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Per Curiam.
Defendant was first tried and convicted by a jury of first-degree murder on January 10, 1952. Because of error in the court’s instructions and in the form of the jury’s verdict, defendant’s motion for new trial was granted. Defendant was retried on the same charge and once again convicted. Defendant’s motion for directed verdict at the close of the proofs was denied. Defendant was sentenced to life imprisonment on April 5,1955.
Defendant’s delayed motion for new trial was denied in Oakland County Circuit Court on January 12, 1971. From the denial of the motion for new trial, defendant made application in this Court for a delayed appeal. That application was granted on May 12,1971.
Defendant’s brief sets out the facts which led to defendant’s conviction by carefully and accurately summarizing the testimony heard at trial. The people have accepted defendant’s statement of facts. We do not reach the issue raised by defendant on appeal for the reason that in order to support a conviction for first-degree murder, the prosecution must prove beyond a reasonable doubt that there was premeditation and deliberation and such a lapse of time as would give the mind time to calculate the purpose and intent of the killing. People v. Case, 7 Mich App 217 (1967); People v. Bergin, 16 Mich App 443 (1969). The prosecution introduced no evidence to support such a finding by the jury. Thus, the trial court should have granted defendant’s motion for directed verdict at least with regard to the charge of first-degree murder. In regard to first- degree murder, the verdict was against the great weight of the evidence since no evidence introduced at trial fairly supports an inference of premeditation and deliberation.
Under GCR 1963, 820.1, this Court, in its discretion, may “give any judgment and make any order which ought to have been given or made, and make such other and further orders and grant such relief, as the case may require”. Thus, this Court will grant the defendant’s motion for directed verdict at least on the charge of first-degree murder and reverse defendant’s conviction and remand it for a new trial. In such case, double jeopardy will attach and defendant cannot be retried on the charge of first-degree murder.
Reversed And remanded for proceedings consistent wjth this' opinion.
MCLA 750.316; MSA 28.548. | [
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] |
O’Hara, J.
Defendants appeal of right a judgment entered by the trial court ordering that two contracts of sale be rescinded and that an accounting of certain monies involved in the transaction be made.
Reduced to their common denominator, the defendants’ assignments of error may be thus phrased: whether on our de novo review the evidence clearly preponderates against the trial court’s finding that the contracts of sale should be rescinded because of defendants’ actionable fraud.
Two contracts of sale were necessary in this single transaction because one involved real property upon which the sellers operated a trailer coach park. This activity is regulated by the Michigan Department of Health. On the park site, the sellers also operated a retail store which was licensed for the sale of beer and wine. This license is commonly called an “S.D.M.” or specially designated merchant. This activity comes within the supervision of the Michigan Liquor Control Commission. When premises are licensed as above noted, transfer of the license requires Liquor Control Commission approval.
It is perfectly apparent to us that the two contracts were, in fact, and by the intention of the parties, one transaction.
The trailer park portion of the sale was closed on March 10, 1967; the part involving the retail store and the S.D.M. license was closed on May 17, 1967. In the interlude between the closings, health officials visited-the-camp site. The purchasers were not present on that occasion. The sales agreement had called for a transfer of a current health department license without any record of violations against it.
The state health representatives found that the drain field, a part of the septic tank system, was inadequate for the number of units the park serviced. There was water standing in the drain field, and the department officials informed the sellers that they could not continue operating the same number of units. There was insufficient area to enlarge the sewage system.
The sellers not only did not disclose this order to the purchasers, they affirmatively concealed it. They represented that the health officials only required covering the standing water with earth fill. They further told the purchasers not to apply for a health department license until the following year.
The record amply supports the finding that defendants fraudulently concealed existence of the septic field problem, and fraudulently induced plaintiffs to refrain from applying for a new license since such application would have brought these matters to light prior to completion of the sale of the store. In so doing, defendants breached their duty to disclose after-acquired information which rendered inaccurate or misleading prior representations which were true at the time originally made. See Strand v. Librascope, Inc. (ED Mich, 1961), 197 F Supp 743, 754.
We find the defense that the representations of the sellers were true when made, as opposed to the after-discovered infirmity violating the conditions of sale, singularly unpersuasive.
The trial court’s finding of actionable fraud finds adequate support in tbe record. Perforce, the order granting rescission was proper.
Affirmed. Costs to plaintiffs.
All concurred. | [
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Van Valkenburg, J.
This is a malicious prosecution action. At about 9 p.m. on October 8, 1965, plaintiffs went to the J. L. Hudson department store located at Westland Mall in Wayne County with the intent to pick up plaintiff Taft’s wife, who worked at that store. As plaintiffs entered the store they were approached by two men who indicated that the store was closed or was about to be closed. Plaintiff Cut-lip remained at the door while Taft went in search of his wife.
After Taft had proceeded about 50 feet into the store, he was met by defendant Bourgeous, who was in charge of security for the store. Bourgeous told Taft to leave, a request which Bourgeous claims was ignored by Taft. Bourgeous claims that Taft became boisterous, used profanity, and continued into the store. Bourgeous again approached Taft, whereupon Taft turned and left the store with Cut-lip.
As plaintiffs walked away, Bourgeous called the Westland Mall Security Department. Two officers were dispatched. These officers, upon ascertaining the identity of plaintiffs from Bourgeous, physically restrained plaintiffs, took them to the security office and held them until the sheriff’s deputies, who had been summoned, arrived. Plaintiffs were taken to the sheriff’s road patrol station, where they were released in a manner of minutes. Bourgeous thereafter swore out a complaint charging plaintiffs with being drunk and disorderly in a public place. At the trial on that complaint, the charges were dismissed at the close of the prosecution’s proofs.
Plaintiffs brought the present action for malicious prosecution and false arrest. While admitting to having consumed some four beers and two mixed drinks over the four-hour period prior to going to the store, plaintiffs deny that they were drunk and disorderly. The jury returned a verdict in favor of plaintiffs in the amount of $2000 for Taft and $3300 for Cutlip. Thereafter a motion for judgment notwithstanding the verdict was made by defendants. After due consideration, the motion was granted by the trial court. Plaintiffs now appeal from the granting of the motion for the judgment notwithstanding the verdict.
The law is well established that in order to sustain a charge of malicious prosecution the plaintiffs must show: (1) that a criminal prosecution was instituted against them which terminated in their favor, (2) that the defendants had no probable cause for the institution of the proceedings, and (3) that the defendants acted with malice. Hickey v Shellenbarger, 180 Mich 548 (1914); Drobczyk v Great Lakes Steel Corp, 367 Mich 318 (1962); Roblyer v Hoyt, 343 Mich 431 (1955); Belt v Ritter, 18 Mich App 495 (1969), aff’d 385 Mich 402 (1971).
The first item requires no discussion as there is no dispute concerning the fact that criminal proceedings were instituted and that they were settled in favor of the plaintiffs.
The third factor may be dispensed with due to the fact that malice can be inferred from the lack of probable cause. Drobczyk, supra; Stefanic v Montgomery Ward & Co, 358 Mich 460 (1960).
The learned trial judge in granting the aforesaid motion concluded that there were no issues of fact for the jury to decide and that as a matter of law the plaintiffs had failed to sustain their burden of showing want of probable cause. There are two aspects of this conclusion which will require consideration.
The trial court in its opinion said:
“When a defendant in a case of malicious prosecution has in good faith fully and fairly stated all of the material facts within his knowledge to the prosecuting attorney and signed a complaint on the latter’s advice, a case of probable cause is established barring plaintiff’s right to recover.”
There is no quarrel with this conclusion of law. However, the plaintiffs insist that the defendant failed to state “all of the material facts” and offered evidence to that effect. Consequently, it became a question of fact for the jury to decide.
The court in arriving at the above conclusion relied heavily upon Stefanic and Drobczyk. However, both of these cases can be distinguished. In Stefanic, supra, the prosecuting attorney delayed the issuance of the warrant until he had the opportunity to carry on an independent investigation by way of checking the records and the interviewing of witnesses. The same is true of Drobczyk, supra, where in the police department was asked to make a study and report.
The second aspect deals with the matter of intoxication. While the plaintiffs admitted having had three or four beers plus a couple of mixed drinks during the course of the evening, they insisted that they were not disorderly or intoxicated and had complete control of their senses. This was supported by the testimony of one of the deputy sheriffs. In his consideration of the motion, the trial judge, relying upon the definition of intoxication set forth in Lafler v Fisher, 121 Mich 60 (1899), held that the admission by plaintiffs with regard to the consumption of the beer and mixed drinks, when coupled with the altercation, meant that plaintiffs were intoxicated as a matter of law. To so hold was erroneous. Since during the trial both sides offered evidence as to whether the plaintiffs were intoxicated, it was properly a question of fact for consideration by the jury.
The law governing the question of want of probable cause in a malicious prosecution action is set forth in Obeginski v James, 4 Mich App 90, 92 (1966), wherein it was held:
“With reference to the first question, it is firmly established that if the facts are not in dispute, the existence or want of probable cause is a matter of law to be determined by the court. Rankin v. Crane, (1895), 104 Mich 6; Merriam v. Continental Motors Corp. (1954), 339 Mich 546; Renda v. International Union, UAW, (1962), 366 Mich 58; and Drobczyk v. Great Lakes Steel Corp. (1962), 367 Mich 318.
“It is equally well established that if the facts are in dispute, since probable cause is a mixed question of law and fact, it should be left to the determination of the jury under proper instruction. Fine v. Navarre (1895), 104 Mich 93; Slater v. Walter, (1907), 148 Mich 650; and Hall v. American Investment Co. (1928), 241 Mich 349.” See also Sottile v DeNike, 20 Mich App 468 (1969); LaLone v Rashid, 34 Mich App 193 (1971).
In Michigan a court reviewing a motion for a judgment notwithstanding the verdict must view all the evidence and testimony adduced at the trial in the light most favorable to the person against whom the motion was made. Savage v Peterson Distributing Co, Inc, 379 Mich 197 (1967); Prentkiewicz v Karp, 375 Mich 367 (1965); Kroll v Katz, 374 Mich 364 (1965); Wamser v N J Westra & Sons, Inc, 9 Mich App 89 (1967); Brusslan v Larsen, 6 Mich App 680 (1967); Johnson v Chesapeake & O R Co, 6 Mich App 611 (1967). If, when so viewed, there is any evidence which was competent and sufficient to support the jury’s determination, said determination should not be disturbed. See Wamser, supra; Killen v Benton, 1 Mich App 294 (1965).
Accordingly, we conclude, after a review of the record, that there was competent evidence, when viewed in the light most favorable to the plaintiffs, which was more than sufficient to warrant the finding that the defendants acted without probable cause. Therefore, the motion for a judgment notwithstanding the verdict should not have been granted.
Also raised in this appeal is the issue of whether or not the plaintiffs should be awarded treble damages pursuant to MCLA 600.2907; MSA 27A.2907. Unfortunately this rather aged statute has been interpreted upon only two occasions: Leeseberg v Builders Plumbing Supply Co, 6 Mich App 321 (1967) and LaLone v Rashid, 34 Mich App 193 (1971).
The Court in LaLone, supra, p 203, held:
“We construe the statute to mean that if a plaintiff elects to proceed thereunder he must make his election known to the court and to the defendant be fore the case is submitted to the jury. Then, and in that event, the court shall instruct the jury to find only the actual damages suffered by plaintiff and to return a verdict in that amount. * * # If such a verdict is returned in plaintiff’s favor, then upon application to the court, that amount must be trebled by the court since any verdict for plaintiff implicitly contains a finding of malice on the part of the defendant.”
While the plaintiffs herein failed to make their election to proceed under the statute known to the court and defendants prior to submission to the jury, we would hasten to add that the case at bar was tried in February 1970, well prior to the LaLone opinion which was released in June 1971. Since the Court in LaLone did not indicate that its holding should be retroactive, we hold that the failure to make known their election is not fatal to plaintiffs’ right to recover under the statute.
In the instant case the trial court submitted to the jury only the question of actual damages, and specifically cautioned the jury not to consider any exemplary or punitive damages. Since the jury was charged with only actual damages, the intent of the notice requirement in LaLone was effectuated. The trial court should therefore have trebled the verdict brought in by the jury, “since any verdict for plaintiff implicitly contains a finding of malice on the part of the defendant”.
The verdict of the jury is herewith reinstated and the cause is remanded for entry of judgment in accordance with this opinion. Costs to appellants.
All concurred. | [
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Per Curiam.
Defendant’s plea of guilty to the charge of uttering and publishing a forged instrument (MCLA § 750.249 [Stat Ann 1962 Rev § 28-.446]), was accepted in Macomb Circuit Court on October 2, 1969. The original sentencing proceeding was technically defective. At resentencing, on November 13,1970, defendant presented an oral motion to withdraw his guilty plea. The motion was denied and defendant was sentenced to serve a prison term of from 10 to 14 years. He presents this appeal as of right.
Of the numerous issues presented by defendant on appeal, we find merit in, and discuss, only one. At the time of the hearing of defendant’s motion to withdraw his guilty plea, defense counsel argued that defendant’s plea of guilty was originally obtained by undue pressure in that the prosecution agreed not to prosecute defendant’s wife for any involvement she may have had in the alleged incident. Defense counsel also stated that the transcript of the preliminary examination, which was not available to the court or counsel at the time that defendant’s motion to withdraw his plea was heard, would substantiate this allegation. The transcript of the preliminary examination reveals the following colloquy:
“Stanley Woodruff (assistant prosecuting attorney) : I might say, Mr. York, that we are aware that the wife may have been involved in these; but no one has requested that we seek any type of prosecution against her.
“Mr. York (defense counsel): Thank you Mr. Woodruff, that was something my client was concerned with. What he is saying, Mr. Smith, is that they don’t expect to prosecute your wife if in fact she is involved, and they’re not saying that she is. But whether or not she is, they are not going to prosecute her.
“Judge McLean: O. K. Fine.”
As the prosecution concedes in its brief “there is * * # a serious question as to whether or not the statement constitutes a promise not to prosecute as such”.
While it is true, as the prosecution contends, that a fulfilled plea bargain is not a ground for a withdrawal of a guilty plea, it does not follow that bargaining regarding the fate of a member of defendant’s family does not constitute coercion.
In view of the fact that the transcript of the preliminary examination was not available to the trial court at the time it ruled on defendant’s motion, and in view of the possible merit of defendant’s allegation, we feel the trial court should inquire into this allegation. We remand for such an inquiry.
See People v. Soliman (1968), 12 Mich App 231, appeal dismissed (1969), 381 Mich 791. | [
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Holbrook, J.
Defendant Hollis Jackson appeals from nonjury conviction of murder in the first degree, in violation of MCLA 750.316; MSA 28.548.
Jackson was jointly tried with defendants William Draughn and Melvin Dixion for the murder of John Buch, perpetrated during the course of an attempted robbery of the decedent.
The victim was shot and killed March 29, 1969, at 301 South Green Street in the City of Detroit, as he exited his bar after closing for the night. An autopsy performed on the decedent disclosed that he was shot three times, with the cause of death being a single gunshot wound in the chest.
The prosecution conceded that the only evidence available to prove guilt was the testimony of an accomplice participant, Danny Holmes, who was in jail waiting trial on another charge when he implicated himself and the other defendants in the Green Street incident. Holmes was not charged as a defendant in this murder.
At the trial Holmes testified that Jackson shot the decedent twice with Draughn firing other shots. Holmes testified that the total number of shots fired at decedent was seven or eight. Holmes further maintained that neither he nor Dixion had fired any shots. Codefendants Dixion and Draughn were found not guilty.
Defendant Jackson raises two issues on this appeal.
(1) Whether there was sufficient evidence upon which the trier of facts could determine Hollis Jackson guilty of the offense charged beyond a reasonable doubt?
Holmes’ testimony on direct examination concerning Jackson’s participation in the murder is set out herein.
“Q. Do you know the three defendants in this case, Hollis Jackson, Melvin Dixion, and William Draughn?
“A. Yes I do.
“Q. On March 29, 1969, how long had you known them?
“A. About two and a half months.
“Q. Beg your pardon?
“A. About two and a half months.
“Q. How did you get to know them?
“A. Through my brother.
“Q. Now, do you remember the night of March 29, 1969, on a Saturday night; do you remember the events of that night?
“A. Yes I do.
“Q. Were you anywhere near a bar located at 301 South Green Street, in the City of Detroit?
“A. Yes I was.
“Q. Around what time was it?
“A. About 11:45.
“Q. When you were there, were any other individuals there with you?
“A. Yes it was.
“Q. Who were with you?
“A. William Jerome, Melvin Dixion, and Hollis Jackson.
“Q. If you see them in the courtroom, will you point them out?
“A. Yes sir, right there (indicating).
“Mr. Weiswasser [assistant prosecuting attorney]: Let the record show the witness has identified the defendants William Draughn, Hollis Jackson, and Melvin Dixion.
“The Court: Which is—
“Q. (By Mr. Weiswasser): Which is which?
“A. William Jerome, Hollis Jackson, and Melvin Dixion.
“Q. What were you doing in the neighborhood at that bar at 11:45 that night?
“A. Planning on robbing it.
“Q. And, did you know that there was going to be a robbery — that a robbery was to take place at that .bar?
“A. Yes I did.
“Q. And, did you have a conversation with the three defendants about going to that place to rob the bar?
“A. Yes we did.
* # #
“Q. (By Mr. Weiswasser): Where did you have this conversation about robbing this bar ?
“A. In the car.
“Q. How long before the robbery took place ?
“A. About two hours.
“Q. And, who was in the car besides yourself?
“A. Melvin Dixion, Hollis Jackson, and William Draughn.
“Q. Who was driving?
“A. Dixion.
m‘Q. Do you know whose car it was?
“A. Melvin Dixion.
“Q. Well, did they — did you decide whether or not between all four of you whether or not you were going to rob the bar inside the bar or outside the bar?
“A. We decided to rob it outside.
“Q. Do you know why?
“A. Well, because of, well — really the front door was locked, and we decided on, well, doing it outside from the beginning, but we were just trying our luck for the inside.
“Q. All right. When you got to the bar, where did you put the car?
“A. It was parked in the alley on Green Place.
“Q. And, did all of you get out of the car?
“A. All three of us but Melvin Dixion.
# # #
“Q. Did he know there was going to be a holdup there?
“A. Yes he did.
“Q. All right, now did you see anybody come out of the bar around that time?
“A. Well, the man stuck his head out and looked up and down the street and locked the front door, and that’s when we ran around to the back.
“Q. And then what happened after you got around to the back?
“A. "Well, about twenty minutes later he came out and well, Hollis Jackson said this is a holdup, and he put his hands up in the sky. And they told me to search him, but I didn’t so William Jerome started sticking his hands in his pocket. About ten minutes later Jerome said look out; that’s when the shooting started.
“Q. You said Hollis Jackson said this was a stickup?
“A. Right.
“Q. What did William Draughn do?
“A. He started searching him.
“Q. And you say you were asked to search him and you wouldn’t do it?
“A. No.
“Q. Why?
“A. Well, because — I mean, really I didn’t want no part of it, but I had went so far, so I decided to go home.
“Q. Did you see Draughn put his hands in the man’s pockets?
“A. Yes I did.
“Q. Then what happened?
“A. Then all of a sudden he took his hands out of his pockets and said look out; that’s when the shooting started.
“Q. Who said look out?
“A. Jerome.
“Q. Did he say anything else besides look out?
“A. No he didn’t.
“Q. Who did the shooting?
“A. Hollis Jackson.
“Q. Did you see Hollis Jackson shoot the man?
“A. Yes I did.
“Q. How many times did he shoot him?
“A. Twice.
“Q. And, what did you do when you heard the shot?
“A. I started running towards the car.
“Q. What did Dranghn do?
“A. He started running towards the car and firing shots as he ran.” (The name William Jerome in the testimony is another name for defendant William Draughn.)
Although no bullet was recovered from the victim’s body, Sergeant Bobert Kanka testified that when he interviewed Holmes, Holmes stated the gun used by Jackson was a .38-caliber automatic pistol. Kanka further testified that spent cartridges from a .38-caliber automatic weapon were found at the scene of the murder.
We can readily see that through testimony of Holmes, evidence was presented permitting the trial judge to determine that Jackson shot the victim. Even though Holmes was an accomplice participant, and his testimony was the sole predicate for conviction of defendant, the Supreme Court of Michigan and our Court have held that a defendant can be convicted by the uncorroborated testimony of an accomplice. People v Zesk, 309 Mich 129 (1944) ; People v DeLano, 318 Mich 557 (1947); People v Billings, 19 Mich App 348 (1969); People v Burbridge, 23 Mich App 33 (1970).
All three defendants testified contrary to the testimony of Holmes, thus presenting a dispute as to the facts throughout the entire proceeding. We find it difficult to understand how the trial judge reached his decision of acquitting codefendants Dixion and Draughn, but finding defendant Jackson guilty, on the same evidence. However, credibility and the weight to be given the testimony is for the trier of the facts, and here apparently the trial judge believed the testimony of accomplice Holmes and rejected that of defendant Hollis Jackson. People v Doris White, 2 Mich App 104 (1965); People v Ritzema, 3 Mich App 637 (1966). We determine that there was sufficient evidence present which, if believed, justified the finding of defendant guilty beyond a reasonable doubt.
(2) Defendant now claims that it was error to stipulate to the reading of the preliminary examination by the trial judge. The reading was requested by defense counsel for defendant Draughn because of claimed inconsistencies in the testimony of witness Holmes at the preliminary examination and at the time of trial. Defendant’s attorney, when asked if he objected, answered no. There being no objection to this procedure, error, if any, has not been preserved.
Affirmed.
All concurred. | [
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] |
Quinn, J.
On the basis of a release, or releases, the trial court granted defendants Spilkers’ motion for an accelerated judgment, and plaintiff appeals. We reverse.
June 15, 1965, Pamela E. Schofield, a minor resident of Ohio, was a passenger in an automobile driven by her aunt, Vivian Fetterhoff, in Genesee County, Michigan. The auto collided with a trailer which had broken loose from an auto owned by Hattie Spilker and driven by John Spilker, causing injuries to the minor and her aunt.
December 22, 1965, Pamela’s mother, Evelyn M. Schofield, was appointed guardian by the Probate Court of Lorain County, Ohio, and December 23, 1965, on application of the guardian, that court approved a settlement of the minor’s claim against plaintiff’s insurer under an uninsured motorist provision in the amount of $10,000. June 30, 1966, plaintiff’s insurer paid the $10,000 and took a release and trust agreement from plaintiff.
April 24, 1967, Vivian Fetterhoff commenced an action against the Spilkers. Although Spilkers were uninsured and uncollectible, in order to obtain the return of their driver’s licenses which had been taken from them under the financial responsibility act, Spilkers agreed to a settlement of the Fetterhoff claim. On condition that Spilkers received a complete release from the Schofields as parents and guardian of Pamela for all claims arising out of the June 15, 1965 accident, Spilkers agreed to pay Fetterhoff $2,000 on a time basis. The required release and a covenant not to sue were obtained and a consent judgment was entered in favor of Mrs. Fetter hoff and against the Spilkers in the sum of $2,000, which has been substantially paid.
Although the only issue raised on appeal by plaintiff relates to the release obtained from Schofield as a condition to the settlement between Fetterhoff and Spilkers, the colloquy between the court and counsel at the January 16, 1970 hearing and the form of the order granting accelerated judgment indicate that the first release mentioned in this opinion is also involved.
With respect to the latter, the record establishes that the release executed by plaintiff as part of the settlement with her insurer for the claims arising from Pamela’s injuries had no relation to claims of Pamela against Spilkers. Regardless of the language of that release, it could not inure to the benefit of the Spilkers.
Plaintiff attacks the validity of the release executed as a condition to the settlement between Mrs. Fetterhoff and Spilkers on the basis of no consideration flowing from Spilkers to plaintiff. Consideration for a promise may inure to one other than the promisor, Highland Park v. Grant-Mackenzie Co. 366 Mich 430, 447 (1962). Here the benefit to Mrs. Fetterhoff, plaintiff’s sister, was consideration for the release.
Plaintiff’s second attack on the release last mentioned is based on the requirements of § 2111.18, Ohio Revised Code. That section requires that settlement and release of the claims of minors of the type here involved must be with the advice, approval, and consent of the probate court. The release from plaintiff to Spilkers as part of the Fetterhoff settlement was not with the advice, approval, and consent of the Ohio probate court and that release is no bar to the present action.
We decline comment on defendants’ issue relating to the statute of limitations. No defense based on that statute was pleaded as required by GCR 1963, 111.7.
Reversed and remanded for trial with costs to plaintiff.
All concurred. | [
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Corrigan, P.J.
Petitioner Institute in Basic Life Principles, Inc., appeals of right an order of the Tax Tribunal denying it an exemption from ad valorem property taxes as a house of public worship. We reverse.
i
UNDERLYING facts
Petitioner is a not-for-profit corporation that owns sixteen contiguous properties, totaling 1,800 acres, in respondent Watersmeet Township, Gogebic County. Four parcels are developed. Petitioner protested its Michigan property tax assessment for the years 1987 through 1990, arguing that it was exempt from taxes as a nonprofit, charitable, religious, and educational organization.
In 1961, petitioner’s founder, Reverend William Gothard, incorporated petitioner’s predecessor organization, which was designed to explain, primarily to young people, how the Bible can provide guidance. Petitioner accomplished this goal by conducting seminars on the Bible at Wheaton College in Illinois. In later years, petitioner expanded its work to include adults. When petitioner’s seminars outgrew their original quarters, petitioner rented auditoriums across the country. Petitioner now conducts seminars around the world.
Petitioner holds some seminars on its Watersmeet Township property. The property contains Eagle’s View Lodge, with fifteen rooms, and Northwoods Conference Center, which has ninety rooms, an auditorium for 350 people where worship services are held, a dining room for guests, and a gymnasium. Petitioner also uses the property to write religious materials for its seminars and for its home-schooling program, which petitioner established ten years ago. Six thousand Michigan families participate in the home-schooling program.
Petitioner is not a church and does not represent a religious denomination. Petitioner’s board members and lecturers represent various denominations, including Baptist, Reformed Presbyterian, and Lutheran. Those involved with petitioner believe that the literal truth of the Bible is the inspired word of God.
In 1991, the Tax Tribunal granted respondent township’s motion to dismiss. When petitioner appealed, this Court affirmed the tribunal’s decision on the claimed exemptions for educational and charitable organizations. Institute in Basic Life Principles, Inc, v Watersmeet Twp, unpublished opinion per curiam of the Court of Appeals, issued December 29, 1992 (Docket No. 140633). The panel remanded the case to the tribunal for further proceedings on whether petitioner qualified for an exemption as a house of public worship.
On remand, the Tax Tribunal ruled that petitioner’s property was not exempt because petitioner was not a religious society as defined in Hamsher v Hamsher, 132 Ill 273; 23 NE 1123 (1890), or in MCL 450.186; MSA 21.187. The tribunal reasoned that petitioner was not a religious society because it had no members and prescribed no form of worship. As an initial matter, we note that Hamsher is distinguishable from this case because it involved, not a tax exemption, but the right of an Illinois religious corporation to hold real property. Further, we reject the reasoning in Hamsher regarding the membership requirement, as will be explained.
n
THE DEFINITION OF A RELIGIOUS SOCIETY
In its present posture, this case presents an issue of first impression: whether the house of public worship tax exemption statute requires that a religious society have members. This Court’s usual review of the Tax Tribunal’s decisions is limited to deciding if the tribunal’s factual findings are supported by competent, material, and substantial evidence. In the absence of fraud, this Court reviews whether the Tax Tribunal made an error of law or adopted an incorrect legal principle. Gillette Co v Dep’t of Treasury, 198 Mich App 303, 306; 497 NW2d 595 (1993). Statutory interpretation, however, is a question of law subject to review de novo on appeal. DeKoning v Dep’t of Treasury, 211 Mich App 359, 361; 536 NW2d 231 (1995). Additionally, this Court generally defers to the longstanding construction of statutory provisions by a particular department of government. Bachman v Dep’t of Treasury, 215 Mich App 174, 182; 544 NW2d 733 (1996). Nonetheless, where the agency’s interpretation is clearly wrong, the longstanding interpretation of a statute by the agency that administers it does not control. Id.
When courts construe statutory meaning, their primary goal is to ascertain and give effect to legislative intent. Farrington v Total Petroleum, Inc, 442 Mich 201, 212; 501 NW2d 76 (1993); State Treasurer v Schuster, 215 Mich App 347; 547 NW2d 332 (1996). This Court should first look to the specific statutory language to determine the intent of the Legislature. House Speaker v State Administrative Bd, 441 Mich 547, 567; 495 NW2d 539 (1993). The Legislature is presumed to intend the meaning that the statute plainly expresses. Vargo v Sauer, 215 Mich App 389; 547 NW2d 40 (1996). Judicial construction of a statute is not permitted where the plain and ordinary meaning of the language is clear. Tryc v Michigan Veterans’ Facility, 451 Mich 129; 545 NW2d 642 (1996); Dep’t of Treasury v Comerica Bank, 201 Mich App 318, 322; 506 NW2d 283 (1993).
Courts should strictly construe exemption provisions in favor of the taxing unit because an exemption removes the burden on the exempt landowner to share in the support of local government; in essence, “exemption is the antithesis of tax equality.” Michigan Baptist Homes & Development Co v Ann Arbor, 396 Mich 660, 670; 242 NW2d 749 (1976); Chauncey & Marion Derring McCormick Foundation v Wawatam Twp (After Remand), 196 Mich App 179, 182; 492 NW2d 751 (1992). A strict construction, however, does not require a strained construction, contrary to the legislative intent. St Paul Lutheran Church v Riverview, 165 Mich App 155, 158; 418 NW2d 412 (1987).
Petitioner argues on appeal that the tribunal erred in interpreting the exemption for a house of public worship to require that a religious society have a formal membership roster and that it supervise or discipline its members. We agree.
The statute provides:
Houses of public worship, with the land on which they stand, the furniture therein and all rights in the pews, and any parsonage owned by a religious society of this state and occupied as a parsonage are exempt from taxation under this act. Houses of public worship includes [sic] buildings or other facilities owned by a religious society and used predominantly for religious services or for teaching the religious truths and beliefs of the society. [MCL 211.7s; MSA 7.7(4p).][ ]
Under the language of this statute, petitioner’s property is exempt from taxation provided that petitioner is a religious society and provided that the property is used predominantly for religious services or for teaching the religious truths and beliefs of the society.
The statute does not define the term “religious society,” although the usage of the term in the second quoted sentence suggests that the key test is whether an organization or association engages in teaching religious truths and beliefs. This same inference can be drawn from the general corporation act, which also uses the term:
Any 3 or more persons may incorporate a Sunday school society, or other special religious society or union, not being a church, but having for its object the teaching of religious principles, or the associating together for religious work. The incorporators shall subscribe articles similar to those prescribed for non-profit corporations generally, which articles shall also contain any special conditions or distinguishing principles upon which such corporation is founded, and, if connected with some organized church, the name of the church and a statement of the extent to which such church may exercise superintendence over the affairs of or discipline of the members of such Sunday school or other corporation. The corporations referred to in this section as Sunday schools or special religious societies, shall have all the rights, privileges, immunities and powers granted by this act to non-profit corporations generally in their secular affairs; and in their religious affairs they shall be governed solely by their articles and by-laws, and the system of discipline therein adopted. [MCL 450.186; MSA 21.187.]
We conclude from these statutory provisions that an association or organization qualifies as a “religious society” for purposes of the house of public worship tax exemption if its predominant purpose and practice include teaching religious truths and beliefs.
Petitioner has for its object the teaching of religious principles. Petitioner was incorporated in Michigan in 1974, and its corporate bylaws set forth its purposes as follows:
The purposes of this Corporation as stated in its Certificate of Incorporation are to introduce youth and parents to God’s basic way of life through the Gospel of the Lord Jesus Christ; to give clear instruction on how to apply God’s basic principles of life as revealed in the Scriptures, to develop meetings, seminars, radio broadcasts, television productions, printed literature, teaching curriculum, books, and other forms of media, producing or otherwise obtaining same as required; and to establish, organize and operate facilities for the training of personnel to accomplish the above and for the enrichment of youth, their families, their churches, their schools and their communities[ ]
Petitioner conducts seminars throughout the country about how the Bible can provide answers to typical problems. For example, petitioner held a seminar at Cobo Arena that was attended by over ten thousand people. Petitioner developed a home-schooling program that bases education on biblical principles to further spread Christianity. Petitioner has conducted special seminars for doctors, legislators, lawyers, pas tors, and judges. Because petitioner’s purpose is to teach religious principles, petitioner falls within the above definition of a religious society.
With respect to the tribunal’s reasoning, nothing within MCL 211.7s; MSA 7.7(4p) requires that a religious society have members. This narrow interpretation of the statute, in reliance on out-of-state authority, precludes exemptions for property owned by ecumenical religious societies, such as petitioner, even though the property is used for teaching religious beliefs and truths. The Tax Tribunal’s definition further excludes from exemption religious entities with only loose affiliations with organized religions. Although petitioner may not fall within the traditional definition of a religious society, that does not mean that it is not entitled to an exemption as a religious society under the house of public worship exemption.
Further, the Tax Tribunal erred in declining to award petitioner tax-exempt status in part because petitioner did not exercise superintendence over the discipline of its members. The general corporation act section quoted above requires such superintendence only “if” a religious society is connected with some organized church. Although Reverend William Gothard, petitioner’s founder, was ordained as a minister of the LaGrange (Illinois) Bible Church in 1961, petitioner is not connected with the LaGrange Bible Church. The statute thus cannot be read to imply that petitioner must exercise superintendence over the discipline of its members to be considered a religious society.
Additional statutory law supports this result. Under the Nonprofit Corporation Act, MCL 450.2101 el seq.; MSA 21.197(101) et seq., a nonprofit corporation need not have members. The pertinent statute provides that “[a] corporation organized upon a directorship basis may or may not have members.” MCL 450.2305(1); MSA 21.197(305)(1). Because petitioner is organized as a nonprofit corporation as called for under the general corporation act, the above statute does not require petitioner to have members.
Apart from the “quantum of use” issues we will address, there is no dispute that the statutory requirement regarding the property being used for a religious purpose is satisfied under the facts of this case. The record reflects that petitioner is a well-established, legitimate religious entity. It has used the Gogebic County property to further its religious purposes for over two decades. Its seminars have been attended by more than 2.5 million people over the years. In short, petitioner is not an ephemeral organization lacking a sincere purpose for which we open wide the tax-exemption door.
Next, petitioner claims that the tribunal’s definition of “religious society” violates the federal and state constitutions. Given our resolution of the first issue, we need not discuss this issue.
m
THE QUANTUM OF USE TEST
Petitioner also argues that the Tax Tribunal erred in applying the quantum of use test. This Court first addressed the quantum of use test in Lake Louise Christian Community v Hudson Twp, 10 Mich App 573; 159 NW2d 849 (1968). The Court examined the use of land owned by the plaintiff, a religious and educational nonprofit corporation. The Court was concerned with the frequency and quantum of the use of the plaintiffs wooded parcels for its stated purposes. The Court relied on the following criteria: (1) that the use was incidental or relative to the corporation’s express purpose, and (2) that the property was used frequently for that purpose. Id. at 580.
This Court next considered, and rejected, the quantum of use test in Nat'l Music Camp v Green Lake Twp, 76 Mich App 608; 257 NW2d 188 (1977). The Court expressly held that the quantum of use test did not apply to educational organizations within the scope of the statute. Id. at 611, n 1. The Court found that the quantum of use test was “stringent,” “rigorous,” and “extreme.” Id. at 611. The Court instead concluded that the property was used “in a manner consistent with the nature of the land in such a way that the purpose for which the owning institution is exempt, education, was plainly advanced.” Id. at 612.
The Court in Kalamazoo Nature Center, Inc v Cooper Twp, 104 Mich App 657; 305 NW2d 283 (1981), also examined the property owner’s use of the property in an educational setting. The Court determined that the owner used the property in accordance with its stated purposes. Thé Court ultimately decided that physical use of the property was not a condition precedent to tax exemption and that the statute did not require actual physical use. Id. at 666. The Court added that the owner’s use of the property was not occasional or de minimus. Given those circumstances, the Court stated that the quantum of use test was not a bar to the tax-exempt status of the property. Id. at 667.
More recently, in McCormick Foundation, supra, the Court again declined to apply the quantum of use test, following Nat'l Music Camp, supra. The Court decided that the entire property was used in a manner that was consistent with the property owner’s charitable purposes. McCormick Foundation, supra at 187-189.
Although the cases rejecting the quantum of use test involve educational institutions rather than houses of public worship, their reasoning applies here. We decline to invite the Tax Tribunal to apply the rigorous quantum of use test, finding that the test would unnecessarily intrude into the affairs of religious organizations. Rather, we adopt the criteria employed in Nat'l Music Camp and McCormick Foundation and ask whether the entire property was used in a manner consistent with the purposes of the owning institution. This test avoids undue entanglement in the province of religious entities, and more closely conforms with the requirement under the exemption statute that the property be used predominantly for teaching the religious truths of the society.
In this case, petitioner’s stated purpose was the enrichment of youth and their families through Bible study. Petitioner has conducted several religious seminars on the property. Petitioner has provided its seminar attendees access to the lakes on the property and has paved seven miles of road for bicycling. The large areas of undeveloped land permit the participants to walk through woods and think about what they have heard. Also, petitioner has composed religious pamphlets on the property. The record contains no evidence that the property was being used for purposes outside those enumerated in petitioner’s bylaws. Because petitioner and its guests use the property in a manner consistent with petitioner’s stated purposes, the property should be exempt from taxes.
Reversed.
Petitioner is exempt from federal taxes as a charitable, religious organization. Property in Illinois that petitioner uses for educational purposes is also tax exempt.
Gothard was on petitioner’s board and served as its president when this litigation was pending in the Tax Tribunal.
Petitioner then applied for leave to appeal to our Supreme Court, which denied leave, 442 Mich 930 (1993).
Petitioner later requested exemptions for the tax years 1991 through 1993. The tribunal granted petitioner’s motion to consolidate the cases. The tribunal dismissed petitioner’s claims for exemptions based on its charitable and educational status.
The parties do not dispute that the property in question is not a parsonage. See St John’s Evangelical Lutheran Church v Bay City, 114 Mich App 616, 624-625; 319 NW2d 378 (1982).
As noted earlier, the houses of public worship definition includes two requirements, that property be owned by a religious society and that it be used for religious purposes including the teaching of religious truths and beliefs. Our definition of “religious society” does not reduce that twofold requirement down to a single criterion because there may well be cases where facilities used by a religious society for teaching religious truths and beliefs are nonetheless not houses of public worship because the society does not own those facilities. Conversely, a facility owned by a religious society does not qualify for the houses of public worship exemption unless that facility is used for teaching religious truths and beliefs.
Additional petitioner bylaws provide that its purposes include:
To assist families, churches, governments, and businesses in establishing the ethical, moral principles of the Bible upon which America and its law system were founded;
To provide specialized training in education, counseling, business, law and health in order to equip individuals to make wise decisions to benefit their lives and the lives of others;
To establish schools, training centers, and other facilities necessary to carry out these purposes along with the production of books and materials related to the training being given.
Gothard continues to receive a salary from the LaGrange Bible Church as a supported missionary. | [
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Taylor, P. J.
Following a jury trial, plaintiff was awarded $35,992.85 for injuries sustained in a car accident. Defendant was subsequently awarded $8,000 in attorney fees as offer-of-judgment sanctions. Plaintiff appeals as of right the trial court’s denial of her motion for a new trial or additur and the appropriateness of the award of offer-of-judgment sanctions. Defendant cross appeals the amount of attorney fees awarded as offer-of-judgment sanctions. We reverse and remand for a new trial.
Plaintiff testified that she was traveling north on Inkster Road in Dearborn Heights and that the traffic light was green just before she entered the intersection with Ann Arbor Trail. She stated that defendant was stopped in the left-turn lane of southbound Inkster Road and, as she was entering the intersection, he pulled directly into her path in an attempt to make a left turn. A passenger in plaintiff’s vehicle testified that defendant turned in front of plaintiff without warning and that the light was green. The vehicles collided, and plaintiff was taken to the hospital with an injured right foot.
Defendant died after commencement of this lawsuit, but not before his deposition was taken. At trial, this deposition was read to the jury. He stated that he was indeed traveling south on Inkster Road and that the light was green when he was one hundred to two hundred feet from the intersection. As he approached, he pulled into the left-turn lane, signaled, stopped, and waited for traffic to clear. The light was yellow just before he started his turn, and he turned believing he had the right of way. As he proceeded through the intersection, there was a collision as the left front of his vehicle made contact with the front portion of plaintiffs vehicle. The jury found that defendant’s negligence had been a proximate cause of the accident and that plaintiff had suffered a serious impairment of body function, but that plaintiff had been fifty percent comparatively negligent.
Plaintiff argues that defense counsel engaged in several improper arguments. We reverse on the basis of two improper arguments made by defense counsel.
When reviewing asserted improper comments by an attorney, we first determine whether the attorney’s action was error and, if it was, whether the error requires reversal. Wilson v General Motors Corp, 183 Mich App 21, 26; 454 NW2d 405 (1990). An attorney’s comments usually will not be cause for reversal unless they indicate a deliberate course of conduct aimed at preventing a fair and impartial trial. Id. Reversal is required only where the prejudicial statements of an attorney reflect a studied purpose to inflame or prejudice a jury or deflect the jury’s attention from the issues involved. Hammack v Lutheran Social Services, 211 Mich App 1, 9; 535 NW2d 215 (1995).
Plaintiff testified that her foot was stiff as a result of the accident. During closing argument, defense counsel argued that this may have been a result of plaintiff’s using a wrap for her foot in accordance with her podiatrist’s advice, which had been contrary to the advice of two orthopedic surgeons. Although plaintiff’s counsel did not object to this argument, we find that it was error requiring reversal. Defense counsel’s argument invited the jury to reduce plaintiff’s damages because her injury may have been exacerbated by following the advice of her podiatrist as opposed to the advice of the two orthopedic surgeons. This was improper argument that may have denied plaintiff a fair trial. A patient may follow a licensed medical care provider’s advice without risking a reduced award of damages for following such advice. McAuliff v Gabriel, 34 Mich App 344, 348-349; 191 NW2d 128 (1971). This improper argument may well have influenced the jury’s determination that plaintiff had been fifty percent comparatively negligent and may have caused the jury to award only $1,000 a year for future pain and suffering. Plaintiff is not required to establish affirmative prejudice as a consequence of this improper argument. Reetz v Kinsman Marine Transit Co, 416 Mich 97, 103, n 8, 107, n 20; 330 NW2d 638 (1982).
Plaintiff further contends that defense counsel should not have been allowed to argue that she could have avoided “drinking and then driving” after plaintiff had acknowledged drinking part of a wine cooler before driving. Defense counsel told the jury that it was for it to decide whether it believed plaintiff’s drinking part of a wine cooler affected her ability to perceive and react. The court overruled plaintiff’s objection to this argument. There was no testimony showing that consuming part of a wine cooler could affect a person’s ability to perceive and react. Therefore, this argument was not supported by evidence. Without appropriate foundation testimony, such argu ment was improper and injected a false issue into the case.
Plaintiff also argues that the court committed error requiring reversal in allowing defense counsel, during her opening statement, to refer to two of her four medical witnesses as “litigation doctors” who were “paid a large amount of money,” used “extremely colorful language” in the form of “memorized speeches,” and give “pat answer[s].”
Defense counsel gave her opening statement after having deposed Dr. Sidney Goldman and Dr. Steven Newman, and it was known that these two doctors were going to be testifying at trial by video deposition. Dr. Newman had testified that he gave an average of three depositions a week. He said he had been paid $630 to prepare for and give a two-hour deposition, and that he charged $200 an hour after the first two hours. Dr. Goldman had stated that he doubted he had given ten depositions that month, and that he charged about $700 for the hour his deposition would take because he had to clear his office to let the video camera operator set up and tear down. What constitutes a fair and proper opening statement is left to the discretion of the trial court. Wilson, supra at 27. We find that the trial court did not abuse its discretion in allowing defense counsel to argue as she did. There was no impropriety in defense counsel’s pointing out that Drs. Goldman and Newman spend a significant portion of their time evaluating injured persons for attorneys and in giving testimony in lawsuits for which they are well compensated. There was record support for these characterizations. People v Chatfield, 170 Mich App 831, 834; 428 NW2d 788 (1988). While there is nothing improper about doctors choosing to spend a large amount of time reviewing cases and testifying on behalf of injured persons, this does not mean that a reasonable person, made aware of how often such doctors give depositions, and the noteworthy fees such services command, might not, without pejorative intent, describe such practitioners as “litigation doctors” who “were paid a large amount of money.” Cf. Heins v Detroit Osteopathic Hosp, 150 Mich App 641, 644-645; 389 NW2d 141 (1986), where this Court stated that it was not inappropriate to refer to a doctor as a “professional witness” where the proofs showed the doctor’s practice was limited to evaluations. With regard to the descriptions of their testimony as “extremely colorful,” “memorized,” and “pat answers,” we conclude that such argument is well within the ambit of suitable comment that a jury may evaluate itself. Reetz, supra at 109.
Plaintiff also argues that the court committed error requiring reversal in denying her motion for a directed verdict and allowing defendant to argue, and the jury to consider, that she had been comparatively negligent where there was no basis in the record to support any claim that her own negligence was a proximate cause of her injuries.
In deciding if the trial court erred in denying a motion for a directed verdict, we review the evidence and all legitimate inferences that may be drawn in a light most favorable to the nonmoving party. Zander v Ogihara Corp, 213 Mich App 438, 441; 540 NW2d 702 (1995). If reasonable jurors could honestly have reached different conclusions, neither the trial court nor this Court may substitute its judgment for that of the jury. Id. Furthermore, directed verdicts are viewed with disfavor in negligence cases. Berryman v K Mart Corp, 193 Mich App 88, 91; 483 NW2d 642 (1992).
Plaintiff contends that defense counsel should not have been allowed to argue that she was comparatively negligent for driving at an excessive speed and that the court erred in instructing the jury that it could infer negligence if it found plaintiff had been traveling at an unreasonable speed. The posted speed limit was forty m.p.h. Defense counsel noted that, in her deposition, plaintiff said she had been going forty-five m.p.h. at one point and then argued “if you believe she was going 45, that is certainly evidence of negligence on her part.” Plaintiffs counsel did not object to this argument and also did not object to the court’s instruction. We find no error. The proofs were sufficient to allow defense counsel to argue that plaintiff may have been comparatively negligent as a result of exceeding the posted speed limit. McGuire v Rabaut, 354 Mich 230, 235; 92 NW2d 299 (1958). Defendant had the right to ask the jury to believe his case, however improbable it may have seemed. Caldwell v Fox, 394 Mich 401, 407; 231 NW2d 46 (1975). Furthermore, violation of a statute may lead to an inference of negligence. SJI2d 12.01. We also note that the court instructed the jury that it was to disregard anything said by an attorney that was not supported by evidence and that it had the right to consider all the evidence in light of its own general knowledge and experience in the affairs of life. Finally, MCR 2.516(C) clearly states that to assign error to the giving of a jury instruction a party must object on the record, and plaintiff did not do so here.
Plaintiff next argues that the court erred in not allowing her to present evidence regarding an economic loss she sustained because of having to sell a bar as a result of the accident. The court denied plaintiff’s request to reopen her direct examination to present this economic-loss evidence because plaintiff failed to mention the sale of the bar in her complaint, in answering interrogatories, or in the final pretrial order. The court concluded that it would be unfair to reopen her proofs because defendant did not have notice of this claim. We find no abuse of discretion. Dacon v Transue, 441 Mich 315, 328-329; 490 NW2d 369 (1992); Davey v Ikle, 348 Mich 64, 68; 81 NW2d 233 (1957). The court is free to reconsider this matter at retrial with proper opportunity, of course, for discovery regarding this matter to be afforded defendant.
Given our resolution of earlier issues, we need not decide if the jury’s verdict was grossly inadequate to compensate plaintiff for her injuries or if the court erred in denying her motion for additur. Similarly, we need not decide if offer-of-judgment sanctions were appropriate. (Indeed, this issue may never need to be resolved if the parties exchange new offers of judgment after release of this opinion). Finally, defendant’s cross appeal regarding the reduction of attorney fees is also moot.
Reversed and remanded for a new trial. We do not retain jurisdiction.
This situation should not be confused with a drank driving case where a scientifically reliable test has quantified a driver’s blood alcohol content at a level at which the Legislature has created a presumption that the driver is impaired or which constitutes a violation of the criminal law per se. MCL 257.625(1), (2); MSA 9.2325(1), (2). Nor is this to say nec essarily that a court could not exercise its discretion to allow such an argument where the amount of alcohol consumed was a much larger amount, providing a proper basis for taking judicial notice that such a quantity of alcohol and time for absorption into the bloodstream would impair a driver. MCR 201(b)(2). | [
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Per Curiam.
Defendant appeals by leave granted the circuit court affirmance of his district court conviction of operating a vehicle while under the influence of liquor, second offense, MCL 257.625(5); MSA 9.2325(5). We affirm.
