursuant to MCR 2.611(B). We conclude that no error occurred in the trial court’s rulings on both of these claims.
MCR 2.119(F)(1) provides:
Any motion for rehearing or reconsideration of the decision on a motion must be served and filed not later than 7 days after entry of the order disposing of the motion.
On July 29, 1986, the trial court filed its opinion and order of July 24, 1986, granting summary disposition in favor or defendants. Plaintiffs motion for reconsideration was filed on August 8, 1986. Plaintiffs motion was untimely under MCR 2.119(F)(1) since it was filed later than seven days after entry of the trial court’s opinion and order. Thus, the trial court correctly denied plaintiffs motion for reconsideration on the basis of untimeliness.
MCR 2.611(B) requires a motion to amend a judgment to be filed and served within twenty-one days after entry of the judgment. In this case, plaintiff moved to amend the judgment on August 22, 1986. Plaintiff delayed some twenty-nine days after the entry of the court’s July 24, 1986, opinion and order. Thus, her motion was untimely and the trial court correctly denied it.
Affirmed.
MCL 423.210(3); MSA 17.455(10(3), states in part:
It shall be unlawful for a labor organization or its agents (a) to restrain or coerce: (i) public employees in the exercise of the rights guaranteed in section 9:. . . .
Section 9, MCL 423.209; MSA 17.455(9), provides:
It shall be lawful for public employees to organize together or to form, join or assist in labor organizations, to engage in lawful concerted activities for the purpose of collective negotiation or bargaining or other mutual aid and protection, or to negotiate or bargain collectively with their public employers through representatives of their own free choice. | [
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Per Curiam.
Defendant was charged with five counts of criminal sexual conduct in the first degree, MCL 750.520(b); MSA 28.788(2). Following a preliminary examination on December 18, 1986, defendant was bound over for trial on all five counts. Defendant’s subsequent motion to quash Counts i, iv and v was denied by the circuit court. It is from this order that defendant sought and was granted permission to bring this interlocutory appeal. We affirm in part and reverse in part.
The facts as adduced at the preliminary examination are as follows. On June 9, 1986, Brenda Barron and Johnny Ochalick picked up a three-year-old girl and took her to the Barron home to spend the night. Ochalick testified that defendant was left alone for about four to five hours to babysit his son, the three-year-old girl, and two other girls, ages five and six.
The three-year-old’s mother testified that the following day she drove to the Barron home to pick up her daughter. On the way home, the child complained of pain in her vaginal and rectal areas. The mother examined the child and found the vaginal area red and swollen.
The three-year-old girl testified that she knew "Pa Paw” Frank (defendant) and identified him in court stating, "I don’t like him.” The child indicated that defendant touched her with his tongue in her mouth and vagina by pointing to those areas. The child was given two anatomically correct dolls with their clothes removed. When asked where Pa Paw put his "tu-tu” (penis), the child pointed to the vagina and rectum of the female doll. The child stated that defendant put his penis in her mouth. The child also testified that she saw defendant "do something” to the other girls.
Dr. Ethelene C. Jones, a board certified obstetrician/gynecologist, testified that she examined the three-year-old girl on July 2, 1986, and found evidence of healed tears in the vaginal area as well as lacerations in the perianal area. Based on her experience with sexually abused children, the doctor opined that the child had been sexually penetrated.
Dr. Jones also examined both the five-year-old and six-year-old girls on July 30, 1986, and in both cases found indications that the children had been sexually penetrated. However, the doctor was unable to establish a time frame as to when the sexual abuse occurred for any of the three children.
Defendant was then charged as follows:
Count i alleged defendant engaged in sexual penetration with the five-year-old girl on June 9, or 10, 1986. Counts ii, m and iv allege defendant engaged in sexual penetration with the three-year-old girl; Count n, cunnilingus; Count hi, fellatio; and Count iv, sexual penetration. Count v alleged defendant engaged in sexual penetration with the six-year-old girl.
At the preliminary examination, defendant moved to have Counts i and v dismissed as neither the five-year-old girl nor the six-year-old girl testified and Dr. Jones’ opinion that the girls had been penetrated was not only improper but insufficient to make out the legal elements of first-degree criminal sexual conduct. Defendant also moved for dismissal of Counts n, in and iv, on the basis that the three-year-old girl’s testimony was contradictory and the doctor’s testimony was improper as to the crucial issue of whether an actual rape occurred at a specific time and place. The court, finding the requisite quantum of evidence, bound defendant over on all five charges.
Thereafter, defendant brought a motion to quash Counts i, iv and v. Following a hearing on February 23, 1987, the circuit court concluded that the magistrate had not abused his discretion in binding defendant over on these counts and, thus, defendant was to be tried on all five counts of first-degree criminal sexual conduct.
Defendant argues on appeal as he did below that the magistrate abused his discretion in binding defendant over on Counts i, iv and v as listed on the information. We find no abuse of discretion by the magistrate in binding defendant over on Count iv. However, we conclude that Counts i and v, as to the five-year-old girl and the six-year-old girl, respectively, should have been dismissed.
It is the duty of the magistrate to bind a defendant over for trial if it appears at the conclusion of the preliminary examination that a crime has been committed and there is probable cause to believe that the defendant committed it. MCL 766.13; MSA 28.931; People v Dyer, 157 Mich App 606, 608; 403 NW2d 84 (1986), and cases cited therein. Probable cause is defined as a "reasonable ground of suspicion, supported by circumstances sufficiently strong in themselves to warrant a cautious man in the belief that a person accused is guilty of the offense with which he is charged.” People v Dellabonda, 265 Mich 486, 490; 251 NW 594 (1933). Positive proof of guilt is not required, only that there must be some evidence on each element of the crime charged, or evidence from which these elements may be inferred. People v Irby, 129 Mich App 306, 321; 342 NW2d 303 (1983).
In reviewing the decision of a magistrate to bind over an accused person, the reviewing court will not substitute its judgment for that of the magistrate. His decision will be reversed only if it appears on the record that there has been a clear abuse of discretion. People v Talley, 410 Mich 378, 385; 301 NW2d 809 (1981); People v Scurry, 153 Mich App 437, 439; 395 NW2d 342 (1986).
The instant complaint alleges that defendant engaged in sexual penetration with the five-year-old girl (Count i), the three-year-old girl (Count iv) and the six-year-old girl (Count v). MCL 750.520b(1)(a); MSA 28.788(2)(1)(a) provides:
Sec. 520b. (1) A person is guilty of criminal sexual conduct in the first degree if he or she engages in sexual penetration with another person and if any of the following circumstances exists:
(a) That other person is under 13 years of age.
Section 520a, as used in section 520b, defines "sexual penetration”:
(1) "Sexual penetration” means sexual intercourse, cunnilingus, fellatio, anal intercourse, or any other intrusion, however slight, of any part of a person’s body or of any object into the genital or anal openings of another person’s body, but emission of semen is not required. [MCL 750.250a(1); MSA 28.788(1)0).]
We have reviewed the preliminary examination transcript and find that the evidence adduced was sufficient to establish penetration with respect to the three-year-old girl. Although she did not specifically testify to penetration, we find that her testimony, coupled with that of her mother, John Ochalick and Dr. Jones, was sufficient to bridge the gap between the testimony of the child and proof of the act of penetration. People v Callahan, 152 Mich App 29, 32; 391 NW2d 512 (1986). Specifically, the child testified, with the aid of anatomically correct dolls, that defendant inserted his penis into her vagina:
Q. Can you show me with the doll? Show me with the doll. Where did Pa Paw Frank put his tutu (penis)?
A. Right there.
Ms. Diehl [Prosecutor]: All right. For the record indicating doll’s vagina.
The Witness: Right here.
Ms. Diehl: Indicating the doll’s rectum.
In addition, the three-year-old child’s mother testified that her daughter complained of pain in her vaginal area which she found to be red and swollen. Significantly, the alleged incidents took place while defendant was alone with the children for approximately four to five hours.
Dr. Jones testified that the physical examination revealed healed tears in the vaginal area as well as lacerations and signs of chronic irritation in the perianal area. In the doctor’s opinion, the three-year-old child had been sexually penetrated.
We find that this evidence, albeit circumstantial, was sufficient to warrant the inference that defendant penetrated the three-year-old child. Consequently, we find no abuse of discretion in binding defendant over on Count iv.
However, we do not reach a similar conclusion with respect to Counts i and v which alleged sexual penetration of the five-year-old girl and the six-year-old girl. At the preliminary examination, neither of these girls testified. The only testimony relative to these charges was elicited from the three-year-old girl and Dr. Jones. Dr. Jones testified that, after examining both the five-year-old girl and the six-year-old girl, it was her opinion that each girl had been sexually penetrated. With respect to the three-year-old girl, her testimony was vague and inconclusive:
Q. [D]id you see Pa Paw Frank do anything to [the five-year-old girl]?
A. Yes.
Q. What did you see Pa Paw Frank do to [her]? Will you tell me?
A. (No response)
Q. Did you see Pa Paw Frank do something to [the six-year-old girl]?
A. Yes.
Q. Will you tell me what you saw him do to [her]?
A. He just — he just pointed at me.
Q. Who pointed at you? Pa Paw Frank did?
In addition to arguing that the court abused its discretion in binding defendant over on these charges, defendant also claims that the examining physician, Dr. Jones, was improperly allowed to give expert opinion testimony as to the crucial issue whether the five-year-old girl and the six-year-old girl were actually raped at a specific time and place.
In a criminal sexual conduct case, an examining physician’s testimony is admissible for the limited purposes of establishing penetration or penetration against the will of the victim. People v Naugle, 152 Mich App 227, 236; 393 NW2d 592 (1986). If a victim has had intercourse following the alleged assault but prior to the medical examination, the physician is not qualified to give an opinion whether the victim was assaulted on the alleged date unless a proper foundation has been established. Id., and cases cited therein.
Our review of the transcript confirms the trial court’s conclusion that Dr. Jones’ testimony was confined to the issue of whether penetration occurred. Dr. Jones did not express an opinion as to a place, specific time or by whom the rape occurred. Furthermore, the doctor’s opinion was grounded upon objective evidence within the realm of her expertise as an obstetrician/gynecologist. Cross-examination was available and used. We find no error in the trial court’s determination that this testimony was admissible. MRE 702; see People v Smith, 425 Mich 98; 387 NW2d 814 (1986).
Although proper, we find that this testimony, at most, only established that a crime had been committed. It was insufficient, however, to establish probable cause to believe that defendant had engaged in sexual penetration with either of the girls.
Neither the five-year-old girl nor the six-year-old girl testified at the preliminary examination and the three-year-old girl’s testimony indicated only that she saw defendant "do something.” The strongest evidence of penetration was from Dr. Jones who only stated that the injuries were compatible with penetration. Clearly, this does not support a reasonable inference that there had been penetration of either child by defendant.
Accordingly, we find that the magistrate abused his discretion in binding defendant over for trial on Counts i and v.
Affirmed with respect to Count iv. Counts i and v should be dismissed.
Defendant does not challenge his bindover on Counts n and in. Accordingly, he must stand trial on these charges as well. | [
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H. Hood, J.
On April 9, 1986, the trial court granted the parties a divorce. The parties had been married for twenty-eight years. The court essentially divided the marital property equally between the parties. On appeal, defendant challenges the court’s division of plaintiffs vested contributory pension from Ford Motor Company, where plaintiff has worked since 1957.
According to both parties, plaintiff has a vested contributory pension which entitles him to $376.16 per month at age sixty-five, and a vested noncontributory pension which entitles him to $604.15 at age sixty-five. These figures are found in a letter from the Ford Motor Company Pension Department dated February 27, 1985, and attached to both appellate briefs. However, a review of the record indicates that evidence of the present value of the pensions was not introduced at trial. Following defendant’s testimony, counsel for defendant stated he had an accountant who was going to testify as to the present value of the pensions. However, the accountant was not yet in the courtroom. The court refused to wait for the accountant, noting that defendant failed to inform plaintiff that the accountant was going to testify.
The trial court expressed its exasperation over the limited record:
This pension is the whole issue in this case, as I understand it, and neither one of you have got any concrete evidence by people under oath here or by stipulation from which I can reach a judgment on it.
In dividing the property, the court stated: "The court makes no distribution of the noncontributory one since it has no viable figures here with which to work.” While that statement is true, it is also true that the court had no figures to be able to arrive at a value of the contributory plan. Nevertheless, it made a distribution of that plan by giving defendant one-half of the unspecified value.
The judgment of divorce itself divided only the contributory pension and reflects the fact that the trial court had little information to work with in dividing the pensions:
(9) The plaintiff shall pay to the defendant one-half of the value of the plaintiff’s contributory pension plan with the Ford Motor Company. The plaintiff shall hold the remainder of his pension, both the contributory and the non-contributory share of his sole and separate property free of any claim, right, title or interest of the defendant therein.
Defendant was awarded $100 per week in alimony.
On appeal, defendant first argues that the trial court erred in not making a finding as to the specific value of the contributory pension plan. Defendant requests remand to the trial court for the court to take testimony as to the present value of the contributory pension plan and to make an equitable award of a portion of the pension. We agree that the trial court erred in not making a finding of fact as to the present value of the pension. Such a finding is required by MCR 2.517(A). However, on appeal, plaintiff claims he has provided an accounting and has paid over to defendant half the proceeds. We feel that remand is appropriate. Upon remand, the trial court is to determine whether plaintiff has correctly calculated and paid over to defendant one-half of the value of the contributory pension. We note the dearth of proofs at the trial as to the value of the pension. The court may wish to hear further proofs on the value or may wish to accept plaintiff’s accounting. In any event, the trial court is to determine whether plaintiff has abided by its order to pay defendant one-half of the value of plaintiff’s contributory pension plan.
Next, defendant claims that the court erred in not awarding her a portion of plaintiffs noncontributory pension. The party seeking to include a pension in the marital estate bears the burden of proving a reasonably ascertainable value; if the burden is not met, the interest should not be considered an asset. Miller v Miller, 83 Mich App 672, 677; 269 NW2d 264 (1978). In the instant case, defendant did not bear her burden of ascertaining the value, as defendant submitted no evidence through an actuary or accountant as to the value. Nor did defendant’s attorney use the valuation method set forth in Boyd v Boyd, 116 Mich App 774; 323 NW2d 553 (1982).
Defendant relies on Perry v Perry, 133 Mich App 453; 350 NW2d 275 (1984). In Perry, the defendant husband had a noncontributory pension, and no attempt was made at trial by either party to place a present value on it. In the property settlement, the court split all the assets equally, but awarded defendant’s pension entirely to the defendant. However, the court stated that its award of substantial alimony was in place of an award to the plaintiff of a portion of the pension. Perry, supra, p 456. This practice of awarding substantial alimony in place of a portion of the pension is allowed. Boyd, supra, p 783. The defendant appealed from the alimony award, and this Court remanded for the trial court to take testimony as to the present value of the pension and to apply equitable principles in setting the alimony in lieu of an award of the pension. Perry, supra, p 460.
In Perry, this Court, noting the trial court’s decision to award alimony in place of a portion of the pension, remanded for a determination of the present value of the pension. In the instant case, the trial court did not state that it was awarding alimony in lieu of a portion of defendant’s noncontributory pension. The court merely stated it was not awarding a portion of the noncontributory pension because defendant did not present proofs as to its present value. Because defendant did not provide figures on the present value, the court was not obliged to award defendant a portion of the pension. Miller, supra, p 677.
Perry does not stand for the proposition, as defendant would like it to, that in all instances where no testimony is offered on the present value of a pension and no award of the pension is made, a remand is required for a determination of the present value of the pension and an award of the pension. Defendant cites no authority for the proposition that a noncontributory pension must be divided among the parties whenever one exists. This is not the law.
Defendant requests remand for the trial court to take testimony as to the present value of the noncontributory pension and to make an award of a portion of the pension. We decline to reward defendant’s failure to produce evidence at trial as to the present value of the noncontributory pension by awarding defendant a second trial. MCR 2.611(A)(1) provides that a new trial may be granted for any of the following reasons:
(a) Irregularity in the proceedings of the court, jury, or prevailing party, or an order of the court or abuse of discretion which denied the moving party a fair trial.
(b) Misconduct of the jury or of the prevailing party.
(c) Excessive or inadequate damages appearing to have been influenced by passion or prejudice.
(d) A verdict clearly or grossly inadequate or excessive.
(e) A verdict or decision against the great weight of the evidence or contrary to law.
(f) Material evidence, newly discovered, which could not with reasonable diligence have been discovered and produced at trial.
(g) Error of law occurring in the proceedings, or mistake of fact by the court.
(h) A ground listed in MCR 2.612 warranting a new trial.
None of these grounds for a new trial exist in the instant case. We note also that the court awarded defendant an ample amount of the marital estate. The court ordered that the parties’ marital home, Grass Lake property, motor home, money market funds, and United States savings bonds be sold and the proceeds divided. In addition, the court awarded defendant half of the parties’ stock, household furnishings, and plaintiff’s contributory pension. The court awarded defendant $100 per week alimony and ordered that plaintiff provide defendant with health care insurance coverage for two years. This Court reviews divorce cases de novo on the record. Hatcher v Hatcher, 129 Mich App 753, 760; 343 NW2d 498 (1983). This Court will not reverse the trial court’s division of property unless it is convinced that it would have reached a different result had it been sitting in the lower court’s position. Id., p 764. The only requirement is that the award result in a fair and equitable distribution. Id., p 767. In the instant case, considering the circumstances and the lack of testimony as to the present value of the noncontributory pension, we feel the trial court fairly distributed the assets. Actually, the court was more than fair, as it awarded defendant a portion of plaintiff’s contributory pension in spite of the fact that defendant presented no testimony as to its present value. As we find the trial court’s property division was fair, we see no reason to remand for a determination of the present value of the noncontributory pension and an award of a portion of it.
The trial court’s decision is affirmed in part and remanded in part, in accordance with this opinion.
T. M. Burns, J., concurred. | [
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Doctoroff, J. Glen Miller
(hereinafter respondent) appeals as of right from an Ingham County Probate Court order permanently terminating his parental rights in his son, Ryan Kyle Dean Miller. MCL 600.861(c)(ii); MSA 27A.861(c)(ii). We reverse.
The minor child, Ryan, was born in August, 1982. At that time, his parents were unmarried and Ryan lived with his mother, Sherry.
In August, 1983, a neglect petition was filed against Sherry on the basis of information reported by Sherry’s mother. Ryan’s first three months of foster care were with Sherry’s mother. The rest of his foster care was with his paternal grandparents.
In June, 1984, respondent and Sherry married. The marriage was tumultuous, and, at the time of the instant permanent termination proceedings, respondent had filed for divorce.
The probate court based its decision to terminate parental rights on MCL 712A.19a(f); MSA 27.3178(598.19a)(f), which provides:
Where a child remains in foster care in the temporary custody of the court following the initial hearing provided by section 19, the court may make a final determination and order placing the child in the permanent custody of the court, if it finds any of the following:
* * *
(f) The child has been in foster care in the temporary custody of the court on the basis of a neglect petition for a period of at least 2 years and upon rehearing the parents fail to establish a reasonable probability that they will be able to reestablish a proper home for the child within the following 12 months.
Respondent’s claim of error is that the evidence did not clearly and convincingly establish that termination of his parental rights was warranted. MCR 5.908(C)(2). See, also, In re Bidwell, 129 Mich App 499, 504; 342 NW2d 82 (1983); In re LaFlure, 48 Mich App 377, 386; 210 NW2d 482 (1973), lv den 390 Mich 814 (1973).
It is the policy of this state to keep children with their natural parents whenever possible. MCL 712A.1; MSA 27.3178(598.1). In re Brown, 139 Mich App 17, 20; 360 NW2d 327 (1984). In termination matters, the standard for proceedings under § 19a is whether the parent has been shown by clear and convincing evidence to be unfit and unable to become fit within a reasonable period of time. In re Atkins, 112 Mich App 528, 541; 316 NW2d 472 (1982), lv den 413 Mich 912 (1982). The burden of going forward with evidence resides with the parents. In re Kantola, 139 Mich App 23, 28; 361 NW2d 20 (1984).
In reviewing a trial court’s findings with respect to the termination of parental rights, this Court employs the clearly erroneous standard of review. In re Irving, 134 Mich App 678, 679-680; 352 NW2d 295 (1984). A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been made. In re Cornet, 422 Mich 274, 278; 373 NW2d 536 (1985); In re Rifle, 147 Mich App 658, 671; 382 NW2d 842 (1985), lv den 424 Mich 904 (1986).
After reviewing the record of the instant proceeding, we are left with the definite and firm conviction that a mistake was made when respondent’s parental rights were terminated.
Respondent proposed a plan whereby he hoped to establish a proper home for Ryan, who the court found had never lived with him other than for brief visits. The plan was that respondent would change work shifts so that he could be home with Ryan during the evenings. He intended to play and watch television with Ryan and also do housework during those times. Although the trial court found that it was speculative as to who would be raising Ryan, respondent indicated that he would ask a neighbor to care for Ryan during the day while he worked. In the fall of 1987, Ryan was to begin school, and respondent would be able to be with him when the school day ended. The court found that respondent had a two-bedroom apartment and a steady full-time job with a good work record, had consistently paid for Ryan’s support, had demonstrated good compliance with court orders, had paid for and attended therapy sessions, and had attended parenting classes and an alcohol education program. Nonetheless, the court found that "there is not evidence that he [respondent] could provide adequately emotionally for Ryan” and that there was no reasonable probability that respondent could provide a proper home for Ryan within the next twelve months. In so finding, the trial court seemed to have reached its decision to terminate respondent’s parental rights by placing great emphasis on two occurrences: a 1984 incident in which respondent disciplined Ryan, and a period from approximately August, 1985, to February, 1986, during which neither respondent nor his wife requested visitation with Ryan.
In 1984, after respondent finished parenting classes for which he received straight a’s, he disciplined Ryan during a visit. The child apparently defecated in his pants, whereupon respondent picked Ryan up by his hair and rubbed the feces on him. The probate court found that respondent had not incorporated what he had learned from the parenting classes into his treatment of Ryan.
Case worker Doris Munro-Sneider testified at the termination proceedings that home visitation was not discontinued after this incident. She continued to meet with respondent and his wife, who were able to verbalize their feelings and vent their frustrations. They could see alternatives to the discipline and were remorseful. Respondent told Munro-Sneider that he had been similarly treated as a child and that his treatment of his son had been done without thinking.
The record is replete with evidence of discord between respondent and his parents, who even requested that visitation between their son and Ryan at their home be discontinued. Although respondent’s therapist, Mary Alice Collins, testified that his relationship with his parents had an impact on what he had done over the last three years, including reliance on disciplining techniques he learned from his parents, she stated that he is making progress. He was identifying his anger, looking at it and adapting ways of dealing with it. Contrary to the probate court’s assertion that there was no evidence that respondent could provide emotional support for his son, Collins had testified that respondent could be an appropriate and effective parent to his son within twelve months with a little more therapy and that he could provide care, financial and emotional support and love and would take an interest in his son’s development.
In addition to emphasizing the disciplining incident, the probate court also emphasized that there had been a period between approximately August, 1985, and February, 1986, during which respondent and his wife did not ask for visitation with Ryan. In approximately July, 1985, respondent and his wife had an altercation. In August, 1985, assault charges were filed against respondent, at which point respondent and his wife were informed that visitation with Ryan would cease. Munro-Sneider retrieved Ryan from his parents at that point. Evidence showed that respondent and his wife thought that, when Munro-Sneider told them that the filing of the charges meant the end of the visits for a while, she meant that there would be no further visits until the matter was ended. After several months, the charges against respondent were dismissed. Respondent’s failure to request visitation can be construed as naivete rather than a lack of caring about Ryan.
We agree with the probate court that this is a sad case and that Ryan needs stability in his life. But the evidence shows that most of the instability and discord was brought about because of the poor relationship that existed between Ryan’s parents, which was aggravated by a number of factors, including the fact that Sherry regularly left home for up to six weeks at a time. Munro-Sneider even testified that, on two occasions, Ryan came close to being reunited with his parents and that the reason he was not so reunited was not the fault of either parent individually, but rather was the result of the fact that his parents could not interact well together.
Based upon the entire evidence, we are left with the definite and firm conviction that a mistake has been made. The probate court faced a very difficult matter. Nonetheless, we are persuaded that its order terminating respondent’s parental rights is not supported by clear and convincing evidence that termination was warranted. Accordingly, we reverse and remand this case.
We note in passing that respondent mother, Sherry Miller, who is not a party to this appeal, appeared at oral argument in this case and notified this Court that she had never received notice of her appellate rights. On remand, the probate court is to determine whether Sherry Miller received such notice.
Reversed and remanded.
J. T. Corden, J., concurred.
The rights of respondent’s wife, Sherry Miller, were terminated at the same proceeding. She has not appealed from the order.
Respondent had previously changed shifts so that he could work during the evenings and be available for court proceedings during the day. | [
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] |
Doctoroff, J.
This appeal involves a contract concerning condominiums that were offered for sale by plaintiff. Plaintiff brought this action for breach of contract of sale of a condominium unit after defendants filed a complaint with the condominium section of the Corporation and Securities Bureau seeking return of $2,600 from plaintiff. Following a bench trial, the trial court found that the parties had an option contract and entered judgment for plaintiff for $2,600, together with costs and interest. Defendants appeal as of right. Plaintiff cross-appeals as of right. We reverse the award of costs, but affirm the judgment in all other respects.
i
The first issue raised in this appeal is whether the trial court’s finding that the parties had entered into an option contract is clearly erroneous. Defendants argue that the $2,600 deposit should be returned to them because the parties’ agreement should be construed to be a preliminary reservation agreement, MCL 559.109(4); MSA 26.50(109)(4). Plaintiff, by cross-appeal, argues that the parties’ agreement constituted an amended purchase agreement, breach of which entitles it to damages as well as to retention of the $2,600 deposit or, alternatively, to specific performance of the agreement.
Findings of fact by the trial court may not be set aside unless clearly erroneous, MCR 2.613(C). A trial court’s finding is clearly erroneous where, although there is evidence to support it, the re viewing court is left with a definite and firm conviction that a mistake has been made. Henderson v Biron, 138 Mich App 503, 507; 360 NW2d 230 (1984), lv den 422 Mich 976 (1985).
The trial court found that, although defendants had originally entered into an agreement to purchase condominium unit No. 104 for $105,500 and deposited both a $5,000 check toward the purchase and a $2,600 check for a built-in vacuum cleaner and entertainment system, they elected to withdraw from the agreement on the following day. They did so without reason or penalty, which they were entitled to do according to the terms of the agreement.
The court further found that approximately four days thereafter defendants retrieved their checks. However, that same day, they tendered a third check to plaintiff for $2,600. Both the original and the duplicate of the purchase agreement were altered by deletion of the unit number, the purchase price, and the $5,000 deposit amount. The amount of $2,600 was then inserted in the deposit amount space.
The trial court, concluding that the agreement failed to satisfy the statute of frauds, MCL 566.106; MSA 26.906, found that the parties had entered into an option agreement.
Pursuant to MCL 559.121(1); MSA 26.50(121)(1), condominiums may only be offered for initial sale in accordance with the Condominium Act unless exempted. The act defines a preliminary reservation agreement as an opportunity to purchase a particular condominium unit for a limited period of time upon sales terms to be later determined, MCL 559.109(4); MSA 26.50(109)(4).
In this case, the contract at issue did not identify a particular unit, and the trial court so found. The contract therefore did not fall under the aegis of a preliminary reservation agreement as defined by the Condominium Act.
Plaintiff asserts on cross-appeal that the agreement between the parties was an amended purchase agreement, breach of which entitles it to retention of the $2,600 as well as to damages or to specific performance.
A conveyance of an interest in land must be in writing and comport with the statute of frauds, MCL 566.106; MSA 26.906. To satisfy the statute of frauds, the writing or memorandum must be certain and definite as to the parties, property, consideration, premises and time of performance. Cooper v Pierson, 212 Mich 657, 660; 180 NW 351 (1920). It must leave no essential element to be supplied by parol. Caughey v Ames, 315 Mich 643, 647; 24 NW2d 521 (1946).
In this case, the contract was never signed or dated by the parties. Additionally, the unit number and price were not indicated. Consequently, the agreement does not comport with the statute of frauds and thus cannot be a purchase agreement.
The court found that the parties had entered into an option agreement that gave defendants the right to purchase property at a fixed price within a specified time.
An option is a preliminary contract for the privilege of purchase and not itself a contract of purchase. Oshtemo Twp v Kalamazoo, 77 Mich App 33, 37; 257 NW2d 260 (1977), lv den 402 Mich 814 (1977). It is a contract collateral to the offer to sell whereby the offer is irrevocable for a specified period. EMU Bd of Control v Burgess, 45 Mich App 183, 186; 206 NW2d 256 (1973), lv den 392 Mich 788 (1974). It involves the privilege of buying property at a fixed price within a specified period of time. Oshtemo Twp, supra, p 37. An option contract does not create an interest in land. Id. Therefore, it is not subject to the statute of frauds.
The trial court’s conclusion that the parties had entered into an option contract and that plaintiff was entitled to an award of $2,600 that represented the consideration for the unexercised option is not clearly erroneous.
ii
Defendants next argue that the trial court erred by failing to find in their favor pursuant to the Michigan Consumer Protection Act, MCL 445.901 et seq.; MSA 19.418(1) et seq. They assert that this act was violated by plaintiffs refusal to return the $2,600 to them because the Condominium Act mandated the return of the deposit within three business days of the cancellation of a preliminary reservation agreement, MCL 559.183(3); MSA 26.50(183)(3).
The Michigan Consumer Protection Act prohibits unfair, unconscionable, or deceptive methods, acts or practices in conduct of trade or commerce, MCL 445.903(1); MSA 19.418(3)(1). Trade or com merce includes real estate transactions under this act, MCL 445.902(d); MSA 19.418(2)(d). The refusal to cancel an agreement and return the deposit when such is required by law constitutes a violation of the act, MCL 445.903(1)(u); MSA 19.418(3)(1)(u).
However, as previously stated, the trial court’s finding that the subject contract was an option contract was not clearly erroneous. Therefore, a violation of the Consumer Protection Act because a preliminary reservation was not cancelled and the deposit was not returned within three business days did not occur, MCL 445.903(1)(u); MSA 19.418(3)(1)(u).
iii
Defendants’ final argument is that the trial court erred by taxing costs against them and also by awarding plaintiff/interest on the judgment. MCR 2.625 provides in relevant part:
Costs will be allowed to the prevailing party in an action, unless prohibited by statute or by these rules or unless the court directs otherwise, for reasons stated in writing and filed in the action.
However, costs are taxed only when a party has prevailed in full. See, e.g., Deziel v Difco Laboratories, Inc, 394 Mich 466; 232 NW2d 146 (1975), app after remand 403 Mich 1; 268 NW2d 1 (1978); Haddad v Justice, 64 Mich App 74; 235 NW2d 159 (1975), lv den 395 Mich 825 (1976).
In this case, the trial court determined that the $2,600 that defendants paid into escrow was consideration for the option contract and, instead of granting the parties their requested relief, awarded $2,600 to plaintiff. Because neither party prevailed in full, the trial court erred by awarding costs to plaintiff.
Defendants argue further that the trial court erred by awarding plaintiff interest on the judgment. MCL 600.6013; MSA 27A.6013 provides that interest is to be paid on a money judgment in a civil action from the date the complaint is filed. The allowance of interest under this statutory provision is mandatory. Goins v Ford Motor Co, 131 Mich App 185, 201-202; 347 NW2d 184 (1983), lv den 424 Mich 879 (1976).
Defendants posit that plaintiff was not granted a judgment on which statutory interest could be awarded, but only allowed to keep the $2,600 that had been placed in escrow. A "money judgment” is one which adjudges the payment of a sum of money as distinguished from directing an act to be done. City of Warren v Dannis, 136 Mich App 651, 662-633; 357 NW2d 731 (1984). The judgment entered for plaintiff against defendants for $2,600 was thus a money judgment.
In light of the statute’s mandatory language providing for payment of interest on money judgments in civil actions, we conclude that the trial court’s award of interest to plaintiff on the $2,600 money judgment was proper.
Reversed as to costs. Affirmed in all other respects.
J. C. Kingsley, J., concurred.
MCL 559.121(1); MSA 26.50(121)(1) provides in relevant part:
A condominium unit located within this state shall not be offered for its initial sale in this state unless the offering is made in accordance with this act or the offering is exempt by rule of the administrator.
MCL 566.106; MSA 26.906 provides:
No estate or interest in lands, other than leases for a term not exceeding 1 year, nor any trust or power over or concerning lands, or in any manner relating thereto, shall hereafter be created, granted, assigned, surrendered or declared, unless by act or operation of law, or by a deed or conveyance in writing, subscribed by the party creating, granting, assigning, surrendering or declaring the same, or by some person thereunto by him lawfully authorized by writing. | [
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Doctoroff, J.
Plaintiff filed suit against defendant, his former employer. He now appeals by leave granted from the trial court’s order granting defendant’s motion for summary disposition on Count i of his complaint, alleging wrongful discharge, and Count iii, alleging violation of the Employee Right to Know Act, MCL 423.501 et seq.; MSA 17.62(1) et seq., accompanied by an invasion of privacy claim. MCR 2.116(0(10). Consolidated with plaintiff’s appeal is defendant’s appeal by leave granted from the trial court’s order denying its motion for summary disposition on Count n of plaintiff’s complaint, alleging negligent evaluation. MCR 2.116(C)(8). We reverse in part and affirm in part.
On March 15, 1982, defendant hired plaintiff to work as a machine operator. On April 12, 1983, plaintiff was fired. The immediate cause of plaintiff’s firing was his failure to appear for at least two consecutive weekend overtime shifts. Missing overtime is a violation of the rules of good conduct established in defendant’s employee information handbook, § 19.
Plaintiff had also been cited several times for poor attitude and work problems. Between June and September, 1982, plaintiff was written up seven times for low productivity, wasting time, quitting early and poor attitude. Plaintiff met with his supervisor, the plant superintendent, and the personnel director, as required in the employee information handbook, § 18. There was no disciplinary action taken against plaintiff at that time.
From September, 1982, to February, 1983, plaintiff was laid off from work. Plaintiff contends that his productivity improved following his recall in February, 1983, but the record does not contain any performance evaluations reflecting this improvement. Further, plaintiff admitted that he missed scheduled Saturday overtime, without excuse, on two occasions. Defendant alleges plaintiff missed three overtime sessions.
In April, 1983, A. H. Turner, president of defendant corporation, decided to discharge plaintiff. He referred the matter to a committee known as the Employee Committee, which was comprised of plaintiffs coworkers. The purpose of this was to ascertain the committee members’ opinions regarding whether plaintiff should be given another chance. The Employee Committee reviewed plaintiffs personnel file, which included documentary evidence of his absences and write-ups for the period of June to September, 1982. It unanimously recommended that plaintiff be fired. The president informed plaintiff that he was being fired for missing the scheduled Saturday overtime.
i
Plaintiff first claims that the trial court erred by granting summary disposition for defendant on Count i, plaintiffs wrongful discharge claim. MCR 2.116(0(10). We disagree.
Summary disposition pursuant to MCR 2.116(0(10) is proper only if there is no genuine issue as to any material fact and the party in whose favor judgment is granted is entitled to judgment as a matter of law. The motion tests the factual support of the claim. Maccabees Mutual Life Ins Co v Dep’t of Treasury, 122 Mich App 660, 663; 332 NW2d 561 (1983), lv den 417 Mich 1100.15 (1983). The court must consider the pleadings, affidavits, and other available evidence, give the benefit of any reasonable doubt to the party opposing the motion, and draw inferences in favor of that party. Vitale v Reddy, 150 Mich App 492, 498; 389 NW2d 456 (1986). Before granting sum mary disposition, the court must be satisfied that no factual development could possibly justify recovery by the nonmoving party. Id.
In Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980), the defendant company had promulgated personnel policies and disciplinary procedures in the Blue Cross "Supervisory Manual” and "Guidelines” pamphlet. The manual included provisons for warnings, notices and hearing procedures in the event of disciplinary actions. The manual also stated that termination would only occur for just cause. The plaintiff was terminated after the decision was reviewed by the personnel department, the company president and the chairman of the board of trustees, but he was not given the benefit of all the procedures in the Supervisory Manual. The plaintiff argued that Blue Cross and Blue Shield was obliged to follow its written and oral promises. The Court held that, since Blue Cross and Blue Shield had willingly published its personnel policies and practices, a jury could find that contractual obligations existed between the employer and the employee, such that the employer could only terminate for just cause. 408 Mich 617-619. Accordingly, judgment for the defendant was reversed.
Toussaint demonstrates that an employee handbook can generate contractual obligations between the employee and the employer. Accordingly, defendant in the present case had an obligation to plaintiff to follow the personnel policies and practices set forth in its G. T. Products employee handbook. According to the handbook’s provisions, defendant could not fire plaintiff at will.
Section 19 of the handbook is entitled, "Rules of Good Conduct.” It states:
The following rules of good conduct are established in the best interest of all concerned. Willful infraction of these rules will be cause for immediate discharge or other disciplinary action, depending upon the seriousness of the offense. Examples of misconduct, which are not all inclusive, are listed below:
* * *
(23) Failure or refusal to work overtime as instructed by supervision.
Examining the language of § 19 leads to the unalterable conclusion that defendant’s employees could be disciplined for refusing to work overtime and could possibly be discharged for refusing to do so. Without involving the court in an examination and technical evaluation of the legal niceties of § 19, we believe that an employee reading said section could only conclude that refusing overtime could result in termination.
Plaintiff argues that § 18 of the employee handbook lists a four-step procedure for disciplinary action and that defendant failed to follow the last two steps. He asserts that a genuine issue of fact was presented concerning the section under which he was terminated. Section 18 states that the procedure will be used for infractions such as improper work procedures, poor attendance, tardiness and unacceptable work habits. By its own terms, the procedures set forth in § 18 are not involved when disciplinary action is required for a variety of specified acts, such as fighting, theft, use of alcohol or drugs, or other "serious misconduct.” Section 19 then proceeds to list twenty-five broad-ranging examples of misconduct for which an employee can be immediately discharged. We note that although the firing was presumably done pursuant to § 19, the defendant’s president gave plaintiffs personnel file to the employee commit tee, a procedure called for only under § 18. This procedure was not completed through all four steps. Nonetheless, the effect of reading § 18 and § 19 together gives the company total discretion to decide when it will use the graduated § 18 disciplinary procedure and when it will fire an employee on the spot pursuant to § 19. Defendant granted plaintiff an opportunity to which he was not entitled by providing for advisory review by the employee committee. Plaintiff is in the position of one who, having claimed a benefit pursuant to a program such as established in the employee handbook, must take the bitter with the sweet. If there are conditions attached to that employment contract, his failure to abide by them may cost him the benefits that would otherwise accrue. See Riethmiller v Blue Cross & Blue Shield of Michigan, 151 Mich App 188, 198; 390 NW2d 227 (1986). When reading § 18 and § 19, we are left with the conclusion that § 19 clearly grants to the defendant the right to fire the plaintiff and that the plaintiff, on reading § 19, must know that this provision gives defendant that right. The clear meaning of § 19 is that termination can result from failure to work overtime.
Plaintiff relies on Damrow v Thumb Cooperative Terminal, Inc, 126 Mich App 354; 337 NW2d 338 (1983), which is distinguishable from the present case. In Damrow, the plaintiff was hired as a bookkeeper and later became office manager. The defendant company issued a policy manual that stated that no employee would be discharged without prior final warning. The manual also outlined a graduated disciplinary procedure for poor work performance. There were provisions for immediate discharge in the event of gross misconduct. The plaintiff in Damrow was fired by her superior after receiving two verbal warnings. This Court con curred in the trial court’s implicit finding that plaintiff was not discharged for gross misconduct. Therefore, in order to fire the plaintiff, the defendant had to comply with the graduated disciplinary procedures outlined under the section dealing with performance. 126 Mich App 364. The Court found that defendant did not comply.
That case is distinguishable from the present case, in that defendant here followed § 19 of its handbook. The handbook defines several offenses that could result in termination, and the company exercised its option in plaintiff’s case.
In the present case, we conclude that the trial court was correct and affirm its order granting summary disposition to defendant on Count i of plaintiff’s complaint.
ii
Defendant claims on appeal that the trial court erred by denying its motion for summary disposition as to Count n of plaintiff’s complaint, alleging negligent evaluation of his work performance. MCR 2.116(C)(8). Defendant contends that such a claim is based on alleged contractual obligations to evaluate performance as part of the employment relationship and that a tort action may not be premised on a legal duty which arises solely by virtue of an alleged contract.
Plaintiff asserts that defendant was required under the employee information handbook to evaluate its employees and to do so using reasonable care. He alleges that his evaluations were misleading, inaccurate and negligently compiled, resulting in economic and psychological damages to him.
The trial court, relying on the opinion of this Court in Schipani v Ford Motor Co, 102 Mich App 606; 302 NW2d 307 (1981), and Chamberlain v Bissell Inc, 547 F Supp 1067, 1080-1081 (WD Mich, 1982), ruled that the plaintiff’s Count n stated a cause of action for negligent evaluation of his work performance. The court ruled that defendant had a contractual obligation to perform periodic evaluations and to do so using ordinary care. It determined that the question whether defendant had done so presented a factual issue.
We are aware that in Schipani, supra, a panel of this Court recognized a cause of action for negligent performance of employee evaluations, ruling that the employment contract which required performance evaluations included a common law duty to perform these evaluations with ordinary care, and, thus, negligent performance could constitute a tort as well as a breach of contract. Id, pp 623-624.
However, the trial court in the present case overlooked a key portion of the Schipani panel’s holding:
We find that where the trier of fact is allowed to determine whether the contract was terminable at will or whether defendant and plaintiff had a binding contract which was breached by defendant (Count i), the issues of defendant’s negligence in carrying out the evaluations of plaintiff’s performance should also be determined by the trier of fact. [Id, p 624.]
Pursuant to Schipani, then, the prerequisite to avoiding summary disposition is that plaintiff must present a triable issue of fact and law as to a claim for wrongful discharge. In this case, plaintiff could not do so and his wrongful discharge claim was properly dismissed on a motion for summary disposition. Therefore, his claim for negligent evaluation, even per Schipani, also fails.
Even if plaintiff had presented a triable issue as to whether he was wrongfully discharged, he did not allege a breach of duty in Count ii which was distinct from the breach of contract, an essential element of a cause of action for negligent evaluation that Schipani does not address.
Subsequent to the holding in Schipani, another panel of this Court disallowed such a claim in Brewster v Martin Marietta Aluminum Sales, Inc, 145 Mich App 641; 378 NW2d 558 (1985). In Brewster, plaintiff-employee filed an action for wrongful discharge under Toussaint, supra, and also for negligent breach of an implied employment contract, alleging damages for mental distress, suffering and humiliation. Upon plaintiff’s appeal of the trial court’s order granting judgment notwithstanding the verdict on the tort claim of negligent breach of implied contract, this Court affirmed, stating, "in some instances a breach of a contract may give rise to an independent action arising in tort when there is a breach of duty which is distinct from the breach of contract.” Brewster, supra, p 667. The Brewster Court concluded:
[B]ecause there was no breach of duty distinct from the breach of contract, plaintiff’s cause of action arose from a breach of promise or the nonfeasance of a contractual obligation and her action is in contract, not in tort. A relationship did not exist in this case which would give rise to a legal duty without enforcement of the contract promise itself. [Id., p 668.]
The Court in Brewster relied, as did the Courts in Schipani and Chamberlain, on Hart v Ludwig, 347 Mich 559; 79 NW2d 895 (1956). In that case, the Supreme Court discussed the common origins of English common law tort and contract law and noted that some cases may support both a tort and a contract action. Id., pp 560-564. Misfeasance or negligent performance of a contractual duty may support either a tort or a contract action, while nonfeasance gives rise only to an action on the contract. Id. Our Supreme Court explained that determining whether misfeasance would support a tort action or only a contract action depends not on the slippery distinction between action and nonaction, but on the concept of duty. Id., p 565. A tort action will lie if a relationship or situation of peril exists that would give rise to a legal duty without the need to enforce the contract promise itself. Id.
Respecting the case before it, the Hart Court found that the facts would only support a breach of contract action and not a tort action:
We have simply the violation of a promise to perform the agreement. The only duty, other than that voluntarily assumed in the contract to which the defendant was subject, was his duty to perform his promise in a careful and skillful manner without risk of harm to others, the violation of which is not alleged. What we are left with is defendant’s failure to complete his contracted-for performance. This is not a duty imposed by the law upon all, the violation of which gives rise to a tort action, but a duty arising out of the intentions of the parties themselves and owed only to those specific individuals to whom the promise runs. A tort action will not lie. Id., pp 565-566.
One year following Brewster, another panel of this Court affirmed dismissal of a negligent discharge claim for failure to state a claim in Struble v Lacks Industries, Inc, 157 Mich App 169; 403 NW2d 71 (1986), where the Court held:
A breach of an employment contract does not give rise to an action sounding in negligence when the breach of duty is indistinguishable from the breach of contract. In essence, plaintiff is merely asserting that the defendant negligently fired her by breaching contractual promises arising from defendant’s policies and procedures governing discipline. These facts are evidence in support of her breach of contract claim but do not establish a separate cause of action in tort. [Citations omitted. Id., p 176.]
See also Hetes v Schefman & Miller Law Office, 152 Mich App 117, 121-122; 393 NW2d 577 (1986); Haas v Montgomery Ward & Co, 812 F2d 1015, 1016-1017 (CA 6, 1987); Brock v Consolidated Biomedical Laboratories, 817 F2d 24 (CA 6, 1987).
We note that the Schipani and Chamberlain opinions on which the trial court relied ignore the qualifying language from Hart regarding the fundamental concept of duty. Brewster correctly interprets Hart to require a tort action to rest on a breach of duty distinct from the breach of the contract duty. Brewster, supra, p 668; Hart, supra, p 565.
In this case, Count n of plaintiffs complaint does not allege a breach of duty distinct from the alleged breach of the employment contract. Although plaintiff contends that defendant was contractually obligated according to the employee information handbook to properly evaluate his work performance, if those evaluations were indeed negligently compiled, then defendant would not have performed its obligation under the contract which would constitute a breach of the contract. If defendant then discharged plaintiff based upon the negligently compiled or inaccurate evaluations, then defendant would have breached its duty to discharge plaintiff only for good cause, which is a basis for a breach of contract action. Toussaint, supra.
Accordingly, we find that defendant’s motion for summary disposition as to Count n should have been granted and reverse the trial court.
iii
Plaintiff next claims that the trial court erred by granting summary disposition to the defendant on Count in, alleging violation of § 6 of the Employee Right to Know Act, MCL 423.506; MSA 17.62(6), which prohibits an employer from disseminating disciplinary reports to third parties unconnected to the employer’s organization. MCR 2.116(0(10). He contends that defendant violated his rights under the Employee Right to Know Act when it disseminated material from his disciplinary records to defendant’s employee committee. He argues that the employee committee was not used as part of the § 18 disciplinary procedure and that a fact issue exists as to whether the employee committee was properly operating in its capacity as a disciplinary review board.
Defendant argues that, under the act, parties interested in the employment relationship are not third parties to whom dissemination of an employee’s records is prohibited. It asserts that the employee committee at G. T. Products was intended to assist in maintaining good employment relations and was intended to benefit both the employer and the employee.
Section 27 of the employee information handbook establishes an employee committee:
G. T. Products is a nonunion company. This allows all of us to deal directly with each other rather than through a third party. We can operate as a team which makes us more competitive in the marketplace, therefore assuring all of us growth potential and a long-term future. . . . The Employee Committee was established to keep open communications between all employees. Any employee interested in serving on this committee may do so by submitting their name to their supervisor. Employees will be chosen at random from the names submitted. Service on the committee will be on a rotational basis with each employee so desiring, having a turn to serve.
The Employee Committee will meet regularly or on special occasions as necessary.
The trial court concluded that the employee committee is part of the employer’s organization for purposes of the Employee Right to Know Act, having an organizational function that is related to the success and productivity of the enterprise. Although there is no case law to guide us in this regard defining the term "part of the employer’s organization,” we agree with the trial judge, who determined that the committee, because it is established in the employee information handbook and is used as part of the disciplinary procedures established in § 18 of the handbook, is a part of defendant’s organization. As the trial court found, to rule otherwise would preclude nonunion busi nesses from using employee committees in disciplinary proceedings where disciplinary reports are reviewed.
Accordingly, we affirm the trial court’s order granting summary disposition to the defendant on Count hi of plaintiffs complaint.
In conclusion, we reverse the portion of the trial court’s order denying defendant’s motion for summary disposition on plaintiffs negligent evaluation claim, Count n. We affirm both the portion of the order granting summary disposition to the defendant on plaintiffs wrongful discharge claim, Count i, and that portion granting summary disposition to the defendant on plaintiffs claim for violation of the Employee Right to Know Act, Count m.
Affirmed in part and reversed in part.
M. J. Kelly, P.J., concurred.
Following the lead of Schipani, a federal district court in Chamberlain, supra, upheld a claim for negligent performance of an employee’s evaluation, holding that a complete failure to perform a contractual obligation is actionable only as a breach of contract, but the negligent performance of the obligation is actionable as a tort.
See also Sankar v Detroit Bd of Ed, 160 Mich App 470, 479-480, n 2; 409 NW2d 213 (1987), and cases cited therein questioning the viability of the tort of negligent evaluation.
MCL 423.506; MSA 17.62(6), provides in relevant part:
(1) An employer or former employer shall not divulge a disciplinary report, letter of reprimand, or other disciplinary action to a third party, to a party who is not a part of the employer’s organization, or to a party who is not a part of a labor organization representing the employee, without written notice as provided in this section. | [
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Per Curiam.
Peggy Palloni, as next friend of her minor son, Timothy Palloni, brought suit against Steven Smith under Michigan’s dog-bite statute, MCL 287.351; MSA 12.544, as a result of events which occurred on June 12, 1981. On that date Timothy, who was two years old at the time, was walking hand in hand with plaintiff from his home to a neighbor’s home, where his sister was playing with friends. The defendant’s home was four houses from the plaintiff’s and next door to the yard in which the children were playing. While walking, plaintiff observed the defendant’s cocker spaniel walking loose in the defendant’s yard without a leash and barking at the girls next door.
Plaintiff also saw one of the girls with whom her daughter was playing teasing the dog by standing in the defendant’s driveway and stamping her feet at the dog. Plaintiff warned the girl to move away because the dog might bite. Eventually the girl stepped away and the dog sat down on the grass in the defendant’s yard, near the driveway and close to the public sidewalk. While plaintiff was talking to her daughter, Timothy let go of plaintiff’s hand, walked over to the dog, bent down, and attempted to hug it. Timothy had not actually touched the dog when it bit him on the face, causing injuries which required extensive medical care.
The trial court instructed the jury that, as no other elements of the dog bite statute had been contested, the sole factual issue was whether the attack was without provocation and further instructed the jury that plaintiff had the burden of proof on the question of provocation. Plaintiff’s attorney conceded that, if the jury found the attempted hug to be provocative, plaintiff could recover no damages. After the jury returned a verdict of no cause of action, the trial judge granted plaintiff’s motion for a new trial on the ground that the verdict was against the great weight of the evidence. From that opinion and order the defendant has been granted leave to appeal to this Court.
It is within the sound discretion of the trial court to grant or deny a motion for a new trial; however, a court may not substitute its judgment for that of the finders of fact, and a jury’s verdict should not be set aside where there is competent evidence to support it. Bell v Merritt, 118 Mich App 414, 422; 325 NW2d 443 (1982), lv den 417 Mich 954 (1983). Here, we find there was competent evidence to support the jury’s verdict.
This case was brought under MCL 287.352; MSA 12.544:
The owner of any dogs which shall without provocation bite any person while such person is on or in a public place, or lawfully on or in a private place, including the property of the owner of such dog, shall be liable for such damages as may be suffered by the person bitten, regardless of the former viciousness of such dog or the owner’s knowledge of such viciousness.
Here, the jury clearly must have found there to have been provocation. For us to determine that there was competent evidence to sustain that finding, we must also find that a person who does not intend to provoke a dog nevertheless can do things which are sufficiently provocative to relieve a dog owner of liability under the statute.
In Nicholes v Lorenz, 396 Mich 53; 237 NW2d 468 (1976), reh den 396 Mich 976 (1976), the Supreme Court noted that the question for the jury, where it was agreed that the defendant’s dog had bitten the plaintiffs daughter after the girl had stepped on the dog’s tail, was whether that act constituted provocation under the statute. Nicholes, supra at 60. The Court also noted that, in enacting a statute which imposed almost absolute liability for dog owners, "the Legislature excepted the consequences which might reasonably result from provoking an animal.” Nicholes, supra at 59-GO.
While no Michigan appellate decisions have focused expressly on the dog-bite victim’s intent, the appellate courts of other jurisdictions have. The Illinois appellate court, in Nelson v Lewis, 36 Ill App 3d 130; 344 NE2d 268 (1976), was confronted with a dog-bite statute similar to Michigan’s and held that an unintentional act can constitute provocation. In that case, the court found that a 2 Vi-year-old girl’s stepping on the tail of a normally peaceful dog was sufficient provocation to preclude recovery under the statute, despite the fact that the provocation was not intentional. Nelson, supra at 133. That court also emphasized that the young girl’s tender age did not relieve her of the responsibility for the provoking act. Id.
Four years later the Illinois appellate court followed the rule it had established in the Nelson case. In Stehl v Dose, 83 Ill App 3d 440; 403 NE2d 1301 (1980), it decided that the question of provocation under the dog-bite statute must focus on whether the plaintiffs actions would be provocative to the dog. Going on, the Illinois court said: "However, whether plaintiffs conduct amounted to provocation is not clear. Reasonable men would differ and accordingly, we view this issue as one especially suited to jury determination.” Stehl, supra at 443. Because it concluded that the evidence could support a finding either way on the issue of provocation, the court held that the verdict for the defendant did not go against the great weight of the evidence. Id.
A similar pattern of decisions has emerged in the Arizona appellate courts. In Toney v Bouthillier, 129 Ariz 402; 631 P2d 557 (Ariz App, 1981), the Arizona Court of Appeals determined that the dog-bite statute of that state imposed liability on dog owners regardless of the owner’s fault. "Consequently,” the court concluded, "we believe that the corresponding statutory defense (of provocation) must be construed without reference to fault of the individual committing the provocation.” Toney, supra at 405. As had the Illinois court, the Arizona court also found that the actions of children of tender years may be sufficient provocation under the statute.
The Arizona Court of Appeals adhered to its Toney decision in James v Cox, 130 Ariz 152, 156; 634 P2d 964 (Ariz App, 1981), when it ruled that a trial court did not err by instructing a jury that unintentional provocation is a defense under the dog-bite statute. That court cited the Michigan Supreme Court’s decision in Nicholes and, while noting that the case did not specifically involve an unintentional provocation defense, said: "Thus, the court implied that provocation depends on whether the actions caused the animal to react rather than on the intent of the actor.” James, supra at 156, n 4.
In the present case, the trial court erred in setting aside the jury’s verdict, since there was competent evidence to support it. Although the plaintiff claims that Timothy meant only to hug the dog, an unintentional act may constitute provocation within the meaning of Michigan’s dog-bite statute. Expressed differently, since that statute imposes liability on dog owners without regard to fault, the defense of provocation must be construed without concern for fault on the part of the person committing the provocation. The focus must be on the injured party’s act, not on his intent, and whether that act was sufficient to provoke the dog’s attack. A provocation defense should not be precluded simply because the plaintiff did not intend to provoke the dog.
Consistent with such a conclusion, the injured party’s age is not an impediment to a defense of provocation under the dog-bite statute. The actions of a child of tender years may constitute provocation under this act.
Based upon the evidence presented in this case, reasonable minds could have differed whether the defendant’s dog had been provoked by Timothy. Because the evidence, based upon the legal analysis above, could have supported a finding either way on the issue of provocation, the jury’s verdict was not against the great weight of the evidence.
The trial court’s order for a new trial is reversed and the jury’s verdict of no cause of action is reinstated. | [
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MacKenzie, J.
In 1974, plaintiffs purchased forty-four acres of undeveloped land in Section 3, Forest Township, Cheboygan County. Before purchasing the property, plaintiffs obtained an abstract and had it updated and certified by defendant Burton Abstract and Title Company. They then obtained two title opinions. When it appeared that all clouds on title had been removed, plaintiffs received a warranty deed which contained two descriptions, one of a forty-acre parcel, essentially consisting of the NW 14 of the SW 14 of Section 3, and one of an adjoining four-acre parcel, located in the NW 14 of Section 3. The description of the four-acre parcel excepted "the Right of Way of the Detroit and Mackinaw Railroad.”
Delmar Porter surveyed plaintiffs’ forty-four acres in 1975. Later, while performing an unrelated survey, Porter discovered the existence of a Detroit & Mackinac Railroad (d&m) "wye track” or "turn-around” right of way which ran through the forty-acre parcel. D&m’s interest in the right of way was conveyed to it by a 1901 warranty deed from Frank and Ida Stinchfield. Tracks were laid, but apparently pulled up in the 1950s. It is undisputed that in 1948 d&m recorded a notice of its rights of way. It is also undisputed that this notice was not included in the abstract prepared by defendant Burton Abstract. The instant quiet title action against defendant d&m ensued after plaintiffs learned of the right of way located on the forty-acre parcel. Plaintiffs also asserted a claim of negligence against defendant Burton Abstract.
Following a bench trial, the court on May 5, 1986, entered a judgment determining that d&m had preserved its interest in the right of way and that Burton Abstract was negligent in failing to include that interest in its abstract of plaintiffs’ property. The court ordered Burton Abstract to cure the defect in plaintiffs’ title by buying the disputed right of way from d&m and conveying it to plaintiffs. Burton Abstract appeals as of right. Plaintiffs cross-appeal the judgment in favor of d&m. We affirm.
On appeal, Burton Abstract first contends that d&m did not acquire title to the wye track right of way through plaintiffs’ forty-acre parcel under the 1901 Stinchfield deed. According to Burton Abstract, the Stinchfield deed conveyed to d&m property located in Section 4, rather than Section 3, of Forest Township. The argument is wholly without merit. An examination of the Stinchfield deed establishes that it conveyed property located exclusively in Section 3, the location of plaintiffs’ property and the wye track right of way.
Burton Abstract next argues that, even if d&m had title to the right of way, the trial court erred in finding that d&m preserved its interest under the marketable record title act, MCL 565.101 et seq.; MSA 26.1271 et seq. Plaintiffs join in this argument.
Under § 3 of the marketable record title act, MCL 565.103; MSA 26.1273, d&m’s interest in plaintiffs’ forty-acre parcel, conveyed to it in 1901, was extinguished unless within the forty-year period prior to plaintiffs’ purchase d&m recorded a notice of its interest. Section 5 of the act, MCL 565.105; MSA 26.1275, states:
To be effective and to be entitled to record the notice above referred to shall contain an accurate and full description of all the land affected by such notice which description shall be set forth in particular terms and not be general inclusions ....
The notice that d&m recorded on January 29, 1948, after fixing the location of the land in Forest Township in Cheboygan County, refers to
[a] 100 foot right-of-way lying 50 feet on each side of the centerline of the main railroad track as now laid over and across the northwest quarter of the southwest quarter and the northwest quarter, Section 3; and the northeast quarter of Section 4; Town 34 North, Range 1 East. Also a 100 foot right-of-way lying 50 feet on each side of the centerline of the abandoned Indian River Branch and the abandoned Wye tracks in said descriptions. [Emphasis added.]
Thus, the notice described the affected land as one hundred feet along the abandoned wye tracks in the NW V4 of the SW 14, Section 3 of Forest Township. Plaintiffs’ forty-acre parcel consists of all but a small wedge of the NW 14 of the SW 14 of Section 3.
Plaintiffs and Burton Abstract contend that reference to abandoned railroad tracks is too general to satisfy the particularity requirement of § 5 of the marketable title act. We disagree. The purpose of the filing of notice provision is to put persons on notice of existing interests in land created by a conveyance or title transaction which was executed more than forty years in the past. The notice in this case was sufficient to accomplish that purpose. It gave notice of a claim of interest in the wye track bed located in the NW Va of the SW Va of Section 3 — plaintiffs’ forty acres. No more was needed to alert a person examining title to the parcel to the possibility of a cloud on title. Furthermore, no more was needed to alert an abstracter that the claim should be included in the abstract of any parcel within the NW Va of the SW Va of Section 3. Burton Abstract’s failure to do so must be attributed to its abstracter, not a deficiency in d&m’s notice of claim.
Burton Abstract next argues that the judgment against it must be reversed because the trial judge failed to set forth specific findings of fact on the ownership of the disputed property. The argument is without merit. A reading of the judge’s decision makes it clear that he found d&m to be the owner of the right of way because its 1948 notice of claim was satisfactory and because plaintiffs had failed to prove adverse possession. This was sufficient to comply with MCR 2.517. See, e.g., Birkenshaw v Detroit, 110 Mich App 500, 509; 313 NW2d 334 (1981), lv den 417 Mich 913 (1983).