The only issue to be determined on appeal is whether the trial court erred in permitting the arresting police officer to testify regarding his administration of the horizontal gaze nystagmus (hgn) test. The HGN test is one of several field sobriety tests recommended by the National Highway Traffic Safety Administration to aid officers in determining whether a driver is intoxicated. City of Fargo v McLauglin, 512 NW2d 700 (ND, 1994). As noted by the Supreme Court of Arizona in State v Superior Court, 149 Ariz 269, 275; 718 P2d 171 (1986):
Nystagmus is a well known physiological phenomenon, defined and described in such tomes as Webster’s new collegiate dictionary (1980), dorland’s illustrated medical dictionary (25th ed 1974), 7 encyclopaedia britannica, micropaedia (15th ed 1974) and stedman’s medical dictionary (5th Lawyer’s ed 1982). That it can be caused by ingestion of alcohol is also accepted in medical literature. “Jerk nystagmus ... is characterized by a slow drift, usually away from the direction of gaze, followed by a quick jerk of recovery in the direction of gaze. A motor disorder, it may be congenital or due to a variety of conditions affecting the brain, including ingestion of drugs such as alcohol and barbiturates, palsy of lateral or vertical gaze, disorders of the vestibular apparatus and brainstem and cerebellar dysfunction.” THE MERCK MANUAL OF DIAGNOSIS AND THERAPY 1980 (14th ed 1982).
Horizontal gaze nystagmus is the inability of the eyes to maintain visual fixation as they move from left to right. Superior Court, supra. The HGN test has been in use for over forty years. The test was first used in California to detect the “barb bounce” in barbiturate users and later incorporated by police in drunken driving cases. Anno: Horizontal gaze nystagmus test: Use in impaired driving prosecution, 60 ALR4th 1130, 1131. In the HGN test, the subject holds the head still and covers or closes one eye while focusing the other on an object (e.g., a pen) held at eye level. As the object is gradually moved out of the subject’s field of vision toward the ear, the officer is to look for involuntary jerking of the eyeball while it tracks the object. The test is repeated with the other eye. The onset of nystagmus is the indicator for alcohol intoxication. See, e.g., Superior Court, supra at 271.
Although the admissibility of HGN testing is an issue of first impression in this state, the issue has been addressed in several other jurisdictions with varying results.
Some courts have concluded that HGN testing is scientific evidence that unlike other field sobriety tests, is not grounded in common knowledge regarding the effects of alcohol on motor coordination, and is inad missible in the absence of evidence that the test has gained general acceptance in the relevant scientific community and that it is reliable. People v Leahy, 8 Cal 4th 587; 34 Cal Rptr 2d 663; 882 P2d 321 (1994); State v Witte, 251 Kan 313; 836 P2d 1110 (1992); Sides v State, 574 So 2d 859 (Ala, 1990); State v Barker, 179 W Va 194; 366 SE2d 642 (1988); State v Borchardt, 224 Neb 47; 395 NW2d 551 (1986); State v Cissne, 72 Wash App 677; 865 P2d 564 (1994); Commonwealth v Moore, 430 Pa Super 575; 635 A2d 625 (1993); Commonwealth v Apollo, 412 Pa Super 453; 603 A2d 1023 (1992); State v Wheeler, 764 SW2d 523 (Mo App, 1989); Commonwealth v Miller, 367 Pa Super 359; 532 A2d 1186 (1987); State v Reed, 83 Or App 451; 732 P2d 66 (1987); People v Vega, 145 Ill App 3d 996; 99 Ill Dec 808; 496 NE2d 501 (1986).
While acknowledging hgn tests are scientific evidence, several other courts have held that general acceptance and reliability of the test have been shown and, thus, require for admission only the foundation that the test was properly administered by a qualified person. E.g., State v Garrett, 119 Idaho 878; 811 P2d 488 (1991); State ex rel Hamilton v City Court of Mesa, 165 Ariz 514; 799 P2d 855 (1990); State v Clark, 234 Mont 222; 762 P2d 853 (1988); Superior Court, supra; Anderson v State, 866 SW2d 685 (Tex App, 1993); People v Buening, 229 Ill App 3d 538; 170 Ill Dec 542; 592 NE2d 1222 (1992); State v Armstrong, 561 So 2d 883 (La App, 1990).
Still other courts have characterized the HGN test, when used only to determine the presence of alcohol rather than the quantity of the amount present, not as “scientific evidence” but as merely another form of field sobriety testing. City of Fargo, supra; Whitson v State, 314 Ark 458; 863 SW2d 794 (1993); State v Sullivan, 310 SC 311; 426 SE2d 766 (1993); State v Edman, 452 NW2d 169 (Iowa, 1990); State v Murphy, 451 NW2d 154 (Iowa, 1990); State v Bresson, 51 Ohio St 3d 123; 554 NE2d 1330 (1990); State v Nagel, 30 Ohio App 3d 80; 506 NE2d 285 (1986).
We agree with those cases that acknowledge the hgn test is scientific evidence and recognize the general acceptance and reliability of the test has been proved. As the Supreme Court of North Dakota noted in McLaughlin, supra at 704:
The Arizona Supreme Court’s decision in State v Superior Court is the seminal case on admissibility of hgn test results. In that case, the lower court had received voluminous testimony on the scientific basis and reliability of the test. The Arizona Supreme Court also consulted numerous treatises, articles, and empirical studies discussing the scientific basis for the test, and compiled a lengthy bibliography of those sources. See State v Superior Court, 718 P2d at 182-184. Based upon the expert testimony and written authorities, the court concluded that the hgn test had gained general acceptance in the scientific community, and that it therefore satisfied the requirements of Frye v United States, 54 US App DC 46; 293 F 1013 (1923).
Because we agree the hgn test, when used to establish the presence of alcohol, has gained general acceptance in the scientific community and has satisfied the requirements of the Davis-Frye rule, the prosecution was not required to present expert testimony concerning the validity of the test and the trial court did not err in failing to conduct a Davis-Frye hearing. We conclude the only foundation necessary for the introduction of evidence regarding the hgn test in Michigan is evidence that the test was properly performed and that the officer adnünistering the test was qualified to perform it.
We find no abuse of discretion in the lower court’s admission of the evidence. The officer testified about his training and no question was raised regarding the administration of the test.
Affirmed.
We note this case does not involve the use of the hgn test to quantify the amount of alcohol present, but merely to determine its presence. We express no opinion regarding the use of the hgn test for such a purpose. The courts that have addressed the introduction of hgn testing evidence have been very careful to distinguish between the two types of information that can be obtained by use of the test. We are unaware of any court to date that has permitted the admission, as substantive evidence, of hgn test results to quantify blood alcohol level (bac) in the absence of chemical analysis of BAC.
Scientific acceptability of certain evidence may be judicially noticed in Michigan. See People v Haywood, 209 Mich App 217; 536 NW2d 497 (1995).
People v Davis, 343 Mich 348; 72 NW2d 269 (1955); Frye, supra. | [
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Jansen, P.J.
In these consolidated appeals, defendant appeals as of right in Docket No. 172651 from a December 17, 1993, order of the Wayne Circuit Court confirming an arbitration award in the amount of $240,000 in plaintiff’s favor and in Docket No. 176203 from a May 17, 1994, amended judgment granting plaintiff costs in the amount of $12,803.05. We affirm in No. 172651 and reverse in No. 176203.
Plaintiff’s decedent, Aaron Dohanyos, a nineteen-year-old laborer, died on July 2, 1990, at a Phoenix Metals, Inc., manufacturing plant while repairing a conveyor made by Livonia Magnetics, Inc., and owned by Phoenix Metals, Inc. In repairing the machine, plaintiff’s decedent used a degreasing solvent. Plaintiff’s decedent was overcome by fumes from the solvent and died of acute trichloroethane inhalation poisoning. The solvent (Perm-Ethane) was manufactured by defendant.
On August 14, 1991, plaintiff, the decedent’s father, filed suit in the Wayne Circuit Court against defendant (and others not relevant to this appeal) claiming damages for wrongful death under a theory of negligent failure to warn of the dangers of the solvent. Thereafter, the parties agreed to resolve their dispute through binding arbitration, and an arbitration agreement was executed. Plaintiff’s suit in the circuit court was accordingly dismissed and the case proceeded to arbitration. A three-member panel consisting of attorneys issued their award of $240,000 in plaintiffs favor on November 19, 1993.
On December 14, 1993, defendant filed a motion to vacate the arbitration award. On December 17, 1993, the circuit court denied defendant’s motion and entered judgment in plaintiff’s favor in the amount of the arbitration award. Defendant then filed a motion for reconsideration, which was also denied. Defendant appealed as of right. This Court remanded the matter to allow plaintiff to move for amendment of the judgment. An amended order of judgment was entered on May 17, 1994, which awarded plaintiff taxable costs under MCR 3.602(M).
On appeal, defendant argues that the circuit court abused its discretion in denying defendant’s motion for rehearing because a recently published decision of this Court rendered the arbitration decision legally incorrect. Defendant also contends that the arbitration award should have been vacated because the arbitrators exceeded their authority by failing to find that defendant’s warnings were adequate as a matter of law. Finally, defendant argues that the circuit court erred in amending the judgment to include taxable costs. Plaintiff, on the other hand, argues that because defendant agreed to final and binding arbitration, it cannot now challenge the arbitrators’ decision.
DOCKET NO. 172651
This case concerns the scope of judicial review of an arbitration award. The arbitration agreement in this case specifically states:
All decisions of the arbitration panel shall be final and binding on the parties when a majority of the arbitrators agree and the arbitration award, if any, shall be deemed to include all interest, costs, attorney fees and sanctions, and shall be enforceable under [MCL 600.5001 et seq.; MSA 27A.5001 et seq.].
Therefore, by the terms of the arbitration agreement, the arbitration in this case falls within the definition of statutory arbitration and is governed by MCL 600.5001 et seq.; MSA 27A.5001 et seq. Gordon Sel-Way, Inc v Spence Bros, Inc, 438 Mich 488, 495; 475 NW2d 704 (1991).
Statutory arbitration is to be conducted in accordance with the rules of the Michigan Supreme Court. MCL 600.5021; MSA 27A.5021. An arbitration award may be confirmed, modified, corrected, or vacated. The court’s power to modify, correct, or vacate an arbitration award is limited by court rule. An arbitration award may be vacated if (1) the award was procured by corruption, fraud, or other undue means; (2) there was evident partiality by an arbitrator, corruption by an arbitrator, or misconduct prejudicing a party’s rights; (3) the arbitrator exceeded granted powers; or (4) the arbitrator refused to postpone the hearing on a showing of sufficient cause, refused to hear evidence material to the controversy, or otherwise conducted the hearing to prejudice substantially a party’s rights. MCR 3.602(J)(1).
An arbitration award may also be modified or corrected, but, like vacation of the award, only in a limited manner. An arbitration award may be modified or corrected if (1) there is evident miscalculation of figures or an evident mistake in the description of a person, a thing, or property referred to in the award; (2) the arbitrator has made an award with regard to a matter not submitted for arbitration and the award may be corrected without affecting the merits of the decision regarding the issues submitted; or (3) the award is imperfect in a matter of form, but the imperfection does not affect the merits of the controversy. MCR 3.602(K)(1).
Defendant contends that the circuit court erred in not vacating the arbitration award because the arbitrators exceeded their powers. MCR 3.602(J)(l)(c). The appropriate standard of review for determining whether arbitrators have exceeded the scope of their authority was set forth in DAIIE v Gavin, 416 Mich 407; 331 NW2d 418 (1982), and more recently in Gordon Sel-Way, supra. In Gavin, supra, pp 428-429, the Supreme Court stated that a reviewing court’s ability to review an award is restricted to cases in which an error of law appears from the face of the award, or the terms of the contract of submission, or such documentation as the parties agree will consti tute the record. Therefore, arbitrators have exceeded their powers whenever they act beyond the material terms of the contract from which they primarily draw their authority, or in contravention of controlling principles of law. Id., p 434; Gordon Sel-Way, swpra, p 496. This is because arbitrators derive their authority from the parties’ contract and arbitration agreement and they are bound to act within those terms. Id.
Where it clearly appears on the face of the award or in the reasons for the decision, being substantially a part of the award, that the arbitrators through an error of law have been led to a wrong conclusion and that, but for such error, a substantially different award must have been made, the award and decision will be set aside. Gavin, supra, p 443. The character or seriousness of an error of law that will require a court of law to vacate an arbitration award must be so material or so substantial as to have governed the award, and the error must be one but for which the award would have been substantially otherwise. Id.
Plaintiffs claim against defendant is a product liability claim premised on a failure to warn theory. The arbitration agreement specifically states:
The arbitrators are empowered to hear and determine the issues of tort liability and allowable damages under the Michigan Wrongful Death Statute, and the arbitration shall proceed in conformance with the Michigan Rules of Evidence, unless expressly modified by the parties.
We must examine whether the arbitrators have rendered an award that comports with the terms of the arbitration agreement, because arbitrators exceed their powers whenever they act beyond the material terms of the contract from which they draw their authority. Gordon Sel-Way, supra, p 496. Our Supreme Court has cautioned that
an allegation that the arbitrators have exceeded their powers must be carefully evaluated in order to assure that this claim is not used as a ruse to induce the court to review the merits of the arbitrators’ decision. Stated otherwise, courts may not substitute their judgment for that of the arbitrators and hence are reluctant to vacate or modify an award when the arbitration agreement does not expressly limit the arbitrators’ power in some way. [Id., p 497.]
Therefore, a general principle of arbitration precludes courts from upsetting an award for reasons that concern the merits of the claim. Id., p 500.
We conclude that the circuit court did not err in denying defendant’s motion to vacate the arbitration award. The arbitrators did not act beyond the material terms of the arbitration agreement, because the arbitration agreement specifically empowered the arbitrators to determine the issues of tort liability and allowable damages under the wrongful death statute. We will not, and indeed cannot, simply substitute our findings (assuming they might be different) for that of the arbitrators. No error is evident from the face of the arbitration award. The arbitration award merely states that the arbitrators found in plaintiff’s favor in the amount of $240,000. There is no separate record indicating the arbitrators’ findings of fact and law. Because the arbitrators were specifically empowered to determine the issue of tort liability in this case, and they clearly did so, we find no error on the face of the arbitration award.
Defendant merely attempts to have us review the merits of the arbitrators’ decision. This we cannot do. Gordon Sel-Way, supra, p 497. The arbitrators did not exceed their power, as set forth in the arbitration agreement, and the circuit court therefore did not err in denying defendant’s motion to vacate the arbitration decision.
DOCKET NO. 176203
After the claim of appeal was filed in this case, plaintiff filed a motion to remand to amend the judgment. This Court granted the motion in an order dated April 29, 1994. On remand, the circuit court amended the judgment to include taxable costs to plaintiff in the amount of $12,803.05. Defendant argues that the circuit court erred in modifying the arbitration award to include taxable costs.
The arbitration agreement in this case provides that “the arbitration award, if any, shall be deemed to include all interest, costs, attorney fees and sanctions.” The arbitration agreement also provides that “[e]ach party shall pay for the cost of its arbitrator and the cost of the neutral arbitrator shall be shared equally by the parties.” MCR 3.602(M) provides:
The costs of the proceedings may be taxed as in civil actions, and, if provision for the fees and expenses of the arbitrator has not been made in the award, the court may allow compensation for the arbitrator’s services as it deems just. The arbitrator’s compensation is a taxable cost in the action.
The terms of the arbitration agreement dictate that the arbitration award of $240,000 is deemed to include all interest, costs, attorney fees, and sanctions. Therefore, we must conclude that the circuit court erred in modifying the arbitration award to include taxable costs. The unambiguous terms of the arbitration agreement state that costs are deemed to be a part of the arbitration award.
Martin v Auto Club Ins Ass’n, 204 Mich App 138; 514 NW2d 197 (1994), is not dispositive of this issue. In Martin, the insurance policy likewise provided that the insured was to pay the insured’s arbitrator, that the insurance company would pay for its arbitrator, and that the expenses of the third arbitrator would be shared equally. After the arbitrators awarded the plaintiff $20,000 under the insurance policy, the plaintiff moved to confirm the arbitration award because the defendant failed to make payment on it. In Martin, provision for the arbitrators’ fees and expenses had not been made in the arbitration award. Accordingly, this Court held that the plaintiff was entitled to arbitration fees under MCR 3.602(M) because the court rule specifically provides that if provision for the compensation of the arbitrators has not been made in the arbitration award, then the court may allow compensation for the arbitrators’ services. Martin, supra, pp 140-141.
In the present case, the arbitration agreement clearly provides that the arbitration award was deemed to include all interest, costs, attorney fees, and sanctions. Therefore, provision for all costs has been made in the arbitration award, and plaintiff is not entitled to the additional costs as awarded by the circuit court under MCR 3.602(M). We must assume that the arbitration award includes interest, costs, attorney fees, and sanctions because it is the arbitration agreement that confers upon the arbitrators their authority to act, and they are bound to act within the terms of the arbitration agreement. Gordon Sel-Way, supra, p 496. Therefore, the circuit court erred in modifying the arbitration award to include costs under MCR 3.602(M) because the arbitration award includes those costs as stated in the arbitration agreement.
Accordingly, we reverse the circuit court’s decision to modify the arbitration award to include taxable costs in the amount of $12,803.05 because the arbitration award, by the terms of the arbitration agreement, included costs.
The circuit court’s order entering judgment in plaintiff’s favor in the amount of the arbitration award is affirmed, and the circuit court’s order modifying the arbitration award to include taxable costs is reversed. | [
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Per Curiam.
In this indemnity action, plaintiff Oakland County Board of County Road Commissioners appeals as of right from a circuit court order granting summary disposition for defendant Michigan Property & Casualty Guaranty Association pursuant to MCR 2.116(C)(8) and (10).* We affirm.
i
Plaintiff is a governmental entity primarily responsible for building, repairing, and maintaining county roads, bridges, culverts, and other components of the county’s infrastructure. Between 1981 and 1985, plaintiff maintained general liability insurance through Midland Insurance Company. During the policy period, personal injury claims were made against plaintiff, who sought coverage and indemnification from Midland. In April 1986, Midland was deemed insolvent and was liquidated by the New York Superintendent of Insurance. Plaintiff eventually paid the third-party claims and then sought indemnification from the Michigan Property & Casualty Guaranty Association, a statutorily created association of property and casualty insurers licensed to do business in Michigan. MCL 500.7901 et seq.; MSA 24.17901 et seq. Under the Property & Casualty Guaranty Association Act, the association has a duty to pay certain obligations of insolvent insurers. The association refused to indemnify plaintiff on the basis that plaintiff’s net worth exceeded the statutory maximum and therefore its claims did not constitute “covered claims” under the act. Plaintiff filed this action, alleging that the net worth exclusion found in § 7925(3) of the act, MCL 500.7925(3); MSA 24.17925(3), violated the equal protection provisions of the United States and Michigan Constitutions and seeking a declaratory ruling that it was not subject to the exclusion. The association and plaintiff filed cross-motions for summary disposition under MCR 2.116(C)(8) and (10). The trial court denied plaintiff’s motion and granted defendant’s motion, concluding that the net worth exclusion did not violate equal protection provisions and that the exclusion applied to plaintiff, as the insured of an insolvent insurer.
n
On appeal, plaintiff first asserts that the trial court erred in finding that the net worth exclusion applied to plaintiff. We find no error.
Under § 7925 of the act, the association has the duty to pay obligations of insolvent insurers that come within the act’s definition of “covered claims”:
(1) “Covered claims” means obligations of an insolvent insurer which meet all of the following requirements:
(a) Arise out of the insurance policy contracts of the insolvent insurer issued to residents of this state or are payable to residents of this state on behalf of insureds of the insolvent insurer.
(b) Were unpaid by the insolvent insurer.
(c) Are presented as a claim to the receiver in this state or the association on or before the last date fixed for the filing of claims in the domiciliary delinquency proceedings.
(d) Were incurred or existed before, at the time of, or within 30 days after the date the receiver was appointed.
(e) Arise out of policy contracts of the insolvent insurer issued for all kinds of insurance except life and disability insurance.
(f) Arise out of insurance policy contracts issued on or before the last date on which the insolvent insurer was a member insurer.
* * *
(3) Covered claims shall not include obligations to an insurer, insurance pool, underwriting association, or to a person who has a net worth greater than 1/10 of 1% of the aggregate premiums written by member insurers in this state in the preceding calendar year. [MCL 500.7925(1) and (3); MSA 24.17925(1) and (3).]
Plaintiff argues that, because its policy with Midland provided for third-party liability coverage, the net worth exclusion in § 7925(3) refers only to the net worth of “persons” who are third-party claimants, not plaintiff itself as Midland’s insured. On the specific facts of this case, we disagree with plaintiff’s argument.
“The act is designed to protect from potentially catastrophic loss persons who have a right to rely on the existence of an insurance policy — the insureds and persons with claims against the insureds.” Metry, Metry, Sanom & Ashare v Michigan Property & Casualty Guaranty Ass’n, 403 Mich 117, 121; 267 NW2d 695 (1978). See also Yetzke v Fausak, 194 Mich App 414, 418; 488 NW2d 222 (1992). The association is guided by two interrelated principles: protection and preservation. That is, the association’s limited resources must be preserved so that those insureds and persons with claims against the insureds who are unable to absorb the loss are protected. The net worth exclusion in § 7925(3) was intended to effectuate these fundamental principles. Hence, as a general rule, where a claim constitutes an obligation of an insolvent insurer that is payable to a Michigan resident on behalf of an insured of the insolvent insurer, we hold that the net worth exclusion applies to the insured and to the insured’s third-party claimants who reside in Michigan. No other interpretation of the act satisfies both principles of protection and preservation.
Furthermore, we note that § 7925(3) evaluates the net worth of a “person,” which is defined broadly under the Insurance Code to include
an individual, insurer, company, association, organization, Lloyds, society, reciprocal or inter-insurance exchange, partnership, syndicate, business trust, corporation, and any other legal entity. [MCL 500.114; MSA 24.1114.]
Clearly, the Legislature contemplated preserving the association’s limited resources by precluding recovery by a broad range of claimants whose net worth exceeds the statutory limit.
In determining whether the net worth exclusion applies in a particular circumstance, it is irrelevant whether the insolvent insurer’s insured or the insured’s third-party claimant is seeking direct reimbursement from the association. Effective third-party practice permits proper application of the net worth exclusion, whichever party is seeking reimbursement. To hold otherwise might encourage insureds of an insolvent insurer to withhold or delay the satisfaction of valid third-party claims.
To the extent that plaintiff’s claims against the association are “payable to residents of this state on behalf of” plaintiff, as an insured of the insolvent Midland Insurance Company, they constitute “covered claims” pursuant to § 7925(l)(a). However, because plaintiff’s claims arise from its Lability to third parties, the net worth exclusion in § 7925(3) must be applied to plaintiff and to plaintiff’s third-party claimants. Given that plaintiff has failed to rebut the association’s evidence that plaintiff’s net worth exceeded the statutory limit for the relevant period, we need look no further to conclude that plaintiff’s claims are excluded from coverage under the act.
Accordingly, summary disposition was properly granted to defendant association.
m
Plaintiff next asserts that, as a public entity, it does not have a calculable net worth. We conclude that plaintiff has failed to raise a genuine issue of material fact regarding this issue, and that summary disposition was properly granted as a matter of law. MCR 2.116(CX10).
In support of its motion for summary disposition, defendant submitted an affidavit of Nola Yew, a certified public accountant specializing in governmental auditing. Yew averred that a governmental entity has assets and liabilities similar to a company in the private sector, and thus has a calculable net worth. Yew further averred that plaintiff had a net worth of $18,446,051 for 1985, which exceeded the net worth limit under the act of $5,820,973 in 1985. In its response to defendant’s motion, plaintiff did not submit any affidavit or other documentary evidence to rebut either Yew’s averment that plaintiff had a calculable net worth or Yew’s calculation of plaintiff’s net worth. Accordingly, plaintiff failed to meet its evidentiary burden under MCR 2.116(G)(4) to raise a genuine issue of material fact for trial. See Patterson v Kleiman, 447 Mich 429, 432; 526 NW2d 879 (1994). Summary disposition was properly granted to defendant. MCR 2.116(C)(10).
IV
Plaintiff further asserts that the net worth exclusion violates its right to equal protection of the law. We find no merit to this argument.
Plaintiff, as a governmental entity created by the Legislature, “ ‘has no privileges or immunities under the federal constitution which it may invoke in opposition to the will of its creator.’ ” Berrien Co v Michigan, 136 Mich App 772, 778; 357 NW2d 764 (1984), quoting Williams v Mayor & City Council of Baltimore, 289 US 36, 40; 53 S Ct 431; 77 L Ed 1015 (1933). Accordingly, we conclude that plaintiff has failed to state a claim upon which relief may be granted and that summary disposition of this claim is proper under MCR 2.116(C)(8).
Nonetheless, were we to address the merits of plaintiff’s equal protection challenge, we would adopt, as our own the analysis of the Sixth Circuit Court of Appeals in Borman’s Inc v Michigan Property & Casualty Guaranty Ass’n, 925 F2d 160 (CA 6, 1991), cert den 502 US 823 (1991). In Borman’s, the court reviewed the net worth exclusion in § 7925(3) under the rational basis standard and held that it did not violate the equal protection provisions of the state and federal constitutions. Id. at 162, n 1, 163.
Affirmed.
Michael J. Kelly, J., concurs in the result only.
Defendant insurance commissioner was dismissed from the case and is not a party to this appeal.
We emphasize that this general rule will apply in most, but not all, cases. Each case must be determined on its own specific facts with the intent of furthering the overall purposes of the act. For example, we express no opinion regarding the circumstance where an insured’s net worth does not exceed the statutory limit, but a third-party claimant’s does. That particular circumstance does not lend itself to bright-line rules, and we expressly leave that issue for another day. See, e.g., Georgia Insurers Insolvency Pool v Southeast Atlantic Cargo Operators, Inc, 211 Ga App 660; 440 SE2d 254 (1994); United States v Rutland, Inc, 849 F Supp 806 (SD Ga, 1994), aff’d 46 F3d 71 (CA 11, 1995). | [
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Per Curiam.
Defendant pleaded guilty on April 21, 1987, of possession of between 50 and 225 grams of a substance containing cocaine, MCL 333.7403(2)(a) (iii); MSA 14.15(7403)(2)(a)(iii), and on November 2, 1987, was sentenced to lifetime probation. On May 17, 1994, defendant moved for expunction of that conviction pursuant to MCL 780.621; MSA 28.1274(101). On September 12, 1994, the trial court denied the motion on the ground of lack of authority. Defendant appeals as of right.
The issue is whether the trial court erred in refusing to consider and grant defendant’s motion for expungement of an offense for which defendant was serving a sentence of lifetime probation.
The primary rule of statutory construction is to determine and effectuate the intent of the Legislature through reasonable construction in consideration of the purpose of the statute and the object sought to be accomplished. Gross v General Motors Corp, 448 Mich 147, 158-159; 528 NW2d 707 (1995). In inteipreting a statute, the meaning of the Legislature is to be found in the terms and arrangement of the statute without straining or refinement, and the expressions used are to be taken in their natural and ordinary sense. Id., 160. Statutes must be construed to prevent absurd or illogical results and to give effect to their purposes. Id., 164.
A fundamental rule of statutory construction is that we must ascertain and give effect to the Legislature’s intent. Wortelboer v Benzie Co, 212 Mich App 208, 215; 537 NW2d 603 (1995). While we presume the Legislature intended the meaning plainly expressed in a statute, judicial construction is permitted if the language is unclear and susceptible to more than one interpretation.
It is clear that the Legislature, in enacting MCL 771.2; MSA 28.1132, intended that once a sentence of lifetime probation is imposed, the court can change it (reduce it) only by imposing imprisonment. If the trial court granted defendant’s motion to set aside his conviction, it would surely “reduce” his lifetime probation and would be in direct violation of the statute under which defendant was sentenced, which is clear and unambiguous. It would require that the trial court set aside the valid sentence of lifetime probation and impose a new sentence, which the court does not have the authority to do. That would violate Const 1963, art 5, § 14 because it would be, in essence, a reprieve, commutation, or pardon, which can be granted only by the Governor. Any other conclusion would lead to an absurd or illogical result that would undermine the intent of the Legislature in enacting the lifetime probation statute. The trial court was correct in its conclusion that it did not have authority to grant defendant’s motion.
The trial court’s decision denying defendant’s request for expungement of his conviction is affirmed.
Affirmed. | [
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] |
Per Curiam.
The United Auto Workers, Local 6888 (uaw) filed an unfair labor practice charge against Central Michigan University (cmu) on October 25, 1991. Following a hearing, a referee of the Michigan Employment Relations Commission recommended that the claim be dismissed. The UAW objected to the referee’s recommended order. On July 11, 1994, the merc board of review rejected the referee’s recommendation and made a finding that the provision in the former contract requiring CMU to compensate elected union representatives while they engaged in union activities was a mandatory subject of bargaining that had to be maintained during contract negotiations occurring after the UAW terminated the underlying contract. Cmu appeals the order of the merc board of review as of right.
Before the hearing referee, the UAW argued that CMU refused to honor the terms of the contract with regard to employee leave. Cmu denied the violation for the reason that the contract had expired. The merc ruled that the payment of release time was a mandatory subject of bargaining and was an obligation that survived the termination of the contract. Cmu claims error on appeal in the finding that “release time” is a mandatory bargaining subject that survived the contract. The UAW also claims that any obligation within the phrase “wages, hours, and other terms and conditions of employment” is a mandatory subject of bargaining.
The supplemental agreement of the parties to the 1988-91 contract, known as the 1989-90 supplemental agreement, provided that leave of absence pay would be granted to bargaining unit members attending union-related activities. The issue for this Court is the mandatory versus permissive status of the activities of members of a union bargaining unit once a contract ends. If the payment of wages to unit members is a mandatory requirement of bargaining, the obligation does not end with termination of the contract. On the other hand, if payment is a permissive item, the members of a union bargaining unit are not entitled to wages when the contract has ended.
A public employer is required to bargain in good faith with respect to wages, hours, and other terms and conditions of employment in a new contract. MCL 423.215; MSA 17.455(15); Wayne Co Government Bar Ass’n v Wayne Co, 169 Mich App 480, 485; 426 NW2d 750 (1988). These subjects are mandatory subjects of bargaining. Local 1467, Int’l Ass’n of Fire Fighters v Portage, 134 Mich App 466, 472; 352 NW2d 284 (1984). Absent an impasse, neither party may take unilateral action with respect to a mandatory subject of bargaining. Central Michigan Univ Faculty Ass’n v Central Michigan Univ, 404 Mich 268, 277; 273 NW2d 21 (1978); Wayne Co Government Bar Ass’n, supra at 486. An employer who unilaterally alters a mandatory subject of bargaining perpetrates an unfair labor practice. MCL 423.210(l)(e); MSA 17.455(10)(l)(e); Int’l Ass’n of Fire Fighters, supra at 473. Labor peace is fostered by not allowing unilateral action before impasse, in light of the ban against striking by public employees. MCL 423.202; MSA 17.455(2); Wayne Co Government Bar Ass’n, supra at 486. Provisions of the contract relating to wages, hours, and other terms and conditions of employment are handled case by case.
This Court gives due deference to the expertise of the merc. Michigan Employment Relations Comm v Detroit Symphony Orchestra, Inc, 393 Mich 116, 124; 223 NW2d 283 (1974); West Ottawa Ed Ass’n v West Ottawa Public Schools Bd of Ed, 126 Mich App 306, 313; 337 NW2d 533 (1983). However, MERC decisions contrary to law will be overturned. Allied Chemical & Alkali Workers, Local No 1 v Pittsburgh Plate Glass Co, 404 US 157; 92 S Ct 383; 30 L Ed 2d 341 (1971); West Ottawa Ed Ass’n, supra at 313.
The issue whether contractually provided union release time that compensates an elected union representative for time spent pursuing union activities is a mandatory bargaining subject constitutes an issue of first impression in this state. Because the controlling language of the Michigan statutory scheme is identical to federal law, compare MCL 423.215; MSA 17.455(15) with 29 USC 158(d), federal precedent acts as a persuasive authority in guiding this Court. Local 1277, Metropolitan Council No 23 AFSCME v Center Line, 414 Mich 642, 652; 327 NW2d 822 (1982). Michigan courts have adopted a liberal approach to a determination of the subjects that are classified as mandatory bargaining items in view of public employees being precluded from going on strike. West Ottawa Ed Ass’n, supra at 315; Detroit Police Officers Ass’n v Detroit, 61 Mich App 487, 491; 233 NW2d 49 (1975).
The federal courts have found that paying members of a collective bargaining unit is a mandatory subject of bargaining even when the employer offered to negotiate during nonworking hours. The courts reasoned that such compensation benefited all members of the unit by encouraging the bargaining process and vitally affecting relationships between the members of the process. Axelson, Inc v NLRB, 599 F2d 91 (CA 5, 1979); accord NLRB v BASF Wyandotte Corp, 798 F2d 849, 852-853 (CA 5, 1986); General Battery Int’l Corp v Union de Servicios Y Mantenimientos Industriales de PR, 678 F Supp 33, 36 (D Puerto Rico, 1988). Midstate Telephone Corp v NLRB, 706 F2d 401, 405 (CA 2, 1983), cited Axelson in support of the conclusion that paying travel expenses of employee negotiators was a mandatory bargaining topic. See also Procter & Gamble Mfg Co v NLRB, 658 F2d 968, 977 (CA 4, 1981), where the unilateral change in the practice of paying employees for negotiating time was held to be an unfair labor practice.
The decision of the MERC board of review was supported by competent, material evidence and was not contrary to law. The MERC board of review’s determination that the release-time policy had a significant effect upon either wages or the terms and conditions of employment was at least reasonable. See Axelson, supra at 94. Therefore, we must affirm the ruling of the MERC board of review. This conclusion is supported by persuasive federal authority. BASF Wyandotte, supra at 852-853; Axelson, supra at 93, 94. Service Employees Int’l Union, Local 586 v Muskegon, 1980 MERC Lab Op 849, cited by CMU, does not undermine this analysis, and neither the referee nor the board of review misinterpreted MERC precedent when each ruled that case inapplicable. In that opinion, the MERC expressly declined to rule concerning whether release time was a mandatory topic of bargaining.
Because CMU raised two additional novel arguments not raised before nor addressed by the merc but has made no claim that there exists an extraordinary circumstance to excuse its failure to raise these issues below, this Court will not usurp the authority of the MERC by addressing these issues for the first time on appeal. West Ottawa Ed Ass’n, supra at 317.
The MERC did not rule contrary to law or to the substantial evidence on the record when it found that cmu’s release-time program constituted a mandatory bargaining topic that cmu needed to maintain throughout contract negotiations.
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Per Curiam.
On May 19, 1995, we issued our opinion in this matter, Gora v Ferndale, 210 Mich App 622; 533 NW2d 840 (1995). On April 29, 1996, our Supreme Court, in lieu of granting leave to appeal, issued an order remanding this case for reconsideration in light of 1995 PA 104 and for consideration of the issues raised but not addressed in our original opinion. Gora v Ferndale 451 Mich 875 (1996). On remand, we considered defendant City of Femdale’s arguments that the circuit court erred in finding unconstitutional certain portions of its ordinance regulating massage parlors and practitioners (massagists). We affirm in part and reverse in part.
Femdale’s Ordinance No. 832, amended by Ordinance No. 836, contained numerous provisions regulating massage parlors and massagists. Section 7-247(a) and (b) require that both massage parlors and massagists have valid city permits to practice their trade in Ferndale. Sections 7-249 and 7-250 set forth the requirements for obtaining such permits. In order to obtain a massage parlor license, § 7-249(m) requires that the applicant show proof of having graduated from a “recognized school or other institution of learning” that taught massage. Similarly, in order to obtain a massagist’s permit, an applicant must show proof of graduation from a recognized school or of being currently enrolled in a recognized school. Section 7-247(k) defines recognized school or massage school as including “any school or educational institution licensed to do business in the state in which it is located, or any school recognized by . . . the American Massage and Therapy Association, Inc., and which has for its purpose the teaching of . . . massage.”
Section 7-266 of the ordinance specifies several unlawful acts. Section 7- 266(a) prohibits massagists from treating persons of the opposite sex except upon the signed order of a licensed physician, chiropractor, or physical therapist. Massage parlors are required to keep specific records of any such mixed-gender massages, and such records are subject to inspection by police. Section 7-266(b) prohibits any person in a massage establishment from touching “a sexual or genital part of any other person.” Section 7-266(b) provides that “sexual or genital parts shall include the genitals, pubic area, buttocks, anus, or perineum of any person, or the vulva or breasts of a female.” Section 7-266(c) similarly prohibits any person in a massage establishment from “exposing his or her sexual or genital parts ... to any other person.” Section 7-266(d) makes it illegal for persons in massage establishments “to fail to conceal with a fully opaque covering, the sexual or genital parts of his or her body.”
Section 7-265 of the ordinance allows the chief of police or authorized inspectors from the city to inspect massage businesses to determine compliance with the ordinance and makes it illegal to refuse access to the premises or otherwise hinder such an inspection.
Additionally, § 7-261 prohibits anyone less than eighteen years old from being on the premises of a massage parlor, and § 7-255(b) requires that every patron of a massage parlor provide proof of identity by showing a valid driver’s license or similar identification.
The circuit court concluded that the educational requirements of §§ 7-249(m) and 7-250(i) violated plaintiffs’ due process rights because those requirements constituted an unreasonable and undue burden on the plaintiffs’ right to practice their profession. The circuit court noted that the risk of potential harm from the nontherapeutic massages practiced by plaintiffs was minimal, so the educational standards were not necessary.
The circuit court found that the prohibition against mixed-gender massage contained in § 7-266(a) violated the constitutional rights of privacy and association and that the blanket-type classification by sex was prohibited by the Equal Protection Clause of the Fourteenth Amendment. The circuit court found that the requirement that a patron show identification did not violate privacy rights, but that any record keeping requirements would violate privacy rights.
The circuit court found that § 7-265 violated the constitutional right of privacy and was unduly oppressive because it provided for criminal prosecution for refusing to allow inspection and did not limit inspections to business hours and other reasonable times. The court noted that § 7-265 did not clearly establish that a massagist who conducts massages in private homes would not be subject to the same provisions providing for searches without a warrant. The court found that a provision allowing an initial inspection upon issuance of a permit to ensure compliance and reasonable inspections without a warrant during reasonable times and under reasonable conditions could be permissible.
Finally, the circuit court concluded that § 7-266(b), (c), and (d), prohibiting touching or exposure of sexual or genital body parts, were void for vagueness because they encouraged arbitrary enforcement. The court further found that the absence of a scienter requirement created the possibility that innocent or inadvertent acts would be punished and that the language of the ordinance was not sufficiently precise because it failed to give fair warning of what type of exposure would run afoul of the law.
Following entry of the circuit court’s opinion, defendant moved for a remand to correct the opinion because the final order indicated that § 7-255(b) of the ordinance was unconstitutional. On remand, the circuit court issued an order nunc pro tunc correcting the prior error.
i
Defendant argues that the circuit court erred in finding §§ 7-249 and 7-250 of defendant’s ordinance to be unconstitutional. We agree. The educational and licensing requirements of the ordinance do not violate constitutional guarantees of due process of law.
The right to engage in business is subject to the state’s police powers to enact laws in furtherance of the public health, safety, welfare, and morals. Grocers Dairy Co v Dep’t of Agriculture Director, 377 Mich 71, 75; 138 NW2d 767 (1966). Statutes and ordinances are presumed constitutional, and courts should construe them in a constitutional manner. Detroit v Qualls, 434 Mich 340, 364; 454 NW2d 374 (1990); Ullery v Sobie, 196 Mich App 76, 79; 492 NW2d 739 (1992). The party challenging an ordinance has the burden of proving it invalid. Id. at 79.
The due process guarantees under the Michigan Constitution, Const 1963, art 1, § 17, provide no greater protection than those guaranteed by the United States Constitution. Saxon v Dep’t of Social Services, 191 Mich App 689, 698; 479 NW2d 361 (1991). Where an ordinance is challenged on substantive due process grounds because of its interference with economic or business activity, the challenger must establish either that no legitimate public purpose is served by the legislation or that there is no rational relationship between the ordinance’s provisions and a legitimate public purpose. Qualls, supra at 365; Ullery, supra at 80; Ludington & N R Co v Epworth Assembly, 188 Mich App 25, 43-44; 468 NW2d 727 (1991).
A review of the pertinent provisions of defendant’s ordinance shows that the ordinance was designed to serve a legitimate public purpose, namely, to discourage surreptitious prostitution at massage parlors. This public purpose was related to the public health, safety, welfare, and morals. The licensing and education requirements of §§ 7-249 and 7-250 were rationally related to this public purpose because they ensured that only persons who possessed a certain amount of training in myomassology could be licensed as massagists in Femdale. The ordinance requirements would have the effect of ensuring that only serious practitioners of massage would be operating massage parlors or be employed as massagists, thereby decreasing the likelihood that a massage establishment would merely be a front for prostitution.
n
Defendant argues that the circuit court erred in finding § 7-266(a) of its ordinance unconstitutional. We disagree. Section 7-266(a)’s prohibition of mixed-gender massage violates equal protection of law.
The equal protection guarantees contained in Michigan’s constitution, Const 1963, art 1, § 2, provide no greater protection than those guaranteed under the Fourteenth Amendment of the United States Constitution. Doe v Dep’t of Social Services, 439 Mich 650; 672; 487 NW2d 166 (1992). Equal protection analysis depends upon the type of statutory classification and the nature of the interest affected. Ullery, supra at 81.
Where the legislative classification does not involve a suspect classification or interference with a fundamental right, we use the rational-basis test, under which a statutory classification is upheld where it is rationally related to a legitimate government purpose. Doe, supra at 662.
Where the statutory scheme creates a classification based upon suspect factors such as ethnicity or national origin, or impinges upon the exercise of a fundamental right, we use the strict-scrutiny test. Under strict scrutiny, a statutory classification is upheld only where the state demonstrates that its classification scheme has been precisely tailored to serve a compelling government interest. Id. at 662.
Classification schemes based upon gender uses the intermediate or heightened-scrutiny test. Dep’t of Civil Rights v Waterford Twp Dep’t of Parks & Recreation, 425 Mich 173, 191; 387 NW2d 821 (1986). To pass heightened scrutiny, the classification must serve an important governmental purpose and must be substantially related to achieving that important government objective. Id. Under heightened scrutiny, the state or municipality bears the burden of showing that the interest is important and that the means is substantially related to the desired end. Id. at 196. Our Supreme Court noted: Facts and circumstances play a large part in assessing the end-means relationship. While the [substantial] relationship need not be perfect, it should be close.” Id. at 202 (emphasis added).
Section 7-266(a) of defendant’s ordinance is directed at an important public purpose, mainly the prevention of prostitution at massage parlors. Defendant’s brief does not explain how the means of prohib iting mixed-gender massage is substantially related toward this end. Although prohibiting massage performed upon persons of the opposite gender would certainly prevent any sort of heterosexual contact between female masseuses and male customers, it would also cut the available number of plaintiff’s prospective customers in half, significantly affecting their business. Although defendant’s goal is legitimate, the prohibition applied to accomplish that goal is far too broad to be considered substantially related under the heightened-scrutiny test.
m
Defendant argues that the circuit court erred in finding unconstitutional § 7-265 of its ordinance, which permitted searches of premises without a warrant. We disagree. The circuit court properly concluded that § 7-265 is unconstitutional and invalid to the extent that it authorizes inspections or searches without a warrant or the equivalent.
The Fourth Amendment of the United States Constitution protects commercial buildings from unreasonable searches and seizures. Marshall v Barlow’s, Inc, 436 US 307, 311-312; 98 S Ct 1816; 56 L Ed 2d 305 (1978). In Marshall, the United States Supreme Court concluded that statutes allowing the search of a commercial building without a warrant or the equivalent violated Fourth Amendment guarantees against illegal searches and seizures. Id. at 310, 325. However, statutes can allow inspections pursuant to regulations and judicial processes that satisfy Fourth Amendment requirements. Id. Additionally, certain businesses and industries have such a history of government oversight that no reasonable expectation of privacy can exist. By choosing to participate in such pervasively or closely regulated businesses, the business owner has chosen to voluntarily subject himself to all applicable government regulations, including inspections without a warrant. Id. at 313; see also Tallman v Dep’t of Natural Resources, 421 Mich 585, 604-605; 365 NW2d 724 (1984). Such pervasively regulated businesses include the liquor and firearms industries. United States v Biswell, 406 US 311; 92 S Ct 1593; 32 L Ed 2d 87 (1972); Colonnade Catering Corp v United States, 397 US 72; 90 S Ct 774; 25 L Ed 2d 60 (1970). The pervasiveness and regularity of an enforcement scheme, rather than its longevity, are the relevant considerations to determine whether a business falls within this exception. Tallman, supra at 607.
In Marshall, supra at 313, the Supreme Court pointed out that the closely regulated industry is the rare exception, rather than the rule. The massage parlor business does not have a long history of regulation in Michigan and is not pervasively or closely regulated at this time. Although the Occupational Code at one time covered the regulation of massage establishments and practitioners, no state-wide rules were ever promulgated regulating commercial massage parlors or massages. The fact that plaintiffs have opted to open massage parlors or practice massage does not signify consent to subject themselves to searches or inspections that do not comply with Fourth Amendment requirements.
IV
Defendant argues that the circuit court erred in concluding that subsections b, c, and d of § 7-266 were unconstitutionally vague. We agree.
Statutory language that forbids an act in terms so vague that a person of common intelligence must guess at its meaning violates due process of law. People v Capriccioso, 207 Mich App 100, 102; 523 NW2d 846 (1994). Statutory language is unconstitutionally vague under three circumstances: (1) where it is over-broad and impinges on First Amendment freedom, (2) where it fails to provide fair notice of the proscribed conduct, or (3) where it is so indefinite as to confer unstructured and unlimited discretion upon the trier of fact to determine whether an offense has been committed. People v Hayes, 421 Mich 271, 283; 364 NW2d 635 (1984).
An ordinance must be interpreted in a constitutional manner if possible. Qualls, supra at 364. Subsection b, c, and d of § 7-266 of defendant’s ordinance are not unconstitutionally vague. The prohibition against the exposure or touching of sexual or genital areas does not impinge upon First Amendment freedoms. These provisions clearly define a sexual or genital area and provide fair notice of the proscribed conduct. For example, § 7-266(b) states that it is “unlawful for any person, in a massage establishment ... to touch . . . the sexual or genital parts of any other person” and defines sexual or genital parts as “the genitals, pubic area, buttocks, anus, or perineum ... or the vulva or breasts of a female.” Section 7- 266 is not so indefinite as to give a trier of fact unlimited discretion to determine whether a violation took place. Nor is a scienter element necessary to make the proscribed conduct criminal; a legislative body may define a crime without regard to the presence of specific criminal intent. People v McKee, 15 Mich App 382, 385; 166 NW2d 688 (1968).
For the above reasons, we reverse the circuit court’s findings that §§ 7-249, 7-250, and 7-266(b)-(d) of Femdale’s ordinance are unconstitutional. We affirm the circuit court’s findings that § 7-266(a) is unconstitutional and invalid to the extent that it prohibits mixed-gender messages and that § 7-265 is unconstitutional and invalid to the extent that it authorizes inspections or searches without a warrant or the equivalent.
We previously determined that the City of Femdale’s ordinance was preempted by those portions of the Occupational Code regulating myomassology, MCL 339.1701 et seq.; MSA 18.425(1701) et seq. Since the release of our original opinion, the Legislature passed 1995 PA 104, which repealed those sections of the Occupational Code that dealt with myomassology. Accordingly, the Occupational Code no longer preempts local regulation of massage parlors and massagists.
On appeal, the city maintains that its ordinance does not require massage parlors to keep records of their customers.
On appeal, defendant argues that the circuit court erred in its ruling regarding § 7-255(b) of the ordinance. Because defendant has already received the requested relief by means of the circuit court’s order nunc pro tunc, this issue is moot and will not be addressed on appeal. People v Greensburg, 176 Mich App 296, 302; 439 NW2d 336 (1989). | [
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O’Connell, P.J.
This action for breach of an insurance contract originated in the district court. In Docket No. 176864, defendant appeals the circuit court’s affirmance of the judgment on jury verdict entered in the district court. A panel of this Court originally denied defendant’s application for leave to appeal, but pursuant to Supreme Court order, we now consider defendant’s appeal pursuant to MCR 7.302(F)(1) as on leave granted. 445 Mich 936 (1994). In Docket No. 174750, defendant appeals by leave granted the circuit court’s affirmance of the order of the district court taxing costs pursuant to MCR 2.403(0) against defendant.
We have consolidated these appeals to facilitate our review. In Docket No. 176864, we reverse the circuit court’s affirmance of the judgment of the district court and remand for a new trial. In Docket No. 174750, we vacate the order of the district court taxing costs and the circuit court’s affirmance of that order.
i
Plaintiff Charles Cook purchased a used Ford Tempo for his daughter, plaintiff Frances Cook. Plain tiffs insured the automobile with defendant. The automobile insurance policy covered, among other things, theft and arson.
Approximately nine months later, the Tempo was found burned beyond repair under suspicious circumstances. Plaintiffs reported the loss to defendant, claiming that the automobile had been stolen and destroyed. Defendant refused to pay the claim, contending that plaintiffs had attempted to commit insurance fraud. Defendant, however, did not pursue the criminal prosecution of plaintiffs, and plaintiffs were never prosecuted.
Plaintiffs brought this action for breach of an insurance contract against defendant in the district court. Before trial, defendant moved in limine to exclude all mention of the fact that plaintiffs were not charged with any crime in connection with the destruction of the Tempo. The district court denied the motion. During trial, plaintiffs’ counsel elicited from an employee of defendant testimony that defendant had declined to pursue criminal prosecution in the matter, the damaging effect of which was mitigated to some extent by the witness’ disclosure that defendant, as a rule, did not pursue criminal prosecution. Plaintiffs’ counsel referred to defendant’s inaction during closing argument, asking the jury: “[W]hy wasn’t there an insurance fraud claimed? That bugs the heck out of me. I don’t know how you guys feel about it.”
The jury was persuaded that plaintiffs had committed no fraud and awarded them just over $3,500. Defendant appealed as of right to the circuit court, which affirmed. This Court initially denied defendant’s application for leave to appeal, but upon the Supreme Court’s order, we now consider defendant’s appeal as on leave granted.
n
Defendant contends that the district court committed error requiring reversal in denying defendant’s motion to exclude evidence that plaintiffs had not faced criminal prosecution. Our review of the case law indicates that defendant is correct.
This issue appears to be one of first impression in Michigan, though our courts have dealt with similar issues. For example, this Court has previously held that an insured’s arson conviction may be used to bar the insured’s recovery in a suit to determine insurance coverage. Ramon v Farm Bureau Ins Co, 184 Mich App 54, 59-60; 457 NW2d 90 (1990). We must now consider the converse, whether an insured’s acquittal, or the absence of criminal prosecution altogether, may be used by the insured as a sword in a similar suit.
Without exception, all the courts that have considered this issue have concluded that evidence of acquittal or lack of prosecution is not admissible in an insured’s suit against the insurer. See, e.g., Kelly’s Auto Parts, No 1, Inc, v Boughton, 809 F2d 1247, 1251-1253 (CA 6, 1987); American Home Assurance Co v Sunshine Supermarket, Inc, 753 F2d 321, 325 (CA 3, 1985); Galbraith v Hartford Fire Ins Co, 464 F2d 225, 227 (CA 3, 1972); Rabon v Great Southwest Fire Ins Co, 818 F2d 306, 309 (CA 4, 1987); Weathers v American Family Mutual Ins Co, 793 F Supp 1002, 1015 (D Kan, 1992); Krueger v State Farm Fire & Casualty Co, 510 NW2d 204, 210-211 (Minn App, 1993); Dawson v Miller, 594 So 2d 970, 972 (La App, 1992). The rationale underlying this unanimity of opinion does not vary. First, evidence of acquittal or the lack of prosecution is highly prejudicial because it goes to the principal issue before the jury. Krueger, supra. Second, though highly prejudicial, “such evidence has little or no probative value, because of the different burdens of proof. The difference is between preponderance of the evidence in civil cases and proof beyond a reasonable doubt in criminal cases.” Dawson, supra. Finally, with respect to lack of prosecution only,
a prosecutor’s decision to nolle prosse may take into account many factors irrelevant in a civil suit, such as the higher standard of proof required for criminal conviction. In any event, a prosecutor’s opinion whether the insured started the fire is inadmissible since it is based on knowledge outside his personal experience. [Rabón, supra, p 309.]
We find the reasoning of the cases cited above to be persuasive and adopt it as our own.
In the present case, plaintiffs faced no criminal prosecution with respect to the destruction of the Tempo. Defendant’s motion to exclude evidence of this was denied. Plaintiffs’ counsel proceeded to elicit damaging testimony from an employee of defendant that defendant had declined to seek prosecution of plaintiffs, and also used this information to good effect during closing argument. The prejudice is evident. For the reasons set forth in the preceding paragraphs, this prejudice outweighed any probative value of the evidence. See MRE 403. Therefore, we conclude that the district court abused its discretion in denying defendant’s motion in limine.
The only remaining question in this context is whether the court’s abuse of discretion may be considered harmless error. Error may not be predicated on an evidentiary ruling unless a substantial light was affected. MRE 103(a). As set forth in Krueger, supra, p 210, “[i]n the federal courts, it is reversible error to permit an insured seeking the proceeds of a fire insurance policy to present evidence of nonprosecution or acquittal on criminal arson charges.” This Court is aware of no published decision, state or federal, in which the admission of evidence pertaining to an insured’s acquittal or lack of prosecution was held to be harmless error. Rather than establish a bright-line rule in regard to harmless error, we hold that under the circumstances that exist here, the admission of evidence of an insured’s acquittal or lack of prosecution may not be considered harmless error. Whether under different factual circumstances it can ever be “harmless error” correctable by a jury instruction is best left for another day.
Accordingly, we reverse in Docket No. 176864 and remand for a new trial. It is unnecessary that we reach defendant’s remaining allegations of error with respect to the district court’s evidentiary rulings.
in
In Docket No. 174750, defendant submits that the district court erred in granting plaintiffs’ belated motion brought pursuant to MCR 2.403(0) for the taxation of costs. Because we have reversed the judgment upon which the order taxing costs is predicated, there is no basis for the taxation of costs. We, therefore, vacate the order taxing costs against defendant and the circuit court’s affirmance of that order.
In Docket No. 176864, the judgment of the district court and the order of the circuit court affirming that judgment are reversed, and the matter is remanded. We do not retain jurisdiction. In Docket No. 174750, the order taxing costs against defendant and the order of the circuit court affirming that order are vacated.
We note, however, that this type of evidence may sometimes be admissible for other purposes. See, e.g., Goffstein v State Farm Fire & Casualty Co, 764 F2d 522, 524-525 (CA 8, 1985) (evidence of lack of prosecution would have been admissible to cure court’s error in admitting extensive evidence of police investigation suggesting that the insured had been criminally charged, though court’s failure to admit evidence of lack of prosecution constituted harmless error). | [
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Bandstra, P.J.
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 was sentenced to consecutive sentences of ten to twenty-five years’ imprisonment for the armed robbery conviction and two years for the felony-firearm conviction, both of which were ordered to run concurrently with defendant’s sentence for unrelated federal offenses. In these consolidated appeals, defendant raises a number of issues regarding his convictions, and the prosecutor argues that the sentences should have been ordered to run consecutively to defendant’s federal sentence. We remand for resentencing. The incident that gave rise to the instant charges against defendant occurred while he was on parole from sentences he was serving for federal convictions of bank robbery and kidnapping. Defendant was convicted of robbing a person tending bar in Detroit. At a photographic lineup, the victim identified defendant as the person who had committed the robbery. The victim’s identification of defendant as the robber was corroborated by a bar patron. Defendant’s theory was that these witnesses had misidentified him and that, when the incident occurred in September of 1992, he was employed by and staying at the home of John Fisher, a Saugatuck, Michigan, home-repair contractor. Defendant contended that, on the date of the incident, September 5, 1992, Steve Aman, an associate of Fisher, had hired defendant to help install a hot water heater in a Fennville, Michigan, home. Both Fisher and Aman testified as alibi witnesses on defendant’s behalf.
Defendant argues that the prosecutor was improperly allowed to cross-examine Aman and Fisher regarding their failure to contact the police or the prosecution before trial. Defendant argues that, in the absence of any foundation testimony showing that it would have been natural for the alibi witnesses to come forward, this cross-examination was not relevant and unfairly prejudiced defendant. The prosecution responds, first, by arguing that defense counsel did not raise a relevancy objection at trial and that this issue is not properly preserved for appellate review. While the prosecutor has a good argument in this regard with respect to witness Aman, defense counsel did squarely object to the cross-examination of witness Fisher on relevancy grounds, arguing that Fisher’s failure to come forward was “immaterial.” We find that because of this objection, which was overruled by the trial court, the issue is preserved for our review.
Defendant relies primarily on People v Fuqua, 146 Mich App 250; 379 NW2d 442 (1985). In Fuqua, a panel of this Court reasoned that the credibility of an alibi witness may be attacked with cross-examination and argument showing that the witness failed to come forward with the alibi account before trial, when it would have been natural to do so. The panel further reasoned that this cross-examination or argument must be based on foundational questions regarding what it would have been natural for the witness to do. Id. at 256. The panel noted that in a New York case, People v Dawson, 50 NY2d 311; 428 NYS2d 914; 406 NE2d 771 (1980), the prosecutor was allowed to attack the credibility of a defense alibi witness only after laying a foundation showing that the witness was aware of the charges against the defendant and their nature, that the witness had reason to recognize that the witness possessed exculpatory information, that the witness had a reasonable motive to exonerate the defendant, and that the witness was familiar with the means to make such information available to the police. Id. at 255. The Fuqua panel directed that upon retrial of the case before it, which was being remanded for other reasons, “[t]here must be some showing, on the record, as to why it would have been natural for the alibi witness to relate his story to the police,” and that before the prosecutor would be allowed to impeach with regard to the fail ure to come forward issue, “an adequate foundation must be laid.” Id. at 256.
Under Supreme Court Administrative Order No. 1996-4, we are not bound by Fuqua, and we do not find its analysis persuasive. The concern of the New York court in Dawson, upon which the Fuqua analysis primarily relied, was that the trier of fact be provided assistance in its effort to determine whether the testimony of an alibi witness was an accurate reflection of the truth or, instead, a recent fabrication. Dawson, supra at 321. While we agree that the trier of fact can be assisted in this important task with information regarding the reasons that an alibi witness would have been more or less likely to come forward with alibi information before trial, we do not conclude that the prosecutor must lay any particular foundation before questioning a witness who has not come forward before trial. Presumably, if there are good reasons for a witness’ failure to come forward earlier, these will be brought out during the direct examination of the alibi witness by defense counsel. On those occasions where defense counsel has not anticipated the prosecutor’s cross-examination in this fashion, these reasons for failing to come forward earlier can be brought out during redirect examination.
The present case demonstrates how the trier of fact can be apprised of reasons for failing to come forward, even in the absence of any special foundation requirement. During cross-examination by the prosecutor, witness Fisher stated that he had contacted defendant to volunteer to come forward on defendant’s behalf, but was told that the case would likely “get thrown out[;] . . . [i]t’ll never go to court.” Similarly, following cross-examination questions regarding his failure to come forward to the police or prosecutor, Fisher stated: “Well, you kind of figure a travesty like that’s going to work itself out.” In response to cross-examination questions implying that witness Aman should have come forward to help defendant in previous court proceedings, Aman testified that he simply “didn’t know anything about” those proceedings. These explanations of the alibi witnesses’ failures to come forward earlier on defendant’s behalf could have been further developed by defense counsel either during direct or redirect examination. Even without any further explanation of these responses, the factfinder in this case was presented with enough information to determine whether the witnesses’ failure to come forward earlier was an understandable and excusable delay and, thus, was provided assistance in deciding whether to believe their alibi accounts.
The foundational rule of Fuqua would take this important issue from the factfinder in many cases. Under Fuqua, unless an alibi witness testifies in a fashion indicating that it would have been natural to come forward earlier, a prosecutor cannot impeach that witness by reference to the failure to come forward earlier. However, a witness who would fabricate an alibi account would also likely fabricate reasons for failing to come forward earlier. The prosecutor thus would be left without a foundation for impeach ing the witness with respect to this issue or arguing that the witness’ failure to come forward earlier suggests the alibi story was a recent fabrication. As a result, the factfinder would be left with no opportunity to consider the timeliness of the witness’ account in weighing the credibility of that account.
A juror or other factfinder is certainly qualified to consider whether offered reasons for an alibi witness’ delay in coming forward make sense, ring true, or are otherwise persuasive. The timeliness of an alibi account may be highly probative of its truthfulness; it may, in fact, be the best or only way to determine whether the alibi is credible. A witness should not be able to take the timeliness issue from the factfinder by fabricating “good” reasons for not coming forward earlier. We conclude that the trial court did not err in overruling defense counsel’s objections to the cross-examination questions at issue. The credibility of an alibi witness, regarding both the alibi account and the failure to come forward earlier with that account, should not be taken from the jury through the imposition of any special foundational requirement.
Defendant also argues that the prosecutor was improperly allowed to elicit testimony regarding defendant’s previous use of aliases. He argues that this evidence was irrelevant and unfairly prejudicial; we review to determine whether the decision to allow this evidence constituted an abuse of discretion. People v Bahoda, 448 Mich 261, 289; 531 NW2d 659 (1995). Although there is a split of authority in this Court regarding whether evidence of a defendant’s use of an alias can be used to impeach credibility, evidence of a defendant’s use of an alias is admissible to establish identity. People v Pointer, 133 Mich App 313, 316; 349 NW2d 174 (1984). Testimony regarding defendant’s aliases was elicited to help establish that defendant, who had been arrested in Arizona and extradited to Michigan, was in fact the same person named in the arrest warrant. There is no indication in the record that defendant was asked about his aliases because the prosecution was attempting to impeach his credibility rather than to show that the police had arrested the right person. There was no abuse of discretion in admitting this evidence.
Defendant argues that the prosecutor improperly denigrated defense counsel by arguing that defense counsel was trying to “confuse the issue.” We review questions of prosecutorial misconduct case by case, considering contested remarks in context and evaluating them in light of defense arguments and their relationship to the evidence presented at trial. People v Vaughn, 200 Mich App 32, 39; 504 NW2d 2 (1993). The prosecutor’s remarks at issue here were made during rebuttal argument and, in essence, charged that defense counsel had inaccurately summarized the evidence presented. We do not conclude that the prosecutor’s remarks personally attacked defense counsel or shifted the jury’s focus from the evidence to defense counsel’s personality. People v Moore, 189 Mich App 315, 322; 472 NW2d 1 (1991) (Wahls, P.J., concurring); People v Dalessandro, 165 Mich App 569, 579-580; 419 NW2d 609 (1988). We do not find that the prosecutor’s remarks were improper or that they denied defendant a fair trial.
Defendant’s final contention is that the Interstate Agreement on Detainers (iad), MCL 780.601 el seq.\ MSA 4.147(1) et seq., was violated and that, accordingly, the complaint against him should have been dismissed. However, the protections of this statute do not apply to federal parolees awaiting revocation. People v Wilden (On Rehearing), 197 Mich App 533, 539; 496 NW2d 801 (1992). Defendant’s parole was not officially revoked until July 16, 1993. Defendant’s trial commenced within 120 days of the September 30, 1993, detainer subsequently lodged against him, satisfying the provisions of Article IV (c) of the iad. MCL 780.601(art IV[c]); MSA 4.147(l)(art IV[c]). Further, defendant was not returned to his “original place of imprisonment” before the trial arising out of that detainer was completed. MCL 780.601 (art IV[e]); MSA 4.147(1) (art IV[e]). Defendant’s arguments that the Interstate Agreement on Detainers was violated are without merit.
The prosecutor argues that defendant’s sentences in the present case should have been imposed to run consecutively to those imposed for defendant’s federal convictions. A defendant who has been sen tenced in a federal court may not subsequently be sentenced to a consecutive sentence in state court in the absence of statutory authority. In re Carey, 372 Mich 378, 381; 126 NW2d 727 (1964). The prosecutor argues that the consecutive sentencing statute applicable in this case is MCL 768.7a(2); MSA 28.1030(1)(2), which provides:
If a person is convicted and sentenced to a term of imprisonment for a felony committed while the person was on parole from a sentence for a previous offense, the term of imprisonment imposed for the later offense shall begin to run at the expiration of the remaining portion of the term of imprisonment imposed for the previous offense.
Because defendant was on parole from a federal sentence for a previous offense at the time he committed the instant offenses, the prosecutor argues this statute applies and a consecutive sentence was mandated.
In People v Kirkland, 172 Mich App 735, 736-737; 432 NW2d 422 (1988), a panel of this Court noted that the purpose of the consecutive sentencing statute is to deter persons convicted of one crime from committing other crimes by removing the security of concurrent sentencing. Accordingly, “[t]he consecutive sentencing statute should be construed liberally in order to achieve the deterrent effect intended by the Legislature.” Id. at 737. In Kirkland, the argument concerned a subsection of the statute that requires consecutive sentences for “[a] person who is incarcerated in a penal or reformatory institution in this state” at the time of the sentenced offense. MCL 768.7a(l); MSA 28.1030(1)(1). The defendant argued that this language did not apply to him because he had been a federal inmate rather than a state inmate at the time of his offense. The Kirkland panel rejected this argument, reasoning:
Had the Legislature intended to restrict the statute’s application only to state penal or reformatory institutions, it would have included such restrictive language on the face of the statute. [Kirkland, supra at 737.]
Kirkland is instructive for our consideration of the section of the consecutive statute at issue here. By its terms, the statute applies to persons convicted of offenses that occurred while “on parole from a sentence for a previous offense.” Defendant would have us interpret this as applicable only to persons on parole for a previous state offense, but not to him because he is a federal parolee. As in Kirkland, however, “[h]ad the Legislature intended to restrict the statute’s application only to [state parolees], it would have included such restrictive language on the face of the statute.” While we agree with Kirkland that this statute must be liberally construed to effect its purposes, no liberal construction is required to conclude that defendant’s argument is clearly contradicted by the language of the statute itself.
Defendant also argues that we should infer that the statute’s provisions are limited to state, rather than federal, parolees because of the statutory requirement that a consecutive sentence shall begin to run “at the expiration of the remaining portion of the term of imprisonment imposed for the previous offense.” Defendant argues that, if the statute is applied to federal parolees, this somehow requires the illegal imposition upon the federal corrections department of a state requirement that federal parole violators serve the entire maximum term of their federal sentence before beginning serving their subsequent state sentence. No such requirement is imposed; the consecutive state sentence shall begin to run when the federal “term of imprisonment” ends, regardless of whether that term was the minimum or maximum imposed by a federal court. Defendant’s sentences for the armed robbery and felony-firearm convictions should have been imposed to run consecutively to his federal sentence, and it was error to order these sentences to run concurrently.
Finally, defendant argues that if his sentences are ordered to run consecutively to his federal sentence, he is entitled to credit for the time he served while awaiting trial in the present case. It appears from the judgment of sentence that defendant was given credit for 322 days. However, because of some confusion in defendant’s assertion, the trial court shall, upon remand, determine whether defendant is entitled to any additional credit.
We remand for entry of an order consistent with this opinion that provides that defendant’s sentences are to run consecutively to his federal sentence. Further, the judgment of sentence should reflect appropriate credit for days served as determined by the trial court. We do not retain jurisdiction.
These admonitions were provided by the Fuqua panel for direction to the trial court in a case where reversal was already required for different reasons. Fuqua did not consider whether the prosecutor’s error in improperly questioning the alibi witness would itself automatically require reversal or, instead, be subject to some sort of harmless-error analysis.
We note that there is no suggestion in the present case that the prosecutor improperly argued or implied that the alibi witnesses had a duty to come forward to tell their story earlier or that the alibi witnesses had been advised by defense counsel not to come forward earlier. See Fuqua, supra at 255.
We do not find our result inconsistent with People v Martinez, 190 Mich App 442; 476 NW2d 641 (1991). Applying a manifest injustice analysis, the Martinez panel did not require that the prosecutor lay some special foundation before questioning an alibi witness, but only noted that the facts established the alibi witness had a relationship with defendant, knew that defendant was in police custody, and believed defendant was innocent because he was with her at the time of the crime. Id. at 446-447. It is not clear whether these facts were elicited upon direct examination by defense counsel or by the prosecutor upon cross-examination. Similarly, from the testimony presented by the alibi witnesses in the present case, the jury was informed that the alibi witnesses had a relationship with defendant, wanted to help exonerate him, knew he was in custody for the crime, and believed he had not committed it because he was in West Michigan at the time it occurred. | [
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North, J.
This is a mandamus proceeding instituted in this Court. By Act No. 147, Pub. Acts 1939 (Comp. Laws Supp. 1940, § 2289-1 et seq., Stat. Ann. 1941 Cum. Supp. § 5.2148[1] et seq.), provision was made for the creation of the Huron-Clinton Metropolitan Authority, which we herein designate as the Authority. Section 1 of the act provides:
“As may hereinafter be provided in this act, the counties of Wayne, Washtenaw, Livingston, Oakland, and Macomb, or certain of such counties, may by vote of the electorate thereof, join to form a metropolitan district as a body corporate, to be known as the Huron-Clinton metropolitan authority, for the purpose of planning, promoting, and/or for acquiring, constructing, owning, developing, maintaining and operating, either within or without their limits, parks and/or limited access highways, as well as such connecting drives as may be deemed necessary or convenient to provide access to and between the same.”
Section 3 provides that the Authority in accomplishing its purposes may act alone or in cooperation with the department of conservation, the state highway department, any board of county road commissioners, or any Federal or other State or local body having authority to construct or maintain parks or highways; and that:
“Said authority may fix and collect fees and charges for use of facilities under its control, and, for its uses, may sell or purchase lands and maj acquire and succeed to any or all the rights, obligations, and property pertaining to parks or highways of the State or of any county, city, village, or township comprising territory within the limits of the said metropolitan district: Provided, That no county, city, village, or township shall surrender any such rights, obligations or property without the approval thereof by a majority vote of the electors of any such county, city, village or township, voting on such proposition.”
The Authority is directed and governed by a board of commissioners. One commissioner is elected by the board of supervisors from each county comprising the metropolitan district, and two commissioners are appointed by the governor. In each of the five counties named in the above-quoted section 1 the electors have voted to adopt the statutory plan for the Authority; and subsequently the commissioners were elected or appointed, and they have organized in the manner provided by statute. Section 7 of the act reads:
“The commissioners may levy for the purpose's of the authority a tax of not more than one-quarter mill upon each dollar of the assessed value of the property of the district. The board shall ascertain the total taxes or appropriation required for any year and shall thereupon certify to the board of supervisors of each county comprising the district the necessary tax rate to raise such amount, which shall be uniform in the district, and shall take into consideration the ratio that the total assessed valuation of each respective county bears to the total assessed value of all property, real and personal in said entire district according to the last assessment in each of said respective counties. All taxes shall be assessed, levied, collected and returned as county taxes under the general property tax law. All moneys collected by any tax collecting officer from the tax levied under the provisions of this section shall be transmitted to the authority to be disbursed as provided in this act.
“The subjects of taxation for the district purposes shall be the same as for State, county, and school purposes under the general law.”
The Authority acting through its board of commissioners on May 28, 1941, adopted a tentative budget in the amount of $163,235 for carrying out its purposes for the ensuing year and determined a tax should be levied at a maximum rate of 1/20 of one mill upon each dollar of the assessed valuation of the property in the metropolitan district; and at a later meeting on July 12, 1941, the Authority-confirmed the above action but with some modification or revision of the budget. And on September 9, 1941, the Authority adopted a resolution which provided for the levying of this tax and requested the boards of supervisors of the five counties to levy the tax in such counties. A request of the Authority was timely filed with the county clerk of each of the five counties named for an allocation of 1/20 of one mill on each dollar of assessed valuation for the ensuing tax year. In the counties of Washtenaw, Livingston and Macomb the county tax allocation board allocated a maximum rate of 1/20 of one mill for the purposes of the Authority and ordered this 1/20 of one mill to be taken out of the total allocated county tax rate. Similar action seems to have been.taken in Wayne county by the tax allocation board on Juné 2, 1941, but was rescinded July 15, 1941, and all of the county tax was allocated to the county purposes. No action was taken by the tax allocation board of Oakland county.
It is alleged in plaintiff’s petition that under Act No. 62, § 14, Pub. Acts 1933, as amended by Act No. 30, Pub. Acts 1934 (1st Ex. Sess.) (Comp. Laws Supp. 1940, § 3551-34, Stat. Ann. § 7.74), it was the duty of the defendant Edward H. Williams, chairman of the Wayne county tax allocation board, to call a meeting of the chairmen of the tax allocation boards of the five counties comprising the metropolitan district for their action in passing on and approving the maximum tax rate for the purposes of the Authority; and that Edward H. Williams as chairman of the Wayne county tax allocation board was requested to call a joint board meeting consisting of the chairmen of the tax allocation boards in these five counties for that purpose. Plaintiff in its petition further alleges that notwithstanding a request and a formal demand were made by it upon Edward H. Williams to call a meeting of the joint allocation board of the metropolitan district for the stated purpose he has refused to call such meeting on the ground that Act No. 147, Pub. Acts 1939, is unconstitutional. It is also alleged that the determination of the Authority as to the levying of this tax was likewise certified to the board of supervisors of each of the five counties ; and after such certification the board of supervisors of Oakland county adopted a resolution refusing to spread, approve or levy any tax for the purposes of the Authority for the ensuing year, such action being taken on the ground that the Oakland county board of supervisors had been advised that Act No. 147, Pub. Acts 1939, was unconstitutional. And it is alleged in the petition that, notwithstanding they have been- in session, the boards of supervisors of Wayne and Macomb counties have failed to take any action in response to the certification served upon them by the Authority; and that at the time the petition herein was filed the boards of supervisors of Washtenaw and Livingston counties had not yet convened in the 1941 fall session.
On filing of plaintiff’s petition an order to show cause issued, and the several respondents have made answer and return thereto, The officials of Washtenaw and Livingston counties concede the constitutionality of Act No. 147. Mandamus is sought to compel such action on the part of defendants as is necessary to secure the levy and collection of the tax for the use of the Authority. But, as hereinbefore indicated, some of respondents deny plaintiff’s right to the relief sought mainly on the ground that Act No. 147, Pub. Acts 1939, is unconstitutional. This presents the principal issue.
Subject only to limitations and restrictions imposed by the State or Federal Constitutions, the State legislature is the repository of all legislative power. Constitutional provisions are to be regarded as limitations, not grants of such power. Doyle v. Election Commission, 261 Mich. 546.
“In passing upon the constitutionality of State legislation, it is necessary to point out in the Constitution of the State the limitation which has been placed by the people through the Constitution upon the power of the legislature to the act, before it may be declared unconstitutional.” In re Brewster Street Housing Site, 291 Mich. 313, 333.
“The legislative authority of the State can do anything which it is not prohibited from doing by the people through the Constitution of the State or of the United States.” Attorney General, ex rel. O’Hara, v. Montgomery, 275 Mich. 504, 538.
We are not in accord with respondents’ contention that Act No. 147, Pub. Acts 1939, is violative of the State Constitution (1908), art. 5, § 30, which provides that the legislature shall not pass a local or special act “where a general act can be made applicable, and whether a general act can be made applicable shall be a judicial question. ’ ’ This Court might well take judicial notice that there are conditions prevalent in the designated metropolitan area which create a pressing demand for the accomplishment of the purposes of this act, and that these conditions do not prevail in any other section of the State and in all seeming probability never will. But aside from judicial notice of such conditions, there is sufficient alleged in the petition filed herein which is not traversed to justify the conclusion that conditions exist in the designated metropolitan area, and not elsewhere in the State, which afford ample justification for local legislation. While not conclusive; the fact that in its context the legislature designated the enactment as a “local act” is a circumstance which the Court may well consider in reaching its judicial conclusion. Washoe County Water Conservation District v. Beemer, 56 Nev. 104 (45 Pac. [2d] 779).
“We think it not a. strained construction to say that, if the legislature was in doubt as to whether a given law would come under the head of general legislation or would be special, if in the act itself there was a referendum to the electors of the district to be affected, it would be valid legislation when approved by the electors.” Common Council of Detroit v. Engel, 202 Mich. 544, 552.
Nor do we think the act contravenes article 8, § 26, of. the Constitution which provides that ‘ ‘ The Legislature may by general law provide for the laying out, construction, improvement and maintenance of highways, bridges and culverts by the State and by the counties and townships thereof and by road districts; and may authorize counties or districts to take charge and control of any highway within their limits for such purposes.” Act No. 147 now under consideration clearly was adopted by the legislature to provide a body corporate with prescribed authority to act in a limited field and to accomplish purposes entirely distinct from the construction or maintenance of ordinary highways.
As local legislation Act No. 147, Pnb. Acts 1939, was properly submitted for approval “by a majority of the electors voting thereon in the district to be affected.” Constitution (1908), art. 5, §30. Such submission to the electors did not violate article 3, § 4, of the Constitution as amended November, 1932, which provides:
“"Whenever any question is submitted to a vote of the electors which involves the direct expenditure of public money or the issue of bonds, only such persons having the qualifications of electors who have property assessed for taxes in any part of the district or territory to be affected by the result of such election or the lawful husbands or wives of such persons shall be entitled to vote thereon.”
The general and primary purpose of Act No. 147 is not to’provide for “the direct expenditure of public money or the issue of bonds;” but instead the fundamental purpose of the act is obviously to create a governmental agency empowered to function in a comparatively limited capacity in the accomplishment of Certain things which the legislature deemed essential to or at least promotive of public welfare. In a general way it may be said that no agency can operate for the public benefit except there is an incidental expenditure of public money; but it would be far-fetched to conclude that because of this circumstance no public agency to function locally could be created except with the approval of property-owning electors. And it may be noted that the power to issue bonds by the Authority is limited to “self-liquidating bonds in accordance with the provisions of act number 94 of the public acts of 1933, as amended. Such bonds shall not impose any liability upon the district.” See Act No. 147, § 8, Pub. Acts 1939. The issuance of such bonds is not within the provisions of Constitution (1908), art. 3, §4, above quoted. See Attorney General’s Opinion No. 17652, October 9, 1940; and Michigan Gas & Electric Co. v. City of Dowagiac, 278 Mich. 522. We quote from the cited opinion of the Attorney General relative to this phase of Act No. 147, Pub. Acts 1939:
“What constitutes a ‘direct expenditure of public money’ has never been given a general all-inclusive definition by the courts. It is to be noted that under section 7 of the special act, the commissioners ‘may’ levy. It may be possible that the Authority may limit its acquisition of property to revenue-producing recreational facilities in .which event self-liquidating bonds would be in order rather than tax assessment on the property of the district.
“We are oí the opinion that the special act (more particularly section 7 thereof) calls for -a permissive and an indirect expenditure of public money rather than a direct expenditure. To hold otherwise would compel, by analogy, submission of charter amendments of a city providing for pension funds for employees or for increase of salaries, et cetera, to taxpaying voters only. This department has consistently held otherwise on the lat'.er propositions without successful challenge. See Attorney General’s Opinion No. 12454 and Attorney General’s Opinion No. 17165.”
While not directly in point, our decision in Dearborn Twp. School District No. 7 v. Cahow, 289 Mich. 643, is in accord with the foregoing. In that case we held that on the question of whether the district should issue .certain bonds only property-owning electors could vote as provided in Constitution (1908), art. 3, § 4; but we also held that on the question of whether the rate of taxation in the school district should be increased nonproperty-owning electors were qualified to vote, i. e., those having the qualifications specified in the Constitution (1908), art. 3, §1. Respondents’ contention that Act No. 147, Pub. Acts 1939, is not in effect because it has not been ratified by the property-owning electors of the metropolitan district cannot be sustained.
Nor are we in accord with respondents’ contention that the April, 1927 amendment to the Constitution found in art. 8, § 31, by necessary implication excludes the power of the legislature to form such a metropolitan district as is created by Act No. 147, Pub. Acts 1939. Section 31 of article 8 in part reads:
“The legislature shall by general law provide for the incorporation by any two or more cities, villages or townships, or any combination or parts of same, of metropolitan districts comprising territory within their limits, for the purpose of acquiring, owning and operating either within or without their limits as may be prescribed by law, parks or public utilities for supplying sewage disposal, drainage, water, light, power or transportation, or any combination thereof.”
If it had been intended by the above-quoted amendment to restrict the power of the legislature to the establishment of metropolitan districts to the municipalities specified or to the purposes specified in the amendment, it seems highly probable that such a limitation would have been expressly embodied in the amendment. This was not done. Nor do we 'think any restriction or limitation of that character can be implied in the 1927 amendment. On this phase of the case we quote approvingly the following from plaintiff’s brief:
‘ ‘ The amendment has no relation to county activities. The purposes of the metropolitan districts covered by it are peculiarly pertinent to cities and villages, and, in small measure, even to townships, but their joinder, of course, would be necessary to provide terrain for a district. The purposes of the permitted metropolitan districts are not within the purview of county government and have no relation thereto, except in the remote sense that counties establish parks and county officers lay out drains. So, the amendment can carry no implication against the power of the legislature to establish county districts, as it is unrelated to the amendment.
‘ ‘ Certainly, a constitutional command, by amendment, to the legislature to provide a specific kind of law, for certain named municipalities, for certain named purposes, cannot be considered a limitation upon the inherent sovereign power of the legislature to provide for the exercise by other municipalities of a different kind of different powers for different purposes.”
In Williams v. Mayor of Detroit, 2 Mich. 560, it was said:
“It was strongly urged by the counsel for the complainant, on the argument of this cause, that the special enumeration of powers in article 14 of the Constitution (1850), entitled ‘Finance and Taxation,’ exclude all others that might be implied, and that the maxims of the law, expressio unins est ex-clusio alterius, and expressum facit cessare taciturn, are strictly applicable in the construction of the Constitution with regard to the powers of the legislature over the subject of taxation. That * * * there are some instruments or laws to which such maxims cannot be strictly applied, without doing manifest violence to the plain intent of the framers of the law, is * * * a matter of common experience.
“This is especially true in the construction of State Constitutions.”
Numerous decisions in accord with the foregoing might be cited from other jurisdictions. Among them are the following, McGrew v. Missouri P. R. Co., 230 Mo: 496, 526, 527 (132 S. W. 1076, 1084, 1085); State, ex rel. Moodie, v. Bryan, 50 Fla. 293, 377 (39 South. 929, 956); Paine v. Port of Seattle, 70 Wash. 294 (126 Pac. 628, 127 Pac. 580).
In deciding a case in this same field of the law, the supreme court of Illinois said:
‘ ‘ The clause in the ninth article, on which so much stress is laid, that the legislature may vest the corporate authorities of counties, cities, et cetera, with the power to assess and collect taxes, does not confine the legislature to any particular corporate authorities, or to any then known instrumentalities of that character. That instrument was made for all time, with full knowledge that the public necessities might require the creation of various and dissimilar corporate authorities, and to he imbued with administrative functions of a nature which could not he properly exercised by any known and existing corporate authority.” People, ex rel. Wilson, v. Salomon, 51 Ill. 37, 50.
There is no merit to the contention made by some of the respondents that Act No. 147, Pub. Acts 1939, effects a surrender of the power of taxation and is therefore in conflict with the Constitution (1908), art. 10, § 9, which provides:
“The power of taxation shall never he surrendered or suspended by any grant or contract to which the State or any municipal corporation shall be a party.”
As hereinbefore stated in substance, this Authority is clearly a State agency which functions in a limited way in a fixed local territory. The State has not ‘ ‘ surrendered or suspended by any grant or contract” to the Authority the power of taxation; but instead the legislature has delegated to it as a governmental agency the power to determine within a fixed limitation the tax that the local tax officers shall levy and collect for its use. As will be herein after noted, by statute (Act No. 62, § 11, Pub. Acts 1933, as amended [Comp. Laws Supp. 1940, § 3551-31, Stat. Ann. 1941 Cum. Supp. § 7.71]) like power to share within a specified limit in taxes levied and collected has been delegated to school districts and to other municipal units. But this is not a surrender or suspension “by grant or contract” of the power of taxation prohibited by article 10, § 9, of the Constitution (1908). Instead, the legislature by so providing has exercised its inherent power to allocate a given portion of tax moneys to governmental units for their uses.
In reaching decision we have not overlooked the claims of some of the respondents that dire consequences will result if the validity of the act in question is sustained. For example, the brief of the Wayne county respondents contains the following:
“With 46 school districts short of necessary funds, a much needed $3,000,000 building program at Eloise practically eliminated, and a prospective deficit of $400,000 in the funds required for the care of sufferers from tuberculosis, the constitutional 15-mill limitation will not permit further appropriation.”
The advisability or wisdom of statutory enactments which are not violative of constitutional provisions is a matter for legislative consideration, but not for the courts. Even if well-founded, assertions of the character noted do not afford grounds for holding the act unconstitutional.
In the brief of Wayne county defendants it is urged that Act No. 147, Pub. Acts 1939, violates article 12, § 1, of the Constitution (1908), which in part reads:
“Corporations may be formed under general laws, but shall not be created, nor shall any rights, privi leges or franchises be conferred upon them, by special act of the legislature.”
These defendants point out that the act here involved is a local or special act, that it designates this “metropolitan district as a body corporate,” and confers upon it certain powers commonly exercised by corporations. We are of the opinion that careful, rather than superficial, consideration of the act discloses that the contention made cannot be sustained. As we have hereinbefore repeatedly noted, this Authority is merely a governmental agency created for the execution of a specified and restricted purpose in which the local governmental units are concerned. In a true sense it is neither a private corporation nor a municipal corporation; but instead is of that class of artificial entities which has been designated quasi corporations.
The provision in the 1850 Constitution corresponding to that last above quoted prohibited the creation of corporations by special act “ except for municipal purposes.” Constitution 1850, art. 15, § 1. The quoted phrase was omitted from the corresponding section of the Constitution of 1908. From this the conclusion would seem inevitable that under the present Constitution the legislature does not have the power by special act to create either private or municipal corporations. But the purpose of this constitutional modification, so far as applied to municipal corporations, was to produce uniformity in the manner of organization or incorporation. It was not intended, as we view the constitutional provision, to strip the legislature of the power to create specific and supplemental governmental agencies designed to function in a limited sphere in the accomplishment of public purposes for which existing municipal, corporations either singly or in designated groups were not suited. Such agencies do not arise to the dignity of municipal corporations. They are lacking in very many of the powers which are commonly and necessarily characteristic of such corporations. They more closely resemble boards or commissions. In this connection we are mindful of the contention of these defendants that agencies of this character are created for “municipal purposes,” and therefore, it is asserted, they are within the prohibition of the constitutional provision; but for reasons herein-before noted and which will be hereinafter amplified we think such a construction does not carry out and is not in accord with the purpose and intent of the constitutional provision as now contained in article 12, § 1. Possibly confusion arises from the fact that municipal corporations in the proper sense are created for “municipal purposes,” and governmental agencies of the character under consideration are also created for a governmental purpose or purposes. The quoted expression must be construed to mean that which will carry out the purpose of the context in which it is used.
In speaking of a legislatively created board of fire commissioners as a body corporate, Justice Campbell in O’Leary v. Board of Fire & Water Com’rs, 79 Mich. 281, 284 (7 L. R. A. 170, 19 Am. St. Rep. 169), said:
“While it is a local corporation, created to serve municipal purposes, it is in no sense a municipal corporation, within the legal meaning of that term. It has been settled in this State that there can be no municipal corporation that is not the direct representative of the people of its locality. (Citing several Michigan decisions.) In several of these as in other cases the doctrine has been recognized that the establishment of corporations to act as municipal boards or agencies did not give them any governmental municipal authority.”
We are in accord with the conclusion reached touching the same constitutional question in the case of Beach v. Leahy, 11 Kan. 23. The court there had before it the validity of a local or special act which authorized a school district to issue bonds. The act was challenged under a like constitutional provision. In part the court’s opinion reads (pp. 29, 31):
“Giving corporate capacity to certain agencies in the administration of civil government is not the creation of such an organization as was sought to be protected (prohibited [see Carson v. St. Francis Levee Dist., 59 Ark. 513 (27 S. W. 590, 594)]) by article 12 of the Constitution. This distinction between quasi corporations and corporations proper, is no new thing nor of recent recognition. * * *
“The mere fact that these organizations are declared in the statute to be bodies corporate, has little weight. We look behind the name to the thing named. Its character, its relations, and its functions determine its position, and not the mere title under which it passes. In the last five cases cited the organizations were declared in the statute creating them to be bodies corporate, yet this made no difference in the rule. The conclusion to which these investigations have led us is, that among public corporations only corporations proper are included within the scope of article 12 of the State Constitution, and that a school district is only a quasi corporation, and not covered by its provisions.”
In Carson v. St. Francis Levee District, 59 Ark. 513, 533-535 (27 S. W. 590), the court in its prevailing opinion said:
“In fact, we are inclined to think that, under the latest and best rule of construction, acts of the legislature conferring corporate powers upon mere State agencies — bodies of citizens who have no personal or private interests to be subserved, but are simply required by the State to do some public work — are not acts conferring corporate powers, such as are referred to in the Constitution [the provision of which is similar to that in the Michigan Constitution] . * * *
“The object of the restriction was, evidently, the apprehended abuse of the power conferred. This was the reason of the constitutional restriction. The reason does not exist where the State merely clothes one of its own agencies or instrumentalities with such power. * * *
‘ ‘ The principles announced in these decisions (cited by the court), and the numerous authorities cited therein for their support, meet our views on the subject; and the main doctrine therein announced, to the effect that conferring corporate powers by the legislature upon agencies of the State, appointed to perform some public work, in the course of the administration of civil government, in order to the more efficient performance of the duties imposed, is not such an act as is prohibited by the Constitution, we think, is founded upon sound reason as well as authority.”
Farrell v. Port of Columbia, 50 Ore. 169 (91 Pac. 546, 93 Pac. 254), cited in defendants’ brief, may seem of a contrary holding, but that decision is clearly distinguishable in that the corporation there involved and which was created by a special act was designed and authorized to function in the field of private enterprise, doing business commonly done by transportation companies. It was not merely a governmental agency. In accord with the above-quoted cases and authorities therein cited, we hold that the legislative creation of this Authority was not within the prohibition of article 12, § 1, of the Constitution (1908).
We have given consideration to other claims of counsel asserted in support of the contention that Act No. 147, Pub. Acts 1939, is unconstitutional, hut we are of the mind that as against any of the reasons or grounds asserted the act is constitutional.
Having concluded that Act No. 147, Puh. Acts 1939, is constitutional, the remaining question presented is this: Is the tax to be levied under the act a part of the county tax of the several counties, requiring no separate tax allocation to the Authority; or is it a separate tax of the Authority to he allocated to it as a separate taxing unit? It may be noted that this question is properly raised in this mandamus proceeding because its decision hears materially upon the character and extent of relief to which plaintiff is entitled.
We think that a fair and reasonable construction of Act No. 147 as a whole and with particular regard to the provisions in section 7 removes all doubt as to the intent of the legislature and clears away the asserted ambiguities which some of respondents claim render the act incomplete and unworkable. The act does not create a separate and independent tax unit to which its portion of our millage tax must be apportioned by the tax allocation boards of the respective counties. Instead, in the exercise of its constitutional powers, the legislature has created the Authority as a public agency for specified purposes and vested it with a right to have and use for such purposes a portion of the county tax of each of the five counties, such portion not to exceed 14 of one mill levied against the counties’ assessable property. To that extent the legislature has “allocated” tax moneys to the Authority. Within that limitation upon proper certification to the respective counties the Authority is entitled to such portion of the county tax as it determines is required for its pur poses during the ensuing year. There is no need and no provision for action by allocation boards or boards of supervisors in order that the Authority may be entitled to receive and use the above-indicated portion of the county tax. The act of the legislature is controlling, just as the legislative act is final and controlling wherein it is provided that of our 15-mill tax rate a minimum of 3 mills belongs to the counties, 4 mills to the school district, and one mill to the townships, subject to certain conditions not here material. Act No. 62, § 11, Pub. Acts 1933, as amended. To hold otherwise than above indicated would almost of necessity defeat the provision in Act No. 147, § 7, that the tax rate “shall be uniform in the district.” In the light of the provision just quoted, as well as other provisions contained in the act, it must he held that the hoards of supervisors in the counties comprising the metropolitan district have no discretionary power to determine the amount- of the county tax to which the Authority is entitled, if within the %-mill limitation. This is so because, to the extent determined and certified by the Authority to the hoards of supervisors, not to exceed the tax rate of % of one mill, the act of the legislature itself in effect pools the county tax of the counties comprising the metropolitan district and appropriates the use of such tax moneys to the purposes of the Authority;
In section 7 of the act it is provided: “The commissioners (of the Authority) may levy for the purposes of the authority a tax of not more than one-quarter mill.” When read in conjunction with the other provisions of the act and in the light of the manner in which the legislature obviously sought to accomplish the purposes of the act, the words “may levy” may well he and should be construed to mean “may determine” or “may designate.” We think it is clear that the legislature did not in a literal sense contemplate a “levy” of a tax by the commissioners. Instead, in the same section it is provided that after taking the action by which the amount of the tax is determined by thfe commissioners, they “shall thereupon certify to the board of supervisors of each county comprising the district the necessary tax rate to ’raise such amount. * * # All taxes shall be assessed, levied, collected and returned as county taxes under the general property tax law.” The quoted portion of section 7 clearly contemplates that taxes at the rate certified by the Authority shall be spread by the boards of supervisors of the respective counties comprising the metropolitan district upon the tax rolls and levied upon the counties ’ taxable property; and that the taxes so levied shall be collected and returned in the same'manner and by the same officials as county taxes under the general property tax law. In this manner all such taxes would come into the hands of the treasurers of the counties comprising the district, and such taxes should thereupon be transmitted by such treasurers to the Authority. This we think must fairly be construed to be the meaning of that portion of section 7 which reads:
“All moneys collected by any tax collecting officer from the tax levied under the provisions of this section shall be transmitted to the authority to be disbursed as provided in this act.”
If deemed necessary by plaintiff, upon application it may have issued out of this Court a writ of mandamus directed to the respondent boards of supervisors or any of them to take such action as, in accordance with our decision herein, is requisite to secure the spreading, levying and collection of that portion of the county tax to which the Authority is entitled for the accomplishment of its purposes ■during the ensuing year. But in this connection it may be noted that in the event the counties comprising the metropolitan district or any of them have already caused to be spread upon the rolls and to be levied for collection county taxes at the maximum rate obtainable, there would seem to be no necessity for further action against officials of such counties. Instead when the county tax has been collected and returned to the county treasurer of any of such counties, under our holding herein the Authority will be entitled for its uses to that portion of the collected county taxes that represents a collection at the rate of 1/20 of one mill on the county’s taxed property as equalized. Plaintiff’s alternative prayer for relief by way of mandamus against the defendant county allocation boards and defendant Edward H. Williams is denied. Since a purely public question is involved, no costs are awarded.
Chandler, C. J., and Boyles, Starr, Wiest, Butzel, Bushnell, and Sharpe, JJ., concurred.
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North, J.
This appeal involves the validity of a trust instrument which Benjamin Rose executed October 26, 1927, about a week prior to Ms marriage to plaintiff, Clara B. Rose. Benjamin Rose died testate September 16, 1933. Plaintiff renounced tbe provisions made for ber in Ms will, and elected to take under tbe statute. Incident to creating this trust Mr. Rose conveyed eight parcels of land to the predecessor of the Union Guardian Trust Company. The deeds were recorded within two days. He changed the beneficiaries named in the trust instrument by means of a supplemental agreement on August 13,1932, under which defendant Ethel Alice Rose, Ms daughter by a former marriage, was to receive the trust property outright as beneficiary at his death. By her bill of complaint plaintiff sought cancellation of the deeds through which Mr. Rose conveyed title in trust to the parcels of,real estate to the defendant trust company, and also cancellation of the two deeds by which the trust company after the death of Mr. Rose sought to convey title to defendant Ethel Alice Rose. The circuit judge decreed to plaintiff the relief sought. Defendant Ethel Alice Rose has appealed.
There are two grounds on wMch it is claimed these trust instruments should be held invalid: (1) That the trust was set up by Benjamin Rose shortly before his marriage to plaintiff in an effort fraudulently to deprive her of her dower rights; (2) That Benjamin Rose retained so many rights and such complete control in the transferred property that in law he remained seized of the fee during coverture.
The trial court found as a matter of fact that Benjamin Rose did not transfer the property to the trustee so as fraudulently to deprive plaintiff of her dower rights. The record shows that he provided for her liberally, transferring a large part of his property to her inter vivos by means of joint deeds and joint bank accounts. Noah v. Noah, 246 Mich. 324, 327, holds that conveyances of property immediately prior to marriage are not per se fraudulent in Michigan. We agree with the trial court that no fraud was shown by plaintiff in the instant case.
However, the trial court found as a matter of law that Benjamin Rose retained so large a measure of control over the trust res as to remain in legal effect the actual owner, with the trustee being his agent only. In reviewing this holding we must consider the provisions of the trust instruments.
The language of the trust instrument of October 26,1927, is sufficient to create a valid trust under 3 Comp. Laws 1929, § 12977 (Stat. Ann. §26.61). Full legal title was conveyed to the trustee. See Goodrich v. City National Bank & Trust Co., 270 Mich. 222. But the trial judge found that the following provisions in the trust negative this language and make it only an agency agreement: (a) that the trustee was to hold legal title in the property during settlor’s life for his benefit, and upon his request to convey all or any of the trust res to such parties as he might designate; (b) that he might elect to manage the property, as he did do; (c) that the trustee need not pay the taxes; (d) that the settlor might borrow money on the trust res. He also had power to direct the sale, investment and reinvestment of the trust property; to use and enjoy all trust property; to revoke the trust; and to change the beneficiaries, as he did by the supple-' mental trust agreement of August 13, 1932.