Next, plaintiffs and Burton Abstract argue that the trial court erred in finding that plaintiffs failed to prove their claims of adverse possession and abandonment against d&m. In order to secure title by adverse possession, the claimant’s possession must be actual, visible, open, notorious, exclusive, continuous, uninterrupted for the fifteen-year statutory period and under color or claim of right. Burns v Foster, 348 Mich 8, 14; 81 NW2d 386 (1957); Mackinac Island Development Co, Ltd v Burton Abstract & Title Co, 132 Mich App 504, 512; 349 NW2d 191 (1984), lv den 422 Mich 939 (1985). The doctrine of adverse possession is strictly construed. The party alleging title by adverse possession must prove the same by clear and positive proof. Mackinac Island Development Co, Ltd, supra, p 512. The essential elements of abandonment are an intent to relinquish the property and acts putting that intention into effect. Van Slooten v Larsen, 410 Mich 21, 50; 299 NW2d 704 (1980), appeal dismissed 455 US 901 (1982); Emmons v Easter, 62 Mich App 226, 237; 233 NW2d 239 (1975). Nonuse by itself is insufficient to show abandonment. Emmons, supra, p 237.
In the instant case, d&m employee James Keavey testified that he inspects d&m’s property in the area on a monthly basis, including the right of way across plaintiffs’ property. Keavey further testified that trackage is removed because it is cost-effective in that the equipment can be used elsewhere, not because d&m has abandoned a right of way. Keavey never saw any use of the property that would have prevented d&m’s use. He stated that in cases where the railroad’s property is encroached upon or fenced off, the railroad advises the encroacher that it is railroad property and that the encroachment must be removed.
We agree with the trial court that plaintiffs failed to prove that d&m intended to abandon its right of way. We do not believe that the use of the term "abandoned” in d&m’s 1948 notice of claim showed an intention to abandon its property interest in the right of way; the evidence indicates that the term refers only to the fact that d&m was no longer using the right of way in its operations. Indeed, the filing of the notice in itself indicated that d&m intended to preserve its interest. We further agree with the trial court that plaintiffs failed to prove adverse possession. Plaintiffs had not owned their property for the fifteen-year statutory period, and presented no evidence for purposes of "tacking” that their predecessor in title had adversely possessed the right of way.
Burton Abstract also contends that the court’s judgment must be reversed because, while it directs Burton Abstract to "purchase or otherwise negotiate the conveyance from d&m railroad to Plaintiffs of the subject real estate,” it does not order d&m to sell the property or establish a. fair market value. We believe the judgment is enforceable as presently drafted. At trial, it was established that d&m is willing to sell the right of way, and that it had recently sold similar rights of way for $650 an acre. Even if defendant Burton Abstract is unable to purchase the property, the judgment directs Burton Abstract to pay damages to plaintiffs measured by the difference between the value of the land with the encumbrance and without the encumbrance, and provides for an evidentiary hearing to make that determination. Therefore, reversal is not warranted.
Finally, Burton Abstract contends that the judgment is inconsistent with the court’s findings of fact. On this point we agree. In his ruling from the bench, the trial judge stated that no damages could be assessed for the right of way over the four-acre parcel, since that right of way was specifically excepted in plaintiffs’ deed. However, the May 5, 1986, judgment’s description of the property from which the right of way must be cleared includes the four-acre parcel. Plaintiffs concede that this was error. We therefore remand to the circuit court to amend its judgment to . exclude the four-acre parcel from its description of the property subject to damages.
Affirmed and remanded for correction of judgment. We do not retain jurisdiction. | [
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G. R. McDonald, J.
Plaintiff appeals as of right from the trial court’s denial of her motion for judgment notwithstanding the verdict, for new trial, and for relief from judgment. MCR 2.610, 2.611, 2.612. We affirm.
On December 17, 1984, plaintiff filed a paternity complaint against defendant, alleging that defendant was the father of Jennifer Hazel, who was born on February 28, 1982, and conceived on or about June 15, 1981. Defendant denied paternity, claiming that his son, Leroy Hazel, was the child’s father. At a pretrial hearing the parties stipulated that Leroy would submit to a blood test and polygraph examination, and Leroy consented to this arrangement. However, no blood test or polygraph was administered to Leroy prior to trial.
At trial defendant testified that he and plaintiff did not have intercourse after March 1, 1981, the night he allegedly found plaintiff and his son, Leroy, in bed together. According to defendant, plaintiff and Leroy began living together. Sometime in July plaintiff allegedly phoned defendant and told him that she and Leroy were having a baby and that defendant was going to pay for it. Plaintiff then told defendant that if he paid Leroy $5,000 and plaintiff $2,500 she would not "press it.”
Plaintiff testified that she met defendant in 1979 and began living with him in January, 1981. She lived with defendant on and off until November 13, 1981. Plaintiff denied having intercourse with anyone else while living with defendant and denied having intercourse on any occasion with Leroy. Plaintiff introduced into evidence the results of a blood test which indicated a 99.9 percent probability that defendant, as compared to a random man, was the father of Jennifer Hazel.
Leroy Hazel testified that he never had inter course with plaintiff and that in January, 1984, defendant asked him how much it would cost defendant for Leroy to say that the child was Leroy’s. Defendant allegedly suggested that Leroy claim the child because child support would be considerably less based on Leroy’s income than on defendant’s. Leroy stated that he did not take the blood test because he became suspicious of plaintiff’s attorney and because he became aware that the person who was to administer the polygraph examination had been convicted of taking bribes.
A note written to plaintiff by defendant, which suggested that plaintiff and defendant were cohabiting at the time the note was written, was introduced into evidence. Defendant admitted that he wrote the note but denied putting the date, 10/22/81, on it.
The jury found that defendant was not the father of Jennifer Hazel. Plaintiff’s motion for judgment notwithstanding the verdict was denied. Plaintiff also moved for a new trial, pursuant to MCR 2.611, and for relief from the judgment, pursuant to MCR 2.612. At this time, plaintiff produced the results of a blood test which excluded Leroy Hazel as the father of Jennifer Hazel. Plaintiff also produced the opinion of a handwriting analyst that the date 10/22/81, appearing on the letter which was introduced into evidence, was written by defendant.
The court denied plaintiff’s motions. It ruled that the blood test results and the handwriting analysis could have been discovered before trial by the exercise of due diligence. It also ruled that the verdict of the jury was not against the great weight of the evidence.
Plaintiff now appeals from the denial of her motions for judgment notwithstanding the verdict, for a new trial, and for relief from judgment. We affirm.
In reviewing a trial court’s denial of judgment notwithstanding the verdict, this Court should inquire whether the jury’s verdict was against the great weight of the evidence, Beard v Detroit, 158 Mich App 441; 404 NW2d 770 (1987). Furthermore, the decision of the trial court is afforded great deference because the trial judge, having heard the witnesses, is uniquely qualified to judge the jury’s assessment of the witnesses’ credibility. Beard, supra. If reasonable minds could differ as to whether plaintiff satisfied her burden of proof, judgment notwithstanding the verdict would have been improper. Production Finishing Corp v Shields, 158 Mich App 479; 405 NW2d 171 (1987). In this case, reasonable minds could differ as to whether plaintiff proved by a preponderance of the evidence, Huggins v Rahfeldt, 83 Mich App 740; 269 NW2d 286 (1978), that defendant was the father of Jennifer Hazel. Defendant testified that he did not have intercourse with plaintiff after March 1, 1981. Plaintiff estimated that the child was conceived on June 15 or 16, 1981. Defendant further testified that he had seen plaintiff engage in intercourse with defendant’s son, Leroy Hazel, and that plaintiff had told defendant "Leroy and I are going to have a baby.” Although a blood test indicated a 99.9 percent probability that defendant was the father as compared to any random man, a genetics expert testified that similar numbers might be generated in blood tests of male relatives of defendant, due to the genetic similarity between relatives. No analysis of Leroy Hazel’s blood was submitted at trial.
Plaintiff’s testimony was diametrically opposed to that of defendant. She testified that she had intercourse with defendant on June 15 or 16, 1981, and that she lived with him until November 13, 1981. Plaintiff and Leroy Hazel both testified that they had not engaged in intercourse.
The conflicting testimony in this case required the jury to judge the credibility of the parties, and that jury decided in favor of defendant. The trial court’s judgment of the jury’s assessment of the credibility of the witnesses should not be disturbed on appeal.
MCR 2.611(A)(1) provides for a new trial for the following reasons:
(a) Irregularity in the proceedings of the court, jury, or prevailing party, or an order of the court or abuse of discretion which denied the moving party a fair trial.
(b) Misconduct of the jury or of the prevailing party.
* * *
(e) A verdict or decision against the great weight of the evidence or contrary to law.
(f) Material evidence, newly discovered, which could not with reasonable diligence have been discovered and produced at trial.
* * *
(h) A ground listed in MCR 2.612 warranting a new trial.
Plaintiff has asserted on appeal that a new trial should have been granted pursuant to MCR 2.611(A)(1)(a), (b), (e) and (h). She thus claims that a new trial should have been granted because of irregularities in the proceedings which denied her a fair trial, because of defendant’s misconduct, and because the jury’s verdict was against the great weight of the evidence.
MISCONDUCT OF DEFENDANT
At the hearing on the motion for a new trial, plaintiff produced blood test results which indicated that Leroy Hazel was excluded as the father of Jennifer Hazel. Plaintiff thus concludes that defendant’s testimony concerning the sexual relationship between plaintiff and Leroy Hazel was a deliberate misrepresentation, resulting in fraud and requiring a new trial.
The blood test does indicate that Leroy Hazel is not the father of Jennifer Hazel. However, it does not prove that defendant testified falsely when he stated he saw plaintiff and Leroy engaging in sexual intercourse. The claim that defendant’s misconduct in so testifying requires a new trial is therefore without merit.
Next, plaintiff asserts that defendant perjured himself by stating that the date 10/22/81, on a note from defendant to plaintiff, was not written by defendant. At the hearing on the motion for a new trial, plaintiff produced the opinion of a document examiner that the date on the letter was written by defendant.
The discovery that testimony introduced at trial was perjured may be grounds for ordering a new trial, People v Barbara, 400 Mich 352; 255 NW2d 171 (1977). In Barbara, supra, the defendant’s claim that trial testimony had been perjured was based on newly discovered evidence, specifically statements by two new witnesses that a trial witness had lied. The Court in Barbara discussed the standard for granting a new trial based on newly discovered evidence. See also People v Bell, 74 Mich App 270; 253 NW2d 726 (1977); People v Louis Williams, 77 Mich App 119; 258 NW2d 68 (1977).
In this case too, plaintiff’s claim that defendant perjured himself is dependent upon newly discovered evidence, specifically a handwriting analysis indicating that the date on the letter admitted at trial was, contrary to defendant’s testimony, written by defendant. Because plaintiffs claim that defendant perjured himself is dependent upon newly discovered evidence, the motion should be treated as one based on new evidence. A motion for a new trial based upon newly discovered evidence could be granted only if the newly discovered evidence "could not with reasonable diligence have been discovered and produced at trial,” MCR 2.611(A)(1)(f). The trial court’s denial of a new trial will not be reversed on appeal unless it was an abuse of discretion. Willett v Ford Motor Co, 400 Mich 65; 253 NW2d 111 (1977).
The trial court did not abuse its discretion in denying a new trial in this case. Plaintiff could have produced at trial the evidence which was presented in a posttrial motion. Because plaintiff could have, with due diligence, produced the opinion of a document examiner at trial, the posttrial production of the evidence does not warrant a new trial.
PROCEDURAL IRREGULARITIES
Plaintiff apparently argues that defendant’s alleged perjury is a procedural irregularity. However, we have already dismissed plaintiff’s argument that defendant’s alleged perjury at trial requires a new trial.
WEIGHT OF EVIDENCE
The denial of a motion for new trial on the ground that the verdict is against the great weight of the evidence is within the discretion of the trial court. The court’s decision will not be disturbed on appeal unless a clear abuse is shown. Harrigan v Ford Motor Co, 159 Mich App 776; 406 NW2d 917 (1987). As when reviewing the denial of a motion for judgment notwithstanding the verdict, this Court in considering whether the trial court abused its discretion in denying a motion for a new trial recognizes the unique opportunity of the jury and trial judge to observe the witnesses.
As previously noted, the testimony of plaintiff and defendant was diametrically opposed. On appeal, plaintiff asserts that "[t]he testimony of Dr. Gershowitz that the probability of paternity was 99.99% was in no way rebutted by the defendantappellee.” Dr. Gershowitz also testified at trial, however, that "if you don’t exclude male relatives . . . there is a good chance that the number generated will be similar because relatives share these genes.”
Given the testimony introduced at trial, the jury was required to make a judgment of credibility of the witnesses. The trial court, having the opportunity to observe the witnesses, did not abuse its discretion by refusing to grant a new trial on the ground that the jury’s verdict was against the great weight of the evidence.
Plaintiff also requests a new trial for all the reasons which would warrant relief from the judgment under MCR 2.612. MCR 2.612(C)(1) provides for relief from judgment on the following grounds:
(c) Fraud (intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party.
* * *
(f) Any other reason justifying relief from the operation of the judgment.
Plaintiff claims that the trial court should have set aside the judgment in this case because the blood test and handwriting analysis produced after trial revealed fraud on the part of defendant and because of the extraordinary circumstances of this case.
MCR 2.612 allows two means of obtaining relief from a judgment procured by fraud. A party may obtain relief by motion in the case in which the adverse judgment was rendered, MCR 2.612(C)(1)(c), or the party may proceed by independent action, MCR 2.612(C)(2). The standards for relief under the two sections of MCR 2.612 involve a distinction between extrinsic and intrinsic fraud. Extrinsic fraud is fraud which actually prevents the losing party from having an adversary trial on a significant issue. Rogoski v Muskegon, 107 Mich App 730, 736; 309 NW2d 718 (1981). Perjury is merely intrinsic fraud; while it constitutes fraud in obtaining a judgment, it does not prevent an adversary trial. Id. at 737.
The Court in Rogoski held that a party proceeding in an independent action is entitled to relief only from a judgment procured by extrinsic fraud. The Court stated, however:
This does not mean that a litigant is never entitled to relief from a judgment obtained by intrinsic fraud. However, this relief cannot be by independent action but, rather, must be by motion in the case in which the adverse judgment was rendered. [Id.]
The Court in Rogoski did not elaborate on the circumstances which would justify relief by motion in the case, and the matter has not been treated in other Michigan cases.
Plaintiff sought relief in the lower court by motion in the case in which adverse judgment was rendered, MCR 2.612(C)(1)(c). Plaintiff’s allegation of fraud rests on newly discovered evidence. The handwriting analysis produced with plaintiffs posttrial motion, if accepted as reliable, would prove that defendant lied when he stated in court that he did not write the date which appeared on a letter which was introduced into evidence.
Because plaintiffs allegation of perjury is dependent upon newly discovered evidence, we conclude that such perjury should warrant relief from judgment only if it could not have been discovered and rebutted at trial by the exercise of due diligence. Any other result would undermine MCR 2.611(A)(1)(f), which allows a new trial based on newly discovered evidence only when that evidence "could not with reasonable diligence have been discovered and produced at trial.” Plaintiff in this case seeks to obtain relief by alleging perjury based on newly discovered evidence without being subject to the restraints placed on such evidence under MCR 2.611.
The blood test excluding Leroy Hazel as the father of Jennifer Hazel does not prove that defendant perjured himself at trial, and the handwriting analysis indicating that the date written on the letter introduced into evidence was written by defendant could have been produced at trial with due diligence. Plaintiff therefore may not obtain a new trial based on fraud where the allegations of fraud are dependent upon newly discovered evidence which could have been produced at trial.
Lastly, plaintiff claims that the extraordinary circumstances of this case warrant setting aside the judgment. MCR 2.612(C)(1)(f) provides for relief based on "[a]ny other reason justifying relief from the operation of the judgment.” However, the provision "was not intended to relieve a party of the necessity for protecting his interest by normally prescribed procedures.” Kaleal v Kaleal, 73 Mich App 181, 189; 250 NW2d 799 (1977), quoting 3 Honigman & Hawkins, Michigan Court Rules Annotated (2d ed), p 189. Plaintiff should thus not be relieved of her duty to timely produce evidence for trial. Further, Michigan courts have adopted the federal criteria for the application of the "extraordinary circumstances” provision:
In general, relief has been granted under this provision where the judgment was obtained by the improper conduct of the party in whose favor it was rendered, or resulted from the excusable default of the party against whom it was directed, under circumstances not covered by clauses (1) through (5) and where the substantial rights of other parties in the matter in controversy were not affected. [Emphasis added. Id.]
The circumstances alleged by plaintiff are covered by clauses (c) and (b) of MCR 2.612, relating to fraud and to newly discovered evidence. Relief based upon extraordinary circumstances is thus not available to plaintiff.
Plaintiff also asserts on appeal that the trial judge erred in failing to disqualify himself sua sponte from the case after plaintiff filed a grievance against him. However, because plaintiff has cited no authority supporting this proposition, the issue is not preserved for appeal. People v United States Currency, 158 Mich App 126; 404 NW2d 634 (1986).
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BECKERING, J.
Defendants, the state and the Governor of Michigan (collectively “the state”), appeal by leave granted the trial court’s order dated December 15, 2011, denying the state’s motion for summary disposition. For the reasons set forth in this opinion, we affirm and lift the stay previously imposed by this Court.
I. PERTINENT FACTS AND PROCEDURAL HISTORY
This case returns to this Court after a remand by our Supreme Court to the trial court. Plaintiffs filed suit challenging the sufficiency of the state’s indigent criminal defense system and sought, through a class action, injunctive relief to improve the quality of indigent representation throughout Michigan. Plaintiffs’ proposed class consists of present and future indigent criminal defendants who require counsel appointed through our indigent criminal defense system. The state previously moved for summary disposition under MCR 2.116(C)(4), (7), and (8), arguing, among other things, that plaintiffs’ preconviction claims were nonjusticiable because plaintiffs (a) had failed to meet the certification requirements of a class action, (b) had failed to properly plead a valid cause of action against the state, and (c) lacked standing. The trial court disagreed and certified plaintiffs’ class.
On appeal, a majority of this Court held that
on the basis of the pleadings and at this juncture in the lawsuit, plaintiffs have sufficiently alleged facts that, if true, establish standing, establish that the case is ripe for adjudication, and state claims upon which declaratory and injunctive relief can be awarded. Finally, we hold that the trial court properly granted the motion for class certification. [Duncan v Michigan, 284 Mich App 246, 343; 774 NW2d 89 (2009).]
In a dissenting opinion, Judge WHITBECK opined that the state was entitled to summary disposition for the following reasons: (1) granting relief to plaintiffs would violate the separation of powers, (2) plaintiffs had failed to state a proper claim for relief, lacked standing, and had pleaded unripe claims, and (3) plaintiffs’ action was incorrectly certified as a class action. Id. at 346, 371, 376, 385-388, 395-399 (WHITBECK, J., dissenting).
The state sought leave to appeal in our Supreme Court. In Duncan v Michigan, 486 Mich 906 (2010), our Supreme Court ordered as follows:
Leave to appeal having been granted and the briefs and oral arguments of the parties having been considered by the Court, we hereby vacate the trial court’s order granting the plaintiffs’ motion for class certification and remand this case to the Ingham Circuit Court for reconsideration of the plaintiffs’ motion for class certification in light of this Court’s opinion in Henry v Dow Chemical Co, 484 Mich 483 [772 NW2d 301] (2009).
As to the defendants’ appeal of the decision on then-motion for summary disposition, we hereby affirm the result only of the Court of Appeals majority for different reasons. This case is at its earliest stages and, based solely on the plaintiffs’ pleadings in this case, it is premature to make a decision on the substantive issues. Accordingly, the defendants are not entitled to summary disposition at this time.
We do not retain jurisdiction.
The Supreme Court subsequently granted reconsideration and reversed this Court’s decision for the reasons stated in Judge WHITBECK’s dissenting opinion. Duncan v Michigan, 486 Mich 1071 (2010). However, our Supreme Court later reinstated its original order affirming this Court’s decision and remanding the matter to the trial court. Duncan v Michigan, 488 Mich 957 (2010).
On remand, the trial court held a status conference and decided to permit the parties to conduct discovery before deciding plaintiffs’ motion for class certification. Before a single deposition was taken, however, the state renewed its motion for summary disposition, arguing the following: (1) discovery was inappropriate because the Supreme Court had remanded for consideration of plaintiffs’ pending class-certification motion and not a renewed motion with the benefit of discovery, (2) plaintiffs’ claims should not be certified as a class action, (3) plaintiffs lacked standing, (4) plaintiffs had failed to state a proper claim for which relief could be granted, (5) res judicata barred plaintiffs’ claims, and (6) plaintiffs could not object to the state’s challenges because of judicial estoppel. The trial court denied the state’s motion, holding that (a) it was premature to decide plaintiffs’ class-certification motion because Henry required the court to take discovery before deciding a certification motion, (b) it could not reconsider the state’s MCR 2.116(C)(8) motion or plaintiffs’ standing because both this Court and our Supreme Court had already decided those matters in plaintiffs’ favor, and (c) the state had failed to establish any of the elements of res judicata.
II. ANALYSIS
A. class certification
The state first argues that the trial court erroneously failed to dismiss plaintiffs’ motion for class certification when it denied the state’s motion for summary disposition. The state suggests that the trial court inappropriately ordered discovery and insists that plaintiffs “have not met their burden of establishing that each certification prerequisite has been satisfied.” We reject this argument.
We review de novo a trial court’s decision on a motion for summary disposition. Auto Club Group Ins Co v Burchell, 249 Mich App 468,479; 642 NW2d 406 (2001). “[T]he analysis a trial court must undertake in order to determine whether to certify a proposed class may involve making both findings of fact and discretionary determinations”; therefore, we review a trial court’s factual findings regarding class certification for clear error and the decisions within the trial court’s discretion for an abuse of discretion. Henry, 484 Mich at 495-496. State courts “have broad discretion to determine whether a class will be certified.” Id. at 504. An abuse of discretion occurs when the trial court’s decision falls outside the range of principled outcomes. Maldonado v Ford Motor Co, 476 Mich 372, 388; 719 NW2d 809 (2006). The interpretation and application of a court rule is a question of law that we review de novo. Snyder v Advantage Health Physicians, 281 Mich App 493, 500; 760 NW2d 834 (2008).
For a court to grant a motion for class certification, the requirements of MCR 3.501(A)(1) and (2) must be satisfied. Henry, 484 Mich at 488, 496-497. MCR 3.501(A)(1) requires that a proposed class of plaintiffs establish the following elements: (1) the class is suffi ciently numerous that joinder of all members is impracticable, (2) the common questions of fact or law predominate over matters relevant to only individual plaintiffs, (3) the claims of the class representatives are typical of the claims available to the entire class, (4) the class representatives will fairly and adequately represent the interests of the entire class, and (5) the class-action mechanism is superior to other methods of adjudication. Id. at 496-497. In evaluating the “superiority” element, MCR 3.501(A)(2) requires consideration of the following nonexclusive factors:
(a) whether the prosecution of separate actions by or against individual members of the class would create a risk of
(i) inconsistent or varying adjudications with respect to individual members of the class that would confront the party opposing the class with incompatible standards of conduct; or
(ii) adjudications with respect to individual members of the class that would as a practical matter be dispositive of the interests of other members not parties to the adjudications or substantially impair or impede their ability to protect their interests;
(b) whether final equitable or declaratory relief might be appropriate with respect to the class;
(c) whether the action will be manageable as a class action;
(d) whether in view of the complexity of the issues or the expense of litigation the separate claims of individual class members are insufficient in amount to support separate actions;
(e) whether it is probable that the amount which may be recovered by individual class members will be large enough in relation to the expense and effort of administering the action to justify a class action; and
(f) whether members of the class have a significant interest in controlling the prosecution or defense of separate actions.
The trial court cannot rubber-stamp allegations in a pleading that baldly proclaim that the class-certification requirements have been satisfied, but the trial court also cannot evaluate the merits of the plaintiffs’ claims. Henry, 484 Mich at 502-503. “A court may base its decision on the pleadings alone only if the pleadings set forth sufficient information to satisfy the court that each prerequisite is in fact met.” Id. at 502. “If the pleadings are not sufficient, the court must look to additional information beyond the pleadings to determine whether class certification is proper.” Id. at 503. “The court may allow the action to be maintained as a class action, may deny the motion, or may order that a ruling be postponed pending discovery or other preliminary procedures.” MCR 3.501(B)(3)(b).
We conclude that the state’s argument fails for three reasons. First, the trial court did not certify plaintiffs’ action as a class action; it merely denied the dispositive motion until discovery could be completed. Second, the trial court did not abuse its discretion by postponing the class-certification question until discovery could be completed. The trial court is required to consider facts outside the pleadings if the pleadings are insufficient to establish plaintiffs’ entitlement to class certification. Henry, 484 Mich at 502-503. Under MCR 3.501(B)(3)(b), the trial court could postpone the class-certification question pending discovery. Thus, its de cisión to do so did not fall outside the range of principled outcomes. Third, the trial court’s denial of the state’s motion on the basis that the motion was premature did not contravene the Supreme Court’s order. The trial court was in fact obeying our Supreme Court’s order to consider the class-certification question in light of Henry. On remand, a trial court is required to comply with a directive from an appellate court. Schumacher v Dep’t of Natural Resources, 275 Mich App 121, 128; 737 NW2d 782 (2007).
Accordingly, the trial court did not err by denying the state’s motion for summary disposition with respect to the issue of class certification.
B. FAILURE TO STATE A CLAIM
Next, the state argues that the trial court erroneously denied its dispositive motion under MCR 2.116(C)(8) because plaintiffs had plainly failed to plead a proper cause of action. We disagree.
This Court previously held that plaintiffs had properly stated “claims upon which declaratory and injunctive relief can be awarded,” thus defeating the state’s motion under MCR 2.116(C)(8). Duncan, 284 Mich App at 343. Our Supreme Court later affirmed, albeit in result only, opining that solely on the basis of “plaintiffs’ pleadings in this case, it is premature to make a decision on the substantive issues.” Duncan, 486 Mich at 906. Thus, the only proper question for this Court to address is whether the state’s argument is foreclosed under the law of the case doctrine.
Whether the law of the case doctrine applies is a question of law that we review de novo. Kasben v Hoffman, 278 Mich App 466, 470; 751 NW2d 520 (2008). Generally, the law of the case doctrine provides that an appellate court’s decision “will bind a trial court on remand and the appellate court in subsequent appeals.” Schumacher, 275 Mich App at 127. “Where a case is taken on appeal to a higher appellate court, the law of the case announced in the higher appellate court supersedes that set forth in the intermediate appellate court.” Johnson v White, 430 Mich 47, 53; 420 NW2d 87 (1988). However, “[r]ulings of the intermediate appellate court. .. remain the law of the case insofar as they are not affected by the opinion of the higher court reviewing the lower court’s determination.” Id. The law of the case doctrine has been described as discretionary — as a general practice by the courts to avoid inconsistent judgments — as opposed to a limit on the power of the courts. Foreman v Foreman, 266 Mich App 132, 138; 701 NW2d 167 (2005). However, these decisions also acknowledge this Court’s mandatory obligation to apply the doctrine when there has been no material change in the facts or intervening change in the law. Id.; see also Reeves v Cincinnati, Inc (After Remand), 208 Mich App 556, 560; 528 NW2d 787 (1995) (“[T]he doctrine of law of the case is a bright-line rule to be applied virtually without exception.”). Even if the prior decision was erroneous, that alone is insufficient to avoid application of the law of the case doctrine. Bennett v Bennett, 197 Mich App 497, 500; 496 NW2d 353 (1992); see also Driver v Hanley (After Remand), 226 Mich App 558, 565; 575 NW2d 31 (1997).
We conclude that the law of the case doctrine applies in this case regarding whether plaintiffs pleaded a proper cause of action. We previously held that plaintiffs had pleaded causes of action for which declaratory and injunctive relief could be granted, and our Supreme Court affirmed. The state has not established a material change of fact or an intervening change in the law that would allow this Court to avoid application of the law of the case doctrine and reconsider the state’s motion for summary disposition under MCR 2.116(C)(8).
The state contends that plaintiffs should be judicially estopped from relying on the law of the case doctrine because they argued before the Supreme Court that “there is no (C)(8) motion before you with respect to whether relief can be granted against the Governor.” Judicial estoppel prevents a party from asserting one position when that party “successfully and ‘unequivocally’ asserted a position in a prior proceeding that is ‘wholly inconsistent’ with the position now taken.” Szyszlo v Akowitz, 296 Mich App 40, 51; 818 NW2d 424 (2012) (citation omitted). Significantly, “the mere assertion of inconsistent positions is not sufficient to invoke estoppel; rather, there must be some indication that the court in the earlier proceeding accepted that party’s position as true. Further, in order for the doctrine of judicial estoppel to apply, the claims must be wholly inconsistent.” Paschke v Retool Indus, 445 Mich 502, 510; 519 NW2d 441 (1994). This “prior success” model “focus[es] less on the danger of inconsistent claims, than on the danger of inconsistent rulings.” Id. at 510 n 4.
Judicial estoppel does not bar plaintiffs from relying on the law of the case doctrine to preclude reconsideration of the state’s motion pursuant to MCR 2.116(C)(8) because the state has not established the requirements of judicial estoppel. Even if plaintiffs made a wholly inconsistent statement with respect to whether the state’s motion under MCR 2.116(C)(8) was before the Supreme Court (the state has certainly not denied that it appealed this Court’s ruling on the motion to the Supreme Court), the state has not shown that this assertion was successful. To the contrary, our Supreme Court affirmed this Court’s decision regarding the state’s motion for summary disposition under MCR 2.116(C)(8), albeit in result only.
Therefore, the trial court did not err by denying the state’s motion for summary disposition under MCR 2.116(C)(8).
c. standing
Next, the state argues that the trial court erred by failing to decide that plaintiffs lack standing in light of our Supreme Court’s decision in Lansing Sch Ed Ass’n v Lansing Bd of Ed, 487 Mich 349; 792 NW2d 686 (2010) (LSEA). The state insists that the intervening change in the law of standing in Michigan under LSEA precludes application of the law of the case doctrine and, therefore, allows it to reargue the question of plaintiffs’ standing. We disagree.
We review de novo the issues of standing and the application of the law of the case doctrine. Kasben, 278 Mich App at 470; Manuel v Gill, 481 Mich 637, 642-643; 753 NW2d 48 (2008).
When this case was initially decided, Michigan used the federal tripartite standing test that required a plaintiff to demonstrate the following: (1) an injury in fact that was concrete, particularized, and either actual or imminent, (2) that the injury was fairly traceable (causally linked to) the defendant’s conduct, and (3) that the remedy sought would likely redress the plaintiff’s injuries. Mich Citizens for Water Conservation v Nestlé Waters North America Inc, 479 Mich 280, 294-295; 737 NW2d 447 (2007), overruled by LSEA, 487 Mich at 378. However, our Supreme Court in LSEA reinstituted Michigan’s prior “prudential” standing test, which automatically conferred standing upon any party who has a “legal cause of action,” regardless of whether the underlying issue is justiciable. LSEA, 487 Mich at 355, 372. The Court’s return to the old standard recognized that the purpose of the doctrine was to promote “sincere and vigorous advocacy” between the parties to the dispute. Id. at 355 (citation and quotation marks omitted). “Under this approach, a litigant has standing whenever there is a legal cause of action” or the requirements of MCE 2.605 to seek a declaratory judgment are satisfied. Id. at 372. If a specific cause of action at law does not exist for the plaintiff, then the following analysis applies:
A litigant may have standing in this context if the litigant has a special injury or right, or substantial interest, that will be detrimentally affected in a manner different from the citizenry at large or if the statutory scheme implies that the Legislature intended to confer standing on the litigant. [Id.]
Although the law of the case doctrine does not necessarily apply when there has been an intervening change in the law, Sinicropi v Mazurek, 279 Mich App 455, 464-465; 760 NW2d 520 (2008), our Supreme Court clearly reinstated its original decision affirming this Court’s opinion in this case after it decided LSEA. Our Supreme Court was surely aware of the change in the law when it reinstated its prior decision. See Bennett v Weitz, 220 Mich App 295, 300; 559 NW2d 354 (1996) (“[O]ur Supreme Court presumably is aware of contrary common-law rules when fashioning court rules.”); In re Archer, 277 Mich App 71, 84; 744 NW2d 1 (2007) (“[W]e assume that the trial court knew the law ....”). The law of case doctrine, therefore, applies because the Supreme Court implicitly decided under LSEA the issue of plaintiffs’ standing. See, generally, Grievance Administrator v Lopatin, 462 Mich 235, 260; 612 NW2d 120 (2000) (explaining that the law of the case doctrine applies to issues decided — explicitly or implicitly — on appeal).
Furthermore, we reject the state’s suggestion that we discard LSEA and apply the federal standing test because the new prudential test is unworkable and could lead to a violation of the separation of powers. We are “bound by the rule of stare decisis to follow the decisions of our Supreme Court.” Tenneco Inc v Amerisure Mut Ins Co, 281 Mich App 429, 447; 761 NW2d 846 (2008).
Accordingly, the trial court properly denied the state’s motion for summary disposition with respect to standing.
D. RES JUDICATA
Finally, the state argues that the doctrine of res judicata bars plaintiffs’ claims because plaintiffs are attempting to litigate the effectiveness of their indigent criminal defense counsel in this subsequent civil action when they could or should have raised the issue of ineffective assistance of counsel during their criminal proceedings. We disagree.
This Court reviews de novo a trial court’s decision on a motion for summary disposition pursuant to MCR 2.116(C)(7) to determine whether the moving party was entitled to judgment as a matter of law. Stoudemire v Stoudemire, 248 Mich App 325, 332; 639 NW2d 274 (2001). “The applicability of the doctrine of res judicata is a question of law that is also reviewed de novo.” Id.
The doctrine of res judicata precludes relitigation of a claim when it is predicated on the same underlying transaction that was litigated in a prior case. Id. at 334. The purpose of res judicata is to prevent inconsistent decisions, conserve judicial resources, and protect vindicated parties from vexatious litigation. Pierson Sand & Gravel, Inc v Keeler Brass Co, 460 Mich 372, 380; 596 NW2d 153 (1999). Michigan employs a broad approach to the doctrine of res judicata. Id.
The elements of res judicata are as follows: (1) the prior action was decided on the merits, (2) the prior decision resulted in a final judgment, (3) both actions involved the same parties or those in privity with the parties, and (4) the issues presented in the subsequent case were or could have been decided in the prior case. Stoudemire, 248 Mich App at 334. For purposes of res judicata, parties are in privity with each other when they are “ ‘so identified in interest with another party that the first litigant represents the same legal right that the later litigant is trying to assert.’ ” Washington v Sinai Hosp of Greater Detroit, 478 Mich 412, 421; 733 NW2d 755 (2007), quoting Adair v Michigan, 470 Mich 105, 122; 680 NW2d 386 (2004).
We conclude that the state’s argument that res judicata bars plaintiffs’ claims lacks merit. Res judicata plainly applies to multiple claims arising out of a single transaction. The issues presented in this civil case regarding the state’s alleged deprivation of plaintiffs’ constitutional rights through a deficient indigent criminal defense system were not and could not have been raised in the plaintiffs’ individual criminal prosecutions. See Stoudemire, 248 Mich App at 334. The remedy that plaintiffs seek through a class action, i.e., improvements to the indigent criminal defense system, could not have been achieved during plaintiffs’ prior criminal proceedings. Without an action such as this, and assuming that plaintiffs’ allegations are true, indigent persons who are accused of crimes in Michigan will continue to be subject to inadequate legal representation without remedy unless the representation adversely affects the outcome. Our system of justice requires effective representation, not ineffective but non-outcome-determinative representation. Further, as plaintiffs’ proposed class includes indigent people who may not have been convicted of crimes, there has been no final decision on the merits in those cases. See id.
Affirmed. We lift the stay previously imposed by this Court and do not retain jurisdiction.
Fitzgerald, J., concurred with Beckering, J.
Indeed, when explaining that a court must examine “additional information beyond the pleadings” if the pleadings are insufficient to determine whether class certification is proper, the Henry Court expressly referred to a trial court’s authority to permit discovery under MCR 3.501(B)(3)(b). Henry, 484 Mich at 503 & n 35.
Plaintiffs explain that the comment at issue pertained not to whether any (C)(8) motion was pending before the Supreme Court, but to Justice Corrigan’s concern about whether these defendants were the proper parties, as compared to “the local funding units that are supposed to fund indigent defense in the counties,” to which plaintiffs’ counsel indicated that the state had not sought to dismiss the case on this basis.
The state contends that the language of the April 30, 2010 Supreme Court order is far more reflective of what one might expect concerning a motion for summary disposition pursuant to MCR 2.116(0(10), but clearly, discovery had not yet taken place and the state had never filed a motion for summary disposition under MCR 2.116(0(10).
In LSEA, the Supreme Court restored Michigan’s standing jurisprudence to a limited, prudential doctrine that is less stringent than the prior federal standing test. The state has not shown how the prior rulings on standing were affected by LSEA-, indeed, it appears that the change in the law concerning standing would favor plaintiffs’ case and not the state’s. | [
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] |
PER CURIAM.
Plaintiffs, Anthony L. Barclae, CYNBA International, Inc., and Robot Defined, LLC, appeal as of right an order granting summary disposition in favor of defendant, Ernest Zarb. We affirm.
I. BASIC FACTS AND PROCEDURAL HISTORY
Some basic facts of this case were set forth in a prior appeal:
According to plaintiffs, Robot Printing, Inc., and Robot Properties, L.L.C., were businesses that needed working capital in 2007, but their assets were collateral for Comerica Bank loans. Further according to plaintiffs, Zarb (a senior vice president for Comerica Bank) made fraudulent misrepresentations to plaintiffs in April 2007 to induce them “to advance hundreds of thousands of dollars” for these assets to, and for the benefit of, Robot Printing, Inc., Robot Properties, L.L.C., and Comerica Bank. In return for the advance, plaintiffs expected to collect Robot Printing, Inc.’s receivables after April 17, 2007.
After the allegedly fraudulent misrepresentations by Zarb were made, on May 4, 2007, Robot Defined and Comerica Bank entered into a debt purchase agreement. According to the agreement, Robot Defined agreed to purchase outstanding loans made by Comerica Bank to Robot Printing Inc. and Robot Properties, L.L.C. The outstanding principal on the loan notes exceeded $7,000,000.00. The purchase price was the amount outstanding on the notes, less $800,000 (and certain fees). On the same day, a forbearance agreement was executed. In that agreement, Comerica Bank agreed to “forbear from taking action” in regard to defaults on the loans at issue in the debt purchase agreement. [Barclae v Zarb, unpublished opinion per curiam of the Court of Appeals, issued January 18, 2011 (Docket No. 289878), p l.][ ]
While the appeal was pending, plaintiffs filed a second amended complaint. The second amended complaint refers to the “Robocolor Process” — an intangible property “involving a potentially patentable printing process of substantial commercial value that was not available to Robot Printing’s competitors.” The second amended, complaint alleged that Robot Printing sold the Robocolor Process in order to reduce the debt owed to Comerica and to procure working capital, an act that clearly benefitted Comerica. When plaintiffs were presented with the opportunity to purchase some of Robot Printing’s assets in March 2007, they were unaware that the Robocolor Process had been sold and was no longer an asset. Plaintiffs alleged that, in spite of Comerica’s knowledge of the sale, Zarb represented that plaintiffs could purchase Robot Printing’s assets “including without limitation the Robocolor Process (whether by taking possession of the collateral and selling it as a secured creditor or by consenting to Robot’s sale of the assets and applying sales proceeds to Robots’ debt to Bank).” In addition, although plaintiffs had hoped to purchase Robot Printing’s assets, Comerica demanded that plaintiffs “purchase all of Bank’s rights against Robot and their guarantors for additional millions of dollars,” effectively converting an “asset sale” into a “debt sale.”
In the meantime, Comerica filed a suit against Robot Defined, alleging breach of contract and seeking indemnification for losses arising out of Robot Defined’s failure to consummate the debt sale agreement. Robot Defined counterclaimed for the loss of money it advanced to Robot Printing as a result of Comerica’s fraud. Robot Defined alleged in its first amended counterclaim that “[throughout April 2007, Bank made a series of misrepresentations that Bank had the present intent and ability to cause the sale of certain assets of Robot [Printing], including without limitation the Robocolor Process (whether by taking possession of the collateral and selling it as a secured creditor or by consenting to Robot’s sale of the assets and applying sales proceeds to Robot’s debt to Bank).” Robot Defined further alleged that the bank wrongfully retained Robot Printing’s receivables generated after April 17, 2007, which should have been applied to Robot Defined’s working capital. Robot Defined alleged breach of contract, fraud, conversion, and unjust enrichment. It also alleged that Comerica had retained Robot Defined’s $500,000 nonrefundable deposit and that the bank had, therefore, elected its remedy against Robot Defined and could not seek indemnification. The trial court consolidated the two cases, retaining the title and docket number of the action brought by Barclae.
Zarb moved for summary disposition on plaintiffs’ claims, arguing that the statute of frauds, MCL 566.132, precluded plaintiffs from bringing an action for breach of alleged oral representations regarding financial accommodations. Zarb argued that, as an employee of Comerica, he was protected under the statute by basic agency principles. Additionally, Zarb argued that neither Barclae nor CYNBA had standing to bring the action because they were mere investors in Robot Defined, and Robot Defined was the only plaintiff who was a party to the debt sales agreement. Further, because of the merger clause in the parties’ agreement, Robot Defined was also barred from bringing its claims regarding prior oral promises.
Comerica moved for partial summary disposition with regard to the majority of Robot Defined’s counterclaims. Citing MCL 566.132, the statute of frauds, Comerica argued that Robot Defined was in no position to seek enforcement of any alleged oral agreements. Contrary to plaintiffs’ contentions, the handwritten notes taken by Zarb at one of the meetings during the negotiation process did not establish a contract for purposes of circumventing the statute of frauds. Additionally, Comerica argued that the merger clause in the debt sale agreement barred evidence of any other agreement. Comerica also argued that there could be no claim for conversion because Robot Defined failed to allege that the bank had an obligation to return “specific money.” Comerica also pointed out that, pursuant to the debt sales agreement, Robot Defined had disclaimed any reliance on any statements or representations made by the bank’s employees. Comerica argued that it was not unjustly enriched because there was no evidence that Robot Defined’s investment increased the liquidation value of Robot Printing’s assets. Finally, Comerica maintained that the language of the parties’ agreement did not show an intention to limit Comerica’s damages to the nonrefundable deposit; instead, the $500,000 deposit was forfeited as a penalty.
Plaintiffs filed separate responses opposing both Zarb’s motion for summary disposition and Comerica’s motion for partial summary disposition. Plaintiffs pointed out that when a debtor like Robot Printing defaults on a debt, a bank would generally either sell its debt instruments or conduct an “Article 9 sale” of collateral. Robot Printing needed working capital during the economic downturn, so with Comerica’s encouragement, Robot Printing sold its Robocolor Process to a nonparty, RoboColor, L.L.C. With the sale, Robot Printing was able to stay in business and generate new receivables, to the benefit of Comerica. Plaintiffs hoped to purchase the Robocolor Process in an Article 9 sale. At the time, plaintiffs had no idea that the process had already been sold, yet Zarb made a series of statements that the bank was in a position to sell Robot Printing’s assets. Zarb even generated a “present agreement” at the parties April 20, 2007, meeting, but then later did an “about face” and refused to proceed with the sale until plaintiffs agreed to purchase the debt instruments. Plaintiffs were put in a position whereby they would lose the many thousands of dollars already invested in Robot Printing to keep it “afloat” if they did not sign the agreement on Zarb’s terms. However, Zarb knew that the Robocolor Process had been sold months earlier at the bank’s request and for its benefit. “So, in this action, Plaintiffs seek damages from Zarb, not the Bank, for his fraudulent misrepresentations (admittedly beyond his authority as a Bank officer) about the intent and ability to sell Printing assets (not the Bank’s deht instruments).”
Plaintiffs argued that, contrary to Zarb’s assertion, plaintiffs had standing to bring the lawsuit. Plaintiffs alleged that Anthony Barclae and CYNBA were not merely investors of Robot Defined; rather, they directly advanced over $1 million to Robot Printing and its creditors and were directly damaged by Zarb’s deceit.
Plaintiffs also denied that their claims were barred by MCL 566.132. Plaintiffs were not seeking to enforce any agreement; instead, they sought damages for money advanced to Robot Printing before the May 4, 2007, agreement was executed. Additionally, the statute applies only to the “financial accommodations” relating to loans and extensions of credit. Zarb was not a “financial institution” or “affiliate” within the meaning of the statute. To the extent the statute might apply, plaintiffs argued that Zarb’s April 20, 2007, “present agreement” satisfied the writing requirement of the statute.
Finally, plaintiffs argued that the merger clause in the parties’ agreement did not bar plaintiffs’ claims because the merger clause only referred to prior agreements or understandings with respect to the debt sale and does not mention prior agreements relating to the sale of Robot Printing’s assets. Even if the merger clause applied, the bank’s fraudulent conduct vitiated the agreement. Further, neither Barclae nor CYNBA were parties to the contract and the merger clause is not binding on them.
The trial court granted the motions, holding:
And in reviewing the — reviewing the statute [and] the case law, it’s this court’s opinion that — that this statute is applicable in this case.
And that — that this was a financial accommodation. That Mr. Zarb was an affiliate of the bank.
And, therefore, I’m going to grant the motion for summary disposition as to Mr. Zarb. Since the contract was not in writing.
It was purported to be in writing. There was some kind of -- some figures that were jotted down during some discussion that was — had the - had the printed name of Mr. Zarb in the upper right hand corner, I think it was his first name only.
And it was purported that that may have been sufficient to satisfy the statute of frauds.
However, it’s this court’s conclusion that that does not. It’s simply notes pursuant to negotiations.
If it doesn’t satisfy the elements of the contract, it’s not signed and, therefore, I’m going to grant the motion.
Mr. [C. William] Garratt [counsel for plaintiffs]: So is it your Honor’s ruling that each and every cause of action against Mr. Zarb is dismissed or merely those that sound, in essence, in contract?
The Court: Well, it appears - it - each and every one. Each and every one. And similarly with the bank, pursuant to the same statute.
Mr. [Robert] Brower [counsel for Zarb and Comerica]: That would be on the counter-claim against the bank.
The Court: Right.
Mr. Brower: I understand the court’s ruling.
Mr. Garratt: So every claim — every claim, no matter how it sounds —
The Court: (Interposing) Right.
Mr. Garratt: — under whatever theory against the bank by Robot Defined is dismissed?
The Court: Right.
The only issue remaining in the consolidated cases was Comerica’s indemnity claim against Robot Defined. The trial court entered an order dismissing plaintiffs’ claims against Zarb and counterclaims against Comerica on August 12, 2010. Plaintiffs now appeal as of right.
II. STANDARDS OF REVIEW
We review de novo a trial court’s decision on a motion for summary disposition. Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). A motion for summary disposition pursuant to MCR 2.116(C)(10) tests the factual sufficiency of the complaint. Corley v Detroit Bd of Ed, 470 Mich 274, 278; 681 NW2d 342 (2004). We must review a “motion brought under MCR 2.116(0(10) by considering the pleadings, admissions, and other evidence submitted by the parties in the light most favorable to the nonmoving party.” Latham v Barton Malow Co, 480 Mich 105, 111; 746 NW2d 868 (2008). “There is a genuine issue of material fact when reasonable minds could differ on an issue after viewing the record in the light most favorable to the nonmoving party.” Allison v AEW Capital Mgt, LLP, 481 Mich 419, 425; 751 NW2d 8 (2008).
We also review de novo matters of statutory interpretation. Stanton v Battle Creek, 466 Mich 611, 614; 647 NW2d 508 (2002). The goal of statutory interpretation is to discern and give effect to the intent of the Legislature. Odom v Wayne Co, 482 Mich 459,467; 760 NW2d 217 (2008). To that end, the first step in determining legislative intent is the language of the statute. Id. If the statutory language is unambiguous, then the Leg islature’s intent is clear and judicial construction is neither necessary nor permitted. Id.
Finally, the question of standing is a question of law that we review de novo on appeal. Young v Indep Bank, 294 Mich App 141, 143; 818 NW2d 406 (2011).
III. STATUTE OF FRAUDS
Plaintiffs first argue that the trial court erred by applying MCL 566.132 to their claims. We disagree.
The statute of frauds, MCL 566.132, provides, in relevant part:
(2) An action shall not be brought against a financial institution to enforce any of the following promises or commitments of the financial institution unless the promise or commitment is in writing and signed with an authorized signature by the financial institution:
(a) A promise or commitment to lend money, grant or extend credit, or make any other financial accommodation.
Ob) A promise or commitment to renew, extend, modify, or permit a delay in repayment or performance of a loan, extension of credit, or other financial accommodation.
(c) A promise or commitment to waive a provision of a loan, extension of credit, or other financial accommodation.
(3) As used in subsection (2), “financial institution” means a state or national chartered bank, a state or federal chartered savings bank or savings and loan association, a state or federal chartered credit union, a person licensed or registered under the mortgage brokers, lenders, and servicers licensing act, Act No. 173 of the Public Acts of 1987, being sections 445.1651 to 445.1683 of the Michigan Compiled Laws, or Act No. 125 of the Public Acts of 1981, being sections 493.51 to 493.81 of the Michigan Compiled Laws, or an affiliate or subsidiary thereof.
“[T]he role of the judiciary is to apply the statute of frauds as written, without second-guessing the wisdom of the Legislature.” Crown Technology Park v D&N Bank, FSB, 242 Mich App 538, 548 n 4; 619 NW2d 66 (2000). The language of the statute is unambiguous. “It plainly states that a party is precluded from bringing a claim — no matter its label — against a financial institution to enforce the terms of an oral promise to waive a loan provision.” Id. at 550 (concluding that promissory estoppel actions are barred under the statute). “[T]he Legislature used the broadest possible language ... to protect financial institutions by not specifying the types of ‘actions’ it prohibits, eliminating the possibility of creative pleading to avoid the ban.” Id. at 551.
A. WAS THERE A FINANCIAL ACCOMMODATION?
Plaintiffs argue that there was no “financial accommodation” because Comerica did not “advance funds at a risk of loss.”
“Financial accommodation” is not defined in MCL 566.132(2). This Court will “give undefined statutory terms their plain and ordinary meanings” and, in doing so, may consult dictionaries. Koontz v Ameritech Servs, Inc, 466 Mich 304, 312; 645 NW2d 34 (2002). In defining an undefined term, this Court must also consider its placement and purpose in the statutory scheme. Herman v Berrien Co, 481 Mich 352, 366; 750 NW2d 570 (2008). In FEI Co v Republic Bank, unpublished opinion per curiam of the Court of Appeals, issued August 10, 2006 (Docket No. 268700), p 2, this Court explained:
The statute does not define “financial accommodation,” but plaintiff admits that it was an “accommodation.” According to Random, House Webster’s College Dictionary (1997), “financial” means “of or pertaining to those commonly engaged in dealing with money and credit.” An agreement to delay a sheriffs foreclosure sale constitutes an accommodation pertaining to those engaged in dealing with money and credit, because a delay in a foreclosure sale is an accommodation that would be made by a lender or creditor. Therefore, an agreement to delay a foreclosure sale is an agreement to make a “financial accommodation” within the scope of MCL 566.132(2)(a).
We recognize that the FEI case is unpublished and, therefore, not binding precedent on this Court, MCR 7.215(C)(1); nevertheless, we find it to be both instructive and persuasive and, therefore, adopt its analysis. See Paris Meadows, LLC v City of Kentwood, 287 Mich App 136, 145 n 3; 783 NW2d 133 (2010).
Additionally, in Williams v Pledged Property II, LLC, 2012 WL 6200270 (CA 6, 2012), the United States Court of Appeals for the Sixth Circuit rejected the notion that a “financial accommodation” requires that a bank be exposed to a risk of loss in order for the writing requirement to be triggered. Id. at 3. Citing FEI, the court, id., noted that “the Michigan Court of Appeals has clearly interpreted [MCL 566.132(2)] to include promises to delay foreclosure sales, holding that ‘an agreement to delay a foreclosure sale is an agreement to make a “financial accommodation.” ’ ”
There was clearly a “financial accommodation” in this case. The bank, through Zarb, agreed that it would not pursue immediate liquidation of Robot Printing’s assets, even though Robot Printing had defaulted on its loan obligations. An agreement to temporarily not seize collateral was a financial accommodation that no doubt benefited Robot Printing, but similarly benefited plaintiffs, who were hoping to take over the business and make it a going concern. The fact that Comerica did not place itself at additional risk of exposure is not dispositive.
B. DOES THE APRIL 20 “PRESENT AGREEMENT” SATISFY THE WRITING REQUIREMENT OF MCL 566.132(2)?
Plaintiffs argue that, if the statute of frauds does apply, then the parties’ April 20, 2007, “present agreement” satisfies the writing requirement.
“Our Supreme Court has declined to adopt narrow and rigid rules for compliance with the statute of frauds.” Kelly-Stehney & Assoc, Inc v MacDonald’s Indus Prod, Inc (On Remand), 265 Mich App 105, 111; 693 NW2d 394 (2005). To satisfy the statute of frauds, a writing need not contain all the terms of the agreement to be enforceable, and the writing may be considered with the admitted facts and extrinsic evidence showing the surrounding circumstances. Id. at 114. For that reason, a case-by-case approach is necessary — “[s]ome note or memorandum having substantial probative value in establishing the contract must exist; but its sufficiency in attaining the purpose of the statute [of frauds] depends in each case upon the setting in which it is found.” Opdyke Investment Co v Norris Grain Co, 413 Mich 354, 368; 320 NW2d 836 (1982) (quotation marks and citation omitted).
We should always be satisfied with some note or memorandum that is adequate, when considered with the admitted facts, the surrounding circumstances, and all explanatory and corroborative and rebutting evidence, to convince the court that there is no serious possibility of consummating a fraud by enforcement. When the mind of the court has reached such a conviction as that, it neither promotes justice nor lends respect to the statute to refuse enforcement because of informal ity in the memorandum or its incompleteness in detail. [.Kelly-Stehney, 265 Mich App at 114 (quotation marks, brackets, and citation omitted).]
To satisfy the statute of frauds, the Restatement Second provides that a writing must contain the following elements:
Unless additional requirements are prescribed by the particular statute, a contract within the Statute of Frauds is enforceable if it is evidenced by any writing, signed by or on behalf of the party to be charged, which
(a) reasonably identifies the subject matter of the contract,
(b) is sufficient to indicate that a contract with respect thereto has been made between the parties or offered by the signer to the other party, and
(c) states with reasonable certainty the essential terms of the unperformed promises in the contract. [1 Restatement Contracts, 2d, § 131, p 334.]
Even taking the evidence in a light most favorable to plaintiffs, the parties’ April 20 “agreement” does not meet the signed writing requirement of MCL 566.132. A valid contract requires: (1) parties competent to contract, (2) a proper subject matter, (3) legal consideration, (4) mutuality of agreement, and (5) mutuality of obligation. Mallory v Detroit, 181 Mich App 121, 127; 449 NW2d 115 (1989). Here, there was no mutuality of agreement. Although the document refers to the parties’ “present agreement,” it also includes terms and phrases such as “New Debt Sale,” “take this deal,” and a number of handwritten items. “ERNIE” is handwritten in the top-right corner of the document. Even if the name satisfied the signing requirement, the document is clearly a reflection of ongoing negotiations and, therefore, the trial court properly concluded that the document did not satisfy the statute of frauds.
C. CAN ZARB AVAIL HIMSELF OF MCL 566.132(3)?
Plaintiffs argue that Zarb was neither a “financial institution” nor an “affiliate” under the statute. They claim: “If a bank’s officer or employee were to be deemed, ‘a financial institution’ within the meaning of MCL 566.132(3), the Legislature would have included ‘officers’ or ‘employees’ in the definition of ‘financial institution.’ ” Additionally, plaintiffs claim that an “affiliate” is limited to those who are affiliates of licensees under the Mortgage Brokers, Lenders, and Servicers Licensing Act, MCL 445.1651 etseq. (mortgage brokers, lenders, and servicers).
We conclude that, although the trial court and the parties discussed whether Zarb could be considered an “affiliate” under MCL 566.132(3), such an inquiry was unnecessary. Basic agency principles allow Zarb to assert the statute of frauds defense.
Plaintiffs do not dispute that Comerica is a “financial institution” as defined in MCL 566.132(3). Because a corporation may only act through its officers and agents, an agency relationship exists between a corporation and its officers. In re Moroun, 295 Mich App 312, 332; 814 NW2d 319 (2012). Anthony Barclae testified that he ascertained whether Zarb “really [could] negotiate this deal.” “I assumed that [Zarb] was a representative of Comerica Bank and he was representing Comerica Bank and - not so much himself. He was a bank representative.” Barclae acknowledged that Zarb had the authority to bind the bank.
Agency principles were discussed in the prior appeal:
Next, plaintiffs claim that because Zarb did not sign the debt purchase agreement and forbearance agreement, he cannot invoke the jury trial waivers in the agreements. We agree.
We conclude that, according to the plain language of the waiver provisions, “each party” agreed to waive any right to trial by jury. In Zarb’s answer to plaintiffs [sic] complaint, he admitted that he was not a party to the agreement between Robot Defined and Comerica Bank. To interpret these waivers to apply to Zarb, this Court would he required to rewrite the plain language of the clauses to not only apply to “each party,” but also “agents of each party.” Such an interpretation would render language referencing the parties and their agents elsewhere in the agreements surplusage.
Our conclusion with respect to [these] jury trial waivers also corresponds with traditional agency theory. A contract between a principal and a third party is enforceable by the principal against the third party. 3 Am Jur 2d, Corporations, § 313. Only where an agent contracts with the party on behalf of the principal, but in the agent’s own name “or in such manner as to make it the agent’s personal contract,” can the agent sue in his own name to enforce the contract. Here, Comerica Bank could invoke the jury trial waiver, but because Zarb did not sign the agreements as an individual or make the agreements his own personal contracts, Zarb cannot invoke the jury trial waiver as an individual. Thus, the trial court erred when it granted Zarb’s motion to strike plaintiffs’ jury trial demand. [Barclae, unpub op at 3-5 (some citations omitted).]
Because of this Court’s prior decision, it is the law of the case that Zarb was acting as an agent of Comerica during the parties’ negotiations.
Under the law of the case doctrine, if an appellate court resolves a legal issue and remands to the trial court for further proceedings, the legal question determined by the appellate court will not be decided differently in a subsequent appeal in the same case if the facts remain materially the same. Stated another way, the doctrine is applied when the prior appeal involves the same set of facts, the same parties, and the same question of law ... .[In re Petition by Wayne Co Treasurer, 265 Mich App 285, 297; 698 NW2d 879 (2005) (quotation marks and citations omitted).]
Although the issue in the prior appeal related to a jury waiver in the parties’ agreement, the same legal question was involved — that being Zarb’s status as an agent of Comerica. There is no question that Zarb was acting on Comerica’s behalf when negotiating with plaintiffs. Plaintiffs also admit the agency relationship. They must, because Robot Defined’s numerous counterclaims against Comerica are founded on such agency principles.
Plaintiffs argue that MCL 566.132(3) does not specifically include an “employee” of a financial institution and, therefore, Zarb cannot avail himself of the statute of frauds defense. We disagree. A financial institution can only act through its agents, principals, and employees. If agents and employees of a financial institution were not included within the statute, then it would render that portion of the statute useless. This Court must avoid interpreting statutes in a manner that would render any part of the statute nugatory. Robinson v City of Lansing, 486 Mich 1, 21; 782 NW2d 171 (2010). If employees of financial institutions were not protected, the statute of frauds could be easily circumvented merely by suing employees of a financial institution. Given that Zarb was an agent for Comerica at the time of the parties’ negotiations, he may avail himself of the defense of the statute of frauds.
D. DOES PART PERFORMANCE PRECLUDE APPLICATION OF MCL 566.132?
Finally, plaintiffs argue that, if the statute of frauds applies, it was rendered inapplicable because of part performance. Plaintiffs maintain that they relied on Zarb’s fraudulent statements and “paid him hundreds of thousands of dollars to and for [Robot] Printing and for Comerica’s benefit.”
If one party to an oral contract, in reliance upon the contract, has performed his obligation thereunder so that it would be a fraud upon him to allow the other party to repudiate the contract, by interposing the statute, equity will regard the contract as removed from the operation of the statute. The contract to be enforced must be established by clear and convincing evidence. [Guzorek v Williams, 300 Mich 633, 638-639; 2 NW2d 796 (1942) (citations omitted).][ ]
Plaintiffs never performed any aspect of the alleged agreement; instead, plaintiffs voluntarily infused Robot Printing with cash at their own peril. They were under no obligation to do so. The record “discloses merely that plaintiff did some things which were preliminary to the performance or execution of the contract, not that he did them in performance of the contract.... [T]he acts which plaintiff now attempts to assert were partial performance of the contract, were nothing more than activities preliminary to any performance or partial performance under the contract itself.” Cassidy v KraftPhenix Cheese Corp, 285 Mich 426, 432-433; 280 NW 814 (1938). Because plaintiffs can cite no provision of the “agreement” that they performed, their claim of partial performance must fail.
IV PLAINTIFFS’ FRAUD CLAIM AGAINST ZARB
Although the trial court did not address the issue, plaintiffs argue that they properly alleged a fraud claim. Plaintiffs argue that: (1) Zarb made fraudulent misrepresentations that he had the present ability to sell Robot Printing’s assets, (2) the statements were made in bad faith, (3) Zarb knew they were false and intended that plaintiffs rely on the statements, and (4) plaintiffs did, in fact, rely on the statements and advanced money to Robot Printing to their detriment. We disagree.