There is no Michigan case which. is fully in point. Each trust instrument usually is different from all others. However, the question of how far a settlor may go in retaining rights to the trust property and still set up an effective trust has been considered by this Court heretofore. Goodrich v. City National Bank & Trust Co., supra, held a trust good where a settlor reserved power to change beneficiaries, to amend the trust instrument, to revoke the trust in whole or in part, to withdraw all or part of the estate and to control investments. This case cites 73 A. L. R. 209, note, which is much in point, and 65 C. J. pp. 274, 275:
“The fact that the settlor, in creating the trust, makes certain reservations, does not in itself affect the validity of the declaration. Thus he may, in a proper case, reserve to himself a life income from the subject matter of the trust, or he may reserve the right to use or dispose of the corpus, or to supervise the trust property in the hands of the trustee, or to substitute a new trustee. The fact that there may be no portion of the trust property left for the beneficiaries to receive, by reason of the settlor’s exercise of his reserved right to use or dispose of it, does not render the declaration invalid. ’ ’
Trust instruments similar to the one in question have come up in other jurisdictions. See 1 Scott on Trusts, § 57.2, pp. 339-344, for a complete discussion. In Kelly v. Parker, 181 Ill. 49 (54 N. E. 615), a similar trust was upheld. 1 Scott, pp. 342, 343, discusses it:
“The owner of land executed a deed conveying the land to trustees upon trust to allow him to use, occupy, manage, control, improve, and lease the land in any manner and for any purposes he might desire, and to allow him to enjoy the rents and profits as if he were owner, with the further provision that he should have power during his life to mortgage, sell, and convey the land or any part of it and to dispose of the proceeds as he might dispose of the rents and profits. It was provided that upon Ms death the land was to be sold and the proceeds paid to specified beneficiaries. The settlor reserved power to revoke the trust by an instrument in writing. It was held that the trust was not testamentary and was valid although not executed as a will. The fact that the subject matter of the trust was land and that it was conveyed by a formal instrument in which the purposes of the trust were fully stated doubtless influenced the court in upholding the trust in spite of the extensive powers of control reserved by the settlor.”
This broad construction has been followed in Keck v. McKinstry, 206 Iowa, 1121 (221 N. W. 851); Talbot v. Talbot, 32 R. I. 72 (78 Atl. 535, Ann. Cas. 1912 C, 1221); Van Cott v. Prentice, 104 N. Y. 45 (10 N. E. 257). Other states are more strict: Union Trust Co. v. Hawkins, 121 Ohio St. 159 (167 N. E. 389, 73 A. L. R. 190); McEvoy v. Boston Five Cents Savings Bank, 201 Mass. 50 (87 N. E. 465); and Warsco v. Oshkosh Savings & Trust Co., 183 Wis. 156 (196 N. W. 829).
The argument against upholding the present trust, based on policy, is that the trustee is supposed to control the trust res, and if the settlor retains control, the purpose of the trust is defeated. On the other hand, as pointed out in the Goodrich Case, supra, it is argued title to the trust property passes to the trustee by virtue of the trust instrument, the beneficiaries take vested interests in the property, and the powers reserved to the trustor amount to conditions subsequent, upon the happening of which the vested interest would become divested. We adhere to our holding in the Goodrich Case.
There are two other arguments against upholding the present trust instrument; neither of which is persuasive. One is that it might allow evasion of taxes; however, the Goodrich Case, supra, points out that the government has ample power to conserve its taxing authority; trusts may have different private and public effect. The second objection is that such a trust may result in defrauding of creditors. But this type of property disposal, if resorted to for fraudulent purposes, may be held void under fraudulent conveyance acts, 3 Comp. Laws 1929, § 13392 et seq. (Stat. Ann. § 26.881 et seq.). As above noted, there was no fraud disclosed in 'the instant ease. All creditors will be paid and the wife was provided for liberally — in such a measure as negatives fraudulent intent. It was the settlor’s intent to set up a valid trust. He used sufficient language to do so. The fact that he reserved sundry rights under the instrument- did not render it void. He conveyed full legal title to the trustee and charged the trustee with important duties. It was to administer the trust unless the settlor undertook control, or if the settlor was declared insane; it was to pay the inheritance taxes levied at settlor’s death, and was to sell sufficient trust property to pay such taxes; it was to keep books of account; and it could employ counsel. The fact that the supplemental agreement of August 13, 1932, cut down nearly all of the trustee’s duties after settlor’s death does not wipe out the trust, for the trustee still had duties while settlor lived, and was to see that inheritance taxes were paid and funds were available for same after settlor’s death. In so holding we conform to our decision in Goodrich v. City National Bank & Trust Co., supra, and with the Illinois court in Kelly v. Parker, supra, which decisions are in accord with the prevailing rule applicable to this type of case. See 73 A. L. R. 209; 118 A. L. R. 481; 14 Michigan State Bar Journal, 427.
In view of onr conclusion above noted, tbe decree entered in tbe circuit court granting plaintiff the reliéf sought, on tbe theory that tbe trust was invalid, must be vacated; and a decree will be entered in this Court dismissing plaintiff’s bill of complaint. Appellant will have costs of both courts.
Chandler, C. J., and Boyles, Starr, Wiest, Butzel, Bushnell, and Sharpe, JJ., concurred. | [
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] |
Chandler, C. J.
Defendant, Twin Drilling Company, was under contract to drill an oil well for tbe Pure Oil Company in Arenac county. Plaintiff was employed by Pure Oil Company as a roustabout and had been so employed for a period of approximately two years prior to October 14,1940, tbe date be sustained an accidental injury for which be seeks compensation herein.
Oil was struck by tbe drillers between 1 and 1:30 o’clock, a.m., Monday, October 14, 1940. About that time, an employee of defendant came to tbe bouse where plaintiff roomed to get another employee of tbe Twin Drilling Company and take him to tbe well. During tbe conversation, plaintiff learned that oil had been found and shortly thereafter drove in his own car to the scene .of operations. Upon arrival, he found some employees of defendant engaged in attempting to unload a portable derrick from a trailer by means of a gin pole and winch attached to the rear of a truck. The derrick, however, was so heavy that upon attempting to lift it from the trailer, the front of the truck to which the gin pole was attached would raise into the air. A plank had been placed across the front bumper of the truck and two of defendant’s regular employees were standing thereon but their weight was not sufficient to keep the truck on the ground. Plaintiff claims that defendant’s foreman, Mr. Rush, requested him to give assistance by standing on the plank, which he did. After standing there for a few minutes, one of the other men jumped off, whereupon the front of the truck again raised in the air and plaintiff was thrown to the ground, with resulting injury.
The department of labor and industry found that defendant’s foreman requested plaintiff’s assistance in standing on the front of the truck and that he thereupon became an employee of the Twin Drilling Company. An award of compensation was accordingly entered and this appeal in the nature of certiorari followed.
To entitle plaintiff to compensation, he must have been in the employ of defendant at the time of the accident, under a contract of hire, express or implied. 2 Comp. Laws 1929, § 8413, as amended by Act No. 204, Pub. Acts 1937, and Act No. 107, Pub. Acts 1939 (Comp. Laws Supp. 1940, § 8413, Stat. Ann. 1941 Cum. Supp. § 17.147). It is fundamental in this type of proceeding that before plaintiff can recover, the relationship of employer and employee must be admitted or proved. Lynch v. R. D. Baker Construction Co., 297 Mich. 1.
The facts as found by the department of labor and industry, although supported by the record and therefore not subject to inquiry by us, do not sustain the legal conclusion that the required relationship existed. Plaintiff had never worked for Twin Drilling Company. He was requested by no one to be present on the occasion in question, but, according to his own testimony, came to the site of the well because of curiosity. He happened to be present and responded to a casual request for assistance for the moment. To sustain the award would make every person rendering momentary requested assistance to another an employee and lead to all manner of absurdities. On the issue of the existence of the employer-employee relationship, the case is fundamentally indistinguishable from Smedley v. Mashek Chemical & Iron Co., 189 Mich. 64. Plaintiff was a volunteer.
The award is reversed, with costs to defendants.
Boyles, North, Starr, Butzel, Bushnell, and Sharpe, JJ., concurred. Wiest, J., did’ not sit. | [
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] |
Boyles, J.
Plaintiffs are the three children and heirs-at-law of one Salde Richardson, deceased. The bill of complaint is filed to set aside a conveyance of real property on the grounds of mental incompetence of the grantor (plaintiffs’ decedent), and undue influence, fraud, and deceit of the defendant in securing the same. The circuit judge set aside the conveyance, and the defendant grantee appeals.
Sam Richardson and wife, Salde Richardson, were owners of an 80-acre farm homestead in St. Clair county as tenants by the entirety. Mr. Richardson died January 15, 1940, at an advanced age. Mrs. Richardson, then past 60 years of age, continued to live on the farm. About nine months (October 8, 1940) after her husband’s death, Mrs. Richardson is alleged to have executed a warranty deed of the farm property to the defendant Beatrice T. Ball. Mrs. Richardson died in Florida, January 1, 1941, while on a pleasure trip. Defendant caused the deed to be recorded on January 6, 1941; plaintiffs first learned of this deed on January 13th, and filed a bill of complaint to set it aside on January 28th.
During the last year of her life, Mrs. Richardson suffered from diabetes and arteriosclerosis. Although insulin treatment was prescribed by a physician, she was not a cooperative patient, refused to continue the treatment or the diet prescribed for her, and her condition gradually grew worse. Her memory became bad, she misinterpreted things said to her, became childish at times, refused to listen to her children’s suggestions and advice, and often talked about dying. The physician who treated her testified that she was as much of a mental case as she was a diabetic, that the deterioration of the mental faculties was very marked in her case, and that because of her condition she would be a person who would be very easily led to do things.
Defendant became acquainted with Sam and Sakie Richardson in 1935 while operating a beauty shop in Brown City; her husband had a poolroom in the same town. After Mr. Ball died in 1936, defendant married one Frank Richardson, then nearly 70 years of age, a brother of Sam Richardson. Eight months later defendant divorced Frank, obtaining $3,500 in a property settlement. Defendant’s friendship with Sam and Sakie Richardson was not resumed until December, 1939, at which time defendant called at their farm home during the last illness of Mr. Richardson. After his death, Mrs. Richardson and the defendant were frequently together! The defendant, whose home was in Flint, became a frequent caller at the farm home. Often she came in the company of a physician friend who sometimes arrived at the farm in an intoxicated condition. They brought intoxicating liquor to the farm and there were some drinking parties there to which Mrs. Richardson’s children and friends strenuously objected. Due to her condition, a half glass of beer would incapacitate Mrs. Richardson. Her friends and neighbors, as well as her children, admonished Mrs. Richardson against her growing friendship with the defendant, and Mrs. Richardson at one time forbade the defendant bringing her doctor friend to the farm home again. However, he shortly thereafter again appeared with the defendant and was allowed to come in. The drinking parties continued. Part of the time Mrs. Richardson was ill in bed, although she continued to go about frequently in company with the defendant. Mrs. Richardson had a driver’s license and often drove her own car.
Early in the year 1940 the defendant began discussing with Mrs. Richardson about selling the farm. Late in the afternoon of October 8,1940, the defendant and Mrs. Richardson went to the office of an attorney in Port Huron and the warranty deed in question was there signed, witnessed, acknowledged, and delivered to the defendant. Plaintiffs claim that Mrs. Richardson was told she was witnessing a paper for the defendant, had no intention of deeding the farm and did not so understand the transaction.
Defendant claims the circumstances were as follows : That after Sam’s death, defendant approached Salde about selling the farm, that there were several discussions about the subject and on September 17th Mrs. Richardson asked defendant $3,500 for the farm, that defendant made an offer of $3,000 which Mrs. Richardson accepted. The defendant, called by plaintiffs for cross-examination under the statute, testified that on October 8, 1940, they went to the First National bank in Port Huron, that she got a draft or check for $1,920 and interest, that they went to Mr. Guerra’s office where the deed was executed. She testified:
“A.' * * * I paid her for the deed then and there in Mr. Guerra’s office. I paid her in currency, in cash.
“Q. Right across the desk?
“A. In the chairs at the desk.
“Q. Mr. Guerra was there?
“A. Pie was- present, yes.
“Q. You counted out, how much did you give her?
“A. $1,950.
“Q. In Mr. Guerra’s office on the 8th day of October ?
“A. Yes.
“Q. How were those bills and what kind of bills ?
“A. They were mixed bills.
“Q. Quite a wad of them?
“A. Yes, quite a stack of money.”
She admitted she had no one examine an abstract, told no one about the transaction until after Mrs. Richardson’s death; claimed that the balance of the purchase price ($3,000 less the $1,950 cash, referred to by her as $950) was paid by returning to Mrs. Richardson a note for $897 and interest, claimed to have been given her by the Richardsons; that it had been given for small loans made to them by her beginning in 1936. The balance of the difference ($100) was unexplained. The attorney, Mr. Guerra, is defendant’s counsel on this appeal. He was called by plaintiffs as their witness, and testified that he acted as witness and notary public in the execution of the warranty deed; professed to remember nothing more about the transaction except he did not recall that any money was paid over his desk in his presence as testified to by defendant.
Defendant’s testimony that she paid actual consideration for the conveyance is not corroborated by any other testimony in the record. The trial court analyzed the testimony at length and found that no consideration was paid by the defendant for the claimed conveyance. With that conclusion we are in accord. Defendant’s claim is disputed in every material detail by disinterested witnesses and refuted by the circumstances. It is not probable that the attorney who prepared the alleged conveyance and took the acknowledgment would not recall, in the space of less than a year afterward, that $1,950 had been paid in bills across his desk and a promissory note surrendered up, if it had occurred. There is evidence of contradictory statements made by defendant that she paid this money at a different time and a different place, and in a different man ner. Defendant’s money was invested in Flint property and her income as a beauty culturist was not such that she would be making unsecured loans amounting to $900, or carrying around with her cash to the amount of $1,950, as claimed by her. Her total income for a year was approximately $1,000. Testimony from the bank established that defendant did not get any draft or money from the bank as claimed. There was evidence that from 1936 until the death of Mrs. Richardson, neither Mrs. Richardson nor her husband had, or paid out, any such sum of money. While they kept a checking account, it was far more modest and the maximum balance was $350. They bought a car, paid for in instalments. They received an annuity check from insurance, used it to pay the balance on the car, but defendant makes no claim of asking for repayment of loans at any time. There was testimony that Mrs. Richardson valued 40 acres of the farm at $3,000, yet defendant claims Mrs. Richardson deeded her the entire 80 acres for that sum. The record supports the conclusion that the alleged deed was without actual consideration.
The circuit judge found that Mrs. Richardson was not mentally competent to execute the alleged conveyance and that the same was procured by undue influence. To say the least, it is doubtful if the record supports that conclusion.
Under the decisions of this court, what must be shown to establish mental incompetence or undue influence is well-settled law. Weakened mental condition due to diabetes, arteriosclerosis, or other physical incapacity does not establish mental incompetence. In December, 1940 — about two months after the transaction of October 8th — Mrs. Richardson went on a trip to Florida with a long-time friend, drove her own car for six days on the trip. The record is not convincing that Mrs. Richardson was mentally incompetent or that this warranty deed executed on October 8th was the result of undue influence on the part of defendant. Mere opportunity and desire does not sufficiently prove undue influence. However, under our view of the case, the question of mental incompetence or undue influence does not control the result.
The record sustains plaintiffs’ allegation that this conveyance was obtained by fraud and deceit. A number of witnesses testified that on many occasions both before and after October 8,1940, Mrs. Richardson told them she had no intention of selling the farm. One of her sons lived on an adjoining farm and worked her farm on shares after her» husband’s death. She frequently discussed business matters with him. In December, 1940, before she started on the trip to Florida, she discussed with him what to do with the farm. She said she wanted to avoid probating and the expense, that she realized the hazards of the trip to Florida, that she might not survive. On December 14, 1940, she made and executed a voluntary deed of conveyance of the farm to her three children, plaintiffs herein, placed the same in escrow to be delivered after her death. This deed was recorded after her death. A disinterested witness testified to what Mrs. Richardson said about the occurrence in Mr. Guerra’s office on October 8, 1940, as follows:
“A. Well, she said she didn’t know, she had been to Port Huron with Mrs. Ball and signed a paper as a witness and she didn’t tell me what it was. I asked her if she knew what she was signing and she said, no, Bee [Mrs. Ball] was a friend of hers and she signed it. * * *
“Q. Just give us the conversation as near as you can.
“A. Nothing, only she had been to Port Huron here and been to a lawyer’s office and signed this paper as a witness.
“Q. What else?
“A. Well, I don’t know, there isn’t anything else, she didn’t know what it was, she was terribly worried, she didn’t know what it was.
“Q. She said she had signed a paper as a witness?
“A. I said, don’t you read what you sign and she said, Bee was a friend of mine.
“Q. You asked her if she read everything?
“A. She said, no, she didn’t.
“Q. Bee was a friend of hers?
“A. That is what she told me.
“Q. This was the 25th of October?
“A. 27th, following Sunday:
“Q. Did any further conversation take place there with reference to Bee?
“A. The only time the sale of the farm was discussed was when Bee told me. Mrs. Richardson never said a word to me. On Friday the 25th, I asked Mrs. Richardson if she wanted to sell the farm, and she said no, that was the only home she had, and if she sold it what would she have.”
This disinterested witness testified without objection as follows:
“A. * * * I had a conversation with Mrs. Richardson on the 25th day of October at her home. I went there and found my mother and asked Mrs.. Richardson to come home with me. I can’t remember all of the conversation that happened that day. I had the conversation with Mrs. Richardson about the papers she signed on October 27th. She was at my home.
“Q. What happened?
“A. I told her Mrs. Ball wasn’t a friend of hers.
“Q. You told her Mrs. Ball wasn’t a friend of hers ?
“A. Yes.
“Q. On what did you base that?
“A. What Mrs. Ball told me the previous Sunday.
■‘Q. Go ahead with the conversation between you and Mrs. Richardson.
“A. She said she thought Mrs. Ball was a friend of hers and went down to Port Huron and signed a paper which she was very worried about. She signed this paper as a witness and didn’t know what it was and I asked her if she didn’t read it and she said, no.
“Q. What is the conversation had about that?
“A. I told her she was a fool.”
Another disinterested witness testified without objection:
“A. One thing she told me a few days she had been down there, she was down here with Bee, Mrs. Ball, and signed a paper for her and was worrying about it and Bee told her it was a deed.
"She didn’t say what she thought it was, thought it might be concerning the property over at Flint that Mrs. Ball bought. That was the next week after they were down there.”
On cross-examination by Mr. Guerra, this witness testified:
“Q. She told you before she went to Florida she had signed some papers for Mrs. Ball and she was afraid and she didn’t know what she had signed, is that right?
“A. Yes, sir:”
The wife of one of the plaintiffs, who visited with Mrs. Richardson and Mrs. Ball on October 8, 1940, the day the alleged deed was executed, testified as follows:
“I recall a visit Mrs. Ball and Mrs. Richardson paid me in my home in Port Huron on October 8, 1940. I kept a diary last year and put the date in my diary. They came to my home at about 4 o’clock in the afternoon. They didn’t say anything about going to a lawyer’s office. They talked about arranging papers in regard to Mrs. Ball’s purchase of the apartment building in Flint. Mrs. Ball was stating that she thought this apartment building was a good investment and I understood they had been to the bank to arrange the purchase of it. They were doing their business together as I understood it. Mrs. Richardson and she came together. Mrs. Ball was on business, but Mrs. Richardson was not. She didn’t discuss with me that day about signing any papers. About three days before, it was on Sunday, my husband and I were out there and Mrs. Richardson told me Mrs. Ball wanted her to witness some pap'ers for her, and she didn’t know what they were. This was about two days before this business on the 8th.”
On cross-examination, the same witness said:
“Q. * * * Will.you tell me what transpired on that day, what was the conversation, I am talking about the 8th of October, 1940?
“A. They just seemed to be rather interested about the investment that Mrs. Ball was about to make.
“Q. Who was interested, Mrs. Ball or Mrs. Richardson?
“A. Mrs. Ball mostly, because it was her investment.
“Q. She told you she was going to make this investment?
“A. Yes.”
Conceding that the burden of showing fraud is upon the person alleging it, and it is never presumed nor lightly inferred, fraud need not be shown by direct proof but may be proven by inference from facts and circumstances. Detroit Trust Co. v. Hartwick, 278 Mich. 139; Goldberg v. Goldberg, 295 Mich. 380. A wide latitude is allowed in the admission of testimony where the existence of fraud is an issue. Taylor v. Ward, 264 Mich. 118; Daugherty v. Park, 289 Mich. 561.
Appellant complains of errors in receiving testimony. The order in which testimony may be received in equity cases rests largely in the discretion of the court. There is no merit in the objection that the court received testimony concerning consideration or lack of it from defendant, called for cross-examination under the statute, at the beginning of taking testimony. Under our view of this case, testimony on the question of mental competence or undue influence does not- control the result. In re Balk’s Estate, 298 Mich. 303. We find no error in receiving testimony.
In McGinn v. Tobey, 62 Mich. 252 (4 Am. St. Rep. 848), bill was filed to set aside a deed and mortgage. Plaintiff entrusted some business to defendant and had implicit faith in his honesty and friendship. Defendant negotiated with plaintiff to lease plaintiff’s store, defendant to draw the papers. Plaintiff was given a copy, which was read to him and which he read and signed. Plaintiff then signed what he believed to be a counterpart of the copy that he had signed previously. This latter paper turned out to be a deed. In holding that the deed passed no title, this court said (p. 260):
“The signature to this instrument is genuine, but the body of the deed is false, and the signing of complainant’s name, without knowledge of such falsity, cannot cure it and make it a true and valid instrument in the hands of any one. A genuine signature cannot change the character of an instrument of this kind, unless the intent to do so goes with the signature.”
In Berry v. Whitney, 40 Mich. 65, 72, this court said:
“There is also an abundance of authority that fraudulent representations as to the legal operation and effect of an instrument will be sufficient to avoid the same when made to a party who is able to read, or who has actually read the instrument, but who is unable to judge of its true character and construction. To have this effect the fraud must be contemporaneous with its execution, and must consist in obtaining the assent of the party defrauded, by inducing a false impression as to its legal or literal nature and operation. 2 White & Tudor’s Equity Cases, part 1, 559-567 and cases cited. ’ ’
In Horvath v. National Mortgage Co., 238 Mich. 354 (56 A. L. R. 578), the facts were: Plaintiff and her husband were uneducated and ignorant of business. Defendant was an educated business man. Defendant persuaded plaintiff to let him manage her property, and she gave him a power of attorney. At the same time, defendant procured a warranty deed from plaintiff, which plaintiff claimed she did not sign, or, if her signature was genuine, it was procured by trickery. Later, defendant executed mortgages on the property. Plaintiff filed a bill to set aside the deed and mortgages. This court held:
“In view of this finding, the case before us is not one of so-called actual forgery, that is, where the signature to an instrument is simulated, but is one where a genuine signature is procured by fraud. Is the latter in law a forgery, and, if it is, does it operate to defeat the rights of subsequent bona fide holders? On this question there is much conflict in the authorities. In many jurisdictions it is held that the procuring of a genuine signature to a deed by fraud does not constitute forgery. Our court has taken a different view, as an examination of the following cases will show: Gibbs v. Linabury, 22 Mich. 479 (7 Am. Rep. 675); Anderson v. Walter, 34 Mich. 113; Crawford v. Hoeft, 58 Mich, 1; McGinn v. Tobey, 62 Mich. 252 (4 Am. St. Rep. 848); Beard v. Hill, 131 Mich. 246.”
The condition of Mrs. Richardson’s mind, weakened by disease, the apparent influence exercised over her by the defendant, the lack of probative valúe in defendant’s testimony, the fact that the alleged conveyance was without consideration, and the admissible testimony of disinterested witnesses as to all the circumstances, is convincing that Mrs. Richardson did not intentionally execute a deed for the purpose of conveying her farm to the defendant. It was induced by the fraud and deceit of the defendant. Equity has inherent jurisdiction under these circumstances and may decree a cancellation of the alleged conveyance. Gragg v. Maynard, 164 Mich; 535. Under the circumstances • of this case, equity will require a cancellation. Plaintiffs may take a decree in accordance herewith, with costs.
Chandler, C. J., and North, Starr, Butzel, Bushnell, and Sharhe, JJ., concurred. Wiest, J., did not sit.
See 3 Comp, Laws 1929, §14220 (Stat. Ann. §27.915).—Re-porter.
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Bushnell, J.
Plaintiff, the Fidelity & Casualty Company of New York, issued its “standard workmen’s compensation and employers’ liability policy” to defendant Henry Vantaggi. This contract of insurance was dated September 20, 1937, and expired a year later. On November 23,1937, one Ray Laska, then employed by Vantaggi, suffered an accidental injury which arose out of and in the course of his employment. On the same day Laska reported the injury to Vantaggi but Vantaggi failed to notify either the department of labor and industry or his insurer, plaintiff herein. On April 15, 1940, Laska filed a notice and application for adjustment of claim with the department and, on April 19th, plaintiff received a copy of this notice of claim from the department. Plaintiff, on May 17, 1940, orally and by registered letter, informed Yantaggi that, if it subsequently appeared that there had been breach of a provision of the contract of insurance regarding notice, it would look to him for indemnification and reimbursement of all payments which it might be required to make to Laska. Plaintiff also stated that, as provided in thei policy, it would appear and defend the compensation proceedings in Yantaggi’s behalf. A copy of plaintiff’s answer to Laska’s claim was inclosed with this letter.
That portion of the insurance contract which plaintiff referred to reads as follows:
£<F. This employer, upon the occurrence of an accident shall give immediate written notice thereof to the company with the fullest information obtainable. He shall give like notice with full particulars of any claim made on account of such accident. If, thereafter, any suit or other proceeding is instituted against this employer he shall immediately forward to the company every summons, notice or other process served upon him. Nothing elsewhere contained in this policy shall relieve this employer of his obligations to the company with respect to notice as herein imposed upon him.”
After hearing the claim, the deputy commissioner of the department made an award in favor of Laska. Defendant was informed by plaintiff in a second letter dated July 15,1940, that it intended to appeal from the deputy’s award to the department. A breach of the notice provision of the insurance contract was asserted and indemnification and reimbursement insisted upon in event of affirmance of the award by the department. In this letter plaintiff suggested that Vantaggi might desire to employ his own counsel and, it was stated, that he was thus, notified so that he might have ample time to do so. On review, the department held that Vantaggi had been notified of the accident and had failed to report the same to the department. The award of the deputy was modified and affirmed in an order entered October 7,1940.
Subsequently Laska petitioned the department to be allowed a lump-sum settlement so that he might purchase and operate a restaurant business in order to provide a living for himself and family, as is provided by statute, 2 Comp. Laws 1929, § 8438, as amended by Act No. 148, Pub. Acts 1935 (Comp. Laws Supp. 1940, § 8438, Stat. Ann. § 17.172). Plaintiff approved the “agreement and petition to redeem liability, ’ ’ and, on December 16,1940, an order was entered by the department providing for the payment of $1,600 to Laska as a lump-sum settlement for the remainder of the compensable period.
Prior to the lump-sum settlement, plaintiff had paid Laska the sum of $1,225.46 as accrued compensation. Plaintiff spent $521.36 for attorney fees, et cetera, in defending the claim and brought this action against Vantaggi for the recovery of its disbursements. Vantaggi denied in his answer that he had received any notice of Laska’s injury before the filing of the claim, but the holding of the department that Vantaggi had notice on November 23, 1937, is res judicata of this question. Lumbermen’s Mutual Casualty Co. v. Bissell, 220 Mich. 352 (28 A. L. R. 874). Vantaggi admitted that he did not notify plaintiff until the claim was filed on April 15, 1940.
At the trial, the letters above referred to and the records of the department of labor and industry were admitted in evidence. The depositions of three witnesses are mentioned but these are not included in the record on appeal. On motion of the defendant the trial judge directed a verdict in his favor on the theory “that as a matter of law the insurance company could not on an agreement signed by its attorney, although he used the name of Yantaggi in the agreement, make a settlement of Laska’s claim which would be binding upon Yantaggi. ’ ’ The court said:
“In other words, if Yantaggi was bound by that award against him, so was the insurance company. It was Yantaggi’s right as well as the right of the insurance company to have the weekly indemnity due Laska paid by the week. He didn’t know what might happen between time. He might die or might go bankrupt or there might be any number of reasons why he couldn’t be held as* time went on, and so when there is no evidence that Yantaggi expressly agreed or consented to this agreement and petition to redeem for a lump sum, I hold that it is not binding upon Yantaggi, and the plaintiff cannot recover for the amount it paid upon such an agreement.”
"When the trial judge’s attention was called to the sum of $1,225.46 plaintiff had paid as past compensation, he said that this matter would be disposed of when the motion for new trial was considered. In the opinion- denying plaintiff’s motion for new trial, the court held, “As the weekly payments made before the final payment were by the terms of the lump-sum agreement made a part of the agreement they fall with it.” The statute, 2 Comp. Laws 1929, § 8438, as amended by Act No. 148, Pub. Acts 1935 (Comp. Laws Supp. 1940, § 8438, Stat. Ann. § 17.172), provides that the department may at any time direct in any case, if special circumstances be found which in its judgment require the same, that the deferred payments be commuted on the present worth thereof. Plaintiff was, therefore, required by law to make the $1,600 lump-sum payment, McMullen v. Gavette Construction Co., 207 Mich. 586, and such payment does not bar its right of action againsVantaggi.
Plaintiff is a compensated insurer who had assumed and agreed to pay the debt of another without reimbursement. It does not occupy the same position as a noncompensated surety whose obligation is secondary, nor is it one who has no contractual obligation to pay but is caught in the web of circumstances through the fault of another. Maryland Casualty Co. v. H. A. Moss & Son, Inc., 276 Mich. 219, 230. The situation here is different from that-presented in Oakland Motor Co. v. Fidelity Co., 190 Mich. 74. Vantaggi’s failure to give notice of the accident as provided in his policy did not relieve plaintiff from liability to Laska. Fidelity & Casualty Co. of New York v. Schoolcraft County Road Commissioners, 267 Mich. 193, 198.
There was no agreement in the insurance policy whereby defendant promised to reimburse plaintiff, and recovery, if any, must be had on the theory of damages suffered by reason of the breach of the notice provision of the policy. The failure of an employer to give notice of an accident as provided for in his policy of insurance is such a substantial breach as to furnish a basis for recovery by the insurer. However, the insurer must show the extent and amount of the damages it has suffered by reason of this breach. In this case plaintiff has not waived its right of action, as was the situation in Standard Accident Ins. Co. v. Carlson, 271 Mich. 199. See, also, Wisconsin Michigan Power Co. v. General Casualty & Surety Co,, 252 Mich. 331 (76 A. L. R. 1).
The judgment entered upon the directed verdict is vacated and the cause remanded for a new trial in accordance with this opinion. Costs to appellant.
Chandler, C. J., and Boyles, North, Starr, Butzel, and Sharpe, JJ., concurred. Wiest, J., did not sit. | [
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Moore, J.
This is a proceeding to establish a lien for work done by the plaintiffs under a written contract to convert a cottage into a two-family flat, the contract price for which work was to be $300 when the roof was raised and boarded, $600 when the plumbing was roughed in and plastering done, and $610 when the job was completed. The bill of complaint asks for a decree for $628.36 interest and costs. The defendants claim the plaintiffs did not complete the contract and that it required an expenditure of more than $1,800 to complete what the plaintiffs had agreed but failed to do. The case was tried in open court, the judge rendered a decree in favor of the plaintiffs in the sum of $438.32 and interest. The case is brought here by appeal, defendants claiming a decree should have been rendered in their favor in the sum of $1,216.38.
The testimony was as conflicting as could be as is illustrated by the following quotations from the testimony. The plaintiff William J. Sturgis testified:
“The chimneys were run down into the ground and were built of brick.
“Q. How far did they go into the ground?
“A. About three feet six inches.
“Q. Did you see that done?
“A. Yes, sir. * * * The chimneys we built went down in the ground about three feet. There wasn’t any timbers in the chimney.”
Fred Benner, a witness for defendants who did the work on the building after plaintiffs claimed it was completed, testified:
“Part of the chimneys resting on the floors and the chimneys didn’t have any foundations to them, and the chimneys were 2x8 flues, were too heavy, and all the strength was right on the floor, that is, all the weight. I found upon examination a stringer built right into the chimney. The stringer is that part of the building where the joists rest and was on the first floor. . It was built right into the chimney and the foundation around it. I noticed the house was settling in the back where the chimney was coming down. * * *
“I had to tear down both chimneys.' There was no foundation under the chimneys! They were resting on the ground about six inches under the surface. There was a lot of water under the chimneys. They had to come down.”
There are some significant things disclosed by the record. The defendant George Sprenger lived near the building and passed it every morning going to his work. He made the first two payments as the contract required. There is nothing in his testimony to indicate that he made any complaint until he was asked to make the final payment. The following appears in his cross-examination:
“Q. The partitions in the rooms as they were when Mr. Benner started his work were laid out in accordance with these plans and specifications, were they not?
“A. Yes, those plans.
“Q. They were laid out in accordance with these plans and specifications?
“A. That is what Mr. Sturgis brought over to my place.
“Q. The work has been done according to them?
“A. I think so.
“Q. When he quit the job?
“A. I think so.
“Q. And you had accepted these plans and examined them before he went on the contract?
“A. I never examined them at all because I don’t know the first thing about plans.
“Q. Did you have them in your possession?
“A. I had them.
“Q. Do you mean to say you were spending this money, some two thousand dollars on the job and didn’t even look at them?
“A. I looked at them but I don’t know whether they were good or not. I left it entirely with Mr. Sturgis.
“Q. Well, they were to your satisfaction when you signed the contract?
“A. When I signed the contract I thought they were all right. * * *
“Q. And when Mr. Sturgis was through with the work you said you wanted a sworn statement.
“A. Because he told me he didn’t pay that much and I wanted a sworn statement.
“Q. You wanted a sworn statement when the work was done?
“A. Yes. .
“Q. And when you asked for that sworn statement and received this you were satisfied with it, the one jrou got? * * *
“A. He told me he had everything paid but the plumber and I wanted him to pay the plumber first.
“Q. That is the only discussion you had with Mr. Sturgis that time, that you wanted the plumber paid?
“A. Yes, sir.
“Q. And Mr. Sturgis at your request, through the instructions of your attorney, brought the original of this paper with the waiver of the lien of the plumber?
“A. Yes, sir.
“Q. That satisfied you and satisfied your attorney?
“A. Yes.
“Q. You refer to Mr. Riggs?
“A. Yes.
“Q. And you were satisfied?
“A. Yes, I wanted the plumber paid.
“Q. Well, you didn’t tell Mr. Sturgis this was for the completed job wasn’t it?
“A. I suppose so.
“Q. Well now you know, you are an intelligent man. This was for a completed job and when you got this paper you were satisfied?
“A. Not with the job I wasn’t satisfied.
“Q. Well, what did you point out to Mr. Sturgis at the time when he gave you this paper in your attorney’s office?
“A. I told him the interior finish and the outside painting and all that wasn’t in good shape.
“Q. You complained of the painting?
“A. Lots of other things, I don’t remember now, and he said he wouldn’t have anything to do with the building any more.
“Q. Well, you complained that the painting wasn’t done according to specifications?
“A. Yes, sir.
“Q. And that is all your contention?
“A. Oh, sure.
“Q. And the interior finish wasn’t right? That is all that you complained of?
“A. I can’t remember this any more.”
It is the claim of the plaintiffs that the job was substantially completed and that defendants agreed to pay them if they would bring a waiver of his lien from the plumber, and that they did so. It is useless to attempt to reconcile the testimony. It is too conflict ing for that. It is impossible to read the record, however, without reaching the conclusion that defendants instead of attempting to, in good faith, complete the contract made by the plaintiffs entered upon an entirely different construction for which plaintiffs should not be held liable. The trial judge made an allowance of nearly $200 for defects in the construction. He had the great advantage of hearing and seeing the witnesses. °
The pivotal questions are those of fact. We are not persuaded the decree is wrong.
It is affirmed with costs.
Ostrander, C. J., and Bird, Steere, Brooke, Fellows, Stone, and Kuhn, JJ., concurred. | [
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] |
Fellows, J.
About five o’clock in the morning, February 2, 1915, a car of defendant Detroit United Railway collided with a locomotive of defendant Detroit, Grand Haven & Milwaukee Railway Company on Forest avenue, in the city of Detroit. Plaintiff claims to have been a passenger in the street car and -to have been seriously injured. He brought this suit against both companies. The jury exonerated the Detroit, Grand Haven & Milwaukee Railway Company from liability, but rendered a verdict against the Detroit United Railway for the sum of $1,000. It is not claimed that this amount is excessive if the plaintiff is entitled to recover, or that the- defendant Detroit United Railway was not negligent. The sole meritorious question being that the verdict is against the great weight of the evidence.
At the time of the accident the plaintiff resided in the extreme western part of the city. He claims that on the morning of the accident he arose at an early hour, went to the extreme eastern part of the city to see a man with reference to renting a house and was returning home when the accident occurred. He produced two witnesses, fellow countrymen, who testify to assisting him on the occasion of the accident, and who claim to have taken him to a doctor’s residence. He also produced the doctor who corroborated his and their testimony on this point, and who also testifies to his injuries and the subsequent treatment, and his condition! Plaintiff and his fellow countrymen seem to have given their testimony through an interpreter and there are some apparent inconsistencies in their testimony. Defendant produced witnesses who contradicted the plaintiff on material points. The trial court who saw and heard the witnesses declined to grant a new trial.
We are not persuaded that the plaintiff’s testimony is so highly improbable as to justify us in concluding that it is without foundation in fact, or that it is so weakened by inconsistencies as to render it unworthy of belief. It is corroborated by that of his two fellow countrymen, and the physician who claims to have treated him, all of whom appear from this record to be entirely disinterested.
If the testimony of plaintiff and the witnesses produced by him was believed by the jury — and the jury had a right to believe it — plaintiff made a case. The trial court, upon a motion for a new trial on the grounds here urged, determines in the first instance the question, and this court, upon such question being properly saved and presented for review, determines whether error was committed by the trial court on such grounds. But in the determination of the question in this court it must be 'borne in mind that this court is not the trier of the facts. We cannot invade the province of the jury. It must also be kept in mind that the trial judge heard and saw the witnesses, was in a position to judge of their credibility and their mental capacity; that the presumption that he correctly measured them must be considered, and that we may not set aside a verdict unless it is manifestly against the clear weight of the evidence. Muir v. Kalamazoo Corset Co., 155 Mich. 624; Krouse v. Railway, 170 Mich. 438; Rice v. City of Pontiac, 173 Mich. 41; Bosek v. Railway, 175 Mich. 8; Druck v. Antrim Lime Co., 177 Mich. 364; Morrison v. Carpenter, 179 Mich. 207; Darling v. Railway Co., 184 Mich. 607; Gardiner v. Courtright, 165 Mich. 54, and authorities there cited.
We are impressed from a careful examinatioñ of this record that the verdict is not manifestly against the clear weight of the evidence. It would profit no one to extend this opinion by a detailed statement of the testimony of each witness.
The judgment is affirmed.
Ostrander, C. J., and Bird, Moore, Steere, Brooke, Stone, and Kuhn, JJ., concurred. | [
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Ostrander, C. J.
It will be seen from the statement of facts that the contract rested in parol, and that it was that plaintiff should lease to defendant and defendant should hire or rent from the plaintiff a piano at a monthly rate of rental, the date of payment of which is not specified. The operation of the contract began August 8, 1906. The period for which it is sought to recover rent ends May 8, 1911, 57 months at $2.50 a month. It seems that the plaintiff kept a memorandum on his book. It is not so stated in the statement of facts, but it is to be inferred that on the book he charged the defendant monthly, or at intervals, with the rent and gave him credit for whatever sums were paid for rent. On May 8, 1911, plaintiff charged the defendant $2.50 for rent for one month, and on the book the last item of credit is February 2, 1910, cash, $5. The suit was begun August 30, 1916. The total payments for rent from August 8, 1906, to May 8, 1911, were but $29.
It is said in appellant’s brief that the point in issue is whether the cash payment of $5, made February 2, 1910, rendered the account a mutual open account current. On the part of plaintiff it is said that the point may be stated as, Do the general cash payments made on the account, the last of which was $5, paid February 2, 1910, render the account a mutual open account current within the meaning of section 12324, 3 Comp. Laws 1915? The statute is: ■
“In actions brought to recover the balance due upon a mutual and open account current, the cause of action shall be deemed to have accrued at the time of the last item proved in such account.”
The learned trial judge was of the opinion that the point had been adjudicated and settled in Payne v. Walker, 26 Mich. 60. In that case, the action was for the recovery of fees for legal services rendered at various times from the year 1848 or 1849 to June, 1871, and payments were made upon the account in 1851, 1856, 1860, and 1871. The court held that the payments upon the account were sufficient to render it an open and mutual account so as to prevent the remedy thereon being barred by the statute of limitations. The distinction between the two cases would seem to be obvious. Of course, accounts may be mutual without being entered in a book, but suppose that instead of a parol contract for the use of the piano the contract had been in writing and as payments were made upon it they had been indorsed upon the contract. Would anybody suppose that there was an open mutual ac count current, What would be open? Suppose a lease is made of premises for a period of years and as payments of rent were made they were indorsed upon the lease. Could it be said that there was any mutual open account between the parties? Suppose money is loaned and as security a mortgage is taken. Each half year,, or each year, the interest becomes due according to the terms of the contract, and, as it is paid, it is indorsed on the mortgage. Probably, no one would suppose that there was an open mutual account current. What difference does it make if the plaintiff in this case, the landlord in the first case supposed, the mortgagee in the second supposed case, kept a book account of the transaction in which he entered an item of debit on each due date and an item of credit when any money was paid? Manifestly, when a lawyer or doctor renders professional services and receives pay from time to time, or when a merchant sells goods from time to time, for which from time to time he receives partial payments, or upon which he gives credit for the value of services rendered by the buyer or goods furnished by the buyer, an open account is made and is mutual.
I know of no decision of this court, and think there is none to be found in any jurisdiction, holding that where the dealings of the parties relate entirely to and are governed by a special contract for the payment of money, at agreed upon periods, an open mutual account is established by performance of the contract obligation, whether a book account of it is kept or not. The trial court was in error and, the defendant having pleaded the statute of limitations, judgment should have been directed in his favor for any part of plaintiff's demand which did not accrue six years before the action was begun.
The judgment is reversed and a new trial granted.
Steere, Brooke, Stone, and Kuhn, JJ., concurred with Ostrander, C. J. | [
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Hood, J.
Defendants Joseph Passeno and Bruce Michaels appeal as of right from their convictions of multiple offenses arising from the slayings of Glen and Wanda Tarr on the evening of November 9, 1989. The appeals were consolidated by the Court of Appeals. We affirm in part, reverse in part, and remand.
Passeno was originally charged with two counts of first-degree murder, MCL 750.316; MSA 28.548, two counts of felony murder, MCL 750.316; MSA 28.548, two counts of armed robbery, MCL 750.529; MSA 28.797, two counts of kidnapping, MCL 750.349; MSA 28.581, ten counts of possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2), and one count of breaking and entering, MCL 750.110; MSA 28.305. Immediately before trial, Passeno pleaded guilty with regard to each of the nonmurder offenses. Following trial, he was convicted of one count of second-degree murder and two counts of felony murder for the killing of Wanda Tarr and one count of first-degree murder and two counts of felony murder for the killing of Glen Tarr.
Michaels was originally charged with two counts of first-degree murder, four counts of felony murder, two counts of armed robbery, and eight counts of felony-firearm. Following trial, Michaels was convicted of all counts, as charged.
We will first consider defendants’ assertion that the constitutional prohibitions against double jeopardy have been violated by their convictions of more than one count of murder for each of the slayings. We conclude that appellate review of this issue is appropriate, despite defendants’ failure to raise it before the trial court, because a significant constitutional question is presented. People v Newcomb, 190 Mich App 424, 431; 476 NW2d 749 (1991).
Both the federal and state constitutions prohibit placing a person in jeopardy of criminal conviction or incarceration twice for the same offense. US Const, Am V; Const 1963, art 1, § 15. Because Michigan’s Double Jeopardy Clause is "substantially identical” to that found within the Fifth Amendment of the United States Constitution, People v Bush, 187 Mich App at 316, 322; 466 NW2d 736 (1991), we will consider whether defendants’ convictions violate their provisions simultaneously.
Multiple convictions and sentences for counts of both first-degree murder and felony murder arising from the death of a single individual violate the constitutional guarantees against double jeopardy. People v Zeitler, 183 Mich App 68, 71; 454 NW2d 192 (1990); People v Goree, 132 Mich App 693, 712; 349 NW2d 220 (1984). Where a defendant is convicted of both first-degree and felony murder for the slaying of a single individual, the majority of reported cases hold that the conviction of first-degree murder must be affirmed, and the conviction of felony murder vacated. See, e.g., People v Carl Johnson, 99 Mich App 547, 559-560; 297 NW2d 713 (1980). We believe that this is an appropriate remedy, given that first-degree murder requires proof of an element not required for felony murder. Accordingly, we affirm Passeno’s conviction of first-degree murder and vacate his convictions of felony murder for the killing of Glen Tarr and affirm Michaels’ convictions of first-degree murder and vacate his convictions of felony murder. The mandatory life sentences for those affirmed convictions are affirmed.
Similarly, because felony murder requires proof of an element not required for a conviction of second-degree murder, we conclude that convictions of both felony murder and second-degree murder for the killing of the same individual should result in the affirmance of the felony-murder conviction and vacation of the second-degree murder conviction. See People v Hall, 83 Mich App 632, 638; 269 NW2d 476 (1978) (affirming a conviction of first-degree murder and vacating a conviction of second-degree murder arising out of the killing of the same individual). Accordingly, we affirm one of Passeno’s convictions of felony murder and vacate the other conviction of felony murder and his conviction of second-degree murder for the killing of Wanda Tarr.
Our disposition of the issue regarding defendants’ convictions of more than one count of murder for the killing of a single individual requires that we also consider their remaining convictions. Conviction of both felony murder and the underlying, or predicate, felony also violates a defendant’s right against double jeopardy under the state constitution. People v Wilder, 411 Mich 328, 352; 308 NW2d 112 (1981); Bush, supra at 325-326; People v Lumsden, 168 Mich App 286, 300-301; 423 NW2d 645 (1988). See also People v Robideau, 419 Mich 458, 489, n 8; 355 NW2d 592 (1984). When a defendant erroneously is convicted of both felony murder and the underlying, or predicate, felony, the remedy is a vacation of the conviction and sentence for the underlying, or predicate, felony. Lumsden, supra at 301. Accordingly, we conclude that one of Passeno’s convictions of an underlying, or predicate, felony must be vacated. Of course, which conviction must be vacated is dependent upon which felony-murder conviction is affirmed. We remand this matter to the trial court for a determination regarding which conviction should be affirmed. The mandatory life sentence for that conviction will also be affirmed.
Finally, we consider defendants’ felony-firearm convictions. Conviction of felony-firearm requires that the prosecutor prove, beyond a reasonable doubt, that the defendant possessed or carried a firearm during the commission of any felony or attempted felony. Wayne Co Prosecutor v Recorder’s Court Judge, 406 Mich 374, 397-398; 280 NW2d 793 (1979), app dis 444 US 948 (1979). Accordingly, defendants properly can be convicted of only as many counts of felony-firearm as they have underlying felony convictions. We affirm four of Michaels’ convictions of felony-firearm (two for his two first-degree murder convictions and two for his two armed robbery convictions) and five of Passeno’s convictions of felony-firearm (one for his first-degree murder conviction, one for his felony-murder conviction, and three for whichever three underlying felony convictions are upheld), and vacate the remaining convictions of felony-firearm.
We now turn to the remaining issues presented by defendants on appeal.
Passeno argues that the trial court erred in denying his motion for a change of venue, given the tremendous amount of publicity that accompanied this matter. Passeno maintains that he could not receive a fair trial in Oakland County because of the "intense” news coverage given to the murders of the victims; the negative community response to the murders, which he characterizes as an "uproar”; and the trial court’s failure to allow the passage of time before the trial commenced. This Court reviews a trial court’s grant or denial of a motion for change of venue to determine if there has been an abuse of discretion, People v Harvey, 167 Mich App 734, 741; 423 NW2d 335 (1988), using the somewhat stricter standard observed in criminal cases. People v Charles O Williams, 386 Mich 565, 573; 194 NW2d 337 (1972).
We begin by noting that the trial court’s denial of Passeno’s motion before jury selection was not only proper, but is considered to be the preferable practice. Harvey, supra at 741; People v Collins, 43 Mich App 259, 262; 204 NW2d 290 (1972).