There are three interrelated fraud doctrines: (1) fraudulent misrepresentation, (2) innocent misrepresentation, and (3) silent fraud. Titan Ins Co v Hyten, 491 Mich 547, 555; 817 NW2d 562 (2012). Plaintiffs allege that, separate and apart from the parties’ written and oral agreements, Zarb’s fraudulent claims caused them to continuously infuse Robot Printing with operating funds.
Common-law fraud or fraudulent misrepresentation entails a defendant making a false representation of material fact with the intention that the plaintiff would rely on it, the defendant either knowing at the time that the representation was false or making it with reckless disregard for its accuracy, and the plaintiff actually relying on the representation and suffering damage as a result. Silent fraud is essentially the same except that it is based on a defendant suppressing a material fact that he or she was legally obligated to disclose, rather than making an affirmative misrepresentation. Such a duty may arise by law or by equity; an example of the latter is a buyer making a direct inquiry or expressing a particularized concern. A misleadingly incomplete response to an inquiry can constitute silent fraud. A claim for negligent misrepresentation requires plaintiff to prove that a party justifiably relied to his detriment on information prepared without reasonable care by one who owed the relying party a duty of care.
Silent fraud and negligent misrepresentation both require a defendant to owe a duty to the plaintiff. Defendants rely on this Court’s explanation in McMullen v Joldersma, 174 Mich App 207, 212; 435 NW2d 428 (1988), that Michigan jurisprudence had never imposed on sellers’ agents a duty per se of disclosure to buyers, in contrast to the duty it has imposed on sellers themselves. However, a duty of disclosure may be imposed on a seller’s agent to disclose newly acquired information that is recognized by the agent as rendering a prior affirmative statement untrue or misleading. This is especially true when the agent knows that the buyer has a particular concern with the subject matter of that statement. Indeed, a duty to disclose may arise solely because the buyers express a particularized concern or directly inquire of the seller .... [Alfieri v Bertorelli, 295 Mich App 189, 193-194; 813 NW2d 772 (2012) (quotation marks and citations omitted).]
Even though plaintiffs couch their claims in terms of “fraudulent misrepresentation,” their real claim is for silent fraud. They do not argue that Zarb made affirmative statements regarding the Robocolor Process; instead, they argue that Zarb remained silent on the issue and failed to disclose that the patented process had been sold. In order to maintain an action for silent fraud, “the plaintiff must show that the defendant suppressed the truth with the intent to defraud the plaintiff and that the defendant had a legal or equitable duty of disclosure. A plaintiff cannot merely prove that the defendant failed to disclose something; instead, a plaintiff must show some type of representation by words or actions that was false or misleading and was intended to deceive.” Lucas v Awaad, 299 Mich App 345, 363-364; 830 NW2d 141 (2013) (quotation marks and citations omitted). Thus, “[w]hile duty is irrelevant in a fraud claim, it is relevant in a silent fraud claim” and “in order for the suppression of information to constitute silent fraud there must exist a legal or equitable duty of disclosure.” Id. at 364 (quotation marks and citations omitted).
Plaintiffs’ silent fraud claim must fail for two reasons: they cannot prove that Zarb owed them a duty to reveal the information nor can they demonstrate that Zarb’s failure to disclose was calculated to defraud plaintiffs. Taking the deposition testimony in a light most favorable to plaintiffs, Zarb acknowledged that he was aware that the patented process was important to plaintiffs because plaintiffs believed that the process would generate substantial profits for Robot Printing. That the process was owned by an affiliate of Robot Printing did not keep Robot Printing from utilizing the technology and profiting from it. Additionally, as Zarb testified, the bank held an all-asset security interest in Robot Printing, including its intangibles. There is nothing in the record that would indicate that the bank discharged the collateral.
Additionally, plaintiffs cannot demonstrate that their “damages” were the result of the alleged fraud. Before they even met Zarb, plaintiffs had infused Robot Printing with over $150,000 in operating capital. Plaintiffs entered into a debt sale contract that required them to purchase accounts receivable that they could not subsequently finance. Their deposition testimony focused on the issue of accounts receivable and whether the bank properly applied Robot Printing’s post-April 17 receivables to Robot Defined’s operating capital. At no time during Anthony Barclae’s or Peter Barclae’s deposition do they take issue with “losing” the Robocolor Process. Thus, even if the patented process itself was owned by another company (which was affiliated with Robot Printing), there is no indication from the record that plaintiffs’ decision to continuously fund Robot Printing had anything whatsoever to do with the al leged fraud. “In a fraud and misrepresentation action, the tortfeasor is liable for injuries resulting from his wrongful act, whether foreseeable or not, provided that the damages are the legal and natural consequences of the wrongful act and might reasonably have been anticipated.” Phinney v Perlmutter, 222 Mich App 513, 532; 564 NW2d 532 (1997).
V THE MERGER CLAUSE
Plaintiffs argue that the merger clause in the parties’ May 4, 2007, debt sale agreement was inapplicable to Zarb, who was not a party to the contract. Additionally plaintiffs argue that the merger clause was void because they were fraudulently induced into entering into the contract.
Paragraph 13 of the parties’ May 4, 2007, debt sale agreement provided, in relevant part:
This Agreement sets forth the entire agreement and understanding of the parties, and supersedes all prior agreements and understandings between the parties with respect to the assignment.
The May 4, 2007, agreement also provided:
Assignee [Robot Defined] (i) has such knowledge and experience in financial matters that it is capable for evaluating the merits and risks of the purchase of the Notes and other Loan Documents; (ii) is knowledgeable regarding the financial status of Borrower, the Transferred Documents and all of Borrower’s assets; (iii) has agreed to purchase the Notes and Assignor’s interest in the Transferred Documents on the basis of its own independent investigation, evaluation and credit determination and has not sought or relied upon any representation or warranty from Assignor (except those representations expressly stated in Section 5 of this Agreement) or information provided by or statements made by Assignor or its representatives; and (iv) is purchasing the Notes for Assignee’s own account and not with a view to, or for sale in connection with, any public distribution which would violate applicable securities laws.
“ ‘Parol evidence of contract negotiations, or of prior or contemporaneous agreements that contradict or vary the written contract, is not admissible to vary the terms of a contract which is clear and unambiguous.’ ” UAW-GM Human Resources Ctr v KSL Recreation Corp, 228 Mich App 486, 492; 579 NW2d 411 (1998), quoting Schmude Oil Co v Omar Operating Co, 184 Mich App 574, 580; 458 NW2d 659 (1990). When a contract contains “an explicit integration clause” parol evidence is inadmissible to determine whether the contract was integrated. UAW-GM, 228 Mich App at 494.
However, plaintiffs do not argue that there is a conflict over the terms of a valid contract; rather, plaintiffs argue that there is no legal contract because it was fraudulently obtained. “ ‘Fraud .. . makes a contract voidable at the instance of the innocent party’ ” and parol evidence may be admissible to demonstrate fraud. Id. at 503, quoting 3 Corbin, Contracts, § 580, p 431. Nevertheless, where there is a valid merger clause “only certain types of fraud would vitiate the contract.” Id.
[Wlhile parol evidence is generally admissible to prove fraud, fraud that relates solely to an oral agreement that was nullified by a valid merger clause would have no effect on the validity of the contract. Thus, when a contract contains a valid merger clause, the only fraud that could vitiate the contract is fraud that would invalidate the merger clause itself, i.e., fraud relating to the merger clause or fraud that invalidates the entire contract including the merger clause. [Id.]
“Fraud in the procurement of the contract may be . . . grounds to retroactively avoid contractual obligations through traditional legal and equitable remedies such as cancellation, rescission, or reformation . ..Titan Ins, 491 Mich at 557-558.
There is an important distinction between (a) representations of fact made by one party to another to induce that party to enter into a contract, and (b) collateral agreements or understandings between two parties that are not expressed in a written contract. It is only the latter that are eviscerated by a merger clause, even if such were the product of misrepresentation. It stretches the UAW-GM ruling too far to say that any pre-contractual factual misrepresentations made by a party to a contract are wiped away by simply including a merger clause in the final contract. Such a holding would provide protection for disreputable parties who knowingly submit false accountings, doctored credentials and/or already encumbered properties as security to unknowing parties as long as they were savvy enough to include a merger clause in their contracts. In fact, the UAW-GM court considered the effect of fraud allegations on a contract with a merger clause and determined that evidence was admissible to prove fraud that would “invalidate the merger clause itself, i.e., fraud relating to the merger clause or fraud that invalidates the entire contract including the merger clause. 3 Corbin, Contracts, § 578.” [UAW-GM, 228 Mich App] at 503. Further, the section of Corbin On Contracts cited by UAW-GM, § 578, states that a merger clause “even though it is contained in a complete and accurate integration does not prevent proof of fraudulent misrepresentations by a party to the contract, or of illegality, accident or mistake.” 6 Corbin, Contracts, § 578, p. 114 (reprinted as published in the 1960 edition of Volume 3). Corbin goes on to explain[:]
“Fraud in the inducement of assent . .. may make the contract voidable without... showing that the writing was not agreed on as a complete integration of its terms. In such case the offered testimony may not vary or contradict the terms of the writing, although it would be admissible even if it did so; it merely proves the existence of collateral factors that have a legal operation of their own, one that prevents the written contract from having the full legal operation that it would otherwise have had. This is not varying or contradicting the written terms of agreement, although it does vary or nullify in part their legal effect.” 3 Corbin, Contracts § 580, p. 142 (emphasis added).
In sum, the UAW-GM court did not bar a fraud claim in all cases in which the underlying contract has a merger clause, the court simply held that in that case the “plaintiff made no allegations of fraud that would invalidate the contract or the merger clause.” Id. at 505. The question then is, when does fraud invalidate an entire contract, and when is it such that it provides no remedy or recourse if there is a written contract with a merger clause?
The Restatement 2nd of Contracts explains that if, “a party’s manifestation of assent is induced by either a fraudulent or a material misrepresentation by the other party upon which the recipient is justified in relying, the contract is voidable by the recipient.” Rest. 2d Contr. § 164. The answer to the question posed is, therefore, fraud will invalidate a contract when a party’s assent to said contract is induced through justified reliance upon a fraudulent misrepresentation. A merger clause can render reliance unjustified as to agreements, promises or understandings related to performances that are not included in the written agreement. [Star Ins Co v United Commercial Ins Agency, Inc, 392 F Supp 2d 927, 928-929 (ED Mich, 2005) (some emphasis omitted).]
Plaintiffs allege that, although Zarb realized that they were particularly interested in the Robocolor Process, Zarb failed to inform plaintiffs that the process had been sold. They argue that the debt sale agreement itself was voidable at their discretion because of Zarb’s misrepresentations regarding Robot Printing’s assets. Because plaintiffs do not seek to add to or vary the terms of the May 4 contract, parol evidence may be introduced ■ to show that plaintiffs were fraudulently induced into signing the agreement. However, as previously discussed, plaintiffs’ claim will still fail. Thus, while it appears that the merger clause may not stand as a bar to plaintiffs’ claim, plaintiffs’ claim fails for other reasons.
VI. DO ANTHONY BARCLAE AND CYNBA HAVE STANDING TO BRING THEIR CLAIM?
Although not addressed by the trial court, plaintiffs argue that, contrary to Zarb’s assertions, their claim was not merely derivative of Robot Defined’s claim.
“To have standing, a party must have a legally protected interest that is in jeopardy of being adversely affected.” Dep’t of Treasury v Comerica Bank, 201 Mich App 318, 329-330; 506 NW2d 283 (1993). A plaintiff must have “a special injury or right, or substantial interest, that will be detrimentally affected in a manner different from the citizenry at large . .. .” Lansing Sch Ed Ass’n v Lansing Bd of Ed, 487 Mich 349, 372; 792 NW2d 686 (2010). “A plaintiff must assert his own legal rights and interests and cannot rest his claim to relief on the legal rights or interests of third parties.” Fieger v Comm’r of Ins, 174 Mich App 467,471; 437 NW2d 271 (1988).
MCR 2.201(B) requires that, generally, an action must be prosecuted in the name of the real party in interest. A real party in interest is the one who is vested with the right of action on a given claim, although the beneficial interest may be in another. This standing doctrine recognizes that litigation should be begun only by a party having an interest that will assure sincere and vigorous advocacy. In addition, the doctrine protects a defendant from multiple lawsuits for the same cause of action. A defendant is not harmed provided the final judgment is a full, final, and conclusive adjudication of the rights in controversy that may be pleaded to bar any further suit instituted by any other party. [City of Kalamazoo v Richland Twp, 221 Mich App 531, 534; 562 NW2d 237 (1997) (citations omitted).]
In cases involving corporations, the “doctrine of standing provides that a suit to enforce corporate rights or to redress or prevent injury to a corporation, whether arising from contract or tort, ordinarily must be brought in the name of the corporation, and not that of a stockholder, officer, or employee.” Belle Isle Grill Corp v Detroit, 256 Mich App 463, 474; 666 NW2d 271 (2003).
Here, plaintiffs pleaded fraudulent misrepresentation against Zarb on the basis of Zarb’s failure to inform them that Robot Printing no longer owned the Robocolor Process. As a result of the alleged duplicity, both Anthony Barclae and CYNBA claimed that they loaned money to and infused Robot Printing with operating capital; the allegations indicated a fraud directed at Barclae and CYNBA. The claim is not simply derivative because the alleged wrong was a breach of duty owed personally to these plaintiffs. Although plaintiffs’ claims must fail for the reason previously stated, they had standing to bring this cause of action.
VII. DID THE TRIAL COURT ERR BY DISMISSING ALL OF ROBOT DEFINED’S CLAIMS AGAINST COMERICA?
A. $500,000 DEPOSIT AS LIQUIDATED DAMAGES
Robot Defined argues that the trial court erred by dismissing its claim against Comerica regarding the return of its $500,000 deposit.
The May 4, 2007, debt sale agreement included the following provision:
5. The Purchase Price is payable as follows:
(a) A non-refundable Deposit of $500,000 payable as follows: (i) $250,000 in cash (which Assignor has received); and (ii) a $250,000 promissory note in favor of Assignor, in the form attached, executed by Penske Corporation and delivered to Assignor. The Deposit is non-refundable unless Assignor refuses to close. If Assignee breaches this Agreement, Assignor may retain the Deposit as liquidated damages.
When interpreting a contract, a court’s obligation is to determine the intent of the contracting parties. Woodbury v Res-Care Premier; Inc, 295 Mich App 232, 244; 814 NW2d 308 (2012). If the language of the contract is unambiguous, the court must construe and enforce the contract as written. Id.
“A contractual provision for liquidated damages is nothing more than an agreement by the parties fixing the amount of damages in the case of a breach of that contract.” Papo v Aglo Restaurants of San Jose, Inc, 149 Mich App 285, 294; 386 NW2d 177 (1986).
It is a well-settled rule in this State that the parties to a contract can agree and stipulate in advance as to the amount to be paid in compensation for loss or injury which may result in the event of a breach of the agreement. Such a stipulation is enforceable, particularly where the damages which would result from a breach are uncertain and difficult to ascertain at [the] time [the] contract is executed. If the amount stipulated is reasonable with relation to the possible injury suffered, the courts will sustain such a stipulation. [Moore v St Clair Co, 120 Mich App 335, 340; 328 NW2d 47 (1982) (quotation marks and citation omitted).]
The validity of a liquidated damages clause depends on the conditions existing when the contract was signed rather than at the time of the breach. EF Solomon v Dep’t of State Hwys & Transp, 131 Mich App 479, 484; 345 NW2d 717 (1984).
Here, the parties agreed that, if Robot Defined failed to comply with the agreement, it would essentially forfeit the $500,000 deposit and the bank could retain the deposit as liquidated damages. Robot Defined ar gues that the “election of remedies” doctrine barred the bank from asserting a claim against it for indemnification.
The election of remedies doctrine is a “procedural rule which precludes one to whom there are available two inconsistent remedies from pursuing both.” Riverview Coop, Inc v First Nat’l Bank & Trust Co of Mich, 417 Mich 307, 311; 337 NW2d 225 (1983). The purpose of the doctrine “is not to prevent recourse to alternate remedies, but to prevent double redress for a single injury.” Id. at 312. “In order for the doctrine to apply, three prerequisites must exist: (1) at the time of the election, there must have been two or more remedies available; (2) the alternative remedies must be inconsistent rather than consistent and cumulative; and (3) the party must have chosen and pursued one remedy to the exclusion of the other(s).” Prod Finishing Corp v Shields, 158 Mich App 479, 494; 405 NW2d 171 (1987). A plaintiff may, however, simultaneously pursue all available remedies regardless of their legal consistency, if the plaintiff does not obtain a double recovery. Jim-Bob, Inc v Mehling, 178 Mich App 71, 92; 443 NW2d 451 (1989).
“For one proceeding to be a bar to another for inconsistency, the remedies must proceed from opposite and irreconcilable claims of right and must be so inconsistent that a party could not logically assume to follow one without renouncing the other. Two modes of redress are inconsistent if the assertion of one involves the negation or repudiation of the other. In this sense, inconsistency may arise either because one remedy must allege as fact what the other denies, or because the theory of one must necessarily be repugnant to the other. More particularly, where the election of a remedy assumes the existence of a particular status or relation of the party to the subject matter of litigation, another remedy is inconsistent if, in order to seek it, the party must assume a different and
inconsistent status or relation to the subject matter.” [Prod Finishing Corp, 158 Mich App at 494-495, quoting 25 Am Jur 2d, Election of Remedies, § 11, pp 653-654.]
Robot Defined does not take issue with the liquidated damages provision; it only argues that by retaining the deposit, the bank is foreclosed from seeking further damages. However, as the bank points out, Robot Defined does not have a cause of action in this regard. Robot Defined’s “claim” is really a defense to a breach of contract action. Thus, the liquidated damages provision and the bank’s failure to tender back the deposit serves Robot Defined as an affirmative defense to a breach of contract action by the bank. Given the permissive language in the provision, Robot Defined might well succeed on such a defense. However, because there was no “cause of action,” the trial court did not err by dismissing the count.
B. BREACH OF CONTRACT WITH REGARD TO RECEIVABLES
Robot Defined next argues that the trial court erred by dismissing its breach of contract counterclaim, arguing that the statute of frauds did not apply because the agreement relating to the accounts receivable was in a written instrument.
The written instrument to which Robot Defined refers was not the parties’ May 4, 2007, debt sale agreement; it was the May 4, 2007 forbearance agreement, which provided:
Borrowers [Robot Printing and its guarantors] acknowledge and agree they shall hold in express trust for Bank and immediately surrender to Bank in the form received all of their cash inflows by depositing such inflows into account _ maintained at Bank. Proceeds of Accounts generated on or prior to April 16, 2007 shall be applied to reduce permanently the Liabilities. Provided there is no default under this Agreement and no default under the Debt Sale Agreement (defined below), Bank agrees to deposit promptly to Printing’s operating account maintained at Bank all proceeds of Accounts generated by Printing after April 16, 2007 and Borrowers may use the proceeds of such Accounts for working capital. In the event customers of Printing owe Accounts generated both prior to and after April 16, 2007, collections from those customers shall be applied first to the pre-April 16, 2007 Accounts (and applied by Bank to the Liabilities), unless there is a bona fide and fully documented dispute raised by such customer as to the validity of the pre-April 16, 2007 Account, in which case the payment shall be considered on account of post-April 16, 2007 Accounts. ... At the request of Buyer (defined below) and Borrowers, Bank agrees to subordinate its lien on the post-April 16,2007 Accounts to a new lender, including [CYNBA] International, Inc., an affiliate of Buyer. [Emphasis added.]
As Comerica points out, the foregoing provision has no application because Robot Defined failed to consummate the debt sale agreement. Thus, Comerica was under no obligation to share the receivables with Robot Defined.
C. CONVERSION, FRAUD, AND UNJUST ENRICHMENT
As discussed above, Robot Defined’s claims for conversion, fraud, and unjust enrichment must fail because Robot Defined seeks to enforce an oral agreement and the statute of frauds precludes such claims.
Affirmed.
BORRELLO, P.J., and K. F. KELLY and GLEICHER, JJ., concurred.
This Court ultimately concluded that, because Zarb was not a signatory of the documents as an individual, he could not take advantage of the jury-waiver provisions. Therefore, this Court ordered that plaintiffs’ demand for a jury trial be reinstated. Barclae, unpub op at 4-5.
See also Tri-Mount/Preserves Bldg Co, Inc v TCF Nat’l Bank, unpublished opinion per curiam of the Court of Appeals, issued October 4, 2005 (Docket No. 254077), p 3 (MCL 566.132(2) applied where “[t]he sale of the land was intertwined with the extension of credit”).
The doctrine of partial performance applies primarily in actions involving land. Dumas v Auto Club Ins Ass’n, 437 Mich 521, 540; 473 NW2d 652 (1991). | [
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Saad, J.
Defendants appeal as of right, and plaintiffs cross appeal, from the trial court’s order granting summary disposition to plaintiffs in this residential property dispute. We affirm.
I. FACTS AND PROCEEDINGS
Most of the essential facts in this case are not in dispute. In November 1969, Jarl Corporation, developers of the Tan Lake Shores Subdivision in Oxford Township, recorded a plat for the subdivision. The plat documents contain a dedication of the subdivision streets to the public, a designation of easements, and a specification that “Outlot A is reserved for the use of the lot owners . . . .” According to the parties, Outlot A originally consisted of two lots abutting Tan Lake and located at the end of a cul-de-sac on Brook- field Road. The ownership of one of the Outlot A lots is at the center of this dispute.
At the time the developers filed the plat, they also recorded certain restrictions for the subdivision, including one restriction at issue on appeal:
17. All the restrictions, conditions, covenants, charges, easements, agreements and rights herein contained shall continue for a period of twenty-five years from date of recording this instrument.
Officers of the Jarl Corporation signed the dedication and restrictions, as did other lot owners, including James Fritch, whom the parties do not dispute owned both the disputed part of Outlot A and the adjacent lot, lot 21, when the plat was filed. Thereafter, James Fritch sold lot 21 and the disputed part of Outlot A together, as did prior and subsequent sellers. Plaintiffs purchased the property from Anthony and Lori Pasko in October 1996 and their deed reflects their ownership of both lot 21 and “part of Outlot A,” the size and location of which is also set forth in their deed.
Plaintiffs filed this action on July 22, 1998, as the current owners of lot 21 and part of Outlot A, seeking to have the “Outlot A is reserved for the use of the lot owners” specification removed, or declared null and void, for that portion of Outlot A that they own. According to plaintiffs, they learned about the language in the plat when they applied for a permit to build a home on lot 21 and their portion of Outlot A. The thirty-seven defendants in this case are other lot owners in the subdivision, only six of whom have appealed. Defendants claim that the reservation of Outlot A constitutes a valid dedication of the lot for the use of other lot owners in the subdivision as a place from which to launch boats and swim.
On February 4, 1999, plaintiffs filed a motion for summary disposition under MCR 2.116(C)(10). Relying on ¶ 17 of the restrictions for the subdivision plat, plaintiffs argued that the restriction on the use of Outlot A expired because twenty-five years had elapsed since the 1969 platting of the subdivision. Thereafter, plaintiffs filed another motion and argued that the doctrines of laches and estoppel bar defendants’ claims to the use or ownership of plaintiffs’ portion of Outlot A. Plaintiffs further asserted that they lawfully own the property because the plat does not contain a valid public dedication.
Several defendants responded to the summary disposition motions and argued that the twenty-five-year limitation did not apply to the 1969 dedication of Out-lot A. The defendants who ultimately appealed the trial court’s ruling filed a separate motion for summary disposition on March 23, 1999, arguing that Out- lot A was validly dedicated to the lot owners in the subdivision plat, that the restrictions did not apply to Outlot A because it was dedicated before the restrictions were filed, and that plaintiffs could not establish ownership of part of Outlot A through adverse possession.
On September 24, 1999, the trial court entered an order granting summary disposition to plaintiffs on the basis of laches and estoppel. On October 11, 1999, the court entered another order describing plaintiffs’ exclusive right to the disputed portion of Outlot A.
H. ANALYSIS
We review a trial court’s decision on a motion for summary disposition de novo. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998).
The central issue in this case involves the legal ownership of the one-third portion of Outlot A. Plaintiffs assert that they own the parcel through a valid deed and that defendants claim ownership by statutory dedication under MCL 560.253 of the Land Division Act, previously known as the Subdivision Control Act, MCL 560.101 et seq. Though the trial court did not expressly decide that issue, the parties raised it below and we must address it for a proper resolution of this appeal. Peterman v Dep’t of Natural Resources, 446 Mich 177, 183; 521 NW2d 499 (1994).
We conclude that the trial court properly granted summary disposition to plaintiffs; however, we affirm for reasons other than those articulated by the trial court. Rather than rest our decision on equitable principles alone, we find that plaintiffs own the disputed portion of Outlot A as a matter of law and that the plat documents do not convey title of the disputed property by statutory dedication to defendants or other owners of lots within the subdivision.
Plaintiffs established evidentiary support for then-claim of title to the disputed portion of Outlot A by showing the chain of title that began before the recording of the plat dedication in 1969. To counter that evidence, defendants relied on subsections 253(1) and (2) of the Land Division Act, previously known as the Subdivision Control Act, MCL 560.101 et seq.:
(1) When a plat is certified, signed, acknowledged and recorded as prescribed in this act, every dedication, gift or grant to the public or any person, society or corporation marked or noted as such on the plat shall be deemed sufficient conveyance to vest the fee simple of all parcels of land so marked and noted, and shall be considered a general warranty against the donors, their heirs and assigns to the donees for their use for the purposes therein expressed and no other.
(2) The land intended for the streets, alleys, commons, parks or other public uses as designated on the plat shall be held by the municipality in which the plat is situated in trust to and for such uses and purposes. [MCL 560.253 (emphasis added).]
Defendants suggest that we construe subsection 253(1) to permit a “dedication” to private individuals. However, a thorough review of the case law convinces us that, before and after the platting and subdivision statutes were enacted, “dedication” clearly referred to an appropriation of land for public use. Attorney General ex rel Dep’t of Natural Resources v Cheboygan Co Bd of Co Rd Comm’rs, 217 Mich App 83, 88; 550 NW2d 821 (1996); see also Patrick v Young Men’s Christian Ass’n of Kalamazoo, 120 Mich 185, 191; 79 NW 208 (1899).
First, our case law clearly states that, to accomplish a dedication, the property owner’s intent to dedicate the land to the public must be unequivocal. Kraus v Dep’t of Commerce, 451 Mich 420, 424; 547 NW2d 870 (1996). To that end, “a valid dedication of land for a public purpose requires two elements: a recorded plat designating the areas for public use, evidencing a clear intent by the plat proprietor to dedicate those areas to public use, and acceptance by the proper public authority.” Id. Acceptance by the public authority must be timely, and it “must be disclosed through a manifest act by the public authority ‘either formally confirming or accepting the dedication, and ordering the opening of such street, or by exercising authority over it, in some of the ordinary ways of improvement or regulation.’ ” Id., quoting Tillman v People, 12 Mich 401, 405 (1864).
Defendants have not presented evidence of either element to support their statutory dedication claim. The statement, “Outlet A is reserved for the use of the lot owners” does not show a clear intent by the property owner to dedicate the lot to the “public.” The declaration specifies that the property is for the use of lot owners. Thus, were we to read the term “reserved” in the plat as a “dedication,” no evidence shows that the grantors intended Outlot A to be used by the general public rather than a specified class of persons. Further, the plat contains other language specifically stating “that the streets as shown on said plat are hereby dedicated to the use of the public . . . This language clearly shows that, had the developer intended to establish a valid dedication of Outlot A for public use, it could have easily done so. Finally, any intent to dedicate the disputed portion of Outlot A to the public or to other lot owners was negated by the original owner’s subsequent, inconsistent act of privately selling the disputed property.
Moreover, defendants have not presented any evidence of acceptance of the “dedication” by Oxford Township. Defendants have not shown a formal resolution accepting Outlot A, nor have they shown that the township controlled, improved, or used public funds to maintain the lot. See Marx v Dep’t of Commerce, 220 Mich App 66, 77; 558 NW2d 460 (1996). To the contrary, evidence presented clearly indicates that the township continued to assess taxes on all of Out-lot A as private property; the Department of Natural Resources acquired title to the undisputed two-thirds portion of the outlot for the nonpayment of taxes while private owners in the chain of title to the disputed property, including plaintiffs, paid property taxes on the portion they owned. Further, defendants have failed to show that members of the public made any use of the lot that would remotely evidence the township’s or the public’s acceptance of the property.
Apparently acknowledging that no “public dedication” occurred, defendants contend that the statute also applies to “private dedications,” which, they argue, occurred here as a result of the plat language and because owners of other lots in the subdivision showed their acceptance of the dedication by using the property.
Before the Plat Act, 1929 PA 172, was revised by the Subdivision Control Act, the applicable statute addressed public entities only. See 1954 PA 186, MCL 560.12 (repealed). Our courts held “dedication” to mean an appropriation of land for public use, and statutory dedication was not extended to encompass uses outside the general public. See Patrick, supra at 191-192. Though the Legislature expanded the scope of permitted conveyances in the 1967 revisions, we construe the term “dedication” in accordance with its meaning set forth in our well-established case law.
Our Supreme Court specifically stated in Kraushaar v Bunny Run Realty Co, 298 Mich 233, 241-242; 298 NW 514 (1941):
Solely as individuals these plaintiffs cannot assert any rights based upon the dedication and acceptance of the plat; but, instead, rights of that character must be asserted, if at all, as a right or use to which the public in general is entitled.
“There is no such thing as a dedication between the owner and individuals. The public must be a party to every dedication. In fact, the essence of a dedication to public uses is that it shall be for the use of the public at large.
There may be a dedication of lands for special uses, but it must be for the benefit of the public, and not for any particular part of it; and if from the nature of the user it must be confined to a few individuals, . . . the idea of dedication is negatived.” [Id., quoting 16 Am Jur 359.]
Our courts have likewise held that “there cannot be a dedication for private purposes or enjoyment . . . West Michigan Park Ass’n v Dep’t of Conservation, 2 Mich App 254, 267; 139 NW2d 758 (1966); see also Detroit Edison Co v Detroit, 332 Mich 348, 353; 51 NW2d 245 (1952), and Patrick, supra at 191-192. Similarly, citing decisions from numerous other jurisdictions, 23 Am Jur 2d, Dedication, § 5, pp 7-8 (1983), states:
The essence of dedication is that it shall be for the use of the public at large, that is, the general, unorganized public, and not for one person or a limited number of persons, or for the exclusive use of restricted groups of individuals. There may be a dedication for special uses, but it must be for the benefit of the public. Properly speaking, there can be no dedication to private uses or for a purpose bearing an interest or profit in the land. [Citations omitted; emphasis added.]
Our research has uncovered cases that use the term “dedication” loosely to describe grants, gifts, or easements of property to homeowners’ associations or to specific persons or categories of persons. However, we note that those cases do not address dedications under the Subdivision Control Act or the Land Division Act. Unfortunately, the undisciplined use of the term dedication has led to some confusing and conflicting statements of the law. Specifically, in Feldman v Monroe Twp Bd, 51 Mich App 752, 754-755; 216 NW2d 628 (1974), this Court appeared to, without analysis, equate a private dedication with a statutory, public dedication. We reject this conclusion in Feldman because it is simply not supported by the cases cited, which refer only to private rights stemming from an intent to dedicate land to the public or for public purposes. See Westveer v Ainsworth, 279 Mich 580; 273 NW 275 (1937), and Kirchen v Remenga, 291 Mich 94; 288 NW 344 (1939).
We recognize that, were we to find that the plat proprietors intended to dedicate Outlot A to the public, “private rights to the use of [the] property arise and are in addition to the rights of the public acquired upon acceptance of the dedication.” In re Engelhardt, 368 Mich 399, 402; 118 NW2d 242 (1962). Indeed, it remains the general rule that if a plat sets forth a public dedication that is not properly accepted by the township, property owners within the plat maintain a private right of use. Nelson v Roscommon Co Rd Comm, 117 Mich App 125, 132; 323 NW2d 621 (1982). Similarly, those who buy property relying on a public dedication in a plat may object to a petition to vacate the dedication on the basis of their private rights and as members of the public. Engelhardt, supra at 404; see also Pulcifer v Bishop, 246 Mich 579, 582; 225 NW 3 (1929). However, these private rights of the lot owners are rights of use “ ‘in the nature of private rights founded upon a grant or covenant’ ” as discussed above. Id. at 583, quoting Dillon on Municipal Corporations (5th ed), § 1090; see also Schurtz v Wescott, 286 Mich 691, 696-697; 282 NW 870 (1938). Pulcifer, the case on which defendants pri marily rely, specifically recognizes the distinction between rights acquired by the public through dedication and private rights founded on a grant or covenant. Defendants do not argue that Fritch or the developers intended a gift or grant of Outlot A to the other lot owners in the subdivision, though such a conveyance clearly falls within the ambit of the statute. Knauff v Oscoda Co Drain Comm’r, 240 Mich App 485, 489-490; 618 NW2d 1 (2000). Any such claim would fail in this case, however, because the document does not show the requisite donative intent. See Beulah Hoagland Appleton Qualified Personal Residence Trust v Emmet Co Rd Comm, 236 Mich App 546, 554; 600 NW2d 698 (1999) (statutory dedication requires that the recorded plat evidence a clear intent by the plat proprietor to dedicate the designated area to public use); cf. Ryan v Wilson, 9 Mich 262 (1861) (a grantor’s intent should clearly appear on the face of the document of conveyance), and Davidson v Bugbee, 227 Mich App 264, 268; 575 NW2d 574 (1997) (valid gift requires that the donor intend to transfer title gratuitously to the donee).
Further, had it been his intent, James Fritch could have transferred fee simple title to the disputed portion of Outlot A to all the lot owners or to a homeowner’s association, but he did not do so. See Musser v Loon Lake Shores Ass’n, Inc, 384 Mich 616, 618, 622; 186 NW2d 563 (1971).
The fact that the defendant lot owners were beneficiaries of the restrictive use of Outlot A did not create a proprietary interest in Outlot A. Rather, the language at issue indicates an intent to create a private, contractual right of use or an implied or restrictive covenant, reserving the use of Outlot A to subdivision lot owners. See Dorfman v State Hwy Dep’t, 66 Mich App 1; 238 NW2d 395 (1975). For this reason, we hold that ¶ 17 of the restrictions document applies to the “reservation” of Outlot A, an issue not specifically addressed in the trial court’s written opinion and order.
The restrictions document expressly refers to the plat documents at Liber 129, pages 29 and 30, the documents were executed and recorded at the same time and they relate to the same transaction. Further, copies of deeds for lots sold in the subdivision that were submitted by the parties not only refer to the plat, but specifically state that the deed is subject to recorded restrictions. Accordingly, we construe the documents together as one instrument for purposes of determining the rights of the lot owners. West Madison Investment Co v Fileccia, 58 Mich App 100, 106; 226 NW2d 857 (1975). Reading the documents together, we find that ¶ 17 clearly and unambiguously provides for a twenty-five-year duration for “[a]ll the restrictions, conditions, covenants, charges, easements, agreements and rights herein contained . . . .” Thus, as matter of law, the “reserved for the use of the lot owners” restriction expired in November 1994 and defendants, as lot owners, may not enforce it. See Sampson v Kaufman, 345 Mich 48, 52-53; 75 NW2d 64 (1956).
Because we conclude that plaintiffs prevail as a matter of law, a resort to equitable principles is not necessary. However, fairness compels us to observe that, for nearly thirty years, defendants never challenged the numerous private sales of the disputed portion of Outlot A or asserted their purported rights when prior owners posted “No Trespassing” signs, and defendants failed to come forward with evidence that other lot owners actually used the disputed portion of the property. We also conclude that, on the basis of the continuous and unchallenged chain of title to the disputed portion of the outlot and the lack of evidence showing that the disputed portion was used in the manner for which it was intended, the reservation or restrictive covenant rendered little value to defendants and its intended purpose has failed. See Cooper v Kovan, 349 Mich 520, 531; 84 NW2d 859 (1957) (if the purpose for which a restriction was imposed can no longer be accomplished, equity may decline to enforce it); see also Gomah v Hally, 366 Mich 31, 34; 113 NW2d 896 (1962).
We also observe that defendants’ claim of fee ownership of the disputed portion of Outlot A is logically incompatible with their actions regarding the remainder of the lot. Defendants individually failed to maintain the lot and failed to pay taxes on it, no homeowner’s association was formed to collect money for upkeep or taxes, and such inaction led to the acquisition of title by the state. Indeed, we must logically conclude that, absent the private deed holders (including plaintiffs) who paid taxes on the property, the state would also have acquired title to the disputed portion of Outlot A. Thus, it is utterly disingenuous for defendants to now claim fee ownership of the disputed portion, thereby taking advantage of the deed holders’ diligent payment of taxes, where defendants failed to show any exercise of the responsibilities of property ownership in the past. For this reason, we also believe our decision is consistent with principles requiring a manifest act of acceptance of “dedicated” property “to prevent land from becom ing waste property, owned or developed by no one,” precisely what happened to the remainder of the out-lot in this case. Kraus, supra at 424.
The trial court reached the correct result in this case and properly granted summary disposition to plaintiffs.
Affirmed.
According to the parties, all properties in the subdivision have access to Tan Lake, either directly or through a canal. subsequent deeds. Harmon and Dla Fritch purchased lot 21 and “Parcel Two” in 1966 and sold it to James and Dianne Fritch in 1968.
The Paskos bought lot 21 and part of Outlot A by warranty deed from Gerald and Amelia Kelly on September 1, 1987. The Paskos’ deed contains the same property description set forth in plaintiffs’ deed and both Anthony and Lori Pasko testified in an affidavit that they maintained the disputed property, paid taxes and liability insurance for it, and posted “no trespassing” signs on it during their ownership.
The same description of lot 21 and part of Outlot A appears on prior warranty deeds executed in October 1983 from Donald and Sandra Brouhard to the Kellys, and from Harmon and Hla Fritch to the Brouhards. Harmon and Ilia Fritch were the first purchasers of the property after it was platted. They acquired their quitclaim deed from James Fritch (the owner at the time of the platting) and his wife, Dianne Fritch, on January 8, 1976. The deed did not refer to Outlot A, but contained a description of “Parcel Two,” with essentially the same description of Outlot A as in the
In a later reply brief, plaintiffs denied that they are asserting a claim of adverse possession and, therefore, we will not address this issue.
A motion under MCR 2.116(C)(10) tests the factual support for a claim. Spiek, supra at 337. If the proffered evidence does not establish a genuine issue of material fact, the moving party is entitled to judgment as a matter of law. Maiden v Rozwood, 461 Mich 109, 120; 597 NW2d 817 (1999).
Plaintiffs did not file this action specifically seeking to quiet title to the disputed portion of Outlot A, as provided by MCR 3.411 and MCL 600.2932, but only to remove restrictions or reservations from their claimed property. However, plaintiffs raised title questions in their complaint and the case evolved into one that, substantively, would determine property rights akin to an action to quiet title for all named defendants. In an action to quiet title, the plaintiff must make out a prima facie case of title. Beulah Hoagland Appleton Qualified Personal Residence Trust v Emmet Co Rd Comm, 236 Mich App 546, 550; 600 NW2d 698 (1999). The property interest may be legal or equitable. Id. The defendants then have the burden of proving superior right or title. Id. Because it is an equitable action, a court “looks at the whole situation and grants or withholds relief as good conscience dictates.” Republic Bank v Modular One LLC, 232 Mich App 444, 451; 591 NW2d 335 (1998) (citations and internal quotations omitted). This Court reviews equitable issues de novo. Hoagland, supra at 550; Cipri v Bellingham Frozen Foods, Inc, 235 Mich App 1, 9; 596 NW2d 620 (1999).
In fact, defendants limit their claims on appeal to the validity of the dedication and the applicability of the recorded subdivision restrictions. Defendants’ claim that the trial court erred in granting summary disposition on the basis of the doctrines of laches and estoppel is not properly before this Court because defendants failed to raise it in their statement of questions presented. Meagher v McNeely & Lincoln, Inc, 212 Mich App 154, 156; 536 NW2d 851 (1995); MCR 7.212(C)(5).
This Court will not disturb a trial court’s ruling to grant summary disposition that reaches the correct result for a different reason. Howe v Detroit Free Press, Inc, 219 Mich App 150, 158; 555 NW2d 738 (1996).
In Patrick, our Supreme Court addressed the validity of a “private dedication” and opined:
[B]y the language of the act this provision applies only to “public ground.” Public ground, in the ordinary sense, is ground in which the general public has a common use; and it would not accord with the common understanding of the language used to say that land devoted to the use of a local religious society, or hospital, or academy, created for church, hospital, or academic purposes, is public ground, even if the use be considered, in a sense, public; and, in the absence of a clear intention to include such, the statute ought not to be so construed. Again, the statute itself contains internal evidences that dedications for such purposes were not designed to be within its meaning, for it illustrates the class of public uses to which it alludes, viz., “streets, alleys, commons, or other public uses,” and thus, under the settled rule of ejusdem generis, its effect was restricted to public uses of a similar nature. See End Interp Stat 405 et seq. [Patrick, supra at 191-192.]
Defendants submitted the affidavit of Samuel Brandt in which he states that, since 1988, lot owners used “the outlot” for swimming and launching boats. However, evidence indicates that Brandt testified dining his deposition that he never saw anyone launch boats from the disputed portion of Outlot A. Defendants present no further evidence that lot owners use the outlot and no evidence that lot owners use the disputed portion of the outlot, consisting of only one-third of the total lot. Thus, though we do not decide this case on this basis, defendants’ claim that other lot owners “accepted” the “private dedication” of the disputed property through use, is not supported by the record.
1967 PA 288.
MCL 560.253(1).
Further, while a grantee of property in a platted subdivision acquires a private right entitling him “to the use of the streets and ways laid down on the plat, regardless of whether there was a sufficient dedication and acceptance to create public rights,” this does not extend to the interminable use of a lot improperly described as a statutory public dedication. Rindone v Corey Community Church, 335 Mich 311, 317; 55 NW2d 844 (1952) (internal quotations omitted). | [
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Wilder, P.J.
The prosecution appeals by leave granted a circuit court order that affirmed a district court order suppressing the results of breath alcohol tests performed after defendant was arrested. We reverse the circuit court’s order and remand for further proceedings consistent with this opinion.
I. FACTS AND PROCEDURAL BACKGROUND
On October 15, 1999, defendant was arrested and charged with operating a vehicle while under the influence of liquor (ouil), MCL 257.625(1)(a), and having an unlawful blood alcohol level (ubal), MCL 257.625(l)(b). Defendant agreed to submit to an evidentiary breath test at the police station. Pursuant to administrative rale 1994 AACS, R 325.2655(l)(e), the arresting deputy began a fifteen-minute observation period of defendant. Following this observation period, defendant provided a breath sample, which indicated that her blood alcohol content was above the legal limit of 0.10 grams for each 210 liters. Defendant then submitted to the officer’s request for a second test. The second test did not provide a numerical reading, it instead returned the message “invalid sample.” No additional test was requested or administered by the deputy.
Defendant moved in the district court to suppress the first test result, arguing that it was inadmissible because the second test was unable to confirm its results as required by 1994 AACS, R 325.2655(l)(f) and because it was tainted by the presence of mouth alcohol. She further argued that the test was inadmissible because the deputy violated 1994 AACS, R 325.2655(l)(b) when he failed to comply with mandatory procedures in the Michigan Breath Operator Training Manual (operation manual) by not administering a third test. In contrast, the prosecution alleged that the training manual does not mandate a third breath test and that Rule 325.2566(l)(f) requires only one sample for evidentiary purposes. Following a motion hearing, the district court granted defendant’s motion to suppress. The circuit court, without oral argument, denied the prosecution’s application for leave and affirmed the district court’s suppression of the test results. This Court then granted the prosecution’s application for leave to appeal.
H. ANALYSIS
The prosecution first argues that the circuit court committed clear legal error by violating MCR 7.103(B)(4) when it denied the prosecution’s application for leave to appeal without oral argument. We disagree. The construction of court rules is a question of law that this Court reviews de novo for error, and if the language is clear, then this Court should apply it as written. People v Valeck, 223 Mich App 48, 50; 566 NW2d 26 (1997); Bruwer v Oaks (On Remand), 218 Mich App 392, 397; 554 NW2d 345 (1996).
MCR 7.103(B)(4) states:
The application must be noticed for hearing in the circuit court at least 14 days after its filing. The circuit court may shorten the notice period on a showing of need for immediate consideration.
Although the prosecution correctly notes that the word “must” is mandatory language, nothing in the rule states that the circuit court must hold a hearing. The rule simply states that the court must give “notice” of a hearing regarding the application to be held at least fourteen days after the filing of the application. Accordingly, because nothing in the clear language of MCR 7.103(B)(4) provides for a mandatory hearing at which the parties may offer oral argument with respect to applications for leave to appeal, we hold that the circuit court did not err in denying the prosecution oral argument. To this end, we find the following commentary to be particularly persuasive:
If one compares the provisions of MCE 7.103(B) with those of MCR 7.205(D)(1), it is immediately noted that MCR 7.103(B) is silent on the question of whether or not a party is entitled to oral argument on his or her application for leave to appeal. While practice within the individual circuits may vary, an application for leave to appeal is generally heard on the court’s motion docket, and within the constraints of that docket, a party is generally permitted to “argue” his or her case. [Michigan Court Rules Practice, Rule 7.103, Authors’ Comment, p 76 (emphasis added).]
The prosecution further argues that the circuit court erred in determining that the district court properly suppressed defendant’s first breath alcohol test because the reading was not confirmed by an additional test. We agree. This Court reviews for clear error findings of fact regarding a motion to suppress evidence. However, we review de novo the trial court’s ultimate decision on a motion to suppress. People v Williams, 240 Mich App 316, 319; 614 NW2d 647 (2000). The admission of chemical test results in a prosecution for ouh/ubal is authorized by MCL 257.625a(6). To be admissible, the test results must be both relevant and reliable. People v Wager, 460 Mich 118, 126; 594 NW2d 487 (1999); People v Campbell, 236 Mich App 490, 504; 601 NW2d 114 (1999); People v Wujkowski, 230 Mich App 181, 186-187; 583 NW2d 257 (1998). Further, suppression of test results is required only when there is a deviation from the administrative rules that call into question the accuracy of the test. Id.
Here, there is no issue regarding the relevancy of the test; instead, we are faced with the reliability of the test. Both the district court and the circuit court ruled that the first test must be suppressed under Rule 325.2655(l)(b) because the deputy failed to conduct the test under the procedures approved by the department and because the reading from the first test of 0.18 percent was never confirmed by a second or third test as required by Rule 325.2655(l)(f). We conclude that these rulings were erroneous and that Rule 325.2655(l)(f) does not require suppression of the first test under the circumstances presented here. Rule 325.2655(l)(f) reads in part:
A second breath alcohol analysis shall be requested from the person being tested and administered, unless ... a substance is found in the person’s mouth subsequent to the first test that could interfere with the test result. Obtaining the first sample is sufficient to meet the requirements for evidentiary purposes prescribed in [MCL 257.625c. ] The purpose of obtaining a second sample result is to confirm the result of the first sample. A second sample result shall not vary from the first sample result by more than the following values:
[Table omitted.]
If the variation is more than that allowed, a third breath sample shall be requested from the person being tested and a third result may be obtained.
The rules of statutory construction apply to the interpretation of administrative rules. Wujkowski, supra at 185. Thus, meaning should be given to every word of a rule, and no word should be treated as surplusage or rendered nugatory if at all possible. See Hoste v Shanty Creek Management, Inc, 459 Mich 561, 574; 592 NW2d 360 (1999); Camden v Kaufman, 240 Mich App 389, 395; 613 NW2d 335 (2000). In addition, if the language of the rule is clear and unambiguous, additional judicial construction is neither necessary nor permitted, and the language must be applied as written. Camden, supra at 394; Aheam v Bloomfield Charter Twp, 235 Mich App 486, 498; 597 NW2d 858 (1999).
Rule 325.2655(l)(f) clearly states that a second test shall be requested and administered unless refused or unless “a substance is found in the person’s mouth subsequent to the first test that could interfere with the test result.” Here, the second test was aborted because the machine detected the presence of mouth alcohol, a substance that would interfere with the result. The machine therefore stated that the test involved an “invalid sample.” Defendant’s argument that the presence of mouth alcohol during the second test mandates a conclusion that the first test is invalid because the alcohol must have been present during that test is without merit, because defendant offers no explanation or evidence as to why the machine would not have invalidated that test as well.
Under the clear language of the rule, a third test was not required under the circumstances of this case. A third test is required only when the variance between the first and second test is larger than the amount provided for in the table. See Rule 325.2655(l)(f). In this case, that would have been a variation of 0.02 percent. Id. The variance table was promulgated to ensure the accuracy of the machine. A reading of “invalid sample” does nothing to undermine the machine’s accuracy. Rule 325.2655(l)(f) further states that the first sample is sufficient to meet the evidentiary requirements of MCL 257.625c. The rule did not require the deputy to wait an additional fifteen minutes and then administer a third test. The fact that a confirming test result was not obtained is relevant solely to the weight of the evidence. Wager, supra at 125-126; Campbell, supra at 504. Accordingly, the deputy complied with Rule 325.2655(l)(f), and suppression under this subsection of the results of the first test was improper.
Next, we address whether suppression was warranted under Rule 325.2655(l)(b). Again, we hold that suppression was not required. Rule 325.2655(l)(b) states:
A procedure that is used in conjunction with evidential breath alcohol analysis shall be approved by the department and shall be in compliance with all of the following provisions:
(b) All analyses shall be conducted using the department-approved procedures and report forms as required.
Defendant contends that the deputy violated this subsection by failing to follow certain instructions in the operation manual. Specifically, defendant contends that the manual required the deputy to administer a third test after the second test read “invalid sample.” The language in question reads:
Mouth alcohol implies the presence of alcohol in the mouth. If this is indicated, it may result from stomach contents, containing alcohol, regurgitated from the stomach up into the mouth. If, while the subject is blowing into the DataMaster, mouth alcohol is detected, the test will be aborted.
Both the display and the print-out will indicate “invalid sample.” [Michigan Breath Test Operator Training Manual, ch 8, p 8-9.]
Defendant argues that the above language indicates that mouth alcohol was not intended to be considered a “substance . . . found in the person’s mouth subsequent to the first test that could interfere with the test result.” Rule 325.6255(l)(f). We disagree. The operation manual clearly indicates that the presence of mouth alcohol will render a test invalid. Obviously, mouth alcohol is “a substance . . . found in the person’s mouth . . . that could interfere with the test result,” id., and we are not persuaded by defendant’s argument that mouth alcohol was not intended to be considered such a substance.
Defendant further contends that the deputy violated the operation manual because he was required to perform an additional test after receiving an “invalid sample” reading. Again, we disagree. In the sections dealing with the procedure to be followed when a machine returns an “invalid sample” reading, the manual states:
The operator should start a new 15 minute observation period and go through the test procedure again. A blood test shall be requested if “invalid sample” is detected again. If the subject refuses, seek a warrant. Failure of the subject to provide this test cannot be regarded as a refusal as the subject did provide a sample, even though “invalid sample” was indicated, pursuant to implied consent. [Michigan Breath Test Operator Training Manual, ch 8, p 8-9 (emphasis added).]
We note that the word “should” is not defined in either Rule 325.6255(1) or the operational manual. In addition, a review of Michigan published cases indicates that “should” has not been judicially interpreted by our courts. Therefore, we must accord the word its plain and ordinary meaning. Kent Co Aeronautics Bd v Dep’t of State Police, 239 Mich App 563, 578; 609 NW2d 593 (2000); Detroit Edison Co v Spartan Express, Inc, 225 Mich App 629, 633; 572 NW2d 39 (1997). Undefined words are given meaning as under stood in common language, taking into consideration the text and subject matter relative to which they are employed. Stabley v Huron-Clinton Metropolitan Park Authority, 228 Mich App 363, 367; 579 NW2d 374 (1998); see also McAuley v General Motors Corp, 457 Mich 513, 518; 578 NW2d 282 (1998).
While the word “should” can, in certain contexts, connote an obligatory effect as advocated by defendant, the drafters of the manual use both the words “should” and “shall.” Thus, we are not persuaded that it has an obligatory effect here. See State v Garrett, 80 Wash App 651; 910 P2d 552 (1996). In Garrett, the court was faced with construing the meaning of the terms “should” and “shall” as used in subsections 1(b), 2(a), 2(b), and 3(b) of Washington Administrative Code 448-14-020. Subsection 3(b) stated: “Blood samples for alcohol analysis shall be preserved with an anticoagulant and an enzyme poison sufficient in amount to prevent clotting and stabilize the alcohol content.” However, subsection 2(a) stated that “results should be expressed as grams of alcohol per 100 milliliters” and subsection 2(b) stated that “analysis results should be reported to two significant figures” (emphasis added). In holding that anticoagulant must be added to the blood, the court stated:
A provision containing both “should” and “shah” presumes lawmakers intended to distinguish between the terms. “Should” is permissible and expresses a desire or request. “Shall” is clearly unambiguous and presumptively creates an imperative obligation. [Garrett, supra at 653 (citations omitted).]
Similarly, here the drafters of the manual used both “should” and “shall.” Therefore, it is presumed that they intended to distinguish between the terms. Id. Further, because Rule 325.2655(l)(f) states that “[ojbtaining the first sample is sufficient . . . for evidentiary purposes,” imputing a mandatory obligation to the word “should” in this context would cause the plain language of Rule 325.2655(l)(f) to be rendered nugatory. See Hoste, supra at 574; Camden, supra at 395. See also Rafferty v Markovitz, 461 Mich 265, 270; 602 NW2d 367 (1999); McAuley, supra; People v Sheets, 223 Mich App 651, 660; 567 NW2d 478 (1997). Accordingly, we hold that the deputy complied with all mandatory administrative procedures under Rule 325.2655(1) and the results of defendant’s breath analysis were improperly suppressed in this case.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
Rule 325.2655(1)(e) provides in pertinent part:
A person may be administered a breath alcohol analysis on an evidential breath alcohol test instrument only after being observed for 15 minutes by the operator before collection of the breath sample, during which period the person shall not have smoked, regurgitated, or placed anything in his or her mouth, except for the mouthpiece associated with the performance of the test.
The prosecution asserts that the first test revealed a blood alcohol content of 0.18 percent. Defendant has not challenged this reading, however she has challenged the reliability and accuracy.
Relying primarily on People v Willis, 180 Mich App 31; 446 NW2d 562 (1989), the circuit court ruled:
In the instant case the operator neither waited the required 15 minutes between the tests nor offered a confirming test when a second test read “invalid,” even though required by Administrative Rules promulgated by the Michigan State Police.
People v Fosnaugh, unpublished order of the Court of Appeals, entered March 30, 2000 (Docket No. 225555).
MCL 257.625c, states in part: “A person who operates a vehicle upon a public highway. . . is considered to have given consent to chemical tests of his or her blood, breath, or urine.”
The operator’s manual states that if the machine detects mouth alcohol (or other chemical interference) that the test will be aborted and “[b]oth the display and the print-out will indicate “invalid sample.’ ” Michigan Breath Test Operator Training Manual, ch 8, p 8-9.
We also agree with both parties that the circuit court misconstrued the district court’s opinion and improperly held that the deputy was required to wait fifteen minutes between the two breath tests administered to defendant. The district court stated that the deputy should have started a new fifteen minute observation period and administered a new test after receiving an “invalid sample” message. At no point did the district court rule that the deputy was required to wait fifteen minutes between the first and second test. Further, nothing in Rule 325.2655(1) or the operation manual suggests that such an observation period is required between tests. | [
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] |
Markey, J.
Plaintiff Liberty Mutual Insurance Company appeals by right the trial court’s order granting defendant Michigan Catastrophic Claims Association’s (mcca) motion for summary disposition under MCR 2.116(C)(10). The issue before this Court is whether the mcca is required to accept plaintiffs postloss premium payment and reimburse plaintiff for a loss sustained under personal protection insurance coverage in excess of $250,000 pursuant to MCL 500.3104(2) of the no-fault act. We conclude that the MCCA is not required to reimburse plaintiff, and affirm the trial court’s order granting summary disposition in favor of the mcca.
I. FACTS
The parties do not dispute the facts in this case. In March 1992, plaintiff issued a California automobile insurance policy to California residents Larry and Elaine DeGrave to insure their two vehicles registered in California, including a 1980 Datsun. In July 1992, the DeGraves drove from California to Michigan. They arrived in Michigan on July 17 and stayed for more than thirty days without registering their vehicle in Michigan or acquiring Michigan no-fault insurance, contrary to MCL 500.3102(1), which requires nonresidents operating automobiles in Michigan for longer than thirty days to maintain security for the payment of Michigan no-fault benefits. On September 14, 1992, the DeGraves son, Eric, was driving the Datsun when he hit Michael Lanaville, an uninsured motorcyclist, rendering Lanaville a paraplegic. Since the accident, plaintiff has paid Lanaville’s personal protection insurance (pip) benefits, which have exceeded $250,000.
In September 1996, plaintiff sued the DeGraves to reform their California policy into a Michigan no-fault policy that provided security for payment of benefits as required by MCL 500.3101(1), retroactively effective to August 1992 (shortly after the DeGraves’ thirty days of coverage in Michigan under their California policy ended and before the accident). A consent judgment was entered on August 1, 1997, in which plaintiff and the DeGraves agreed that plaintiff would reissue their California policy as a Michigan no-fault policy providing six months of coverage from August 1992 until March 1993, the expiration date of the original California policy. In November 1997, more than five years after the accident in this case, plaintiff tendered a premium payment as required by MCL 500.3104 to the MCCA to cover the DeGraves’ two automobiles under their newly reformed insurance policy. Plaintiff then asked the MCCA for reimbursement of pip benefits exceeding $250,000 owed to Lanaville under the policy. The MCCA rejected the proffered premium payment, stating that the reformed policy did not obligate the MCCA to indemnify plaintiff under MCL 500.3104. The MCCA stated that any pip benefits that plaintiff paid under the policy were paid pursuant to MCL 500.3163, which obligated plaintiff to pay pip benefits under policies issued outside Michigan under circumstances such as those involved in this case.
Plaintiff subsequently commenced this lawsuit seeking a declaration that the MCCA was obligated under MCL 500.3104 to reimburse plaintiff for payment of pip benefits in excess of $250,000 to Lanaville. The MCCA counterclaimed, seeking a declaration that plaintiff is not entitled to reimbursement under MCL 500.3104. On May 5, 1999, the trial court granted the MCCA’s motion for summary disposition after concluding that the mcca did not have to indemnify plaintiff under the instant circumstances. Relying on In re Certified Question (Preferred Risk Mut Ins Co v Michigan Catastrophic Claims Ass’n), 433 Mich 710; 449 NW2d 660 (1989), and Travelers Ins Co v Michigan Catastrophic Claims Ass’n, unpublished opinion per curiam of the Court of Appeals, issued June 13, 1995 (Docket No. 156716), the trial court concluded that the mcca is not required to reimburse under policies issued to nonresidents that are not in compliance with Michigan law. The court concluded that the DeGraves were California residents and that the insurance policy in effect at the time of the accident was a California policy. The court opined that notwithstanding the reformation of the policy, to rule in favor of plaintiff would be a signal to other members who pay mcca premiums that if the situation arose where payment was based on an out-of-state policy, the member could merely reform the policy and predate the dates of coverage so the policy could then comply with MCL 500.3102(1). The court concluded that to so allow would undermine the purpose and intent of the statute. Plaintiff now appeals by right.
n. ANALYSIS
Plaintiff asserts that the trial court erred in granting summary disposition to the mcca because the reformation of the DeGraves’ California insurance policy into a Michigan policy complying with Michigan no-fault law required the MCCA to reimburse plaintiff for payments made that exceeded $250,000. We disagree. A trial court’s grant or denial of summary disposition under MCR 2.116(C)(10) is reviewed de novo on appeal. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998). Statutory interpretation is a question of law that is also reviewed de novo. Consumers Power Co v Dep’t of Treasury, 235 Mich App 380, 384; 597 NW2d 274 (1999).
Owners of motor vehicles required to be registered in Michigan must maintain security for payment of no-fault benefits pursuant to MCL 500.3101(1). In addition, MCL 500.3102(1) provides that nonresident owners whose automobiles are not registered in Michigan but are driven or permitted to be driven for more than thirty days in Michigan must also maintain security for payment of no-fault benefits. Under MCL 500.2163(1), insurers authorized to transact PIP insurance in Michigan (which includes plaintiff) are required to pay Michigan pip benefits to their out-of-state resident insureds in the event of a motor vehicle accident occurring in Michigan. MCL 500.3163(1) provides:
An insurer authorized to transact automobile liability insurance and personal and property protection insurance in this state shall file and maintain a written certification that any accidental bodily injury or property damage occurring in this state arising from the ownership, operation, maintenance or use of a motor vehicle as a motor vehicle by an out-of-state resident who is insured under its automobile liability insurance policies, shall be subject to the personal and property protection insurance system as set forth in this act.
The mcca was created by MCL 500.3104 to indemnify member insurers for single claims exceeding $250,000 made on Michigan policies where a premium is assessed for the claim and security is maintained by the insured. MCL 500.3104 provides in relevant part:
(1) An unincorporated, nonprofit association to be known as the catastrophic claims association, hereinafter referred to as the association, is created. Each insurer engaged in writing insurance coverages which provide the security required by section 3101(1) within this state, as a condition of its authority to transact insurance in this state, shall be a member of the association and shall be bound by the plan of operation of the association. . . .
(2) The association shall provide and each member shall accept indemnification for 100% of the amount of ultimate loss sustained under personal protection insurance coverages in excess of $250,000.00 in each loss occurrence. . . .
However, not every insurer who pays pip benefits in excess of $250,000 under the no-fault act is entitled to indemnification. Preferred Risk, supra at 725. The mcca’s obligation to indemnify is limited to those insurers who provide the coverage required by MCL 500.3101(1). Preferred Risk, supra at 714-715.
Premium payments required for membership in the mcca are determined by MCL 500.3104(7)(d), which provides in relevant part:
Each member shall be charged an amount equal to that member’s total earned car years of insurance providing the security required by section 3101(1) or 3103(1), or both, written in this state during the period to which the premium applies, multiplied by the average premium per car. The average premium per car shall be the total premium calculated divided by the total earned car years of insurance providing the security required by section 3101(1) or 3103(1) written in this state of all members during the period to which the premium applies.
Pursuant to subsections 3101(1) and 3102(1), the DeGraves were required to obtain security for pay ment of Michigan no-fault benefits after they had been in Michigan for more than thirty days, i.e., by August 16, 1992, but they failed to do so. Further, plaintiff admittedly did not pay a premium to the mcca for the DeGraves’ policy until October 17, 1997, more than five years after the DeGraves were required to comply with subsections 3101(1) and 3102(1).
In holding that plaintiff was not entitled to reimbursement from the mcca, the trial court relied on two Michigan cases, Preferred Risk, supra, and Travelers Ins, supra, which indicate that an insured’s failure to obtain security and an insurer’s failure to pay the premium as required by Michigan no-fault law prevent an insurer from being indemnified by the mcca. In Preferred Risk, supra at 727-728, our Supreme Court stated that the mcca can refuse to indemnify claims paid under MCL 500.3163. The plaintiff insurer in Preferred Risk paid no-fault benefits on an Illinois insurance policy exceeding $250,000 to an Illinois resident who was injured in an automobile accident in Michigan. A Michigan resident owned and insured the vehicle involved. Preferred Risk, supra at 716. The parties agreed that the plaintiff was required to pay benefits to its insured under MCL 500.3163, and the plaintiff paid more than $250,000 to the claimant before seeking indemnification from the mcca under MCL 500.3104. Preferred Risk, supra at 716-717. The Court found that because benefits were paid under MCL 500.3163 and not MCL 500.3101, the plaintiff was not entitled to indemnification from the mcca. Preferred Risk, supra at 727-728.
Six years later, in Travelers Ins, supra, this Court held that the MCCA will not indemnify insurers for benefits paid under MCL 500.3163 to nonresidents. The insured in Travelers was a Michigan resident who moved to Pennsylvania in July 1989, obtained a Pennsylvania driver’s license, purchased and registered a truck in Pennsylvania, and purchased a Pennsylvania insurance policy. Travelers, supra. About October 1, 1989, the insured returned to Michigan and stayed more than thirty days without informing his insurer, obtaining a Michigan driver’s license, or registering the truck in Michigan. Id. The insured was in an accident on December 9, 1989, and his passenger was injured. Id. The insured’s insurer, Travelers, paid benefits to the passenger but was unsuccessful in its attempt for indemnification from the mcca. Id.
This Court, like the Supreme Court in Preferred Risk, recognized that insurers who pay benefits to out-of-state residents under MCL 500.3163 are not entitled to reimbursement from the mcca where the insureds do not provide security as required by MCL 500.3101 and the insurers have not paid a premium to the MCCA under MCL 500.3104. However, the Court suggested that if the insurance policy had been reformed to provide the coverage required of a Michigan resident, then payments would be made as if a Michigan policy had been issued. Plaintiff here relies on this Court’s statement in Travelers regarding reformation and retroactivity to support its claim that an insurance policy can be reformed retroactively to comply with MCL 500.3101 and that after the assessment is paid, the mcca is required to indemnify. We disagree with plaintiff’s assertion. First, we note that Travelers is an unpublished opinion that is not precedentially binding on this Court. MCR 7.215(C)(1); Walker v Dep’t of Social Services, 149 Mich App 436, 442; 386 NW2d 205 (1986), aff’d 428 Mich 389; 410 NW2d 698 (1987). In addition, the discussion in Travelers regarding reformation and. retroactivity was die- turn, thereby making plaintiffs argument one that is based on unpublished dictum. Discussion of a principle of law not essential to the determination of a case is “ ‘obiter dictum’ ” and is “without the ‘force of an adjudication.’ ” Reynolds v Bureau of State Lottery, 240 Mich App 84, 95; 610 NW2d 597 (2000), quoting Roberts v Auto-Owners Ins Co, 422 Mich 594, 597-598; 374 NW2d 905 (1985).
Regarding the statement in Travelers, supra, that noted that “the policy could be reformed to provide the coverage required of a Michigan resident and payments would be made as if a Michigan policy had been issued,” we conclude that the Court was simply indicating that once there was a change in the residency of an insured, the insurer could reform the contract to comply with the coverage requirements of MCL 500.3101. Not only is that action clearly being allowed, the insured is in fact required to obtain such coverage after thirty days in Michigan. The Travelers panel did not say anything that would allow the conclusion that the reformation could be made retroactively five years after the change in the residency status of an insured as plaintiff in the present case sought to do.
However, in Travelers, supra, the Court also noted that Travelers’ normal procedure upon discovering a difference between the addresses in a policy and a notice of loss, was to “code” the policy to Michigan retroactive to the date the insured went to Michigan. The Court indicated that this would have the effect of automatically including the timeframe after the insured returned to Michigan in the “earned car days” total from which the insurer calculated the “total earned car years” figure it reported to the MCCA; therefore, the insurer “would have paid an assessment on that policy and would be entitled to indemnification.” Id. Although this language would appear to indicate that an insurer may retroactively reform a policy even after the loss or accident if the premium is paid, we do not believe that the Travelers’ panel intended to allow for a reformation five years after the fact as argued by plaintiff in this case. Indeed, to the extent that the case supports such a proposition, we decline to follow it.
First, application of the principles of statutory construction to MCL 500.3104 defeats plaintiffs argument.
The primary goal of statutory interpretation is to ascertain and give effect to the intent of the Legislature in enacting a provision. Statutory language should be construed reasonably, keeping in mind the purpose of the statute. The first criterion in determining intent is the specific language of the statute. If the statutory language is clear and unambiguous, judicial construction is neither required nor permitted, and courts must apply the statute as written. However, if reasonable minds can differ regarding the meaning of a statute, judicial construction is appropriate. [Rose Hill Center, Inc v Holly Twp, 224 Mich App 28, 32; 568 NW2d 332 (1997) (citations omitted).]
Further, statutes should be construed so as to prevent absurd results, injustice, or prejudice to the interests of the public. Camden v Kaufman, 240 Mich App 389, 395; 613 NW2d 335 (2000).
To inteipret MCL 500.3104 as requiring indemnification in a circumstance such as this where plaintiff has reformed the insurance policy would circumvent the statute and lead to an unreasonable result. In re Michigan Cable Telecommunications Ass’n Complaint, 239 Mich App 686, 692; 609 NW2d 854 (2000). Furthermore, no language in § 3104 allows a member of the MCCA to reform a non-Michigan insurance policy for the sole purpose of gaining indemnity under subsection 3104(2).
In Preferred Risk, supra at 725, our Supreme Court addressed the legislative intent regarding MCL 500.3104 and stated:
In our view, the fact that the Legislature granted the [mcca] the authority to charge premiums only with respect to policies written in Michigan providing the security required by § 3101(1) for the owners or registrants of vehicles required to be registered in the state, compels the conclusion that it intended to similarly limit the [mcca’s] liability for indemnification under § 3104(2). Put simply, we can think of no reason why the Legislature would want to provide such indemnification coverage to insurers, even member insurers who do a significant amount of business within this state, absolutely free of charge or, perhaps more appropriately, at no cost to them,. [Emphasis in original.]
Portions of MCL 500.3104 provide that the MCCA “charge to members of the association a total premium sufficient to cover the expected losses and expenses of the association which the association will likely incur during the period for which the premium is applicable,” and that the mcca “[r]equire payment of the premium in full within 45 days after the premium charge [or] [rjequire payment of the premiums to be made periodically to cover the actual cash obligations of the association.” MCL 500.3104(7)(d), (7)(e)(i), and (7)(e)(ii) (emphasis added).
We conclude that the clear language of the statute does not allow plaintiff to make a premium payment to cover a period from August 1992 through March 1993 five years after the accident and claim occurred and the covered period expired. To allow reformation of an insurance policy and allow the insurer to make a premium payment to the MCCA at the time of reformation, and not during the applicable period of coverage, would be an absurd interpretation of MCL 500.3104. If we were to accept plaintiffs argument, we would set a precedent by which an insurer could withhold premium payments for policyholders who moved to Michigan, then, upon a loss exceeding $250,000, the insurer could simply reform the contract, submit the previously due premium payments, and be reimbursed for claims paid in excess of $250,000. Under that situation, the mcca would be deprived of premiums for policies on which no claims are made, thus defeating the “spread the risk” concept in insurance. Bourne v Farmers Ins Exchange, 449 Mich 193, 200; 534 NW2d 491 (1995); see, also, Preferred Risk, supra at 729. We decline to establish such a precedent.
Next, we address the issue of reformation of the insurance contract. An automobile insurance policy may be reformed as a result of fraud, mutual mistake, or inequitable conduct. Harwood v Auto-Owners Ins Co, 211 Mich App 249, 254; 535 NW2d 207 (1995). The issue whether the insurance policy could be reformed in the present action is moot because pursuant to the consent judgment, the policy was in fact reformed. Thus, the question becomes what effect does the reformation have on defendant’s obligation to indemnify under MCL 500.3104 and the law of reformation?
In Troff v Boeve, 354 Mich 593, 598; 93 NW2d 311 (1958), our Supreme Court discussed the issue of reformation in relation to third parties not involved in any contract and stated:
It is further urged that notwithstanding the knowledge of the several plaintiffs that the easement over the driveway must be in writing, their reliance upon the oral statement of defendants’ agent could result in reformation of the deed in some cases. Possibly, but in this case there is also involved the property and rights of an innocent third party — the Boeves. If reformation of the deed is granted here the easement must be constructed over the property of defendants Boeve, who acquired such in good faith reliance upon a clear abstract of title which contained no mention of any easement.
Further, this Court has recognized that once an innocent third party is injured in an accident in which coverage was in effect with respect to the relevant vehicle, the insurer generally is estopped from asserting that the policy should be rescinded or reformed. Lake States Ins Co v Wilson, 231 Mich App 327, 331; 586 NW2d 113 (1998).
Although Troff and Wilson involve situations where a party is seeking reformation, and not where reformation has already occurred, the holdings in these two cases clearly stand for the principle that innocent third parties should not be burdened by the effects of reformation of a contract entered into by others. In the present case, the mcca could be considered an innocent third party where the result of the reformation by plaintiff and the DeGraves, if plaintiffs argument is given effect, is that the mcca would suffer a significant financial loss in indemnifying plaintiff without having received timely premium payments as required by the statute. Therefore, we conclude that the reformation should have no effect on the mcca’s right to deny indemnification under MCL 500.3104.
In effect, MCL 500.3104 creates a contract between the mcca and insurers wherein the mcca promises to indemnify insurers for claims paid by the insurers in excess of $250,000 and the insurers pay a premium to the MCCA for the coverage. In Preferred Risk, supra at 715, 716, our Supreme Court stated that “[i]n practice, the [MCCA] acts as a kind of ‘reinsurer’ for its member insurers,” and that “[l]ike any insurer, the [MCCA] charges each of its members a premium for the coverage it provides, which is based on the number of car years of insurance the member writes in Michigan.” In essence, plaintiff is requesting that an insurance claim be paid where no timely premium was paid, where plaintiff attempted to pay the premium after it was due, and after the insurance claim was made. Plaintiff’s argument simply cannot withstand scrutiny.
In Glass v Harvest Life Ins Co, 168 Mich App 667, 670; 425 NW2d 107 (1988), the decedent’s brother directed his wife, after the decedent’s death, to mail a predated check to the defendant insurer in order to cover a late life insurance premium. This Court held that “[t]he policy terminated when the decedent failed to pay the premium within the contractual grace period.” However, the Court in Glass also held that the defendant insurer waived its right to assert the policy lapse by accepting the late premium payment without further review or investigation. Id. at 670-671.
In Auto Club Ins Ass’n v Dennie, 188 Mich App 634, 635-636; 470 NW2d 409 (1991), the defendant was involved in an automobile accident. He had failed to timely pay a premium, but the insurer received a late premium payment three days before the accident. The Dennie Court found in favor of the insurer and denied coverage on the basis that “[t]he mere temporary retention of premium payments, without more, however, is conditional and does not bind the insurer to provide coverage if there is a prompt refund of premium upon the full facts concerning the status of the policy becoming known to the insurer.” Id. at 637.
Turning to the present case and considering the relationship between the mcca and plaintiff as an insurer and insured, the MCCA rejected the late premium payment from plaintiff that was made on the basis of the reformation of the insurance policy. Because the premium payment was tendered after the coverage period expired and after the accident occurred, Michigan case law regarding general insurance principles does not support a finding that the MCCA be required to indemnify plaintiff.
III. Conclusion
The trial court did not err in granting the mcca’s motion for summary disposition under MCR 2.116(C)(10) because the reformation of the DeGraves’ California automobile insurance policy into a Michigan insurance policy complying with Michigan no-fault law is ineffective; consequently, defendant was entitled to a judgment as a matter of law.
We affirm.
MCL 500.3101(1) provides in relevant part:
The owner or registrant of a motor vehicle required to be registered in this state shall maintain security for payment of benefits under personal protection insurance, property protection insurance, and residual liability insurance.
We note, however, that Lake States, supra at 331-332, states further that reformation or rescission may occur if fraud or a material misrepresentation occurred, the insurance coverage was considered optional, and the fraud could not have been ascertained easily by the insurer. That is not the case here. | [
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Cavanagh, P. J.
Plaintiffs appeal as of right from the trial court’s grant of summary disposition, pursuant to MCR 2.116(C)(10), in favor of defendant in this negligence action. We reverse and remand for further proceedings.
This action arises as a consequence of injuries sustained by plaintiff, Reed J. Van Guilder, while riding an off-road recreation vehicle (orv). In July 1998, plaintiff and defendant, Brad Collier, were each riding four-wheel ORVs on vacant land. In the course of attempting to travel up a hill, plaintiff’s ORV began slowing and experiencing difficulty as it neared the top of the hill. Defendant, who was riding his ORV directly behind plaintiff, gave his ORV some gas and “nudged” the rear of plaintiff’s orv in an apparent attempt to push plaintiff to the top of the hill. However, instead, plaintiff’s ORV flipped over backwards, throwing plaintiff onto the ground where he landed on his back. Defendant, who was “going at a pretty good speed,” proceeded to run over plaintiff. As a consequence of the incident, plaintiff allegedly sustained injuries, including a broken neck.
Thereafter, plaintiffs filed this negligence action. The trial court, relying on Ritchie-Gamester v Berkley, 461 Mich 73; 597 NW2d 517 (1999), granted defendant’s motion for summary disposition, holding that the standard of care for claims arising out of recreational activity is recklessness and plaintiffs’ allegations, as well as the evidence, supported only a claim of ordinary negligence. The trial court also denied plaintiffs’ motion to amend their complaint to include a count of recklessness, holding that such amendment would be futile because it was unsupported by the evidence. Subsequently, plaintiffs moved for reconsideration, arguing that the applicable standard of care is negligence and that Ritchie-Gamester was inapplicable because the operation of orvs was not the type of “recreational activity” contemplated by the holding. The trial court denied plaintiffs’ motion.
On appeal, plaintiffs argue that the trial court erred in applying a recklessness standard of care because the type of recreational activity considered in Ritchie-Gamester did not include the operation of motorized recreation vehicles. We agree. This Court reviews de novo a trial court’s grant or denial of summary disposition. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998).
To establish a prima facie case of negligence, a plaintiff must prove four elements: “(1) the defendant owed a duty to the plaintiff, (2) the defendant breached that duty, (3) the defendant’s breach was a proximate cause of the plaintiff’s injuries, and (4) the plaintiff suffered damages.” Spikes v Banks, 231 Mich App 341, 355; 586 NW2d 106 (1998). In this case, the issue is whether defendant owed plaintiff a duty to avoid negligent conduct or merely to avoid reckless conduct in the operation of his ORV. We conclude that the applicable standard of care is negligence.
In Ritchie-Gamester, supra, the plaintiff was injured while ice skating during an open skating session when another skater, who had been skating backwards, ran into her causing her to fall and allegedly sustain injuries. The plaintiff brought an action against the skater alleging negligence and our Supreme Court affirmed the trial court’s dismissal of the case, holding that “coparticipants in a recreational activity owe each other a duty not to act recklessly.” Id. at 95. The Supreme Court premised its holding, in part, on the proposition that persons who engage in recreational activities temporarily adopt a set of rules applicable to the particular pastime or sport and, by the nature of the activities, inherent risks of harm are foreseeable. Id. at 86, 88.
The instant case, however, is distinguishable from Ritchie-Gamester. In that case, the Court primarily focused its analysis on injuries sustained during the course of recreational activities that typically or foreseeably involve physical contact between coparticipants. To the contrary, a person operating a motorized recreation vehicle does not reasonably expect or anticipate the risk of physical contact, nor is such risk an obvious or necessary danger inherent to its normal operation. The Ritchie-Gamester Court did not contemplate injuries that occur as a result of physical contact between two such vehicles. This distinction is dispositive. We decline to adopt defendant’s speculative conclusion that our Supreme Court intended that a recklessness standard of care apply with regard to the operation of motorized recreation vehicles simply because they are usually used for recreational purposes. The operation of motor vehicles, including ORVs, is not governed by the “rules of the game,” but by the law.
A “motor vehicle” is defined by the Michigan Vehicle Code (mvc), MCL 257.33, as “every vehicle that is self-propelled . ...” A “vehicle” is further defined by the MVC as “every device in, upon, or by which any person or property is or may be transported or drawn upon a highway . . . .” MCL 257.79. An ORV is self-propelled and “may be transported or drawn upon a highway”; therefore, it is a motor vehicle under the MVC. Further, this Court has held that ORVs are vehicles to which certain provisions of the mvc apply. See People v O’Neal, 198 Mich App 118, 120; 497 NW2d 535 (1993). Subsection 401(1) of the civil liability act of the mvc, MCL 257.401(1), allows for the imposition of liability for injury caused by ordinary negligence in the operation of a motor vehicle. See Alex v Wildfong, 460 Mich 10, 16; 594 NW2d 469 (1999). Whether MCL 257.401(1) applies to the operation of an ORV appears to present an issue of first impression; however, we hold that the statute is controlling and imposes a negligence, rather than a recklessness, standard of care.
The primary goal of statutory interpretation is to give effect to the intent of the Legislature. In re Mes ser Trust, 457 Mich 371, 379-380; 579 NW2d 73 (1998). This Court first looks to the specific language of the statute to discern the intent of the Legislature. Charboneau v Beverly Enterprises, Inc, 244 Mich App 33, 40; 625 NW2d 75 (2000). If the plain and ordinary meaning of the language of the statute is clear, judicial construction is inappropriate. Id. Further, statutes that relate to the same subject or that share a common purpose are in pari materia and must be read together as one law, even if they were enacted on different dates. Travelers Ins v U-Haul of Michigan, Inc, 235 Mich App 273, 279-280; 597 NW2d 235 (1999).
In this case, it appears that two statutory schemes apply to the operation of orvs; the off-road recreation vehicles section of the Natural Resources and Environmental Protection Act (nrepa), MCL 324.81101 el seq., and the mvc, specifically the civil liability act, MCL 257.401. MCL 257.401(1) provides, in relevant part:
This section shall not be construed to limit the right of a person to bring a civil action for damages for injuries to either person or property resulting from a violation of this act by the owner or operator of a motor vehicle or his or her agent or servant. The owner of a motor vehicle is liable for an injury caused by the negligent operation of the motor vehicle whether the negligence consists of a violation of a statute of this state or the ordinary care standard required by common law.
The off-road recreation vehicles section of the nrepa does not contain a particular provision that provides for civil liability arising from the operation of an ORV. Because both these statutory schemes relate to the same subject, i.e., motor vehicles, and are harmonious and complementary, the in pari materia doctrine is applicable and we read them together as one law. See State Treasurer v Schuster, 456 Mich 408, 417; 572 NW2d 628 (1998), quoting Detroit v Michigan Bell Telephone Co, 374 Mich 543, 558; 132 NW2d 660 (1965); Travelers Ins, supra; M & S, Inc v Attorney General, 165 Mich App 301, 306-307; 418 NW2d 441 (1987). Consequently, an ORV is a motor vehicle for purposes of the civil liability act; therefore, liability may be imposed for its negligent operation.
Accordingly, the trial court erred in granting defendant’s motion for summary disposition. In consideration of our resolution of this dispositive issue, we need not review plaintiffs’ remaining issues on appeal.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
Plaintiff Lone Ann Van Guilder alleged loss of consortium caused by her husband’s injuries. Because her claim is derivative, the term “plaintiff” refers only to Reed J. Van Guilder.
Similarly, our Supreme Court has held that a moped and a snowmobile are motor vehicles within the ambit of the mvc. See People v Rogers, 438 Mich 602, 605-606; 475 NW2d 717 (1991); Farm Bureau Mut Ins Co of Michigan v Stark, 437 Mich 175, 183; 468 NW2d 498 (1991), overruled in part on other grounds, Smith v Globe Life Ins Co, 460 Mich 446, 455, n 2; 597 NW2d 28 (1999).
The standard of care imposed regarding the operation of personal watercraft is also negligence. See MCL 324.80207.
Statutes governing off-road recreational vehicles were included in the mvc, MCL 257.1601 to 257.1626, until they were repealed by 1995 PA 58, § 90106, effective May 24, 1995, and reenacted, in large part, by 1995 PA 58, § 1, as part 811 of the recreation chapter of the nrepa, and are codified at MCL 324.81101 et seq.
Further, in this case, an action under the civil liability act is not barred by the no-fault insurance act, MCL 500.3135, because ORVs are exempted from the no-fault insurance act. See MCL 324.81106; see, also, Travelers Ins, supra at 284-285; Morris v Allstate Ins Co, 230 Mich App 361, 368-369; 584 NW2d 340 (1998). | [
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O’Connell, J.
Plaintiff Michael McCaul appeals by leave granted from the October 14, 1999, order of the Worker’s Compensation Appellate Commission (wcac) affirming the magistrate’s denial of disability benefits. We affirm.
I. FACTS AND PROCEEDINGS
The facts in this case are essentially undisputed. Plaintiff began his employment with defendant Modem Tile and Carpet, Inc., in 1976 performing carpet installation. Approximately seven or eight years before the trial in this matter, plaintiff created a sole proprietorship and acquired a worker’s compensation insurance policy at defendant’s insistence. From then on, rather than paying plaintiff directly, defendant compensated plaintiff for his services by issuing checks jointly to plaintiff and the sole proprietorship. For the most part, plaintiff’s day-to-day duties with defendant did not change after the sole proprietorship was formed. However, plaintiff was required to sign a contract identifying him as an independent contractor for each job he performed for defendant. In 1996, plaintiff reported his income on an Internal Revenue Service (irs) Form 1099 and filed a schedule C, Profit or Loss from Business (Sole Proprietorship) return with the irs.
In 1996, after plaintiff developed right-sided lateral epicondylitis in his right elbow, he was restricted from performing carpet installations. The parties do not dispute that plaintiff suffered a work-related disability. Plaintiff filed a petition seeking worker’s compensation benefits in November 1996. During trial before the magistrate, defendant argued that because plaintiff was an independent contractor, it was not responsible for payment of worker’s compensation benefits. In contrast, plaintiff asserted that because defendant controlled and supervised his activities, he was defendant’s employee, and defendant was required to pay plaintiff’s worker’s compensation benefits.
In an opinion and order mailed January 21, 1998, the magistrate denied plaintiff’s claim against defendant, concluding that plaintiff had “failed to establish an employee/employer relationship” with defendant. In reaching its conclusion, the magistrate reviewed subsection 161(l)(d) of the Worker’s Disability Compensation Act (wdca), MCL 418.101 et seq. Specifically, the magistrate found that plaintiff was not an “employee” as defined by that provision because he maintained a sole proprietorship and held himself out as rendering services to the public. In support of its conclusion, the magistrate considered evidence showing that plaintiff actively managed his sole proprietorship, secured worker’s compensation insurance, and filed the appropriate tax forms for a sole proprietorship. Further, the magistrate found that although plaintiff did not advertise his business, he held him self out as willing to perform services for the public. The magistrate also observed that “plaintiff’s testimony was clear that if he had not been kept busy by [defendant], he would have been able to accept more jobs from the public.”
On appeal to the wcac, plaintiff argued (1) that the magistrate erred in concluding that plaintiff was not an employee as defined in the wdca, and (2) that defendant violated MCL 418.171(4) by insisting plaintiff create a sole proprietorship so that defendant could avoid having to carry worker’s compensation insurance. In a two-to-one decision, the wcac affirmed the magistrate’s determination that plaintiff was not an employee as defined by § 161 because the record evidence supported the magistrate’s finding that plaintiff owned a sole proprietorship. Moreover, the wcac concluded that where plaintiff alleged that defendant violated MCL 418.171(4), the wdca required that he seek redress in a civil action. This Court granted plaintiff leave to appeal on March 7, 2000.
n. standard of review
This Court’s review of a decision of the WCAC is limited. Blanzy v Brigadier General Contractors, Inc, 240 Mich App 632, 637; 613 NW2d 391 (2000). In the absence of fraud, this Court must consider the wcac’s findings of fact conclusive. MCL 418.861a(14). In Mudel v Great Atlantic & Pacific Tea Co, 462 Mich 691; 614 NW2d 607 (2000), Justice Markman, writing for the Court, articulated the proper standard for reviewing decisions of the wcac.
The wcac must review the magistrate’s decision under the “substantial evidence” standard, while the courts must review the wcac’s decision under the “any evidence” standard. Review by the Court of Appeals and [the Supreme Court] begins with the wcac’s decision, not the magistrate’s. If there is any evidence supporting the wcac’s factual findings, and if the wcac did not misapprehend its administrative appellate role in reviewing decisions of the magistrate, then the courts must treat the wcac’s factual findings as conclusive. [Id. at 709-710.]
However, this Court reviews de novo questions of law involved in a final order of the WCAC. DiBenedetto v West Shore Hosp, 461 Mich 394, 401; 605 NW2d 300 (2000); Mudel, supra at 697, n 3; MCL 418.861a(14). “[A] decision of the wcac is subject to reversal if it is based on erroneous legal reasoning or the wrong legal framework.” DiBenedetto, supra at 401-402.
m. ANALYSIS
We first address plaintiff’s contention that the WCAC erred in affirming the magistrate’s determination that plaintiff was an independent contractor, and not an employee as defined by the wdca. Whether an individual is an employee as defined by the wdca presents a question of law subject to review de novo. Oxley v Dep’t of Military Affairs, 460 Mich 536, 540; 597 NW2d 89 (1999).
At the time of plaintiff’s injury, MCL 418.161(l)(d) provided:
(1) As used in this act, “employee” means:
(d) Every person performing service in the course of the trade, business, profession, or occupation of an employer at the time of the injury, provided the person in relation to this service does not maintain a separate business, does not hold himself or herself out to and render service to the public, and is not an employer subject to this act.
All three conditions of subsection 161(l)(d) must be met in order to find that an individual is an employee. Luster v Five Star Carpet Installations, Inc, 239 Mich App 719, 725; 609 NW2d 859 (2000); Amerisure Ins Cos v Time Auto Transportation, Inc, 196 Mich App 569, 574; 493 NW2d 482 (1992). As the Luster Court opined:
[A] person is not an employee (but is an independent contractor) under subsection 161(l)(d) if any one or more of the following applies: (1) the person maintains a separate business in relation to the service, (2) the person holds himself out to and renders service to the public in relation to the service, or (3) the person is an employer subject to the worker’s compensation statute in relation to the service. [Luster, supra at 725 (emphasis in original).]
To the extent that plaintiff insists that he was defendant’s employee as defined by the wdca because defendant closely controlled and supervised his activities, plaintiff’s argument implicates the common-law-derived “economic realities test.” In Hoste v Shanty Creek Management, Inc, 459 Mich 561, 572; 592 NW2d 360 (1999), our Supreme Court concluded that the Legislature, by amending § 161 of the wdca in 1985 to add subsection d, manifested its intention that the statutory provision define the term “employee.” Consequently, the new language of the statute effectively superseded several factors comprising the economic realities test. Id; Blanzy, supra at 642.
In considering whether plaintiff was defendant’s employee, both the magistrate and the WCAC considered the factors set forth in subsection 161(l)(d). Specifically, the WCAC rejected plaintiff’s claim for benefits against defendant because there was ample record support for the magistrate’s factual determination that plaintiff maintained a separate carpet installation business. Absent fraud, the wcac’s findings are conclusive on appeal. Mudel, supra at 709-710, Moreover, we agree with the wcac’s determination that plaintiff was not an employee as defined by subsection 161(l)(d) because he operated a sole proprietorship. For example, defendant did not pay plaintiff as an employee because defendant did not withhold money from plaintiff’s paycheck for taxes. Luster, supra at 727. Rather, plaintiff was paid as an independent contractor who ran his own business, where defendant provided plaintiff with a Form 1099 annually and his income was not reported on a Form W-2. Id. Likewise, plaintiff furnished his own equipment and supplies. Plaintiff also held himself out as providing services to the public, and did in fact do so on several occasions. These findings support the wcac’s conclusion that plaintiff ran his own business and was therefore not an employee under § 161 of the WDCA. Id.
In a related argument, plaintiff asserts that he is entitled to benefits because defendant is his “statutory employer” pursuant to MCL 418.171. See, e.g., Blanzy, supra at 635. Whatever the merit of this legal argument, it was not raised before or addressed by the WCAC. Consequently, this Court is without statutory authority to consider it on appeal. Calovecchi v Michigan, 461 Mich 616, 626; 611 NW2d 300 (2000); see also Alford v Pollution Control Industries of America, 222 Mich App 693, 699; 565 NW2d 9 (1997).
IV. MCL 418.171(4)
On appeal, plaintiff also argues that the WCAC erred in concluding that by allegedly encouraging plaintiff to become a sole proprietor, defendant did not violate MCL 418.171(4). As a preliminary matter, we note that plaintiff mischaracterizes the wcac’s conclusion. Our review of the record reveals that the WCAC did not make the specific determination that plaintiff asserts. In contrast, the WCAC merely concluded that it was without jurisdiction to address the merit of plaintiff’s claim because the plain language of subsection 171(4) required plaintiff to bring forth a civil action. A review of the wcac’s ruling is instructive.
Plaintiff also makes the interesting legal argument that, since [defendant] “forced” him to become an independent contractor it is in violation of MCL 418.171(4).
:|: * *
We observe that section 171 refers to [MCL 418.641]. Section 641(2) gives plaintiff’s recourse for [a] violation of section 171:
“The employee of an employer who violates the provisions of section 171 or 611 shall be entitled to recover damages from the employer in a civil action because of an injury that arose out of and in the course of employment notwithstanding the provision of section 131.”
Because this Commission does not oversee civil actions but administrative actions, we cannot address the violation of section 171 but refer plaintiff to his civil remedy. [Emphasis supplied.]
We review issues requiring statutoiy construction de novo as questions of law. Adams v Linderman, 244 Mich App 178, 184; 624 NW2d 776 (2000). When considering the apphcability of § 171 to plaintiffs claim, we are mindful that “the worker’s compensation act is remedial in nature, and must be ‘liberally construed to grant rather than deny benefits.’ ” Hagerman v Gencorp Automotive, 457 Mich 720, 739; 579 NW2d 347 (1998), quoting Sobotka v Chrysler Corp (After Remand), 447 Mich 1, 20, n 18; 523 NW2d 454 (1994) (opinion of Boyle, J.). Further the wcac’s interpretation and application of a provision of the WDCA is entitled to “considerable deference” from this Court where that interpretation is not “clearly incorrect.” Rahman v Detroit Bd of Ed, 245 Mich App 103, 117; 627 NW2d 41 (2001), citing Jones-Jennings v Hutzel Hosp (On Remand), 223 Mich App 94, 105; 565 NW2d 680 (1997). We are also guided by the following well-settled principles of statutory construction.
When reviewing questions of statutory construction, [this Court’s] purpose is to discern and give effect to the Legislature’s intent. Murphy v Michigan Bell Telephone Co, 447 Mich 93, 98; 523 NW2d 310 (1994). We begin by examining the plain language of the statute. Where that language is unambiguous, we presume that the Legislature intended the meaning clearly expressed — no further judicial construction is required or permitted, and the statute must be enforced as written. Tryc v Michigan Veterans’ Facility, 451 Mich 129, 135; 545 NW2d 642 (1996). We must give the words of a statute their plain and ordinary meaning, and only where the statutory language is ambiguous may we look outside the statute to ascertain the Legislature’s intent. Turner v Auto Club Ins Ass’n, 448 Mich 22, 27; 528 NW2d 681 (1995). [DiBenedetto, supra at 402.]
Subsection 171(4) provides in pertinent part:
Principals willfully acting to circumvent the provisions of this section or [MCL 418.611] by using coercion, intimidation, deceit, or other means to encourage persons who would otherwise be considered employees within the meaning of this act to pose as contractors for the purpose of evading this section or the requirements of [MCL 418.611] shall be liable subject to the provisions of [MCL 418.641]. [Footnotes omitted.]
The plain language of subsection 171(4) refers to MCL 418.641, the pertinent portion of which provides as follows:
(2) The employee of an employer who violates the provisions of [MCL 418.171] or [MCL 418.611] shall be entitled to recover damages from the employer in a civil action because of an injury that arose out of and in the course of employment notwithstanding the provisions of [MCL 418.131],
Subsection 171(4) was enacted as part of the 1985 amendments of the wdca. See 1985 PA 103. This part of the WDCA addresses what are commonly referred to as statutory employers. See, e.g., Burger v Midland Cogeneration Venture, 202 Mich App 310, 314; 507 NW2d 827 (1993); Blanzy, supra at 639. Section 171 was intended to protect employees of contractors and subcontractors who failed to procure adequate worker’s compensation insurance. Smith v Park Chemical Co, 154 Mich App 180, 182; 397 NW2d 260 (1986). According to its plain language, subsection 171(4) provides independent contractors who would otherwise be considered employees under the wdca a vehicle for recovery where their employer has attempted to circumvent the provisions of § 171 or § 611. “Section 611 governs worker’s compensation liability insurance coverage for employers.” Blanzy, supra at 639. The express language of subsection 171(4) provides that an individual may properly seek redress according to the provisions of § 641 of the WDCA where the employer does not comply with the provisions of § 171 or § 611.
Subsection 641(2) was also enacted as part of the 1985 amendments of the WDCA. See 1985 PA 103; McGillis v Aida Engineering, Inc, 161 Mich App 370, 372; 410 NW2d 817 (1987). Subsection 641(2) provides that where an individual’s employer violates the provisions of § 611 or § 171, the individual “shall be entitled to recover damages from the employer in a civil action because of an injury that arose out of and in the course of employment” notwithstanding the exclusive remedy provision of MCL 418.131. (Emphasis supplied.) In Smeester v Pub-N-Grub, Inc, 442 Mich 404; 500 NW2d 742 (1993) (Smeester I), our Supreme Court observed that subsection 641(2) allowed an individual to seek redress in a civil action for an employer’s failure to secure worker’s compensation insurance.
When an employer fails to secure the payment of compensation to an employee who is injured in the course of employment, § 641(2) of the Worker’s Compensation Disability Act allows the injured employee to bring a civil action for damages against the employer. [Id. at 404-405. ]
Subsequently, in Smeester v Pub-N-Grub, Inc (On Remand), 208 Mich App 308, 312; 527 NW2d 5 (1995) (Smeester II), this Court echoed the Supreme Court’s conclusion that subsection 641(2) “restore[d] the employee’s common-law right to sue the employer . . . .” Moreover, this Court went on to consider the nature of an individual’s common-law action against his employer, concluding that “traditional tort damages, including those for emotional distress and loss of consortium” were recoverable if the employee proved that the employer was “in some respect negligent.” Id. at 312-313. The Smeester II Court further observed:
[W]e hold: (1) negligence is an element of an employee’s cause of action against an employer under § 641(2); (2) an employer may not assert as a defense the negligence of the employee, unless that negligence is wilful, MCL 418.141; MSA 17.237(141); and (3) an employee’s damages are not limited to the worker’s compensation benefits available pursuant to the wdca. [Id. at 315.]
More recently, in State Farm Mut Automobile Ins Co v Roe (On Rehearing), 226 Mich App 258, 265-266; 573 NW2d 628 (1997), app dis 459 Mich 880 (1998), a panel of this Court likewise concluded that pursuant to subsection 641(2), “[i]f an employer fails to comply with the insurance requirements of the worker’s com pensation act... it is liable in tort for injuries to its employees” (emphasis supplied); see also Director, Bureau of Worker’s Disability Compensation v BMC Mfg, Inc, 200 Mich App 478; 504 NW2d 695 (1993); McGillis, supra at 372.
In light of the foregoing, we agree with the wcac’s interpretation of subsection 171(4) and subsection 641(2). Because plaintiff has alleged that defendant violated subsection 171(4) of the wdca by failing to secure insurance liability coverage pursuant to § 611, the plain language of both § 171 and § 641 require plaintiff to pursue his claim in a civil action.
Affirmed.
Although this Court and our Supreme Court have spoken on the issue whether an individual may properly bring a civil claim against an employer pursuant to MCL 418.641(2), plaintiff’s appeal raises a distinct issue, that being whether MCL 418.171(4) requires plaintiff to pursue in the civil forum a claim alleging that defendant wilfully circumvented provisions of the worker’s compensation act by encouraging him to become an independent contractor. This is an issue of first impression in Michigan.
Defendants Michael McCaul, doing business as McCaul’s Carpet Service, and Citizens Insurance Company were dismissed by .stipulation as parties to this appeal by an order entered August 2, 2001. For the purposes of this appeal, “defendant” will refer to Modem Hie and Carpet, Inc.
As a result of legislative revisions to MCL 418.161 in 1996, subsection 161(1)(d) has been redesignated subsection 161(1)(n).
Commissioner James J. Kent dissented on grounds unrelated to those at issue on appeal.
According to the record, plaintiff’s date of injury was March 29, 1996.
Although these considerations are reminiscent of the economic realities test superseded by § 161, they remain “valid considerations under Hoste here because they are relevant to establishing that plaintiff conducted his own business in the context of providing services for defendant .. . Luster, supra at 727, n 3.
MCL 418.131(1) provides in pertinent part:
The right to recovery of benefits as provided in this act shall be the employee’s exclusive remedy against the employer for a personal injury or occupational disease. The only exception to this exclusive remedy is an intentional tort.
The Supreme Court’s comments were made in the context of a memorandum opinion remanding the case to this Court. Specifically, the Supreme Court directed this Court to consider whether “in a cause of action brought pursuant to MCL 418.641(2); MSA 17.237(641)(2), an employee may recover damages without first having to show the negligence of the employer.” Smeester I, supra at 408.
We also reject plaintiff’s claim that our conclusion results in “duplicative litigation.” While we recognize that “it is abhorrent to the fundamental principles of the wdca to allow any form of double recovery,” Smeester II, supra at 314, no such double recovery will occur in the instant case, because plaintiff was denied benefits in the administrative forum of the WCAC. | [
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Cavanagh, J.
Plaintiff, Richard D. Persinger, conservator of the estate of Helen Fuite, appeals as of right from the trial court’s grant of summary disposition in favor of defendant in this legal malpractice action. We affirm.
In January 1996, defendant, Richard C. Holst, an attorney, was contacted by Mark Hall (Hall) regarding estate planning services on behalf of Helen Fuite, a widow in her eighties. Hall and his brother, Tim Hall, had previously been Holst’s clients. Subsequently, Holst drafted and Fuite executed a will, a durable general power of attorney, and at least two deeds. The will named Hall the sole beneficiary of Fuite’s estate to the explicit exclusion of her relatives; the power of attorney designated Hall as Fuite’s attorney in fact effective as of the date of execution; and two deeds transferred two parcels of property from Fuite to Hall and herself as joint tenants with rights of survivorship.
It is undisputed that Hall abused his powers as Fuite’s attorney in fact, in particular with regard to Fuite’s financial affairs. Consequently, in April 1996, probate proceedings were initiated and Persinger was appointed conservator of Fuite’s estate. Persinger initiated additional probate proceedings regarding the dispositions made by Fuite in January 1996. The proceedings apparently culminated in an order and judgment that provided, in pertinent part, for Hall to quitclaim the real properties back to Fuite, for the will to be set aside, for money to be paid to Fuite by Hall and his brother, and permanently restrained Hall and his brother from further contact with Fuite. Thereafter, the present action was commenced against defendant alleging several claims, including legal malpractice, with regard to the “estate planning services” rendered to Fuite. Following defendant’s motions for summary disposition pursuant to MCR 2.116(C)(8) and (C)(10), the trial court dismissed all of plaintiff’s claims.
On appeal, plaintiff argues that the trial court erred in holding that an attorney has no duty to dissuade a vulnerable client from her choice of attorney in fact when the attorney knows that the proposed agent is incapable of handling the client’s affairs. Plaintiff further argues that the trial court erred in holding that mental competency is not required to execute a power of attorney and, consequently, that defendant had no duty to prevent Fuite from executing the document. This Court reviews de novo a trial court’s grant or denial of summary disposition. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998).
A claim of legal malpractice requires the plaintiff to plead and prove the following elements: “(1) the existence of an attorney-client relationship; (2) negligence in the legal representation of the plaintiff; (3) that the negligence was a proximate cause of an injury; and (4) the fact and extent of the injury alleged.” Simko v Blake, 448 Mich 648, 655; 532 NW2d 842 (1995), quoting Coleman v Gurwin, 443 Mich 59, 63; 503 NW2d 435 (1993). If there is an attorney-client relationship, a duty to use and exercise reasonable care, skill, discretion, and judgment with regard to the representation of the client exists as a matter of law. Simko, supra at 655-656, quoting Eggleston v Boardman, 37 Mich 14, 16 (1877). In this case, it is undisputed that an attorney-client relationship existed between Fuite and Holst; therefore, the issue is whether Holst breached a duty by failing to dissuade Fuite from her choice of agent or by permitting Fuite to execute a power of attorney. This issue appears to present questions of first impression in Michigan.
Generally, a power of attorney is a written instrument by which a principal authorizes and appoints an agent, known as an attorney in fact, and delegates to the agent the power to perform acts on behalf of, in the place of, and instead of the principal. See 3 Am Jur 2d, Agency, §§ 1-3, 23, pp 509-511, 528; Black’s Law Dictionary (7th ed), p 1191. It is a legal document recognized by law as evidence of an agency relationship between the principal and the agent. See, e.g., MCL 450.4103(3), 565.36, 700.1103(a), 700.5103, 700.5502, 700.5504; VanderWall v Midkiff, 166 Mich App 668, 677; 421 NW2d 263 (1988). A firmly embedded principle in our jurisprudence is that legal documents must be executed by one possessing the mental competence to reasonably understand the nature and effect of his action.
Established law is replete with examples of this competency requirement, particularly in the area of contract law. Persons entering into business contracts and settlement agreements, opening bank accounts and changing insurance policy beneficiaries must, generally, possess “sufficient mind to understand in a reasonable manner the nature and effect of the act in which the person is engaged.” In re Erickson Estate, 202 Mich App 329, 332; 508 NW2d 181 (1993); see, also, Bannasch v Bartholomew, 350 Mich 546, 554; 87 NW2d 78 (1957); Howard v Howard, 134 Mich App 391, 396; 352 NW2d 280 (1984). Similarly, persons executing deeds of conveyance must have
sufficient mental capacity to understand the business in which he was engaged, to know and understand the extent and value of his property, and how he wanted to dispose of it, and to keep these facts in his mind long enough to plan and effect the conveyances in question without prompting
A person executing a will must have testamentary capacity, i.e., “ ‘be able to comprehend the nature and extent of his property, to recall the natural objects of his bounty, and to determine and understand the disposition of property which he desires to make.’ ” In re Vollbrecht Estate, 26 Mich App 430, 434; 182 NW2d 609 (1970), quoting In re Sprenger’s Estate, 337 Mich 514, 521; 60 NW2d 436 (1953). Consistent with this longstanding precedent, as well as the purpose of a power of attorney, statutory inferences, and sound public policy, we hold that powers of attorney must be executed by mentally competent persons.
A primary purpose of a power of attorney is to evidence the delegation of authority to perform particular legal acts, which the principal could personally perform, to an appointed agent. See 3 Am Jur 2d, Agency, § 23, p 528. Consequently, the principles governing the law of agency are applicable to legal issues involving powers of attorney. See VanderWall, supra. A fundamental requirement of such an agency relationship is that the parties to the agreement consent to its creation. See 3 Am Jur 2d, Agency, § 17, p 521. Similarly, an essential component of the relationship is the principal’s right to control, at least at some point, the conduct and actions of his agent. See St Clair Intermediate School Dist v Intermediate Ed Ass’n/Michigan Ed Ass’n, 458 Mich 540, 557-558; 581 NW2d 707 (1998); People v Konrad, 449 Mich 263, 280-281; 536 NW2d 517 (1995). These consent and control elements are significant because the principal is bound by, and hable for, the agent’s lawful actions performed under the auspices of the principal’s actual or apparent authority. Id.) see, also, e.g., MCL 700.5502, 700.5504. Consequently, requiring that the principal be mentally competent to consent to, render a degree of control over, and appreciate the significance and consequences of the resulting agency relationship is consonant with the purpose of a power of attorney.
Further, review of related statutes supports the conclusion that the principal must be mentally competent at the time the power of attorney is executed. MCL 700.5501 provides, in pertinent part:
A durable power of attorney is a power of attorney by which a principal designates another as the principal’s attorney in fact in writing and the writing contains the words “This power of attorney is not affected by the principal’s subsequent disability or incapacity, or by the lapse of time”, or “This power of attorney is effective upon the disability or incapacity of the principal”, or similar words showing the principal’s intent that the authority conferred is exercisable notwithstanding the principal’s subsequent disability or incapacity .... [Emphasis added.]
MCL 700.5504(2) provides, in pertinent part:
The disability or incapacity of a principal who has previously executed a written power of attorney that is not a durable power does not revoke or terminate the agency as to the attorney in fact or other person who, without actual knowledge of the principal’s disability or incapacity, acts in good faith under the power. An action taken as provided in this subsection, unless otherwise invalid or unenforce able, binds the principal and his or her successors in interest. [Emphasis added.]
MCL 700.5505(1) provides, in pertinent part:
If an attorney in fact acts in good-faith reliance on a power of attorney, durable or otherwise, and executes a sworn statement stating that, at the time of the action, the attorney in fact did not have actual knowledge of the principal’s death, disability, or incapacity or of the power’s termination by revocation, the sworn statement is, in the absence of fraud, conclusive proof of the power’s nontermination or nonrevocation.
Similarly, MCL 700.5506, pertaining to the designation of a patient advocate for proposes of medical treatment, custody, and care decisions, specifically requires the patient to be of sound mind at the time the designation is made. These statutes clearly imply the requirement that the principal be mentally competent at the inception of the agency relationship, i.e., at the time the power of attorney is executed.
Finally, requiring the principal of a power of attorney to be mentally competent at the time of its execution advances important public policy concerns. We are hardpressed to conceive of a more effective and efficient means by which to devastate and destroy the estate of a vulnerable person than through a durable general power of attorney. Sanctioning the execution of a power of attorney by a mentally incompetent principal would give license to those who have the power or inclination to coerce, cajole, or dupe such a person into effectively relinquishing rights to their property, finances, and other assets with minimal effort. Considering the nature, breadth, and consequences of a power of attorney, public policy inter ests are served by the requirement that the principal have the ability to engage in thoughtful deliberation and use reasonable judgment with regard to its formation.
Although we have concluded that powers of attorney must be executed by mentally competent principals, we must still consider the extent of an attorney’s duty with regard to the principal’s choice of agent and mental competency to execute the document.
In this case, plaintiff first argues that defendant had a duty to dissuade Fuite from her choice of agent because defendant knew the proposed agent was incapable of handling Fuite’s affairs. Plaintiff alleges that defendant’s knowledge that Hall was “an illiterate, financial incompetent” gave rise to an obligation to “prevent the fleecing” of Fuite. We disagree and decline to impose such an extraordinary duty on defendant.
An attorney has a duty to use reasonable skill, care, discretion, and judgment in the provision of legal services. Símico, supra at 656. “An attorney is never bound to exercise extraordinary diligence, or act beyond the knowledge, skill, and ability ordinarily possessed by members of the legal profession.” Id. In this case, defendant had a duty to use reasonable care and skill to draft a power of attorney that comported with Fuite’s intentions and legally accomplished her objectives. We have failed to ascertain any authority that would impose the additional burden of ensuring that Fuite, the principal, designated an appropriate agent. See 3 Am Jur 2d, Agency, § 13, p 519 (“As a rule, any person has the capacity to act for another . . . .”).
The lack of such authority is likely the consequence of several inherent problems with the proposition, including that such a burden would impermissibly widen the scope of duty to infinite proportions. An attorney could then be hable for allegedly failing to challenge a client’s choice of business partner, personal representative, or other person to whom, a Ghent chooses to entrust or align his personal interests. We decline to posit the determination of an attorney’s professional competence on the nebulous contingency of his alleged knowledge of the proposed agent or alleged failure to dispense his subjective opinion regarding the principal’s choice. A mentally competent principal has the superior knowledge and ability to choose an agent that best meets her expectations, needs, and desires. The responsibility to make such a decision cannot be conveniently denied and the burden shifted because the principal made a poor choice. Therefore, as a matter of law, defendant did not have a legal duty to prevent Fuite from designating the agent of her choice and the trial court properly dismissed this claim. See MCR 2.116(C)(8).
Next, plaintiff argues that defendant committed legal malpractice by permitting Fuite to execute the power of attorney because she was allegedly mentally incompetent at the time of its execution. We disagree. Plaintiff has failed to set forth, and we have failed to locate, law from this or any other jurisdiction that supports plaintiff’s claim on the asserted theory. Nev ertheless, in this case, we find plaintiffs argument without merit.
Although plaintiff attempts to transform this issue into an adjudication of Fuite’s competency at the time the power of attorney was executed, our focus is limited, by the claim raised, to defendant’s actions with regard to Fuite’s execution of the document. An attorney has a duty to act as an attorney of ordinary learning, judgment, or skill under the circumstances using reasonable professional judgment. See Simko, supra at 659. Although that duty conceivably applies to the execution of legal documents, an attorney cannot justifiably be deemed an insurer of a client’s mental competency.
In this case, defendant made reasonable inquiry into Fuite’s understanding of the nature and legal effect of the power of attorney that she requested before its execution. Although Fuite was subsequently adjudicated incompetent, at the time she executed the power of attorney defendant exercised reasonable professional judgment with regard to its execution. Further, even if defendant was mistaken, “mere errors in judgment by a lawyer are generally not grounds for a malpractice action.” Id. at 658. This is not a case where defendant had actual knowledge that Fuite was incompetent. Similarly, the record fails to reveal overt or unmistakable signs of incompetency, or other extraordinary circumstances that would reasonably lead defendant to conclude that Fuite was incapable of understanding the nature and consequences of her actions. Therefore, although the trial court dismissed this claim on different grounds, the claim was properly dismissed. See MCR 2.116(C)(10); Samuel D Begola Services, Inc v Wild Bros, 210 Mich App 636, 640; 534 NW2d 217 (1995).
Finally, plaintiff argues that defendant breached an implied contract to notify Fuite’s prior attorney of the changes in her estate plan. This claim was not raised before and addressed by the trial court; therefore, it is not preserved for appellate review. Fast Air, Inc v Knight, 235 Mich App 541, 549; 599 NW2d 489 (1999). Further, after review of the ambiguous conversation on which the claim is predicated, we conclude that plaintiffs argument is without merit.
Affirmed.
A principal may not be capable of exerting control over an agent who is operating under a properly executed durable power of attorney if the principal becomes incapacitated at some time following its execution.
Although plaintiff attempts to raise several other issues in the brief on appeal, including apparently a conflict of interest claim, our review is limited to the issues raised in the statement of questions presented. See MCR 7.212(C)(5); Bouverette v Westinghouse Electric Corp, 245 Mich App 391, 404; 628 NW2d 86 (2001). | [
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Per Curiam.
The bill in this case was filed to set aside a deed made by the defendant school district to the defendant the Conference of the Church of God; the complainant claiming title to the premises by virtue of a contract entered into between certain trustees and the defendant school district. The entire property is worth about $250.
The question is one of fact. It involves no legal principle or question of interest or benefit to the profession. The learned circuit judge filed a written opinion, holding that the complainant is entitled to the specific performance of the contract between it and the defendant school district, and that the deed made by the defendant school district to the defendant the Conference of the Church of God is void. We are of the opinion that he reached the correct, equitable, and just conclusion.
The decree is affirmed, with costs.
Long, J., did not sit. | [
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] |
Moore, J.
The complainant, holding as collateral an assignment of stock of C. H. Meday in the defendant corporation, filed this bill to enjoin the defendant from selling that stock to enforce an alleged lien of its own for indebtedness of Mr. Meday. The circuit judge dismissed the bill of complaint, and the case is brought here by appeal.
Defendant is a corporation under the general manufacturing act. Its proceedings to enforce its lien were regular in form. The dispute is upon the existence of the debt for which the defendant’s lien is claimed. It turns mainly upon the effect of certain payments of money made by defendant to Mr. Meday, and of the giving of certain notes by him for the amount so received. For many years before December, 1895, Mr. Meday had been the superintendent of the Detroit packing houses of Hammond, Standish & Co., on a salary of $3,500 per year. The Hammond family held a majority of the stock in the company. One of them (George H. Hammond) was president, and his brother Charles F. was a director. In November, 1895, George H. Hammond expressed to Mr. Meday a wish for his resignation, because he himself wanted to be more active in the business, and have entire control and supervision. Soon after a verbal agreement was made between the two Hammonds and Mr. Meday, pursuant to which Mr. Meday tendered his resignation, to take effect December 1st, and sent the secretary of the company a letter stating the terms of the agreement consequent upon his retirement from the superintendency, so far as concerned the company, to be (1) his retention on the board of directors while he remained a stockholder; (2) that he was to receive $3,000 yearly, payable at the office of Hammond, Standish. & Co.; (3) future dividends on his stock up to that amount to be remitted to Hammond, Standish & Co.; (4) the agreement to be annulled by death. At a directors’ meeting held 10 days later, the following resolution was introduced by G. H. Hammond, and carried:
“ That Mr. C. H. Meday be paid a salary at the rate of §3,000 per annum, payable in monthly installments, for the year ending the 1st day of November, 1896, in consideration of which Mr. Meday’s services are to be subject to the call of the company on reasonable notice, and any dividends on stock standing’ in his name are to revert to the company to the amount of salary paid, namely $3,000. Should the dividends declared exceed the amount of $3,000, the excess to be paid to Mr. Meday.”
Mr. Meday held himself in readiness to respond to the company’s call for his services, leaving his address with some one in the office whenever he went out of town, so that he might be summoned if necessary. This continued during 1897. He was not called on for service. He drew the money monthly, beginning in December, 1895. '
On January 19, 1897, a directors’ meeting was held, at which Mr. Meday was present until requested to retire, that his own matter might be considered. After he was gone, the following resolution passed :
“On motion, duly made and seconded, it was voted that the company continue to advance Mr. Meday the sum of $250 per month until November 1, 1897, providing the proper arrangements can be made with him securing same, together with the amount advanced him last year, by an assignment from him of any dividends that may be declared on stock in the company now standing in his name.”
At the time of the original resolution of December, 1895, the company was prosperous, and it was expected it would pay dividends. No dividends were declared after 1895 until March, 1899,
Some time after the meeting of January 19, 1897, at which the second resolution was passed, Mr. Standish sent for Mr. Meday, and had a conversation with him, in which he read to him what purported to be a copy of the resolution passed at the January meeting; stating that the resolution required Meday to give his notes for the moneys drawn, including those already drawn. At the time of this interview Mr. Meday had received from the company $3,500. He then executed five notes, at the request of Mr. Standish, aggregating $3,500, and dated, respectively, February 1, May 1, August 1, and November 1, 1896, and February 1, 1897. He also gave a dividend order, authorizing Mr. Standish, as treasurer, to apply all dividends that might be made on his stock towards the payment of his notes, until same are paid in full. Mr. Standish. after-wards sent him, as a copy of the resolution of January 19th, the following:
“Voted, that the company continue to advance to Mr. C. H. Medajr the sum of $250 per month until November 1, 1897, taking his notes for said amounts, and for the amounts advanced him during the year which ended November 1, 1896, with his order to the treasurer of the company to apply dividends on 1,232 shares of stock standing in his name until said notes be paid in full.”
Mr. Meday afterwards drew $250 a month in March, April, and May, 1897, giving notes therefor, which, with the five already given, are those representing the amount in controversy. Further sums were drawn and notes given therefor at later dates, but these have been retired by payment out of dividends, and are not in question. At the time the notes were given, Mr. Standish testified, Mr. Meday said:
“Why, Mr. Standish, there is no question about this. I am not a pensioner. I do not want any gratuities or anything of that kind; I expect to pay this all back.”
Mr. Meday does not deny this. No demand of payment of the notes was ever made on Mr. Meday, and no attempt was made to collect them until the defendant gave notice of sale to enforce its lien in June, 1900.
The record indicates that Mr. Standish gave Mr. Me-day to understand when the notes were given that the resolution of January 19th made his receiving further moneys conditional upon his giving the company his notes for all moneys, including what he had already received under the former resolution, as well as an order for the application of dividends in payment' thereof, and that he afterwards sent him, as a copy of the resolution, one making those conditions. Mr. Standish explains the matter by saying that, at the meeting of January 19th, two or three forms of resolutions were drawn, and the board adopted the first one which recommended itself, — the form which did not provide for the notes. The memoranda of these resolutions he carried on blocks of pencil paper in an envelope, and by an error the draft of the resolution mentioning the notes got into the minutes of a meeting held on March 12th, and the copy of it sent Mr. Meday was prepared without any intent to deceive him.
The question involved is one of fact. The testimony is not clear, and the solution of the question is a difficult one. If the proposition of Mr. Meday to the company, and the resolution of December, 1895, and the payment of the $3,000 thereunder, were all there was of the transaction, it would not be so difficult; but that was not the end of the transaction. It is apparent that, when that resolution was adopted, it was expected the business of the company would be so profitable there would be dividends upon the stock owned by Mr. Meday, which might exceed the amount which was paid to him; and, in case they did, the excess was to be paid to him, otherwise to the company. It is apparent the $3,000 was not to be paid for services alone. The expectation of Mr. Meday and the company as to dividends was not met. Subsequently advances were made to Mr. Meday under the circumstances before stated. It does not appear that he objected to giving his notes, or that he made any claim at that time that the money he received was simply a payment of salary, or, if it was not, it was to be paid, if paid at all, out of the dividends earned during the year in which it was paid. On the contrary, all the parties seem to have treated the ad vanees made as a debt which Mr. Meday ultimately expected to pay, and for which he was willing to give his notes. In fact, not only the notes involved here were given, but, when later advances were made to him, he gave other notes, which have been retired by applying upon them subsequent dividends. It is not questioned that, if Mr. Meday owed the defendant, it had a lien upon the stock, which might be enforced under the provisions of section 7052, 2 Comp. Laws.
The decree is affirmed, with costs.
Hooker, C. J., Grant and Montgomery, JJ., concurred. Long, J., did not sit. | [
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] |
Montgomery, J.
The respondent was convicted of having carnal intercourse with a female under the age of 16 years, and brings the case here for review upon a single question. It is contended that there is no sufficient proof of penetration. The rule is laid down in 1 McClain, Cr. Law, § 450, that no particular form of words on the part of the prosecuting witness is necessary in testifying to the fact of penetration; that her statement that the defendant had full connection or sexual intercourse with her is sufficient, if the jury therefrom believe that the penetration was effected. The complaining witness in the present case testified that the respondent had sexual intercourse with her. There was also testimony of a physician, who made an examination of the parts, and found that the hymen had been ruptured, and a relaxed condition of the vagina. He also testified that frequent sexual intercourse with an adult male would cause the condition which he found.
We think the rule stated in McClain on Criminal Law is reasonable. It is true, the fact of penetration must be proved, although any penetration, however slight, is sufficient. But it may be proved, as any other fact is proved, by circumstantial evidence, or by one who witnessed the act, but who is unable to testify in terms to the actual fact of penetration. See Brauer v. State, 25 Wis. 413. The testimony of the physician, showing the condition of the parts, is an important piece of evidence as bearing upon the question of fact. See Brauer v. State, supra, and cases cited.
The conviction will be affirmed.