The existence of pretrial publicity, standing alone, does not necessitate a change of venue. People v Furman, 158 Mich App 302, 321; 404 NW2d 246 (1987); People v Haggart, 142 Mich App 330, 334; 370 NW2d 345 (1985). Rather, to be entitled to a change of venue, the defendant must show that there is either a pattern of strong community feeling against him and that the publicity is so extensive and inflammatory that jurors could not remain impartial when exposed to it, People v Wytcherly, 172 Mich. App 213, 220; 431 NW2d 463 (1988); People v Prast (On Rehearing), 114 Mich App 469, 477; 319 NW2d 627 (1982), or that the jury was actually prejudiced or the atmosphere surrounding the trial was such as would create a probability of prejudice. Wytcherly, supra at 220; People v Bloom, 15 Mich App 463, 468-469; 166 NW2d 691 (1969).
When a juror, although having formed an opinion from media coverage, swears that he is without prejudice and can try the case impartially according to the evidence, and the trial court is satisfied that the juror will do so, the juror is competent to try the case. Furman, supra at 321.
Our review of the record in this matter leads us to conclude, for a number of reasons, that the trial court did not abuse its discretion in denying defendant Passeno’s motion for a change of venue. Although defendant Passeno alleged the existence of wide pretrial publicity, he provided no summary or examples of the media reports. He also failed to show that there was a pattern of strong community feeling against him, sufficiently strong to render all potential jurors partial, or that the jury was actually prejudiced. The trial court, by its careful individual examination of each potential juror, determined what exposure to the media reports each had and questioned each regarding impartiality. Those who expressed a problem in setting aside their feelings because of the media coverage were promptly excused for cause. We also note that Passeno did not renew his motion after the jury panel had been selected.
Because we conclude that the jury that was ultimately impaneled was competent to hear the evidence, and that Passeno did not make either of the showings necessary to entitle him to a change of venue, we affirm the .trial court’s denial of Passeno’s motion.
We also reject Passeno’s assertion that the trial court erred in denying his motion for a directed verdict at the conclusion of the prosecutor’s case in chief. Essentially, Passeno argues that insufficient evidence of premeditation and deliberation was presented to enable the original charges of first-degree murder and felony murder to go to the jury.
We first note that premeditation and delibera tion do not have to be shown to support a conviction of felony murder. The only intent required is the malicious intent required for a conviction of second-degree murder: intent to kill, intent to do great bodily harm, or intent to create a very high risk of death or great bodily harm with the knowledge that death or harm will probably result. People v Flowers, 191 Mich App 169, 176; 477 NW2d 473 (1991).
To prove first-degree murder, the prosecutor must establish that the defendant’s intentional killing of another was deliberate and premeditated. People v Coddington, 188 Mich App 584, 599; 470 NW2d 478 (1991). Although the length of time needed to weigh a choice before it is made is incapable of a precise determination, there must be an interval during which a "second look” may be contemplated. Furman, supra at 308. A partial list of factors that may be considered by the trier of fact to determine if premeditation and deliberation are present includes: (1) the previous relationship between the victims and the defendant, (2) the defendant’s actions before and after the crime, and (3) the circumstances surrounding the killing itself, including the weapon used and the location of the wounds inflicted. Coddington, supra at 600.
The evidence presented during the prosecutor’s case in chief showed that the killings of both Wanda and Glenn Tarr were accomplished after they were taken from the comparative safety of their car and home, respectively, driven to an isolated park, walked down a path into the woods, and shot numerous times in the head from a distance of IV2 to 2 feet by two weapons. Taking this evidence in a light most favorable to the prosecution, as we are required to do, People v Petrella, 424 Mich 221, 268-270; 380 NW2d 11 (1985); People v Lino, 190 Mich App 715, 720-721; 476 NW2d 654 (1991), we conclude that there was more than sufficient evidence to enable a rational trier of fact to conclude that the killings were done with premeditation and deliberation. Accordingly, we find that the trial court did not err in denying Passeno’s motion for a directed verdict.
We also reject Passeno’s assertion that the admission in his trial of evidence of Michaels’ incriminating statements to another witness, absent a limiting instruction, requires reversal. Although it is true that evidence of incriminating statements of a codefendant, which interlock with the defendant’s confession, is admissible only when an appropriate limiting instruction is given, Parker v Randolph, 442 US 62; 99 S Ct 2132; 60 L Ed 2d 713 (1979); People v Jackson, 158 Mich App 544, 552-553; 405 NW2d 192 (1987), failure to give such an instruction does not always require reversal. "Where the evidence supplied through the confession is merely cumulative and other evidence of defendant’s guilt is overwhelming, the admission of a confession by a nontestifying codefendant is harmless beyond a reasonable doubt.” People v Hartford, 117 Mich App 413, 420; 324 NW2d 31 (1982). The record in this matter provides overwhelming evidence of Passeno’s guilt. We find that, although the trial court erred in admitting evidence of Michaels’ incriminating statements to another witness without a limiting instruction, any error that occurred was harmless. Reversal is not required.
Finally, both defendants challenge the sentences imposed by the trial court.
Passeno argues that the sentences imposed for his convictions of armed robbery and kidnapping constitute an abuse of discretion that should shock the conscience of the Court. Although we note that the appropriate standard is now whether the sen tence imposed was proportionate to the offender and the offense committed, People v Milbourn, 435 Mich 630, 636; 461 NW2d 1 (1990), we decline to address the sentences imposed for these convictions. Given our affirmance of Passeno’s convictions of first-degree murder for the killing of Glen Tarr and one count of felony murder for the killing of Wanda Tarr, and the mandatory terms of natural life imposed for those convictions, even if we concluded that the sentences were disproportionate, no relief would be afforded Passeno. People v Sharp, 192 Mich App 501, 506; 481 NW2d 773 (1992).
Michaels challenges the trial court’s decision to sentence him as an adult in accordance with MCL 769.1(3); MSA 28.1072(3). Michaels argues that the opinions of the experts presented by the prosecution at his sentencing hearing were influenced impermissibly by his multiple convictions, his perceived lack of remorse for the killings, and his perjury regarding the facts of the case. Michaels characterizes the experts’ recommendations as containing a "rather cynical implication” that if he had admitted guilt and showed remorse he would have been sentenced as a juvenile. Although he admits that the trial court sufficiently articulated the reasons for the sentences imposed, Michaels argues that the experts relied on improper sentencing considerations, his multiple convictions, and his lack of remorse in recommending adult placement and that the admission of their recommendations, along with the trial court’s reliance upon the expert’s recommendations, entitles him to a new sentencing hearing.
MCL 769.1(3); MSA 28.1072(3) requires that the court having jurisdiction over a minor offender, whether pursuant to MCL 764.1f; MSA 28.860(6) or not, conduct a hearing to determine "if the best interests of the juvenile and the public” would be better served by placing the minor in the custody of the juvenile offender system or by sentencing the minor as an adult. MCL 769.1(3); MSA 28.1072(3) provides a list of criteria to be considered by the court in making its determination, including the juvenile’s prior record, the seriousness and circumstances surrounding the offense, whether the offense is part of a pattern of similar offenses, whether the juvenile’s behavior is likely to render him dangerous if released at age twenty-one, whether rehabilitation of the juvenile is more likely to occur in the juvenile or adult system, and what is in the best interests of the public peace and welfare.
MCR 6.931 is the court rule governing the hearings mandated by MCL 769.1; MSA 28.1072. Under MCR 6.931(E)(2), the prosecutor has the burden of proving, by a preponderance of the evidence, that the best interests of the juvenile and the public would be served by sentencing the juvenile as an adult. Subsection E(4) requires that the trial court make findings of fact and conclusions of law.
We believe that the appropriate standard of appellate review of the trial court’s decision to sentence a minor as a juvenile or as an adult is a bifurcated one. First, the trial court’s findings of fact supporting its determination regarding each of the factors enumerated in MCL 769.1(3); MSA 28.1072(3) should be reviewed under the "clearly erroneous” standard of MCR 2.613(C). The trial court’s findings are clearly erroneous "if, after a review of the entire record, the appellate court is left with a definite and firm conviction that a mistake has been made.” People v Gistover, 189 Mich App 44, 46; 472 NW2d 27 (1991). Second, the ultimate decision whether to sentence the minor as a juvenile or as an adult and the sentence itself should be reviewed for an abuse of discretion, utilizing, as to the sentence, the standard identical to that used in reviewing sentencing decisions for adults. As noted above, the abuse-of-discretion standard for review of sentencing requires reversal if this Court determines that the sentence imposed upon the defendant "violates the principle of proportionality, which requires sentences imposed by the trial court to be proportionate to the seriousness of the circumstances surrounding the oifense and the offender.” Milbourn, supra at 636.
Simply put, Michaels’ characterization of the experts’ testimony is not supported by the record. Each of the experts recommended that Michaels be sentenced as an adult, noting the violent and serious nature of the crimes, that there was a substantial danger of recurring dangerous behavior, that Michaels would not be responsive to treatment, and that Michaels would be disruptive within the juvenile system.
The trial court, in a well-reasoned opinion, found that Michaels’ behavior was indicative of an increased violent state and part of a repetitive pattern; that the crimes committed were premeditated and deliberated, occurring over a period of time sufficient to enable Michaels to take a second look, which he did not do; that Michaels was a leader, not a follower, and had undertook to commit crimes of a "violent and reprehensible nature”; that rehabilitation, if possible, was more likely to occur in the adult system; and that the interests of the public welfare required sentencing as an adult. Given that our review of the record in this matter does not leave us with a definite and firm conviction that a mistake has been made, we affirm the findings of the trial court.
Similarly, we affirm the trial court’s decision to sentence Michaels as an adult. Given Michaels’ central role in the commission of these heinous crimes, we cannot conclude that the trial court’s decision to sentence him as an adult was not proportionate to the circumstances surrounding Michaels or the offense. Accordingly, we find no abuse of discretion.
Affirmed in part, reversed in part, and remanded to the trial court for further proceedings in accordance with this opinion. We do not retain jurisdiction. | [
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Holbrook, Jr., P.J.
Defendant appeals as of right his jury conviction of one count of kidnapping, MCL 750.349; MSA 28.581, two counts of first-degree criminal sexual conduct, MCL 750.520b; MSA 28.788(2), and one count of armed robbery, MCL 750.529; MSA 28.797. He claims that the trial court erred in admitting into evidence the results of deoxyribonucleic acid (dna) identification testing completed on a sample of dried semen taken from the victim’s blue jeans. After carefully reviewing the evidence, we find that the trial court did not err in allowing the results in evidence. Defendant also claims that the trial court erred in failing to articulate sufficient reasons for imposing disproportionate sentences that departed from the sentencing guidelines range. We agree, and thus remand to the trial court for resentencing.
The Davis-Frye rule, adopted from People v Davis, 343 Mich 348; 72 NW2d 269 (1955), and Frye v United States, 54 App DC 46, 47; 293 F 1013 (1923), allows the admission of expert testimony regarding novel scientific evidence only if that evidence has gained general acceptance among scientific experts in the field. The party offering the evidence carries the burden of demonstrating its acceptance in the scientific community. People v Young, 418 Mich 1, 21, n 7; 340 NW2d 805 (1983); People v Gistover, 189 Mich App 44, 46; 472 NW2d 27 (1991). The trial court’s findings of fact regarding this issue will not be disturbed on appeal unless they are clearly erroneous. MCR 2.613(C); Gistover, p 46. A finding will be determined to be clearly erroneous if, after a review of the entire record, the appellate court is left with a definite and firm conviction that a mistake has been made. Id.
Before reviewing the laboratory procedures, an understanding of the structure of the dna molecule is necessary. The molecule is a double helix, shaped like a twisted ladder. Phosphate and deoxyribose sugar form the rails of the ladder. Four chemical bases—Adenine (a), Cytosine (c), Guanine (g), and Thymine (t)—lie next to each other on the sugar links along the sides of the ladder. Each A always bonds with a t on the other side of the ladder, and each c always bonds with a G on the other side of the ladder, so that the possible base pairs on the ladder are a-t, t-a, c-g, and g-c. The base pairs are connected by a hydrogen bond, such that the bonds form the rungs of the ladder. There are approximately three billion base pairs in one dna molecule. Although no two human beings have the same sequence of base pairs (except for identical twins), we share many sequences that create common characteristics such as arms, legs, fingers, and toes. The sequences of variation from person to person are known as polymorphisms. They contain different alleles, which are alternate forms of a gene capable of occupying a single location on a chromosome. Polymorphisms are the key to dna identification because they create the individual characteristics of everyone and are detectable in laboratory testing.
As described in the lower court proceedings, testing for dna identification involves several procedures. Cellmark Diagnostics is the company that did the laboratory testing in this case. The preliminary procedure is extracting a dna molecule from a cell. This can be accomplished by a protein enzyme, proteinase, and a soap breaking the cell membrane. Organic solvents are used to separate the dna from protein, carbohydrates, and lipids.
Dna identification begins when the dna is cut into pieces creating restriction fragment length polymorphisms (rflp). In this phase, restriction enzymes from bacteria digest the dna into fragments that the enzymes recognize. The goal of the forensic application of dna identification is to isolate the few sequences of base pairs that are not identical in all humans.
The next step in the process is electrophoresis, which separates the different sizes of dna. The dna is placed in a gel called agarose. The gel contains lanes. A dna sample from the victim, the suspect, and from the crime scene evidence is loaded into separate lanes. Because dna has a negative electrical charge, a positive current is run through the gel. The smaller, lighter fragments migrate toward the positive electrode faster than the bigger, heavier fragments. The dna is then filtered to another medium where the fragments can be better seen. The dna is stained with ethidium bromide so that it can be illuminated by ultraviolet light.
After separating the dna by size, the two strands of the double-helix dna are denatured. A solution of alkali separates the dna, like opening a zipper or splitting the rungs of the ladder. The single strands of dna are then transferred onto a nylon membrane. The process of transferring the dna from the gel to the nylon membrane is known as "Southern blotting,” named for the person who originated the technique, E.M. Southern. In fact, the first six steps in the process, from the cutting of the dna by the enzyme to the making of the autoradiogram (discussed below), are sometimes referred to as Southern blotting.
The next step is hybridization. Radioactively labeled dna probes mark the rflp for identification. The probes seek and attach, or hybridize, to the dna on the nylon membrane. The residual probes that do not find complimentary dna are then washed off the nylon filter. The filter is then placed underneath an x-ray film and developed into an autoradiogram. Dark bands appear on the autoradiogram where the probes hybridized to dna. A single probe produces two bands on the autoradiogram. Cellmark uses four single locus probes at the same time, thus producing eight bands. Single locus means the probe attaches to dna from one pair of chromosomes.
The results of the autoradiogram are then interpreted by examining the bands to determine if they match. This process, as well as the statistical analysis, was explained in People v Axell, 235 Cal App 3d 836, 847; 1 Cal Rptr 2d 411 (1991):
Essentially the bands on the autorad from the victim’s, suspect’s, and crime scene evidence samples are "eyeballed” to see if they match within a certain measurement. If a match is declared, the likelihood that a match is unique must be determined. A match is said to occur if the sizes and number of the detected dna fragments in various lanes are indistinguishable within a permissible degree of error. To calculate the permissible degree of error, Cellmark uses "resolution limits” as a unit of measurement to ascertain the "bin” or frequency at which an allele occurs in the population data base.
To make a statistical evaluation of the data obtained from a dna typing, it is necessary to know how frequently in the population a band of a certain size will be found, a question answered according to the principles of population genetics. Each probe recognizes a pair of bands—one from each parent. The probability of the combination of two particular bands recognized by one of the probes is calculated by multiplying the product of the frequencies of the two bands by two. The probability of the band patterns from all four loci is determined by multiplying the products from all four loci. This is known as the "product” or multiplication rule.
The validity of this procedure presupposes that each fact observed, and entering into the calculation, is random and independent of the others, or adjustments are made for deviations from conditions known as "Hardy-Weinberg equilibrium” and "linkage equilibrium.” The Hardy-Weinberg principle is an algebraic equation that describes the genetic equilibrium within a population, assuming random mating. A homozygote is an individual who has inherited the same allele (or same length allele) from both parents. If the incidence of homozygosity far exceeds the expected frequency of that condition, then the data base population is not in Hardy-Weinberg equilibrium. [Citations omitted.]
For a further, more detailed explanation of the dna identification process and statistical analysis, see People v Castro, 144 Misc 2d 956, 964-970; 545 NYS2d 985 (1989).
At the pretrial hearing in this case, the preliminary examination testimony of Doctor David Houseman was incorporated into the record. Dr. Houseman is a professor of molecular biology at the Massachusetts Institute of Technology. He reviewed Cellmark’s procedures at their laboratory. He testified that Southern blotting was applied worldwide in the diagnosis of genetic conditions such as cystic fibrosis, muscular dystrophy, and Huntington’s disease. He stated that the test was generally accepted in the scientific community as reliable.
The prosecution first presented at the hearing Doctor Bonnie Blomberg, an associate professor of molecular biology and immunology at the University of Miami School of Medicine. For the past ten years she has utilized the Southern blotting technique in researching ailments such as Graves’ disease. She visited Cellmark’s laboratory and is familiar with their procedures. The only difference between her research and Cellmark’s testing was the use of different probes. She testified that Cell-mark’s technique was generally accepted in the scientific community as reliable.
The prosecution next called Doctor Michael Imperiale as an expert witness. Dr. Imperiale is an assistant professor of microbiology and immunology at the University of Michigan. He uses the Southern blotting technique in studying cancer-causing viruses. After reviewing Cellmark’s protocols and visiting their laboratory, Dr. Imperiale stated that Cellmark’s procedures conformed to his laboratory’s standards regarding Southern blotting.
The next expert presented by the prosecution was Doctor George Herrin, Jr. His entire hearing testimony is not included in the lower court record provided to this Court. Nevertheless, Dr. Herrin, the dna unit supervisor at the Georgia Forensic Laboratory and former staff scientist at Cellmark, testified at trial that the kflp test was generally accepted in the scientific community.
The final expert called by the prosecution to testify at the hearing was Doctor David Ginsburg, who is employed at the University of Michigan medical school as a molecular biologist focusing on the genetics of bleeding disorders. He routinely uses the Southern blotting technique in the laboratory. Dr. Ginsburg also observed Cellmark’s method of operations and reviewed their protocols. He concluded that the Southern blotting technique performed by Cellmark was generally accepted within the scientific community as accurate and reliable.
Defense counsel then called an expert witness, Doctor Robert Sever. Dr. Bever is an associate director at Genetic Design, Incorporated, a paternity testing laboratory. He is familiar with and has performed the Southern blotting technique. He also stated that the dna identification as performed by Cellmark is generally accepted within the scientific community as reliable.
All the expert witnesses testified that dna identification is generally accepted in the scientific community. These witnesses were unquestionably disinterested and impartial experts in this particular field. People v Young (After Remand), 425 Mich 470, 479-480; 391 NW2d 270 (1986). Further, the Congressional Office of Technology Assessment has found that dna identification testing is valid and reliable in forensics when properly performed and analyzed by skilled personnel. Axell, pp 858-859. Indeed, all other jurisdictions that have addressed the admissibility of the results of dna identification testing, under either a Davis-Frye standard or a reliability test under rules of evidence, have concluded that dna identification testing is reliable. Axell, p 856; Castro, p 973 (although the procedure is reliable, the evidence was inadmissible because the testing laboratory failed to use generally accepted scientific techniques); United States v Jakobetz, 955 F2d 786 (CA 2, 1992); Prater v State, 307 Ark 180; 820 SW2d 429, 436 (1991); Commonwealth v Curnin, 409 Mass 218; 565 NE2d 440 (1991); People v Lipscomb, 215 Ill App 3d 413; 574 NE2d 1345, 1357 (1991); Hopkins v State, 579 NE2d 1297, 1302 (Ind, 1991); State v Brown, 470 NW2d 30, 32-33 (Iowa, 1991); Smith v Deppish, 248 Kan 217, 238; 807 P2d 144 (1991); State v Davis, 814 SW2d 593 (Mo, 1991); State v Wimberly, 467 NW2d 499, 505-506 (SD, 1991); Caldwell v State, 260 Ga 278, 285-287; 393 SE2d 436 (1990); State v Pennington, 327 NC 89, 101; 393 SE2d 847 (1990); Kelly v State, 792 SW2d 579, 585 (Tex App, 1990); Glover v State, 787 SW2d 544, 548 (Tex App, 1990); State v Ford, 301 SC 485, 490; 392 SE2d 781 (1990); State v Schwartz, 447 NW2d 422 (Minn, 1989) (dna test results are admissible if performed with appropriate laboratory standards, but the results were found inadmissible there because the laboratory did not comport with quality guidelines); State v Woodall, 182 W Va 15; 385 SE2d 253 (1989) (testing procedures are reliable, but the results were inadmissible because they were inconclusive); Andrews v State, 533 So 2d 841 (Fla App, 1988); Cobey v State, 80 Md App 31; 559 A2d 391 (1989).
Defendant in this case acknowledges that gel electrophoresis is a generally accepted scientific method, but protests that the forensic application of the method is invalid. He raises the problem of crime-scene contamination. He also mentions the scarcity of dna samples from the crime scene that limits the availability of repeated testing.
We do not require scientific tests to be infallible, but only that reasonable certainty follow from them. People v Barbara, 400 Mich 352, 365; 255 NW2d 171 (1977). Dr. Imperiale testified that if contamination were to occur, the testing would yield no result because of the total degradation of the dna molecule. Alternatively, contamination would result in extra bands appearing on the autoradiogram. Compare Young (After Remand), p 500 (the effects of contamination on electrophoresis was not clear.) Unlike Castro, there was no indication of extra bands in this case. Dr. Blom berg stated that Cellmark’s probes do not bind to either viral or bacterial dna. Moreover, the dna identification testing cannot result in a "false positive,” i.e., a false match of the suspect’s dna and the sample from the crime scene. If the laboratory fails to take the proper steps in the procedure, no readable result is visible on the autoradiogram.
We conclude that the trial court did not clearly err in finding that the prosecution established that dna identification testing is generally accepted in the scientific community as reliable. Given the overall acceptance of the technique in other jurisdictions, we hold that trial courts may take judicial notice of the reliability of dna identification testing. Woodall; Jakobetz. Nevertheless, before a trial court admits the test results into evidence, the prosecutor must establish in each particular case that the generally accepted laboratory procedures were followed. See Barbara, p 415; People v Lucas, 188 Mich App 554, 580; 470 NW2d 460 (1991); Cf. Jakobetz. We are satisfied that Cell-mark followed the generally accepted procedures in this case.
Defendant argues that the statistical analysis of the dna identification testing is inadmissible at trial. He questions the notion of the Hardy-Weinberg equilibrium, contending that populations fail to randomly mate because identifiable subpopulations tend to mate within their own ethnic community because of economic forces and lack of social mobility. Defendant claims that the danger with dna identification evidence is that "trial by mathematics” will evolve. At trial, Dr. Herrin testified that the statistical possibility of matching the seven bands on the crime scene autoradiogram was one in four hundred million.
Defendant’s contentions are inconsistent with the testimony presented in the lower court. Dr. Ginsburg testified that he was familiar with the gene and allele frequency computations of Cell-mark and thought they were valid. He stated that their calculations tended to be conservative. The markers Cellmark uses are highly polymorphic, meaning that the results of the testing include numerous possibilities of alleles. Consequently, the possibility of an independent match of bands can be calculated to a high degree of probability. Defendant’s expert witness, Dr. Bever, did not question the validity of Cellmark’s computations, but only stated that he would be more confident of the results if Cellmark used a larger database. Notwithstanding this concern, one expert testified that a statistical analysis can be recomputed using the latest available database without repeating the Southern blotting procedures.
The defendant fails to persuade us that the admission of dna identification evidence will lead to an improper trial by mathematics. In People v Collins, 68 Cal 2d 319; 438 P2d 33 (1968), the Supreme Court of California held that the trial court erred in admitting without an adequate evidentiary foundation and proof of statistical independence evidence regarding the mathematical probability of persons with the defendant’s characteristics having committed the robbery. Unlike Collins, the lower court record in this case contains an adequate foundation and proof of independence of the statistical analysis. The results of dna identification testing would be a matter of speculation without the statistical analysis, and it does not remove the issue of identity from the jury, which is free to disregard or discredit the evidence. Brown, p 33. Like the statistical evidence concerning serological testing, the statistical evidence is relevant in this case, and any question concerning the size of the database or the Hardy-Weinberg equilibrium goes to the weight of the evidence and is properly left to the jury. People v Proveaux, 157 Mich App 357, 365-366; 403 NW2d 135 (1987).
Some courts of other jurisdictions have ruled that dna identification evidence is admissible at trial, but have then refused to allow into evidence the statistical analysis of the testing because the databases were shown to have not been in Hardy-Weinberg equilibrium. Cumin, pp 225-227; Caldwell, pp 289-290; State v Pennell, 584 A2d 513, 517-520 (Del Super, 1989). However, other courts have recognized that conservative or reduced calculations such as those used by Cellmark may correct any Hardy-Weinberg deviation problems. Axell, p 868; Caldwell, p 289; Castro, p 969. The statistical analysis of dna testing is inadmissible in some jurisdictions because of its prejudicial effect. Schwartz, pp 428-429; Pennell, pp 519-520. On the other hand, some courts have held that such evidence is a matter of weight for the jury. Axell, p 868; Hopkins, p 1303; United States v Yee, 134 FRD 161 (ND Ohio, 1991). In this case, Dr. Blomberg stated at the pretrial hearing that Cell-mark properly calculated the allele frequency. She testified that the standard deviation from repeatedly running the sample molecules through one gel was so small that it was inconsequential. More over, Dr. Ginsburg further stated that statistical analysis, based on a database of between 125 and 250 subjects, was valid. Thus, we find that the trial court did not abuse its discretion by admitting the statistical analysis into evidence. Jakobetz; Axell.
Turning to the issue concerning the defendant’s sentences, we agree with the defendant that the trial court failed to articulate sufficient reasons for departing from the sentencing guidelines range. Under the principle of proportionality, we review the defendant’s sentences to determine whether they are proportionate to the seriousness of the circumstances surrounding the offense and the offender. People v Milbourn, 435 Mich 630, 636; 461 NW2d 1 (1990); People v Witcher, 192 Mich App 307, 308; 480 NW2d 636 (1991). The sentencing court is required to state on the record the criteria considered and the facts supporting the sentence imposed in order to aid the appellate review of sentences imposed. People v Fleming, 428 Mich 408, 428; 410 NW2d 266 (1987); People v Poppa, 193 Mich App 184, 189-190; 483 NW2d 667 (1992). Where the sentence imposed is within the recommended guidelines range, reference to the guidelines alone constitutes sufficient explanation. People v Broden, 428 Mich 343, 354; 408 NW2d 789 (1987); People v Dukes, 189 Mich App 262, 266; 471 NW2d 651 (1991). However, where the sentence imposed exceeds the recommended minimum range, the trial court must articulate both on the record at sentencing and on the sentencing information report its reasons for departing from the guidelines. Fleming; People v Johnson, 187 Mich App 621, 630; 468 NW2d 307 (1991).
In this case, the sentencing guidelines recommended a minimum range of six to fifteen years for the kidnapping conviction, and the trial court sentenced the defendant to life imprisonment for that conviction. The minimum range for the first-degree criminal sexual conduct convictions was eight to twenty years, and the minimum range for the armed robbery conviction was five to fifteen years. The court sentenced the defendant for each of these remaining three counts to 70 to 150 years’ imprisonment. The trial court stated at sentencing that the defendant repudiated all moral authority, was a danger to the community, and that he denied a civilized society to the victim and her family. The court failed to state on the sentencing information report its reasons for departing from the guidelines. Because the defendant’s sentences were more than three times as long as the recommended minimum term of years and because the court failed to state specifically its reasons for departing from the guidelines, we vacate the defendant’s sentences and remand for resentencing. Applying the factors listed by this Court in People v Fisher (After Second Remand), 190 Mich App 598, 608; 476 NW2d 762 (1991), lv gtd 439 Mich 995 (1992), we deny the defendant’s request that he should be resentenced before a different judge.
Convictions affirmed, sentences vacated, and case remanded for resentencing in accordance with the principle of proportionality.
Marilyn Kelly, J., concurred.
Electrophoretic typing of dried bloodstains has gained general scientific acceptance for reliability and is admissible in criminal trials where adequate safeguards have been implemented. Gistover, pp 53-54.
In Schwartz, pp 426-428, the Minnesota Supreme Court held that the dna identification test results were inadmissible because the laboratory, Cellmark, did not comply with the quality control standards published by the FBI’s Technical Working Group on dna Analysis Methods and the California Association of Crime Laboratory Directors. In this case, however, Dr. Herrin testified that while these guidelines provided good suggestions, they do not have any relevance to the reliability of the testing.
See Hoeffel, The dark side of dna profiling: Unreliable scientiñe evidence meets the criminal defendant, 42 Stan L R 465, 490 (January, 1990). | [
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Stone, J.
The defendant was convicted of the crime of larceny of $26 lawful money of the United States, from the person of one Samuel Harris, under an information charging robbery, being armed with a dangerous weapon, in violation of section 15206, 3 Comp. Laws 1915. Upon the trial the evidence was very conflicting. On the part of the people it was testified that about 12 o’clock midnight of July 29, 1917, the defendant entered the saloon of Harris in.the city of Detroit being armed with a revolver which he discharged into the ceiling in the presence of Harris, who testified:
“The defendant came up to me right away with his gun saying: ‘Give me the money or I will kill you.’ I was standing by the cash register behind the bar and he stuck the gun at me. He says ‘Give me money.’ I told him,' ‘Wait, I will give it right away.’ He said, ‘Come on, give me your money or I will kill you right away.’ He pointed the revolver at me, shaking it that way. • I was scared, to turn around, thinking he might shoot me in the back, so I said, ‘Come on behind, I will give it to you.’ I opened the register, grabbed whatever I could give and put it on the bar,” and that defendant took the money and went away.
On the part of the defendant it was testified that defendant went into the saloon of Harris earlier in the night and had been there induced by Harris to enter a gambling game called a “crap” game, then in progress in the saloon, in which he lost $27; that he asked Harris to restore the money, which he refused to do; whereupon he went to his home, a short distance from the saloon, but soon returned to the saloon with a revolver. The defendant testified:
“The first thing as I stepped up to the door I made a shot into the ceiling. I was careful not to shoot any one. Right after that I stuck the revolver in my coat pocket. When I entered the saloon, I had' no gun in my hand. There were some people scattered around the back side of the saloon. I said ‘Give me my money,’ to the saloon and to the fellows that robbed me. I said nothing to Harris. After the shot I saw him come from the back end, from around the barrels. Harris said to me, ‘Hey, there, what is the matter?’ I said, ‘These fellows got my money and I would like to have some .one restore it back.’ He said, T don’t want any of that thing around here; I will pay you, how much is it?’ I. said‘$27.00.’ And he went over to where the gamekeeper was sitting and brought me back $26.00. He said he didn’t want that disturbance at that time of night. I told him, ‘Thank you,’ and walked out. .* * * I went back there to get the money they robbed me of, and went home to get my gun.”
The court was requested by defendant’s counsel, among other things, to charge the jury as follows:
“5. I further charge you, gentlemen of the jury, that in considering all of the evidence in this case touching the matters involved, you will take into consideration all of the evidence in the case, and if you find, gentlemen of the jury, that the defendant only used that necessary force to repossess himself of his own property, which had been taken from him by crap game shooting in said saloon, then you cannot hold the defendant guilty of robbery as charged in the information.
“6. The Revised Statutes, chapter 156, of 1897 [2 Comp. Laws 1915, § 7795 et seq.], provides that any person obtaining money by card playing or shooting craps or shooting dice or any gambling device whatever, if the sum obtained by said playing is less than $25 the person obtaining said money is subject to a fine of $100 or to be confined in jail for three months, or both such fine and imprisonment; if the person playing such crap game receives more money from such gambling than said sum of $25, then, if convicted, he shall be subject to a fine of $500, or twelve months in the county jail, or both such fine and imprisonment-, in the discretion of the court. I further charge you, gentlemen of the jury, that this same statute which I have mentioned gives the loser of his money — which would be this defendant, if he lost his money in ■ said saloon and by that method of crap shooting and gaming — a right to recover the same in cases of assumpsit for money had and received, or in an action of trespass on the case, or by replevin for and on behalf of the plaintiff. Therefore, I charge you that if this money was obtained by gambling, as aforesaid, from the defendant, that the prosecuting witness or any one who was present shooting crap games in said saloon, could not acquire any title to said property, because it is in contravention of the law to play such games, and they never come into the legal possession of said money; if you find these facts to be true from the evidence, gentlemen of the jury, you must acquit the defendant, as he is not guilty of the charge as set up in the information.”
Neither of said requests was given. The trial court charged the jury in part as follows:
“I will charge you, if this defendant voluntarily went into what is known as a crap game and lost his money in that way and he came back and endeavored through violence and at the point of a revolver to secure his money back from Mr. Harris, I charge you, gentlemen of the jury, that under those circumstances that he would be guilty of robbery.
“It may be true, that if a man in, your presence is attempting to steal your property and attempting to carry it away, you have a right to defend yourself, and you have a right to overcome him, and you have a right to retake your property; there is no question about that, but after voluntarily surrendering your money or surrendering your property, and then the property is out of your possession, out of your sight, then, gentlemen of the jury, it is not your province or any man’s province, rather, to undertake to take the law into his own hands, and by force and violence to make a reparation of the wrong done to him. That is for the courts, that is for the legal channels in the peaceful, orderly administration of the law, rather than by any man taking it by violence into his own hands. * * *
“But if this defendant went in there, as under the theory of the people, and did what they said he did, that is the people’s witnesses, then, gentlemen of the jury, you should convict him, and if he went back there and did what the complainant, Harris, has said he did, that he came into the place and shot off the gun and pointed it at Harris, and secured the money which he had lost in a crap game, and attempted to take from Mr. Harris what he had previously lost in a crap game, then, gentlemen of the jury, he is guilty of the charge in the information. * * *
“But if he (the defendant) did lose the money at that crap game and then he went away and after-wards came back and held Mr. Harris up, as he described, laboring under the theory that he had lost his money in the previous cráp game, and resented it, and attempted to get it back, I say to you, gentlemen of the jury, under those circumstances, the defendant would be guilty of the charge in this information. * * *
“Now, this information contains the charge of robbery — being armed with a dangerous weapon with intent to kill if resisted. It also contains the charge of larceny from the person. If you do not believe the defendant guilty of robbery, being armed with a, dangerous weapon and if resisted with intent to kill, you may convict this defendant of larceny from the person, if you believe him guilty of that beyond a reasonable doubt. * * *
“This information contains also the charge of larceny. If you do not find the defendant guilty of the two offenses which I have just enumerated that are included in this information, beyond a reasonable doubt, then you may convict this defendant of larceny, if you believe him guilty of that beyond a reasonable doubt, gentlemen. If you find him guilty of that beyond a reasonable doubt, gentlemen of the jury, then fix the value of the property taken in your verdict.”
After conviction the defendant was sentenced to imprisonment in the Detroit house of correction for a term of not less than 6 months, nor more than 5 years. He has brought the case here on writ of error. Error is assigned upon the refusal to charge as requested above, and to that part of the charge above set forth.
As defendant was not convicted of robbery and was only convicted of larceny, it is suggested that if there was error in that part of the charge relating to robbery it was harmless error. But it should be borne in mind that, without defining the crime of' larceny, the jury were instructed that they might convict of larceny if they believed the defendant guilty of that crime, beyond a reasonable doubt. Yet the element of felonious intent is present in larceny, the same as in robbery. We are of the opinion that the foregoing request to charge should have been given. Our statute gives a right to the loser to recover the money or property lost in a gambling game — and among other actions gives that of replevin — thus recognizing the money or property as belonging to him. Hess v. Culver, 77 Mich. 598, 601; Lassen v. Karrer, 117 Mich. 512.
We are also of the opinion that there was prejudicial error in the charge. If the defendant in good faith believed that the money which he demanded was his money, and that he was entitled to its possession, he could not be guilty of either robbery or larceny in taking it, because there would be no felonious intent, “and if the defendant, for any reason whatever, indulged no such intent, the crime cannot have been committed.” People v. Walker, 38 Mich. 156; State v. Koerner, 8 N. D. 292 (78 N. W. 981).
A case very much in point is that of Thompson v. Commonwealth in the court of appeals of Kentucky, 18 S. W. 1022. The opinion being brief, we quote it:
“The appellapt was convicted of the crime of rob bing J. R. Barnes. The money that the appellant is accused of robbing said Barnes of, was won by Barnes from appellant that evening at an unlawful game; and the appellant thereafter presented his pistol on Barnes, and compelled him to return him the money thus won. Under our' statute the title to the money won by Barnes did not pass to him, or from the appellant, nor did the right to its possession pass to Barnes, as against the appellant. It is a uniform rule that a person is not guilty of stealing that which belongs to him, and to which he has a right. Robbing is larceny, accompanied by violence, and putting the person from whom the property is taken in fear. Here the fact that the appellant was entitled to the money, and Barnes’ possession of it was not rightful, as against the appellant, stripped the appellant’s act of feloniously taking the property of another with the fraudulent intention of permanently depriving the owner of it.”
The judgment was reversed. To the same effect are the following cases: State v. Hollyway, 41 Iowa, 200; People v. Hall, 6 Parker’s Cr. R. (N. Y.) 642; Rex v. Hall, 3 Car. & Payne, 409.
The last cited case was an indictment for robbing John Green, a gamekeeper of Lord Ducie, of three hare wires and a pheasant. It appeared that the prisoner had set three wires in a field belonging to Lord Ducie, in one of which this pheasant was caught; and that Green, the gamekeeper, seeing, this, took up the wires and pheasant, and put them into his pocket; and it further appeared that the prisoner, soon after this, came up and said: “Have you got my wires?” The gamekeeper replied that he had, and a pheasant that was caught in one of them. The prisoner then asked the gamekeeper to give the pheasant and wires up to him, which the gamekeeper refused; whereupon the prisoner lifted up a large stick, and threatened to beat the gamekeeper’s brains out if he did not give them up. The gamekeeper fearing violence did so. Baron Vaughan said:
“I shall leave it to the jury to say whether the prisoner acted on an impression that the wires and pheasant were his property; for, however he might be liable to penalties for having them in his possession, yet, if the jury think that he took them under a bona fide impression that he was only getting back the possession of his own property, there is no animus furandi, and I am of opinion that the prosecution must fail.”
There was a verdict of not guilty.
In our opinion the question of felonious intent in the instant case should have been submitted to the jury, under appropriate instructions as to both robbery and larceny, along the lines above indicated.
We find no other reversible error in the record. For the errors pointed out the judgment is reversed and a new trial granted.
Ostrander, C. J., and Bird, Moore, Steere, Brooke, Fellows, and Kuhn, JJ., concurred. | [
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Bird, J.
Defendant McVannell, who was engaged in the livery business in the city of Marquette, entered into a contract in September, 1914, with the city to improve Specular street. Before commencing the work he accepted in writing the provisions of the workmen’s compensation law for his livery business and street contract work. In July, 1915, he contracted with Charles Dutmer to clear a certain piece of land lying two miles north of the city. To aid him in this work he employed Charles Anderson, a son of the plaintiff. While blasting stumps Anderson was killed. His mother, the plaintiff, applied to the industrial accident board for an award and it was granted in the sum of $6.49 per week for 300 weeks.
Defendants contended before the board, as they do here, that the board had no jurisdiction to make an award in the premises, because the deceased did not belong to either class of employees which was protected by McVannell’s acceptance of the compensation law; that Anderson was neither employed in the livery stable nor on the street contract. The material part of McVannell’s acceptance of the compensation law is in the following form:
“......Number of employees: Eight.
“Location of place of employment: Livery and road contract.
“ (If more than one plant, place of business or work, place, state each fully.)
“Livery: Baraga avenue; street contract: Specular street, Marquette, Michigan.
“Nature of employment: Livery and street contract.”
Plaintiff takes the position that:
“An employer of labor in Michigan who accepts the provisions of the- Michigan workingman’s compensation law, accepts it for the benefit of all employees he employs in all the businesses he conducts. Except only that his acceptance does not cover household, domestic servants and farm laborers unless the acceptance specifically covers such employees; and except, also, that no acceptance includes any person whose employment is but casual, or is not in the usual course of the trade, business, profession or occupation of the employer.”
An examination of the compensation act does not disclose that it anywhere in express terms permits an employer to come under the law as to one business and not to another, nor does it anywhere prohibit it in express terms. It does not compel an employer to accept its terms for any of his business activities unless he chooses to do so. He is free to come under the law or to stay out. This being so, why may he not accept its terms as to one business and not to another? Inasmuch as the election lies with him whether he will come under the law, I can see no good reason why he should not be permitted to accept its terms -for one distinct business and not for another. It may be, and probably is, a reasonable construction of the act to say that when one elects to come under it his election covers all employees in the distinct business specified in his application, because if this were not so it would lead to much confusion among the employers as to which ones were covered and which were not covered. But no serious confusion would occur if all employees in a distinct business were protected. We think it is doing no violence to the act to hold that it contemplates that an employer with two or more business activities may accept as to one and not as to the others. This question , was before the court in Kauri v. Messner, 198 Mich. 126. It was there said:
“It is contended by defendant that the acceptance of the act and Messner’s contract of indemnity cover only the men engaged in his lumbering business, and not the men to whom he gives casual employment in some other business. In other words, that he had a right to accept the compensation act as a lumberman without doing so as a farmer. This point appears to be well taken. It has already been decided by this court that a man may engage in more than one enterprise and may accept the terms of the compensation act as to one and not as to the other.” Citing Bayer v. Bayer, 191 Mich. 423.
A suggestion is made that this holding is not conclusive of the present controversy, if the conclusion in the case cited was rested on the fact that the employee was engaged in farming, an occupation within the excepted class. The language of the opinion clearly indicates that the result reached was not rested upon that ground but was rested squarely on the fact that the deceased was not within the class of employees engaged in logging. We think the case is ruled by the one cited, and, therefore, the finding of the industrial accident board must be reversed and the award vacated.
Ostrander, C. J., and Moore, Steere, Brooke, Fellows, Stone, and Kuhn, JJ., concurred. | [
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Sawyer, P.J.
Defendant was convicted of first-degree retail fraud, MCL 750.356c(2); MSA 28.588(3)(2), and thereafter pleaded guilty of being a fourth-felony offender, MCL 769.12; MSA 28.1084. He was sentenced to serve two to fifteen years in prison. He now appeals, and we vacate his conviction and remand the matter to the trial court for entry of a conviction of second-degree retail fraud, MCL 750.356d; MSA 28.588(4), and resentencing accordingly.
Defendant’s conviction arises out of the theft of less than $100 worth of merchandise and would normally have constituted second-degree retail fraud. However, MCL 750.356c(2); MSA 28.588(3X2) provides for conviction of first-degree retail fraud for conduct that would otherwise constitute second-degree retail fraud if the defendant previously has been convicted of one of the offenses enumerated in the statute. Defendant admits a prior conviction of attempted larceny in a building, MCL 750.92; MSA 28.287 and MCL 750.360; MSA 28.592, thus resulting in his conviction of first-degree retail fraud.
The question presented, whether a prior convic tion of attempted larceny in a building is sufficient to raise second-degree retail fraud to first-degree retail fraud, is oné of first impression. MCL 750.356c(2); MSA 28.588(3)(2) provides as follows:
A person who violates section 356d and has 1 or more prior convictions under this section, section 218, 356, 356d, or 360, or a local ordinance substantially corresponding to this section or section 218, 356, 356d, or 360 is guilty of retail fraud in the first degree.
The question thus is whether a conviction of an attempt to commit one of the enumerated offenses is sufficient to constitute a conviction of one of the enumerated sections. The heart of the question is whether a conviction of an attempt to commit an offense constitutes a conviction of the substantive, underlying offense for which the attempt statute merely provides a different penalty, or whether an attempt is a separate, substantive offense.
Attempt is an inchoate offense, the punishment for which is provided in MCL 750.92; MSA 28.287:
Any person who shall attempt to commit an offense prohibited by law, and in such attempt shall do any act towards the commission of such offense, but shall fail in the perpetration, or shall be intercepted or prevented in the execution of the same, when no express provision is made by law for the punishment of such attempt, shall be punished as follows:
1. If the offense attempted to be committed is such as is punishable with death, the person convicted of such attempt shall be guilty of a felony, punishable by imprisonment in the state prison not more than ten [10] years;
2. If the offense so attempted to be committed is punishable by imprisonment in the state prison for life, or for five [5] years or more, the person convicted of such attempt shall be guilty of a felony, punishable by imprisonment in the state prison not more than five [5] years or in the county jail not more than one [1] year;
3. If the offense so attempted to be committed is punishable by imprisonment in the state prison for a term less than five [5] years, or imprisonment in the county jail or by fine, the offender convicted of such attempt shall be guilty of a misdemeanor, punishable by imprisonment in the state prison or reformatory not more than two [2] years or in any county jail not more than [1] year or by a fine not to exceed one thousand [1,000] dollars; but in no case shall the imprisonment exceed one-half [V2] of the greatest punishment which might have been inflicted if the offense so attempted had been committed. [Emphasis added.]
The wording of the statute indicates that the Legislature created the separate, inchoate crime of "attempt.” The statute, in three locations, states that a person who is convicted of an attempt is guilty of a felony or a misdemeanor, depending on the nature of the attempt, and the statute proscribes a punishment. This is language that creates a substantive offense of "attempt,” not merely one that modifies the punishment applicable to the completed offense where the defendant did not complete the underlying offense.
In fact, the general, view is that attempt is a lesser-included offense of the completed offense. In People v Adams, 416 Mich 53, 57, 61; 330 NW2d 634 (1982), the Supreme Court concluded that attempt is a cognate lesser-included offense of the underlying offense, overruling a prior case that held that attempt is a necessarily lesser-included offense. The Court reasoned that "the elements of an attempt are not duplicated in the completed offense.” Id. at 56. See also 2A Gillespie, Michigan Criminal Law & Procedure (2d ed), § 1072, p 736 (attempt is a necessarily included offense in every charge of a crime). Moreover, the criminal jury instructions regarding attempt as a lesser offense refer to attempt as being a "less serious crime.” CJI2d 9.2.
For these reasons, we conclude that attempt is a separate, substantive offense punishable under its own statute. Thus, the crime of attempted larceny in a building is separate from the crime of larceny in a building. Furthermore, while larceny in a building (§ 360 of the Penal Code) is one of the enumerated offenses in the first-degree retail fraud statute, attempt (§92 of the Penal Code) is not. Therefore, defendant is not guilty of first-degree retail fraud, only second-degree retail fraud.
This conclusion is also consistent with the rule of lenity. The Supreme Court explained the rule of lenity in People v Gilbert, 414 Mich 191, 211; 324 NW2d 834 (1982):
Because courts are wary of creating crimes, penal statutes are to be strictly construed and any ambiguity is to be resolved in favor of lenity:
" 'When Congress leaves to the Judiciary the task of imputing to Congress an undeclared will, the ambiguity should be resolved in favor of lenity. And this not out of any sentimental consideration, or for want of sympathy with the purpose of Congress in proscribing evil or antisocial conduct. It may fairly be said to be a presupposition of our law to resolve doubts in the enforcement of a penal code against the imposition of a harsher punishment.’ ” Bell v United States, 349 US 81, 83; 75 S Ct 620; 99 L Ed 905 (1955), quoted approv ingly in People v Bergevin, 406 Mich 307, 312; 279 NW2d 528 (1979).
The scope of this statute is at least uncertain; it should be applied only to those acts which the Legislature clearly meant to proscribe.
See also People v Rehkopf, 422 Mich 198, 207; 370 NW2d 296 (1985).
Although there certainly are reasons to include attempts to commit one of the enumerated crimes in the first-degree retail fraud statute, the Legislature did not explicitly include attempts. The Legislature could have, if it had so desired, included the phrase "or an attempt to commit” in § 356c(2), but did not. For all this Court knows, the Legislature considered, and rejected, including attempts in the statute. Certainly "[t]he scope of this statute is at least uncertain,” Gilbert, supra at 211, and, therefore, under the rule of lenity this Court should conclude that an attempt to commit one of the enumerated offenses is insufficient to raise second-degree retail fraud to first-degree retail fraud.
Brief consideration should be given to the one case cited by the prosecutor, People v Brown, 186 Mich App 350; 463 NW2d 491 (1990). Brown did comment that two of the defendant’s three prior felony convictions were for offenses enumerated in § 356c(2), noting those to be larceny in a building and attempted larceny in a building. Id. at 352. However, whether attempted larceny in a building is actually an enumerated offense was not an issue before the Court, and, thus, its statement that it is an enumerated offense is not part of the holding of Brown. Rather, the Court merely assumed that it was without analyzing the issue.'
In light of the resolution of this issue, it is unnecessary for us to address defendant’s remaining issues.
Defendant’s conviction is vacated and the matter is remanded to the trial court with instructions to enter a conviction of second-degree retail fraud and to resentence defendant accordingly. We do not retain jurisdiction.
Gillespie seems to have overlooked the change in Adams that attempts are now considered cognate included, not necessarily included.
It should be noted that, as acknowledged in the attempt statute, some statutes provide punishment for both the attempt and the underlying offense. However, this is not the case with the larceny in a building statute. | [
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] |
Per Curiam.
Plaintiff Lener Davis appeals as of right from the trial court’s order granting defendants’ motions for a directed verdict in this defective design and manufacture case. We affirm.