Hooker, C. J., Moore and Grant JJ., concurred. Long, J., did not sit. | [
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Moore, J.
The record bears out the following statement of facts, taken from the brief of the petitioner for writ of assistance:
On the 19th of August, A. D. 1899, a decree of foreclosure and sale was rendered by the circuit court for the county of Ottawa, in chancery, in the above-entitled cause. In pursuance thereof, said foreclosure sale was advertised by the commissioner in a notice signed by said commissioner, and countersigned by “Turner & ■ Turner, Solicitors,” and a sale of said premises was made by said commissioner on the 24th of July, 1900, to Gerald' Fitzgerald, for the sum of $1,500, as the highest bidder, and a commissioner’s deed given in pursuance thereof; and on July 24, 1900, said commissioner paid to Turner & Turner, solicitors for Adam Lachman and Henry Lachman, and who assumed to act as “complainant’s solicitors,” the sum of $52.34, taxed costs of suit, and $1,353.26, amount to be due, and took their receipts therefor, and filed his report of such sale with the register of the court. On the 25th day of July, 1900, the usual order of confirmation of said report and sale was entered by the register of said court, he being authorized so to do by George A. Farr, Esq., the complainant and solicitor of record therein. Notice of the entry of said order was served July 28, 1900, among others, upon said Turner & Turner, solicitors for Adam Lachman and Henry Lachman, two of the defendants in said suit, and the only appellants herein, and the same was received by said Turner & Turner on the 28th day of July, 1900; and no order of substitution of said Turner & Turner as solicitors for complainant in the place of said George A. Farr had then or has ever been entered herein.
That upon receipt of the same, and on July 31, 1900, said defendant and appellant Adam Lachman, by his solicitors, Turner & Turner, filed in said circuit court a petition setting up the rendition of said decree; the assignment of the same by said complainant, Farr, to said defendant Adam Lachman; the advertisement and sale of said premises by the commissioner “at the instigation of said Adam Lachman,” and the bidding off of the same to said Fitzgerald; the execution of said deed, and the fil ing of the commissioner’s report of said sale; the notice of entry of order of confirmation, and the receipt of notice thereof; and praying, among other things, to set aside said sale, and that the same be not confirmed, or for the amendment of said decree nunc pro tunc to provide for an indorsement upon said commissioner’s deed for six months’ redemption from said sale; praying also to have said petition “stand as exceptions to the confirmation of said sale aforesaid; that the order sought to be entered confirming said sale was not authorized by the real complainant in this cause, the said Adam Lachman, or his solicitors;” and that said Turner & Turner ‘ ‘ be substituted as solicitors of record for the complainant in said cause and further praying “that a decree be entered providing for redemption according to the terms of Act No. 200, Pub. Acts 1899.”
Said petition was heard before the judge of said court, and Jerome Turner, Esq., one of the solicitors of said Adam and Henry Lachman, appellants, appeared, and “ in open court waived all objections to said sale and the prayer of said petition, except the prayer asking that said deed might be made and stand subject to six months’ redemption.” The prayer of said petition was denied. Afterwards an order to show cause why said petition should not be granted, and the order denying same be set aside, was issued by this court upon petition of said Adam Lachman, and answer was made thereto by said circuit judge, and the writ of mandamus prayed for was denied by this court, and said sale held to be absolute and without redemption. See Lachman v. Ottawa Circuit Judge, 125 Mich. 27 (83 N. W. 1025). It appeared before the circuit court upon the hearing of the said petition, and also in this court in said mandamus proceeding upon the face of said petition, that the foreclosure decree was assigned by George A. Earr on the 30th of August, 1899, to Adam Lachman, and that the sale had been made “at the instigation of said Adam Lachman” and his solicitors. This was the first time that the assignment of the decree had been brought to the notice of the court.
On March 27, 1901, Gerald Fitzgerald, purchaser at said foreclosure sale, and his wife, conveyed the premises to the appellee, John H. Tatem. It appears, further, that September 17, 1900, a sheriff’s deed of the title of Henry Lachman was made to Grant E. Miller, which deed was based on a judgment in favor of Miller and against Lachman, rendered by the circuit court in said county of Ottawa. Miller deeded to the appellee-, J. H. Tatem. Due service of a certified copy of the order confirming said sale, and also of the circuit court commissioner’s deed to said Fitzgerald made upon said sale, was had upon said defendant Henry Lachman and one Andrew Lester, who were or claimed to be in possession of the premises, and personal demand for possession thereof made upon each of them, and each of them refused to comply therewith.
Upon the filing of applicant’s petition for a writ of assistance in the circuit court, and service of order to show cause issued thereon, the defendants and appellants, Henry Lachman and Adam Lachman, filed an answer and cross-petition thereto by Turner & Turner, their solicitors. In effect, said answer admitted all of the allegations of said petition, and the foregoing facts, except that it is therein claimed that the foreclosure sale of said premises made by said commissioner “was a mere sham, was not regular', and was void,” and that the order entered confirming the report and sale of said commissioner “was merely a sham, and not of any binding force whatever, and was entered without the authority of Adam Lachman or his solicitors,” and it “denies that said sale now stands in all respects confirmed and absolute for the reasons hereinafter set- forth. ” Said Henry Lachman further denied that his right, title, and interest to said premises, and his right of possession, were extinguished by said foreclosure sale and deed. The defendants joined to said answer a cross-petition setting up, in substance, that on April 29, 1897, said defendant Henry Lachman was the owner in fee of the said premises, and then executed a mortgage to said Farr thereon, to foreclose which said Farr filed a bill in said court on May 24, 1899, and on August 19, 1899, a decree of foreclosure was rendered thereon, and that on the 30th of August, 1899, said decree was duly assigned in writing, for a valuable consideration, by said Farr to said Adam Lachman, “who was a nominal defendant in said cause by reason of other mortgages that he held upon the same land and property;” “that by reason of said assignment, under and by virtue of Rule 34 of the Chancery Rules of this court, said petitioner Adam Lachman became transferee or assignee of said foreclosure decree, and could not proceed to a sale of the mortgaged premises without presenting a petition to the court setting forth the assignment, and asking for a sale under the decree as transferee or assignee, for, under the rules of the court and the" decisions in this State, a sale made without such a petition would be absolutely void.” It further avers that some time in the month of June, 1900, the said petitioner Adam Lachman, by his solicitors, Turner & Turner, directed the circuit court commissioner “to publish, advertise, and sell this said land by virtue of the terms of said decree,” and sets forth that said sale was made to said Fitzgerald and commissioner’s deed executed as aforesaid. Said Henry Lachman alleges that said sale and deed were void for the reasons aforesaid. Said cross-petition further recites the entry of said order of confirmation by consent of said Farr, but “without the order or consent” of the solicitors of said Adam Lachman, “the real complainant,” and that said order was not legal, and that afterwards said Adam Lachman petitioned said court for the setting aside of said sale. It avers that said Adam Lachman is ready and willing to pay said Fitzgerald the money received upon said sale, and prays that “ said order confirming said sale be set aside,” and that said Adam Lachman be substituted “as transferee and complainant in said cause,” and for general relief. No actual payment or tender of money received for the said foreclosure sale has ever been made into court or otherwise.
The applicant objected to the entertainment of said cross-petition, and moved to dismiss the same. A hearing was had upon said ¿notion, and some proofs taken thereon. Thereupon the court dismissed the ci’oss-petition, and, after a full hearing upon the petition of said applicant, the court ordered said writ of assistance to be issued by the clerk of said court in behalf of said applicant, John H. Tatem. Said writ was issued accordingly.
Counsel for appellants make two claims:
“1. That the order entered in this cause confirming the sale made was void, for the reason that it was entered without any authority from the real complainant or assignee or his solicitors.
“2. That the circuit judge erred in not allowing us to introduce proof under our cross-petition, filed at the time this petition was heard, and in not setting aside said sale for the reasons therein given.” ’
There are several reasons why the action of the circuit judge should be sustained:
First. Because after Mr. Fitzgerald purchased the land, upon a hearing in which Mr. Lachman asked to have the sale set aside, the solicitor for Mr. Lachman, with full knowledge of how the sale had been made, in open court—
“Waived all claim of relief except that prayed for as follows: ‘ That a decree be entered providing for redemption according to the terms of Act No. 200, Pub. Acts 1899, and for any further or different relief in the premises that shall be according to equity and good conscience;’ and the specific relief asked for was an order of court providing for six months’ redemption under said sale, and that the indorsement of the circuit court commissioner upon the deed be allowed to stand.”
This court held the claim could not be sustained. Lachman v. Ottawa Circuit Judge, 125 Mich. 27 (83 N. W. 1025). Mr. Tatem is the grantee of Mr. Fitzgerald, and the case is res adjudicata.
Second. After a decree was obtained by Mr. Farr, it was assigned by him to Mr. Lachman, and, without call ing the attention of the court to this assignment, Mr. Lachman caused the land to be sold under the decree, the same as though no assignment had been made. No notice was given to the bidders at the sale of any irregularity, and Mr. Lachman was himself a bidder. In Bigelow v. Booth, 39 Mich. 622, it is said:
“Whatever the effect of the assignment of the note and mortgage by the mortgagee and complainant, after he had commenced proceedings for the foreclosure of his mortgage, might have been if brought to the attention of the court, it is sufficient to say that until known they could have no effect whatever. Although known to the parties, yet the assignment did not appear of record, and was not brought to the knowledge of the court. The case proceeded regularly to a decree, sale, and confirmation of the same, and the effect of such, assignment is sought to be used in this case for .the first time. It cannot be so used. The decree made and sale thereunder were valid, and cannot thus collaterally be attacked. Were it otherwise, rights acquired by parties under judicial sales could never be safe from attack.”
Mr. Adam Lachman not only allowed the sale to proceed, but he received and retained the proceeds of the sale, and still has them. For these reasons he is estopped from questioning the regularity of the sale. Wilber v. Goodrich, 34 Mich. 84, and the many cases cited in the note; 2 Herm. Estop. §§ 1059-1069, 1189-1191, 1194, 1199.
Mr. Henry Lachman’s interest in the property was cut off by the sheriff’s deed.
The case is affirmed.
Hooker, C. J., Grant and Montgomery, JJ., concurred. Long, J., did not sit. | [
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Hooker, C. J.
An information was filed against one Goodrode charging him with a violation of what is known as the “Local Option Law,” as amended by Act No. 183 of the Public Acts of 1899. The following is a copy,of the substance of the information:
“He, the said Jesse E. Goodrode, being then and there a druggist, whose business consisted in part in the sale of drugs and medicines, did then and there sell, furnish, and deliver a certain quantity of malt, brewed, fermented, and intoxicating liquors, to wit, one bottle of beer, to one George Lannin, the aforesaid malt, brewed, fermented, and intoxicating liquor, to wit, said one bottle of beer, so sold, furnished, and delivered by the said Jesse E. Goodrode to the said George Lannin at the township of South Haven, and in the county aforesaid, not being then and there sold, furnished, and delivered under and in compliance with the requirements and restrictions imposed upon druggists and registered pharmacists by the general laws of the State of Michigan, but said malt, brewed, fermented, and intoxicating liquor, to wit, said one bottle of beer, then and there so sold, furnished, and delivered by the said Jesse E. Goodrode to the said George Lannin, being then and there so sold, furnished, and delivered contrary to the provisions of a certain resolution adopted by the board of supervisors of the county of Van Burén, State of Michigan, on the 4th day of March, A. D. 1890, in pursuance of the provisions of Act No. 207 of the Public Acts of the State of Michigan for the year 1889, the aforesaid selling, furnishing, and delivering of said malt, brewed, fermented, and intoxicating liquor having been then and there done as aforesaid by the said Jesse E. Goodrode in violation of and contrary to the provisions of said Act No. 207 of the Public Acts of the State of Michigan for the Year 1889 and the acts amendatory thereto, and contrary to the form,” etc.
Upon arraignment a motion was made on the defendant’s behalf that the information be quashed on the ground that it charged no offense within the language of section 5381 of the Compiled Laws of 1897, and this motion was granted. A refusal by the circuit judge to vacate this order was followed by this application to compel such action, and a trial of the case.
The only question involved is whether it was sufficient to charge, in the language of the act of 1899, “that the sale was not made under and in compliance with the general laws of the State of Michigan.” It is claimed that the defendant had a legal right to be informed of the nature of the violation, that he might know how to prepare for his defense. It is truly said that under 2 Comp. Laws, § 5381, many sales by druggists are prohibited, — such as sales' to minors, to intoxicated adults, to one having the habit of getting intoxicated, to Indians, to persons of Indian descent, against the prohibition of a written notice, to be used as a beverage, to be drank upon the premises, sold mixed with any beverage drawn from a soda fduntain. . Again, it is an offense to sell without recording, and, under section 25, to sell without sending a list of sales weekly to the prosecuting attorney. It is manifest that the information in question fails to give any inkling of the nature of the violation, and the defendant must come prepared to negative any claim that may be made under the general statement that his sale was not in compliance with law.
The writ will be denied.
" Moore, Grant, and Montgomery, JJ. concurred. Long, J., did not sit. | [
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] |
Hooker, C. J.
The plaintiff recovered a judgment against the defendant for injuries received by falling upon its sidewalk. She claims to have been tripped by a loose board, one end of which flew up when her husband stepped upon the other end. It is claimed that the declaration, as originally filed, alleged that she fell over a loose-plank upon the walk, and the point was made that this was not a sufficient allegation that it was a part of the walk to sustain a verdict. The court permitted an amendment and refused a continuance. Error is assigned upon this. We are satisfied that the declaration needed no amendment, and it was not error for the court to permit an amendment to save a possible question.
The testimony was not clear as to the exact point where the accident occurred, and there was proof admitted tending to show that there were several planks loose at the time, and that when the walk was taken up, a little later, a number of the stringers were rotten, and would not hold nails. There was also testimony tending to show that the walk was old, and had been recently repaired. It is claimed by defendant’s counsel that the walk was repaired on the 23d of May, and that there was no proof offered to show that there were defects after May 23d until the day of the accident, i. e., May 29th. The testimony shows, and it is uncontradicted, that the walk was repaired on May 23d; and there is no clear testimony that there were any loose boards after that until this accident happened, or, at any rate, until the Sunday morning previous to the evening when it occurred. Unless there is something in the testimony to indicate that this repairing was not properly done, the city could not be said to have notice that the defect existed. The plaintiff offered testimony tending to show that the walk was old, and that the stringers were rotten, and in places would not hold nails, and that the repairs made did not include new stringers, and claimed that the city, with notice of these conditions, failed to put the' walk in a condition that could be called safe. We are of the opinion that it was proper to leave this question to the jury. If the walk was so notoriously old and rotten that the city should have known that nails would not hold, it was incumbent upon it to make repairs sufficiently substantial in character to justify them in believing that it was reasonably safe. It was proper to receive evidence that upon taking up the walk, soon after the accident, the stringers were badly decayed, as it tended to show the actual condition. Whether the actual condition as thus shown tended to prove notice or not, is another question. Standing alone, it might not; but, taken in connection with an attempt to repair, it might, for one driving nails into rotten wood might ascertain that it was rotten, and one supplying new boards, or even replacing old ones, would have an opportunity to see the stringers, and learn something of their condition and the general character of the walk.
It is urged that the testimony should' have been limited to the particular defect, and that it was not competent to prove the condition of the walk in other places.' This is true, unless there is a fair presumption, arising from the condition elsewhere, that the particular defect existed. When a strip of wooden walk is put down at one time, of uniform material, it is not unreasonable to suppose that it will wear out and go to decay with some degree of uniformity. Hence those facts may be shown, and the general condition of such a piece of walk may become important evidence. In this case the exact board which caused the accident was unknown. If it appeared that the walk was old and several boards were loose, it tended to show a necessity for repair, which, if sufficiently long continued, might be accepted by the jury as evidence justifying the inference of knowledge on the part of the authorities.
Error is assigned upon some rulings whereby witnesses for the defendant were asked to express an opinion as to the condition of the walk. The court attempted to exclude their opinions as to the safety of the walk, as trenching upon the province of the jury, and apparently designed to admit the testimony so far as it tended to show the true condition of the walk. We think the defendant was not injured by these rulings. The testimony of the witnesses admitted fairly covered the ground.
We think it unnecessary to discuss other questions, further than to say we find no error in the charge.
The judgment is affirmed.
Moore, Grant, and Montgomery, JJ., concurred. Long,. J., did not sit. | [
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] |
Hooker, C. J.
The claimant, Mrs. Mack, presented a claim against the estate of her mother, Sarah C. Cole. It consisted of a promissory note for $600, purporting to have 'been signed by the deceased, the claimant being named as payee. It was dated April 2, 1895. The claim was disallowed, but on appeal the jury found for the claimant, and the case has been brought to this court by the defendant.
After claimant had made her prima facie case, the defendant, while admitting the signature of the deceased, claimed that the note .was written over her signature, and was a forgery. Counsel also sought to show that the claimant had, for some years previous to April, 1895, lived with .the deceased under an arrangement to care for her, in consideration of certain deeds of property theretofore given to her; that about April 1, 1895, a violent personal encounter occurred between them, which resulted in her going away, and that a few months later a suit was commenced in chancery by the deceased to set aside these deeds; that, upon the hearing, testimony was introduced showing many items of labor and expense incurred by claimant in relation to the previous contract, all of which were taken into consideration by the trial judge, who rendered a decree which gave to this claimant a portion of the property as remuneration for her labor and expense. It was not claimed that the note itself was before that court, but it was claimed that all of the items which went to make up the amount for which the note was given were litigated there.
The questions in the case may be divided into two classes First, those which relate to the question of forgery; second, those growing out of the attempt to prove a former adjudication.
The body of the note was in the handwriting of the claimant, and was in different ink from that used in the signature. There was testimony that there had been seen at the residence of the deceased previous to April, 1895, some blank sheets of foolscap paper with deceased’s signature upon them, and that the existence of the note was unknown to other members of the family until after Mrs. Cole’s death. On the other hand, the claimant’s daughter testified to the circumstances attending the alleged execution of the note, and explained the use of two kinds of ink.
It was proper that the witness Carpenter should be denied the privilege of stating that deceased had no opportunity to sign the note upon April 2, 1895. If it was true, she could state the facts which would show that there was no opportunity, and this the judge held that she might do. His course was vindicated by the subsequent testimony, which showed that she was not in a situation to know that no such opportunity occurred.
One Stevenson testified that he had a talk with claimant about this note soon after her mother died, and that she told him that she had “ Ma’s note,” and that she supposed lie knew about it, and inquired if be did not, and he told her “ No.” The court struck out this testimony, and error is assigned. We think this testimony was competent.
Counsel offered in evidence the files and records in the chancery case for the purpose of showing a former adjudication. The court held that they were admissible only so far as they related to this note. Now, the note was not mentioned in the pleadings or testimony in that case, and we understand that the proceedings were ruled out. We are of the opinion that, if the defendant could show by them that the items which made up the consideration for which the note was given were used by way of defense against the intestate’s bill to set aside the deeds, and were made the basis upon which the court made a decree allowing complainant to retain a portion of the lands theretofore deeded to her, it would be a defense to the note, for it would show payment or satisfaction of the debt for which the note was given. Whatever may be said about the pleadings in that case, the testimony shows that claimant asserted a right under the deeds by reason of a part performance of her contract, and brought in some evidence regarding the items. It does not appear that she then claimed to have a note, or omitted any items. The finding of the judge contains the following statement, viz.:
. “ It is clearly established on both sides that defendant has paid enough by actual work and money to own and deserve the Beech property, and her title to it will not be disturbed, but confirmed. It is equally clear that the Dearborn property cannot be paid for by defendant in the care and attention such as complainant expected. * * * A decree will be granted for complainant as to one-half of the Dearborn 16£ acres, being the portion on which the dwelling house is located, and that defendant deed the same back to complainant, to enable complainant to raise money, if need be, to be cared for therefrom, and to enjoy the income of the entire acreage during complainant’s lifetime; the Beech property to belong to defendant.”
It was evident that the court was of the opinion that the land more than paid the daughter for her labor and financial aid to the mother, and therefore compelled her to reconvey a portion of the premises. It is equally clear that he allowed'her to retain some of the land only because of such labor and aid. Whether the items that had gone to make up this note were included or not is a question of fact. The pleading does not expressly show it, but it is .claimed that the testimony taken in the chancery case shows that they were considered, and it may be argued that there is a strong presumption from the entire record that they were all included. This record was competent testimony upon the question, which should have been submitted to the jury if the evidence was- not so conclusive as to justify a decision of that question by the court.
The claimant was a witness in the chancery case, and was examined at length in relation to the transactions between her mother and herself on and after April 1, 1895. The defendant claims that this testimony was admissible as bearing upon the probability of the execution of the note. We think defendant is right about this. It is claimed, however, that the execution of the note was admitted-on the trial; but the admission is qualified, and, in view of the proofs offered and contention made, could hardly have been considered an admission of more than the genuineness of the signature.
There are other assignments of error, but many of them are not based on exceptions, and others need not be discussed, as they are not likely to affect another trial. We think the alleged books of account of Mrs. Cole were not admissible under the preliminary proof offered regarding them.
For the reasons stated, we feel constrained to reverse the order of the circuit court, with costs, and remand the cause for a new trial.
Moore, Grant, and Montgomery, JJ., concurred. Long, J., did not sit. | [
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Moore, J.
The bill of complaint in this cause was filed for the purpose of obtaining a decree canceling and declaring void a certain mortgage executed by complainant to defendant July 10, 1900, at Dawson, Yukon territory, on lands situate in Berrien county. The bill alleges that the mortgage was obtained by fraud, conspiracy, duress, and was without consideration. It is alleged that in the latter part of May, 1900, the complainant went to Dawson, in the territory of Yukon, and there met one Frank Phiscator, who had formerly lived in Berrien county; that complainant had a just cause of action for damages against Phiscator. Upon meeting Phiscator at Dawson, the complainant and Phiscator entered into negotiations, the result of which was an agreement by Phiscator to pay complainant $7,000 in consideration of a release of all claims against him by complainant, and upon condition that complainant at once leave the Klondike region. On the 26th of May, 1900, Phiscator paid complainant $7,000, and on the same day the money was placed in a bag, and committed to the charge of the purser of a steamboat, upon which complainant had engaged passage for the purpose of returning to the United States. A few minutes after this, complainant was arrested by officers of the Yukon territory upon the charge of robbery, preferred by Phiscator, and lodged in jail at Dawson. Complainant thereupon inquired for an attorney, and employed the defendant to defend him. Complainant then had $200 with him, which Pattullo exacted, and which complainant paid him. Pattullo informed complainant that there was no case against him. Two days after his arrest, an ex amination was had before a justice, and complainant was bound over to appear at the territorial court on June 16, 3 900. Pattullo did not appear before the court on the day assigned, although complainant sent for him. Complainant pleaded not guilty to the complaint, it having been amended to a charge of unlawfully obtaining money by menaces. The case was then adjourned to September 17, 1900. The complainant then became suspicious of Pattullo, and insisted upon having another attorney; and another attorney (Mr. White) was thereafter employed to act with defendant as assistant counsel. On the 8th day of July, 1900, while complainant was in jail, the defendant and White came to the jail, and informed him that they could obtain his release from imprisonment, and his liberty, upon the following conditions: (1) That complainant must plead guilty to the charge against him; (2) pay to defendant $200 in cash, complainant having already paid him and White $500; (3) sign a written statement of retraction, reciting that Phiscator had never wronged him, that his accusation against Phiscator was false, and that complainant had threatened Phiscator’s life to compel him to give complainant $7,000; (4) complainant must execute a mortgage upon his farm in Berrien county, Mich., conditioned to pay Pattullo $800 more for attorney’s fees; (5) complainant must assign and pay back to Phiscator the $7,000.
The bill alleges that the complainant, having then been in jail 44 days, and being anxious to regain his liberty at any expense, and unable to obtain bail, and in a state of mind in which he could be induced to agree to anything in order to obtain his liberty, consented to the conditions required, did execute the mortgage heretofore described, signed the recantation, caused the $7,000 to be paid back to Phiscator, and went into court and pleaded guilty to the charge against him. Complainant thereupon left the territory, and returned to the United States. The bill further alleges that complainant paid to the defendant $700 in cash while he was in jail at Dawson; that this was more than the services of him and White were reasonably worth; that a charge of $1,500 is unreasonable and extortionate; and that the mortgage was not his free act and deed, but was procured through undue influence, and taking advantage of his fears and feeble condition while in imprisonment. The bill further charges that the defendant was in league-with Phiscator for the purpose of defrauding him and extorting an unreasonable fee. The bill concludes with a prayer for a decree cancélíng the mortgage.
The answer admits the execution of the mortgage described in the bill of complaint; that the complainant signed the writing of recantation referred to, agreed to-plead guilty to the charge against him, and that he did plead guilty thereto; that he paid back or caused to be paid back to Phiscator the said sum of $7,000; and that these acts and agreements on complainant’s part were done and entered into as a condition of being released from prison on a suspended sentence, on complainant agreeing to leave the territory. The answer alleges, however, that these acts were done in consequence of the voluntary offer-on complainant’s part, and not on account of any inducement held out or restraint imposed on complainant by defendant, White, or anybody else. The answer further alleges that the services of defendant and White were reasonably worth $1,500; that complainant voluntarily offered to pay defendant $1,000 if he would obtain his release from jail; and that, on the employment of White, it was agreed by complainant to pay the further sum of $500 for attorney’s services. It is further alleged that complainant himself suggested the giving of a mortgage to secure the payment of the services of defendant and White. The answer then gives a version of what occurred in court. The answer further alleges that defendant was involved in great labor in his services for the complainant; that the services of himself and Mr. White were reasonably worth $1,500; and that, considering the high prices of everything in Yukon territory, the charge-was in no wise unreasonable.
The testimony of complainant was taken in open court. The testimony on the part of the defendant was taken by deposition. The circuit judge found that the making of the mortgage was as much a condition of complainant’s obtaining release from jail as any other of the requirements ; that it was not the free and voluntary act of complainant; that, as a matter of fact, the services of defendant and White for complainant were not reasonably worth more than $700, and that a fee of $1,500 is grossly excessive and exorbitant; that the mortgage was obtained by the undue influence of an attorney'over a client, while the latter was in jail, and in a desperate frame of mind; and made a decree in accordance with the prayer of the bill. The case is brought here by appeal.
This is not a litigation between Phiscator and Coveney, in which it is necessary for us to decide whether illicit relations existed between the wife of Coveney and Phiscator, for which, upon the appearance of Coveney in the Klondike, Phiscator, without threats being made to him, was willing to cause $7,000 tobe handed over to Coveney, as the latter claims, or whether Phiscator was the victim of a conspiracy and a scheme to blackmail him, and, as a result of threats made by Coveney to kill him, was induced to part first with $2,500 in Baroda, Mich., before going to the Klondike, and afterwards, for the same reason, caused to be delivered the $7,000 in the Klondike, as claimed by Phiscator. The litigation is between an attorney and client in relation to a contract made between them when the client was under arrest and in jail. The inquiry is whether the contract is so just and reasonable it ought to stand, or whether it is so unjust and unconscionable it ought to be set aside. It is said by counsel for defendant that, if a man is legally imprisoned, and to procure his discharge seals a bond or deed, this is not duress (citing cases), and that an agreement to pay a just debt, made while under legal imprisonment, cannot be avoided on the ground of duress. If it be conceded these are correct statements of the law, they do not meet the proposition presented here. This is not a mortgage running to the person who caused the arrest to be made, and who was seeking to collect a debt, as was the case in Prichard v. Sharp, 51 Mich. 432 (16 N. W. 798), but it is a dealing between attorney and client, which must be characterized by fairness and reasonableness if it is to stand. In 3 Am. & Eng. Enc. Law ( 2d Ed.), p. 433, it is said:
“Contracts for Compensation after Relation Established — Such Contracts Jealously Guarded. An attorney cannot make use of the relation bétween himself and his client to extort from the latter an unjust or unreasonable contract, for compensation, and a court of equity will grant relief from such oppression, and will confine the attorney to a reasonable charge for compensation,” — citing many cases.
See, also, Will. Eq. Jur. (Potter’s Ed.) p. 172; Howell v. Ransom, 11 Paige, 538; Hitchings v. Van Brunt, 38 N. Y. 335.
In Dickinson v. Bradford, 59 Ala. 581 (31 Am. Rep. 23), it is said:
‘' The relation of an attorney to his client is one of trust and confidence, in which influence is of necessity acquired. The law does not incapacitate him from contracting with, or from becoming the recipient of the bounty of, the client. It does, however, command that all his transactions with the client shall be anxiously and jealously scrutinized, that the client maj'' be protected from his own overweening confidence, and from the influence or ascendancy which the relation generates. 1 Story, Eq. Jur. §§ 310-314; 2 White & T. Lead. Gas. Eq. (4th Am. Ed.) 1216. There may be no trace of deceit, or of imposition, or of overreaching advantage, — no mark of actual fraud, which would justify a court in interfering for the rescission, or in refusing to compel performance, if the contract had been made between persons not sustaining a relation in which confidence was reposed and influence acquired. The, court does not interfere, or refuse interference, because there has been deceit, or imposition, or actual fraud, but, independent of such facts and ingredients, upon considerations of public policy, to prevent fraud, an abuse of confidence and influence, and to compel fidelity and unselfishness in the performance of fiduciary duties.
‘ ‘ In this State attorneys and solicitors are entitled to compensation for their services. Before entering on the business of the client, and suffering him to repose in them the trust and confidence of the relation, they may stipulate the measure of their compensation, and, if the client assents, the contract is as valid and as free from objection as any other contract into which he may enter. But if they assume the relation, enter on the duties, thereby inviting confidence and acquiring influence, without expressly stipulating the measure of compensation, no subsequent agreement with the client can be supported, unless it is satisfactorily shown that the compensation does not exceed a fair and just remuneration for the services which have been and which it is the duty of the attorney to render. Lecatt v. Sallee, 3 Port. 115 (29 Am. Dec. 249); McMahan v. Smith, 6 Heisk. 167; Planters’ Bank v. Hornberger, 4 Coldw. 578.
“ Standing, as the parties do, in a relation of confidence, which gives the attorney or solicitor an advantage over the client, the burden of proof lies on the attorney or solicitor; and, to support the contract made while the relation existed, he must show the fairness of the transaction and the adequacy of the consideration. The principle is thus stated by Judge Story:
“ ‘But the burden of establishing its perfect fairness, adequacy, and equity is thrown upon the attorney, upon the general rule that he who bargains in a matter of advantage with a person placing a confidence in him is bound to show that a reasonable use has been made of that confidence, — a rule applying equally to all persons standing in confidential relations with each other.’ 1 Story, Eq. Jur. § 311.”
See, also, Brock v. Barnes, 40 Barb. 529; Merryman v. Euler, 59 Md. 588 (43 Am. Rep. 564).
With these principles of law in mind, it is well to recall certain facts which are established beyond any question. On May 26th, very soon after the $7,000 was delivered to him, Coveney was arrested thousands of miles from home, among strangers, and put in prison, where he was kept for most of the time in a cell where the conditions were very unpleasant. He sent for and retained Pattullo, paying him $200. On the 28th of the same month he was taken before the examining magistrate, but, as Phiscator did not appear, the examination was adjourned for three days. At that time three witnesses were sworn, and Coveney was held for trial at the territorial court. On June 16th he was taken before that court for arraignment. He says he sent for his counsel. Whatever the fact may be as to that, his counsel was not present. He was arraigned, pleaded not guilty, and his case set for trial September* 17th, in the absence of counsel. Complainant says, because of the failure of his counsel to appear when he was arraigned, Mr. White was called into the case. Whether that was the reason or not, Mr. White was in fact brought in, and a further payment was made. July 7th a still further payment was made, making in all $700, which was paid in cash. There is some dispute as to whether the mortgage was signed on the 10th of July, or a day or two earlier; but not later than the 10th of July a mortgage for $800 was given, and on the same day Mr. Coveney, at least with the consent of his counsel, entered a plea of guilty to the complaint lodged against him by Phiscator, made a recantation in writing reciting that his charge against Phiscator was false, and that he obtained the $7,000 through threats and blackmail, and agreed to return to Phiscator the $7,000, and also agreed to leave the country at once. We do not think there is any evidence to connect defendant with the arrest of complainant, or with any conspiracy with Phiscator; but we do think the evidence shows he has been liberally paid for all he did, and that taking the mortgage under the circumstances was unconscionable, and that it ought not to be enforced.
The decree is affirmed, with costs.
Hooker, C. J., and Montgomery, J., concurred. Long and Grant, JJ., did not sit. | [
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Montgomery, J.
This case comes before us on a special finding of facts and law. The plaintiff sues as the assignee of the Superior Drill Company. The defendant received from the Superior Drill Company a number of drills, three of which are in controversy here. The question is whether, under this contract, the defendant became a purchaser of the drills, or was simply the agent of the Superior Drill Company.
The contract is lengthy, but it contained, among other provisions, a clause that:
“All machines sold by second party [defendant] shall be settled for during the season in which they are received,' at net prices herein named. If any machines remain unsold at time of settlement, the first party may require second party to give his note, payable in 12 months, in settlement for the same; or, if first party prefer, said machines shall remain the property of first party, and subject to their order, free of charge.”
The defendant, by other provisions of the contract, agreed to receive the machines on arrival, pay freight, and take proper care of them. The contract' further provided that:
“All machines and proceeds of sales under this contract, whether in notes, cash, or accounts, shall be the property of the first party, held in trust in the hands of the second party; and proceeds of sales, whether in cash or notes, are to be turned in to first party as fast as received by second party.”
A further provision reads:
“ Second party agrees to receive, at any time after date, all the within-named machines that have not been previously ordered out by second party; all additional machines as ordered. Spring sales payable one-half June 1, 1893, one-half October 1, 1893. Fall sales payable one-half October 1, 1893, one-half September 1, 1894. With interest not less than 7 per cent, per annum from June 1st on spring sales and October 1st on fall sales. Final settlement to be made not later than June 1st on spring sales and October 1st on fall sales of current year.”
The evidence shows that these machines came into the hands of defendant, and that the three machines in controversy were on the 28th of February, 1896, in his possession. At that date he wrote to plaintiff a letter, which, among other things, contained the following language:
“Now, one thing more: I want those drillb, three of them, which you claim. I am not going to lose any money on them, as you are trying to make me do so.”
This was in answer to a letter written by plaintiff, as follows:
“Allow me to again call your attention to the account of the Superior Drill Company’s bill, still unsettled, and long past due. You are aware that this account has been turned over to me, and, as I am in need of funds, would kindly, though urgently, request that you adjust this matter without further delay. Should you desire to sell me the goods at present value, I will consider and accommodate you, if possible. You understand, however, drill trade is in worse condition than any other manufacturing of this class, — suffer more, and consequently offer at extremely low price now.”
The circuit judge found that this contract obligated defendant to pay for these drills, and we think this is the proper construction of the contract. It is contended by defendant that the contract simply constituted defendant agent of the Superior Drill Company. It is true that, in a sense, he was an agent of the Superior Drill Company, and that the drill company reserved the title to the property. But such an engagement is not inconsistent with an obligation on the part of the defendant to pay for the drills, and this, we think, he undertook to do by the agreement. Aspinwall Manfg. Co. v. Johnson, 97 Mich. 531 (56 N. W. 932).
It is next urged that the statute - of limitations has run against the claim. The circuit judge found that in the letter of February 28, 1896, which was within six years of the commencement of the action, defendant obligated himself to pay for the machines, and we think this is correct. Up to this time the plaintiff had not demanded a settlement by note. The title to the machines, by the terms of the contract, remained in the plaintiff, and at this date defendant asserted a claim to them, and a desire to retain them, and he could only do so upon paying the contract price.
We find no error in the proceedings, and the judgment will be affirmed.
Hooker, .C. J., Moore and Grant, JJ., concurred.. Long, J., did not sit. | [
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Per Curiam.
Plaintiffs, wife and children of decedent Paul L. Martin, commenced this action in the Genesee County Circuit Court on September 30, 1969. Action was brought to obtain, as against defendant-beneficiary Paul Martin, Sr., father of decedent, the proceeds of a certificate of insurance issued on the life of decedent-insured.
A nonjury trial was held in May 1970. The court, by opinion issued June 2, 1970, determined that defendant had an unrestricted right to the proceeds of the insurance policy in question, in the amount of $7,300. A judgment of no cause for action was entered accordingly on July 13,1970. This appeal followed as a matter of right.
The insurance certificate in question represented decedent’s interest in a group policy of insurance issued by defendant-insurer, Metropolitan Life Insurance Company, to defendant, General Motors Corporation, decedent’s employer. The policy, pursuant to which decedent became insured in October 1961, was in effect at the time of his death, Septem ber 13, 1969, and provided life insurance protection on a contributory basis to eligible employees of defendant corporation, for whom premiums were paid by the corporation.
The record reveals that the beneficiary of insurance form, executed by decedent in 1961 when he applied for the insurance in question, designated defendant father as “Beneficiary”. Testimony of plaintiff wife showed that decedent had designated his father, the defendant herein, as beneficiary so that he would be reimbursed for expenses incurred on decedent’s behalf in the event that something happened to decedent-insured. Other testimony of plaintiffs’ witnesses revealed that defendant had expressed his intention to place the insurance proceeds in a trust for the benefit of plaintiff children. Defendant, testifying upon the trial of this cause, denied, however, that he had at any time mentioned placing the insurance proceeds in a trust; and denied that he had agreed to act as a trustee of the proceeds.
Defendant insurer, on December 23, 1969, filed a complaint of interpleader, pursuant to which it and defendant, General Motors Corporation, were discharged from liability and dismissed as parties; defendant insurer having paid into court the amount of its admitted liability.
Plaintiffs contend that the trial court committed error in finding that a trust in the insurance proceeds in question had not been created by decedent-insured and that the defendant, as named “beneficiary”, was entitled to the unrestricted right to the proceeds thereof. Plaintiffs assert that sufficient parol evidence was presented to establish decedent’s intention of creating a trust in the insurance proceeds in favor of plaintiffs, and that all of the elements of a trust were shown to exist.
It has been held in this state that to establish a parol trust of personalty, the evidence in support of the existence of the trust must be very clear and satisfactory. Harmon v. Harmon (1942), 303 Mich 513, 519. This is especially so where, as here, a considerable period of time has elapsed. 89 CJS, Trusts, § 35, p 761; In re Lane’s Estate (1937), 281 Mich 70. In the instant case, the insurance certificate issued on the life of decedent made no reference to the existence of a trust relationship, but rather contained an outright designation of defendant as beneficiary of the proceeds thereof. Voluntary parol trusts will not be created by the courts, but will only be enforced. See, 89 CJS, Trusts, § 45, pp 786, 787.
This Court, after carefully weighing the evidence in this cause, is of the opinion that the trial court properly determined that a trust had not, by clear and satisfactory proof, been established as having been intended by decedent insured. Nor is this Court able to say that the evidence preponderates contrary to the decision of the trial court. Osius v. Dingell (1965), 375 Mich 605; Masters v. Consumers Power Company (1970), 28 Mich App 67; Parcells v. Burton (1969), 20 Mich App 457. Accordingly, defendant beneficiary would be under a moral duty only to provide for plaintiffs out of the proceeds of the insurance certificate in question.
Affirmed without costs. | [
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Per Curiam.
November 4, 1966, defendant was granted a divorce from plaintiff on his cross-com plaint and lie was awarded custody of his four-year-old daughter. November 19, 1970, plaintiff filed her petition requesting a change of custody from defendant to plaintiff. April 19, 1971, the trial court ordered the requested change of custody and defendant appeals.
The statutory authority to alter the custody provision of a divorce judgment, MCLA § 552.17 (Stat Ann 1957 Rev § 25.97), is properly exercised “on good cause being shown”, Davis v. Davis (1954), 339 Mich 231. The parent seeking the alteration bears the burden of proving a change in circumstances which justifies a change of custody on the basis of the welfare and best interests of the children. Hentz v. Hentz (1963), 371 Mich 335. Codification of this requirement occurred in 1970, PA 1970, No 91, MCLA 1971 Cum Supp § 722.27(c) (Stat Ann 1971 Cum Supp § 25.312[7] [c]).
In its opinion, the trial court stated, “The court believes that the best interests of the child, Heidi Presler, would be served by awarding custody of that child to her mother, Valerie Woodling, at the end of the current school year”, but it found no facts on which this belief was based. Our review of the record discloses no change in circumstances which justifies the change in custody on the basis of the welfare and best interests of the child. Plaintiff failed to meet the required burden of proof.
Any benefit plaintiff might have had under the provisions of MCLA § 722.541 (Stat Ann 1957 Rev § 25.311) no longer exists. That statute was repealed by PA 1970, No 91.
Reversed with costs to defendant. | [
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Moore, J.
This is an action of trespass, the plaintiff declaring against the defendant, “for that the said defendant, on, to wit, the 24=th day of February, A. D. 1900, with force and arms, willfully, maliciously, and unlawfully entered upon the land owned by said plaintiff, * * * said plaintiff then and there being in the lawful possession of said premises, and other injuries then and there did to said plaintiff.” The defendant pleaded the general issue, and gave notice thereunder that where the said injuries are supposed to have been committed was a public highway at the time the said injuries are alleged to have been committed, and that, if acts were done by said defendant as alleged by said plaintiff, they were done by defendant as highway commissioner, in the legal discharge of his said duties in clearing said highway of obstruction. The case was tried by the court without a jury. No request for findings of fact or law was made, and none were made. The court rendered judgment in favor of defendant. The case is brought here by writ of error.
Upon the trial it was stipulated that at one time Benzonia College was the owner of the land where the alleged trespass was committed; that, if plaintiff is entitled to anything, she is entitled to $5 and costs; that the alleged trespass was the cutting of a fence for the purpose of the highway claimed to have been laid out along the side of plaintiff’s land, and that all the cutting was done inside the bounds of what is claimed by defendant to be the highway ; and that the said claimed highway is the same highway over which litigation was had wherein Pauline Bird-sell was complainant and John S. Hayden was defendant in one cause, and Mary Fowles was complainant and John S. Hayden was defendant in another cause. The plaintiff, by this stipulation, did not admit there was any highway there, either by user or by having been laid out.
For the purpose of showing title in plaintiff, a deed was offered in evidence, made by Benzonia College February 10, 1900, to John Fowles and Mary Fowles, his wife, grantees. Mr. Fowles testified the land was bought with money belonging to himself and wife, and that they were in possession at the time of the alleged trespass. At this stage of the case the defendant objected to the reception of any further evidence, and moved to dismiss the case, for the reason that, if any trespass had been committed, it was one against Mary Fowles and John Fowles, for which the wife alone cannot maintain an action; to which the counsel for plaintiff replied:
“We will say that the plaintiff was in possession of the land. The title is in her as much as it is in her husband, and in her husband as much as it is in her. There is no question about that. She was in possession of the premises at that time jointly with her husband. But, where only one of them brings an action of trespass, that one is entitled to only half of the damages. The evidence will disclose that Mr. Fowles himself, perhaps, has no action of damages there; that there was some sort of a proceeding to lay out a road, — a highway, — and that Mr. Fowles, in his own behalf, took an appeal from the action of the commissioner, for himself and himself alone; and that we concede that his rights there were adjudicated. Mr. Fowles himself, in my opinion, is barred from an action against any one trying to open a highway there, — that is, the path-master or such officer, — because he has already tested his right before the authorities in that regard; but ' Mrs. Fowles is entitled to one-half whatever damages was done.
“ The Court: Well, I will allow you to proceed in the meantime.”
Testimony was introduced by the plaintiff showing the cutting of the fence by the defendant. On the part of the defendant it was shown that the question of the legality of the same highway in controversy here was involved in a case before the same judge in the same court where Pauline Birdsell was complainant and John S. Hayden was defendant; that a hearing was had thereon upon pleadings and proofs taken in open court, in which the court decreed the highway was regularly and legally established. Objection was made to the admission of the decree in evidence because not properly pleaded, and also because this plaintiff is not bound by the decree. The decree was received in evidence. The plaintiff then sought to show in rebuttal the proceedings of the commissioner of highways, filed with the township clerk, claiming they would show the highway was not legally established. In reply to an inquiry by the court, it was stated the alleged trespass occurred after the decree in the Birdsell case. The court then excluded the records from the office of the town clerk, and rendered a judgment in favor of defendant.
The first question which calls for consideration is, Can plaintiff maintain this action of trespass, when she and her husband are in possession of the land under a deed running to both of them ? It will be observed, the declaration alleges the title and the possession of the land were both in her. The proofs show they were in her and her husband, who held the land by the entirety. In Speier v. Opfer, 73 Mich. 35 (40 N. W. 909, 2 L. R. A. 345, 16 Am. St. Rep. 556), it is said-:
“ In this case the property to be improved and benefited was held by husband and wife jointly, and not as the separate property of the wife. Only at the death of the husband could the wife claim it as her separate property. During the lives of both, neither has an absolute’inheritáble interest] neither can be said to hold an undivided half. They take by entireties, and at the death of the wife the whole passes at once to the husband. Manwaring v. Powell, 40 Mich. 371; Allen v. Allen, 47 Mich. 74 (10 N. W. 113); AEtna Ins. Co. v. Resh, 40 Mich. 241. Neither has such a separate interest that he or she could sell, incumber, or devise, or which his or her heir could inherit. Vinton v. Beamer, 55 Mich. 559 (22 N. W. 40); Fisher v. Provin, 25 Mich. 347. It is 'an entirety, in which both take the same and inseparable interest. Neither can affect the other’s rights by a separate transfer, and whatever will defeat the interest of one will defeat the other’s. Vinton v. Beamer, supra.”
In Dickey v. Converse, 117 Mich. 449 (76 N. W. 80, 72 Am. St. Rep. 568), there is a citation and review of the many authorities, making it unnecessary to call attention to them here; In that case it is said:
“ This species of tenancy grows out of the unity of husband and wife, and is unlike that of joint tenants, who are each seised of an undivided moiety. The husband and wife are each seised of the whole, and not of undivided moieties. Hardenbergh v. Hardenbergh, 18 Am. Dec. 378 (10 N. J. Law, 42), note.”
It was held this rule applied to the crops growing upon the land, as well as the land itself.
Applying these principles of law to this case, it is clear that, if a trespass was committed, it was not committed upon the property ’and possession of the wife, so that she could recover, as counsel urge, one-half the damages, and for which she might give a release, but it was committed against the entire estate; and, to recover for such a trespass, the husband and wife must join. See, also, 21 Enc. PI. & Prac. 805, and cases cited. The case made by the plaintiff is not the case stated in the declaration. This makes it unnecessary to pass upon the other assignments of error.
The judgment is affirmed.
Hooker, C. J., Grant and Montgomery, JJ., concurred. Long, J., did not sit. | [
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Montgomery, J.
The Tawas State Savings Bank became insolvent July 23, 1898. At this date petitioners, according to the books of the bank, were depositors in the sum of $1.09. In October, 1899, they filed their petition, asking for an order directing the receiver to treat them as general creditors of the bank in the additional sum of §1,550. This petition was granted, and such an order made by Judge Simpson, who was then circuit judge. Both petition and order recite that petitioners were depositors, but the prayer of the petition is that they be made general creditors, and that is the language of the order. In June, 1901, petitioners filed a new petition, reciting that, upon the hearing of the former petition, the proofs showed that they were depositors, and that the designation of petitioners in the order as ‘ ‘ general creditors,’’instead of “depositors,” was a mistake, and asking to have the order amended by the substitution of the words “general depositors” for “general creditors.” The petition was denied by Judge Connine, Judge Simpson’s successor as circuit judge.
The proofs show .that petitioners had a contract with the French Land & Lumber Company, by which petitioners purchased of said lumber company certain ties, and sold the same to the Pontiac, Oxford & Northern Railway Company, and that petitioners gave the French Land & Lumber Company their notes for the ties received. $2,850 of these notes were outstanding at the time of the failure of the bank. They had passed from the lumber company through the hands of the bank, and had been rediscounted in Detroit. These facts were unknown to petitioners. None of the notes were due.
In June, 1898, petitioners deposited in the bank a draft for §1,425 from the Pontiac, Oxford & Northern Railway Company, which they had received in payment for ties. They left their pass-book at the bank to be balanced, and did not receive it back until after the bank failed. When they received their pass-book, they discovered for the first time that Mr. French, who was also cashier of the bank, had stricken out the credit in the pass-book, and inserted the memorandum, “Credited to French Land & Lumber Company,” and had also, without their knowledge, made a memorandum check against their account for $125, and credited the same to the French Land & Lumber Company. This was done to apply on petitioners’ indebtedness to the French Land & Lumber Company, represented by a note for $1,550 at that time held by the First National Bank of Detroit, under the indorsements of the French Land & Lumber Company and the bank, and due July 27th, four days subsequent to the failure of the bank. Mr. French testifies that there was an understanding with petitioners that the money received from the railway company by petitioners at this time should be applied on this note, that the credit of this draft to their account was a mistake, and that he merely corrected it. We think, however, that his testimony fails to make it clear that they agreed to pay this money to the French Land & Lumber Company at a time when the note was beyond the control of said company, making it impossible for the payment to be indorsed thereon, thus relieving petitioners from liability to the holders of the note to the extent of the payment. He nowhere testifies that this was the understanding, or that the agreement to which he testifies was made by petitioners knowing that the French Land & Lumber Company had disposed of the note.
Judge Simpson found, and we think correctly, that the shifting of the deposit of $1,425, and the drawing of the memorandum check for $125, were unwarranted. At that time he could have permitted an amendment to the prayer of the petition, and entered the order now sought, and such a course would have been in accordance with his finding on the facts.
The opinion of the present circuit judge is in part as follows:
“In looking at the original petition, there seems to be considerable doubt whether Mr. Kunze ever attempted to have himself classed as a depositor; and the order that Judge Simpson made in the case does not declare him to be a depositor, and does not make that draft or business' item a deposit in the bank. * * * I am unable to find from a preponderance of the evidence that the item involved in this, petition was a deposit, or should be so considered by the court, and for that reason the petition will be denied.”
"We think the finding that the items were not deposits is in conflict with the undisputed testimony; that it was within the power of the circuit judge to correct the mistake in Judge Simpson’s order; and that, as the order appealed from was entered upon the contrary theory, it should be reversed.
'Hooker, C. J., Moore and Grant, JJ., concurred. Long, J., did not sit. | [
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] |
Memorandum Opinion. Defendant was convicted and sentenced for the crime of felonious assault and appeals.
An examination of the record and briefs discloses no prejudicial error.
Affirmed. | [
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Per Curiam.
This is a zoning case. Plaintiffs complain that the zone restrictions to one-family and private two-family dwellings are unreasonable. They propose multifamily construction and for this purpose need B-l zoning.
In 1956 plaintiffs purchased 93 acres in Kalamazoo Township. The entire tract was zoned B residential. At that time 24 acres in the northern part of the tract were rezoned for a commercial shopping center. Contained in the remainder of the tract is an eight-acre parcel which is hilly and forested. The rest is clear and flat. Plaintiffs’ original plans for the tract were 201 residential lots, including 16 on the eight-acre subject parcel.
Early in 1965, township authorities granted plaintiffs’ application to rezone the eight acres to B-l to permit multiple dwellings. Building permits were applied for and granted to erect two such units.
In December, 1965, a number of citizens objected. At a township board meeting, a show of hands by aréá residents was for changing the zoning back to B. Thereafter, the township board, by a 4-3 vote, defeated a motion to uphold the B-l zoning and approved a motion, by a 6-1 vote, re-establishing B zoning. Plaintiffs’ building permits were then revoked.
Plaintiffs sought a circuit court order to declare the zoning ordinance unconstitutional and to prohibit defendants from interfering with a townhouse development. The complaint was dismissed.
On appeal, plaintiffs raise three issues. First, they argue that the trial court erred in deciding that since the zoning was reasonable as to¡ the entire tract, it was also reasonable as to the eight acres even though it was confiscatory as to this parcel. Second, they argue that it was error to uphold the zoning after finding that it was a result of public pressure. Finally, they argue the court erred in allowing the rezoning because they could build highrise apartments if the property remained B-l.
The trial court held:
“Plaintiffs’ property can be used for B residential purposes. No confiscation is involved therefor. It may be regrettable from plaintiffs’ viewpoint that they cannot utilize the eight acres for apartment or townhouse purposes and thereby realize a greater profit.
“For the foregoing reasons, plaintiffs’ complaint, is dismissed because in the opinion of this court the B residential zoning is not void and is not unconstitutional.”
In reaching its decision the trial court treated the 93-acre tract as a unit which could be profitably developed. The court did admit that a B-l zoning of the eight acres would result in greater profit to the plaintiffs but found that the parcel could be developed for residential use with the rest of the tract.
The zoning ordinance in question does not prevent plaintiffs from making reasonable use of their property or render it worthless. Pederson v. Township of Harrison (1970), 21 Mich App 535; Reibel v. City of Birmingham (1970), 23 Mich App 732. A zoning ordinance is not unconstitutional merely because the land would be worth more if rezoned. Reibel v. City of Birmingham, supra; Parkdale Homes, Inc. v. Township of Clinton (1970), 23 Mich App 682.
In his opinion, the trial judge commented that it seemed unfair to uphold a zoning change which was based chiefly on a citizen showing of hands and that the ordinance failed to distinguish between town houses and high-rise apartments. These were merely judicial comments. As to the former, this is not a case in which the zoning change was based entirely on citizen opinion, Certain-teed Products Corporation v. Paris Township (1958), 351 Mich 434. Under the circumstances we are not persuaded that the trial judge’s findings were clearly erroneous. GCR 1963, 517.1.
Affirmed. | [
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Per Curiam.
Defendants, Tyrone Williams and James Marlin, Jr., were tried jointly by a jury and convicted of assault with intent to commit armed robbery, MCLA 750.89; MSA 28.284, and assault with intent to commit great bodily harm less than murder, MCLA 750.84; MSA 28.279. Both defendants appeal as of right.
Defendants urge initially that the trial court committed reversible error in not striking from the record the testimony of a key prosecution witness. The witness, who alleged that he had driven defendants to the scene of the attempted robbery, stated that he had seen a gun used by defendants in their possession on the evening in question, April 24, 1970. On cross-examination, witness Bush testified that defendant had the gun “about the beginning of June”. On redirect examination, the witness again testified that defendant had the gun before April 25. This is not a case where the credibility of the witness was completely impeached. Rather, the inconsistency in the testimony of witness Bnsh was properly a factor to be considered by the jury in weighing the truth of his testimony. People v White, 31 Mich App 80 (1971); People v Gray, 23 Mich App 139 (1970).
Defendants also contend that the trial court committed error, while giving supplemental instructions, when it stated, “Now, if the man had died, it would have been murder”. Notwithstanding defendant’s arguments, this is not a case like People v Wojnicz, 12 Mich App 423 (1968), where the trial judge stated as a fact that which undisputed evidence tended to prove. Further, any prejudice which might have flowed from this statement was removed when the trial judge informed the jury that the reference he made to “the man” was only meant in a “broad general sense.” As this Court stated in People v Green, 34 Mich App 149 (1971):
“It is axiomatic that the jury instructions must be considered in their entirety; error cannot be established by one phrase lifted from the whole charge, unless the phrase prejudices the entire charge.”
There was no prejudice here, especially in view of the trial court’s corrective instruction.
Defendant Marlin also claims that the trial court committed error in allowing an in-court identification to be made of him. Defendant argues that the identification was tainted by prior custodial exposure to the witness, because the witness, one of the victims of the attempted robbery, was unable to identify defendant Marlin in pictures one week after the incident, in a lineup three weeks thereafter, and at the preliminary examination. He then made a positive identification of defendant Marlin at trial.
However, there was no tainted out-of-court confrontation between defendant Marlin and the witness. He was represented by counsel at the two lineups. United States v Wade, 388 US 218; 87 S Ct 1926; 18 L Ed 2d 1149 (1967). The trial court conducted a separate hearing to determine whether the lineup was “unnecessarily suggestive in nature when viewed ‘within the totality of the circumstances’People v Young, 21 Mich App 684, 688 (1970) . He concluded that it was not. The record fails to reveal that the trial judge erred in this conclusion. Thus, the weight to he given the in-court identification under the circumstances of this case was for the jury to determine. People v Wright, 35 Mich App 365 (1971); People v Jordan, 34 Mich App 360 (1971); People v DuPuie, 31 Mich App 14 (1971) .
Affirmed. | [
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Bronson, J.
Plaintiff appeals a Kent County Circuit Court order of summary judgment for defendant, Anton Vogel, Jr., M.D.
On March 17,1967, plantiff filed a two-count complaint against Haviland Products Company and the defendant for injuries resulting from a fall alleged' to have been caused by a Haviland Products employee and for supposed negligent diagnosis and treatment of those injuries by defendant.
Plaintiff settled with Haviland Products on May 24,1968, for $4,000, and signed a release of all claims he had against the company. The release had the following clause: “It is expressly understood that this release is given by Anselm Sobotta to Haviland Products Company, only, and is no way intended to release or affect the claims Anselm Sobotta has against Anton Vogel, Jr., M.D.” Haviland Products was dismissed with prejudice from the lawsuit.
Subsequently, the order for summary judgment was entered in defendant’s favor. Plaintiff appeals.
Plaintiff’s only contention on appeal is that the release of the original tortfeasor, containing an express reservation of right against a physician treating the injury arising from the original tort, does not operate as a bar to a claim against said physician for malpractice. Our courts have never spoken on this precise issue.
At the outset it can be said that MCLA § 600-.2925(2) (Stat Ann 1962 Rev § 27A.2925[2]) is inapplicable. This statute permits a person to release one or more joint tortfeasors from liability without impairing his rights against joint tortfeasors he has not released. Joint tortfeasors, in general, are two or more persons who owe to another the same duty and whose common neglect of that duty results in injury to such other person. Moyses v. Spartan As phalt Paving Company (1970), 383 Mich 314, 329. Haviland Products and the defendant each owed the plaintiff a different duty. Their actions toward the plaintiff were independent and successive. They are not joint tortfeasors within the meaning of MCLA § 600.2925(2), supra. We must look to the common law for an answer to plaintiff’s contention.
The only Michigan case dealing with release of other than joint tortfeasors our research has been able to find is Ceib v. Slater (1948), 320 Mich 316. This case held that a party who releases a tortfeasor who has acted independently and concurrently with another to cause a single indivisible injury releases all such tortfeasors. The instant case is distinguishable in that the alleged torts of Haviland Products and defendant arguably resulted in an injury for which damages may be apportioned. The argument was well stated in Derby v. Prewitt (1962), 12 NY2d 100, 105-106 (236 NYS2d 953, 958-959, 187 NE2d 556, 559-560):
“As to the first asserted basis for the rule, it is obvious that the taxicab driver and the doctor, having neither acted in concert nor contributed concurrently to the same wrong, are not joint tortfeasors. (See Matter of Parchefsky v. Kroll Bros., Inc. (1935), 267 NY 410, 413-414, 196 NE 308, 310-311, 98 ALR 1387.) Their wrongs were independent and successive, rather than joint, and, this being so, the plaintiff had not one but two separate and distinct causes of action, one against the cab driver for the negligent operation of his vehicle and the other against the doctor for his alleged malpractice in treating the fracture which the plaintiff sustained in the automobile accident. It is true that the driver could have been held liable for the aggravation of the injury caused by the doctor’s negligence but, as pointed out above, that liability is not the result of any concept of joint wrongs but is rather the product of the familiar rule that a wrongdoer is responsible for the reasonably foreseeable consequences of his tortious act, including the negligent conduct of others. Conversely, it would defy reason to hold the physician liable for injuries caused by the original wrongdoer which were not the consequences of his own carelessness, and no one suggests that a release of the doctor would completely discharge the original wrongdoer.
“Nor does the second asserted reason for the release doctrine — the presumption of full satisfaction — make any sense in the context of this case. Irrebuttable presumptions have their place in the law but only where public policy demands that inquiry cease. Where the cause of action is single and the liability of one wrongdoer is identical with that of the other, there may be warrant for erecting such a barrier to suit after settlement. However, where, as here, neither of these elements is present, there is no basis or justification for preventing the plaintiff, by an artificial rule of law, from recovering the full compensation to which she would otherwise be entitled for her injuries.
“Since, therefore, neither the joint tortfeasor doctrine nor the reasons underlying it are here applicable, we may not say, as a matter of law, that the release executed by the plaintiff bars the present action. In the light of our analysis, the question for resolution, and it is to be decided as an issue of fact upon a trial, is whether the plaintiff’s settlement with the taxicab driver did actually constitute satisfaction of all damages caused by his wrong or was intended as such. If it did, or was so intended, no claim remained against the doctor. But, if it did not reflect full satisfaction, and was not so regarded— and the burden of proving this essential fact rests upon the plaintiff — the release will not prevent recovery against the doctor. Our conclusion is firmly supported not only by considerations of reason and basic fairness but also by well-considered cases in other jurisdictions. [Citations omitted.]”
It is well settled that an injured party is entitled to only one satisfaction. It is also settled law that where damages are apportionable, the original tortfeasor is liable for the foreseeable consequences of his negligence while the second tortfeasor is liable only for the damages proximately caused by him. Meier v. Holt (1956), 347 Mich 430. Plaintiff received $4,000 from Haviland Products. Whether this amounts to a complete satisfaction is a question of fact for determination by the trier of fact. We are not bound by the trial judge’s ruling since he did not sit as a trier of fact. If the $4,000 is a complete satisfaction, plaintiff, as a matter of law, is not entitled to further damages from defendant. If, however, the $4,000 was not a complete satisfaction, plaintiff may have his claim against defendant tried on the merits. Since Haviland Products is also liable for defendant’s negligence, if any, $4,000 should be subtracted from any judgment returned against defendant.