Plaintiff was a punch press operator at Whirlpool Corporation. On January 19, 1987, plaintiff caught her hand in the pinch point between the gib of a press frame and the ram of the press as the ram was on its up stroke and suffered serious injuries to her fingers. Plaintiff filed suit against defendant Link, Inc., the manufacturer of the die used in the press, and defendant Capitol Engineering Company, the designer of the die, alleging failure to design and manufacture sufficient guarding of pinch points.
i
Plaintiff first argues that the trial court utilized an improper standard when ruling on defendants’ motions for a directed verdict. We disagree. Whirlpool contracted with defendants to design and manufacture a component part, according to Whirlpool’s specifications. The component part, a die, was installed by Whirlpool into a press used to manufacture lids for washing machines. There is no allegation that the die itself was defectively designed or manufactured. See Antcliff v State Employees Credit Union, 95 Mich App 224, 232-233; 290 NW2d 420 (1980).
The supplier of a die set to a component manufacturer does not have a duty to place guards on the die set or warn the component manufacturer of hazards attendant in its use. Fredericks v General Motors Corp, 411 Mich 712, 720; 311 NW2d 725 (1981). At the time of plaintiff’s injury, 1967 PA 282 required that each employer establish and maintain conditions of work that were reasonably safe and healthful for employees. Fredericks, supra at 720. Pursuant to MCL 408.1016; MSA 17.50(16) and MCL 408.1021; MSA 17.50(21), the Michigan Department of Labor has authority to promulgate standards of safety for the workplace. 1979 AC, R 408.12411 provides in part:
The employer shall insure, by adequate supervision, that correct operating procedures are being followed and that all required safeguards are installed, are functional, and are being used.
In light of this statutory duty imposed on Whirlpool, the relevant inquiry is whether there was evidence presented of the manufacturer’s knowledge of unsafe use or that unsafe use is foreseeable. Shipman v Fontaine Truck Equipment Co, 184 Mich App 706, 712-713; 459 NW2d 30 (1990). The trial court utilized such a standard in ruling on defendants’ motions for a directed verdict. Plaintiff failed to present evidence of the manufacturer’s knowledge of unsafe use, and no evidence was presented that unsafe use was foreseeable. To the contrary, the evidence revealed that the die had been successfully used in the press for four or five years without incident before plaintiff’s injury. Donald Reitz, a Whirlpool employee whose job it was to set the die in the press, testified that there was no obvious pinch point in the press and that he never recognized a hazard before plaintiffs injury. Viewing the evidence of foreseeability in a light most favorable to plaintiff, the evidence was insufficient to establish a prima facie case, and the motion for a directed verdict was properly granted. Reisman v Regents of Wayne State University, 188 Mich App 526, 538; 470 NW2d 678 (1991).
n
Next, plaintiff argues that defendants "assumed a duty” to comply with the regulations of the Occupational Safety and Health Act (miosha), MCL 408.1001 et seq.; MSA 17.50(1) et seq., when they considered miosha regulations in designing dies. Plaintiff further argues that admission of the standards was necessary to establish defendants’ breach of duty. We disagree, miosha regulations are applicable to employers and employees only. Zalut v Andersen & Associates, Inc, 186 Mich App 229, 235; 463 NW2d 236 (1990).
iii
Lastly, plaintiff argues that the trial court improperly excluded the testimony of plaintiffs expert witness, Adolf Wolf. There are three prerequisites to the admission of expert testimony: (1) the witness must be an expert, (2) there must be facts in evidence that require or are subject to examination and analysis by a competent expert, and (3) there must be knowledge in a particular area that belongs more to an expert than the common man. King v Taylor Chrysler-Plymouth, Inc, 184 Mich App 204, 215; 457 NW2d 42 (1990); People v Beckley, 161 Mich App 120, 125; 409 NW2d 759 (1987), affd 434 Mich 691; 456 NW2d 391 (1990). The party that proffers the expert bears the burden of persuading the trial court that the expert has specialized knowledge that will aid the factfinder in understanding the evidence or determining a fact in issue. People v Smith, 425 Mich 98, 112; 387 NW2d 814 (1986). A witness may be qualified as an expert by knowledge, skill, experience, training, or education. MRE 702; Mulholland v DEC Int'l Corp, 432 Mich 395, 403; 443 NW2d 340 (1989).
The qualification of a witness as an expert and the admissibility of the expert’s testimony are in the trial court’s discretion and will not be reversed on appeal absent an abuse of that discretion. Mulholland, supra at 402.
In this case, the issue involved the design and manufacture of a die. Plaintiff’s proffered expert, Adolf Wolf, is a mechanical engineer. Though Wolf did take a class in machine design during his undergraduate studies in the 1960s, he has never designed a die. Wolf has never worked for a tool and die designer, has never attended a tool and die design school, has never served as an apprentice for a tool builder or tool designer, and has never worked as a journeyman, tool builder, or tool designer. In fact, Wolf stated:
I’m not a tool and die maker, no, sir. In fact, in this case I never even looked at the die itself because from the parts that were produced it appears there was nothing wrong with the die that was manufactured to perform the part or manufacture the part. I never even looked at that.
A review of the extensive voir dire of Wolfs qualifications reveals that the trial court did not abuse its discretion in sustaining defendants’ objection to Wolfs qualifications and in excluding his proffered expert testimony. Although Wolf was educated as a mechanical engineer, he does not have the necessary experience and training to qualify him as an expert in metal forming systems or as a tool builder.
Affirmed. | [
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Steere, J.
In this proceeding plaintiff filed its petition in the circuit court of Wayne county for a writ of mandamus to compel defendant in the performance of his prescribed official duties to prepare, countersign, and transmit to the city treasurer certain school bonds which plaintiff had authorized and negotiated at a rate of interest exceeding four per cent, per annum.
While in defendant’s formal answer to an order to show cause other questions are raised, the direct and controlling reason for refusal involved and argued here is that the proposed issue of bonds authorized by plaintiff bore a rate of interest in excess of the limit fixed by law.
Whether the proposed rate of interest is forbidden depends upon the validity of Act No. 322, Local Acts 1915, purporting to amend section 13 of Act No. 233, Laws 1869, entitled “An act relative to free schools in the city of Detroit,” which followed under the same title and was in effect a revision and elaboration of Act No. 70, Session Laws of 1842, under which the Detroit schools had previously operated. Section 13 of the 1869 act, amended 1903 (Act No. 392), relates to financing the Detroit school system and makes provision for raising by taxation and bonding, through co-operation of the school board and common council, necessary funds to equip and maintain the public schools of the city, with the restriction, however, that in case funds are raised by the issuance of bonds they shall “bear interest at a rate not exceeding four per cent, per annum.” The only change in the law of 1869, as previously amended, made by said Act No. 322, is that bonds issued by authority of section 13 shall “bear interest at a rate not exceeding six per cent, per annum.” This amending act contained no referendum, and defendant contends that it is essentially a local or special act, never submitted to or approved by the electors and promulgated in direct violation of the prohibition specified in section 30 of article 5 of the Constitution of 1909 that:
“The legislature shall pass no local or special act in any case where a general act can be made applicable, and whether a general act can be made applicable shall be a judicial question. No local or special act shall take effect until approved by a majority of the electors voting thereon in the district to be affected.”
This law is both localized and specialized in its application to the amendment of an act stamped with those attributes. Aside from the contention of plaintiff that its relation to the subject of education oper ates to entirely relieve it, as a matter of law, from its local and special characteristics, it cannot in reason be regarded as otherwise than a local or special, act, locally applicable only within the territorial boundaries of Detroit and especially directed to its school bonds. Neither from the nature of the subject can we conceive, judicially or otherwise, why a general act fixing the maximum rate of interest for school bonds cannot be made applicable, or any difficulty in formulating a law authorizing every public school district within the State to issue its bonds according to existing or provided methods and limitations, at a rate of interest not to exceed a specified per cent, per annum, either as a whole or by classification, if size, population, wealth, or other distinctions are shown to furnish a legal basis for such course.
That laws analogous in purpose and provisions to the one under consideration have, though dealing with education, generally been regarded as local and special both in litigation and legislation, is evidenced in many ways — by numerous decisions of this court, many briefs filed by able counsel in which they are so treated without controversy, and as a general rule by the legislature when dealing with them. The act of 1869 “relative to free schools in the city of Detroit,” with its amendments, has been carried under that title as a local act in the. volumes of local laws published “by authority” since its enactment. A concurrent resolution of the legislature of 1869 required that its acts should be printed and bound in two volumes, the first to contain all acts of a general nature, with joint and concurrent resolutions, the second volume to contain charters, etc., and other acts of a local character. This act relative to the schools of Detroit is in the second volume. In that year the case of People v. Board of Education of Detroit, 18 Mich. 409, was decided, and in an able opinion by Chief Justice Cooley the posi tion under the general school laws of the State of specially provided city or municipal schools is discussed and declared. It was there said “the city of Detroit is one of the towns provided for by special legislation,” the conclusion being reached that “at every point the general law is complementary to the special legislation, and is necessary to give it complete operation,” and all parts of the general law “not inconsistent with the free school act apply to the city of Detroit.” Referring to the fact that the law had just been “revised throughout” the court said, “but the city is still declared to be one school district in the same language we have quoted from the original act.” In Keweenaw Association v. School District, 98 Mich. 437, referring to the enlarged powers given cities and villages in relation to their schools, it is said:
“These are conferred by special acts, and in all other particulars the primary school law controls the union school districts iñ such localities.”
That the legislature regarded school legislation of this nature as local and special is indicated by the language found in other enactments. In Act No. 61, Pub. Acts 1911 (2 Comp. Laws 1915, § 5766), which provided for changing the boundaries of school districts, certain action is authorized “regardless of whether such school districts were formed * * * or created under any local or special law.”
Many similar authoritative utterances are to be found in the statutes and decisions of this State answering negatively the proposition of plaintiff’s counsel that Act No. 322 of 1915 is not to be regarded as a local or special act as either term is generally used and legally construed, unless it can be said some provision in the Constitution of 1909 expressly or by implication puts the legislature above and beyond constitutional limitations when dealing, with education.
As counsel point out, it was early said and has been consistently held, that under the policy of this commonwealth education belongs to the State, and the Constitution has turned all matters of education over to the legislature with broad powers of provision and control. Cases may be pointed out where it is indicated that certain provisions of the Constitution in other articles dealing with subjects foreign to “education,” which is in an article by itself, are not always regarded as a limitation upon the legislature in educational matters, but we cannot find that this court has ever held, or, intentionally at least, used language indicating that the legislature, when enacting laws upon the subject of education, is endowed with powers-beyond the limitations of those conferred in the very article of the Constitution which created it as one of the departments of State government. Without the Constitution which the people in their sovereign' power have ordained and established as the form of government for the State, delineating in it certain first principles of our fundamental laws, there would be no legislature or other State governmental departments as they now exist. In appropriate sequence, following the preliminary articles relative to boundaries and seat of government, declaration of rights and elective franchise, the Constitution lays the foundation for and adopts a scheme or form of State government dividing its powers into three departments, and in the three succeeding articles separately provides for and defines in general terms the duties and powers of each with their limitations, first taking up the legislative department, in article 5, and vesting its powers in a legislative body composed of a senate and house of representatives, whose qualifications, field of action, duties and governmental limitations are then outlined. This article dealing directly with the general powers of the legislature, without reference to or exception of any particular subject of legislation, declares in section 30 the prohibition against local or special legislation quoted. Having next in sequence provided for and defined the powers vested in the executive and judicial departments, the Constitution proceeds to deal with various other subjects of governmental concern in separate articles — such as “local government,” “finance and taxation,” “education,” “corporations,” “eminent domain,” etc. To whatever extent the provisions of those articles may affect each other, we find no such qualifications in any of them as override the plain and comprehensive prohibition in section 30 of article 5 dealing directly with the general powers of the legislative department.
While it can with truth be broadly said that in its chief essentials the Constitution has committed the whole subject of education to the legislature, that statement is qualified to a degree by direct mandates in the article on “education” and no exception appears in that article or elsewhere in the Constitution providing that the legislature in enacting laws upon that subject can ignore the requirements and limitations prescribed in the article dealing directly with the legislative department. Plaintiff's contention carried to its logical conclusion places the legislature in matters of education outside the pale of all such mandates and restrictions.. In Burton v. Koch, 184 Mich. 250, cited by plaintiff, where numerous cases are referred to, “upon the point that the legislature under the Constitution has substantially complete control over school districts,” it is not said and cannot be construed as meaning that those plenary powers, though recognized as broad and comprehensive, are independent of express constitutional limitations, for it is said later in the opinion of the act under consideration, which relates to education:
“The court has nothing to do with the wisdom of this legislation. The legislative power, with certain constitutional limitations, is vested elsewhere.”
It cannot in reason be otherwise than that all powers of the legislature, whatever they may be, are, under and by virtue of the Constitution, subject to general constitutional mandates and limitations imposed on legislation without reservation.
In the official address issued by the constitutional convention to the people of the State explaining proposed changes in the Constitution and the reason for each, as the law required, it is said of the inhibition this act disregards that:
“It is intended to eliminate the vast volume of local legislation which has burdened the legislature in recent years and in many instances brought discredit upon it. * * * It will not only relieve the legislature, but will also remove one of the greatest sources of evil in modern legislative bodies.”
Prepared and presumably adopted with such intent and purpose the generalized negative mandate against any local or special legislation except as defined,- without attempt to enumerate any particular subjects of legislation which are prohibited, or excepted, indicates an éxpansion rather than restriction of the scope of limitation, to the exclusion of implied exceptions. Anderson v. Cloud County, 77 Kan. 721.
This very question of local legislation as applied to education was under consideration in the constitutional convention and debated (Vol. 1, page 193, Cons. Conv. Debates). Had it been the sense of the convention that so important subject as education should be excepted from the inhibition of section 30, it could, and presumptively would, have been so provided in unequivocal terms. So far as a failure to do so after the attention of the convention was called to the subject aids construction, it is persuasive that such was not the intention.
Conceding all that is urged as to the meritorious purpose and necessity of the proposed issue of bonds, and accepting without qualification all representations relative to the emergency which unforeseen conditions in the money market have given rise to as a result of the present war, and even conceding those facts should have any contemporaneous bearing upon the constitutionality of a statute passed to meet such existing emergency, the fact that this law was enacted more than two years ago, in 1915, when, so far as shown, there was no emergency or imminent necessity and this country was not at war, precludes their consideration here.
For the reasons stated we are impelled to conclude that the order of the lower court granting a writ of •mandamus herein must be reversed, but without costs, as the issue is between officials acting in good faith to test a legal question of public interest.
Ostrander, C. J., and Bird, Moore, Brooke, Fellows, Stone, and Kuhn, JJ., concurred. | [
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Per Curiam.
In this legal malpractice case, defendant appeals by leave granted from an order of the Wayne Circuit Court denying his motion to change venue improperly laid. We affirm.
FACTS
Plaintiff, who resides in Washtenaw County, was discharged from her employment with Detroit Public Schools in Wayne County. Plaintiff subsequently contacted defendant E. Donald Gurwin regarding a potential wrongful discharge action against the school system. Defendant had four meetings with plaintiff in his Oakland County office. By letter dated July 31, 1987, defendant informed plaintiff that he would not represent her because it was his opinion that there was no liability on the part of the school system. In declining the case, defendant allegedly gave incorrect advice to plaintiff regarding the applicable statute of limitations.
On June 29, 1990, defendant filed a motion to change venue improperly laid, arguing that no part of the cause of action for legal malpractice arose in Wayne County. Defendant alleged that plaintiff’s injuries arose in either Oakland County or Washtenaw County.
At a hearing on defendant’s motion, plaintiff argued that a part of her legal malpractice action was to prove the underlying action, which occurred in Wayne County. The trial court agreed with plaintiff that her cause of action required adjudication of the underlying suit and denied the motion. Therefore, part of the cause of action arose in Wayne County, and venue was properly laid in Wayne County.
i
If venue is improperly laid, it must be changed upon a motion to do so. MCR 2.223(A)(1). An action for legal malpractice is a tort claim and its venue is controlled by MCL 600.1629; MSA 27A.1629. Under § 1629(l)(a), venue is proper where all or part of a cause of action arises, not merely at the situs of an injury. Lorencz v Ford Motor Co, 439 Mich 370, 375; 483 NW2d 844 (1992). This Court reviews a trial court’s decision regarding venue to determine whether the trial court clearly erred in ruling that venue was proper. Marsh v Walter L Couse & Co, 179 Mich App 204, 207; 445 NW2d 204 (1989).
ii
In an action for legal malpractice, the plaintiff must establish (1) the existence of an attorney-client relationship, (2) the acts that are alleged to have constituted negligence, (3) that the negli gence was a proximate cause of the injury, and (4) the fact and extent of the injury alleged. Lowman v Karp, 190 Mich App 448, 451; 476 NW2d 428 (1991); Basic Food Industries, Inc v Grant, 107 Mich App 685, 690; 310 NW2d 26 (1981).
In cases such as this one, where an attorney’s conduct prevents the client from bringing a contemplated action, we believe that an additional element is intertwined with the requirement of establishing proximate causation and damages. In Basic Foods, supra, this Court discussed the "suit within a suit” requirement:
The factor which has occasioned most difficulty to clients attempting to charge attorneys with liability for negligence in connection with litigation has been the necessity of proving that the damages claimed resulted from the alleged misconduct. The recovery sought is usually the value of the claim in suit in the proceeding in which the negligent act occurred, if the client was a plaintiff in that action, or, if he was a defendant, the amount of the judgment imposed upon him, and, in accordance with general rules as to proximate cause, it is generally held that before such recovery can be had the client must establish that, absent the act or omission complained of, the claim lost would have been recovered or the judgment suffered avoided. Accordingly, the client seeking recovery from his attorney is faced with the difficult task of proving two cases within a single proceeding. [107 Mich App 691, citing 45 ALR2d 5, § 2, p 10.]
In addition to proving negligence, plaintiff must show that but for her attorney’s negligence she would have been successful in the original litigation; in effect, she must prevail in two distinct suits. This suit within a suit concept has vitality only in a limited number of situations, such as where an attorney’s negligence prevents the client from bringing an action, where the attorney’s failure to appear causes judgment to be entered against the client or where the attorney’s negligence prevents an appeal from being perfected. In such cases, the underlying action constitutes at least a part of the cause of action for legal malpractice. Venue would therefore be proper in the county where the underlying action occurred, as well as in any jurisdiction where a part of the cause of action arose. Lorencz, supra, p 375. The trial court did not err in denying defendant’s motion to change venue.
Affirmed.
Plaintiff alleged that had she been properly advised regarding the correct statute of limitations she would have had an opportunity to seek alternative representation on her claim.
MCL 600.1629(l)(a); MSA 27A.1629(l)(a) provides:
(a) A county in which all or part of the cause of action arose and in which either of the following apply is a proper county in which to 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.
Basic Food Industries v Grant, 107 Mich App 685; 310 NW2d 26 (1981), established the elements of a legal malpractice action. Under element three, Basic Food used the language "the proximate cause.” This Court has consistently used such language in obiter dictum. See, e.g., Lowman v Karp, 190 Mich App 448, 451; 476 NW2d 428 (1991), Stockler v Rose, 174 Mich App 14, 25; 436 NW2d 70 (1989); Adell v Sommers, Schwartz, Silver & Schwartz, PC, 170 Mich App 196, 204; 428 NW2d 26 (1988). However, in Ignotov v Reiter, 425 Mich 391, 400, 402, n 1; 390 NW2d 614 (1986) (Boyle, J., concurring and Riley, J., dissenting), Justices Boyle and Riley opined that the proper language should be "a proximate cause” to conform with established law. Kirby v Larson, 400 Mich 585, 605; 256 NW2d 400 (1977). We agree that the proper language is "a proximate cause.”
Venue would also be proper in Oakland County, where the attorney-client relationship was conducted, and in Washtenaw County, where the erroneous advice was received. | [
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Brennan, J.
Plaintiff appeals as of right from a March 8, 1990, order granting defendants summary disposition. Plaintiff filed suit alleging sex discrimination under the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq., after his employment was terminated because his hair fell below his shirt collar in violation of defendants’ grooming policy. We affirm.
Plaintiff began working for RPM Pizza, Inc., a franchise of Domino’s Pizza, Inc., in November 1986 as a counter person. At the time plaintiff was hired, rpm had in place a single grooming policy applicable to both males and females that provided:
Hair—there shall be no loose hair. All hair is to be restrained by a baseball cap or a hair net is required. Must be tucked under a hat so hair is not on forehead or visible from the front of the hat. Must be at or above the collar.
In order to comply with the policy, men with longer hair would tuck their hair into a cap. In January 1988, in order to comply with Domino’s grooming policy, rpm announced that men would now have to cut their hair at or above the collar to be in compliance with rpm’s grooming policy. Plaintiffs employment was terminated after he refused to cut his hair in compliance with the policy. A written version of the modified policy was distributed in March 1988.
Plaintiff subsequently filed this suit. Plaintiffs amended complaint alleged that defendants violated the Civil Rights Act when they applied their unisex grooming policy in a disparate manner by requiring only men to cut their hair at or above the collar. Defendants moved for summary disposition, arguing that rpm’s policy was modified to provide for sex-specific grooming policies, in conformance with Domino’s policy and that there was no disparate treatment. The court granted defendants summary disposition, finding that defendants had in place sex-specific policies and that there was no evidence of disparate treatment with respect to enforcement of the sex-specific grooming policies. On appeal, plaintiff argues that the court erred in granting summary disposition because a question of fact existed whether rpm had in place a sex-neutral, rather than a sex-specific, grooming policy that was applied in a disparate manner when plaintiff was fired. The court apparently granted summary disposition pursuant to MCR 2.116(C) (10). In deciding a motion brought under this subrule, the court must give the benefit of reasonable doubt to the nonmovant and determine whether a record might be developed that would leave open an issue upon which reasonable minds could differ. Werth v Taylor, 190 Mich App 141, 145; 475 NW2d 426 (1991).
The issue whether a male-only hair-length grooming requirement constitutes sex discrimination has never been determined by a Michigan court pursuant to Michigan’s Civil Rights Act. However, the issue has been addressed by federal courts in regard to title VII of the Civil Rights Act of 1964, 42 USC 2000e et seq. Michigan’s Civil Rights Act is substantially the same as title VII with regard to its sex discrimination provisions. This Court has held that federal civil rights cases interpreting title VII are persuasive authority for resolving cases brought pursuant to the Michigan act. Northville Public Schools v Civil Rights Comm, 118 Mich App 573, 576; 325 NW2d 497 (1982). A review of the federal case law reveals that it is irrelevant whether a sex-neutral or sex-specific policy is in effect. Federal courts have held that sex-differentiated hair-length grooming requirements do not constitute sex discrimination under title VII. See Fagan v National Cash Register Co, 157 US App DC 15; 481 F2d 1115 (1973); Dodge v Giant Food, Inc, 160 US App DC 9; 488 F2d 1333 (1973); Willingham v Macon Telegraph Publishing Co, 507 F2d 1084 (CA 5, 1975); Longo v Carlisle DeCoppet & Co, 537 F2d 685 (CA 2, 1976). The courts, for the most part, found that title VII protection does not encompass those characteristics not inherently immutable, such as different grooming standards for men and women. The courts reasoned that title VII was never intended to interfere with grooming policies that have no significant effect upon the employment opportunities afforded one sex in favor of the other. See cases cited above. See also 1 Larson, Employment Discrimination, § 41.11, pp 8-112—8-127.
Plaintiff misconstrues the disparate-treatment test in title VII cases. It is irrelevant whether defendants had a sex-specific grooming policy or a unisex grooming policy with an unwritten requirement that men wear their hair cut above the collar. Courts have held that such unwritten policies do not violate title VII. Miller v Missouri P R Co, 410 F Supp 533 (WD Mo, 1976). Title VII may, however, be violated when the grooming code that applies to each sex is not equally burdensome or when the overall grooming code is not enforced in an evenhanded manner. Equal Employment Opportunity Commission Compliance Manual, §619, p 3602, Dodge, supra, p 13, Willingham, supra, p 1092, and Knott v Missouri P R Co, 527 F2d 1249, 1252 (CA 8, 1975). However, see contra Fountain v Safeway Stores, Inc, 555 F2d 753 (CA 9, 1977). An example of uneven enforcement of a grooming code would be if an employer has a dress and grooming policy for men and women but only enforces the male hair-length provision. Equal Employment Opportunity Commission Compliance Manual, § 619, p 3602.
In this case, there is no allegation that each sex’s individual grooming requirements were not enforced evenhandedly. Further, plaintiff does not contend that the overall grooming policy burdens one sex more than the other so as to favor the employment of one sex over the other. Accordingly, we find that because defendants’ grooming standards would not violate title VII, they do not violate Michigan’s Civil Rights Act. Therefore, we find that the trial court properly granted defendants summary disposition, albeit for the wrong reason. Portice v Otsego Co Sheriff’s Dep’t, 169 Mich App 563, 566; 426 NW2d 706 (1988). Plaintiff further argues that the trial court erred in finding that defendants had a sex-specific grooming policy in effect at the time of plaintiff’s termination. However, this issue becomes moot in light of our disposition of the first issue.
Affirmed.
These cases represent, only a sampling of the numerous cases reaching this result.
We note that in 1975, the Michigan Department of Civil Rights issued a policy statement on grooming requirements. The statement reflects recognition of the fact that virtually all courts are reaching a similar decision, that title VII was intended to protect against sex-based discrimination and was not intended to encompass different grooming standards for men and women. The department decided not to continue to accept or process charges of this nature.
We note that eeoc interpretations are entitled to great deference by the courts. Griggs v Duke Power Co, 401 US 424, 434-435; 91 S Ct 849; 28 L Ed 2d 158 (1971).
We note that defendants’ policy requires females to secure their hair. | [
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Weaver, P.J.
Plaintiff began working for Murphy Motor Freight Lines as a trailer-truck driver in October 1968. On December 13, 1984, plaintiff injured his back while unloading desks from a truck. Plaintiff attempted to return to work on January 21, 1985, but the pain was too severe. He was placed on medical leave and began to receive workers’ compensation benefits. On June 18, 1985, Murphy offered plaintiff a job involving security and clerical duties tailored to meet plaintiff’s medical restrictions. However, plaintiff refused the job, stating he was afraid his medication would make him drowsy and unable to drive. Plaintiff brought a claim for workers’ compensation benefits.
The magistrate found plaintiff disabled as a result of the December 13, 1984 injury and granted an open award of benefits. Defendants appealed, and the Workers’ Compensation Appeal Board affirmed. Defendants now appeal by leave granted, and plaintiff cross appeals. We reverse.
i
Defendants first claim it was error for magistrate Freedman to issue an opinion on the merits of this case when he was not the original trier of fact.
The case was originally assigned to hearing referee Washington, who took testimony on three days. The statutory changes that substituted magistrates for referees then took effect, and the case was assigned to magistrate Tilles. When Tilles had a heart attack, the case was assigned to magistrate Freedman. Defendants argue the case should be remanded for a new decision after further hearing. We disagree.
This, case was reviewed by the wcab, which is specifically required to conduct fact finding de novo. The wcab commits legal error if it relies upon the findings or expertise of the referee or magistrate. Kostamo v Marquette Iron Mining Co, 405 Mich 105; 274 NW2d 411 (1979). Thus, defendants’ complaint is irrelevant.
ii
Defendants contend the wcab erred in awarding plaintiff weekly benefits after it found plaintiff unreasonably refused their offer of favored work. The wcab found plaintiff forfeited his right to benefits from the date of his refusal, June 19, 1985, but held that it was reinstated as of February 26,1987, when Murphy filed for bankruptcy.
The favored-work doctrine requires only that an employer keep open an offer for a reasonable time under all the circumstances. Russell v General Motors Corp, 172 Mich App 627; 432 NW2d 738 (1988). After that time, the company should be permitted to withdraw its offer with no fear of disadvantage. Id. In this case, the offer was effectively kept open for over a year and a half. During that time, no indication was given by plaintiff that he might be interested in the job. Thus, even though the company’s bankruptcy effectively meant the offer was withdrawn, plaintiff was not once again entitled to compensation benefits.
Plaintiff argues that MCL 418.301(5); MSA 17.237(301X5) should be interpreted to mean that the employee’s refusal ends when the employer either withdraws its offer or goes out of business. Review of the statute does not persuade us of the validity of this argument.
Our holding in this section renders the remainder of defendants’ arguments moot.
iii
Plaintiff has cross appealed, arguing that the job offer was not reasonable because he could not perform the work offered by Murphy. Plaintiff contends that he rejected the job partly because the medication he was taking caused drowsiness and he was afraid that he would kill someone if he drove to work. Plaintiff therefore contends that the offered work was not reasonable employment because it threatened his health and safety and was not within a reasonable distance from his residence, as required under MCL 418.301(9); MSA 17.237(301)(9).
We disagree. The wcab found that the offered employment was reasonable, falling within plaintiffs medical restrictions, and rejected plaintiffs explanation for his refusal to take the position. These findings are supported by competent record evidence and are therefore conclusive. MCL 418.861; MSA 17.237(861).
We reverse the order of the wcab awarding plaintiff benefits after June 18, 1985. We do not retain jurisdiction.
MCL 418.301(5); MSA 17.237(301X5) provides in pertinent part:
"If disability is established pursuant to subsection (4), entitlement to weekly wage loss benefits shall be determined pursuant to this section and as follows:
"(a) If an employee receives a bona fide offer of reasonable employment from the previous employer, another employer, or through the Michigan employment security commission and the employee refuses that employment without good and reasonable cause, the employee shall be considered to have voluntarily removed himself or herself from the work force and is no longer entitled to any wage loss benefits under this act during the period of such refusal.
For the purposes of this appeal only, we assume that § 301(9) does in fact apply. | [
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Sawyer, P.J.
Defendant appeals from a circuit court judgment that declares certain portions of a Flint city ordinance to be violative of state law and permanently enjoins defendant from enforcing those sections of its ordinance. We affirm.
The matter was submitted to the trial court on stipulated facts. Plaintiff, a public utility, is licensed by the state under the Mechanical Contractors Act, MCL 338.971 et seq.; MSA 18.86(1) et seq., as a contractor to provide gas furnace and appliance inspection, maintenance, and repair services. The city enacted an ordinance that required the licensing or registration of journeymen and apprentices. Plaintiff’s journeyman and appren tices were not licensed or registered under the ordinance, and defendant issued an appearance ticket charging plaintiff with a violation of the ordinance. That ticket was dismissed, apparently because of technical defects in the ticket itself, but defendant represented that it still intended to enforce its ordinance and would reissue a ticket against plaintiff if it did not comply with the ordinance. Plaintiff then brought this action to enjoin enforcement of the ordinance.
The trial court granted plaintiff relief with respect to certain portions of the ordinance, concluding that those sections constituted a licensing requirement and that § 9 of the Mechanical Contractors Act precludes municipalities from enacting local licensing ordinances in this area.
We turn first to the issue whether § 9 of the Mechanical Contractors Act, MCL 338.979; MSA 18.86(9), precludes a municipality from licensing journeymen and apprentices working in the mechanical trades. Defendant argues that the act does not prevent local licensing of journeymen and apprentices; rather, it only precludes local licensing of contractors. MCL 338.979; MSA 18.86(9) provides as follows:
After the effective date of this act, a governmental subdivision shall not establish or maintain local licensing requirements for the work classiñcations set forth in section 6(3). A governmental subdivision shall not prohibit a contractor licensed under this act from engaging in the work classification or classifications for which the contractor has a license, unless the contractor is in violation of the mechanical code. [Emphasis added.]
Section 6(3), MCL 338.976(3); MSA 18.86(6X3), provides as follows:
A contractor’s license obtained by licensure or examination shall be classified and limited as 1 or more of the following:
(a) Hydronic heating and cooling and process piping.
(b) hvac equipment.
(c) Ductwork.
(d) Refrigeration.
(e) Limited service, heating or refrigeration.
(f) Unlimited service, heating or refrigeration.
(g) Fire suppression.
(h) Specialty.
The trial court opined as follow's:
The Court agrees with plaintiff that Section 9 prohibits local licensing of mechanical journeys and apprentices for the work classifications in Section 6(3). The first sentence of Section 9 could not be much more clear. The second sentence does not qualify the first sentence or limit the prohibition to local licensing of contractors. Rather, the second sentence simply prevents a City from prohibiting a licensed contractor from engaging in those lines of work unless he or she is in violation of the State mechanical code. It is not up to a Court to say whether the flat-out prohibition of local licensing is wise or not.
We agree with the trial court that the first sentence of § 9 clearly precludes local licensing in this area and that that prohibition is not limited to contractors. While the act as a whole does deal with the state licensing of contractors, the first sentence of § 9 speaks in very broad terms. It states that a local governmental unit "shall not” establish "licensing requirements for the work classifications” in § 6(3). It does not limit its terms to "local contractor licensing,” nor does it contain an exclusionary clause that allows local licensing of journeymen and apprentices. Rather, it broadly precludes local licensing requirements for the work classifications contained in §6(3), the so-called mechanical trades.
Further, there is no indication from the language in § 9 that the reference to § 6(3) intended that §9 be limited to contractors. Rather, the explicit language of § 9 merely refers to the "work classifications” set forth in §6(3). It would only appear that the Legislature did not wish to repeat the list of eight work classifications and, therefore, incorporated the list in § 6(3) by reference, without any indication that the reference to the work-classification list was intended to otherwise limit the provisions of § 9.
State preemption of a particular area exists, inter alia, "where the state law expressly provides that the state’s authority to regulate in a specified area of the law is to be exclusive,” and in such cases "there is no doubt that municipal regulation is pre-empted.” People v Llewellyn, 401 Mich 314, 323; 257 NW2d 902 (1977). The language of § 9 is clear that there are to be no local licensing ordinances and that the field is expressly preempted by state law. Accordingly, the trial court correctly concluded that, to the extent that the Flint ordinance establishes a licensing requirement, it violates the provisions of § 9 and is unenforceable.
Defendant also argues that the trial court erred in determining that § M-123.6 of the ordinance is a licensing requirement. The trial court concluded that §§ M-123.2, M-123.3, and M-123.4 are local licensing requirements and are barred by the statute. Defendant appears to concede that those sections constitute a licensing requirement, but, of course, argues that they are permitted.
The trial court concluded that § M-123.6 may be a licensing requirement:
M-123.6 is so badly worded it is difficult to understand. If legal permission to work as an apprentice, with proper supervision, will be withheld because of a failure to do more than give pertinent information, then M-123.6 also appears to be prohibited.
M-123.6 provides as follows:
Registration of Apprentices: Apprentices shall be registered with the Division of Building and Safety Inspection to facilitate qualification of the experience required for Journey application of examination.
The trial court is correct that if § M-123.6 is a licensing requirement, it is prohibited. More to the point, however, it appears to be a section that no longer serves a useful purpose in light of the striking down of the preceding sections concerning the licensing of journeymen. The stated purpose of M-123.6 is to "facilitate qualification of the experience required for Journey application of examination.” That is, it is designed to assist in the licensing of journeymen by documenting experience as an apprentice to establish qualification for licensing under the local ordinance. Although M-123.6 may only require registration, it operates as part of the prohibited licensing scheme and, therefore, would also be violative of the state statute. Accordingly, the trial court did not err in failing to rule that M-123.6 was permissible.
Finally, we note that in its prayer for relief in its brief on appeal, Consumers Power requests that this Court, in addition to affirming the trial court’s rulings with respect to the issues raised by defendant, also reverse the trial court’s ruling that §§M-123.5 and M-123.7 are not licensing requirements prohibited under the statute and reverse the trial court’s decision to the extent that it ruled that § M-123.6 is not a licensing requirement. However, Consumers Power has not filed a cross appeal. Accordingly, its claims of error are not properly before this Court.
Affirmed. Plaintiff may tax costs.
Actually, the license is held by a Consumers’ employee, David F. Larsen. Under the act, a corporation does not hold a license itself. Rather, it must have a designated contractor of record in its employ.
Part of the dispute involves the question whether the ordinance establishes a licensing requirement or merely a registration requirement. | [
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Holbrook, Jr., J.
In these cases consolidated on appeal, defendants, Garth Erbes, Rita L. Erbes, and Oneida Erbes, appeal as of right an Osceola Circuit Court judgment and order enjoining them from manufacturing or assembling pallets on their farm as a business use contrary to the plaintiff’s zoning ordinance. Appellants Herrinton, Herrinton & Tacoma, P.C., James C. Herrinton, and Lois H. Herrinton (the Herrintons) also appeal as of right from the part of the same judgment that ordered sanctions against them in the amount of $750. The Herrintons were the Erbes’ attorneys for the circuit court action and were ordered to pay sanctions by the circuit court for filing a motion to dismiss and a supporting brief for an improper purpose. We affirm the circuit court judgment, but vacate that part of the judgment ordering sanctions against the Herrintons.
Oneida Erbes owns approximately forty acres of farmland in Richmond Township. Garth and Rita Erbes, Oneida’s son and daughter-in-law, live with Oneida and maintain the property. Defendants continue a small traditional farming operation on the property.
In 1978, the Richmond Township Board adopted a resolution for zoning the township. The hearing was held on August 14, 1978. The parties dispute whether the hearing was held by the township board or by the newly established zoning board. Minutes of the meeting were taken by the township clerk, but apparently no minutes of the meeting were taken by a member of the township’s zoning board. Attendance vouchers indicate that several members of the zoning board were present. The former township clerk testified at trial that neither the proposed ordinance nor a zoning map were available at the hearing.
On December 4, 1978, the Richmond Township Board adopted the proposed zoning ordinance. The version of the ordinance adopted by the board classified defendants’ property as residential.
On January 18, 1983, plaintiff adopted a "compilation” of its ordinances, incorporating much of the 1978 zoning ordinance, along with amended and additional sections. The amended zoning ordinance, now included in the 1983 compilation, was entitled Ordinance No. 9.
In 1985, Garth and Rita Erbes began to make wood pallets from wood grown on the wood lot on the farm. A pallet is a wooden platform made of slats cut from low-grade lumber and nailed or stapled together. As production increased, the operation developed into an informal cooperative utilizing wood cut from neighboring farms and sawed at local mills or on portable farm sawmills. Local farmers then used the materials to make pallets, with some of the construction taking place at defendants’ farm. Defendants distributed materials and collected pallets because many of the participants in the pallet operation were Amish and did not have motor vehicles or telephones.
On July 1, 1987, Garth Erbes contacted Richard Kirch, the Richmond Township zoning administrator, and inquired regarding whether defendants could construct a pole barn on the property for the purposes of storage, horse stalls, and pallet assembly. Kirch told him that the uses were permitted because the property was zoned agricultural. The parties dispute whether Kirch later told defendants that the zoning did not permit use of the building for pallet assembly. Defendants applied for and received a building permit for the pole barn.
Defendants then constructed the pole barn at an approximate cost of $10,000. The county building inspector inspected the barn and issued the compliance permit on August 6, 1987. Defendants commenced pallet assembly in the barn. On October 1, 1987, Garth Erbes contacted Kirch concerning proposed additions to the barn. Kirch informed him that pallet assembly activities on defendants’ property were in violation of the township zoning ordinance. Garth Erbes then applied for a zoning permit and a building permit to make the additions to the barn. The permit applications were denied.
On December 4, 1987, Kirch issued defendants a notice of zoning violation, stating that defendants were violating Ordinance No. 9 by conducting an industrial operation in a nonindustrial-use zone. Kirch issued a similar notice on January 14, 1988, and a third notice on March 7, 1988. The third notice charged defendants with violating §§ 20.804 to 20.806 of the zoning ordinance. Defendants claim that these sections are not included in the 1983 compilation of the ordinance, and are instead found in the 1978 zoning ordinance, which the township contends was incorporated into the 1983 version.
Plaintiff then brought criminal charges against defendants in district court alleging violation of Ordinance No. 9. Those charges were dismissed without prejudice. Plaintiff also instituted a civil action in circuit court, seeking injunctive relief for the zoning violation. Defendants counterclaimed, contending that the township’s zoning ordinance was invalid because it was improperly enacted. Defendants further contended that even if the zoning ordinance were valid, the Right to Farm Act, MCL 286.471 et seq.; MSA 12.122(1) et seq., permitted defendants to carry on their pallet operation.
Following an eight-day bench trial held between June 20, 1989, and January 12, 1990, the trial court issued its opinion on April 11, 1990. Relevant to the issues on appeal, the trial court found that the August 14, 1978, hearing was a joint hearing by the township board and the zoning board. The court found that the text of the ordinance and a zoning map were available at the hearing and that the zoning board did not make substantive changes to the ordinance after it was adopted by the township board on December 4, 1978. The trial court then held that plaintiff was not obligated to strictly comply with the procedural requirements of the Township Rural Zoning Act, MCL 125.271 et seq.; MSA 5.2963(1) et seq., and that defendants were estopped on the basis of public policy from challenging any procedural irregularities in the enactment of the ordinance. The trial court rejected defendants’ argument that the Right to Farm Act protected their pallet operation. The court concluded that defendants were precluded by the ordinance from conducting the pallet operation, which constituted an unlawful extension of a nonconforming use.
During the proceedings before the circuit court, the Herrintons filed a motion to dismiss on behalf of defendants. The motion sought dismissal pursuant to MCR 2.116(C)(8) and (9), and was filed with documentary evidence appended. Plaintiff responded to the motion on November 2, 1989. The Herrintons also filed a brief supporting the motion, but did not file the brief until November 1, 1989, and it was not received by plaintiff’s counsel until November 3, the Friday before a scheduled Monday hearing. Plaintiff moved for an award of attorney fees, contending that both the motion and the brief were untimely.
On July 5, 1990, the circuit court issued an opinion and order granting plaintiff’s request for sanctions. The circuit court found that defendants’ motion to dismiss was untimely, that the documentary evidence was improperly appended to the motion, and that the brief supporting the motion was filed untimely and improperly.
On July 18, 1990, the circuit court issued its judgment and order permanently enjoining defendants from conducting their pallet operation on their property, except for pallets constructed from wood grown on their property.
DOCKET NO. 131564
In this case, defendants appeal the circuit court’s order permanently enjoining them from conducting their pallet operation, raising several issues. We find their third issue dispositive of most of their remaining issues, and address this issue first.
Defendants contend that the trial court erred in holding that they were estopped on the basis of public policy from challenging any procedural irregularities in the enactment of the ordinance. Defendants maintain that they should not be barred where plaintiff has failed to show that it would be prejudiced by such a challenge. We disagree.
When a zoning ordinance has been the subject of public acquiescence and reliance for a lengthy time, the reasonableness of a belated challenge is questionable. Edel v Filer Twp, 49 Mich App 210, 214; 211 NW2d 547 (1973); Northville Area NonProfit Housing Corp v Walled Lake, 43 Mich App 424, 434-435; 204 NW2d 274 (1972). In Edel, a challenge to a zoning ordinance eighteen years after its enactment based on a claim that the township failed to strictly comply with the notice requirements of the enabling legislation was held to be precluded by estoppel and by overriding policy considerations. The Court in Northville concluded that a challenge to a zoning ordinance four years after its enactment on the ground that the ordinance was improperly enacted was precluded on public policy grounds. In this case, defendants challenged the zoning ordinance thirteen years after its enactment. During that time, township officials and residents acted in accordance with the ordinance, and no challenges were made with regard to the validity of its enactment. Consequently, we affirm the trial court’s decision that defendants are estopped from challenging the ordinance as having been improperly enacted.
Defendants argue that the trial court erred in holding that plaintiff was not obligated to strictly comply with the procedural requirements of the Township Rural Zoning Act. We recognize that townships lack authority to zone except as specifically granted in the enabling legislation, and that the mandatory provisions of such enabling legisla tion require compliance. See Fox & Associates, Inc v Hayes Twp, 162 Mich App 647, 650; 413 NW2d 465 (1987); Krajenke Buick Sales v Hamtramck City Engineer, 322 Mich 250, 255; 33 NW2d 781 (1948); Davis v Imlay Twp Bd, 7 Mich App 231, 236; 151 NW2d 370 (1967). However, failure to strictly comply with the mandatory procedures of the act does not necessarily invalidate an ordinance. See Brae Burn, Inc v Bloomfield Hills, 350 Mich 425, 429; 86 NW2d 166 (1957); Brown v Shelby Twp, 360 Mich 299, 307; 103 NW2d 612 (1960). Regardless of whether plaintiff was required to strictly comply with the act’s procedures, its failure to do so does not require invalidation of the ordinance, because the defendants’ challenge was untimely.
Defendants further argue that the trial court made findings against the great weight of the evidence when it found that the August 14, 1978, hearing was a joint hearing by the township board and the zoning board, the text of the ordinance and the zoning map were available at the hearing, and the zoning board did not make substantive changes to the ordinance after it was adopted by the township board on December 4, 1978.
Defendants did not move timely for a new trial and therefore failed to preserve this issue for review. Jenkins v Raleigh Trucking Services, Inc, 187 Mich App 424, 429; 468 NW2d 64 (1991). Nevertheless, this Court could review the issue if failure to consider it would result in a miscarriage of justice. Petrus v Dickinson Co Bd of Comm’rs, 184 Mich App 282, 288; 457 NW2d 359 (1990). No miscarriage of justice will result from our failure to review the issue because defendants are es-topped from challenging the ordinance as having been improperly enacted.
Next, defendants contend that plaintiff failed to comply with the notice requirements of the Township Rural Zoning Act, MCL 125.279; MSA 5.2963(9), when it adopted the 1983 compilation of ordinances, which contains Ordinance No. 9. Notwithstanding defendants’ failure to cite authority for their position that the entire compilation is invalid because certain sections were amended without adherence to the proper procedure, defendants are again estopped from challenging the ordinance on public policy grounds. Edel, supra; Northville, supra. Moreover, the trial court correctly found that the changes in the text of the 1978 ordinance as compiled in the 1983 ordinance were not relevant to defendants’ property.
The next issue raised by defendants is whether the adoption and enforcement of Ordinance No. 9 deprives defendants of due process of law. However, the trial court did not address this issue, and our review is limited to issues actually decided by the trial court. Lowman v Karp, 190 Mich App 448, 454; 476 NW2d 428 (1991).
We find that defense counsel improperly presented this issue on appeal. First, defendants’ trial counsel, the Herrintons, attempted to raise and argue this issue on behalf of defendants in the Herrintons’ brief on appeal. Because the Herrintons no longer represent defendants in this matter, the Herrintons are without standing to raise the issue. Ford Motor Co v Jackson (On Rehearing), 399 Mich 213, 226; 249 NW2d 29 (1976); Grace Petroleum Corp v Public Service Comm, 178 Mich App 309, 312-313; 443 NW2d 790 (1989). Second, the Herrintons note in their brief on appeal that they separated their appeal from that of defendants, their former clients, because they wanted to dedicate their brief to raising their appeal of the sanction. The Herrintons thought that raising their issue and defendants’ issues in one brief would be unfair to defendants, who required the full fifty pages allowed by MCR 7.212(B) for their brief. The Herrintons proceeded in their brief on appeal, however, to use approximately twenty-five pages discussing issues on behalf of defendants, which the Herrintons lack standing to raise. Third, defendants’ appellate counsel filed a fifty-page brief on behalf of defendants. With regard to the issue of due process, defendants’ appellate counsel simply referenced the Herrintons’ brief without presenting any argument other than a list of citations.
An appellant must properly argue issues identified in the statement of the questions in order to properly present an appeal. Midland v Helger Construction Co, Inc, 157 Mich App 736, 745; 403 NW2d 218 (1987). We believe defendants’ appellate counsel and former trial counsel acted deceptively to circumvent the page limitations of MCR 7.212(B). Accordingly, plaintiff is entitled to appellate costs because the appellate briefs of defendants’ appellate counsel and former trial counsel are grossly lacking in the requirements of propriety and grossly disregarded the requirements of a fair presentation of the issues to the court. MCR 7.216(C)(1)(b).
Defendants’ final argument is that the trial court clearly erred when it determined that the Right to Farm Act does not protect their pallet-making operation. They claim that the trial court clearly erred in finding that defendants’ property is not a "farm,” that defendants are not conducting "farm operations,” and that pallets are not "farm products” as defined in the act. Defendants maintain that the trial court erred in failing to apply the interim guidelines regarding farm processing of fiber products.
The Right to Farm Act was enacted by our Legislature in 1981 to protect farms from being declared a nuisance. Northville Twp v Coyne, 170 Mich App 446, 448-449; 429 NW2d 185 (1988). The act prohibits a farm or farm operation from being declared a public or private nuisance where the farm or farm operation conforms to "generally accepted agricultural and management practices.” MCL 286.473(1); MSA 12.122(3X1). Whether the farm or farm operation conforms to such practices is determined according to policies articulated by the state agricultural commission. Id.
Section 2 of the Right to Farm Act provides in pertinent part:
(c) "Farm product” means those plants and animals useful to human beings and includes, but is not limited to, forages and sod crops, grains and feed crops, dairy and dairy products, poultry and poultry products, livestock, including breeding and grazing, fruits, vegetables, flowers, seeds, grasses, trees, fish, apiaries, equine and other similar products, or any other product which incorporates the use of food, feed, fiber, or fur.