Reversed and remanded for further proceedings consistent with this opinion.
All concurred.
Overruled on another point in Moore v. Palmer (1957), 350 Mich 363. In Duncan v. Beres (1968), 15 Mich App 318, 329, Judge Levin severely criticized Geib and suggested it be overruled on the point in question. In doing so, he noted that the rule there stated was against the modern trend. | [
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Fitzgerald, J.
Plaintiff and his wife own property fronting on both sides of Leonard Road, a primary county highway running east and west through Ottawa County. The road is not on a section line, but meanders from the western edge of Kent County to Spring Lake on the western edge of Ottawa County. The plaintiffs own 443.2 feet on the south side of Leonard Road and 338.25 feet on the north side.
At the point where the plaintiff’s property is located, the road is paved approximately 18 feet wide and has shoulders approximately 6 feet wide for a total of 30 feet. At one point, the road crosses a ravine, and in 1914 the ravine was filled to accommodate the road bed and a culvert 55 feet wide was built to allow the drainage of water. This culvert extends 26 feet north and 29 feet south of the center-line of the pavement.
The defendant wishes to widen Leonard Road, and claims ownership of a right-of-way 66 feet wide. The county bases its claim upon the plat of the Village of Eastmanville, which was recorded in 1855 and which, it is contended, established a dedication of a road 66 feet wide.
The plaintiff argues that the county has rights in the highway by user (as opposed to dedication) and therefore has rights only to those portions actually used. The plaintiff’s garage extends 4 to 5 feet into the proposed easement, and he has extensive landscaping, including a rock garden and irrigation system which are within the county’s proposed 66-foot-wide strip.
The plaintiff sought and obtained an injunction against the defendant, alleging damage to real property, and alleged that the defendant had no right to exercise control over any portion of land other than that already in use without condemnation proceedings. A hearing was held in July, 1970 and the trial court issued an opinion on December 4, 1970.
In the opinion, the judge found that there had been no express or implied dedication of Leonard Road and that the defendant had a public easement created and governed by user. The court further found, however, that the defendant had an easement that was as wide as the' “distance of the center of the pavement to the most distant evidence of public activity in either direction”. The court then found that the culvert built across the ravine should give reasonable notice to a reasonable person that the county had an easement 55 feet wide and set the boundaries of Leonard Road as 26 feet north and 29 feet south of the center of the pavement.
The plaintiff appeals that portion of the trial court’s ruling which gives defendant an easement 55 feet wide. The plaintiff feels that the county is only entitled to the land actually taken by user, and that the court’s granting of an easement 55 feet wide was erroneous. The defendant, on February 23, 1971, filed a cross-claim of appeal alleging as error the finding of the trial court that the road was obtained by user and not dedication, and that even if the road was obtained by user, then the boundary should be 66 feet wide or in the alternative that the northern boundary should be 30 feet from the centerline and not 26 feet as found by the trial judge.
In reviewing findings of fact, the Court of Appeals gives considerable weight to the findings of the trial judge and will not reverse the trial court’s findings unless they are “clearly erroneous”. GCR 1963,
517.1; Littell v. Knorr (1970), 24 Mich App 446; State Bank of Sandusky v. Boddy (1969), 17 Mich App 466; Tann v. Allied Van Lines, Inc. (1966), 5 Mich App 309. The first test, therefore, is to see what evidence was needed and was produced to sustain the plaintiff’s position and the trial judge’s finding that Leonard Road was acquired by user and not dedication.
In order to find that a piece of property has been dedicated to the public use by the owner of the property, there must appear a clear intent on the part of the owner to dedicate his property for such use. Hawkins v. Dillman (1934), 268 Mich 483; Vance v. Village of Pewamo (1910), 161 Mich 528; Irving v. Ford (1887), 65 Mich 241. It is true that intent may be found from the actions of individuals, but such actions must be unequivocal. Ellsworth v. City of Grand Rapids (1873), 27 Mich 250; People v. Jones (1858), 6 Mich 176.
In determining the existence of an intention to dedicate, all of the facts and circumstances bearing on the question must be considered and, to be sufficient, they must positively and unequivocally disclose the requisite intention. This Court in the recent case of Littell v. Knorr, supra, p 452, has quoted the following:
“ ‘The facts and circumstances relied upon to prove the existence of an intent on the part of the dedicator must be of a positive and unequivocal character. Since, by a dedication, valuable rights in lands pass from the owner, no presumption of an intent to dedicate arises, unless it is clearly and expressly shown by his acts and declarations, or by a line of conduct the only reasonable explanation of which is that a dedication was intended. (Emphasis added).’ ” 9 Am & Eng Enc Law (2d Ed), p 38, and cases cited. (Quoting from Hawkins v. Dillman, supra, and Vance v. Village of Pewamo, supra.)
The evidence appears in the case to support the trial judge’s finding: Timothy Eastman owned the land in question when the plat of Eastmanville was recorded, and all conveyances from him to plaintiff’s grantors mentions the highway but never mentions the width. There is no proof of sale or dedication by any of plaintiff’s predecessors in title. The disputed property has not been used by the public or maintained by officials as a public road, but has been used exclusively by the plaintiffs and their predecessors as private property.
This evidence leads to the conclusion that Leonard Road was obtained by the defendant through user and not dedication. While it is true that the defendant introduced evidence to the opposite effect, the defendant was required to show dedication by positive and unequivocal evidence. Littell, supra; Hawkins, supra; Vance, supra.
In light of these considerations, it cannot be said that the finding of the trial judge was “clearly erroneous,” and therefore the finding of the trial court that Leonard Road was obtained by the defendant through the principle of user is sustained.
The trial court’s opinion, relating to the extent of the land obtained for the public through the principle of user, stated as follows:
“We are thus confronted with the issue — what is the extent of the user by the public?
# # #
“Within plaintiff’s property Leonard Road traverses a ravine. In 1912 defendant, by resolution, took Leonard Road into the county road system. In 1914 the records indicate that the ravine was filled to accommodate the road bed. Exhibit B indicates that the fill extended 26 feet to the north of the center and 29 feet to the south of the center of the road, or a width of 55 feet. A concrete retaining wall 200 feet long has been installed close to the top of the fill to the south of the pavement. A culvert extends through the fill, north and south, to the extent of 55 feet.
“Plaintiff’s garage extends 4-5 feet into the proposed 66' easement. He also has a portion of his lawn, rock gardens, hedges, landscaping and sprinkling system within the 66' width. Plaintiff claims no rights by adverse possession, he challenges defendant’s extent of user.
“It is the opinion of the court that the width of the public easement is evidenced by the distance from the center of the pavement to the most distant evidence of public activity in either direction. An ordinary reasonable person would have reasonable notice that public activity along side a public highway is evidence of a claim of right to that distance from the highway.
“So in the matter before the court the extensive use by the public in an area 55 feet wide is ample notice to all of an easement of that width and especially to plaintiff and his predecessors in title. The court so finds. Under this finding the court places the boundaries of Leonard Road as 26 feet north and 29 feet south of the center of the pavement.”
Plaintiff appeals from this finding.
The plaintiff argues that the law of Michigan clearly states that the land acquired by user can only extend to the amount of land actually used for the road, and that the trial court’s granting of land to the extent of 55 feet cannot be sustained. He cites for this proposition, Eager v. State Highway Commissioner (1965), 376 Mich 148; and Yonker v. Oceana County Road Commission (1969), 17 Mich App 436.
The defendant argues that MCLA 221.20; MSA 9.21 establishes that all highways obtained by user are to be 4 rods (or 66 feet) wide. That statute states that:
“All highways regularly established in pursuance of existing laws, all roads that shall have been used as such for 10 years or more, whether any record or other proof exists that they were ever established as highways or not, and all roads which have been or which may hereafter be laid out and not recorded, and which shall have been used 8 years or more, shall be deemed public highways, subject to be altered or discontinued according to the provisions of this act. All highways that are or that may become such by time and use, shall be 4 rods in width, and where they are situated on section or quarter section lines, such lines shall be the center of such roads, and the land belonging to such roads shall be 2 rods in width on each side of such lines.”
The defendant feels that this statute, and the cases of Bumpus v. Miller (1856), 4 Mich 159; and Kruger v. Le Blanc (1888), 70 Mich 76, established that a road obtained by user is always to be 4 rods wide.
The defendant notes in his brief that two recent cases (Eager, supra, and Yonker, supra) seem to hold to the opposite effect without specifically overruling either the Bumpus. or the Kruger cases. The defense feels, therefore, that this area is in confusion.
Such, however, is not the case.
A reading of both the Bumpus case and the Kruger case demonstrates that they do not stand for the proposition cited by defendant. In both of those cases, it was found that there had been a specific dedication of a road 66 feet wide. For a discussion of these cases, see Smith v. State Highway Commissioner (1924), 227 Mich 280. The Bumpus and Kruger decisions have consistently been held to stand for the proposition that the roads obtained by implied dedication are 66 feet wide only if the grants were not expressly or impliedly restricted by the owner of the property.
As early as 1887, one year before Kruger, it was established law that the State could obtain by user only the land actually so used. In the case of Scheimer v. Price (1887), 65 Mich 638, 639, the Supreme Court said:
“The plaintiff sought to establish the highway by proving user. It appeared by the plaintiff’s own showing that the public had never used the strip of land claimed to constitute a part of said highway by the plaintiff, and owned by the defendant, about two rods wide, and over a hundred rods long; and that the alleged encroachment was defendant’s fence, enclosing said strip with his other lands. A highway by user includes only so much land as is used for that purpose, and it cannot he extended upon adjacent lands, against the consent of the owner, except under proper proceedings for condemnation for that purpose.”
As recently as 1965 the Michigan Supreme Court reaffirmed this principle in the case of Eager, supra. The Court begins by distinguishing Bumpus and DeFlyer v. Oceana County Road Commissioners (1965), 374 Mich 397 (also relied upon by defendant) as applying to those cases where there had been an express grant of an easement 66 feet wide, or where the landowner had failed to dispute the claim of the public to an easement of 66 feet. In other cases, the Court in Eager said, p 154:
“We agree with the trial court that privately owned land cannot become public road by user beyond the portion used as such merely by the above noted statutory pronouncement to that effect. [Referring to MCLA 221.20; MSA 9.21.] To so hold would be violative of Constitution of 1850, Art 18, § 14, Constitution 1908, Art 13, § 1, which prohibited taking by the public of private property except upon determination of necessity and just compensation ‘being first made or secured’.”
The conclusion reached by the Court is that when a highway is appropriated for public use by the principle of user, there is a statutory presumption that such a road is 66 feet wide, but that this presumption is rebuttable unless it can be shown that the owner of the land expressly or impliedly agreed that the roadway was to be 66 feet wide. In cases where the presumption is rebutted, the roadway is restricted to that area actually appropriated and used for road purposes.
In the instant case, the plaintiff or his predecessors in title built the garage well within the proposed 66-foot right-of-way and built and landscaped the rock garden and irrigation system within the proposed right-of-way. This is strong evidence that the owners of land never agreed or acquiesced in Leonard Road’s being 66 feet wide. This case, therefore, falls within those cases where the right-of-way is confined to that portion of the land actually used as such.
The defendant argues, in the alternative, that if the county is not entitled to the full 66-foot width, then the judge’s order should be modified to give the county another 4 feet to the north. The basis for this argument is that the trial judge set the northern boundary of the right-of-way to coincide with the northern edge of the culvert (which was 26 feet north of the centerline of Leonard Road). The defendant now argues that there is a 3-foot spillway just east of the culvert which extends to 30 feet north of the centerline and thus, using the reasoning of the court, the county should be entitled to an easement over the plaintiff’s property 30 feet to the north of the centerline of Leonard Road. If the trial court’s formula was correct, then the defendant could have a valid argument. However, extensive research has disclosed no authority for the judge’s formula.
While the Court has no authority supporting the judge’s formula (and indeed the trial court did not cite any), it must be admitted that there was also no authority directly on point that said the formula was incorrect. Instead, we must rely upon general principles of law, one of which is found in the Michigan Constitution of 1963. Art 10, § 2 of the Constitution says that:
“Private property shall not be taken for public use without just compensation therefor being first made or secured in a manner prescribed by law. Compensation shall be determined in proceedings in a court of record.”
At the same time, as discussed earlier, the courts have held that the road is to be confined to that portion of land actually used. Coleman v. Flint & P.M.R. Co. (1887), 64 Mich 160; Scheimer v. Price (1887), 65 Mich 638; Smith v. State Highway Commissioner (1924), 227 Mich 280; Eager, supra; Tonker, supra. Nowhere, in any of those cases, does it say that the width of the road “is evidenced by the distance from the center of the pavement to the most distant evidence of public activity in either direction,” as the trial court held.
If this formula is correct, it results in a net loss to plaintiff of approximately 9,924 square feet of land. This figure is obtained by taking the present distance from the center of Leonard Road to the edge of both shoulders (15 feet), then subtracting that from the width granted by the trial court (26 feet on the north, and 29 feet on the south). This arrives at a. strip of land 11 feet wide on the north of Leonard Road and 14 feet wide on the south of Leonard Road that the trial court’s opinion gives to the defendant in excess of that already in use as a road. Next, by taking the frontages and multiplying by the width, we arrive at the approximate square feet lost to the plaintiff. This does not make allowance for the portion of the culvert existing on the plaintiff’s property on the south side of Leonard Road.
The grant of 9,924 square feet of land to the defendant which had not before been used as a highway is not in keeping with the spirit of those cases which have long and consistently held that the width of the road is to be confined to that already used for such purposes.
It appears that the trial court was correct in holding that Leonard Road was established by user, and not by dedication. It also is clear that consistent with such a holding is the principle that such a road does not automatically extend to a width of 66 feet. Therefore, that portion of the trial court’s finding is affirmed.
It is not clear whether the judge’s formula for deciding what actually was used as a road and the width of that road was correct. In sustaining the judge’s findings, the plaintiff will lose approximately 9,924 square feet of land that he and his predecessors in title believed was theirs, and improved consistent with such a belief. This formula is incorrect as violating the spirit of Const 1963, art 10, § 2, and those cases holding that the highway should be confined to the area actually used. Therefore, this portion of the order is modified so that the boundaries of the public easement are established at the present use.
Affirmed in part, reversed in part, and remanded for entry of judgment confining the area to that actually used for a road. Costs to appellant.
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V. J. Brennan, P. J.
The facts of this case are detailed in an earlier decision of this Court, Kahoun v Metropolitan Life Insurance Co, 12 Mich App 441 (1968), and may be briefly summarized as follows: Plaintiff’s decedent originally sued defendant for reimbursement if certain medical expenses supposedly covered by an insurance policy issued by defendant. The latter denied liability and raised the affirmative defenses of fraud and misrepresentation, alleging that plaintiff had falsely answered certain questions in his application for insurance.
Although plaintiff had timely demanded a jury trial, the cause was tried by the court, with judgment for defendant. Plaintiff appealed his denial of a jury trial, and this Court reversed and remanded, holding that the issue of fraud could be adequately adjudicated as an affirmative defense to a law action tried by a jury, and that plaintiff had improperly been denied a jury trial. Kahoun v Metropolitan Life Insurance Co, supra.
Upon remand, defendant, pursuant to a stipulation by the parties, filed a counterclaim alleging fraud and phrased in terms practically identical with those of its former affirmative defense. Defendant asked for delivery and cancellation of the policy and prayed for “such other and further relief as is agreeable to equity and good conscience”. Defendant then moved the trial court to separate the legal and equitable issues pursuant to GCB 1963, 207 and 505.2, and asked for a nonjury trial on the counterclaim.
The trial court ruled that plaintiff’s complaint was based upon a legal claim involving legal issues, while defendant’s counterclaim was based on an equitable claim with equitable issues. Accordingly, the court ordered the issues separated for trial “in the furtherance of convenience and to avoid prejudice”, with the legal issue tried to a jury and the equitable issues later tried to the court.
The parties then stipulated to a judgment on the legal issues, and the jury then entered a directed special verdict for plaintiff. The jury found that plaintiff had been insured by defendant, that plaintiff had been hospitalized while the policy was in force, and that plaintiff sustained expenses of $1,367 which were not reimbursed by defendant.
Defendant’s counterclaim was held over for later trial. Plaintiff’s application for leave to appeal the trial court’s order for a separate nonjury trial on defendant’s counterclaim was granted by this Court on September 15,1970.
The issue before the Court is whether defendant’s counterclaim was properly severed and held over for trial by the court without a jury.
Since there are no Michigan cases directly on point, and since there is a great deal of similarity between GrCR 1963, 508, and Rule 38 of the Federal Rules of Civil Procedure, we will look to Federal cáse law for assistance in resolving this question. It has long been the position of the Federal courts that “in the absence of special circumstances * * * ‘fraud in the procurement of insurance is provable as a defense in an action at law upon the policy, the resort to equity being unnecessáry. to render that defense available’ ”. Ettelson v Metropolitan Life Insurance Co, 137 F2d 62, 65 (CA 3, 1943). We agree with that rationale and hold that plaintiff’s claim and defendant’s counterclaim, treated as an affirmative defense, should both have been tried to a jury.
Remanded for proceedings consistent with this, opinion.
All concurred.
The original plaintiff, George S. Kalionn, had died and his wife, as administratrix of his estate, was substituted as party plaintiff. | [
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O’Hara, J.
This is an appeal of right from the order of the trial court granting defendants’ motion for summary judgment.
Plaintiffs, who are citizens of Sterling Heights and users of the municipality’s water and sewer services, objected to the city council’s adoption of Ordinance 69G, establishing new rates for these services. They sought a referendum on the question of whether the new rates should be retained. The defendant City of Sterling Heights, through its officers, refused to honor this petition. Thereafter, plaintiffs sought mandamus to compel placing this referendum before the voters.
Able counsel for plaintiffs relies on McKinley v. City of Fraser (1962), 366 Mich 104, as authority for his contention that the revenue bond act does not preclude a referendum by the citizens of Sterling Heights with regard to the rate schedule for sewer and water services. Since, he argues, the Supreme Court in McKinley, supra, recognized the right of the electorate, pursuant to local ordinance adopted under authority of the home rule act, to vitiate a rate ordinance for users of a sewage disposal system by means of initiative, it would be illogical for this Court to construe the revenue bond act as implicitly limiting the power of referendum when the same result (adoption of a rate ordinance) may be achieved via the initiative route as in McKinley.
The argument is ingenious, but a careful examination of McKinley reveals significant distinctions between that case and the case at bar. There were no bonds proposed or outstanding in McKinley. In addition, and more importantly, McKinley did not involve an ordinance enacted pursuant to the enabling clause of the revenue bond act.
The Revenue Bond Act of 1933, being MCLA § 141.101, et seq. (Stat Ann 1969 Rev § 5.2731, et seq.), recognizes the authority of municipal corporations to raise funds for construction, operation, and maintenance of public utilities.
MCLA § 141.102 (Stat Ann 1969 Rev § 5.2732), provides that powers conferred by the revenue bond act shall not be affected or limited by any other statute or charter unless otherwise provided in this enactment. A companion statute provides that bonds authorized by this act shall not be subject to any limitation by other laws or charters of public corporations. In like manner, the home rule act requires that provisions in city charters not conflict with any general law of the state. MCLA § 117.36 (Stat Ann 1949 Rev § 5.2116). The revenue bond act has been classified as general legislation. Bullinger v. Gremore (1955), 343 Mich 516, 544.
As a result, we must determine whether a referendum is mandatory from the language of the Revenue Bond Act of 1933 and judicial constructions thereof.
MCLA § 141.106 (Stat Ann 1969 Rev § 5.2736) authorizes the governing body of a public corporation to adopt ordinances relating to the exercise of the powers granted therein and for all other matters deemed necessary or desirable to effectuate the intent of the act. Ordinances thus adopted become effective upon adoption and are not subject to a referendum vote of the electors with the one exception contained in § 33 of the act.
Section 33, MCLA § 141.133 (Stat Ann 1971 Cum Supp § 5.2763), permits the financing of public improvements by a bond issue not previously submitted to the electorate; but it also provides that if the voters file a timely petition for referendum pursuant to § 33 before issuance, approval of the electorate becomes a condition precedent.
Since nothing other than a referendum concerning the issuance of bonds is mentioned in this section, it cannot be construed as requiring public approval for passage of any ordinance under this act, except the original bond issue.
MCLA § 141.121 (Stat Ann 1969 Rev § 5.2751) requires that rates charged for use of public improvements be adequate to meet both operating expenses and principal and interest on the bonds. This section further obligates the governing body of the public, corporation to revise rates periodically in order to produce sufficient revenue for the improvements to meet expenses.
In North Muskegon v. Construction Co. (1953), 335 Mich 520, a unanimous Supreme Court construed MOLA § 141.121, supra, as placing “the amount of the charge * * * within the sound discretion of the city officials, especially when considered in relation to the objectives of the program in maintaining the system and paying off the bonds in the manner required by statute”, (p 527.)
Where municipalities engage in authorized activities for public purposes, courts will not interfere with discretionary acts of municipal officers in the absence of malicious intent, arbitrary action, or corrupt conduct. North Muskegon, supra, p 526.
For the reasons set forth hereinbefore, we conclude that the proceedings were without error and that the trial court acted properly in granting defendants a summary judgment.
Affirmed.
All concurred.
The amendment marked the seventh time that rates have been increased since commencement of the services.
MCLA § 117.4i (Stat Ann 1971 Cum Supp § 5.2082).
It hardly requires comment that the public water and sewer facilities herein are within the statutory definition of “public improvements”. MCLA § 141.103 (Stat Ann 1969 Rev § 5.2733).
MCLA § 141.111 (Stat Ann 1969 Rev § 5.2741).
The revenue bond act does not proscribe the use of any available revenues to cover the cost of public improvements. MCLA § 141.123 (Stat Ann 1969 Bev § 5.2753).
Also, see Cohn v. Oakland (1958), 354 Mich 180, 185.
Neither the reasonableness of the rates nor an abuse of discretion were raised below. | [
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Per Curiam.
Following a mistrial, and on retrial, defendant was convicted by a jury 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). Defendant then pleaded guilty of being a second-offense habitual offender, MCL 769.10; MSA 28.1082. He was sentenced to the mandatory two years’ imprisonment for the felony-firearm conviction to be served consecutively to a twenty-five to sixty-year term of imprisonment imposed for the armed robbery conviction. Defendant appeals as of right. We affirm.
i
Defendant’s convictions arise from an armed robbery and shooting that occurred on January 1, 1992, in the City of Kalamazoo. As Martin Marlowe, James Alexander, and John Rogers sat talking in Alexander’s vehicle, which was parked in the driveway behind Marlowe’s residence, they were approached by three males, one of whom was defendant, and asked if they wished to purchase narcotics. Alexander responded negatively. Defendant and his companions then walked away from the vehicle. A short time later, defendant and his companions returned to Alexander’s vehicle, displayed firearms, and ordered the occupants from the vehicle. Marlowe, Alexander, and Rogers got out of the vehicle. They were then told to empty their pockets. As Marlowe and Rogers complied, Alexander pushed one of the robbers and fled. In the resulting chaos, Marlowe, Alexander, and Rogers were able to escape, but not before Alexander suffered a gunshot wound to the right calf.
Defendant denied any involvement in the robbery or the shooting. He testified that on the evening in question he was at the home of his grandmother, then at the home of a friend, and finally at the University Inn with a friend and her two companions.
n
Defendant argues that he was denied his right to the equal protection of the law and his right to an impartial jury drawn from a representative cross sec tion of the community because the process used by Kalamazoo County to allocate prospective jurors from a general source list to its circuit court venires systematically excluded African Americans from those venires. Unlike in People v Hubbard (After Remand), 217 Mich App 459, 465; 552 NW2d 493 (1996), defendant’s challenge to his jury array was not made until after his jury had been impaneled and sworn. Accordingly, the challenge was not advanced in a timely fashion. People v McCrea, 303 Mich 213, 278; 6 NW2d 489 (1942); Hubbard, supra at 465. Moreover, after defendant raised his untimely challenge, he failed to create a factual record to support his claim. In fact, defendant declined the trial court’s offer to summon the county’s jury clerk to testify about the allocation process. On this record, defendant has forfeited appellate consideration of this issue.
in
Defendant next argues that he was denied a fair trial when the trial court required him to wear shackles and belly chains in the presence of the jury. We disagree.
Freedom from shackling is an important component of a fair trial. People v Williams, 173 Mich App 312, 314; 433 NW2d 356 (1988). Consequently, the shackling of a defendant during trial is permitted only in extraordinary circumstances. People v Jankowski, 130 Mich App 143, 146; 342 NW2d 911 (1983). Restraints should be permitted only to prevent the escape of the defendant, to prevent the defendant from injuring others in the courtroom, or to maintain an orderly trial. People v Dunn, 446 Mich 409, 426; 521 NW2d 255 (1994). This Court reviews a decision to restrain a defendant for an abuse of discretion under the totality of the circumstances. Williams, supra at 314-315.
The trial court based its decision to restrain defendant during trial on information contained in documents maintained by the Department of Corrections and the Kalamazoo County Jail. Defendant’s extensive institutional misconduct record, as detailed in these documents and as summarized by the trial court, demonstrates that defendant lacks respect for authority, lacks the discipline to conform his behavior to accepted norms, and has a tendency toward violence. Prior conduct of this nature amply supports the trial court’s decision to require defendant to wear shackles and belly chains while in the courtroom. People v Julian, 171 Mich App 153, 160-162; 429 NW2d 615 (1988).
IV
Defendant also argues that he was denied a fair trial by several instances of prosecutorial misconduct. We disagree.
Defendant contends that his Fifth Amendment right to remain silent was impermissibly infringed upon when the prosecutor questioned him concerning whether he had ever informed the police of his alibi defense. Defendant has forfeited appellate consideration of this issue.
A defendant waives his privilege against self-incrimination when he takes the stand and testifies. People v Alexander, 188 Mich App 96, 102; 469 NW2d 10 (1991). Consequently, the defendant may be impeached with evidence of both prearrest and postarrest silence without violating the Fifth Amendment as long as the silence precedes the advising of the defendant of his rights pursuant to Miranda v Arizona, 384 US 436; 86 S Ct 1602; 16 L Ed 2d 694 (1966). Alexander, supra. Where silence follows the receipt of Miranda warnings, however, the Fourteenth Amendment right to due process bars the use of such silence to impeach the defendant’s exculpatory explanation at trial provided the defendant does not claim to have told the police the same version upon arrest, People v Sutton (After Remand), 436 Mich 575, 580, 592; 464 NW2d 276 (1990), or to have cooperated with the police, People v Vanover, 200 Mich App 498, 503; 505 NW2d 21 (1993). Generally, when a prosecutor cross-examines a defendant regarding the defendant’s failure to advance his exculpatory explanation upon arrest and the record is unclear regarding whether, and, if so, when, the defendant received his Miranda warnings, the procedure is to remand the case to the trial court for an evidentiary hearing. Alexander, supra at 105. The defendant may forfeit his right to an evidentiary hearing, however, if the defendant fails to allege sufficient facts to justify a remand, i.e., that any comment was made in the presence of the jury regarding the defendant’s silence following the receipt of Miranda warnings. Weir v Fletcher, 680 F2d 437, 438 (CA 6, 1982).
In the case before us, defendant not only failed to object to the prosecutor’s cross-examination of defendant regarding his failure to inform the police of his alibi defense but also failed to set forth any allegations of fact in his appellate brief from which we can infer the need for a remand. Under these circumstances, we deem defendant’s claim forfeited.
Defendant next contends that the prosecutor used her closing argument to shift the burden of proof to defendant to prove his alibi defense. Defendant failed to object below to the prosecutor’s now-challenged remarks. Accordingly, defendant’s claim of misconduct is not preserved for our review. People v Gonzalez, 178 Mich App 526, 534-535; 444 NW2d 228 (1989). This Court will not review an unpreserved claim of prosecutorial misconduct unless the failure to do so will result in a miscarriage of justice. Id. No miscarriage of justice will result absent our review. When read in context, the prosecutor’s remarks constitute permissible comment concerning the weakness of defendant’s alibi defense and his failure to produce his corroborating alibi witnesses. People v Holland, 179 Mich App 184, 190-192; 445 NW2d 206 (1989).
Likewise, defendant failed to preserve for appellate review his contention that the prosecutor shifted the burden of proof by suggesting to prospective jurors that defendant had to establish a reason to doubt his guilt. Gonzalez, supra. No miscarriage of justice will result absent review because the prosecutor conveyed no such concept of reasonable doubt to the array. People v Jackson, 167 Mich App 388, 391; 421 NW2d 697 (1988).
Defendant also did not preserve for appeal his contention that the prosecutor improperly implied during argument that defendant had committed other robberies. Gonzalez, supra. Again, no miscarriage of justice will result absent appellate review. The prosecutor’s now-challenged comments do not suggest that defendant committed other armed robberies for which he was not charged in this case. Instead, when read in context, the comments merely contain a refer ence to armed robbers in general and constitute an explanation that armed robbers, as a class, tend to commit crimes under circumstances that make their apprehension by police less likely. Moreover, the comments came in response to defendant’s argument that the prosecutor had failed to present any physical evidence linking defendant to the armed robbery for which he was charged and that the prosecutor had presented only questionable identification testimony to establish defendant’s involvement in the robbery. Under such circumstances, defendant’s right to a fair trial was not compromised. People v Lawton, 196 Mich App 341, 353-354; 492 NW2d 810 (1992); Gonzalez, supra.
v
Defendant argues that trial counsel rendered ineffective assistance. Defendant failed to create a testimonial record in the trial court with regard to his claims of ineffective assistance. This failure forecloses appellate review unless the record contains sufficient detail to support defendant’s claims. People v Ginther, 390 Mich 436, 443; 212 NW2d 922 (1973); People v Barclay, 208 Mich App 670, 672; 528 NW2d 842 (1995); People v Hedelsky, 162 Mich App 382, 387; 412 NW2d 746 (1987). The record before us lacks sufficient detail for us to evaluate defendant’s claims that his counsel was ineffective in failing to object to the prosecutor’s impeachment of defendant with evidence of his silence, in failing to present the alibi testimony of three witnesses, in failing to produce at trial various police reports, school records, and motel records, in failing to instruct defendant not to mention his prior criminal record during testimony, and in failing to obtain transcripts of defendant’s first trial for impeachment purposes. Accordingly, appellate review of these claims is precluded.
Defendant’s contention that counsel rendered ineffective assistance in failing to object to the prosecutor’s burden-shifting comments lacks merit. As previously explained, the prosecutor made no such comments. Accordingly, we reject defendant’s contention. People v Pickens, 446 Mich 298, 302-303, 314; 521 NW2d 797 (1994).
VI
Defendant argues that he was deprived of his right to a fair trial by the prosecutor’s failure to produce a res gestae witness at trial. Defendant failed to preserve this issue for review because he did not raise the issue below in a motion for a posttrial evidentiary hearing, People v Pearson, 404 Mich 698, 722-723; 273 NW2d 856 (1979), or in a motion for a new trial, People v Jacques, 215 Mich App 699, 702; 547 NW2d 349 (1996); People v Jackson, 178 Mich App 62, 66; 443 NW2d 423 (1989). Accordingly, we decline consideration of this issue.
We also decline defendant’s invitation to remand this case for an evidentiary hearing pursuant to Pearson, supra. On the morning of sentencing, defendant informed his counsel and the trial court of the existence of an eyewitness to the robbery and shooting that could allegedly substantiate his innocence. Defendant also informed the court that he had visited the eyewitness at her home on the night of the robbery and shooting, but after the robbery and shooting had occurred. The eyewitness allegedly told defendant the identity of the individual who committed the robbery and shooting. While a remand may be appropriate when newly discovered evidence arises, People v Hernandez, 443 Mich 1, 11; 503 NW2d 629 (1993), no such evidence has been shown to exist here. Defendant’s admission establishes that he knew of the existence of the eyewitness well before trial commenced and failed to come forward with that information. A remand is unwarranted under these circumstances.
vn
Defendant next argues that he is entitled to withdraw his guilty plea regarding the habitual offender charge because the trial court failed to advise him of the maximum possible sentence for the offense as required by MCR 6.302(B)(2). Defendant failed to file a motion to withdraw his plea in the trial court and raises the claim now advanced for the first time on appeal. This failure precludes appellate review. MCR 6.311(C).
vm
Defendant argues that he is entitled to resentencing because the trial court made an independent finding of guilt regarding an arson charge that was dismissed pursuant to the plea agreement in this case, and for which there was no proof of defendant’s guilt, and then sentenced defendant on the basis of that finding. Defendant mischaracterizes the record.
A trial court may not make an independent finding of guilt and then sentence a defendant on the basis of that finding. People v Shavers, 448 Mich 389, 393; 531 NW2d 165 (1995); People v Grimmett, 388 Mich 590, 607-608; 202 NW2d 278 (1972). Our review of the trial court’s sentencing articulation reveals that the court’s reference to the arson charge constituted nothing more than a statement of the fact that the arson charge was about to be dismissed pursuant to the terms of the plea agreement used to secure defendant’s habitual offender conviction. The trial court made no statements during its sentencing articulation from which we can infer that the court made an independent finding of guilt regarding the arson charge and then sentenced defendant as an arsonist.
IX
Defendant further argues that he is entitled to resentencing because the trial court relied on constitutionally infirm and nonexistent prior convictions to score Prior Record Variables 3, 4, and 5. Defendant failed to challenge the scoring of these variables during sentencing and, therefore, failed to create an evidentiary record upon which we can rely to assess the merits of his claims. We decline to grant defendant’s request for a remand. A remand is unnecessary where the record establishes that the sentence was not based on inaccurate information, including invalid convictions. Hernandez, supra at 11, n 13. A remand is unnecessary in this case because the sentencing guidelines do not apply to habitual offender convictions, People v Cervantes, 448 Mich 620, 625 (Riley, J.), 630 (Cavanagh, J.); 532 NW2d 831 (1995), and the trial court did not rely on the guidelines when fashioning defendant’s sentences.
x
Finally, defendant argues that his twenty-five-year minimum sentence violates the principle of proportionality. We disagree. Defendant’s sentence repre sents a proportionate enhancement of his sentence for the underlying armed robbery conviction. Defendant was one of three armed individuals who approached the three victims, ordered them from their vehicle, and ordered them to empty their pockets. One of the victims was shot in the leg while fleeing. Shots were also fired at another victim as he attempted to drive away from the scene, causing the vehicle to swerve and strike a parked vehicle and a tree. Defendant’s criminal history reveals that defendant exhausted all the resources available to him in the juvenile court without being rehabilitated.
Moreover, although defendant was only eighteen years of age at the time of sentencing, his convictions in this case constituted his third and fourth felony convictions; defendant has two prior convictions for drug offenses. The second drug offense was committed approximately three weeks after defendant was sentenced for his first drug offense and the instant armed robbery was committed while defendant was released on bond for the second drug offense. His adult record evidences a rapid progression to violent crime. Likewise, his institutional conduct reflects that defendant is assaultive, contemptuous of authority, and unable to comply with the norms of accepted behavior. Also, defendant’s habitual offender plea in this case was secured by a plea bargain pursuant to which a charge of being a third-offense habitual offender was dismissed and arson and habitual offender charges were dismissed in another criminal action. Defendant’s sentence is entirely proportionate to the seriousness of the offense and the circumstances of the offender. People v Houston, 448 Mich 312; 532 NW2d 508 (1995); People v Milbourn, 435 Mich 630; 461 NW2d 1 (1990).
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Taylor, J.
Plaintiff appeals as of right a declaratory judgment entered after a bench-trial finding that defendant had acquired jurisdiction over certain two-track dirt trails used for vehicular travel in the Pigeon River Country State Forest. We previously stayed the lower court’s judgment pending resolution of this appeal. We now reverse the trial court’s judgment in its entirety and remand.
As explained in Michigan Oil Co v Natural Resources Comm, 406 Mich 1, 16-17; 276 NW2d 141 (1979), the Pigeon River Country State Forest
consists of 92,872 acres of rolling hills, deep swamps, high forests, lakes and streams. Located in Otsego and Cheboygan Counties, the Pigeon River Forest is one of the largest remaining tracts of publicly owned, wild, undeveloped land in the lower peninsula. . . .[The] Pigeon River Forest provides one of the few remaining favorable habitats in the lower peninsula for wildlife, including bear, bobcat, beaver, woodcock, osprey, eagle, and many other birds and animals.
The forest is also the home of the largest remaining elk herd east of the Mississippi River.
The Department of Natural Resources manages the forest pursuant to its statutory powers. On November 2, 1990, the director of the dnr issued an order restricting vehicular travel upon certain dirt trails within the forest. In order to implement this order, the dnr placed barriers on the trails. The system of trails throughout the forest originated as logging trails, railroad grades, and fire breaks. The DNR or its contractors had built approximately fifty-four percent of the trails that were closed during the course of its management of the forest. Defendant did not build or maintain the closed trails, other than Dog Lake Road. See n 1. The trails were closed in order to make the habitat more favorable to the birds and other animals and to protect the forest from overuse and development that might destroy its wild character. Even with the closure of the disputed trails to vehicular traffic, ninety-eight percent of the forest remained within one mile of an open trail.
In November of 1991, defendant dug up and destroyed approximately sixty of the barriers the dnr had erected in Cheboygan County. Plaintiff filed a lawsuit seeking an injunction and damages. Defendant filed a counterclaim asserting jurisdiction over the trails in question.
The trial court determined in an oral opinion that defendant had acquired jurisdiction over the trails in question on the basis of the adverse possession, easement by prescription, dedication and acceptance, and estoppel. The court further found that jurisdiction had been established on the basis of Const 1963, art 7, §§ 29 and 34. As a result of the trial court’s ruling, defendant was “awarded” jurisdiction over 130 to 200 miles of dirt trails within the forest. Plaintiff argues that each of the bases cited by the trial court were inapplicable or unproven. We agree.
We review a trial court’s declaratory judgment de novo. Lake Angelus v Oakland Co Rd Comm, 194 Mich App 220, 223; 486 NW2d 64 (1992). Even when a trial court’s factual findings are not clearly erroneous, this Court will reverse if it disagrees with the trial court’s legal conclusions. Pomranky v Zack Co, 159 Mich App 338, 342; 405 NW2d 881 (1987).
We first deal with the trial court’s determination that the county had, by adverse possession or prescriptive easement, acquired jurisdiction from the state over the trails in question.
This holding is flawed because it confuses acquisition of title with jurisdiction. While adverse possession and prescriptive easement are doctrines that, once successfully asserted, will change title, they cannot affect jurisdiction. Said more simply, title is irrelevant to jurisdiction over a road as between two governmental entities. Indeed, because jurisdiction over a road is not a property right, analysis utilizing adverse possession and prescriptive easement is inapposite. Because it is unrebutted that jurisdiction over the trails in question was with the state before the period of “adverse possession or prescriptive easement” began, the only way jurisdiction could have been transferred from the state was pursuant to MCL 247.851 et seq.; MSA 9.393(31) et seq. (transfer of jurisdiction over highways act), or MCL 250.114; MSA 9.934 (state may abandon portions of a trunk line highway such that jurisdiction would return to a county road commission, township, city, or village; assuming the trails in question can be considered a highway). These two statutes control the transfer of jurisdiction in this circumstance, and because none of the requirements of either statute were met, jurisdiction never passed to the county road commission.
We note also that, even if adverse possession had been a viable theory, it appears highly dubious that one governmental entity may acquire title by adverse possession against another governmental entity. We need not decide this, however, because, even assuming arguendo that a county road commission could acquire title and jurisdiction to a state trail through adverse possession, we find that the public’s use of the trails was not adverse to the state’s ownership and jurisdiction over the trails. The reason is that both the state and the county maintain jurisdictional control over roads for the benefit of the public. Thus, the interests asserted by both parties are not adverse. Graham v Detroit, 174 Mich 538, 543; 140 NW 949 (1913); Bator v Ford Motor Co, 269 Mich 648, 670; 257 NW 906 (1934). Given our finding that adverse possession is inapplicable, and unproven even if applicable, we need not decide if 1988 PA 35, MCL 600.5821; MSA 27A.5821, applies.
The trial court also found a dedication and acceptance relating to the trails. We disagree. A dedication is an appropriation of land to a public use by the owner. Kraus v Gerrish Twp, 205 Mich App 25, 37; 517 NW2d 756 (1994), affirmed in part and modified in part 451 Mich 420; 547 NW2d 870 (1996). Dedication cannot be accomplished without a clear intent to dedicate on the part of the property owner, as well as an acceptance by the public. Id. A dedication and acceptance applies to a private party appropriating land to a public use. Stickley v Sodus Twp, 131 Mich 510, 517; 91 NW 745 (1902). We find that the doctrine of dedication and acceptance is simply inapplicable as between two governmental entities concerning jurisdiction over a road. Here, the trails were already under the jurisdiction of the state. Under such circumstances, no dedication and acceptance could occur.
The trial court also made reference to Michigan’s highway by user statute, MCL 221.20; MSA 9.21, asserting that it, in some fashion, supported the court’s finding that jurisdiction over the trails had been transferred to defendant. Again, it is doubtful that one governmental entity can dedicate a highway to another under this statute. However, assuming arguendo that the state could dedicate a road to a county (independent of the two previously cited statutory methods of transferring jurisdiction of a highway), the proofs did not unequivocally demonstrate such an intent by the state. Boone v Antrim Co Rd Comm’rs, 177 Mich App 688, 693; 442 NW2d 725 (1989). Further, this statute is inapplicable because a highway by user was not established because the trials in question were not worked upon by defendant. Pearl v Torch Lake Twp, 71 Mich App 298, 306-307; 248 NW2d 242 (1976).
The trial court also declared that plaintiff was estopped from denying the right of the public to travel on the roads on the basis of a 1949 deed from the United States and the 1984 edition of the Mapbook of Michigan Counties. We disagree.
The deed did not give defendant any rights in, or jurisdiction over, the trails in question, von Meding v Strahl, 319 Mich 598, 609; 30 NW2d 363 (1948). Sirni laxly, the mapbook also did not give defendant any rights in, or jurisdiction over, the trails in question. Such a situation could not give rise to a valid estoppel claim in the absence of a representation upon which the defendant relied. Schmidt v Bretzlaff, 208 Mich App 376, 378-379; 528 NW2d 760 (1995). That having not happened, the estoppel claim is without merit. Moreover, estoppel as a means of taking title is not favored in Michigan. Miller v Dep’t of State Hwys, 30 Mich App 64, 71; 186 NW2d 67 (1971).
The trial court also declared that defendant had jurisdiction to maintain access to its easements for the benefit of private land owners within the forest. The court’s rationale for this position is unclear, but we are able to dispose of this simply on the basis that this holding is contrary to the evidence presented. There was no evidence that plaintiff was denying private land owners access to their properties. Moreover, it seems a statement of the obvious that what private landowners need is not relevant to what the public has acquired. Regarding the concern that, absent this intervention, easements would be unavailable, we note that MCL 322.612; MSA 13.732(2) authorizes the dnr to grant easements over state-owned land.
The trial court further relied on Const 1963, art 7, §§ 29 and 34 as authority for its declaration that defendant had acquired jurisdiction over the trails in question as a result of long public use. We disagree.
Art 7, § 29 provides in pertinent part as follows:
Except as otherwise provided in this constitution the right of all counties, townships, cities and villages to the reasonable control of their highways, streets, alleys and public places is hereby reserved to such local units of government.
The premise of this section is that, to trigger its applicability, the county, township, city, or village must show that the highway was once “its” highway. This is precisely what was not shown. That should have ended utilization of this section of the constitution, yet the trial court concluded that this section could be somehow read to transfer jurisdiction from the state to the county. We can find no justification for this and conclude it was error. Art 7, § 29 simply does not state that one governmental unit may acquire jurisdiction over another governmental entity’s roads or grant the right to acquire roadway easements other than as provided by law. Arrowhead Development Co v Livingston Co Rd Comm, 413 Mich 505, 512; 322 NW2d 702 (1982).
Art 7, § 34 provides:
The provisions of this constitution and law concerning counties, townships, cities and villages shall be liberally construed in their favor. Powers granted to counties and townships by this constitution and by law shall include those fairly implied and not prohibited by this constitution.
The trial court construed this to confer jurisdiction on the county road commission. This conclusion is misbegotten because this provision is without relevance to the issue the lower court was to address and cannot confer on a county road commission authority that the Legislature did not provide. Arrowhead, supra.
Reversed and remanded for further proceedings, including reconsideration of plaintiff’s complaint in light of, and consistent with, this opinion. We do not retain jurisdiction.
There is no dispute regarding defendant’s jurisdiction over seventy-two miles of certified county roads within the forest. This includes Dog Lake Road, because Michigan Department of Transportation witness Norman Brown testified that Dog Lake Road had been continuously certified since 1954.
See former MCL 299.1 et seq.; MSA 13.1 et seq., MCL 322.203-204; MSA 13.432-433, now superseded by 1994 PA 451, MCL 324.101 et seq.; MSA 13A.101 et seq.
The prevailing view is that this cannot be done. See anno: Acquisition of title to land by adverse possession by state or other governmental unit or agency, 18 ALR3d 678, § 3, pp 684-685. See also Texas v Louisiana, 410 US 702; 93 S Ct 1215; 35 L Ed 2d 646 (1973) (a state may not acquire property from the United States by prescription or acquiescence).
This statute reinstated the common-law rule that one could not acquire title to state-owned property through adverse possession. See Gorte v Dep’t of Transportation, 202 Mich App 161; 507 NW2d 797 (1993). | [
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Per Curiam.
Defendant pleaded guilty of possession with intent to deliver marijuana, MCL 333.7401(2)(c); MSA 14.15(7401)(2)(c), delivery of marijuana, MCL 333.7401(2)(c); MSA 14.15(7401)(2)(c), two counts of delivery of lysergic acid diethylamide (LSD), MCL 333.7401(2)(b); MSA 14.15(7401)(2)(b), and of being a second-offense habitual offender, MCL 769.10; MSA 28.1082. As a result, defendant was sentenced to a term of imprisonment of five to eight years for the marijuana convictions and five to fourteen years for the LSD convictions. He appeals his sentences as of right. We affirm.
Defendant objects to the scoring of Offense Variable (ov) 8 (continuing pattern of criminal behavior) at ten points. Ov 8 requires that ten points be scored when “the offenses are a part of a pattern of criminal activity over a period of time from which the offender derives a substantial portion of his or her income.” The trial court has discretion in determining the number of points to be scored provided there is evidence on the record that adequately supports that particular score. People v Derbeck, 202 Mich App 443, 449; 509 NW2d 534 (1993). Scoring decisions for which there is any evidence in support will be upheld. People v Her nandez, 443 Mich 1, 16; 503 NW2d 629 (1993). In the instant case, it appears that defendant’s four drug felonies occurred over a period of at least six months from December 1993 to June 1994. The only indication of gainful employment by defendant was his assertion that he “supported himself with help from his mother in mowing lawns during the summer.” There is no indication of any employment on defendant’s part during the period when his criminal activities occurred. We believe that the trial court can make reasonable inferences concerning the profitability of the drug trade sufficient to sustain its scoring of ov 8. We find no abuse of discretion on the trial court’s part in scoring ov 8 at ten points under these circumstances.
Defendant next contends that an error was made in the calculation of his guideline range based upon the trial court’s scoring of ov 16 (aggravated controlled substance offense). Defendant’s guideline range was calculated by the court at d-iv (twenty-four to fifty-six months). However, the correct guideline range based upon the trial court’s own factual and legal determinations was D-m (eighteen to forty-eight months). Although the court stated on the record that defendant was entitled to be scored zero points for ov 16, the Sentencing Information Report and defendant’s guideline range reflect the originally proposed scoring of fifteen points. Defendant was sentenced to a term of imprisonment four months above the incorrect guideline range and twelve months above the correct guideline range.
While the guidelines do not apply to habitual offenders, People v Finstrom, 186 Mich App 342, 345-346; 463 NW2d 272 (1990), defendant argues that they do serve as a “starting point” in sentencing such individuals. People v Gatewood, 214 Mich App 211, 212; 542 NW2d 605 (1995). However, the Michigan Supreme Court recently held that the Gatewood Court erred in finding this relationship between the guidelines and habitual offender sentences. People v Gatewood, 450 Mich 1021 (1996). Rather, “a majority of the Supreme Court agreed [in People v Cervantes, 448 Mich 620; 532 NW2d 831 (1995)] that appellate review of habitual offender sentences using the sentencing guidelines is inappropriate.” Gatewood, supra. We infer from this statement that, if appellate consideration of the guidelines in such circumstances is “inappropriate,” there concomitantly is no obligation upon the trial court to take the guidelines into consideration in its sentencing determinations for habitual offenders. This inference is bolstered by our reading of Cervantes. In Cervantes, three members of the Supreme Court (Justice Riley joined by Justices Mallett and Weaver) observed:
[T]he sentencing guidelines do not apply to habitual offenders. . . . There was no consideration of habitual offender sentencing in the creation of the existing guidelines; therefore, it would be both misleading and statistically invalid to attempt in any way to apply the existing guidelines to the sentencing of habitual offenders. Further, to hold that the sentencing guidelines have any effect on the sentencing of habitual offenders would preempt the Legislature’s development of guidelines that will specifically address habitual offender sentences. [Id. at 625-626.]
Concurring in the results in Cervantes, a fourth member of the Court, Justice Boyle, stated:
If the Court were free to create an appellate standard of sentencing review in such cases, the standard articulated in Justice Riley’s opinion would be appropriate.
I cannot, however, join in Justice Riley’s effort, because of my continuing belief that the allowance of appellate review of statutorily valid sentences constitutes an unconstitutional incursion into the sentencing discretion delegated in this instance by the Legislature to trial judges. [Id. at 637.]
On the basis of the order in Gatewood, we conclude that the trial court did not err in failing to consider the correct guideline range before imposing sentence upon defendant. People v Gatewood (On Remand), 216 Mich App 559; 550 NW2d 265 (1996). While nothing in the law would preclude a trial court from taking the sentencing guidelines into consideration in the course of determining a sentence for an habitual offender, such consideration is not obligatory as a “starting point,” as a “reference point,” or otherwise. Nevertheless, it may still be a potentially useful tool in deriving a “proportionate” sentence for the habitual offender. People v Milbourn, 435 Mich 630; 461 NW2d 1 (1990).
We further conclude that defendant’s sentences are not disproportionate under Milboum. Defendant has raised no arguments in support of such a proposition other than that the court erred in its calculation of defendant’s sentencing guidelines.
Affirmed.
However, we do believe that the guidelines must continue to be calculated even though they do not need to be taken into consideration in the sentencing determination. Section B.3 of the General Instructions to the Michigan Sentencing Guidelines provides that “Even though the Sentencing Guidelines do not apply where an offender is to be sentenced as an habitual offender, the judge must complete the sir on the underlying offense. This information will aid in the development of guidelines to cover habitual offenders.” See also People v Zinn, 217 Mich App 340; 551 NW2d 704 (1996). | [
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Per Curiam.
Defendant conditionally pleaded guilty in the district court of operating a vehicle while under the influence of liquor (OUIL), MCL 257.625(1); MSA 9.2325(1). He was sentenced to twenty-five days’ incarceration and eighteen months’ probation. The district court left the decision regarding revocation of defendant’s operator’s license with the Secretary of State. Defendant appeals by leave granted from the order of the Grand Traverse Circuit Court affirming the district court’s denial of his motion to quash. We affirm in part and reverse in part.
Defendant had been convicted of ouil on August 7, 1986. On July 18, 1993, defendant was arrested and charged with ouil. Defendant entered a plea of guilty of OUIL on September 20, 1993, conditioned on his right to appeal the district court’s determination that he was subject to enhanced penalties and licensing sanctions for that offense. Following the unsuccessful interlocutory appeal in the circuit court, defendant was sentenced on November 3, 1994, under the sentence enhancement provision of MCL 257.625(6)(b); MSA 9.2325(6)(b) , and the license revocation provi sion of MCL 257.625b(5)(b)(iii); MSA 9.2325(2)(5)(b) (iii).
i
At the time of defendant’s arrest and conviction, MCL 257.625(6); MSA 9.2325(6) provided in pertinent part:
If a person is convicted of violating subsection (1), the following shall apply:
* * *
(b) If the violation occurs within 7 years of a prior conviction, the person shall be sentenced to both a fine of not less than $200.00 or more than $1,000.00 and either of the following:
Performing service to the community for a period of not less than 10 days or more than 90 days and may be imprisoned for not more than 1 year.
Imprisonment for not less than 48 consecutive hours or more than 1 year, and may be sentenced to service to the community for a period of not more than 90 days.
At issue in this case is the meaning of the word “violation.” Defendant contends that the word “violation” is synonymous with the word “conviction” and that the Legislature’s intent was to enhance a sentence when a conviction occurs within seven years of a prior conviction.
The primary goal of statutory construction is to find and give effect to the Legislature’s intent. People v Stanaway, 446 Mich 643, 658; 521 NW2d 557 (1994). To ascertain that intent, this Court must first turn to the language contained within the challenged statutory provision. People v Williams, 205 Mich App 229, 232-233; 517 NW2d 315 (1994). If the language is clear and unambiguous, statutory construction by this Court is precluded. People v Armstrong, 212 Mich App 121, 123; 536 NW2d 789 (1995).
In the present case, the statute is clear and unambiguous, but “violation” is not defined. Where a statute does not define one of its terms it is customary to look to the dictionary for a definition. See Energetics, Ltd v Whitmill, 442 Mich 38, 45; 497 NW2d 497 (1993). Random House Webster’s College Dictionary defines “violation” as:
1. the act of violating or the state of being violated. 2. a breach or infringement, as of a law or promise. 3. a sexual assault. 4. desecration; profanation. 5. a distortion of meaning or fact.
Review of this common definition clearly indicates the plain meaning of the statute is that a sentence for an ouil conviction must be enhanced if the ouil statute was violated within seven years of a prior OUIL conviction. Consequently, the law must be applied as written. People v Cannon, 206 Mich App 653, 655; 522 NW2d 716 (1994). Because defendant committed the present ouil offense within seven years of a prior ouil conviction, the trial court correctly enhanced defendant’s sentence under § 625(6)(b).
n
At the time of defendant’s arrest and conviction, MCL 257.625b(5)(b)(iii); MSA 9.2325(2)(5)(b)(iii) provided:
Immediately upon acceptance by the court of a plea of guilty or nolo contendere or upon entry of a verdict of guilty for a violation of section 625(1), (3), (4), or (5) or a local ordinance substantially corresponding to section 625(1) or (3), whether or not the person is eligible to be sentenced as a multiple offender, the court shall consider all prior convictions currently entered upon the Michigan driving record of the person, except those convictions which upon motion by the defendant, are determined by the court to be constitutionally invalid, and shall impose the following sanctions:
* *
For a conviction under section 625(1) or a local ordinance substantially corresponding to section 625(1):
* :|: *
If the court finds that the person has 1 or more prior convictions within 7 years for a violation of section 625(1) . . . , the court shall order the secretary of state to revoke the operator’s or chauffeur’s license of the person and shall not order the secretary of state to issue a restricted license to the person. [Emphasis added.]
The glossary for the Vehicle Code defines conviction as
a final conviction, the payment of a fine, a plea of guilty or nolo contendere if accepted by the court, or a finding of guilt or probate court order of disposition of a child found to be within the provisions of chapter XHA of Act No. 288 of the Public Acts of 1939, being sections 712A.1 to 712A.28 of the Michigan Compiled Laws, on a traffic law violation charge, regardless of whether the penalty is rebated or suspended. [MCL 257.8a; MSA 9.1808(l). ]
The term “conviction” must be applied as expressly defined. People v Chupp, 200 Mich App 45, 49; 503 NW2d 698 (1993). Thus, the plain meaning of the statute is that when a defendant pleads guilty of OUIL and stands convicted of that offense, the trial court must look to all the defendant’s prior convictions to determine whether any occurred within seven years of the date upon which defendant was convicted, and, if there is a prior conviction for ouil within that seven-year period, the trial court must order the Secretary of State to revoke the defendant’s operator’s license. This interpretation is consistent with MCL 257.303(2)(c); MSA 9.2003(2)(c), which mandates that the Secretary of State revoke a person’s operator’s license if the person’s driving record contains two OUIL convictions within a seven-year period.
Here, there is no dispute that defendant’s first conviction occurred on August 7, 1986, and that the present conviction occurred on September 20, 1993. Under these facts, neither the trial court nor the Secretary of State had authority to revoke defendant’s operator’s license.
Affirmed in part and reversed in part.
After its amendment by 1991 PA 98, effective July 31, 1991, but before its amendment by 1994 PA 211, effective November 1, 1994.
After its amendment by 1991 PA 93, effective July 31, 1991, but before its amendment by 1994 PA 211, effective November 1, 1994. See now MCL 257.625b(6)(b)(iii); MSA 9.2325(2)(6)(b)(in).
After its amendment by 1991 PA 99, effective January 1, 1992, but before its amendment by 1994 PA 449, effective May 1, 1995. | [
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Corrigan, P.J.
In this products liability action tried in the district court, defendants appeal by leave granted a circuit court order affirming the district court order denying their motion for costs and attorney fees under MCR 2.405. Plaintiff cross appeals the circuit court order affirming the grant of defendants’ motion for a directed verdict. We hold as a matter of first impression that offer of judgment sanctions are available under MCR 2.405 where the court directs a verdict of no cause of action. We reverse the order denying costs and attorney fees and remand for further proceedings consistent with this opinion. We affirm the grant of the directed verdict.
I. underlying facts and procedural history
On November 13, 1990, Marie Love, an employee of Trebur Property, Incorporated, drove to work in a Chevrolet S-10 pickup truck owned by Trebur and insured by plaintiff Auto Club Insurance Association. As Love drove, a driver nearby gestured that she should pull over. Although Love saw smoke, she thought it was coming from that driver’s car. She continued to drive. About fifteen minutes later, a woman banged on the truck window and told Love that the truck was afire. After Love left the truck, she noticed flames coming from the left front of the truck.
Love had purchased the new truck seven months earlier on Trebur’s behalf. Aside from an oil change, no maintenance had been performed on the truck, no repairs had been done, and the truck had not been involved in any accidents. Love had, however, experienced a problem with the steering: the truck pulled to the left side. On the day of the fire, Love had trouble steering, and the truck shook.
Damage to the truck totaled $8,008, which plaintiff Auto Club paid to its insured. In June 1991, Auto Club, as subrogee, brought a products liability action against defendants General Motors Corporation and Merollis Chevrolet, claiming that a design defect in the fuel system of the truck directly and proximately caused the fire. In June 1992, a mediation panel released its recommendation. Plaintiff rejected the recommendation and defendants accepted it. Defendants then made an offer of judgment of $1,000, in May 1993, which Auto Club did not accept.
In July 1993, the district court conducted a jury trial. At the close of plaintiff’s case, defendants moved for a directed verdict, which the court granted. Defendants later moved for offer of judgment sanctions and costs; the court denied the motion. The district court reasoned that sanctions were unavailable because the directed verdict resulted from a motion. The circuit court agreed with this reasoning and affirmed the district court’s rulings in May 1994. Defendants now appeal by leave granted the circuit court order affirming the district court order denying offer of judgment sanctions; plaintiff cross appeals the circuit court’order affirming the district court’s decision to grant defendants’ directed verdict motion.
II. ATTORNEY FEES AND COSTS UNDER MCR 2.405, THE OFFER OF JUDGMENT RULE
Defendants first assert that the circuit court erred in affirming the denial of costs and attorney fees under the offer of judgment rule, MCR 2.405. Defendants claim that both the district court and the circuit court erred in interpreting the offer of judgment court rule. The interpretation of court rules is a question of law. Richmond Twp v Erbes, 195 Mich App 210, 224; 489 NW2d 504 (1992); Smeets v Genesee Co Clerk, 193 Mich App 628, 633; 484 NW2d 770 (1992). We review questions of law under the de novo standard. Rapistan Corp v Michaels, 203 Mich App 301, 306; 511 NW2d 918 (1994).
The purpose of MCR 2.405 is “to encourage settlement and to deter protracted litigation.” Sanders v Monical Machinery Co, 163 Mich App 689, 692; 415 NW2d 276 (1987). Accordingly, costs under the offer of judgment court rule are awarded as follows:
(D) Imposition of Costs Following Rejection of Offer. If an offer is rejected, costs are payable as follows:
(1) If the adjusted verdict is more favorable to the offeror than the average offer, the offeree must pay to the offeror the offeror’s actual costs incurred in the prosecution or defense of the action. [MCR 2.405.]
Under the court rule, an “adjusted verdict” is “the verdict plus interest and costs from the filing of the complaint through the date of the offer.” MCR 2.405(A)(5). The court rule defines “verdict” as “the award rendered by a jury or by the court sitting without a jury, excluding all costs and interest.” MCR 2.405(A)(4).
The issue presented is whether a directed verdict falls within the definition of a “verdict” under MCR 2.405. The present rule does not specifically identify a directed verdict granted upon a motion as a “verdict.” Nonetheless, we conclude that a directed verdict is a verdict for purposes of MCR 2.405(A)(4). In 1991, our Supreme Court grappled with the definition of “verdict” under MCR 2.405 in Freeman v Consumers Power Co, 437 Mich 514; 473 NW2d 63 (1991). The trial court had granted the defendants’ motion for summary disposition under MCR 2.116, and the defendants asked for costs and fees under MCR 2.405. The plaintiffs contended that a grant of summary disposition did not fall within the definition of a verdict under that court rale. The defendants argued that, because the definition of verdict under MCR 2.403, the mediation court rule, included a judgment on a ruling, the Court should interpret MCR 2.405 as similarly inclusive.
The Court concluded that the definition of a verdict under MCR 2.405 was not interchangeable with that under MCR 2.403. The Court noted that the definitions of verdict in the rales were “precisely worded” and “clear,” adding that “there is no sound reason to employ one rule’s definition in the application of the other rule.” Freeman, at 519. The Court also stated that the potential for abuse was greater under MCR 2.405 because, rather than a panel of uninvolved arbi trators, the parties themselves formulated the offers to settle. Id. at 519, n 8. We note, however, that the trial court has discretion whether to award attorney fees under the offer of judgment rule. MCR 2.405(D)(3).
This Court has also held that a verdict under MCR 2.405 does not include a judgment entered as a result of a ruling on a motion under MCR 2.116. In Parkhurst Homes, Inc v McLaughlin, 187 Mich App 357, 364-366; 466 NW2d 404 (1991), this Court decided that the trial court erred in assessing costs after granting a motion for summary disposition. This Court compared MCR 2.405 with MCR 2.403, noting that our Supreme Court had not modified MCR 2.405 to expand the definition of verdict to include judgments entered as a result of rulings on motions as it had in MCR 2.403. This Court stated that if a party decides to reject the mediation evaluation, it does so “with an apparently meaningful understanding of both the merits and potential value of its claim.” Under those circumstances, the Court explained, it was not unjust to impose sanctions against a rejecting party. Id. at 364-365.
In contrast, offers under MCR 2.405 may be made earlier in the proceedings, even before discovery. Also, the amount of the offer is subject to the discretion of the offeror, unlike mediation. Thus, the potential for abuse is greater, because the offeror could make a minimal offer early in a case with the intention of later securing costs and fees under the court rule. Parkhurst at 365. Likewise, in Zantop Int’l Airlines, Inc v Eastern Airlines, 200 Mich App 344; 503 NW2d 915 (1993), the trial court defaulted Zantop and dismissed its claims against two of the defendants because Zantop’s counsel had violated a court order in limine restricting a certain line of questioning. Id. at 350. This Court, relying on Parkhurst, held that no “verdict” under MCR 2.405 had resulted because the case was dismissed after a motion. Zantop at 366.
The cited cases are distinguishable from this case. No published case has considered offer of judgment sanctions after the grant of a directed verdict; instead, the authorities have construed dispositive motions under MCR 2.116 and motions for orders of dismissal and defaults as sanctions for attorney misbehavior. A defendant in Parkhurst brought a motion for summary disposition just five months after the case commenced. In this case, over two years had passed and the case had proceeded to trial when defendants moved for a directed verdict. Moreover, a motion for summary disposition cannot be equated with a motion for a directed verdict. A motion for a directed verdict is brought after discovery has been conducted, after a jury has been impaneled, and after the plaintiff has presented proofs. Also, a court grants a motion for a directed verdict under a different standard from that of a summary disposition motion. A directed verdict arises under MCR 2.515, while summary disposition occurs under MCR 2.116. In essence, a directed verdict for the defendant technically orders the jury to find no cause of action. A court grants a directed verdict when the evidence does not establish a prima facie case and reasonable persons would agree that there is an essential failure of proof. Zander v Ogihara Corp, 213 Mich App 438, 441; 540 NW2d 702 (1995). Although the standards are similar, a motion for summary disposition is typically made before trial and decided on documentary evidence, while a directed verdict motion is made at trial on the admitted evidence. Skinner v Square D Co, 445 Mich 153, 179; 516 NW2d 475 (1994) (Levin, J., dissenting). In this case, the court’s act of directing the verdict recognized that no rational jury, as a matter of law, could render a verdict for plaintiff because the evidence was so weak.
Additionally, other statutes and rules are available to prevailing parties, see Parkhurst, supra; however, those statutes and rules — MCL 600.2591; MSA 27A.2591; MCR 2.109, 2.114(F), 2.625(A)(1) — do not help these defendants. They permit costs for frivolous claims, an issue not present here. Also, they do not include attorney fees. Therefore, prevailing parties who make offers of judgment and then seek attorney fees and costs where the claim is not frivolous must rely on MCR 2.405.
Further, the Supreme Court Mediation Rule Committee has proposed an amendment of the court rule to include the following definitions of verdict: “(a) a jury verdict, (b) a judgment by the court after a non-jury trial, (c) a judgment entered as a result of a ruling on a motion after rejection of the offer of judgment.” See Report of Supreme Court Mediation Rule Committee, December 15, 1995, contained at 451 Mich 1205, 1230-1231. Our Supreme Court has released the committee’s report and proposed rule changes for notice and comment. In the commentary on the above proposal, the committee noted that the mediation rule was amended in 1987 to include such a definition of verdict, but the offer of judgment rule was not so amended. The committee wrote “there was no reason for the two rules to be different on this point.” Id. at 1231.
We agree with the above commentary. The grant of attorney fees and costs under MCR 2.405 after a directed verdict would avoid situations where each party gambles that it might prevail at trial and thereby evade the rule. See Hamilton v Becker Orthopedic Appliance Co, 214 Mich App 593, 594; 543 NW2d 60 (1995). When the purpose of the rule is to encourage the parties to settle before trial, the rule would not be served by withholding costs to the prevailing party after trial has actually commenced and the trial court enters a directed verdict.
Plaintiff contends that this Court should award it sanctions against defendants for bringing a vexatious appeal. Because defendants’ appeal raised a meritorious issue, MCR 7.216(C), sanctions are not warranted.
m. DIRECTED VERDICT ON PRODUCTS LIABILITY CLAIM
On cross appeal, plaintiff argues that the circuit court erred in affirming the district court’s grant of defendants’ motion for a directed verdict because plaintiff established a prima facie case of products liability. In deciding a motion for a directed verdict, the court examines all the evidence presented up to the time of the motion to determine whether a question of fact exists. Hatfield v St Mary’s Medical Center, 211 Mich App 321, 325; 535 NW2d 272 (1995). The testimony and all legitimate inferences that may be drawn from that testimony are viewed in a light most favorable to the nonmoving party. Id. In a products liability action, if the evidence and all available reasonable inferences create a prima facie case, the court must deny the motion. Kupkowski v Avis Ford, Inc, 395 Mich 155, 160-161; 235 NW2d 324 (1975).
Plaintiff did not establish a prima facie case of products liability. A plaintiff bringing a products liability action must show that the defendant supplied a product that was defective and that the defect caused the injury. Snider v Bob Thibodeau Ford, Inc, 42 Mich App 708, 713; 202 NW2d 727 (1972). The plaintiff may establish its case by circumstantial and direct evidence. Kupkowski, supra at 166. The plaintiff meets this burden when it demonstrates, by a reasonable probability, that the defect is attributable to the manufacturer and that such hypothesis is more probable than any other hypothesis reflected by the evidence. Skinner, supra. The plaintiff, however, is not obliged to eliminate all possible causes of the accident. Holloway v General Motors Corp (On Rehearing), 403 Mich 614, 621; 271 NW2d 777 (1978).
A court must determine whether it is reasonable to infer from the evidence that the accident was probably caused by the design defect. Id. at 622. The causation theory must have some basis in established fact, and is insufficient if it is, at best, just as possible as another theory. Skinner, supra at 164. The plaintiff must produce substantial evidence from which a jury may conclude that more likely than not, but for the defendant’s conduct, the plaintiff’s injuries would not have occurred. Id. at 164-165. When the cause remains one of pure speculation or conjecture, or the probabilities are evenly balanced, the court must direct a verdict for the defendant. Id. at 165.
Plaintiffs expert opined that the fire originated within the engine compartment as a result of the truck’s defective fuel line. Plaintiff’s expert testified, however, that he could not say that the truck was defective in any way. Rather, he reached his opinion regarding the fire’s origin by a process of elimination. Love had seen white smoke; the expert said that the cause of the smoke was a gas leak, which sprayed gas oxidized off the exhaust. Plaintiff’s expert said that the fire was not caused by an underinflated or flat tire, defendants’ causation theory, because Love said that she had not driven on a flat tire. He stated that damage to the wheel rim possibly occurred when the truck was towed.
In contrast, defendants’ expert (who was called by plaintiff as an adverse witness) testified that the cause of the fire was Love’s continuing to drive on an underinflated or flat tire, which can self-ignite. Defendants’ expert testified that the fire was not caused by the fuel system because the bum pattern was inappropriate. Also, if the track had a fuel leak, Love would have noticed a gasoline odor, puddles of gasoline, and poor fuel economy. Had fire consumed the fuel lines, as plaintiff’s expert suggested, Love could not have driven it the additional fifteen minutes after noticing the smoke.
Plaintiff did not establish substantial evidence from which a jury could conclude, more likely than not, that but for defendants’ conduct, the truck would not have burned. Plaintiff’s expert stated that he could not say that the truck was defective in any way. Plain tiffs expert did not demonstrate a causal connection between a design defect and the fire. Because the probabilities of plaintiffs and defendants’ theories were evenly balanced, any conclusion from the jury would have been pure speculation or conjecture. Plaintiff’s expert did not demonstrate by a reasonable probability that a defect in the fuel line, which would be attributable to defendants, was more probable than any other theory of the fire’s cause.
Reversed and remanded as to the order denying costs and attorney fees; the order affirming the grant of the directed verdict is affirmed. We do not retain jurisdiction.
The relationship between mediation and offers of judgment has been controversial. Indeed, the Mediation Rule Committee appointed by our Supreme Court concluded in its report of December 15, 1995, that “the offer of judgment rule undermines the mediation process and that steps should be taken to eliminate that effect.” The committee recommended that “MCR 2.405(E) be amended to make offer of judgment sanctions inapplicable to cases that have been mediated, unless the mediation evaluation was not unanimous.” See 451 Mich 1206. | [
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White, J.
Plaintiff appeals as of right the circuit court’s grant of summary disposition for defendants Home Insurance Company (Home) and Great American Insurance Company (Great American) pursuant to MCR 2.116(C)(10).* The circuit court dismissed plaintiff’s complaint for a declaratory judgment, which alleged that defendants had a duty to defend and indemnify it in connection with any action that might be taken by the Michigan Department of Natural Resources (dnr) pertinent to the cleanup of plaintiffs landfill. We affirm in part and reverse in part.
i
This case involves interpretation and application of pollution exclusion clauses and a personal injury endorsement in insurance policies plaintiff purchased applicable to its solid waste landfill in Sparta Township. Plaintiff operated the Sparta landfill from approximately 1972 until October 1978. It stopped burying waste at the landfill in June 1977, and from that time until October 1978 the site was used only as a transfer station.
Plaintiff filed an action for a declaratory judgment against Home in April 1985. Plaintiff alleged that on March 8, 1983, the DNR claimed plaintiff was in violation of 1929 PA 245 and required that remedial action be taken to halt the flow of contaminants from the Sparta landfill into the groundwater. Plaintiff further alleged that, although Home had defended it against claims by individual neighboring landowners and entered into settlements with those landowners for contamination of their groundwater aquifers, it acted in bad faith by waiting more than eighteen months to respond to and deny claims regarding the DNR action. Plaintiff alleged coverage under both the comprehensive general liability policies (primary policies) and excess liability policies issued by Home. Home’s answer raised affirmative defenses, including defenses based on the pollution exclusion clauses contained in its policies.
Home’s primary policies, which were in effect from January 24, 1975, to January 1, 1982, contained the following exclusion:
This policy does not apply:
Q) to bodily injury or property damage arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any water course or body of water; but this exclusion does not apply if such discharge, dispersal, release or escape is neither expected nor intended by the Insured;
Home’s excess liability policies, which were effective from January 15, 1976, to January 15, 1980, contained a different exclusion:
It is agreed that such insurance as is afforded by this policy does not apply to Personal Injury or Property Damage arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any water course or body of water; but this exclusion does not apply if such discharge, dispersal, release or escape is sudden and accidental.
Home’s primary policies contained a personal injury liability endorsement providing in pertinent part:
This Company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of injury (herein called “personal injury”) arising out of one or more of the following offenses:
Group A-false arrest, detention or imprisonment, or malicious prosecution;
Group B-the publication or utterance of a libel or slander or of other defamatory or disparaging material, or a publication or utterance in violation of an individual’s right of privacy; except publications or utterances in the course of or related to advertising, broadcasting or telecasting activities conducted by or on behalf of the Named Insured;
Group C-wrongful entry or eviction, or other invasion of the right of private occupancy; if such offense is committed during the policy period within the United States of America, its territories or possessions, or Canada, and this Company shall have the right and duty to defend any suit against the Insured seeking damages on account of such personal injury even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but this Company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of this Company’s liability has been exhausted by payment of judgments or settlements.
Great American was added as a necessary party in January 1988 and was required to answer plaintiffs amended complaint. Great American issued a general liability insurance policy to plaintiff covering from July 24, 1972, to July 24, 1975. Great American’s affirmative defenses included reliance on its pollution exclusion clause, which stated:
It is agreed that the insurance does not apply to bodily injury or property damage arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants and pollutants into or upon the land, the atmosphere, or any watercourse or body of water; but this exclusion does not apply if such discharge, dispersal, release or escape is sudden and accidental.
In June 1992, Home moved for summary disposition pursuant to MCR 2.116(C)(10), arguing there was no issue of fact that the pollution exclusion clauses of its policies excluded coverage. Home argued the land fill was located in an area of highly permeable sand and gravel with the water table approximately ten feet below the surface. Home argued that there was no barrier between the soil and refuse, and that the municipal trash and some industrial sludge was deposited directly onto the land.
Great American moved for summary disposition, arguing its policies did not afford coverage because the contamination was not sudden and accidental and that its policy period ended before the “occurrence” in this case.
The facts viewed in a light most favorable to plaintiff are that at the time the Sparta landfill began operating, it was a state of the art facility licensed to receive solid waste only. Operation of the landfill was part of a plan to eliminate twenty- nine open dumps in the county. Solid waste materials were deposited daily, covered throughout the day, and covered with six inches of dirt each night.
The landfill was not artificially lined. Rather, a seven-foot soil barrier separated the bottom of the landfill from groundwater. Plaintiff argued that at the time the landfill was engineered it was believed its design was sufficient to contain the solid waste and that it was “not an unlined pit or seepage lagoon,” as asserted by Home.
When the landfill reached its capacity in 1977, it was closed. No complaints were received regarding the Sparta landfill during its operation. Approximately two years after the landfill closed, plaintiff began receiving complaints from neighbors of the landfill regarding their well water.
In response to Home’s motion, plaintiff argued that before the applicability of the pollution exclusion clauses could be determined, two factual issues required resolution: whether plaintiff intended to contain the waste within the landfill and whether the landfill was in fact the contributing source of the contamination. Plaintiff argued that William Iverson, an employee of the dnr, testified in a deposition that he could not attribute the contamination just to the Sparta landfill. Plaintiff also argued that coverage should be afforded under Home’s personal injury liability endorsement, quoted earlier.
Home’s reply brief argued that plaintiff’s “state of the art” and source of contamination arguments were irrelevant because the key factual inquiry was whether plaintiff expected and intended to initially discharge the waste into or upon the land. Home argued that the personal injury coverage did not apply to governmental site-remediation claims.
The trial court’s opinion and order granting defendants’ motions set forth a chronological account of the events pertinent to this case, which is not disputed:
In April of 1979 homeowners, directly across the street from the Sparta Landfill, filed a complaint with the Kent County Health Department regarding the quality of water from their private residential well. An employee of the Kent County Health Department visited the property on April 18, 1979, and recommended that the Andersons (the homeowners) contact the Michigan Department of Natural Resources. On May 25, 1979 the Andersons were advised not to drink their well water. In a memorandum dated May 30, 1979 the Michigan Department of Natural Resources identified the closed Sparta Landfill as the “probable source” of the contamination. In June and July of 1979, the MDNR collected water samples from domestic wells in the immediate vicinity of the landfill and from some on-site monitoring wells to determine the extent of the contamination. In a letter dated August 28, 1979 the mdnr again reiterated that the most probable source of the adverse impact on the ground water in this area was the closed Sparta Landfill.
On August 28, 1979 the County was directed by the MDNR to undertake certain corrective actions. The County, in response to that directive, did install two deep wells at homes which were across the street from the Sparta Landfill but refused to comply with any other of the directives of the mdnr and instead took the position, that since the landfill had been closed with the knowledge and approval of the mdnr, and since the County had complied -with all regulation^] in existence at the time the landfill was closed, any further investigation and effort would have to be at the expense of the State. The mdnr subsequently conducted a hydrogeological investigation of the Sparta Landfill between January 1981 and November of 1982. On March 8, 1983 the mdnr wrote to the County advising that the hydrogeological study of the closed Sparta Landfill had been completed. A copy of the report was forwarded to the County. The mdnr letter reported that the results of the study and data obtained from the Kent County Health Department show that the landfill was the source of the “organic chemicals and other contaminates which had been detected in samples from monitoring wells, and which had rendered water in the private wells [of] four nearby residents unfit for consumption.” The March 8, 1983 letter also informed the County that the contamination of the ground water resulting from the landfill was a violation of Act 245, PA 1929 and that the matter had been referred to the [mdnr’s] Enforcement Division. Notwithstanding the March 8, 1983 letter, the County has not conducted any remediation of the closed Sparta Landfill nor [sic], to the best of the Court’s knowledge, has the mdnr taken any further steps.
The circuit court granted defendants’ motions for summary disposition, applying the “initial discharge” rule of Protective Nat’l Ins Co of Omaha v Woodhaven, 438 Mich 154; 476 NW2d 374 (1991). The court reasoned that plaintiff intentionally placed the waste in the ground and that the fact that toxic material thereafter migrated to neighboring wells was irrelevant to the application of the pollution exclusion under Woodhaven, because it is the initial discharge or dispersal of waste that triggers the exception to the pollution exclusion. The trial court concluded there was no genuine issue of material fact regarding the source of contamination, because there was no other known or identified source. The same reasoning was applied in granting Great American’s motion for summary disposition.
The circuit court subsequently denied plaintiff’s motion for reconsideration, in which plaintiff again argued that a factual dispute remained regarding the source of contamination and that the court had not addressed whether there was coverage under Home’s primary policies’ personal injury liability endorsement. The circuit court found no coverage was afforded plaintiff under the personal injury liability endorsement, and further found that plaintiff’s claim against Great American was barred because there was no manifestation of damage or injury during the period of coverage.
n
We review de novo the circuit court’s grant of summary disposition pursuant to MCR 2.116(C)(10). Borman v State Farm Fire & Casualty Co, 198 Mich App 675, 678; 499 NW2d 419 (1993), aff’d 446 Mich 482; 521 NW2d 266 (1994). In ruling on the motion, the trial court must consider the pleadings and any depositions, affidavits, admissions, or other documentary evidence submitted by the parties. MCR 2.116(G)(5). The test is whether the kind of record that might be developed, giving the benefit of any reasonable doubt to the nonmoving party, would leave open an issue upon which reasonable minds might differ. Kivela v Dep’t of Treasury, 200 Mich App 545; 505 NW2d 11 (1993), rev’d on other grounds 449 Mich 220; 536 NW2d 498 (1995). The party opposing the motion must show that a genuine issue of disputed fact exists. Tope v Howe, 179 Mich App 91; 445 NW2d 452 (1989).
Plaintiff first argues that summary disposition was inappropriate because a genuine issue of material fact remained regarding the source of contamination found by the dnr. We disagree. The dnr’s hydrogeological study, as described in its March 8, 1983, letter to plaintiff, states that the “study and data obtained from the Kent County Health Department show conclusively that the landfill is the source of the organic chemicals and other contaminants which have been detected in samples from monitoring wells, and which have rendered water in the private wells at four nearby residences unfit for consumption.” Defendants relied on this study in seeking summary disposition. Plaintiff states in its appellate brief that no further determinations regarding other sources of contamination have been made. Although the deposition testimony plaintiff relies on suggests that there may have been additional sources of contamination of the wells, it does not refute that some contamination came from the Sparta landfill. Further, the alternative theories of the source of the pollution proffered by plaintiff do not support a claim for which there would be coverage under the policies. Under these circumstances, we conclude the trial court did not err in concluding that no genuine issue of material fact remained with regard to this issue.
m
Plaintiff next argues that because the Sparta landfill was designed to contain waste materials and contaminants, the initial placement of the waste in the landfill cannot be used to trigger the pollution exclusion clauses. Plaintiff argues the appropriate focus should be on the discharge or release of contaminants from the landfill into the general environment, and not the initial placement of waste into the landfill.
Whether we consider the relevant discharge to be plaintiffs initial placement of the municipal waste in the landfill, or the subsequent discharge of pollutants into the groundwater, summary disposition was properly granted with regard to the policies with pollution exclusion clauses containing the “sudden and accidental” exception, i.e., Great American’s policy and the Home excess policies. Two of three companion cases in which the Supreme Court interpreted pollution exclusion clauses held that the “sudden and accidental” language in those policies was unambiguous. Upjohn Co v New Hampshire Ins Co, 438 Mich 197, 208; 476 NW2d 392 (1991); Woodhaven, supra, 438 Mich 167. Subsequently, the Court in Auto-Owners Ins Co v City of Clare, 446 Mich 1, 12-13; 521 NW2d 480 (1994), quoting Upjohn at 207, again found that the “sudden and accidental” language in the insurer’s pollution exclusion clause was unambiguous:
“[W]hen considered in its plain and easily understood sense, ‘sudden’ is defined with a ‘temporal element that joins together conceptually the immediate and the unexpected.’ The common, everyday understanding of the term ‘sudden’ is ‘ “happening, coming, made or done quickly, without warning or unexpectedly; abrupt.” ’ “ [Citations omitted.]
The “sudden and accidental” exception to the pollution exclusion clauses is not triggered here because there was no evidence that either plaintiffs initial placement of municipal waste in the landfill or the subsequent contamination of the groundwater had the temporal element required, i.e., was immediate, abrupt, or occurred quickly. Thus, the trial court did not err in concluding Great American had no duty to defend or indemnify plaintiff and properly granted summary disposition for Great American. The same applies to the Home policies containing pollution exclusion clauses with “sudden and accidental” exceptions, i.e., the four excess policies.
We decline to address plaintiffs argument that these policies’ pollution exclusion clauses contain a latent ambiguity and that we should consider the drafting history of the pollution exclusion, because a majority of the Supreme Court in Upjohn rejected this approach. 438 Mich 205-206, n 6.
rv
We thus turn to the remaining policies, Home’s three comprehensive general liability primary policies, each of which states that the policy does not apply
to bodily injury or property damage arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any water course or body of water; but this exclusion does not apply if such discharge, dispersal, release or escape is neither expected nor intended by the insured.[ ]
Plaintiff argues the trial court erred in its application of Woodhaven’s “initial discharge” rule. We agree.
A
In Woodhaven, a third party brought suit alleging injury as a result of exposure to pesticide the city regularly sprayed as part of its service to control insects and pests. 438 Mich 156. The city’s insurer brought an action for a declaratory judgment, asserting that its policy’s pollution exclusion clause applied and absolved it of any duty to indemnity or defend the city in the underlying action. The insurer’s policy contained a “sudden and accidental” exception to the pollution exclusion clause. The Court noted that the lower courts and both parties agreed that the release of the pesticide into the atmosphere was intentional, and not sudden and accidental. Id. at 163. The only argument made by the City of Woodhaven, and by the Court of Appeals in ruling in its favor in an unpublished opinion per curiam, was that coverage was possible because, arguably, the dispersal or escape of the pesticide to an area where it came in contact with the injured person’s skin was sudden and accidental, i.e., a sudden gust of wind may have blown the pesticide into the injured person’s window. Id. at 161. The Court concluded that the proper focus is on the initial discharge, dispersal, release, or escape into the atmosphere, and not the subsequent migration.
In announcing and applying the initial discharge rule in Woodhaven, id. at 162, the Court relied on three cases:
In Travelers Indemnity Co v Dingwell, 414 A2d 220, 225 (Me, 1980), the Supreme Court of Maine held that “[t]he behavior of the pollutants in the environment, after release, is irrelevant to [the application of the pollution exclusion].” (Emphasis in original.) Similarly, in Technicon Electronics Corp v American Home Assurance Co, 74 NY2d 66; 544 NYS2d 531; 542 NE2d 1048 (1989), the Court of Appeals of New York upheld the finding of the Supreme Court, Appellate Division, that “the logical and proper application of the pollution exclusion depends solely upon the method by which the pollutants entered the environment . . . .” Technicon Electronics Corp v American Home Assurance Co, 141 AD2d 124, 144; 533 NYS2d 91 (1988). See also Fireman’s Fund Ins Cos v Ex-Cell-O Corp, 662 F Supp 71, 75 (ED Mich, 1987) (“[application of the pollution exclusion depends exclusively upon the process by which pollutants entered the environment”). We agree.
The Court concluded at 162-163:
Applying this logic to the facts of this case, we conclude that the application of the pollution exclusion depends exclusively on the discharge, dispersal, release, or escape of the pesticide into the atmosphere. The behavior of the pesticide in the environment, after this initial release, is irrelevant. Furthermore, since the release of the pesticide by Woodhaven into the atmosphere was intentional, it cannot, as a matter of law, be accidental.
After Woodhaven, in Clare, supra, the Supreme Court declined to address the question of the applicability of the initial discharge rule in a case involving the escape of contaminants from a landfill and a pollution exclusion clause with “sudden and accidental” language. Clare, 446 Mich 11-12, n 10, 15, n 12. Clare involved contamination from a landfill, whose license had not been renewed. The dnr had for years told the city that its landfill did not meet legal requirements and the better course would be to close and seal it. The Court concluded that the city must have expected the release of pollutants and, therefore, the sudden and accidental exception did not apply. Id. at 14.
The circuit court in Clare had noted that that case arose from the release of contaminants from the landfill, not the placement of material into the landfill, id. at 11. The Supreme Court observed, id. at 15, n 12:
The plaintiffs argue that there is an “initial discharge rule,” Woodhaven at 160-163, and that the lower courts erred by failing to apply it in this case. That is, the plaintiffs want the analysis to focus on the city’s placement of pollutants into an unlicensed landfill, rather than on the subsequent release of contaminants from the landfill. Since intentional disposal of material for years would certainly not be “sudden and accidental,” the result in this case would be the same under either analysis. Thus, we do not reach the question.
Following Clare, this Court applied the “initial discharge” rule in Traverse City Light & Power Bd v Home Ins Co, 209 Mich App 112; 530 NW2d 150 (1995). One of the pollution exclusion clauses at issue in Traverse City contained the “neither expected nor intended” language, as do the Home policies we address, the other contained “sudden and accidental” language. Id. at 114-115. The plaintiff had disposed of fly ash, a waste material produced by its electrical generation plant, at an abandoned gravel pit from 1975 to 1987. The plaintiff started taking steps to license the facility in the early 1980s and the dnr, after tests were conducted, denied licensing in 1987. The dnr advised the plaintiff that continued use of the site for fly ash disposal would violate the Solid Waste Management Act, MCL 299.401 et seq.) MSA 13.29(1) et seq. The dnr issued a cease and desist order in 1988, which required the plaintiff to remediate the groundwater contamination. The plaintiff challenged the order and, after the defendant insurer denied coverage with respect to the order, filed a declaratory judgment action alleging the defendant owed it a duty to defend against the dnr’s order. Id. at 114. This Court concluded:
We hold that the initial discharge rule articulated in Woodhaven is applicable to the instant case. Accordingly, our analysis focuses on the initial discharge or placement of the materials into the gravel pit, not on their alleged subsequent migration into the soil. If the insured expected or intended the initial discharge (1975-81 policies) or if the initial discharge was not sudden and accidental (1981-84 policy), then there is no coverage. . . .
For twelve years, plaintiff arranged to discharge fly ash at the gravel pit at least two times a day. To now claim that plaintiff did not expect or intend this discharge “flies in the face of all reason, common sense and experience.” There being no factual dispute that plaintiff expected and intended the initial discharge of the fly ash, as a matter of law, the policies effective from 1975 to 1981 preclude coverage. [Id. at 117-119 (citation omitted).]
B
The question is whether the initial discharge rule, applied by the Supreme Court in Woodhaven, and by this Court in Traverse City, precludes application of the “neither expected nor intended” exception to the pollution exclusion under the facts of the instant case. Woodhaven holds that the focus is on the initial discharge into the atmosphere, and not the subsequent migration. Thus, when the offending material is sprayed into the atmosphere (Woodhaven) or placed in a quarry (Traverse City), the discharge has occurred, and the expected course of the migration is irrelevant. Conversely, where the contaminants are placed in a container, the focus is on the release of the contaminants into the environment from the container. Here, the initial placement of the contaminants was into an engineered landfill that was thought to be the equivalent of a container, but which had no artificial barrier. We conclude that Woodhaven and Traverse City are distinguishable, as is Clare, and that the initial discharge in the instant case is the discharge from the engineered landfill into the environment.
In the instant case, in contrast to Clare and Traverse City, plaintiff acted within the bounds of the law, placing the contaminants in a licensed landfill, believed to be adequate to contain the materials. As the trial court’s opinion notes:
There is no dispute that the County personnel felt that the landfill was, for its time, “state of the art.” The refuse, which was mostly home waste with some industrial sludge, was laid directly on the ground. There was no clay liner or artificial liner of any kind utilized. The evidence indicates that the designer of the Sparta Landfill believed that a 7- foot soil barrier between the bottom of the landfill’s cell and the ground water was sufficient to contain the waste and any contaminates [sic]. For the purposes of this motion, it is conceded that the County acted in utmost good faith and that the engineering study conducted by it concluded that the site took into consideration the requirements of Act 87 the Public Acts of 199_ [sic].
While the City of Woodhaven intentionally released the contaminants into the environment, although arguably not intending the extent of the dispersal, plaintiff here intended to contain the municipal waste in the Sparta landfill. The contaminants here were not intentionally placed in the environment or atmosphere, but were placed in what was believed to be a properly secured area. In Woodhaven, the argument that coverage might apply because the material that was intentionally released into the atmosphere might have been blown suddenly into a house strains the unambiguous words of the policy. In Woodhaven, there was no question that the discharge into the environment was intentional, though the damage was unexpected. Here, there is substantial evidence that the discharge into the environment was not expected or intended.
The instant case is also distinguishable from Traverse City in that plaintiffs landfill was state of the art for its time, was licensed, and was believed to be capable of containing the waste placed therein. In contrast, the plaintiff in Traverse City disposed of its material in an abandoned gravel pit, apparently without regulatory approval. In Traverse City, as in Wood-haven, although there may not have been an expectation that the contaminants would migrate to the extent they did, the initial discharge into the unli censed gravel pit was a discharge directly into the environment. There is no indication that the gravel pit in Traverse City was engineered to be, or believed to be, a contained area.
Similarly, in Clare, where the Court expressly declined to address the applicability or application of the initial discharge rule, concluding that under the facts of the case the distinction was without consequence, the landfill was unlicensed for a period of time, and the plaintiff was on notice that it was contaminating groundwater, but nevertheless continued with its disposal. 446 Mich 4-5.
c
None of the three cases relied on by the Court in Woodhaven in applying the initial discharge rule supports application of the rule to exclude coverage in the instant case.
A review of case law in other jurisdictions reveals a split of authority. In Patz v St Paul Fire & Marine Ins Co, 15 F3d 699, 704-705 (CA 7, 1994), the Seventh Circuit Court of Appeals, in an opinion by Chief Judge Posner, held that placement of contaminated water into evaporation pits lined by soil with no artificial barrier, where it was believed that the wastes were securely confined, was not a discharge of waste into the land; rather, the discharge of the wastes into the environment did not occur until the water leached through the bottom of the pit. The Patz family had a farm equipment manufacturing business on their property. When they decided to paint the farm equipment before selling it, they hired two consulting firms to advise how to dispose of the waste, which included water contaminated by phosphate. Following the consultants’ suggestion, the family dug an open pit for the water. The court noted: “The idea, well accepted in the waste-disposal community at the time, was that the water would evaporate, leaving a deposit of phosphate solids that would rest at the bottom of the pit and could be easily removed and used as fertilizer. Because the soil where the pit was to be dug was highly compacted clay soil, the water was expected to evaporate before it could permeate the soil, and so the soil beneath the pit would not be contaminated. ... All this was done as recommended by the consultants until 1980.” Id. at 701-702. Wisconsin’s dnr became involved, and in 1980 the family discontinued use of the pit. In 1986, the dnr discovered groundwater contamination from the pit. The Patzes paid $400,000 to clean up this site and another (both were on their property), and sought to recover that amount from St. Paul. St. Paul defended on various bases, including that the deposit of the phosphate-contaminated water in the evaporation pit constituted a discharge of waste materials into the land, and therefore coverage was precluded under the policy because there was a discharge into the land that was not “sudden and accidental.” Id. at 702.
The Pats court reviewed narrow interpretations of pollution exclusion clauses and then opted for what it called an “intermediate” interpretation, “in which the clause is read to distinguish between deliberately discharging waste materials into land, air, or water, whether or not ‘harm’ is intended [Woodhaven and Traverse City], and placing those materials in a container that is buried in land or water and subsequently leaks or breaks, discharging waste materials into the land or water surrounding the container.” Id. at 703. The court went on to find that the pit was “a containing structure.”
The floor of the pit was the soil, so when the phosphatic water was first poured into the pit it was introduced directly into the land with no barrier .... But soil is of coruse a building material. . . . The Patzes’ evaporation pit was a containing structure, despite its lack of artificial materials. The Patzes believed (a belief induced by their consultants) that they were taking advantage of the clay composition of the soil to avoid the expense of an artificial bottom for the pit. The clay would stop the water and when the water evaporated, the phosphatic solids would form a crust at the bottom of the pit that would be removed . . . before any harm was done to the soil beneath it. The introduction of the phosphatic water into such a structure is different from just dumping wastes onto land or into a body of water. The discharge of wastes into the environment did not occur until the water leached through the bottom of the pit; and the leaching was unintended and unexpected. [Id. at 704.]
The Patz court affirmed the district court’s decision in the insured’s favor. We recognize that, unlike Michigan, Wisconsin case law holds that the meaning of “sudden and accidental” is unintended and unexpected. Id. at 703. However, because the Home policy contains the “neither expected nor intended” language, this difference is not significant.
Sylvester Bros Development Co v Great Central Ins Co, 480 NW2d 368 (Minn App, 1992), after remand 503 NW2d 793 (Minn App, 1993), involved groundwater contamination from a landfill established in 1969. In reversing and remanding to the trial court for a determination whether the escape of pollutants from the landfill into the surrounding groundwater was sudden and accidental, the court noted:
When landfills began to be licensed in the late 1960s and early 1970s, landfill operators and even many environmental officials expected the design of a landfill would function to contain pollutants. In particular, the soil beneath landfills was expected to act as a filter to prevent pollutants from migrating into the underlying and surrounding ground and surface waters. Since landfills were expected and intended to contain any wastes placed in them, pollutants deposited in a landfill could only cause property damage if there was a “discharge, dispersal, release or escape” of those pollutants from the landfill into the surrounding environment. Thus, the deposit of pollutants into a landfill cannot be the triggering event; rather, the “escape” is the critical inquiry for purposes of determining the applicability of the pollution exclusion. [480 NW2d 373-374.]
On appeal after remand, the court affirmed the grant of summary judgment for the insurer on the basis that seepage from the landfill over two decades was not sudden. 503 NW2d 797.
See also the following cases, cited in Sylvester, involving landfills wherein the courts focused on the character of the discharge from the landfill, not the placement of the material into the landfill: New Castle Co v Hartford Accident & Indemnity Co, 933 F2d 1162, 1199-1203 (CA 3, 1991), rev’d on other grounds 970 F2d 1267 (CA 3, 1992), the pollution exclusion clause was held to focus on whether the discharge of pollutants (not the resulting damage) was sudden (unexpected) and accidental, and the case was remanded to the district court for consideration whether the county expected the landfill to discharge leachate, Claussen v Aetna Casualty & Surety Co, 865 F2d 1217, 1220 (CA 11, 1989), certifying the question to the Georgia Supreme Court whether the sudden and accidental pollution exclusion clause as a matter of law precluded coverage for liability for the environmental contamination caused by the discharge of pollutants from the landfill over an extended period, United States Fidelity & Guaranty Co v Korman Corp, 693 F Supp 253, 259-260 (ED Pa, 1988), the pollution exclusion precluded coverage because the underlying complaint alleged that leach ing and discharge from the landfill was not sudden but, rather, occurred continually over a long time, and Lower Paxton Twp v United States Fidelity & Guaranty Co, 383 Pa Super 558, 578; 557 A2d 393 (1989), focusing on whether the emission of methane gas from a landfill, a by-product of the natural decomposition of organic material in the refuse buried at the landfill, was sudden and accidental.
Other cases supporting this view are FL Aerospace v Aetna Casualty & Surety Co, 897 F2d 214, 220 (CA 6, 1990), affirming judgment in the defendant insurer’s favor, on factual basis, but noting that sudden and accidental exception applies to discharge of pollutants into the environment, and that the pertinent discharge was not the storage of the waste at the industrial waste site, and Queen City Farms, Inc v Central Nat’l Ins Co, 64 Wash App 838, 884-887; 827 P2d 1024 (1992), aff’d in pertinent part and remanded in part 124 Wash 2d 536; 882 P2d 703 (1994), holding that the relevant polluting event is the discharge or escape into the environment and that where material was deposited in a place that it was believed would contain or filter the material, the polluting event is the escape from that place.
In FL Aerospace, the Sixth Circuit Court of Appeals stated:
We cannot agree with Aetna’s position that simply because Berlin & Farro transported some 500,000 gallons of Midland-Ross waste to the Berlin & Farro site over a period of years, any discharges cannot be considered sudden and accidental. The “sudden and accidental” exception applies to the discharge, release, dispersal or escape of pollutants into the environment. Mere delivery of waste for storage at a facility that is licensed to store waste is not a discharge of pollutants into the environment. [897 F2d 220.][ ]
In Queen City Farms, the plaintiff, qcf, had a waste disposal site on its property from which hazardous wastes leaked and contaminated the groundwater. Qcf brought a declaratory judgment action against its insurer seeking to recover costs of cleanup. Among other issues, the Washington Supreme Court addressed the pollution exclusion clause:
Qcf urges the court to focus on the leakage from the pits, and not the initial disposal into the pits. The insurers urge the court to focus on the initial disposal into the pits.
. . . One construction of the [discharge, dispersal, release or escape into or upon land] language is that it includes the dumping of the wastes “upon” the land ....
jHowever, the terms “discharge,” “dispersal,” “release,” and “escape,” have plain, ordinary, popular meanings which indicate that the initial disposal into the pits is not the relevant euewi.“Dis charge” has as one meaning “to give outlet to: pour forth,” and “a flowing or issuing out. . . .” [Webster’s Third New International Dictionary (1981)] at 644. This definition may apply to mean the release from the pits. “Dispersal” is “the act or result of dispersing.” Webster’s, at 653. “Disperse” includes the meaning “to spread or distribute from a fixed or constant source. ...” Webster’s, at 653. “Escape” is “the act of escaping or the fact of having escaped: as .. . leakage or outflow esp. of steam or a liquid. . . .” Webster’s, at 774. “Release” includes “to set free from restraint, confinement, or servitude...” and “discharge from restraint. . . .” Webster’s, at 1917.
These are not the only dictionary definitions, but they are popular meanings which have in common the notion of an escape or release from confinement, or the dispersal from a fixed place. They apply well to the migration of the wastes from the pits into the groundwater. They do not apply well to disposal into the pits. [124 Wash 2d 562-563 (emphasis added).][ ]
The contrary view, that only the initial discharge, i.e., the placement of matter into or upon the land, is relevant for purposes of interpreting pollution exclusion clauses, is expressed in Broderick Investment Co v Hartford Accident & Indemnity Co, 954 F2d 601, 607 (CA 10, 1992), holding that placement of waste materials into holding containment ponds was a discharge into or upon the land within the meaning of the pollution exclusion clause, even if damage to the groundwater was not an intended result. “[WJhether Bic intended the waste to seep into groundwater and cause damage after the initial discharges into the land is not relevant.” In Oklahoma Publishing Co v Kansas City Fire & Marine Ins, 805 F Supp 905, 910 (WD Okla, 1992), the court followed Broderick, supra, and focused on the discharge of waste at a waste disposal site in a suit against the generator of hazardous waste, which had the waste transported to a waste site and a landfill. A third case expressing this view, but distinguishing the facts from Patz, is St Paul Fire & Marine Ins v Warwick Dyeing Corp, 26 F3d 1195, 1203-1205 (CA 1, 1994), the relevant discharge is the disposal of hazardous wastes into the landfill, and the release of substances into the environment was not a separate event constituting an independent discharge. The First Circuit Court of Appeals in St Paul distinguished the facts presented there from the facts in Patz:
Nothing in the record supports this contention that the L & RR landfill was a containment vessel such that discharges into it would not constitute a discharge “into or upon land.” The epa did state that the landfill “releases” hazardous substances “to the environment,” but this simply describes the property damage resulting from the discharge of waste into the landfill. There is no indication the EPA considered the landfill to be a containment vessel from which hazardous substances escaped. To the contrary, the object of the EPA’s concern in its 87 page order is the fact that hazardous substances were placed in the L & RR landfill to begin with, not the failure of the landfill to contain wastes or the failure of some party to properly operate and maintain the landfill.
We are not presented with a situation like the one recently discussed by Judge Posner in Pats, where the insured intended its disposal pit to serve as a containment vessel due to its clay bottom. Pats, 15 F3d 703-05. In that case, Judge Posner found cause to believe there may have been a separate unexpected discharge of pollutants subsequent to the placement of waste into the pit. The waste in this case, however, was removed from its containers on Warwick’s premises and placed into the landfill-literally onto the land-where it later caused contamination. We presume all parties involved expected this to be an acceptable practice, but we see no evidence that the landfill was expected to act as a containment vessel. [See Broderick, 954 F2d 607, n 5.] We therefore reject Warwick’s contention that there exists some unexpected and unintended discharge of its wastes triggering the exception to the pollution exclusion. Instead, we agree with the district court to the extent it found the pollution exclusion applicable because Warwick’s discharge of waste was expected and intended and thus not “accidental.” [26 F3d 1205 (emphasis added).][ ]
Thus, courts have come to a variety of conclusions in cases presenting similar fact situations and issues. We conclude that Patz presents a fact situation most analogous to the instant case, and that its analysis is sound.
In summation, application of the pollution exclusion requires that the court focus on the initial discharge into the environment. If that discharge is intended, there is no coverage, notwithstanding that the damage may have been unintentional. If waste materials are placed in a contained area or structure and later escape into the environment, the latter discharge is the relevant discharge. In the instant case, the relevant discharge is the release of the pollutants from the landfill. We therefore remand for a determination whether plaintiff either expected or intended the discharge, dispersal, release, or escape of contaminants or pollutants into the environment from the Sparta landfill. Coverage cannot be excluded until this is determined. Home has a duty to defend until coverage under the policies is excluded. Polkow, supra.
v
Plaintiff next argues that Home’s primary comprehensive general liability policies’ personal injury endorsement affords it coverage without regard to the pollution exclusion. The pertinent provision states:
This Company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of injury (herein called “personal injury”) arising out of one or more of the following offenses:
Group C-wrongful entry or eviction, or other invasion of the right of private occupancy.
Plaintiff’s argument is that the claims of the State of Michigan, as embodied in the administrative action taken against Kent County by the DNR, arise out of Kent County’s alleged contamination of the state’s groundwater, and the alleged groundwater contamination constitutes a wrongful entry or trespass on the rights of the people of Michigan in the groundwaters of the state.
The trial court ruled that Home’s policies’ personal injury liability endorsement did not afford coverage:
First of all, whether or not in the right case the personal ipjury may or may not apply is not what you have in front of you. What you have here is basically-What we’ve got to keep in mind is the dnr says, “Maybe we’ve got to do something. Maybe sometime in the future-maybe clean up this mess down there.” I don’t see that as a personal endorsement.
If we have one of the home owners coming in here and saying, “You’ve got to clean up my yard, because I got muck in my yard” or something like that, then you have a better argument. But looking at it right here. I’m going to rule that there is no coverage under the personal injury endorsement.
We believe the trial court’s ruling was correct, because the case before us does not involve the infringement of a private right of occupancy, but, rather, involves a site-remediation request from a governmental regulatory agency.
The “Group C” offenses, by the explicit terms of the policies, must affect a right of private occupancy. The two torts enumerated, wrongful entry and eviction, involve disputes over possessory interests in real property. There is neither a private occupancy right nor a possessory interest dispute here. Assuming the people of Michigan own the groundwater, as plaintiff argues, a public right would be involved.
This reasoning is supported by the district court’s decision in Harrow Products, Inc v Liberty Mutual Ins Co, 833 F Supp 1239 (WD Mich, 1993), aff’d in part, rev’d in part, and remanded 64 F3d 1015 (CA 6, 1995). Harrow Products owned and operated a manufacturing plant that was identified as the cause of groundwater contamination. After the dnr notified Harrow that it was in violation of the Water Resources Commission act, MCL 323.1 et seq.; MSA 3.521 et seq., the village in which Harrow was located sought damages and recovery of response costs under the Comprehensive Environmental Response, Compensation, and Liability Act (cercla), 42 USC 9601, and the Michigan Environmental Protection Act, MCL 691.1201 et seq.; MSA 14.528(201) et seq. The federal district court found that the pollution exclusion clauses of the insurance contracts barred coverage because the contamination was not sudden and accidental. Harrow also raised the issue raised in this case regarding whether there was coverage under an identically worded personal injury endorsement for injury to the groundwater because the contamination was a wrongful entry or eviction, or other invasion of the right of private occupancy “enjoyed by the people of the Village of Saranac and of the State of Michigan.” 833 F Supp 1245. The district court found the endorsement inapplicable:
Here, there is no reasonable basis for concluding that the liability Harrow Products is or may be made to bear in the MDNR administrative proceedings or in the Village of Saranac action is the result of wrongful entry or eviction or other invasion of the right of private occupancy. That these terms are used to define “personal injury,” and are included among other torts or offenses to personal rights, such as false arrest, malicious prosecution, defamation and invasions of privacy, indicates that they pertain to a person’s right to actually possess, inhabit or occupy real property. Here, unlike the Titan [Holdings Syndicate, Inc v City of Keene, New Hampshire, 898 F2d 265 (CA 1, 1990)], Pipefitters [Welfare Educational Fund v Westchester Fire Ins Co, 976 F2d 1037 (CA 7, 1992)] and Hirschberg [v Lumberman’s Mutual Casualty, 798 F Supp 600 (ND Cal, 1992)] cases, no showing has been made that Harrow Products is threatened with liability for interfering with property owners’ or occupants’ rights of private occupancy. No private occupants of property have filed claims in either action. Nor has the mdnr or Village of Saranac asserted claims as subrogees of, or in some other representative capacity for, occupants of property. The mdnr and Village of Saranac actions, asserting claims under the Michigan Water Resources Commission Act, the Michigan Environmental Protection act, and cercla based on the “people’s” interest in uncontaminated groundwater, cannot reasonably be characterized as premised upon interference with rights of private occupancy. [833 F Supp 1246 (emphasis in original).]
The Sixth Circuit Court of Appeals affirmed on somewhat broader grounds, concluding that the Michigan Supreme Court would hold that the pollution exclusion clause bars coverage under the personal injury endorsement. 64 F3d 1021-1025.
Plaintiff relies on Scottish Guarantee Ins Co v Dwyer, 19 F3d 307 (CA 7, 1994), Pipefitters, supra, Titan, supra, and American States Ins Co v Canyon Creek, 786 F Supp 821 (ND Cal, 1991), in support of its position. However, each of these cases involves a private plaintiff seeking redress for interference with private property rights. Here, while there was a private action by adjoining landowners, Home defended and settled the action and the instant case involves only potential governmental site-remediation requirements. Nor do State of New York v Shore Realty Corp, 759 F2d 1032 (CA 2, 1985), and In re Acushnet River & New Bedford Harbor: Proceedings re Alleged PCB Pollution, 712 F Supp 994 (D Mass, 1989), establish coverage. That the cercla is based on common-law duties does not mean that a right of private occupancy is involved in the instant case.
Plaintiff also relies on City of Edgerton v General Casualty Co, 172 Wis App 2d 518; 493 NW2d 768 (1992). The Wisconsin Court of Appeals opinion in Edgerton does, indeed, support plaintiffs position that the personal injury endorsement provides coverage for governmental remediation requests because groundwater contamination invades a right of private occupancy. However, Edgerton was reversed in part by the Wisconsin Supreme Court, 184 Wis 2d 750; 517 NW2d 463 (1994). The Wisconsin Supreme Court, stating that the case involved, among other issues, the question whether “the personal injury provisions of an insurance policy provide coverage for environmental cleanup costs when then has been no allegation of wrongful entry, eviction, or other invasion of the right to private occupancy,” did not reach this issue, concluding that summary judgment should be entered in favor of the insurers on the ground that there was no duty to defend because no suit for damages was presented, and thus there was no need to “further analyze” the personal injury provisions. Id. at 757, 758. We do not find the Wisconsin Court of Appeals decision in Edgerton persuasive with regard to the private right issue.
We conclude the trial court correctly determined that the personal injury liability endorsement in Home’s primary policies did not afford coverage for the governmental requests that plaintiff remediate the site.
Affirmed with regard to Great American Insurance Company and the Home Insurance Company excess liability policies. Reversed and remanded with regard to the Home Insurance Company primary policies.
L.F. Simmons, Jr., J., concurred.
Holbrook, Jr., P.J. I concur in the result only.
The remaining defendants are not part of this appeal.
The March 8, 1983, letter from the dnr stated that it had completed the hydrogeological study at the Sparta landfill and that
this study and data obtained from the Kent County Health Department show conclusively that the landfill is the source of the organic chemicals and other contaminants which have been detected in samples from monitoring wells, and which have rendered water in the private wells at four nearby residences unfit for consumption.
Plaintiff’s third amended complaint, filed subsequently, named Great American.
Plaintiff’s appellate brief refers to deposition excerpts that are not attached and that we have not found in the record. Plaintiff states in footnote three of its appellate brief that all the depositions referred to therein were provided to the trial court in support of or in opposition to motions in the trial court. Defendant Home’s trial court brief also makes reference to deposition transcripts apparently provided to the trial court. There are no entire deposition transcripts before us. The record before us contains multiple summary disposition motions and briefs in opposition of a number of defendants, including those dismissed, with numerous exhibits, and only select pages of various depositions.
Plaintiff’s answers to interrogatories indicate it was first advised around June 1, 1979, that the DNR was investigating the possibility that the contaminants found in the neighboring private wells might have come from the Sparta landfill.
Home’s motion was brought under MCR 2.116(C)(10). Although Great American’s motion was brought under MCR 2.116(C)(8) and (C)(10), it is clear the trial court considered documentary evidence beyond the pleadings in ruling on both motions.
Plaintiff relatedly argues that remand is necessary because the trial court improperly made a specific finding regarding the credibility of testimony, pointing to the trial court’s statement in its opinion and order that
[d]espite the years the parties have had to do discovery and despite some “suggestions” by the County to this Court, there is no credible evidence which would indicate that anything other than the Sparta Landfill is the source of contamination in the ground water.
We conclude that although the trial court used the word credible, it did not err in concluding that no facts were presented to create a genuine issue of material fact.
The pollution exclusion clauses at issue in Upjohn and Woodhaven are virtually identical to the Great American clause and the Home excess policies clauses, quoted earlier. Upjohn, 438 Mich 206; Woodhaven, 438 Mich 160.
In light of our disposition, we need not reach plaintiff’s argument that the trial court erred in ruling that coverage under Great American’s policy was barred because the contamination did not manifest itself until after the policy expired on July 24, 1975.
Plaintiff’s appellate brief correctly notes that this exclusion clause differs from those at issue in the Upjohn trilogy.
See Polkow v Citizens Ins Co, 438 Mich 174, 179; 476 NW2d 382 (1991), and the dissenting opinion by Riley, J., at 192-194; Upjohn, supra.
The Woodhaven Court cited Travelers Indemnity Co v Dingwell, 414 A2d 220, 225 (Me, 1980), for the proposition that the behavior of the pollutants in the environment, after release, is irrelevant to the application of the pollution exclusion. 438 Mich 162.
The underlying suit in Travelers was a class action seeking damages for contamination of the nearby residents’ well water resulting from Dingwell’s operation of an industrial waste facility. The facts are sketchy, but the class action complaint alleged in pertinent part:
That among the products processed by the Defendants or utilized in the business of the Defendant are products containing or producing the chemicals trichloroethane, trichloroethylene and dimethylsulfide. . . .
That as a result of negligence on the part of the Defendant . . . products containing the aforesaid chemicals permeated the ground to the ground water table to the properties of the Plaintiffs resulting in the contamination of water in the Plaintiffs’ wells. [414 A2d 224.]
In the declaratory judgment action regarding insurance coverage, the Maine Superior Court granted summary judgment on the pleadings to the three insurers on the basis of pollution exclusion clauses. Id. at 222. Two of the insurers, American Policyholders’ Insurance Company (ah) and Chicago Insurance Company (Chicago), had “sudden and accidental” clauses in their pollution exclusions, while the third insurer, Travelers Indemnity Company (Travelers), had the following pollution exclusion:
It is agreed that this policy does not apply
(a) to bodily injury or property damage arising out of any emission, discharge, seepage, release or escape of any liquid, solid gaseous or thermal waste or pollutant
(1) if such emission, discharge, seepage, release or escape is either expected or intended from the standpoint of any insured or any person or organization for whose acts or omissions any insured is liable. [Id. at 223.]
The Maine Supreme Court reversed and remanded for entry of judgment declaring that the insurers had a duty to defend, but did not reach the question of the duty to indemnify. Id. at 229. The court held that the Superior Court erred in holding that the Travelers pollution exclusion had the same meaning as the “sudden and accidental” exclusions, noting that “[a] release may be unexpected and unintended, without being sudden and accidental.” Id. at 223. The court held that the complaint generated a duty to defend because it disclosed a potential for liability within the coverage and contained no allegations of fact that would necessarily exclude coverage. Id. at 227. Turning to analysis of the underlying class action complaint, the Maine Supreme Court found that the Superior Court erred in finding that the allegations described “an ongoing, deliberate process”:
[T]he Superior Court failed to distinguish between the gradual permeation of the ground, by which the water table was ultimately polluted, and the initial release of the pollutants from Dingwell’s facility. The class action plaintiffs, at this point, have no way of knowing how the toxic wastes entered the ground. There may have been either intentional dumping or burial or unintentional spills, leaks, or other accidents. The [negligence] allegations . . . encompass unintentional release into the ground, and do not necessarily describe a “deliberate process.” [Id. at 224-225.]
The proposition relied on by the Michigan Supreme Court in Woodhaven, is in the Maine Supreme Court’s discussion regarding the policies’ language:
Both pollution exclusions focus on the release of pollutants. The Chicago and API clause reads:
“This policy does not apply ... to personal injury or damage . . . arising out of . . . discharge, dispersal, release or escape . . . unless sudden and accidental.”
The Travelers clause reads
“ . . . if . . . emission, discharge, seepage, release escape ... is either expected or intended.”
The behavior of the pollutants in the environment, after release, is irrelevant to these provisions. The Superior Court erred in finding that the allegation of .permeation of the ground necessarily took Count I out of Chicago and API’s exception for “sudden and accidental” releases. It is possible that the releases could have been unexpected and unintended, and thus outside of Travelers’ exclusion. [Travelers, supra at 225.]
While this case indeed focuses on the initial discharge of the pollutants into the environment, it does not discuss how one determines what is the initial discharge in a case involving an engineered landfill.
Technicon Electronics Corp v American Home Assurance Co, 141 AD2d 124, 144; 533 NYS2d 91 (1988), aff’d 74 NY2d 66; 544 NYS2d 531; 542 NE2d 1048 (1989), involved “sudden and accidental” pollution exclusion clauses and intentional, long-term discharge of toxic waste chemicals from Technicon’s manufacturing plant into a creek.
A residential community adjacent to the plant sued Technicon for personal injuries allegedly suffered from exposure to toxic chemicals intentionally discharged into the nearby waterway. 74 NY2d 72. The federal Environmental Protection Agency later notified Technicon by letter that it might be potentially responsible for the cleanup of the creek. Technicon notified its insurers, who claimed the pollution exclusion clauses (sudden and accidental) precluded coverage. The lower court granted the insurers’ summary judgment motion, holding they had no duty to defend or indemnify Technicon, either against the suit by nearby residents or in connection with any related matter pending before the epa. 141 AD2d 146. The lower court found that “an intentional discharge will trigger the pollution exclusion regardless of whether the ultimate damages were unintended.” Id. at 140.
The citation of this case in Woodhaven is to the lower court’s statement, after an extended discussion on the meaning of “sudden” and “accidental,” that
the logical and proper application of the pollution exclusion depends solely upon the method by which the pohutants entered the environment.... The relevant factor is not whether the poEcyholders anticipated or intended the resultant injury or damage, but whether the toxic material was discharged into the environment unexpectedly and unintentionaEy or knowingly and intentionaEy. [141 AD2d 144],
Again, while the New York courts focused on the initial discharge into the environment, which was admittedly intentional in Technicon, as in Woodhaven, the discussion does not assist in determining the proper application of the rule where the pollutants are placed in a landfill believed to be separated from the environment.
The third case cited by the Woodhaven Court is Fireman’s Fund Ins Cos v Ex-Cell-O Corp, 662 F Supp 71 (ED Mich, 1987). This case involved Ex-Cell-0 and its subsidiaries’ motion for partial summary disposition seeking a declaration that the insurance companies were obligated to defend them against potential liability for allegedly contributing to environmental contamination at a number of locations. The policyholders had received written notice that governmental agencies considered them potentially responsible for the contamination at various sites. The insurers denied coverage.
With regard to the issue of the insurers’ denial of coverage under “sudden and accidental” exclusions, the court stated:
Application of the pollution exclusion depends exclusively upon the process by which pollutants entered the environment. See Jonesville Products, Inc v Transamerica Insurance Group, 156 Mich App 508, 512, 402 NW2d 46 (1986) (“The pollution exclusion focuses on the release of pollutants . . . .”) (emphasis original). The decisive inquiry is not whether the policyholders anticipated property damage, or whether they regularly disposed of hazardous waste, but whether the pollutants entered the environment unexpectedly and unintentionally. [662 F Supp 75-76.]
The court determined the insurers could not rely on the pollution exclusion to deny a defense until they established that the release of pollutants was expected or intended, citing Jonesville.
Jonesville, which preceded the Woodhaven trilogy by five years, involved interpretation of “sudden and accidental” language in a pollution exclusion clause, and was also decided on the pleadings alone. In Jones-ville, a declaratory judgment action, the underlying complaint alleged that Jonesville had negligently discharged triehlorethylene and other highly toxic chemicals onto its property and that the triehlorethylene subsequently encroached upon the plaintiffs’ property. The complaint alleged the pollution and contamination of the plaintiffs’ water had been “continuous.” The trial court construed the plaintiffs’ complaint as alleging “general dumping,” which was not sudden and accidental, and concluded that the pollution exclusion applied. This Court reversed the circuit court’s determination that the insurer had no duty to defend:
We find that the circuit court failed to distinguish between the frequency of acts which resulted in the release of contaminants and plaintiff’s knowledge or notice of the release of pollutants as a result of those acts. The [underlying complainants] did not specify in their complaint how the toxic wastes entered the ground. There may have been either intentional dumping or burial, unintentional spills or leaks from inadequate containers, or other accidents. . . .
The pollution exclusion focuses on the release of pollutants:
The circuit court erred in finding that the allegation of “continuous” negligent discharge of waste . . . took Count I . . . out of defendant’s exception for “sudden and accidental” release. It is possible that the releases could have been sudden, i.e., unexpected, and accidental, i.e., unintended, and thus outside the exclusion. [156 Mich App 512.]
Neither Ex-CeU-0 nor Jonesville supports the conclusion that the pollution exclusion clause applies in the instant case without regard to the question whether it was expected or intended that pollutants escape from the engineered landfill into the environment.
The cases discussed in this section present a variety of issues arising under various insurance policies. In addition to addressing issues pertinent to this discussion, several address the proper interpretation of the “sudden and accidental” exception to the pollution exclusion, some concluding that the clause contains a temporal element and some concluding that the clause means unexpected and unintended. This dispute has, of course, been resolved in Michigan by Upjohn. Other cases address the question whether the pollution exclusion and exception apply to the discharge or the damage, where the insured argues that the focus should be whether the pollution damage was sudden and accidental, or unexpected and unintended, not the discharge itself. In this regard, we think it clear that the focus must be on the discharge, not the damage, in accordance with the clear language of the policy. A related question is whether the unexpected and unintended exception to the exclusion has any meaning in occurrence policies where an occurrence is defined as an exposure or event resulting in unexpected and unintended damage. We think it does. With regard to the discharge/damage distinction and the effect of the “neither expected nor intended” exception to the pollution exclusion, reference to Woodhaven is instructive. There, the damage was unexpected and unintended, yet the discharge was intentional. Thus, all provisions of the policy are given effect when construed as follows. There was an occurrence triggering coverage (exposure, and unexpected and unintended damage), a discharge triggering the pollution exclusion (personal injury arising out of the discharge of chemicals into the atmosphere), and an intentional discharge directly into the environment that cannot be regarded as either sudden and accidental, or unexpected and unintended. Thus, while the various cases present differing fact situations and issues, in evaluating their applicability to the instant case, it must be remembered that (1) in Michigan, sudden and accidental has a temporal element; (2) the instant policies are not sudden and accidental policies but unexpected and unintended policies, so that coverage is restored if the discharge is unexpected or unintended; and (3) in applying the exception to the pollution exclusion, rather than the occurrence language, the discharge into the environment must be unexpected and unintended, rather than the damage.