(d) "Generally accepted agricultural and management practices” means those practices as defined by the commission of agriculture. The commission shall give due consideration to available Michigan department of agriculture information and written recommendations from the Michigan state university college of agriculture and natural resources cooperative extension service and the agricultural experiment station in cooperation with the United States department of agriculture soil and conservation service and the agricultural stabilization and conservation service, the department of natural resources and other professional and industry organizations. [MCL 286.472; MSA 12.122(2).]
The primary goal of statutory interpretation is to ascertain and give effect to the intent of the Legislature. Lorencz v Ford Motor Co, 187 Mich App 63, 68-69; 466 NW2d 346 (1991), lv gtd 437 Mich 1036 (1991). The legislative intent can be ascertained by examining the language of the act, the subject matter under consideration, the scope and purpose of the act, and preceding statutes. Girard v Wagenmaker, 437 Mich 231, 238-239; 470 NW2d 372 (1991). In enacting the Right to Farm Act, the Legislature was concerned with the regulation of land use imposed upon farms by local government as well as private sources, and the impact of such regulation upon farming operations. Northville Twp, supra, p 448.
In this case, we need not determine whether defendants’ property is a "farm” or whether defendants are conducting "farm operations” because the dispositive issue is whether the pallets produced by defendants are "farm products” under the act. The pallets are constructed of wood and nails or staples. The vast majority of the wood used for the pallets originates from outside defendants’ property, while a very small portion of the wood is taken from defendants’ property. The products, therefore, are not grown on the property, but are only assembled there from purchased material. The pallets do not match any of the definitions of farm products set forth in the act, and are not specifically mentioned in the Department of Agriculture’s guidelines.
Defendants argue, however, that the pallets fit within the more general phrase included at the end of the statutory definition of farm products that includes "any other product which incorporates the use of food, feed, fiber, or fur.”
Statutes are to be construed to avoid absurd or unreasonable results. Lepp v Cheboygan Area Schools, 190 Mich App 726, 732; 476 NW2d 506 (1991). Under the rule of ejusdem generis, where a statute contains general words that follow a designation of particular subjects, the meaning of the general words will be presumed to be restricted by the particular designation as including things of a similar kind, class, character, or nature as those specifically enumerated. Attorney General v Blue Cross & Blue Shield of Michigan, 168 Mich App 372, 380-381; 424 NW2d 54 (1988).
Applying this rule of statutory construction, the trial court in this case found that the general words "any other product which incorporates the use of food, feed, fiber, or fur” must be read to mean other products of the same nature as those enumerated in that section. The trial court correctly noted that to give the words the broad meaning argued by defendants would be to allow practically anyone to claim protection under the act when constructing, for example, flooring or furniture, which are arguably products incorporating fiber. The trial court determined that farm products as defined by the act did not incorporate pallets that were only assembled on the property without any of the product having been grown on the property. It was not improper for the trial court to look to the definitions of farm products used by other jurisdictions, considering the lack of guidance provided by the act and the guidelines. We find that the trial court did not clearly err in determining that defendants’ pallets do not fall within the statutory definition of farm products.
DOCKET NO. 131179
In this case, the Herrintons appeal the trial court’s order imposing sanctions against them for filing an improper motion. The Herrintons also raise substantive issues on behalf of defendants, but as we have already ruled, the Herrintons lack standing to raise these issues. Ford Motor Co v Jackson (On Rehearing), supra; Grace Petroleum Corp, supra.
The Herrintons argue that the trial court was not justified in ordering sanctions under MCR 2.114. In Contel Systems Corp v Gores, 183 Mich App 706, 710-711; 455 NW2d 398 (1990), this Court stated:
Since the imposition of a sanction under MCR 2.114 is mandatory upon the finding that a pleading was signed in violation of the court rule, or a frivolous action or defense had been pled, there is no discretion for the trial court to exercise in determining if a sanction should be awarded. Rather, the relevant inquiry is whether the trial court erred in finding that the court rule had been violated and, therefore, that the imposition of a sanction was required. Since this involves a finding of fact by the trial court, that finding must be reviewed to determine if it is clearly erroneous. MCR 2.613(C). A finding of fact is clearly erroneous when, although there is evidence to support it, the reviewing court is left with a definite and firm conviction that a mistake has been committed. Tuttle v Dep’t of State Hwys, 397 Mich 44; 243 NW2d 244 (1976).
MCR 2.114(D)(3) provides:
Effect of Signature. The signature of an attorney or party, whether or not the party is represented by an attorney, constitutes a certification by the signer that
(3) the pleading is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.
Court rules are subject to the same rules of statutory construction as are statutes. Collier v Westland Arena, Inc, 183 Mich App 251, 255; 454 NW2d 138 (1990). Applying the rules of statutory construction, we find that where a court rule provides its own glossary, the terms must be applied as expressly defined. See Harder v Harder, 176 Mich App 589, 591; 440 NW2d 53 (1989).
MCR 2.114(D)(3) plainly states that the rule applies to "pleadings.” A motion is not a pleading pursuant to MCR 2.110(A). This Court’s opinions affirming the imposition of sanctions under MCR 2.114 have involved cases where the propriety of pleadings, and not motions, was disputed. See, e.g., In re Goehring, 184 Mich App 360, 366-368; 457 NW2d 375 (1990); Contel Systems Corp, supra. Although plaintiff relies on Ramsey v Pontiac, 164 Mich App 527, 538; 417 NW2d 489 (1987), that case refers to the imposition of costs for a frivolous motion, as opposed to sanctions for an improper motion. Thus, MCR 2.114 cannot be used to impose sanctions upon a person who signs a motion that is submitted for an improper purpose.
Because the trial court clearly erred in imposing sanctions against the Herrintons pursuant to MCR 2.114 for filing a motion for an improper purpose, we find it unnecessary to discuss whether the motion was improper, whether the Herrintons were denied due process, or the reasonableness of the sanction. Regarding the Herrintons’ issue that the court is required to sanction plaintiff’s counsel for filing the allegedly frivolous motion for sanctions, this issue was not raised in the trial court and we consider it unpreserved for our review. Lowman, supra.
In Docket No. 131179, we vacate that part of the trial court’s order of judgment imposing sanctions against the Herrintons for filing a motion for an improper purpose.
In Docket No. 131564, we affirm the trial court’s decision that defendants are estopped on the basis of public policy from challenging plaintiffs zoning ordinance. Moreover, we find that the trial court did not err in determining that the Right to Farm Act does not protect defendants’ pallet-construction operation. However, we remand this case to the trial court for it to determine the amount of actual damages to which plaintiff is entitled for responding to defendants’ due process issue. We do not retain jurisdiction. | [
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Per Curiam.
In this medical malpractice action, plaintiff, the personal representative of the estate of Robert McNeil, deceased, appeals as of right from an order of the Tuscola Circuit Court that granted summary disposition to defendant pursuant to MCR 2.116(C)(7). The trial court held that plaintiffs claim was barred by the statute of limitations. We reverse.
This case has been before this Court previously. See McNeil v Caro Community Hosp, 167 Mich App 492; 423 NW2d 241 (1988), which sets forth some of the facts of the case. In the prior appeal on leave granted, this Court held that the Saginaw Circuit Court, where plaintiff first brought her claim, had abused its discretion when it set aside a May 10, 1984, order that had dismissed the case with prejudice. The order that set aside the dismissal was entered on March 5, 1985, and the instant defendant was added as a party on May 28, 1985. Later, the two defendant hospitals’ motions for summary disposition in the prior action were denied by the Saginaw Circuit Court, and this Court granted leave to appeal. The instant defendant was not a party to that appeal. After this Court reversed the order that set aside the dismissal and our Supreme Court denied plaintiff leave to appeal, 434 Mich 852 (1990), defendant moved for and was granted summary disposition in the Saginaw Circuit Court. Plaintiff then filed an action in the Tuscola Circuit Court against defendant. We will address additional facts that relate to the statute of limitations issue in our discussion in issue hi, infra.
i
Plaintiff first claims that the Saginaw Circuit Court erred in granting defendant’s motion for summary disposition. This issue is not properly before us. The instant appeal arises from the Tuscola Circuit Court’s grant of summary disposition, not that of the Saginaw Circuit Court. Plaintiff did not appeal the Saginaw Circuit Court order. Even if the issue were properly before us, we have not been provided with the record pertaining to the Saginaw Circuit Court proceeding. We will not review this argument. MCR 7.204(A)(1); MCR 7.210.
ii
Plaintiff next argues that the Saginaw Circuit Court’s grant of summary disposition to defendant was not an adjudication on the merits. We agree. This is a threshold argument to the statute of limitations question that we will consider next. According to the Saginaw Circuit Court order, "the Court did not base its decision on the merits of the case, but on the basis of the appellate decisions denying re-instatement [sic] of the original cause of action, thereby suggesting that this Court did not have jurisdiction to allow an amendment to the complaint to add Defendant fay quines, m.d.” The trial court did not review the merits of plaintiff’s case, but rather dismissed the case because it believed that it lacked jurisdiction. This was not an adjudication on the merits. Laude v Cossins, 334 Mich 622, 625-626; 55 NW2d 123 (1952).
hi
Plaintiff claims that the Tuscola Circuit Court erred in granting defendant summary disposition on the ground that the statutory period of limitation had allegedly run. The transcript of the hearing on defendant’s motion does not clearly indicate the trial court’s reasons for its decision.
Plaintiff’s claim against defendant accrued on June 20, 1981, the last day of treatment and the day plaintiff’s decedent died. However, a personal representative of the decedent’s estate was not appointed until June 15, 1983. The two-year statutory period of limitation applicable to medical malpractice actions, MCL 600.5805(4); MSA 27A.5805(4), MCL 600.5838; MSA 27A.5838, would have expired five days later, on June 20, 1983. MCL 600.5852; MSA 27A.5852, however, extended the limitation period:
If a person dies before the period of limitations has run or within 30 days after the period of limitations has run, an action which survives by law may be commenced by or against the executor or administrator of the deceased person or the claim may be proved as a debt against the estate of the deceased person, as the case may be, at any time within 2 years after letters testamentary or letters of administration are granted, although the period of limitations has run, subject to the limitations provided in section 20 of chapter 8 of Act No. 288 of the Public Acts of 1939, being section 708.20 of the Compiled Laws of 1948. But no executor or administrator shall bring an action under this provision unless he commences it within 3 years after the period of limitations has run. [Emphasis added.]
Thus, on the facts of this case, the period of limitation was extended until June 15, 1985. On May 21, 1985, plaintiff moved to add defendant as a party. On May 28, 1985, the Saginaw Circuit Court entered an order that allowed plaintiff to amend her complaint and name defendant as a party. Because plaintiff proceeded to secure the order that allowed the amendment within a reasonable time, the period of limitation was tolled from the date plaintiff moved to add defendant, May 21, 1985. Hall v Fortino, 158 Mich App 663; 405 NW2d 106 (1986). After defendant was joined as a party and the court acquired jurisdiction over defendant, the limitation period remained tolled. MCL 600.5856; MSA 27A.5856. During the Saginaw Circuit Court proceedings, then, twenty-five days remained on the limitation period, i.e., May 21, 1985, to June 15,1985.
After this Court reversed the Saginaw Circuit Court order that allowed plaintiff to set aside the dismissal, defendant moved for summary disposition. The motion was granted, and an amended order was entered on March 1, 1990, on which date the period of limitation began to run again. Plaintiff filed her Tuscola Circuit Court action against defendant on March 14, 1990, within the twenty-five days that remained in the limitation period after the Saginaw Circuit Court action was dismissed. With regard to the new action and the statute of limitations, the period of limitation was tolled during the time the Saginaw Circuit Court action was pending between plaintiff and defendant (and, earlier, during the period after the personal representative was appointed) because the Saginaw Circuit Court action was not adjudicated on the merits. Roberts v City of Troy, 170 Mich App 567, 581; 429 NW2d 206 (1988). See also issue ii, supra. The Tuscola Circuit Court action therefore was not barred by the statute of limitations.
We reject defendant’s argument that the period of limitation expired on June 15, 1985. Defendant claims that, because this Court reversed the March 5, 1985, order that set aside the dismissal, everything that occurred thereafter was "nullified,” including the addition of defendant as a party. Defendant provides no relevant authority for this proposition, and this Court will not search for authority to sustain or reject a party’s position. Consumers Power Co v Public Service Comm, 181 Mich App 261, 268; 448 NW2d 806 (1989). We note that, even though the order was later reversed, the Saginaw Circuit Court had acquired jurisdiction over defendant and that, after this Court reversed the order, defendant remained a party to the action and brought a motion for summary disposition, which was granted.
We conclude that the Tuscola Circuit Court erred in . granting summary disposition to defendant pursuant to MCR 2.116(C)(7).
Reversed.
A copy of the order was found in the Tuscola Circuit Court record.
We express no opinion with regard to the trial court’s reasoning. See issue i, supra.
We are somewhat troubled by one of the trial judge’s statements:
If I should rule in favor of the plaintiff in this matter, that means I go through a medical malpractice lawsuit, and six years from now find out that the defendant was right, that’s basically what’s going on here.
When ruling on the legal issue of the statute of limitations, the trial court should not have considered the factual validity of plaintiff’s claim or the convenience that a grant of summary disposition to defendant would afford the trial court.
We understand the three-year period referred to in MCL 600.5852; MSA 27A.5852 to be a limitation of the two-year extension allowed by the statute in cases where an executor or administrator is not appointed until more than three years after a statutory period of limitation has run. This case does not present that situation. | [
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Griffin, J.
We must decide whether distributions from a deferred compensation plan, paid to a nonresident, are subject to the state’s income tax if the original contributions to the plan represented earnings from employment in Michigan. Affirming a decision of the Court of Claims, the Court of Appeals ruled that distributions from such a plan are taxable. We affirm in part and reverse in part.
I
Plaintiff Molter, while a State of Michigan employee, participated in a deferred compensation plan qualified under § 457 of the Internal Revenue Code (irc). He began receiving distributions from his plan account in 1982, two years after his retirement. Pursuant to § 351 of the Michigan Income Tax Act, as amended (mita), MCL 206.1 et seq.) MSA 7.557(101) et seq., the State of Michigan withheld state income taxes from those distributions.
On January 1, 1983, plaintiff moved to Florida, and he has maintained his residency there since that date. Even though plaintiff moved, the state continued to withhold state income taxes from plaintiff’s distributions. Plaintiff protested the withholdings and requested an informal hearing. At that hearing, the referee denied plaintiff’s claim for a refund of the taxes.
Shortly thereafter, plaintiff initiated this action in the Court of Claims, contending that distributions made in accordance with the plan to nonresidents of deferred compensation and interest earned on deferred compensation are not taxable under the mita. In addition, plaintiff raised an equal protection claim, arguing that the Michigan Department of Treasury had made no effort to collect state income taxes on the deferred compensation of former residents who worked for private employers, but "has adopted the policy and practice of taxing the Deferred Income of only those non-residents who were formerly State Employees . . . .”
Upon cross motions for summary disposition, the Court of Claims determined that deferred com pensation and the interest earned on that compensation, paid to a retiree while a nonresident, are subject to the Michigan income tax. The court further determined that the Department of Treasury’s practice of withholding state income taxes only from former state employees violated the Equal Protection and Uniformity of Taxation Clauses of the Michigan Constitution. However, finding the department’s practice to be unintentional, the court awarded plaintiff no refund of past amounts withheld; instead, the department was enjoined from withholding state income taxes with respect to future distributions to plaintiff.
Both parties appealed, and the Court of Appeals agreed with the Court of Claims that both the deferred compensation and the interest earned on that compensation are taxable under Michigan law. However, the panel disagreed that plaintiff’s equal protection rights had been violated, concluding that "there is no failure to equally tax similarly situated entities. The only difference occurs in the time or method of collection.” 193 Mich App 421, 429-430; 484 NW2d 702 (1992).
We granted plaintiff’s application for leave to appeal. 441 Mich 878 (1992).
II
A deferred compensation plan implemented under § 457 of the irc permits an employee to set aside a portion of earnings in a savings program before those earnings are taxed. Section 457(a) provides that, for purposes of the federal income tax, compensation deferred under such a plan is not taxed in the year it is earned, but "shall be includible in gross income only for the taxable year in which such compensation or other income is paid or otherwise made available to the participant or other beneficiary.”
The mita adopts the federal definition of gross income and likewise imposes a tax on deferred compensation when it is disbursed to an employee. Section 28 of the mita provides: " 'Taxable income’ or 'net income’ means, unless specifically defined otherwise in this act, taxable income as defined in the internal revenue code for the subject taxpayer for federal income tax purposes . . . .”
Even though the mita adopts the federal definition of taxable income, the state and federal income tax schemes are not identical as applied to nonresidents of the State of Michigan. Under § 30(i) of the mita, a taxpayer’s income is subject to "[adjustments resulting from the allocation and apportionment provisions of chapter 3.” Pursuant to chapter 3, the income of a nonresident is allocated to this state if it is "earned, received, or acquired . . . [f]or the rendition of personal services performed in this state.” MCL 206.110(2)(a); MSA 7.557(1110)(2)(a).
Plaintiff contends that the distributions he has received since becoming a resident of Florida are not taxable under the mita because those payments have not been earned for the rendition of personal services performed in this state. Plaintiff presents two arguments in support of this proposition. First, he maintains that the distributions he has received from the plan represent investment income, not compensation for personal services rendered in the state. Second, plaintiff argues that even if the distributions represent compensation for services rendered, they do not represent compensation for any services rendered in the taxable year in which they were received. We shall consider each of these arguments in turn.
A
The state may impose a tax only if the tax is expressly authorized by law. The authority to tax will not be inferred. In re Dodge Bros, 241 Mich 665, 669; 217 NW 777 (1928); Detroit Hilton v Dep’t of Treasury, 422 Mich 422, 428; 373 NW2d 586 (1985); 3A Singer, Sutherland Statutory Construction (5th ed), § 66.01, p 1. Here, defendant finds authority to tax plaintiff’s deferred compensation in § 110(2) of the mita. As already noted, that section provides:
For a nonresident individual ... all taxable income is allocated to this state to the extent it is earned, received, or acquired, in 1 or more of the following ways:
(a) For the rendition of personal services performed in this state.
This section is unambiguous. It allocates to this state all of the taxable income of a nonresident that has been earned for work performed in Michigan. Even so, plaintiff argues that § 110(2) does not apply to distributions from a 457 plan. He maintains that the distributions he receives from the plan represent income earned on investments rather than income for the rendition of personal services. Because contributions were made to the plan under § 457, they became the property of the state; the state then invested the funds, and they are, and have been, subject to loss. Thus, plaintiff argues, funds in the plan are an investment, and the distributions he receives are simply returns on that investment. We disagree.
The money that plaintiff contributed to his 457 plan was a portion of the wages he received as an employee of the State of Michigan. It is undisputed that as a state employee he performed personal services in Michigan. Thus, his contributions clearly were earnings for "personal services performed in this state.” They did not cease to be compensation for personal services simply because disbursement was deferred or because they were invested before disbursement.
Closely analogous is the situation presented in Michaelsen v New York State Tax Comm, 67 NY2d 579; 505 NYS2d 585; 496 NE2d 674 (1986). In Michaelsen, the taxpayer, a resident of Connecticut, was granted options to buy stock at a certain price in connection with his employment in New York. He did not exercise those options when they were granted; rather, he exercised them several years later, presumably after the fair market value of the stock was greater than the option price.
In assessing the taxpayer’s New York income tax liability, the Michaelsen court followed the federal approach, and held that the income earned from the stock options was not recognized for tax purposes until the stock was sold. Moreover, the court determined that the delay between the realization of income from the stock option (the purchase of the stock) and the recognition of that income for tax purposes (the sale of the stock) had no effect on the authority of New York to tax the income, even though the compensation was invested during the delay. Instead, the court held that the income the nonresident taxpayer received when he sold the stock remained compensation "attributable to [the taxpayer’s] 'business, trade, profession or occupation carried on in [New York]’ and therefore taxable in New York . . . .’’Id. at 584. See also Pardee v New York State Tax Comm, 89 AD2d 294; 456 NYS2d 459 (1982) (the portion of a lump sum distribution from a nonresident employee’s profit-sharing plan that represented contributions made by the taxpayer’s employer was taxable as income by New York); Gosewisch v Dep’t of Revenue, 40 Pa Commw 565; 397 A2d 1288 (1979) (distributions from an employee profit-sharing plan were treated as compensation for services rendered in the year received, not as income from the disposition of personal property).
Likewise, the deferred compensation set aside by plaintiff in this case remains income for the rendition of personal services performed in Michigan, even though it was contributed to a 457 plan.
B
Plaintiff alternatively argues that, even if the distributions represent compensation for services rendered, they do not represent compensation for any services rendered in the taxable year in which they were received. Plaintiff maintains that he cannot be required to pay state income taxes on distributions unless he works in Michigan during the year in which the distributions are received.
For support, plaintiff relies on Destito v Comm’r of Revenue, 23 Mass App 977; 503 NE2d 986 (1987); There, the plaintiff was employed for many years at a federal military base in Massachusetts. Throughout his employment, he was a resident of New Hampshire. Just over a year before his retirement, the plaintiff became ill and did not work for fourteen months. Subsequently, he retired and received a lump sum representing accumulated sick pay and annual leave time. Massachusetts attempted to tax the lump sum, but the court determined that it was not taxable in Massachusetts. Although this lump-sum disbursement represented benefits accumulated as a result of the plaintiff’s labor in Massachusetts, the court held that the year in which those benefits were paid was dispositive: "Section 5A [of the Massachusetts act] does not expressly tax a nonresident’s income from employment if in the taxable year of its receipt the nonresident has not worked in Massachusetts.” Id. at 978. Because the plaintiff did not work in Massachusetts during the year in which the lump sum was paid to him, it was not taxable.
Plaintiff here urges this Court to adopt the logic and analysis of the Massachusetts court. He maintains that no services were performed in Michigan after he became a Florida resident in 1983; thus, none of the income received after January 1, 1983, is properly allocable to Michigan as income earned here. Again, we disagree.
As above noted, the mita defines taxable income in reference to federal taxable income. MCL 206.28; MSA 7.557(128). Moreover, § 2 of the mita provides:
(2) Any term used in this act shall have the same meaning as when used in comparable context in the laws of the United States relating to federal income taxes unless a different meaning is clearly required. Any reference in this act to the internal revenue code shall include other provi sions of the laws of the United States relating to federal income taxes.
(3) It is the intention of this act that the income subject to tax be the same as taxable income as defined and applicable to the subject taxpayer in the internal revenue code, except as otherwise provided in this act. [MCL 206.2; MSA 7.557(102).]
In light of the clear legislative intent to adopt the federal approach to calculating taxable income, we conclude that the mita authorizes taxation of income received in one year for services rendered in an earlier year, just as the irc authorizes taxation of income received in one year but earned in an earlier year. Deferred compensation is considered taxable income under the irc in the year that it is disbursed to an employee. Thus, it is taxable income for purposes of the mita in that same year.
Indeed, an attempt to tax deferred compensation before a taxpayer is entitled to that compensation would run afoul of the established rule that "for a cash basis taxpayer, income is realized, and hence taxable, when actually or constructively received.” Wackerman v Michigan, 47 Mich App 228, 234; 209 NW2d 493 (1973); see also Cook v Dep’t of Treasury, 396 Mich 176, 182; 240 NW2d 247 (1976). Here, the deferred compensation was not actually or constructively received before plaintiff’s retirement. Further, under the terms of the plan, none of the contributions made to the deferred compensation plan were available to a participant before retirement or termination of employment except in the event of "extreme financial emergency.” For these reasons, we agree with the lower courts that the distributions paid to plaintiff representing contributions he made to a deferred compensation plan are taxable income under the mita in the year they are received.
III
Plaintiff next contends that even if the amount of his disbursements representing deferred compensation is taxable, the amount of his disbursements representing interest earned on that compensation is not taxable. He argues that the interest income of a nonresident is not taxable by Michigan, regardless of its source. Plaintiff cites § 113 of the mita, which provides:
Interest and dividends are allocable to this state if the taxpayer is a resident . . . individual of this state or has a commercial domicile in this state. [Emphasis added.]
The Court of Appeals rejected plaintiff’s argument. Agreeing with the Court of Claims, the panel held: "[I]nterest that accrued on the contributions to the 457 plan while plaintiff was a resident of Michigan was subject to Michigan income tax, despite the fact that it was distributed while plaintiff was a resident of Florida.” 193 Mich App 427. The panel found authority for its conclusion in § 113 of the mita, which, according to the panel, "governs interest accrued while a resident . . . .” Id. (Emphasis added.)
Although we agree with the Court of Appeals that deferred compensation originally earned for the rendition of personal services is taxable income as defined in the mita, we disagree that the act provides authority for taxing the interest income of a nonresident, whatever its source. As already noted, the authority to tax will not be inferred, but must be expressly provided in the constitution or by statute:
Tax exactions, property or excise, must rest upon legislative enactment, and collecting officers can only act within express authority conferred by law. Tax collectors must be able to point to such express authority so that it may be read when it is questioned in court. The scope of tax laws may not be extended by implication or forced construction. Such laws may be made plain, and the language thereof, if dubious, is not resolved against the taxpayer. [In re Dodge Bros, supra, 241 Mich 669.]
As we read the plain language of § 113, we see no authority to tax the interest income of a nonresident. This section does not set forth the taxability of interest that accrues while one is a resident; instead, it simply addresses the proper allocation of taxable interest income received by a taxpayer in a given tax year. In conjunction with § 110, §113 allocates taxable interest income to this state "if the taxpayer is a resident.”
Under § 457 of the irc, interest earned by the principal in a 457 plan is not taxable income in the year that it accrues. Rather, it is taxable income "only for the taxable year in which such [interest] is paid or otherwise made available to the participant or other beneficiary.”
Here, according to his complaint, plaintiff did not receive any of the interest earned by the principal in his 457 plan account before he became a Florida resident. In addition, none of the funds in his account were "otherwise made available” to him before he actually received them. The terms of the plan specified that none of the amount in plaintiff’s plan account was available for plaintiff’s use before his retirement or termination of employment except in the event of "extreme financial emergency.”
Accepting plaintiff’s allegations as true, we conclude that he would have no state income tax liability on his interest income under § 113 of the mita. To be allocable to this state, interest income must be received or actually available to a taxpayer while he is a resident.
Further, we disagree with the dissent that interest earned on deferred compensation is taxable under § 110 of the mita. The dissent reaches its conclusion on the basis that the interest earned on deferred compensation is not "true interest,” post, p 558; rather, it is "income attributable to services rendered within the state . . . .’’Id. at 557. The dissent contends, therefore, that interest income is taxable under § 110 of the mita as compensation for the rendition of personal services, as if it were wages paid to an employee by an employer.
As authority for its argument, the dissent relies on the following language in § 457 of the irc:
"[A]ny amount of compensation deferred under the plan, and any income attributable to the amounts so deferred, shall be includible in gross income only for the taxable year in which such compensation or other income is paid . . . [Post, pp 556-557.]
This language is read to mean that "any contributions to a § 457 plan, as well as any capital gains or interest earned thereon, are part of the corpus that is taxable for federal purposes.” Post, p 557.
We do not quarrel with this conclusion, because it is obvious that the federal government treats interest earned on deferred compensation as part of a taxpayer’s gross income. However, we fail to see how that fact supports the conclusion the dissent extrapolates from the language of § 457— that the interest earned on deferred compensation should be treated under the mita as compensation for personal services rendered in this state instead of as interest earned on an investment.
Federal taxable income is a broad category that includes income from "whatever source derived.” See IRC, §§ 61, 63. Under the irc, both compensation for services and interest income are treated as taxable income. In contrast, the mita does not include interest income as part of a nonresident taxpayer’s income. Instead, as explained above, the mita allocates to this state only that portion of a nonresident’s income that is earned for the rendition of personal services in this state. Thus, to conclude that a particular source of income is taxable in Michigan simply because it is "part of the corpus that is taxable for federal purposes,” ignores the allocation and apportionment provisions of the mita. Post, p 557.
Nothing in the irc, or in the arguments presented in this appeal, persuades us that the interest plaintiff earned on his deferred compensation should be treated as compensation attributable to services performed in this state. Contrary to the assertion of the dissent, interest does not transform and become compensation for services rendered simply because its disbursement is delayed, any more than, as plaintiff earlier claimed, deferred compensation transforms and becomes interest simply because its disbursement is delayed. Each represents a "distinct accretion” to a taxpayer’s income, and it is clear that the Legislature intended to treat each accretion differently. Compensation for personal services rendered in Michigan is taxable regardless of the residency of the taxpayer; interest income is not taxable under the mita if the taxpayer is not a resident during the year in which he receives the interest.
IV
Plaintiff’s remaining claim is a constitutional challenge to the collection procedures of the Department of Treasury. He contends that the department does not treat all former residents who receive distributions from deferred compensation plans equally. Former residents who worked for the state find that state income taxes are withheld from their distributions, but former residents who worked for private employers have no state income taxes withheld from their distributions. Plaintiff further argues that the state makes no effort to collect income taxes from nonresidents receiving distributions from private employer deferred compensation plans, effectively forgiving the tax on those nonresidents. Thus, "the effect of this policy and practice is that only former State employees are taxed.”
Plaintiff contends that the state’s practice violates the Uniformity of Taxation Clause in the Michigan Constitution:
Every tax other than the general ad valorem property tax shall be uniform upon the class or classes on which it operates. [Const 1963, art 9, § 3.][ ]
Under this clause, "the controlling principle is one of equal treatment of similarly situated taxpayers.” Armco Steel v Dep’t of Treasury, 419 Mich 582, 592; 358 NW2d 839 (1984). Plaintiff argues here that similarly situated taxpayers — nonresidents receiving distributions from deferred compensation plans — are not being treated equally. Former state employees who now are nonresidents are being taxed, while other nonresidents are not being taxed.
The Court of Appeals rejected plaintiff’s equal protection claim. Reversing a ruling of the Court of Claims, the panel held that
both the 457 plan [in which plaintiff participated] and the deferred compensation plans offered by private employers are subject to Michigan income tax. The only difference between the two is the mechanism of collection. Under the 457 plan, defendant is withholding the income tax before the deferred compensation is distributed. Under the deferred compensation plans offered by private employers, the employers are not withholding the tax at the time of disbursement and consequently the burden lies with the recipient to report the income when filing an income tax return and to then pay what is due and owing in tax. [193 Mich App 429.]
We agree with the analysis of the Court of Appeals.
The withholding requirements of the mita are determined by several interrelated provisions of that act and the irc. A brief review of these sections is instructive.
Section 351 of the mita provides:
Every employer in this state required under the provisions of the internal revenue code to withhold a tax on the compensation of an individual except as otherwise provided shall deduct and withhold a tax in an amount computed by applying, except as provided by subsection (7), the rate prescribed in section 51 to the remainder of the compensation after deducting therefrom the same proportion of the total amount of personal and dependency exemptions of the individual allowed under this act .... [Emphasis added.]
Section 6(3) of the mita defines compensation as "wages as defined in section 3401 and other payments as provided in section 3402 of the internal revenue code.”
Section 3401 of the irc distinguishes between deferred compensation received under 457 plans (public and nonprofit employers) and compensation received through plans of private employers (e.g., plans implemented under § 401[a]). Although § 3401 defines wages as "all remuneration ... for services performed by an employee for his employer,” it excludes from that definition of wages any remuneration paid from plans under §§ 401(a), 402(h)(1), and 403(a). Withholding from these distributions is governed by § 3405 of the irc.
The state’s withholding scheme for the. several types of deferred compensation plans is consistent with the irc, which requires withholding for 457 plans but not for 401(a) plans. See 26 CFR 35.3405-1.
Although withholding is required in connection with 457 plans but is not required in connection with certain other deferred compensation plans, we are not persuaded that this difference violates the principle of equal treatment of similarly situated taxpayers. As stated by the Court of Appeals, "both the 457 plan and the deferred compensation plans offered by private employers are subject to Michigan income tax.” 193 Mich App 429.
The State of Michigan has not adopted a policy forgiving the tax imposed on former residents who are receiving distributions from private deferred compensation plans. As noted by the state during oral argument, withholding is simply one method of collecting income taxes, but a failure to withhold taxes does not negate the underlying tax liability. Further, employing different methods to collect a tax does not render the tax unconstitutional under the Uniformity of Taxation Clause. As the Court of Appeals explained:
The constitutional requirement of uniformity of taxation is concerned with uniformity of rates and assessment and not with uniformity in the time of collection. Harper Creek School Dist v LeRoy Twp Supervisor, 146 Mich App 515, 535; 382 NW2d 172 (1985). Uniformity as used in the Michigan Constitution simply guarantees equality of the tax burden. Plymouth Twp v Wayne Co Bd of Comm’rs, 137 Mich App 738, 749; 359 NW2d 547 (1984). [193 Mich App 429; see also Huron-Clinton Metropolitan Authority v Bds of Supervisors, 304 Mich 328, 335-336; 8 NW2d 84 (1943).]
Because the state income tax applies equally to all former residents who receive deferred compensation, we hold that plaintiff’s equal protection rights have not been violated by the state’s practice of withholding income taxes from his deferred compensation plan distributions.
V
For the foregoing reasons, we affirm the decision of the Court of Appeals in all respects except as it applies to the distribution of interest in plaintiff’s 457 plan account. We reverse the decision to the extent that it would require payment of the state income tax on such interest received by plaintiff while a nonresident. The case is remanded to the Court of Claims for further proceedings consistent with this opinion.
Cavanagh, C.J., and Levin, Brickley, and Boyle, JJ., concurred with Griffin, J.
26 USC 1 et seq.
Section 351(1) provides, in part:
Every employer in this state required under the provisions of the internal revenue code to withhold a tax on the compensation of an individual, except as otherwise provided, shall deduct and withhold a tax ....
Under § 3401, federal income taxes also are withheld from distributions from a § 457 deferred compensation plan.
Plaintiff’s motion for summary disposition was filed pursuant to MCR 2.116(C)(8); defendant’s motion for summary disposition was filed pursuant to MCR 2.116(0(10).
Const 1963, art 1, § 2, art 9, § 3.
Section 110(2)(b), not applicable to this case, also allocates nonresident income to this state if it is
a distributive share of the net profits of a business, profession, enterprise, undertaking, or other activity as the result of work done, services rendered, or other business activities conducted in this state, except as allocated to another state pursuant to the provisions of sections 111 to 114 and subject to the credit provisions of section 256.
Under the irc, the taxable income attributable to a stock option is the difference in value between the market price of the stock and the option price of the stock when the option is exercised. Id. at 583. However, as with deferred compensation, this income is not recognized for federal tax purposes until actually received, i.e., when the stock is sold. Id.
Deferred Compensation Plan Regulations, § 8.2(C).
Plaintiff contends in his complaint that his contributions to the plan were exhausted by March 1,1986, and that all distributions paid to him after that date reflect interest earned by the principal.
See also 26 CFR 1.457-1. Funds in a 457 plan are not considered "available” for federal income tax purposes merely because the taxpayer chooses among various investment modes or elects to receive those funds in monthly installments.
Our approach is consistent with the approach taken by courts in New York, which have refused to tax interest income of nonresidents that was earned on employee benefits such as profit-sharing plans or stock options, even though the benefits themselves were taxed as compensation. See Pardee and Michaelsen, supra.
See Michaelsen, supra, 67 NY2d 584.
We are likewise unpersuaded by the reasoning of the New Jersey tax court in McDonald v Director, Div of Taxation, 10 NJ Tax 556 (1989), modified on other grounds 247 NJ Super 326; 589 A2d 186 (1991). Although the issue in McDonald was similar to the issue presented here, the New Jersey income tax law differs significantly from the mita. In contrast to the mita, the New Jersey tax statute allocates nonresident income to New Jersey if it is " '[compensation, net profits, gains, dividends, interest or income’ ” that is " 'earned, received or acquired from sources within this State.’ ” Id. at 330. (Emphasis supplied.) The relevant tax law of New Jersey is much broader than the mita; thus, cases interpreting New Jersey law are of little guidance when interpreting the mita.
As a practical matter, in cases involving taxing statutes, there is no discernible difference between the Equal Protection and Uniformity of Taxation Clauses. [Armco Steel v Dep’t of Treasury, 419 Mich 582, 592; 358 NW2d 839 (1984).] | [
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Per Curiam.
In these cases, the defendants attempted to invoke the doctrine of forum non conveniens. In one action, the circuit court granted a motion to decline jurisdiction; in the other, such a motion was denied. On appeal, the Court of Appeals treated the doctrine as inapplicable on the ground that the corporate defendants are residents of Michigan. Because the doctrine is not subject to such a limitation, we remand these cases to the Court of Appeals for further consideration.
I
In Russell v Chrysler Corp, plaintiff Thomas P. Russell was seriously injured in a January 16, 1986, accident in the State of Florida. He was working on a 1984 Chrysler when the car appar ently slipped into gear. It moved forward and struck Mr. Russell, causing serious injury.
On January 6, 1989, Mr. Russell and his spouse filed suit against Chrysler Corporation in the Wayne Circuit Court. The complaint alleged that the Russells are residents of Florida, and that Chrysler Corporation is a Michigan corporation whose principal place of business is this state.
The circuit court granted Chrysler’s motion to decline jurisdiction under the doctrine of forum non conveniens.
The Russells appealed, and the Court of Appeals reversed the order of the circuit court. The reversal was premised upon Witt v CJ Barrymore’s, 195 Mich App 517; 491 NW2d 871 (1992), in which the Court of Appeals held the doctrine of forum non conveniens to be inapplicable where one or more of the parties are residents of the forum state. The Court said that, "[bjecause the defendant in this case is a resident of Michigan, we have no choice but to reverse the decision of the trial court.”
The Court of Appeals denied rehearing. It also denied a petition to convene a special panel under Administrative Order No. 1990-6, 436 Mich lxxxiv to reconsider Witt.'
Chrysler has now filed an application for leave to appeal in this Court.
II
McCorkle v General Motors Corp, arises from an accident that occurred on November 27, 1989, just after midnight. Alicia McCorkle was involved in a serious one-car accident in the State of Florida.
Ms. McCorkle sued General Motors Corporation on December 9, 1991, in the Wayne Circuit Court. She alleged that she was a resident of the State of Florida, and that General Motors has its residence, principal place of business, and world headquarters in Michigan.
General Motors moved to dismiss the complaint on the basis of forum non conveniens. The circuit court denied the motion.
General Motors applied to the Court of Appeals for leave to appeal, which the Court denied. However, two of the three judges on the panel stated "that they are following Witt v CJ Barrymore’s, 195 Mich App 517 (1992), only because they are bound by Administrative Order 1990-6 to do so.”
General Motors then petitioned the Court of Appeals to convene a special panel for the purpose of overruling Witt, but the Court denied the petition.
General Motors applies for leave to appeal.
III
In Duyck v Int’l Playtex, Inc, 144 Mich App 595; 375 NW2d 769 (1985), the parties were disputing whether venue should be laid in the Wayne Circuit Court or the Macomb Circuit Court. In the course of deciding that question, the Court of Appeals offered the following dictum:
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. [144 Mich App 602-603.]
That dictum from Duyck was applied in Witt, where the circuit court had declined jurisdiction on the basis of foriim non conveniens. Again, the Court of Appeals stated that the doctrine of forum non conveniens is inapplicable if one of the parties is a resident of Michigan. 195 Mich App 520.
This statement from Duyck and Witt is not correct. The leading case on forum non conveniens in Michigan is Cray v General Motors Corp, 389 Mich 382; 207 NW2d 393 (1973); 59 ALR3d 127. The principal question in Cray was whether the doctrine was to be part of Michigan law. This Court agreed that it should be and that its application should lie within the discretion of the trial judge.
In Cray, this Court affirmed orders entered by the circuit court in four separate cases. In each, the court had denied a motion to decline jurisdic tion of a suit against General Motors. Nothing in the Cray opinion suggests that the doctrine is inapplicable where one of the parties is a resident of the State of Michigan.
Indeed, this Court cited in Cray, with apparent approval, a New York decision in which the court overruled precedent holding that a trial court could not refuse jurisdiction if either party were a resident of New York. This Court explained, "Residency became one factor to be considered but was no longer a controlling factor.” 389 Mich 394. This Court also discussed, again with apparent approval, a New Jersey decision in which the doctrine of forum non conveniens was applied to the benefit of a defendant that was incorporated in New Jersey. 389 Mich 392.
To aid trial judges in determining whether to decline jurisdiction, this Court summarized its views in this fashion:
The following criteria are suggested by precedent and specifically from the cases cited [in Cray], although as stated in Gulf Oil Corp v Gilbert [330 US 501, 508; 67 S Ct 839; 91 L Ed 1055 (1947)], "Wisely it has not been attempted to catalogue the circumstances which will justify or require either grant or denial of remedy. The doctrine leaves much to the discretion of the court to which the plaintiff resorts, and experience has not shown a judicial tendency to renounce one’s own jurisdiction so strong as to result in many abuses.” . . .
A balancing out and weighing of factors to be considered in rejecting or accepting jurisdiction in such cases should include:
1. The private interest of the litigant.
a. Availability of compulsory process for attendance of unwilling and the cost of obtaining attendance of willing witnesses;
b. Ease of access to sources of proof;
c. Distance from the situs of the accident or incident which gave rise to the litigation;
d. Enforceability of any judgment obtained;
e. Possible harassment of either party;
f. Other practical problems which contribute to the ease, expense and expedition of the trial;
g. Possibility of viewing the premises.
2. Matters of public interest.
a. Administrative difficulties which may arise in an area which may not be present in the area of origin;
b. Consideration of the state law which must govern the case;
c. People who are concerned by the proceeding.
3. Reasonable promptness in raising the plea of forum non conveniens.
The courts are charged to consider the plaintiff’s choice of forum and to weigh carefully the relative advantages and disadvantages of jurisdiction and the ease of and obstacles to a fair trial in this state. [Cray, 389 Mich 395-396.]
Implicit in such a list of factors is consideration of the location of the parties. Equally clear is the absence from this Court’s analysis of a rule rendering forum non conveniens inapplicable where one party is a resident of this state.
This Court again considered forum non conveniens in Anderson v Great Lakes Dredge & Dock Co, 411 Mich 619; 309 NW2d 539 (1981). However, Anderson gives no hint that the doctrine is inapplicable whenever one of the parties is a resident of the State of Michigan.
The Court of Appeals has clearly expressed reservations about the rule of Duyck/Witt. Robey v Ford Motor Co, 155 Mich App 643, 646; 400 NW2d 610 (1986); McLarty v Kubota Tractor, Ltd, 173 Mich App 82, 85-86; 433 NW2d 344 (1988). And in the earlier decision of Hamann v American Motors Corp, 131 Mich App 605; 345 NW2d 699 (1983), the Court affirmed a dismissal under forum non conveniens though the corporate defendant was headquartered in Michigan and maintained its principal place of business here.
As indicated above, the location of the parties is inescapably an element of the analysis as a court applies the considerations listed in Cray. We continue to believe that a court can and must consider the residence of the parties in deciding whether to decline jurisdiction. And we remain equally persuaded that a party’s Michigan residence does not automatically render the doctrine of forum non conveniens inapplicable.
IV
The dictum that was stated in Duyck, and that was later adopted in Witt, is not consistent with the principles stated and applied by this Court in Cray. Accordingly, we vacate the judgment of the Court of Appeals in Russell and remand this case to the Court of Appeals for reconsideration of the plaintiffs’ appeal. In McCorkle, we remand the case to the Court of Appeals for consideration of the defendant’s appeal as on leave granted. MCR 7.302(F)(1).
Cavanagh, C.J., and Levin, Brickley, Boyle, Riley, Griffin, and Mallett, JJ., concurred.
These cases have not yet been tried. For present purposes, we are accepting as true the allegations found in the plaintiffs’ complaints.
In its answer to the Russells’ complaint, Chrysler said that it is a Delaware corporation with its principal place of business in Michigan.
Unpublished memorandum opinion of the Court of Appeals, decided December 1, 1992 (Docket No. 129839).
After saying that it had "no choice but to reverse the decision of the trial court,” the Court of Appeals cited Administrative Order No. 1990-6, 436 Mich lxxxiv, perhaps implying that the panel had reservations about the rule of Witt.
Unpublished order of the Court of Appeals, entered February 5, 1993 (Docket No. 129839).
Administrative Order No. 1990-6 remains in effect, having been extended by Administrative Order No. 1991-11, 439 Mich cxliv, Administrative Order No. 1992-8, 441 Mich cxi, and Administrative Order No. 1993-4, 442 Mich cxiii.
Unpublished order of the Court of Appeals, entered March 10, 1993 (Docket No. 159929).
Unpublished order of the Court of Appeals, entered March 5, 1993 (Docket No. 159916).
Unpublished order of the Court of Appeals, entered May 21, 1993 (Docket No. 162809).
General Motors has also filed a motion for immediate consideration, which is granted.
Because the defendant in the Cray cases was the same defendant who is before us today in McCorkle, this Court could certainly have abbreviated its analysis if it believed that General Motors, as a "resident” of Michigan, was ineligible to seek a dismissal under the doctrine of forum non conveniens.
Silver v Great American Ins Co, 29 NY2d 356; 328 NYS2d 398; 278 NE2d 619 (1972).
Gore v United States Steel Corp, 15 NJ 301, 303; 104 A2d 670; 48 ALR2d 841 (1954), cert den 348 US 861 (1954).
See also Manfredi v Johnson Controls, Inc, 194 Mich App 519; 487 NW2d 475 (1992), involving a defendant that had a manufacturing plant in Michigan. There, the Court of Appeals considered the Cray factors without regard to the fact that the defendant had a plant in Michigan. | [
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Riley, J.
Because MCL 600.1629; MSA 27A.1629 provides that venue for a legal malpractice action resides in the county in which the alleged malpractice occurred and not the county in which an underlying legal action would have resided, we reverse the decision of the Court of Appeals.
I
On April 29, 1987, plaintiff Carol D. Coleman, a resident of Washtenaw County, was discharged from her employment with the Detroit Public Schools after twenty-three years of service. Plaintiff subsequently consulted with defendant E. Donald Gurwin, an attorney, for legal advice regarding a potential wrongful discharge action against the school system. After four meetings at his Oakland County office, defendant informed plaintiff by letter that he would not represent her in such a suit because he did not believe that her suit was meritorious.
On May 9, 1990, plaintiff filed suit against defendant in Wayne Circuit Court, alleging legal malpractice. Plaintiff claimed that defendant’s letter declining representation negligently provided erroneous advice regarding the applicable statute of limitations, thereby inducing her to forgo a meritorious wrongful discharge action until after the expiration of the period of limitation.
On June 29, 1990, defendant moved for a change of venue on the basis that venue was improperly laid in Wayne County. Defendant maintained that because the alleged legal malpractice occurred solely in Oakland and Washtenaw Counties that venue properly belonged in either of those counties. The trial court rejected the motion and ruled that because the underlying wrongful discharge action arose in Wayne County and defendant conducts business there, venue was properly laid. The Court of Appeals affirmed. 195 Mich App 8; 489 NW2d 118 (1992).
This Court granted leave to appeal.
II
"In legal phraseology 'venue’ means the county where a cause is to be tried, and originally a venue was employed to indicate the county from which the jury was to come.” Sullivan v Hall, 86 Mich 7, 13; 48 NW 646 (1891). This Court has long recognized that the establishment of venue is properly within the Legislature’s power. Barnard v Hinkley, 10 Mich 458, 459 (1862).
Because an action for legal malpractice is a tort, venue in the instant case is controlled by MCL 600.1629(l)(a)(i); MSA 27A.1629(l)(a)(i). The statute in pertinent part provides for venue in "[a] county in which all or a part of the cause of action arose and in which either . . . [t]he defendant resides, has a place of business, or conducts business in that county.” The primary foci of the statute are to ensure that venue "is proper where part or all of the cause of action arose,” Lorencz v Ford Motor Co, 439 Mich 370, 377; 483 NW2d 844 (1992), and "that the action be instituted in a county where the defendant has some real presence such as might be shown by systematic or continuous business dealings inside the county.” Marposs Corp v Autocam Corp, 183 Mich App 166, 172; 454 NW2d 194 (1990).
To determine whether the legal malpractice claim arose at least in part in Wayne County, the elements, i.e., the "parts,” of the action must be examined. In an action for legal malpractice, the plaintiff has the burden of proving:
(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. See, e.g., Basic Food Industries, Inc v Grant, 107 Mich App 685, 690; 310 NW2d 26 (1981).
Hence, a plaintiff in a legal malpractice action must show that but for the attorney’s alleged malpractice, he would have been successful in the underlying suit. Our Court of Appeals explained:
"The recovery sought is usually the value of the claim in suit in the proceeding in which the negligent act occurred, if the client was a plaintiff in that action, or, if he was a defendant, the amount of the judgment imposed upon him, and, in accordance with general rules as to proximate cause, it is generally held that before such recovery can be had the client must establish that, absent the act or omission complained of, the claim lost would have been recovered or the judgment suffered avoided. Accordingly, the client seeking recovery from his attorney is faced with the difficult task of proving two cases within a single proceeding.” [Basic Food, supra at 691, quoting 45 ALR2d 5, § 2, p 10.[ ]
However, this " 'suit within a suit’ concept has vitality only in a limited number of situations, such as where an attorney’s negligence prevents the client from bringing a cause of action (such as where he allows the statute of limitations to run), where the attorney’s failure to appear causes judgment to be entered against his client or where the attorney’s negligence prevents an appeal from being perfected.” Id. at 693. This is so because the purpose of the ''suit-within-a-suit requirement is to insure that the damages claimed to result from the attorney’s negligence are more than mere speculation.” Charles Reinhart Co v Winiemko, 196 Mich App 110, 115; 492 NW2d 505 (1992).