The certified question was answered in 259 Ga 333; 380 SE2d 686 (1989). The court interpreted “sudden and accidental” to mean “unexpected and unintended” and held that coverage was not precluded. Again, any distinction based on the fact that the Michigan courts do not construe sudden and accidental this way is irrelevant because the Home policy used the unexpected and unintended language. Additionally, regardless of the words used, the courts focused on the discharge from the landfill, not the placement of the material in the landfill.
We note that FL Aerospace was decided after the Court of Appeals decided Woodhaven and before the Supreme Court’s initial denial of leave, and later grant and reversal, in Woodhaven. Nevertheless, the court focused on the discharge into the environment.
The Queen City Farms court further observed, after discussing Sylvester, 480 NW2d 373-374, that
[t]he technology and understanding of the safety and containment characteristics of waste disposal sites then and now are far different. It seems to us that an average purchaser of insurance in earlier years would have been justified in thinking that there was coverage for the placement of wastes into a waste pit, or a landfill, which was expected to contain the wastes and from which it was not expected that they would discharge, disperse, release, or escape into the groundwater, or from which it was believed that the waste materials would be safely filtered. That is, the average purchaser of insurance would have understood that mere placement of wastes into a place which was thought would contain or filter the wastes would have not been an event which would fall within the exclusion. We therefore hold that the relevant polluting event is the discharge, dispersal, release, or escape of toxic material into the environment, and where material has been deposited in a place which was believed would contain or safely filter the material, such as a waste disposal pit or sanitary landfill, the polluting event is the discharge, dispersal, release, or escape from that place of containment into or upon the land, the air or water, including groundwater. [124 Wash 2d 564-565.]
The following cases cited in St Paul are also distinguishable:
Mays v Transamerica Ins Co, 103 Or App 578; 799 P2d 653 (1990), affirming summary judgment for the insurers on the insured’s breach of contract claim seeking indemnification under general liability policies for costs of environmental cleanup. The insured formerly owned property on which she operated a paint manufacturing business that generated waste consisting of used solvent, water, and paint sludge, which was deposited in an unlined pit dug for the purpose of holding the waste. Although it appears that the insured did not intend the waste to move into the groundwater, there is no indication that the unlined pit was expected to act as a containment vessel.
A Johnson & Co, Inc v Aetna Casualty & Surety Co, 933 F2d 66 (CA 1, 1991), affirming the grant of summary judgment to the insurers regarding the duty to defend and indemnify the insured applying sudden and accidental pollution exclusion clause. The facts were clear that the contamination of the site arose because of continuing disposal practices, including direct discharge to the ground and leakage from multiple tanks in poor condition.
Hartford Accident & Indemnity Co v U S Fidelity & Guaranty Co, 962 F2d 1484 (CA 10, 1992), affirming the district court’s grant of the insurer’s summary judgment motion and its finding that continuous or routine discharges are not covered, construing “sudden and accidental” under Utah law to mean temporarily abrupt and unexpected and unintended.
The parties agreed the insured was unaware its oil contained pcbs, that it intentionally discharged liquid wastes containing pcbs directly onto the ground and into unlined earthen pits, some of which had overflow pipes that carried the wastes into the surrounding environment, and that it did not expect or intend that water in or leaving the pits would contain pcbs. Id. at 1486, 1487. Thus, while the damage may have been unintended, the discharge into the environment was not. The intentional disposal of liquid wastes onto the ground and into the unlined pits with overflow pipes was the discharge into the environment. Also see Pepper’s Steel & Alloys, Inc v United States Fidelity & Guaranty Co, 668 F Supp 1541, 1549 (SD Fla, 1987), a similar case in which the court reached a contrary result, holding that there was coverage notwithstanding the pollution exclusion.
Northern Ins Co of New York v Aardvark Associates, Inc, 942 F2d 189 (CA 3, 1991), affirming the district court’s grant of summary judgment to the insurers on the ground the insured failed to make showing that discharges were sudden and accidental. Underlying epa complaint and related administrative allegations portrayed a process of pollution occurring over many years: “many different . . . environmental violations had occurred . . . and had ‘continued throughout the operation of the landfill.’ ” Id. at 196. (Citation omitted.)
Hybud Equipment Corp v Sphere Drake Ins Co, 64 Ohio St 3d 657; 597 NE2d 1096 (1992), reversing a determination that the insurer was obligated to defend the three insureds, on basis that coverage was precluded by sudden and accidental clause, and declining to find the term sudden and accidental ambiguous.
Former owner of a licensed landfill and a transporter of waste material torn commercial and industrial entities to the landfill were sued by a neighboring property owner, the epa and the State of Ohio because of leakage of pollutants from the landfill into soil, groundwater, air, and nearby residential wells. The insurers defended on the basis of pollution exclusion. Id. at 1098. The court noted that the complaints alleged disposal or acceptance of wastes in the landfill over an extended period, and held that the sudden and accidental exception was never invoked because none of the three underlying complaints alleged that the release or discharge of the waste happened abruptly or instantaneously. Id. at 1103.
The first underlying complaint alleged that as a result of damage to storage containers, various chemicals had escaped into the air, soil, and groundwater over a fourteen-year period. The second alleged that the landfill had accepted various waste materials over a twelve-year period, even though it had failed to install an impenetrable liner to halt any leakage of waste. The third action alleged that, as a result of the manner in which waste had been handled, a leachate had been generated and was seeping into the ground and surface waters along with other hazardous waste, and that this had been going on for over a decade. Id. at 1097. Thus, under no construction of the facts could the discharge be regarded as sudden and accidental. The case does not directly address the issue of the relevant discharge.
Liberty Mutual Ins Co v Triangle Industries, Inc, 957 F2d 1153 (CA 4, 1992), affirming the district court’s grant of the insurers’ summary judgment motions on the ground that Triangle Industries intended the discharge of its toxic sludge upon the ground of a landfill and therefore discharge was not accidental, although damage may have been unintended.
The court noted “for purposes of this appeal there is no dispute that the environmental damage in this case arose from the discharge of pollutants upon the land.” Id. at 1157. The court rejected Triangle’s argument that “sudden and accidental” applied to the pollution damage, rather than to the discharge. The court noted that no evidence was presented that Triangle did not expect and intend its sludge to be dumped upon the ground at the landfill, that the sludge was a normal by-product of Triangle’s manufacturing operation, and that it hired trucks to haul the waste. “Given this, we agree with the district court that the open dumping of a sludge onto the ground, particularly when performed as part of a regular business activity, cannot be considered an accidental discharge of the contaminant.” Id. at 1158. The court’s analysis focused on the discharge/damage distinction, concluding that the sudden and accidental character of the discharge, rather than the damage, is relevant, a conclusion with which we are in complete accord. It was never argued that the landfill was expected to contain the sludge, and that there was a later sudden and accidental (or unexpected and unintended) discharge into the environment.
Liberty Mutual Ins Co v SCA Services, Inc, 412 Mass 330; 588 NE2d 1346 (1992), reversing orders granting sca’s motion for summary judgment and ordering that summary judgment be entered for the insurers, finding the sudden and accidental pollution exclusion clause precluded coverage. The underlying complaint alleged sca arranged to dispose of several thousand barrels of industrial and chemical wastes, many containing “hazardous substances,” and that sca knew or should have known these wastes were noxious, dangerous, hazardous substances and that the wastes were deposited directly into the ground at the site in trenches dug for that purpose. Id. at 333. The court concluded the pollution alleged was not sudden, noting that the complaint “details routine business activity lasting over several months in which the toxic contents of the barrels brought by sca to the landfill were either emptied into open trenches or dumped into trenches and flattened with a bulldozer.” Id. at 336. Rejecting sca’s argument that the discharges were sudden because, as the barrels were crushed or emptied, the commencement of the release from each barrel was abrupt, the court noted that a discharge that continues for an extended period would likely cease to be accidental or sudden. Again, the facts demonstrate that the discharge of the toxic waste into the trenches was the discharge into the environment. There was no allegation that the trenches were designed to contain toxic wastes.
Borg-Warner Corp v Ins Co of North America, 174 AD2d 24; 577 NYS2d 953 (1992). The plaintiff sought defense and indemnification for claims arising out of its disposal of hazardous industrial waste at nineteen sights off its property, over periods ranging from two years to four decades. In addition, the plaintiff was sued for groundwater contamination from its manufacturing facility.
The court held that the liability arising out of the long-term, intentional disposal of the plaintiff’s industrial waste was not covered under the sud den and accidental exception, because the discharges were over a number of years and thus not sudden. Further, the court rejected as irrelevant the plaintiff’s argument that the discharges were accidental because the plaintiff did not expect the pollution, noting that the pollution exclusion clause “ ‘excludes from coverage liability based on all intentional discharges of waste whether consequential damages were intended or unintended.’ ” Id. at 32, quoting Technicon Electronics Corp v American Home Assurance Co, 74 NY2d 66, 75; 544 NYS2d 531; 542 NE2d 1048 (1989). In discussing the pollution exclusion, the court did not address whether the various landfill sites were engineered to contain the hazardous industrial waste. Rather, the focus was on the intentional discharge/unintended damage distinction. It was assumed that the intentional discharge of waste into the landfill was the discharge into the environment.
G Heileman Brewing Co v Royal Group, Inc, 779 F Supp 736 (SD NY, 1991), aff’d without opinion 969 F2d 1042 (CA 2, 1992), after discussing the Upjohn trilogy, the court granted summary judgment for the insurers, applying Woodhaven’s initial discharge rule to the dumping of waste directly into unlined pits at a waste site.
The plaintiff sought indemnification for costs of cleanup of the Otisville, Michigan state-approved toxic waste dump. The plaintiff’s predecessor, a beer brewer and distributor, had employed a waster hauler to transport used bottle wash to the site in the 1970s. In 1985 and 1986, the epa notified companies that had used the dump that they were potentially responsible parties.
One of the plaintiff’s arguments was that to determine coverage the focus should not be “on the release of waste into containment, but on how the waste was released into the environment.” Id. at 740. The court concluded that the Upjohn trilogy required that summary judgment be entered in the insurers’ favor:
The parties do not dispute . . . that a waste hauler employed by plaintiff deposited waste into unlined earthen lagoons at the site. The record also indicates that the waste was not artificially contained, as in Upjohn, but that it was dumped into earthen pits at the site. While plaintiff has recently attempted to make an issue out of whether it has conceded that the pits were lined or unlined, plaintiff failed to put any evidence into the record to prove that the lagoons were lined, and never disputed indications in the record that the pits were unlined.
* * *
In sum Woodhaven teaches that the Court is to focus on the initial discharge of waste into the environment; here, that discharge was the dumping of waste directly into pits in the earth at the Otisville dump. The record indicates that the discharge was not sudden, as that word was defined in Upjohn, because waste was deposited repeatedly over an extended period of time. The record also indicates that the discharge was not accidental because the waste was deliberately dumped into the earth. Accordingly, the pollution exclusion precludes coverage in this case. [Id. at 740.]
In Heüeman, while the landfill was licensed, there was apparently no contention that it was designed to be a containment facility. The court clearly concluded that the discharge into the earthen pits was the discharge into the environment. Such a conclusion is not compelled in the instant case.
With regard to Heileman and Borg Warner, see, on a related point, Nestle Foods Corp v Aetna Casualty & Surety Co, 842 F Supp 125, 131-132 (D NJ, 1993), where the court held the pollution exclusion did not apply because there was no discharge by the insured.
The facts recited earlier in this opinion are as viewed most favorably to plaintiff. Home presents additional facts and draws inferences less favorable to plaintiff. Thus, there are factual issues to be resolved on remand.
With regard to eviction, see 15 Callaghan’s Michigan Civil Jurisprudence, Landlord and Tenant, § 28, p 347, and 52 CJS, Landlord and Tenant, § 445 et seq., and with regard to wrongful entry, see 52A CJS, Landlord and Tenant, § 727.
We need not reach the broader question whether any pollution-related claims are covered under the personal injury endorsement, which unlike the bodily injury and property damage coverage section does not contain a pollution exclusion provision, because we conclude the governmental claims at issue here are not covered.
Similarly, Northrop Corp v American Motorists Ins Co, unpublished opinion of the Superior Court of the State of California for the County of Los Angeles, filed April 8, 1992 (Docket No. C 710571), relied on by plaintiff, also involves a private plaintiff. | [
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Neff, P.J.
Defendants appeal from an order of the circuit court vacating an arbitrator’s original award in this labor dispute. The dispute in this case is whether two governmental units from different branches of government can be joint employers. We find that they cannot be joint employers and we affirm the circuit court’s order.
i
The Berrien County Probate Court operated a juvenile detention home in a building owned by Berrien County. The two maintenance workers for the building were employed by the probate court and were represented by defendants. When it was decided that the probate court should no longer be responsible for maintenance of the building, the chief judge was concerned about the continued employment of the two maintenance workers. He contacted the county in order to determine if the two employees could keep their jobs, albeit as employees of the county. To that end, the county engaged in negotiations with its union, the Teamsters, and obtained certain concessions that allowed the two maintenance employees to enter county employment as members of the Teamsters union. The employees were then laid off by the probate court and rehired by the county to provide maintenance work at the same building.
Defendants claimed that this process breached their collective bargaining agreement with the probate court. Defendants considered the transaction a sham, claiming that it was simply a ruse to switch the two workers to a different union in violation of the collective bargaining agreement between the court and defendants. Accordingly, defendants initiated a grievance procedure to protest the process.
Defendants’ grievance ultimately went to arbitration. The arbitrator determined that the transaction involving the employees did constitute a breach of defendants’ collective bargaining agreement. Neither party appeals this determination.
The arbitrator then determined that the probate court and the county were joint employers of the two maintenance workers. The arbitrator based his decision on a number of factors relating to the arrangement agreed to by the county and the court: (1) probate court employees are subject to policies and procedures formulated by the county, (2) the county provides personnel, payroll, and labor-related services to the probate court, and (3) the ultimate decision regarding the employees in this case was reached jointly by the county and the probate judges. The arbitrator then ordered the employees in question to be restored as members of defendants, pursuant to the agreement between defendants and the probate court, which agreement, according to the arbitrator, included the county.
The probate judges then appealed this ruling to the circuit court, arguing, among other things, that the arbitrator exceeded his authority in finding the county and the probate court to be joint employers because that finding violates the separation of powers doctrine. The circuit court agreed, and remanded the matter to the arbitrator to fashion a remedy that did not include the county.
On remand, the arbitrator ordered the probate judges to pay back union dues owed to defendants on behalf of the two maintenance workers.
n
A
This Court’s review of an arbitrator’s award is very limited. We may not pass on the findings of fact or conclusions of the arbitrator reached on the merits of the case. Port Huron Area School Dist v Port Huron Ed Ass’n, 426 Mich 143, 150; 393 NW2d 811 (1986). We determine whether the arbitrator exceeded his contractual authority, or whether he made an error of law on a controlling issue that is apparent on the face of the award. DAIIE v Gavin, 416 Mich 407; 331 NW2d 418 (1982). For an error of law to warrant reversal of an arbitrator’s opinion, it must have been so material or substantial as to have governed the award. Id. at 443.
B
The circuit court’s determination in this matter was made in response to a motion for summary disposition under MCR 2.116(C)(10). Therefore, our review of that determination is de novo. See Kentwood Public Schools v Kent Co Ed Ass’n, 206 Mich App 161, 164; 520 NW2d 682 (1994).
m
At the outset, we note that we are not deciding whether the arbitrator properly applied the joint-employer doctrine to the facts of this case in the abstract. The issue before us is much more narrow and limited: whether the joint-employer doctrine is applicable when the parties are two distinct governmental units, here the probate court and the county, each a member of a different branch of government. We hold that it is not applicable in that situation.
A
This Court has already determined that for the purposes of collective bargaining, probate court employees are not employees of the county in which the probate court exists; they are employees exclusively of the court. Cameron v Monroe Co Probate Court, 214 Mich App 681; 543 NW2d 71 (1995). Thus, any decision that holds the county to be an employer of the probate court employees is in error.
B
Further, we cannot agree with defendants’ argument that the probate court and the county, by sharing certain services, implicitly agreed to act as joint employers, thereby waiving the legal status of probate court employees as employees of the court only. We agree with the circuit court that such a result would violate the separation of governmental powers doctrine.
l
Our constitution provides:
The powers of government are divided into three branches: legislative, executive and judicial. No person exercising powers of one branch shall exercise powers properly belonging to another branch except as expressly provided in this constitution. [Const 1963, art 3, § 2.]
Although not all overlap in governmental functions is barred, People v Trinity, 189 Mich App 19, 22-23; 471 NW2d 626 (1991), intergovernmental sharing of power is permissible only where the area of one branch’s exercise of another branch’s power is very limited and specific. Id. at 23.
2
The application of the joint-employer doctrine to merge the county and the probate court into one employer threatens to disrupt the delicate balance between the judiciary’s right to control its employees and the county’s responsibility to fund the courts. See Wayne Circuit Judges v Wayne Co, 386 Mich 1; 190 NW2d 228 (1971). The potential for overreaching by the county in directing the affairs of the judiciary, or by the judiciary in compelling the county to appropriate funds, is too great; one branch of government would not be properly limited from exercising the power of the other, thereby eliminating the necessary distinction between the two branches for collective bargaining purposes.
Thus, applying the joint-employer doctrine in the present context would impermissibly allow the county to exercise the powers of the probate court and the probate court to exercise the powers of the county. See Wayne Circuit Judges, supra; Cameron, supra.
3
We hold that the joint-employer doctrine may not be applied to merge two distinct governmental units — one a part of the judicial branch of government, the other clearly not — into a single employer for the purposes of public employment.
IV
We affirm the circuit court’s vacation of the arbitrator’s initial award. We do not address the arbitrator’s award on remand because neither party appealed that award.
Affirmed.
The joint-employer doctrine is used to enforce a collectively bargained agreement against a non-signatory when the four general characteristics of an employer are met: (1) the power to select and engage the employee, (2) payment of wages, (3) the power of dismissal, and (4) power and control over the employee’s conduct. Michigan Council 25, AFSCME v Louisiana Homes, Inc, 192 Mich App 187, 190; 480 NW2d 280 (1991), vacated and remanded 441 Mich 883 (1992), reaffirmed (On Remand), 203 Mich App 213; 511 NW2d 696 (1994). We are somewhat at a loss to understand why the arbitrator employed the joint-employer doctrine to initially decide this case because he had full authority to fashion a remedy within the four comers of the collective bargaining agreement. However, the issue having been raised and decided by the circuit court, we must now address it.
While the probate court is clearly a part of the judicial branch of government, the county is not Counties are established in the constitution and derive their powers from the Legislature, having no general or inher ent powers. They perform no judicial functions. Const 1963, art 7, § 1. Crain v Gibson, 73 Mich App 192, 200; 250 NW2d 792 (1977). | [
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] |
White, P.J.
The instant deficiency action was brought by plaintiff, the assignee bank under a motor vehicle retail installment sales contract, against defendant, a co-buyer for the purchaser, following repossession and sale of the vehicle. The question is whether the applicable limitation period is four years as set forth in § 2-725 of the Uniform Commercial Code (UCC), MCL 440.2725(1); MSA 19.2725(1), or she years as generally applicable to contract claims, MCL 600.5807(8); MSA 27A.5807(8). We conclude that a deficiency action, although arising from both a sale of goods and a secured transaction, relates primarily to the sales aspect of the transaction and is thus subject to Article 2’s four-year statute of limitations.
i
The facts are undisputed. On October 20, 1987, defendant signed a Motor Vehicle Retail Installment Sales Contract as a co-buyer for Jacqueline I. Jones, who is not a party to this action. The contract stated in several places that plaintiff was the assignee.
Jones failed to make payments after August 1988, as required under the contract, and on November 18, 1988, plaintiff repossessed the vehicle. On November 28, 1988, plaintiff declared the loan to be in default and charged off the amount claimed due. On March 1, 1993, plaintiff filed the instant suit in the district court to collect the deficiency remaining after the sale of the vehicle. It is undisputed that plaintiff did not bring this action until more than four years after the breach of contract.
Defendant moved for summary disposition under MCR 2.116(C)(7) on the basis that plaintiffs deficiency claim was barred by the UCC Article 2 four-year statute of limitations. The district court denied the motion, ruling the general six-year statute of limitations for contract claims applied. The circuit court, after hearing argument, entered an order granting defendant leave to appeal and simultaneously affirming the district court’s ruling. We granted leave for delayed appeal, and now reverse.
H
Our review of the circuit court’s affirmance of the district court’s denial of defendant’s motion for summary disposition, and of this question of law involving statutory interpretation, is de novo. Kellogg Co v Dep’t of Treasury, 204 Mich App 489, 492; 516 NW2d 108 (1994); Saraski v Dexter Davison Kosher Meat & Poultry, 206 Mich App 347, 351; 520 NW2d 383 (1994).
Defendant argues that plaintiffs suit to recover a repossession deficiency more than four years after the buyer’s default is barred under ucc Article 2-Sales, MCL 440.2101 et seq.) MSA 19.2101 et seq. Plaintiff argues that the ucc does not apply because plaintiff was not a “seller” and defendant was not a “buyer” as defined in the ucc, § 2-103(l)(a) and (d), and there was no passing of title from plaintiff to defendant under § 2-106. Plaintiff argues that the automobile dealership was the seller, defendant was a guarantor, not a buyer, and plaintiff was “strictly a secured party in the transaction or a financing agency as defined at MCL 440.1201(37) [MSA 19.1201(37)].” We reject plaintiff’s arguments.
A
The UCC defines “buyer” as “a person who buys or contracts to buy goods,” MCL 440.2103(l)(a); MSA 19.2103(l)(a). The contract in this case defines “buyer” as each person who signs the Buyer’s Agreement, a designated section of the contract. Defendant signed the Buyer’s Agreement as a buyer. The contract makes no distinction between Jones and defendant as buyers. Plaintiff argues that, notwithstanding that the contract declares defendant to be a buyer, because defendant signed a separate document, entitled “Notice to Cosigner,” he is not a buyer, but a guarantor of the debt. This notice states:
You are being asked to guarantee this debt. Think carefully before you do. If the buyer/borrower doesn’t pay the debt, you will have to. Be sure you can afford to pay if you have to, and that you want to accept this responsibility.
You may have to pay the full amount of the debt if the buyer/borrower does not pay. You may also have to pay late fees or collection costs, which increase this amount.
The creditor can collect this debt from you without first trying to collect from the buyer/borrower. The creditor can use the same collection methods against you that can be used against the buyer/borrower, such as suing you, garnishing your wages, etc. If this debt is ever in default, that fact may become a part of your credit record.
This notice is not the contract that makes you liable for the debt.
This notice states quite clearly that it is not the contract that makes the signer liable for the debt. The notice is simply a warning and has no legal effect. The operative document is the retail sales agreement, which clearly provides that defendant is a buyer.
B
The ucc defines “seller” as a “person who sells or contracts to sell goods.” MCL 440.2103(l)(d); MSA 19.2103(l)(d). Defendant asserts that plaintiff is the seller’s assignee.* Plaintiff asserts that while the Retail Installment Sales Act, MCL 445.851 et seq.; MSA 19.416(101) et seq., may provide that a defense may be raised against an assignee, the act is not applicable in this case because there was no assignment of the contract. Plaintiff asserts it is not an assignee, but a secured party and financing agent.
The contract defines “we,” “us,” “our,” and the “dealer” as “the dealer whose name appears on the other side [page one] or anyone to whom the dealer’s interest in this contract is assigned.” The contract is on a standard form imprinted with plaintiff’s name, address, and logo. At the top of page one, the contract states, “The dealer will assign this agreement to the bank.” On the same page, the dealer’s signature appears under “Dealer’s Acceptance,” which reads: “The dealer accepts this contract and assigns it to the bank. The dealer agrees to all of the terms of the assignment on the other side.” Page one of the contract further states under “Notice of Assignment”: “The dealer has assigned this contract to the bank. You must make all future payments to the bank. The dealer is making the disclosures in this contract.”
Despite these references to assignment and the signature of the dealer on page one of the contract, plaintiff argues there was no assignment because a separate section of the contract at the bottom of page two, entitled “The following assignment is not part of the buyer’s agreement,” was not signed by the dealer. This section states the terms of the assignment and additionally provides: “The dealer shall also be liable to the bank as indicated in the following paragraphs if the dealer has signed below.” Thus, by the contract’s terms, the dealer’s failure to sign this section has no effect on the buyer’s agreement and means simply that the additional provisions expressed in that section regarding indemnification of the bank by the dealer do not apply. Nothing in the contract indicates that failure to sign that particular section negates the assignment. Finally, we note that plaintiff fails to explain how it has a right to relief if not by virtue of being an assignee under the contract. We conclude that plaintiff is an assignee under the contract.
An assignee stands in the shoes of the assignor and acquires the same rights as the assignor possessed. In re Forfeiture of $126,174, 191 Mich App 453, 456; 479 NW2d 8 (1991). Plaintiff thus stands in the shoes of the seller, and is not simply a financing agent. Further, the contract provides:
Any holder of this Consumer Credit Contract is subject to all claims and defenses which the debtor could assert against the seller of goods or services obtained pursuant hereto or with the proceeds hereof.
We conclude that plaintiff is subject to the same defenses to this deficiency suit, including the statute of limitations, as the seller would have been.
c
The question remains whether the four-year statute of limitations of § 2-725 of the ucc applies. Plaintiff argues, and both the district and the circuit court agreed, that this action is governed by the general six-year statute of limitations governing contract claims. MCL 600.5807(8); MSA 27A.5807(8).
Section 2-725 of the UCC provides in part:
An action for breach of any contract for sale must be commenced within 4 years after the cause of action has accrued.
The issue presented is discussed in anno: Application, to security aspects of sales contract, of UCC § 2-725 limiting time for bringing actions for breach of sales contract, 16 ALR 4th 1335, 1336:
The absence of a statute of limitations in Article 9 [Secured Transactions] of the Uniform Commercial Code which generally governs secured transactions has given rise to disputes as to whether the security aspects of sales contracts should be governed by § 2-725, which is the statute of limitations provided in Article 2 of the Code governing sales generally, or whether some other statute of limitations provided elsewhere under state law should be applied.
The annotation discusses a number of cases, four of which are also cited by defendant, for the proposition that, with respect to a deficiency action brought by a creditor following repossession and sale of the good purchased subject to a security agreement, the four-year statute of limitations applies because the suit relates primarily to the sales aspects, and not the security aspects, of the transaction.
In Associates Discount Corp v Palmer, 47 NJ 183, 187; 219 A2d 858 (1966), the New Jersey Supreme Court held that a Pennsylvania code provision identical to MCL 440.2725(1); MSA 19.2725(1) controlled a financing bank’s right to maintain an action for deficiency, following the resale of a vehicle, and rejected an argument plaintiff makes here by implication— that its suit arises out of the security agreement in the contract:
The “bailment lease” signed by the defendant is a combination, all inclusive instrument, constituting both a contract for sale and a security transaction. It has been suggested by the concurring opinion that an action for a deficiency is not governed by [ucc] 2-275 on the theory that such action is part of the security arrangement between the parties rather than an incident of the sales aspect of their agreement. However, we think this view mistakes the true character of a deficiency suit. Such a suit is nothing but a simple in personam action for that part of the sales price which remains unpaid after the seller has exhausted his rights under Article 9 by selling the collateral; it is an action to enforce the obligation of the buyers to pay the full sale price to the seller, an obligation which is an essential element of all sales and which exists whether or not the sale is accompanied by a security arrangement. Thus, because of the absence of a contrary indication anywhere in the Code, a deficiency action must be considered more closely related to the sales aspect of a combination sales-security agree ment rather than to its security aspect and be controlled by the four year limitation. [47 NJ 187 (citation omitted).]
This view was adopted by the California Court of Appeals in Massey-Ferguson Credit Corp v Causalong, 62 Cal App 3d 1026, 1027; 133 Cal Rptr 497 (1976) (deficiency action arising from the sale of farming equipment sold and later repossessed). The Causalong court stressed, as set forth in the UCC’s official comment present in the codes of California and Michigan, that in contracts containing security transactions, Article 2 governs the general sales aspects of the transaction, and adopted the Palmer court’s reasoning that an action for a deficiency judgment involves the “general sales aspect” of a secured transaction. Id. at 1028.
In Citizen’s Nat’l Bank of Decatur v Farmer, 77 Ill App 3d 56; 32 Ill Dec 740; 395 NE2d 1121 (1979), a bank, as assignee, sued a defaulting buyer of an automobile for the balance due on a retail installment sales contract. The bank argued that a ten-year statute of limitations applied, rather than the four-year UCC period. The court rejected the bank’s argument, similar to plaintiff’s here, that the defendant’s breach was not of a sales contract, but of an obligation to pay the bank, and thus between debtor and creditor. The court cited Palmer for the proposition that deficiency actions are actions to enforce the obligation of the buyer to pay the full sales price, thus the four-year limitation applied. Id. at 58-59.
The UCC’s four-year limitation period has been applied by other courts under similar circumstances. See Wheel Estate Corp v Webb, 139 Ariz App 506, 508; 679 P2d 529 (1983) (suit by assignee of a security interest in mobile home against purchasers under sales contract); Worrel v Farmers Bank, 430 A2d 469, 471 (Del, 1981) (deficiency suit by bank following debtor’s breach of an installment sale agreement); Mobile Discount Corp v Price, 99 Nev 19; 656 P2d 851 (1983) (suit by assignee against purchasers following repossession and sale of mobile home); and Jack Heskett Lincoln-Mercury, Inc, v Metcalf, 158 Cal App 3d 38; 204 Cal Rptr 355 (1984) (deficiency suit by seller against defaulting buyer following repossession and sale of vehicle).
One case reaching the contrary result is factually distinguishable and, in fact, explicitly recognized the propriety of Palmer’s holding. Chaney v Fields Chevrolet Co, 264 Or 21; 503 P2d 1239 (1972), involved an action by a buyer of an automobile for excess proceeds from the resale of the auto following repossession. The Chaney court noted that Article 9 of Oregon’s Commercial Code provides that when the secured party sells the collateral after repossession from the debtor, it must account to the debtor for any surplus. Id. at 28. The court then distinguished the facts before it from those in Palmer, and acknowledged the propriety of Palmer’s holding:
Although an action for part of the purchase price is more closely related to the sale portion of the contract than it is to the security portion, it is obvious that an action to recover a surplus from the resale of the article upon an agreed foreclosure is more closely related to the security aspects of the contract than it is to that part which concerns the original sale. The right is created by ORS 79.5040, a part of Article 9 of the Uniform Commercial Code, which relates to secured transactions, and not by ORS 72.7250, a part of Article 2, which relates to sales. [Id. at 25.]
We conclude that Palmer and its progeny are persuasive.
While acknowledging defendant’s discussion of case law in other jurisdictions supporting defendant’s position, plaintiff asserts that “Michigan is presently in conformity with a large majority of jurisdictions which have not applied this particular section [§ 2-725] to the facts contained in the instant case.” However, plaintiff fails to cite a single case in support of this proposition. In fact, plaintiff cites only two cases in its entire brief. One case, Burton v Artery Co, Inc, 279 Md 94; 367 A2d 935 (1977), which was followed by the Citizen’s Bank court, is cited by plaintiff as distinguishable. The other case, Fries v Holland Hitch Co, 12 Mich App 178, 185; 162 NW2d 672 (1968), is inapplicable. Fries, a breach of warranty action against the manufacturer of a trailer rig, held that the three-year limitation period governing tort claims applied, because no express contract was alleged and the complaint was couched in terms of a tortious wrong. There is no mention of a security interest being involved, and the case was governed by pre-ucc law. Id. at 180, n *
We reverse the circuit court’s affirmance of the district court’s denial of defendant’s motion for summary disposition and order that judgment be entered for defendant.
That provision defines security interest as “an interest in personal property or fixtures which secures payment or performance of an obligation.” “Financing agency” is defined in Article 2, MCL 440.2104(2); MSA 19.2104(2), as
a bank, finance company or other person who in the ordinary course of business makes advances against goods or documents of title or who by arrangement with either the seller or the buyer intervenes in ordinary course to make or collect payment due or claimed under the contract for sale, as by purchasing or paying the sellers draft or making advances against it or by merely taking it for collection whether or not document of title accompany the draft. . . [and] includes also a bank or other person who similarly intervenes between persons who are in the position of seller and buyer in respect to the goods (section 2707).
Section 2707 is entitled “Person in the position of a seller,” and defines such a person as including “as against a principal an agent who has paid or become responsible for the price of goods on behalf of his principal or anyone who otherwise holds a security interest or other right in goods similar to that of a seller.” MCL 440.2707(1); MSA 19.2707(1).
Assignability is sanctioned under the ucc as a “normal and permissible incident!] of a contract for the sale of goods.” See comment to § 2-210. Section 2-210 states in pertinent part:
(2) Unless otherwise agreed all rights of either seller or buyer can be assigned except where the assignment would materially change the duty of the other party, or increase materially the burden or risk imposed on him by his contract, or impair materially his chance of obtaining return performance. [MCL 440.2210; MSA 19.2210.]
Defendant additionally argues that this contract falls under the Retail Installment Sales Act, (mrisa), MCL 445.851 et seq.\ MSA 19.416(101) et seq., under which an assignee is considered a “holder” of such an instrument, MCL 445.852(n); MSA 19.416(102)(n), and subject to all claims and defenses available to the buyer. MCL 445.865(d); MSA 19.416(115)(d). Plaintiff does not dispute that the contract falls under the mrisa, but argues it is inapplicable because plaintiff is not an assignee.
The only case we have found directly contrary to Palmer is North Carolina Nat’l Bank v Holshouser, 38 NC App 165; 247 SE2d 645 (1978), in which the court, although recognizing the dual nature of sales contracts involving a security arrangement, held that a deficiency action is more closely related to the security aspect of the contract, and concluded that Article 9 must govern. Holshouser is distinguishable because a sealed instrument was involved, and there was apparently an issue regarding passing of title, which is governed by Article 9 under § 2-401 of the Georgia (and Michigan) ucc. More important, one of the bases on which the Holshouser court rejected Palmer was a North Carolina Comment following its version of Michigan’s MCL 440.2102; MSA 19.2102, which defines the scope of Article 2. Although the Official ucc Comment following this provision was identical to Michigan’s, the North Carolina Comment immediately following it stated:
This section sets out the scope of the Code, limiting it to transactions in goods . . . and indicates that the article on sales does not apply to transactions intended as security even though in the form of an unconditional contract of sale or to sell. The section also makes clear that the sales article does not impair or repeal any statute regulating sales to consumers, farmers or other specified classes of buyers. [38 NC App 167.]
The court noted that its deference to Article 9 “where a security interest is involved is consistent with the language and Comments of G.S. § 25-2-102.” Id. at 169. In rejecting Palmer, the Holshouser court noted that the official comments to the Pennsylvania statute involved in Palmer (which are equivalent to Michigan’s) stated:
Since transactions intended to operate “only” as security transactions are excluded, actual sales are subject to this Article of the Code [Article 2 — Sales], although a security interest is retained. [Id. at 171.]
The Holshouser court thus concluded:
[I]t is apparent that the [Palmer] court reached its decision largely on the basis of what the Pennsylvania Legislature expressed as its intent in enacting the statute in question. The comments under the analogous section of the Code in North Carolina (G.S. § 25-2-102) express an intent precisely contrary to that of the Pennsylvania Legislature, and we accordingly do not adopt the holding of the Associates case, however correct it may be within the context of those statutes before the New Jersey court. [Id. at 171.] | [
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Per Curiam.
This case presents an issue of first impression in this state: Does an heir of a decedent or the personal representative of the decedent’s estate, which includes personal property that was seized under MCL 333.7521; MSA 14.15(7521) after the decedent’s death, have standing to assert an innocent owner defense against the in rem forfeiture? We answer this question in the affirmative.
i
Michael Tufnell was killed on August 8, 1993; he was unmarried, had no children surviving him, and died intestate. Claimants Weller and Dorothy Tufnell, as Michael’s parents, were his sole heirs. On September 14, 1993, Weller Tufnell was named the personal representative of his son’s estate.
On August 11, 1993, the Midland County Sheriff’s Department had executed a search warrant at Michael Tufnell’s storage garage, seizing $234,200 in currency, a 1965 Ford Mustang, thirty-five collectable comic books, twelve boxes containing approximately 1,400 collectable baseball cards, a triple-beam scale, marijuana, and an electronic scale. Pursuant to MCL 333.7521; MSA 14.15(7521), the Midland County Prosecuting Attorney initiated forfeiture proceedings, naming claimants as potentially interested parties. The prosecutor alleged that an investigation had revealed that Michael Tufnell was a distributor of cocaine and marijuana. Claimants filed a response, asserting various affirmative defenses, including that the search and seizure were unlawful and that, as Michael Tufnell’s heirs at law and Weller Tufnell as personal representative of Michael’s estate, claimants were “innocent owners” under MCL 333.7521(l)(f); MSA 14.15(7521)(l)(f).
Claimants moved for summary disposition pursuant to MCR 2.116(C)(7) and (10), arguing that because they were innocent owners the seized property was not forfeitable. In separate affidavits, both claimants averred that they had no knowledge of any drug dealing by their son. The prosecutor’s written response to claimants’ motion asserted that claimants were “not entitled to an innocent owner defense.” At the motion hearing, the trial court concluded that, as a matter of law, claimants did not have standing in their capacity as heirs or Weller TufnelTs capacity as personal representative of the estate to assert a claim as innocent owners under the forfeiture statute. The court reasoned that claimants had no ownership interest that could ripen into a claim of innocent ownership. Furthermore, the court concluded that, even if a relation-back principle were applied, any ownership interest of the claimants would relate back “to a time in which they had absolutely no interest.” The court entered an order granting summary disposition to the prosecutor, and claimants now appeal as of right.
n
Michigan law provides that anything of value that is used to facilitate a violation of the controlled substances act or that can be traced to an exchange for a controlled substance is subject to forfeiture under MCL 333.7621(1)00; MSA 14.15(7521)(l)(f). However, the statute provides an important limitation of the state’s broad forfeiture power:
To the extent of the interest of an owner, a thing of value is not subject to forfeiture under this subdivision by reason of any act or omission that is established by the owner of the item to have been committed or omitted without the owner’s knowledge or consent.
To determine whether claimants have standing to assert an innocent owner defense against the forfeiture, we must define claimants’ property interest, if any, according to established Michigan common law, and then determine whether that ownership interest is sufficient under § 7521 to confer standing to assert an innocent owner defense.
In Michigan, legal title to personal property of a decedent, testate or intestate, vests in the personal representative until the estate is fully settled and distributed, or the property is otherwise disposed of. Equitable title to the property vests in the decedent’s heirs at the time of death, subject to the rights of creditors and the expenses of administration. Hay v Hay, 317 Mich 370, 386-387; 26 NW2d 908 (1947); Glass v Crossman, 289 Mich 130, 138-139; 286 NW 184 (1939).
Because the term “owner” in the Michigan forfeiture statute is not statutorily defined, we must interpret the term according to its commonly used meaning. This Court has broadly defined the term to include a putative claimant who has no certificate of legal title, but has a recognizable interest. For example, in In re Forfeiture of $11,800, 174 Mich App 727; 436 NW2d 449 (1989), this Court concluded that an employee with a possessory interest in $8,000 given to him by his employer had standing to challenge its forfeiture where the money had been taken by his housemate without permission. Id. at 728-731. See also In re Forfeiture of $53, 178 Mich App 480, 493; 444 NW2d 182 (1989) (an “owner’s” interest “may take on different forms, i.e., legal title or even equitable title”).
In a factually similar case, the Illinois Court of Appeals interpreted the term “owner” under that state’s “innocent owner” provision of the forfeiture statute to include the personal representative and the beneficiary of an alleged drug offender’s estate:
The word “owner” may be used to describe one who has dominion or control over a thing, the title to which is in another. (Black’s Law Dictionary 1259 (4th, ed 1951).) We do not believe it could be seriously argued that a decedent’s administrator was not entitled to have “dominion or control” over the contents of the decedent’s safety deposit box. An “owner” has also been defined as “one that has the legal title or rightful title whether he is the possessor or not.” (Webster’s Third New International Dictionary 1612 (1981).) The administrator of a decedent’s estate takes title as trustee for the payment of just claims and administration.
The word “owner” is nomen generalissimum, and its meaning is to be gathered from the connection in which it is used and from the subject matter to which it is applied and, when used in a statute, the obvious nature and purpose of the statute may indicate its meaning. Application of this maxim would lead to the conclusion that the word “owner” was intended by the legislature to mean the personal representative and the beneficiaries of decedent’s estate in the context of the instant case. It was apparent that the legislature intended to permit proof that the owner of the property found in proximity to the forfeitable substance did not have knowledge or did not consent to the act or omission of the exchange of the money and the substance. If, as the State alleges, only the decedent qualified as the “owner” of the property, the exemption would be a nullity. Under the exemption only the “owner” can prove the lack of knowledge or consent. Obviously, a decedent could not make such proof. Further, since it is the lack of knowledge or consent of the “owner” that is essential to prove the exemption, if only the decedent was the “owner,” then, in the instant case, the language creating the exemption would be surplusage. However, statutes are to be interpreted so as to give effect to all of their provisions and not so rigidly as to defeat legislative intent.
We conclude that the administrator of the estate of Kaymond Kawa was the owner of the contents of the safety deposit box. It follows that as “owner” the administrator was qualified to prove that none of the money was subject to forfeiture, to the extent of his interest in the money as administrator, by reason of any act or omission which the administrator proves to have been committed or omitted without the administrator’s knowledge or consent .... [People ex rel Foreman v Estate of Kawa, 152 Ill App 3d 792, 798-799; 105 Ill Dec 698; 504 NE2d 983 (1987) (citations omitted).]
We agree with the Kawa court’s analysis. Thus, in this case, claimants, as personal representative of Michael’s estate and as their son’s sole heirs at law, were vested with a recognizable ownership interest in the property at the time it was seized and the interest was sufficient to confer standing under the innocent owner provision in § 7521(l)(f).
The prosecutor contends, however, that claimants have no standing to assert an innocent owner defense because any interest they did have as personal representative or heirs vested after the property became subject to forfeiture as a result of Michael Tufnell’s alleged illegal drug activities. The prosecutor asserts that, at the time of the illegal conduct, claimants’ interest was a mere expectancy, which was insufficient to constitute ownership under the forfeiture statute. We reject this argument.
The Michigan forfeiture statute does not preclude property rights from existing in property subject to forfeiture. In re Forfeiture of $11,800, supra at 731. Notwithstanding differences in statutory language, the United States Supreme Court has interpreted the federal forfeiture statute to preclude retroactive vesting of title in the government until a judgment of forfeiture is obtained. In United States v 92 Buena Vista Ave, 507 US 111; 113 S Ct 1126; 122 L Ed 2d 469, 482 (1993), a drug trafficker gave $240,000 in illegal drug proceeds to his girlfriend as a gift, and she used the money to purchase a home that was seized under the federal forfeiture statute. The government asserted that the federal statute — which, unlike the Michigan statute, provides in 21 USC 881(a) that “no property right shall exist” in property subject to forfeiture, and further embodies an express relation-back provision in 21 USC 881(h) that “all right, title and interest in property described in subsection (a) . . . shall vest in the United States upon commission of the act giving rise to forfeiture under this section” — vested ownership of the property in the United States at the moment when the proceeds of the illegal drug transaction were used to pay the property’s purchase price, thereby preventing the claimant from ever becoming an “owner.” In rejecting the government’s interpretation of the federal statute, the Buena Vista Court held that neither the statutory nor the common-law relation-back doctrine vests the government with ownership of the property until a judgment of forfeiture is obtained. Thus, a transferee who unknowingly obtains proceeds from an illegal drug transaction is not precluded from asserting an innocent owner defense. Buena Vista, supra at 129 (Stevens, J.), 134-135 (Scalia, J.). The Court reasoned that, because someone must own the property between the time that the illegal act occurs and the time that forfeiture is decreed, an innocent transferee may obtain an ownership interest in the property during that period. The innocent owner may then contest the forfeiture, thereby preventing the government’s title from vesting and preventing the relation-back doctrine from ever arising. Thus, in accordance with Buena Vista and In re Forfeiture of $11,800, a putative claimant’s ownership interest may arise after the occurrence of the illegal conduct that subjects the property to forfeiture.
Accordingly, we conclude that claimant Weller Tufnell, as personal representative, was vested with legal title to the personal property of his son’s estate, and that he may assert an innocent owner defense to the extent that the property is needed to satisfy the estate’s legitimate creditors and the expenses of estate administration. See City of Bellevue v Cashier’s Check for $51,000, 70 Wash App 697, 704; 855 P2d 330 (1993). As personal representative, claimant Weller Tufnell stands in the shoes of decedent and is legally entitled to challenge the prosecutor’s forfeiture action by asserting any claim that Michael Tufnell could have made if he were alive, including that of an innocent owner. We further conclude that claimants, as their son’s heirs at law, were vested with equitable title to his personal property upon his death and that they held this title even though they did not know of the existence of the specific property seized. Thus, claimants also have standing in their individual capacity to challenge the forfeiture of the property.
Claimants, in support of their motion for summary disposition, submitted affidavits averring that they had no knowledge of their son’s alleged drug activities when he died intestate and they became vested by operation of law with a recognizable ownership interest in his estate. The prosecutor’s untimely written response to claimants’ motion alleged that claimants were “not entitled to an innocent owner defense.” The prosecutor alleged that “information has been provided through [law enforcement investigative] reports . . . implicating] the claimants in Michael Tufuell’s drug dealing.” The prosecutor offered no documentary support for this claim, as required by MCR 2.116(G)(4), but, at the motion hearing, the assistant prosecutor explained his reluctance to provide claimants’ counsel.with a copy of the investigative reports because of the pending criminal case involving Michael Tufhell’s homicide. The trial court granted summary disposition in favor of the prosecutor, finding as a matter of law that claimants lacked standing to assert an innocent owner defense. Having now determined that the trial court erred in its ruling, we remand to permit the prosecutor an opportunity to produce “clear and decisive evidence” negating claimants’ affirmative defense that they are innocent owners to the extent of their respective interests as personal representative and heirs. See Palenkas v Beaumont Hosp, 432 Mich 527, 550; 443 NW2d 354 (1989) (Archer, J). In the event that the prosecutor fails to raise a genuine issue of fact with respect to claimants’ status as innocent owners, the trial court may enter judgment for claimants as set forth in MCR 2.116(G)(4).
Reversed and remanded.
Contrary to the prosecutor’s contention, claimants did not concede at the summary disposition hearing that the prosecutor was entitled to forfeiture. Rather, it appears to us that claimants’ counsel was merely acknowledging the trial court’s adverse decision and seeking a final order from which to take an immediate appeal to this Court, thereby avoiding an imminent forfeiture trial at which claimants’ innocent owner defense would not be adjudicated.
On objection by claimants’ counsel to the prosecutor “rais[ing] the issue without an affidavit,” the prosecutor explained:
For purposes of this [motion], [the lack of evidentiary support is] a nonissue. And-and the reason I didn’t answer by affidavit is because I see this as purely a legal question as to whether they are innocent owners or not and so I felt that it wasn’t necessary for me to do any type of factual affidavit.
I mean, [claimants’ counsel] phrases it in terms of that it’s - it’s a factual issue. It’s not; it’s a matter of law. Is the heir under the case law entitled to an innocent owner, is it an owner. I say no. | [
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Sharpe, J.
This is a suit to restrain defendants from building upon or occupying certain premises and for an order quieting title to the property.
In 1864, Morgan Allen was the owner of the northeast quarter of section 24, town 9 north, of range 11 west, Kent county. On September 28th of that year he executed a lease to the school district of a piece of land 10 rods square in the northeast corner of the above-described quarter section “to have and to hold the same for a school house site as long as occupied for school purposes.-” On October 10, 1864, Allen and wife executed a warranty deed to John D. Miller of the above-described premises “except 10 rods square lying in the northeast corner, which is leased to the school district as long as occupied for school purposes, with the right to occupy only.” Title to the east half of the quarter section finally came to rest in the First National Bank of Detroit which sold it on a land contract on June 27, 1938, to plaintiffs’ assignors. The'land contract contains the provision “except 10 rods square in the northeast corner for school house.” The school site was abandoned by the school district in about 1935.
Defendant Dewey E. Jewell is one of the direct heirs of Morgan Allen. He acquired by deeds the interest of all the known heirs of Morgan Allen, a quitclaim deed from the school district; and on December 29, 1939, he obtained a decree quieting title to the property leased for school purposes. In the spring of 1940, Jewell moved a house-trailer onto the premises.
Thereafter, plaintiffs filed their bill of complaint and alleged that the proceedings taken by Jewell to quiet title were void because no personal notice’ was given to plaintiffs or their predecessors in title. Defendants filed an answer and also a motion to dismiss plaintiffs’ bill of complaint. The trial court dismissed plaintiffs’ bill of complaint on the ground that Morgan Allen had never conveyed the school site, but had excepted it from the description in the deed when he sold the premises to John Miller.
Plaintiffs appeal and contend that the instrument executed by Allen to the school district was a lease and created the relationship of landlord and tenant which terminated when the premises were abandoned for school purposes; and that Morgan Allen and wife intended by their deed to convey to Miller the whole quarter section without excepting the piece of property leased for school purposes.
It is a general rule that in interpreting deeds and other written instruments, the primary object is to determine the intention of the parties from the instrument itself. If the instrument indicates an ambiguity, then resort may be had to extraneous m&ttors
In Derham v. Hovey, 195 Mich. 243, 247 (21 A. L. R. 999), we said:
“In interpreting devises and reservations in deeds, the purpose is to discern the intention of the testator, or grantor from the words employed; the subject matter and attending circumstances to be considered where the words have a doubtful meaning. ’ ’
In Peck v. McClelland, 247 Mich. 369, one McClelland owned a piece of land. He sold a part of it:
“excepting and reserving a strip of land across the south end of the said lot, 14 feet wide running east and west for an alley, a right of way from the south end of said above devised premises to Saginaw street is granted by first parties to second party.”
Another parcel of land was sold:
‘ ‘ excepting and reserving from the above-described premises a strip of land on the south side thereof, 14 feet wide, as an alley or right of way for second parties from the south side of the above-devised premises to Saginaw street in the said village.”
Later he conveyed another parcel of land:
‘ ‘ reserving a strip of land 14 feet wide off the south end of above-described land for alley.”
The exceptions and reservation formed a continuous strip of land. By mesne conveyances all of the land out of which the exceptions and reservation were made merged in plaintiff, who claimed that the language created an easement only. Defendants claimed that the 14-foot strip of land belonged to McClelland; that he never parted with title thereto and on his death passed to his heirs. The court said:
“ ‘If the grantor, no matter what the words may be, retains in himself title to a part of the land described in the deed, it is an exception. In such case words of inheritance are not necessary to retain in him the title for himself and his heirs. This is reasonable, because the deed did not purport to convey the title to the part excepted, nor to devest him of it. “Whatever is excluded from the grant by exception remains in the grantor as of his former title or right.” ’ Negaunee Iron Co. v. Iron Cliffs Co., 134 Mich. 264.
“By the deeds here involved, there is an exception of the 14-foot strip. It is not conveyed by the grantor to the grantee in any deed. A right of way over this 14-foot strip was given by the grantor to the grantee but the fee was retained by the grantor.
‘ ‘ ‘A grantor who states in his deed that he excepts a certain portion of the land because he wants it for a certain purpose cannot be held to have conveyed that which he has expressly excluded because he afterwards devotes it to a different purpose.’ Mayor, etc., of New York v. Railroad Co., 69 Hun, 324 (23 N. Y. Supp. 562); Delano v. Luedinghaus, 70 Wash. 573 (127 Pac. 197).
“If this 14-foot strip was excepted from the deeds of McClelland, the title thereto remained in birrij and, upon his death, passed to his heirs, subject to the easement.”
In Moore v. Kimball, 291 Mich. 455, 461, we said:
# “Where the language of an agreement is susceptible to more than one meaning, it is construed in the light of circumstances surrounding its execution, the relation of the parties, the nature of the subject matter, and the apparent purpose in making the agreement; but these considerations do not apply when the language of the agreement leaves no doubt as to its meaning. In such a case, it must be considered without regard to extraneous facts. See 13 G. J. p. 544. The intention of the parties is to be deduced from the language employed by^them, The question is not what intention existed in the minds of the parties, but what intention was expressed in the language used; and where unambiguous, the terms of the restrictions are conclusive. ’ ’
In the case at bar, the instrument executed by Morgan Allen to the school district was a lease which terminated when the premises were abandoned for school purposes. The deed from Morgan Allen to Miller excepted the piece of property leased to the school district. There is no ambiguity in the words used and the rule permitting extrinsic evidence to explain the words used in the Miller deed has no application in this case. It follows that Morgan Allen having expressly excepted from the conveyance the land leased for school purposes, he kept the title of such leased property in himself. Plaintiffs’ vendor never acquired title to the school site, nor did it attempt to convey it to plaintiffs.
The decree of the chancery court is affirmed. Defendants may recover costs.
Chandler., C. J., and Boyles, North, Starr, Butzel, and Bushnell, JJ., concurred. Wiest, J., did not sit. | [
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North, J.
Upon hearing defendant’s motion to dismiss plaintiffs’ bill of complaint, the trial court permitted plaintiffs to amend. Thereafter defendant renewed its motion to dismiss. It was heard and granted on the ground that the amended bill of complaint did not state a cause of action. Plaintiffs have appealed. They seek relief because of two acts of defendant. One was that the foreclosure sale by defendant of plaintiffs’ mortgaged property was as two separate parcels whereas plaintiffs, possessing the rights of the mortgagors, claim it was only one parcel and should have been so sold. The other was the acceptance by defendant of the proceeds from the condemnation of part of the mortgaged property during the redemption period; which, plaintiffs claim, reinstated and put in full force and effect the mortgage involved herein.
Plaintiffs are Mary A. Schlaff, widow of Anthony Schlaff, deceased, and Viola E. Petoskey, administratrix of the estate of deceased. Mr. and Mrs. Schlaff purchased the premises herein involved in 1902. At that time they occupied a small house on the westerly portion of the lot. In 1912, they built a larger home on the easterly 60 feet of the lot and occupied it. Mrs. Schlaff is still living there. The smaller residence on the westerly 4ft feet of the lot has been rented to tenants. On January 24, 1934, Mr. and Mrs. Schlaff obtained’ a mortgage loan of $13,991.21 on their premises from defendant. This mortgage covered the entire lot described as: “Lot No. five (5) Detroit Arsenal Grounds, town 2 south, range 10 east.” Mortgagors being in default, defendant foreclosed the mortgage by advertisement.. A sheriff’s sale was held December 22,1939. Notice was served on plaintiffs that the property was to be sold. Apparently attempting to comply with the statute (3 Comp. Laws 1929, § 14431 [Stat. Ann. § 27.1227]), defendant at the foreclosure sale bought in the property by means of two bids, one for the easterly portion occupied by plaintiffs’ own home, and one for the westerly portion occupied by tenants. The statute above cited*is as follows:
“If the mortgaged premises consist of distinct farms, tracts, or lots not occupied as one parcel, they shall be sold separately, and no more farms, tracts, or lots shall be sold than shall be necessary to satisfy the amount due on such mortgage at the date of the notice of sale, with interest and the costs and expenses allowed by law but if distinct lots be occupied as one parcel, they may in such case be sold together. ’ ’
The sale in two parcels is claimed to be invalid by plaintiffs. They insist that the lot is but one unit and not two. The trial court based its decision principally on the ground that pláintiffs’ allegations in their bill show the lot was used as two separate parcels. However, plaintiffs do allege that the property was but one piece; and in pleading, inconsistent allegations are not fatal. Court Rule No. 17, § 6 (1933). See 1 Searl, Michigan Pleading and Practice, § 137. All facts well pleaded in a bill of complaint must be accepted as true under a motion to dismiss. Butts v. Ruthven, 292 Mich. 602. Therefore, we must assume that the property is but one piece.
The question of whether a sale of one piece of land as two parcels under foreclosure by advertisement is void is novel in this jurisdiction. It has been decided many times that if mortgaged premises consist of distinct tracts or lots they shall be sold separately, Jerome v. Coffin, 243 Mich. 324. The above-quoted statutory provision as to separate sales is for the benefit of the mortgagor. Keyes v. Sherwood, 71 Mich. 516. But in the instant case the situation is the converse of that covered by the statute. Plaintiffs herein complain of a statutory foreclosure sale of mortgaged property in two separate parcels which was mortgaged as a single parcel. Neither by the statute nor by any decision of this Court has such a sale been held ipso facto void or voidable. Plaintiffs are seeking relief in equity. They are not entitled to prevail unless some equitable ground of relief is alleged. Except plaintiffs assert in their pleadings that they have suffered damage by reason of the manner of the sale, they cannot be granted relief. One of the reasons assigned in defendant’s motion to dismiss plaintiffs’ amended bill of complaint is: “Because the amended bill of complaint sets forth no damage to plaintiff by reason of any of the acts alleged therein.” In granting the motion to dismiss, the circuit judge said: “And in any event the court is of the opinion that the plaintiff has failed to allege or demonstrate any damage resulting to it by reason of the sale in parcels.”
. Careful review of this record is convincing that the trial judge reached the correct conclusion. It clearly appears that in a practical sense the property could be and was occupied as two separate and dis tinct parcels. This is true notwithstanding the allegation that certain ontbnildings such as a barn, which was destroyed prior to this suit, a shed, et cetera, located on one .of the parcels were formerly used in connection with the other parcel. While the bill of complaint contains allegations that the mortgaged premises were sold for less than the fair value, this alone would not entitle plaintiffs to relief. The least that would constitute a cause of action under plaintiffs’ theory is a proper allegation of loss to plaintiffs caused by sale in two parcels instead of in a single parcel. The bill does not contain such an allegation. In so holding, we are mindful of the following allegation in the amended bill of complaint:
“That the defendant corporation in considering [sic] the sale of the premises as aforementioned damaged the plaintiffs to the extent that they not only lost their homestead and interest in said premises but that they were damaged to the extent that no one was interested in the purchase of the above-described premises for the reason of the manner in which the foreclosure sale was conducted by the sheriff, that is to say no one considered that after the sale was conducted that anyone could receive a proper title to the premises in two parcels instead of one and that for the reason that no one believed that your plaintiffs, if they did redeem, could give proper title, no one was interested in the purchase of the above-described premises.”
On every foreclosure, except there is redemption, the mortgaged property is lost notwithstanding it may have been a homestead. That portion of the quoted allegation which sets forth that no one during the period of redemption was willing to buy the property because good title could not be given obviously is merely an allegation of a conclusion which arose from a mistaken understanding of the law. Clearly either or both parcels could have been redeemed and good title restored to the mortgagors or their grantees. Defendant is not chargeable with the consequences of such an erroneous assumption as that alleged by plaintiffs.
While there may be instances where it would be injurious to a mortgagor to have a single lot sold as two separate parcels, plaintiffs here have not,alleged such an injury or damage. Plaintiffs have not alleged in their bill of complaint that the division of the property was physically impracticable or that selling in two parcels instead of one reduced the total sale value of the whole mortgaged property.
As to plaintiffs’ contention that defendant’s acceptance of a condemnation award for part of the property on June 17, 1940, which was during the redemption period, reinstated the mortgage, we think their position is not tenable. It is provided in the mortgage that any such award shall be applied on the mortgage debt. The provision reads:
“That in the event the premises or any part thereof are taken under the power of eminent domain, the entire award shall be paid to the mortgagees and applied upon the principal last maturing .hereon, and the mortgagee is hereby empowered in the name of the mortgagor or the mortgagor’s assigns to receive and give acquittances for any such award or judgment whether it be joint or several.”
In Shelby Co. v. Dickinson, 259 Mich. 197, and cases therein cited, it is held that the mere acceptance of money during the period of redemption does not invalidate a foreclosure sale unless there is an intent to do so. Such an intent is not alleged in the instant case. Further, it may be noted that the total amount of defendant’s bids at the foreclosure sale and the amount received as the condemnation award are less than the amount of the mortgage debt. De fendant’s acceptance of the condemnation award during the period of redemption did not, especially in view of the terms of the mortgage, invalidate the prior foreclosure proceedings.
In consequence of our conclusion above indicated, it is not essential to decision that we should pass upon appellee’s contention that plaintiffs’ delay in filing their bill of complaint until the second day prior to the expiration of the period of redemption renders them guilty of such laches as justified dismissal of their suit.
The decree entered in the circuit court is affirmed, with costs to appellee.
Chandler, C. J., and Boyles, Starr, Wiest, Butzel, Bushnell, and Sharpe, JJ., concurred. | [
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] |
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