Plaintiff contends that because she must prove that her underlying wrongful discharge cause of action would have been successful to prevail in the instant suit, venue is proper in Wayne County because that would have been the forum of the wrongful discharge action. Defendant, on the other hand, maintains that no part of the legal malpractice claim arose in Wayne County because the attorney-client relationship was established in Oakland County, the attorney-client meetings occurred in Oakland County, the allegedly negligent advice was drafted and mailed in Oakland County and received in Washtenaw County, and plaintiff is a resident of Washtenaw County.
A fundamental principle guiding this Court is that a clear and unambiguous statute leaves no room for judicial construction or interpretation. People v Plumsted, 2 Mich 465, 469 (1853). If, however, judicial interpretation is proper, then this Court must determine the Legislature’s intent employing " 'a reasonable construction considering its purpose and the object sought to be accomplished.’ Additionally, it is the primary objective in statutory interpretation and construction to effectuate legislative intent without harming the plain wording of the act.” Lorencz, supra at 377 (citation omitted). Adherence to the language and legislative intent of a statute is essential to ensure that "courts . . . declare the sense of the law” and do not "exercise will instead of judgment . . . .” Hamilton, The Federalist Papers, No 78, Kramnick, ed (England: Penguin Books, 1987 [originally published in 1788]), p 440.
The statute at issue clearly and unambiguously indicates that venue rests for a tort action only in "[a] county in which all or a part of the cause of action arose . . . .” The "suit within a suit,” however, is not a part of a legal malpractice action in and of itself. A legal malpractice action and the litigation or representation from which it arose, of course, are distinct. Nor is recovery in a particular venue necessary to a legal malpractice action, but rather that an underlying suit was meritorious. Although evidence of an underlying suit may be necessary to prove proximate cause and damages, because legal malpractice is a separate cause of action, venue is determined by the location of the primary suit,. i.e., where the alleged legal negligence occurred. The venue of the "suit within a suit” is not a part of the legal malpractice cause of action, therefore, it may not direct the venue of the legal malpractice action. A legal malpractice action arises solely in the county where the allegedly negligent legal representation occurred. The Court of Appeals, therefore, erred by holding that the venue of the "suit within a suit” controls the venue of a legal malpractice claim.
Hence, in the instant case, venue in Wayne County is improper. Plaintiff, of course, may not sustain a cause of action for legal malpractice until she alleges all the elements of that tort. Plaintiff’s allegations were: retaining the attorney to advise her about the conditions under which her employment was terminated, the attorney’s allegedly negligent advice about both the Detroit Public Schools’ potential liability and the statute of limitations, and the eventual running of the statute of limitations, which prevented her from bringing an action for wrongful discharge. Not one of the parts of the cause of action for legal malpractice occurred in Wayne County; the plaintiff retained the attorney in Oakland County, the advice was given in Oakland County and received in Washtenaw County, and the statute of limitations ran while the plaintiff lived in Washtenaw County. Plaintiff’s action did not arise in whole or in part in Wayne County because defendant’s alleged malpractice occurred outside of the county. Although the underlying litigation would have occurred in Wayne County, the actual suit at issue — the legal malpractice between plaintiff and defendant — is premised solely on allegedly negligent advice given on soil beyond the boundaries of Wayne County. The decision of the Court of Appeals, therefore, is reversed.
III
Because MCL 600.1629; MSA 27A.1629 provides that venue for a legal malpractice action resides in the county in which the alleged malpractice occurred and not the county in which an underlying legal action would have resided, we reverse the decision of the Court of Appeals.
Cavanagh, C.J., and Levin, Brickley, Boyle, Griffin, and Mallett, JJ., concurred with Riley, J.
The letter was drafted and mailed from Oakland County to plaintiff’s home in Washtenaw County.
Detroit is located in Wayne County.
See also Lorencz v Ford Motor Co, 439 Mich 370, 375; 483 NW2d 844 (1992) (holding that venue is proper in any county where part of the cause of action arose).
See also 2 Martin, Dean & Webster, Michigan Court Rules Practice (3d ed, 1992 Supp), p 20.
The standard of care for an attorney was established in Eggleston v Boardman, 37 Mich 14, 16 (1877):
Whenever an attorney or solicitor is retained in a cause, it becomes his implied duty to use and exercise reasonable skill, care, discretion and judgment in the conduct and management thereof.
See also Babbitt v Bumpus, 73 Mich 331; 41 NW 417 (1889).
It is well established that in Michigan the burden is on the plaintiff to establish only that the defendant’s negligence is a proximate cause of the plaintiff’s damages. [Ignotov v Reiter, 425 Mich 391, 400; 390 NW2d 614 (1986) (Boyle, J„ concurring). Emphasis in original. See also id. at 402, n 1 (Riley, J., dissenting).]
See also 2 Mallen & Smith, Legal Malpractice (3d ed), § 27.8, p 646 ("The objective of the [suit within a suit] concept is to establish causation, i.e., that the attorney’s negligence caused injury”). See also Sherry v Diercks, 29 Wash App 433, 437; 628 P2d 1336 (1981) ("To establish the element of proximate causation in a legal malpractice action based on the claim of an attorney’s failure to defend, the client must establish in a 'suit within a suit’ that if the action had been defrauded, the client would have prevailed or achieved a better result in that action”); Lewandowski v Continental Casualty Co, 88 Wis 2d 271, 277; 276 NW2d 284 (1979) ("The requirements of causation dictate that the merits of the malpractice action depend upon the merits of the original claim”).
The Court of Appeals agreed: "In such cases, the underlying action constitutes at least a part of the cause of action for legal malpractice. Venue would therefore be proper in the county where the underlying action occurred . . . .” 195 Mich App 12.
The second requirement of the statute, that the “defendant resides, has a place of business, or conducts business in that county” is uncontested because defendant admits performing legal services in Wayne County.
MCL 600.1629(l)(a); MSA 27A.1629(l)(a).
In fact, because legal malpractice claims are distinct suits from the underlying cause of action, the nature and measure of damages may be different. Lowan v Karp, 190 Mich App 448, 452; 476 NW2d 428 (1991), quoting 2 Mallen & Smith, Legal Malpractice (3d ed), § 17.15, pp 58-59. | [
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Riley, J.
In the present case, plaintiff seeks the discharge of a mortgage as well as damages for slander of title. Defendant was the holder of the real estate mortgage that defendant foreclosed by advertisement. Defendant asserts a claim against the property in the amount it paid to redeem the property from a construction lien foreclosure sale. We find that plaintiff has complied with the clear language of the redemption statute and that defendant is not entitled to a lien on the property in the amount it paid to redeem the property from a prior foreclosure sale. The decision of the Court of Appeals is reversed.
I
This case was presented to the trial court on a stipulation of facts. In May 1984, a mortgage on the premises was executed between Paul and Yvonne Farmwald and Lambrecht & Company. This mortgage was subsequently assigned to defendant. In February 1988, Cross Pointe, Inc., the successors in interest to the Farmwald property, conveyed a less-than-fee interest to plaintiff pursuant to a land contract. Plaintiff paid $22,500 for the property, with $52,000 owing on the land contract.
Judgments of foreclosure were entered pursuant to several construction lien lawsuits begun in 1984 and 1985. These construction liens were incurred by the Farmwalds. On June 8, 1989, the premises were sold at a construction lien foreclosure sale for $13,500 to Rand Development. The redemption period from the construction lien foreclosure sale was four months.
On August 24, 1989, the premises were sold at a foreclosure sale by advertisement of the mortgage held by defendant. Defendant was the highest bidder, paying $52,286.59. The redemption period from the mortgage foreclosure sale was six months.
On October 6, 1989, two days before the expiration of the redemption period from the construction lien foreclosure sale, defendant redeemed the premises, paying $14,037.05. On December 5, 1989, defendant filed an affidavit of interest in real property indicating that redemption from the mortgage foreclosure sale would require payment of the bid price plus interest, as well as the amount paid to redeem the property from the construction lien foreclosure sale.
On February 23, 1990, a day before the expiration of the redemption period, plaintiff delivered to defendant two certified checks totaling $54,896.45. This amount represented the price bid by defendant at the foreclosure sale plus interest. Plaintiff maintained, and presently argues, that pursuant to MCL 600.3240; MSA 27A.3240, in order to redeem the property from the mortgage foreclosure sale, she is required to pay the sum bid at the foreclosure sale plus interest and any taxes and insurance premiums paid by the sale purchaser. Plaintiff argues that she is not obligated to pay the amount expended by defendant to redeem the premises from the construction lien foreclosure sale.
The trial court granted summary disposition in favor of defendant. Finding that MCL 600.3240; MSA 27A.3240 does not address whether the payment of prior existing liens merges into a mortgagee’s claim, the court applied the "underlying doctrine of redemption which has existed in the law for many centuries.” It concluded that the doctrine of redemption required payment by plaintiff. In the alternative, the court held that defendant was entitled to an equitable lien to recover the amount paid to preserve the property.
Although rejecting the argument that defendant is entitled to recover on the basis of redemption from a mortgage sale by advertisement, the Court of Appeals held that defendant was entitled to an equitable lien. By extinguishing the construction liens, defendant preserved plaintiff’s interest in the property and increased the value of the premises. Hence, the Court concluded that it would be inequitable not to require plaintiff to compensate defendant for the amount expended to redeem the property from the construction lien foreclosure sale. We granted leave to appeal.
II
We agree with the decision of the Court of Appeals that plaintiff has complied with the statutory requirements and therefore has properly redeemed the property from defendant’s foreclosure sale. Foreclosure sales by advertisement are defined and regulated by statute. Once the mortgagee elects to foreclose a mortgage by this method, the statute governs the prerequisites of the sale, notice of foreclosure and publication, mechanisms of the sale, and redemption. Upon a foreclosure sale, the mortgage debt is considered paid and the mortgage lien discharged. Wood v Button, 205 Mich 692, 701; 172 NW 422 (1919). If the mortgagee purchases the property at the sale, it stands in the position of an ordinary purchaser and obtains an ownership interest in the land, subject to the mortgagor’s opportunity of redemption. Doyle v Howard, 16 Mich 261, 265 (1867). In order to redeem the property from the mortgage foreclosure sale by advertisement under the plain meaning of MCL 600.3240; MSA 27A.3240, plaintiff must pay the bid price plus interest, and any amount for taxes and insurance that the purchaser has properly filed with the register of deeds.
Several early decisions of this Court strictly construed the redemption statute, precluding deviation from its terms despite equitable considerations. In Cameron v Adams, 31 Mich 426, 428 (1875), the Court declined to extend the redemption period despite the fact that defendant had paid part of the redemption amount and a serious illness had prevented him from conducting his personal business during the redemption period.
Where a valid legislative act has determined the conditions on which rights shall vest or be forfeited, and there has been no fraud in conducting the legal measures, no court can interpose conditions or qualifications in violation of the statute. . . . This principle has not been open to controversy, and is familiar and elementary.[ ]
This Court has also refused to allow the addition of attorney fees to the amount necessary to redeem from a foreclosure sale, although those attorney fees were paid pursuant to the mortgage agreement as part of the foreclosure sale bid.
As the law now stands it cannot be regarded as authorizing as a condition precedent to redemption any other exaction in the way of fees or compensation than such as the statute specifies, and stipulations in advance for gross allowances are not consistent with public policy. [Vosburgh v Lay, 45 Mich 455, 457; 8 NW 91 (1881).]
The mortgagee-purchaser at a foreclosure sale by advertisement in Walton v Hollywood, 47 Mich 385, 388; 11 NW 209 (1882), was not allowed to revive the mortgage lien on the property as secu rity for payment of sums expended by the mortgagee for taxes and insurance during the redemption period. Once the mortgagor paid the amount required by statute, redemption was considered accomplished despite these intervening payments by the foreclosure sale purchaser to preserve the property. The Court reasoned that after the sale, the rights of the parties are fixed by statute rather than controlled by the mortgage.
In Wood, supra at 703, the plaintiff was denied a lien in trust upon the land in the amount paid for taxes after the foreclosure sale by advertisement.
[T]he case presented is not one to be determined upon some notion of general equities. The parties have a right to stand upon the law. . . . The right to redeem from a foreclosure at law is a legal right, is created by statute, and can neither be enlarged nor abridged by courts. A redemption is complete when one having the right to redeem pays in proper time, to a proper person,—
"the sum which was bid . . . with interest . . . .”
Once redemption is completed pursuant to statute, "[t]he power of sale contained in the mortgage is exhausted, the mortgage debt is paid, the mortgage lien discharged, the sheriff’s deed canceled, and the mortgagee and the bidder at the sale have no further interest in the property.” Id.
Upon foreclosure by advertisement in the present case, the rights of the parties were controlled by statute. Before the redemption period expired, plaintiff tendered to defendant the amount required under MCL 600.3240; MSA 27A.3240 to redeem from a foreclosure sale by advertisement. The plaintiff therefore has legal title to the property free of defendant’s mortgage lien. We now turn to the issue whether an equitable lien may be imposed in favor of defendant so that defendant might recover the amount it paid to redeem the property from the construction lien foreclosure sale.
III
In the absence of a written contract, an equitable lien will be established only where, through the relations of the parties, there is a clear intent to use an identifiable piece of property as security for a debt. See Schrot v Garnett, 370 Mich 161; 121 NW2d 722 (1963). In Kelly v Kelly, 54 Mich 30; 19 NW 580 (1884), the son of a landowner sought to impose an equitable lien on his father’s property in the amount paid by the son to satisfy certain debts on the land. The Court dismissed the complaint, finding insufficient evidence to support the son’s assertion that he paid the creditors pursuant to an agreement with his father. In the absence of a written contract, "from the relations of the parties, equity will declare a lien out of considerations of right and justice, based upon those maxims which lie at the foundation of equity jurisprudence.” Id. at 47. The Court in Cheff v Haan, 269 Mich 593, 598; 257 NW 894 (1934), denied the plaintiff’s right to establish and foreclose an equitable lien on defendant’s property, holding:
Equity will create a lien only in those cases where the party entitled thereto has been prevented by fraud, accident or mistake from securing that to which he was equitably entitled.
Although several early decisions considered with equitable circumstances required a deviation from the literal requirements of the redemption statute, none is dispositive of the present case. In Grossman Bldg Co v Elliott, 382 Mich 596, 606; 171 NW2d 441 (1969), the Court refused to allow the plaintiff an extension to the three-month redemption period on the basis that no equitable considerations prevented the Court from literally following the plain intent and operation of the statute.
Absent some unusual circumstances or additional considerations not within the ambit of the statute, this Court must follow the clear and plain meaning of the statute.
We accept as a general rule that the right to redeem under present statutes is a legal right and can neither be enlarged nor abridged by the courts. [Id. at 603.]
Any deviation from the literal requirements of the statute "must be addressed to the conscience of the court.” Id.
In Wallace v McBride, 70 Mich 596; 38 NW 592 (1888), the holder of a second mortgage by fraud, Wallace, was required to assign the mortgage to the true mortgagee, Storrs. The Court also held that Wallace was entitled to establish a lien on the property in the amount paid to redeem the property from a prior mortgage. The Court reasoned that the money paid was for the benefit of Storrs. By redeeming the property from the foreclosure sale, Wallace saved the property for the use and benefit of Storrs, and "in equity it was the duty of Storrs to refund it to [Wallace].” Id. at 601. While the analysis in Wallace is persuasive, no statute controlled the circumstances in which a mortgagee was required to assign his interest because it was acquired fraudulently. In the present case, MCL 600.3240; MSA 27A.3240 specifies the requirements for redemption, leaving no room for equitable considerations absent fraud, accident, or mistake.
In GS Sanborn Co v Alston, 153 Mich 456; 116 NW 1099 (1908), the Court held that the purchasers at a tax sale were entitled to be reimbursed for taxes paid between the sale and the reconveyance to the owners. The owners knew the land was subject to taxation and ignored their duty to pay. The tax sale purchaser paid, the amount due for taxes in order to protect his title. Because of a "technical defect in the notice,” the owners were entitled to a reconveyance. The Court concluded that the owners "ought in justice and equity to be compelled to pay those taxes which the purchaser has been compelled to pay, or otherwise lose his title or lien.” Id. at 464. Alston, however, is distinguishable from the present case because it did not involve redemption from a foreclosure sale by advertisement and neither party satisfied the statutory requirements. The original owners did not satisfy the requirements for reconveyance from the tax sale, and the tax sale purchasers did not satisfy the statutory notice requirements. When confronted with equities conflicting with clear statutory language, the Alston Court stated, supra at 461: "Courts of equity, however, as well as law, must apply legislative enactments in accordance with the plain intent and language used by the legislature.” Where, as in the present case, a statute is applicable to the circumstances and dictates the requirements for relief by one party, equity will not interfere.
Finally, in the present case, defendant chose to foreclose by advertisement, which is strictly regulated by the statute. Had defendant chosen to proceed pursuant to a foreclosure suit in equity, it might have raised its equitable defenses. In Masella v Bisson, 359 Mich 512, 525; 102 NW2d 468 (1960), this Court acknowledged that one who seeks the statutory remedy in preference to resort to the equitable proceeding is bound to comply with the statute.
IV
In the present case, plaintiff and defendant were parties to a mortgage agreement that was extinguished by the foreclosure sale in August of 1989. At the time defendant redeemed from the construction lien foreclosure sale, there was no contract out of which an equitable lien could have been established. Defendant did not form an agreement with plaintiff regarding the effect of the redemption from the construction lien foreclosure sale on plaintiff’s right of redemption from defendant’s foreclosure sale. No fraud, accident, or mistake is alleged in this case. Had defendant redeemed from the construction lien foreclosure sale before foreclosing on the mortgage, it could have added to the mortgage debt the amount paid to redeem, thereby recovering that amount at the mortgage foreclosure sale. Even after the foreclosure by advertisement was begun, it could have been adjourned pursuant to MCL 600.3220; MSA 27A.3220, to allow the redemption period from the construction lien foreclosure sale to pass before conducting the mortgage foreclosure sale. Defendant could then have added to the mortgage debt and the mortgage foreclosure sale bid any amount it expended to redeem the property from the construction lien foreclosure sale.
Although a general notion of injustice might appear to support defendant’s assertion that plaintiff is receiving a windfall at defendant’s expense, under the strict requirements of the statute, plaintiffs are not required to reimburse defendants for that amount. The choice by defendant regarding the timing and manner of the foreclosure sale exposed it to the risk that plaintiff would redeem from the mortgage foreclosure sale without being held responsible for payment of the redemption expenses. Because there is no fraud, accident, or mistake, the clear language of MCL 600.3240; MSA 27A.3240 must control and defendants are entitled only to the mortgage foreclosure sale bid plus interest and any taxes and insurance properly paid during the redemption period.
The decision of the Court of Appeals is reversed.
Cavanagh, C.J., and Levin, Brickley, Boyle, Griffin, and Mallett, JJ., concurred with Riley, J.
Plaintiff acquired a fee interest in the property pursuant to a quit claim deed executed September 15, 1989. In consideration of $1 paid by plaintiff, plaintiff acquired a fee interest subject to the outstanding mortgage with the defendant.
This amount includes the bid price plus interest.
MCL 600.3240; MSA 27A.3240 provides in part:
(1) If the mortgagor . . . within the applicable time limit prescribed in this section, redeems the entire premises sold by paying to the purchaser . . . the sum which was bid for the entire premises sold, with interest from the time of the sale at the rate percent borne by the mortgage, . . . then the deed shall be void and of no effect. . . .
(2) If the purchaser, following the sale, pays any sum or sums as taxes assessed against the property or premiums upon any insurance policy covering any buildings located on the property which under the terms of the mortgage it would have been the duty of the mortgagor to have paid had the mortgage not been foreclosed, and which premiums are necessary to keep the policy in force until the expiration of the period of redemption, and the purchaser . . . makes an affidavit of the payment showing the amount and items paid, together with the receipt evidencing the payment of the taxes or insurance premiums . . . the register of deeds shall indorse on the documents filed the time they are received. . . . After a filing under this subsection, redemption shall only be made upon payment of the sum above specified plus the amount shown by the affidavits and receipts to have been so paid, with interest on that amount, from the date of the payment to the date of redemption, at the rate specified in the mortgage.
196 Mich App 168; 492 NW2d 466 (1992).
442 Mich 851 (1993).
MCL 600.3201; MSA 27A.3201.
See MCL 600.3201 et seq.; MSA 27A.3201 et seq.
Prior statutes required a redemptioner to pay the price bid at the foreclosure sale plus interest without providing for payment of intervening taxes or insurance premiums. See 1929 CL 14435; 1915 CL 14959; 1877 PA 129; 1871 CL 6922; 1863 PA 47.
See also Carlisle v Dunlap, 203 Mich 602, 606; 169 NW 936 (1918); Heimerdinger v Heimerdinger, 299 Mich 149; 299 NW 844 (1941).
The redemption statute did not provide for payment of intervening taxes and insurance. See n 8.
See also Mortgage & Contract Co v First Mortgage Bond Co, 256 Mich 451; 240 NW 39 (1932).
See also New York Life Ins Co v Erb, 276 Mich 610, 614; 268 NW 754 (1936), in which this Court held that equity will not revive the mortgage lien, nor "impress and enforce a lien” for taxes paid after the foreclosure sale by advertisement, where the statute did not provide for reimbursement for payment of intervening taxes. See n 8.
See also Drettman v Marchand, 337 Mich 1; 59 NW2d 56 (1953) (an equitable lien was established to enforce an agreement that the defendant fraudulently attempted to avoid).
The tax sale purchasers claimed the original owners showed such laches as to require equity to overcome strict statutory notice requirements.
Compare Hopkins v Sanders, 172 Mich 227; 137 NW 709 (1912), in which equitable circumstances were considered by the Court in establishing an equitable lien for taxes paid by the mortgagee that were due before the execution of the mortgage. The mortgagee brought foreclosure proceedings rather than foreclosing the mortgage by advertisement.
In 1 Cameron, Michigan Real Property Law: Principles and Commentary, § 18.80, p 648, the author cautions lenders to order a title report before a foreclosure sale by advertisement.
Priorities between mortgagees and construction lien claimants are ordinarily determined in judicial proceedings for the foreclosure of the lien or the mortgage. This is one important reason why a lender should have his title work upon the mortgaged premises brought up to date not only at the time of the notice of the foreclosure sale, but also just before the sale. If construction liens appear, the merits of proceeding with a foreclosure by advertisement are highly questionable because of the priorities problem.
Likewise, nonmortgagee purchasers at a foreclosure by advertisement should undertake a title search before purchasing at the sale in order to protect themselves from purchasing encumbered property and incurring preservation costs for which they might not be reimbursed. | [
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AFTER REMAND
Boyle, J.
The defendant has no standing to claim error on appeal in the impermissible use of silence when his position at trial was that he had not remained silent, but in fact had given a post-arrest, postcustody statement that the shooting was an accident.
Defense counsel waived any claim of such error. Not only did he fail to object to the prosecutor’s cross-examination of the defendant, counsel thereafter affirmatively sought to create the impression that the defendant’s trial testimony, that he had told the police that the shooting was an accident, was truthful. Therefore, impeachment with inconsistent conduct, the refusal to give a statement, was proper.
There is no conflict on this record between People v Bobo, 390 Mich 355; 212 NW2d 190 (1973), and federal decisions construing the Fifth and Fourteenth Amendments. Where a defendant claims that he gave an exculpatory statement to the police after arrest and warnings, neither Bobo nor any federal constitutional authority would preclude impeachment with prior inconsistent conduct, including silence. Harris v New York, 401 US 222; 91 S Ct 643; 28 L Ed 2d 1 (1971). The Court of Appeals thus erred in holding that Bobo required reversal. On this point it has never been questioned that Bobo is coextensive with federal law. People v Graham, 386 Mich 452; 192 NW2d 255 (1971). We would therefore reverse the decision of the Court of Appeals and reinstate the defendant’s conviction.
To the extent that the Court of Appeals relied on Bobo to conclude that the Fifth Amendment prevented impeachment with all reference to post-arrest silence, the court erred. As a matter of constitutional law, the federal and Michigan Constitutions do not preclude the use of a defendant’s prearrest or postarrest, pre-Miranda silence for purposes of impeachment at trial. People v Cetlinski, 435 Mich 742; 460 NW2d 534 (1990). Nor is there any constitutional barrier to the impeachment use of postwarning silence where the defendant claims at trial that he did not remain silent but made statements to the police consistent with his exculpatory testimony. The prosecution cannot use postwarning silence to impeach a defendant’s exculpatory trial testimony, but both Bobo and Doyle v Ohio, 426 US 610; 96 S Ct 2240; 49 L Ed 2d 91 (1976), recognize that silence is admissible to impeach a defendant’s claim that he did not remain silent. Bobo, supra, p 359.
To the extent the prosecutor’s initial question might have been aimed intentionally at the defendant’s postarrest, post -Miranda silence the question would have been objectionable under the rule of Doyle or Greer v Miller, 483 US 756; 107 S Ct 3102; 97 L Ed 2d 618 (1987). To the extent the prosecutor’s inquiry called for an irrelevant answer, it would have been objectionable under People v Collier, 426 Mich 23; 393 NW2d 346 (1986). However, these issues cannot be addressed on this record.
The defendant’s failure to object prevented development of a record that would allow us to decide whether the prosecutor’s question was (1) a legitimate inquiry testing the credibility of defen dant’s testimony on direct examination implying that he would have made an explanation consistent with his trial testimony but for the police conduct in "grabbing him,” or (2) an attempt to make less probable the inference that the defendant sought to establish, i.e., that his prearrest conduct indicated his innocence, by exploring the defendant’s statement on cross-examination that he had told Mr. Brandywine of the accident prior to going to the police and that he voluntarily went to the police. Thus, it is not possible to determine whether the inquiry was improper for constitutional or evidentiary reasons.
We would resolve this case on the basis that the defendant failed to object and thereafter claimed that he had made a post-Miranda statement to the police consistent with his trial testimony. It was the defendant’s position at trial that he did not remain silent. Moreover, the defendant affirmatively sought to establish that he did in fact make a pretrial statement and used that testimony to bolster his accident defense. Defendant thus converted a potentially objectionable situation into a claim of postarrest, postwarning conduct consistent with innocence. Evidence of Sutton’s post-arrest, postcustody behavior was permissibly used not to impeach defendant’s exculpatory story, but rather to directly contradict the claim that defendant had told his story after arrest. People v Bobo, supra; Doyle v Ohio, supra, pp 619-620, n 11. "The shield provided by Miranda cannot be perverted into a license to use perjury by way of a defense, free from the risk of confrontation with prior inconsistent utterances.” Harris, supra, p 226.
i
On February 14, 1982, the defendant, accompanied by the lawyer who ultimately became trial counsel, voluntarily came to the Taylor police station after learning that the police wanted to question him regarding the shooting death of Milton Taylor which took place the previous evening during a dance the defendant had attended with his brother. Upon arrival at the station, the police arrested the defendant and charged him with first-degree murder.
At the defendant’s trial, the prosecution presented proofs that prior to the shooting incident, which took place sometime after midnight, the defendant’s brother and the victim began to fight. As people tried to break up the fight, a shot was fired, hitting the victim. A witness testified that he saw the defendant pull out a gun and shoot the victim. The prosecutor also called Sergeant Thomas Bonner. He testified that, as part of the investigation, he had learned that the deceased uttered the words, "Sutton shot me, Thomas Sutton shot me.” The officer further testified that he learned that David Sutton, the defendant’s brother, had no brother named Thomas and that he and the defendant were the only Suttons. _
During cross-examination of Sergeant Bonner, defense counsel began to suggest defendant’s cooperation with the authorities by establishing that the defendant had initially voluntarily submitted himself to the police and was immediately charged with the crime, and further, that the defendant had voluntarily returned from Ohio following his flight from prosecution. No reference was made by the prosecution to any conduct of the defendant which might be construed as silence. The prosecution rested.
The defendant took the stand and on direct examination by his counsel said that his brother had given him the gun to hold during the dance, and that around 2:00 A.M., while he was helping collect money from people at the doorway, somebody said a fight had started. The defendant stated that he rushed over when he saw that it was his brother fighting and that he pulled out the gun, and said " 'Why don’t somebody stop the fight?’ ” At that point while he was trying to move closer to where his brother was fighting, the defendant stated that someone hit him and knocked the gun out of his hand. As he fell against one of the tables and tried to catch his balance he heard a weapon discharge. Defendant testified that he last saw the gun in the possession of a person named Hans-bury. He stated that he left the dance approximately one-half hour later, and that he never knew that anyone had been shot until the next day. The defendant testified that his only interest had been to protect his brother, and asserted that when he heard that someone had been shot he voluntarily went to the police department. He implied that he was prevented from relating his exculpatory version of the event when he added that he had no idea that he was going to be charged with murder and that Sergeant Bonner "just grabbed me” and said, " 'You are being charged with first-degree murder.’ ” During cross-examination the defendant said that he did hear the gun go off after he dropped it, and that he did not look for the gun after he regained his balance and was on his feet. After composing himself, he looked around and saw a Mr. Hansbury walking down a hallway holding the gun. The prosecutor then asked:
Q. You are telling me as soon as you got up from the table, Mr. Hansbury had the gun?
A. When I seen [sic] him, he had it.
Q. And what was Mr. Hansbury doing with the gun?
A. He was walking down the hallway with it.
Q. Did he give it to you?
A. No, sir.
Q. Did you ask him for it?
A. No, sir.
' Q. How many people at that point, Mr. Sutton, did you tell that [it] was an accident, [that] the gun was knocked from your hand?
A. I told Mr. Brandywine.™
The prosecutor also asked:
Q. How many times did you inquire when you composed yourself from hitting that table, how many times did you inquire if anyone got shot because the gun went off?_
A. I asked Mr. Brandywine.
The following colloquy then occurred:
Q. Now, when, Mr. Sutton, did you first learn that someone had been shot at the Fandango Hall?
A. The day after the cabaret.
Q. When did you tell the police it was an accident?
A. I can’t remember exactly when.
Q. You did tell the police?
A. Yes.
Q. Do you have any idea when you told the police?
A. No. I can’t remember.
Q. Do you have any idea what police you told?
A. Sergeant Bonner.
Q. Sergeant Bonner?
A. Yes.
Q. What year was that, sir?
A. ’82.
Q. ’82. Was that the same month of the shooting at the hall?
A. I think so, yes.
Q. Well, how did that occur? Did you call the police and tell them what happened?
A. I was in police custody.
At this point, although no objection was made, the prosecutor asked no more questions regarding this subject.
Thereafter the defendant rested. The prosecutor recalled Sergeant Bonner and asked one question, that is, "at any time in 1982, did this defendant, ever, Mr. Sutton, ever, tell you that the shooting at the Fandango Hall was an accident?” No objection was interposed, and Sergeant Bonner re sponded, "No he did not.” Defense counsel then cross-examined the witness and asked a series of questions suggesting that the defendant had told Sergeant Bonner the shooting was an accident when he was out of defense counsel’s presence and that the Sergeant was lying when he said otherwise. Defense counsel’s first question on recross was:
Q. [Mr. Henry]: Sergeant Bonner, first of all, when I brought Mr. Sutton out there to you, you took him off to mug him and do whatever else had to be done out of my presence?
A. Yes, sir.
Q. So then what—when he said he told you it was an accident and you said he didn’t tell you, then, it is you and him, he is lying. You can’t be lying?
A. I am not lying.
Q. I know that you are just like Caesar’s wife, honest and impeccable to the very last. You wouldn’t say anything wrong?
A. I am telling you the truth. I don’t know what you want.
Q. I know. I know.
Q. But you are [sure] of what he said? Did he ever tell you that he deliberately shot anybody?
A. No. He didn’t say that, either.
[Q.] Well, if you were so anxious to protect his rights, why couldn’t I have gone back with him while you were there fingerprinting him and going through these very items with him? What reasons do you have to keep me from going back with him?
Once again the prosecution recalled Sergeant Bonner for a single question. When asked if the defendant had made any statement, Bonner re sponded that after receiving warnings regarding his constitutional rights the defendant said he did not want to make any statements. No objection was made, and again defense counsel recross-examined Sergeant Bonner and pursued a line of questioning which implied that the defendant had told the detective of his claim of accident when he was separated from counsel at the police station for the purpose of fingerprinting, that Bonner was "running around trying to get people. ... to come in and testify against him,” and then concluded, "You are not supposed to make up a case.”
In his closing argument, the prosecutor without objection referred to the fact that the police officer indicated that the defendant had not made a statement to the police that the shooting was an accident. In closing, defense counsel stated,
He said that he told them it was an accident. To say that he didn’t make a formal statement when I am the one that said we don’t want any formal statements made, period, and that’s my judgment, not his.
But when they take him back to talk to him, to fingerprint him, what-not, he said that he told them it was an accident.
But who in the world—How do you think they are ever going to believe him. They still are charging him with first-degree murder. They have shown him nothing but this hard side of the mountain. That’s all they want to do.
Defendant Sutton was convicted by a jury of second-degree murder and possession of a firearm during the commission of a felony, and subsequently was sentenced to prison terms of eight to twenty years and two years. The Court of Appeals reversed the convictions and held that the Fifth Amendment precluded cross-examining the defendant regarding when he had told the police the shooting was an accident. Specifically noting Collier and citing Bobo, the panel observed that the Collier decision "does not cast doubt on this Court’s application of the Bobo rule” and found,
By asking defendant when he told the police that the shooting was an accident, the prosecutor infringed on defendant’s constitutional right to remain silent.
The panel concluded that the prosecutor’s argument deprived the defendant of a fair trial, citing People v Sain, 407 Mich 412; 285 NW2d 772 (1979).
ii
The sequence of events in the instant case is critical to our conclusion that error, if any, was waived. After direct examination of the defendant by defense counsel, the prosecutor directed cross examination to the defendant’s testimony on direct examination that the shooting was an accident. After the defendant testified that he told Mr. Brandywine the gun was accidentally knocked from his hand, the prosecutor asked Sutton .when he told the police the shooting was an accident. It was at this point that the defendant testified that he made a postarrest, postcustody statement to Sergeant Bonner consistent with the exculpatory story he was now giving at trial.
After the defense rested, the prosecutor recalled Sergeant Bonner and asked one carefully worded question—whether Sutton ever told Bonner that the shooting was an accident, and Sergeant Bonner replied that he had not. All this was done without objection by defense counsel.
At this point, defense counsel cross-examined Sergeant Bonner and asked a series of questions suggesting that Sutton had made such a statement out of his attorney’s presence and inferring that Sergeant Bonner was lying. Once again, on surrebuttal, the prosecution asked a single question— whether the defendant had made any statement to Sergeant Bonner. Sergeant Bonner responded that after giving Sutton Miranda warnings, Sutton said he wished to make no statement.
Presumably, both counsel were surprised by Sutton’s answer, since there is no record evidence that Sutton said anything to the police. When, contrary to what the lawyers presumably anticipated, Sutton claimed that he had made such a statement to the police, the prosecutor was faced with the following conundrum, i.e., how to counter that statement without making reference to the defendant’s exercise of his Fifth Amendment privilege against compelled self-incrimination. The prosecutor did that in the only way he could—by asking the officer one carefully worded question— whether the defendant had told the officer the shooting was an accident.
Defense counsel then had a tactical decision to make: (1) either to object to further questions and drop the subject or (2) to permit the questions to proceed and attempt to buttress his client’s testimony by suggesting through his own examination of the police officer that the statement was in fact made. Defense counsel chose the latter course by suggesting through his cross-examination of Bonner that Bonner was lying and then resting without recalling his client. The prosecutor’s single question of Sergeant Bonner on redirect examination was directly responsive to defense counsel’s tactical decision.
The same able and experienced retained counsel who represented defendant when he surrendered to the police and who advised defendant not to make a statement, did not object to the question regarding whether defendant had told the police as well as Mr. Brandywine his exculpatory version of the event. Nor did counsel object to seven subsequent questions regarding the same subject matter. Counsel thereafter strategically and affirmatively employed the defendant’s answer that he told the police, "when he was in custody,” that the shooting "was an accident” to buttress the accident defense. It is our conclusion that the defendant intentionally waived any plausible objection and thus invited impeachment with his inconsistent postarrest, postcustody behavior.
Defendant cannot assert that the Fifth or Fourteenth Amendment confers a right to create the impression, free from contradiction, that he cooperated with the police and made a statement after arrest. Bobo and Doyle both grant a defendant the right to bar impeachment of the defendant’s trial testimony where the government’s impeachment theory is that maintaining silence is inconsistent with innocence. But both cases also expressly recognize that the bar to impeachment by silence of exculpatory trial testimony does not extend to impeachment with a refusal to speak during interrogation which is inconsistent with defendant’s own statements at trial claiming that he made postarrest statements while in custody. As the court observed in an analogous situation in United States v Fairchild, 505 F2d 1378, 1383 (CA 5, 1975), on this record, there is no doubt that "the bar was lowered and [the defendant] discarded the shield which the law had created to protect him.”
The fact that a defendant’s silence might ini tially have been excluded for constitutional reasons does not grant a defendant immunity from impeachment with inconsistent conduct:
Constitutional rights, like others, may be waived; and a criminal defendant may, by his conduct, make otherwise constitutionally inadmissible evidence admissible for certain purposes. Harris v New York, 401 US 222; 91 S Ct 643; 28 L Ed 2d 1 (1971). Here the evidence of Fairchild’s Miranda silence was admissible for the purpose of rebutting the impression which he attempted to create: that he cooperated fully with the law enforcement authorities. Thus, it was not error for the trial court to admit Detective Hobbs’ testimony concerning Fairchild’s silence at the police station following his Miranda warnings. [Fairchild, supra, p 1383.]
United States Supreme Court cases decided subsequent to our holding in Bobo establish that when a defendant takes the stand and testifies the privilege against self-incrimination is waived and the defendant may be impeached with both prearrest silence and postarrest pre-Miranda silence without violating the Fifth Amendment. Jenkins v Anderson, 447 US 231; 100 S Ct 2124; 65 L Ed 2d 86 (1980); Fletcher v Weir, 455 US 603; 102 S Ct 1309; 71 L Ed 2d 490 (1982) (per curiam).
Where silence follows Miranda warnings, Fourteenth Amendment due process bars the use of such evidence to impeach a defendant’s exculpatory explanation at trial provided that the defendant does not claim "to have told the police the same version upon arrest.” Doyle v Ohio, supra, pp 619-620, n 11. Thus Doyle establishes that the discrepancy between a defendant’s exculpatory story at trial and his postarrest, postwarning silence is not available to the state to impeach the credibility of the defendant’s exculpatory testi mony. In this situation, silence has no probative value because "[s]ilence in the wake of these warnings may be nothing more than the arrestee’s exercise of these Miranda rights.” Doyle, p 617. Moreover, it is fundamentally unfair to use a defendant’s silence against him when he had been implicitly promised that if he remained silent he will not be penalized.
The Doyle Court, however, carefully distinguished the situation before it from a case in which a defendant claims to have told the police the same version upon arrest. Citing United States v Fairchild, supra, p 1383, the Supreme Court observed:
It goes almost without saying that the fact of post-arrest silence could be used by the prosecution to contradict a defendant who testifies to an exculpatory version of events and claims to have told the police the same version upon arrest. In that situation the fact of earlier silence would not be used to impeach the exculpatory story, but rather to challenge the defendant’s testimony as to his behavior following arrest. [Doyle, supra, p 619, n 11[ ]
The Supreme Court has consistently held, in the context of testimony substantively inadmissible because of a violation of the prophylactic rules implementing the Fourth Amendment, Walder v United States, 347 US 62; 74 S Ct 354; 98 L Ed 503 (1954), Fifth Amendment, Harris v New York, supra, and the Sixth Amendment, Michigan v Harvey, 494 US —; 110 S Ct 1176; 108 L Ed 2d 293 (1990), that the defendant may not turn the illegality "to his own advantage, and provide himself with a shield against contradiction of his untruths,” Walder, supra, p 65. Most recently the Supreme Court has held that a statement inadmissible in the prosecution’s case in chief because it was obtained in violation of the rule protecting defendant’s Sixth Amendment right to counsel, Michigan v Jackson, 475 US 625; 106 S Ct 1404; 89 L Ed 2d 631 (1986), may be used to impeach a defendant’s false or inconsistent testimony, Michigan v Harvey, supra, 108 L Ed 2d 303, observing, "[w]e have never prevented use by the prosecution of relevant voluntary statements . . . .”
To the extent that the Court of Appeals may have concluded that Bobo precluded impeachment with silence inconsistent with a defendant’s trial testimony that he had made a statement while in custody, the decision was inconsistent with Doyle, Graham, and Bobo itself.
hi
Had an objection been interposed, the burden would have been on the prosecutor to establish that there was a permissible line of relevant inquiry either for use during cross-examination or as a foundation for proper impeachment. Thus, had objection been made, the prosecutor might have failed to establish that the question was permissible cross-examination or have succeeded in establishing that the question was directed to permissible impeachment. However, no objection was interposed following the prosecutor’s initial question, and the defendant responded that he had told police that the shooting was an accident. Nor was any objection made to seven subsequent questions regarding the same subject. Had defendant objected and the objection been overruled, our task would have been to decide whether there was a permissible basis for cross-examination or a lawful basis for impeachment. If there was neither, we would have had to decide whether the error was of an evidentiary or a constitutional nature and, if constitutional, whether the trial was so tainted that reversal was required. People v Manning, 434 Mich 1; 450 NW2d 534 (1990)._
However, defendant not only failed to object, but made affirmative use of his testimony that he had not remained silent, thus waiving any error. To directly contradict Mr. Sutton’s testimony that he told Sgt. Bonner it "was an accident” "when I was in custody,” Sergeant Bonner was recalled in rebuttal and asked one question, "At any time in 1982, did this defendant, ever, Mr. Sutton, ever, tell you that the shooting . . . was an accident?” Defense counsel again did not object. On cross-examination, defense counsel thereafter suggested that the defendant had made consistent exculpatory statements when Bonner separated defendant from counsel to fingerprint him, asking Bonner:
Well, if you were so anxious to protect his rights, why couldn’t I [defense counsel] have gone back with him while you were there fingerprinting him . . . ? What reasons do you have to keep me from going back with him?
The first mention of "silence” was offered to directly contradict this examination. Defendant’s position at trial, pursued throughout testimony and in closing argument, was that he had not been silent, but had maintained his theory of innocence, even to the police and even while in police custody. This testimony, if believed by the factfinder, would surely be seen as significantly enhancing the truthfulness of the defendant’s accident defense and of the defense sub theme that the police had "pinned” the crime on an innocent man. For precisely this reason, we can find no fundamental unfairness in admitting evidence of the defendant’s inconsistent conduct in declining to make a statement.
Inquiry regarding postarrest post-Miranda silence is not error where the prosecutor is seeking not to impeach the defendant’s exculpatory story with silence, but rather to challenge the defendant’s trial testimony regarding his postarrest behavior. Indeed, Doyle itself recognizes that impeachment with postarrest post-Miranda silence is permissible to contradict a defendant’s trial testimony of an exculpatory version of events and claim that the same story had been told on arrest, an exception recognized by this Court in People v Graham, supra, whose continued vitality was approved in Bobo itself, p 359. We reiterate the Court’s observation in Doyle:
It goes almost without saying that the fact of post-arrest silence could be used by the prosecution to contradict a defendant who testifies to an exculpatory version of events and claims to have told the police the same version upon arrest. In that situation the fact of earlier silence would not be used to impeach the exculpatory story, but rather to challenge the defendant’s testimony as to his behavior following arrest. Cf. United States v Fairchild, 505 F2d 1378, 1383 (CA 5, 1975). [Doyle v Ohio, supra, p 619, n 11.]
The constitution protects the rights of all. It does not license a defendant to present testimony directly contradictory of other proven facts to the factfinder, free from the risk that he will not be impeached. "It goes almost without saying” that at the bottom of this is the claim of a constitutional right to immunity from contradiction, a claim that has not been endorsed by this Court or any other.
CONCLUSION
Construing People v Bobo as coextensive with federal precedent, we hold that impeachment of exculpatory testimony with pre- or postarrest, preMiranda silence is permissible under the Michigan Constitution. Likewise, a defendant’s right to remain silent is protected by the Fourteenth Amendment which precludes the use of a defendant’s silence following Miranda warnings to impeach an exculpatory story.
However, defendant Sutton did not offer only an exculpatory story, but affirmatively stated and pursued the theory that he had made a postarrest, post-Miranda warning statement to the police consistent with his trial testimony. Nothing in the Fifth Amendment or Bobo itself allows a defendant to so testify free from contradiction.
In these circumstances, the prosecution was not precluded from rebutting defendant’s claims of postcustody statements consistent with his accident defense with evidence of the defendant’s post-warning silence. Defendant chose to make affirma tive use of his purported cooperation with the police and thus waived the protection the constitution would otherwise have afforded.
Accordingly, we reinstate the defendant’s conviction.
Riley, C.J., and Griffin, J., concurred with Boyle, J.
Miranda v Arizona, 384 US 436; 86 S Ct 1602; 16 L Ed 2d 694 (1966).
However, had the prosecution intended to pursue an impermissible line of inquiry, no actual Doyle violation occurred in this case. The prosecutor’s question produced the answer that the defendant had told the police it was an accident. Thus, there was not a use of the defendant’s silence after invoking his Miranda rights, violative of the defendant’s Fourteenth Amendment rights. Had the defendant objected, the question would be analyzed as an attempt to violate Doyle evaluated under the fair trial standards of Greer, supra, and People v Sain, 407 Mich 412; 285 NW2d 772 (1979).
The dissent observes there are only three possible responses by Sutton to the prosecutor’s question when he told the police the shooting was an accident. (Post, pp 602-603.) There is, however, a fourth possibility: defendant could have responded that he did inform the police and this statement was made prearrest and pre-Miranda. This logical fallacy of the dissent is the assumption that the question called for a response directed at post-Miranda silence. Rather, the question was directed at conduct inconsistent with trial testimony which could have occurred prior to or subsequent to arrest.
The defendant’s trial took place in February of 1984. The defendant failed to appear for his originally scheduled trial on June 16, 1982.
The shot had been fired from a gun the defendant’s brother had brought with him to the dance. The defendant testified that during the evening his brother asked him to hold the gun he had brought to use as protection while collecting and transporting the proceeds of the dance.
Another witness testified that she had tried to help the victim after he was shot. She also stated that when she asked the victim who had shot him he said "Sutton,” and that when she asked again he said “Thomas Sutton.”
Sutton had failed to appear on the original trial date and was subsequently arrested in Ohio in August of 1983 and returned for trial.
The defendant also stated that he did not fight extradition and that he came back from Ohio voluntarily.
Mr. Brandywine did not indicate that the defendant spoke with him at all after the shooting.
In his closing argument, the prosecutor stated:
He also told us back in 1982, when the defendant was originally arrested, that the defendant never indicated to him that the shooting was an accident, but, in fact, indicated to him that he had nothing to say, no statement.
MCL 750.317; MSA 28.549.
MCL 750.227b; MSA 28.424(2).
People v Sutton (On Remand), unpublished opinion per curiam of the Court of Appeals, decided April 28,1987 (Docket No. 98295).
On initial appeal, the Court of Appeals reversed the defendant’s convictions, finding an error under People v Ora Jones, 395 Mich 379; 236 NW2d 461 (1975), on the basis of the trial court’s failure to instruct, sua sponte, regarding the defendant’s accidental shooting theory. People v Sutton, unpublished opinion per curiam of the Court of Appeals, decided April 24,- 1986 (Docket No. 81069). This Court reversed the Court of Appeals judgment, reinstated the defendant’s convictions, and remanded the case to the Court of Appeals for consideration of the remaining issues. 428 Mich 858 (1987).
This Court granted leave to address the issue whether the cross-examination violated the defendant’s rights under the federal or Michigan Constitutions. People v Sutton, 429 Mich 858 (1987).
Contrary to the conclusion that impeachment with prior inconsistent conduct was not the prosecutor’s goal because he failed to inquire further about Sutton’s alleged statement, post, p 604, n 11, the prosecutor did ask when Sutton told the police about his story, who he told, what year and month he made the statement, and how it came about that he made such a statement. It was only after these additional questions were asked that the prosecutor ended his inquiry. Moreover, all these questions were asked and answered without objection from defendant.
The fact that the prosecutor did not go further is perhaps explained by the fact that he knew Sutton had not made a statement. Thus, rather than bring out what Sutton had purportedly said through Sutton’s own words on cross-examination, he wisely left to defense counsel the choice whether to drop the subject or to pursue an inquiry regarding what Sutton actually said. Defense counsel chose to pursue the content of the purported statement through suggestive questioning of Bonner. It is not who was questioned, but the fact that the theory was pursued that evidences the tactical decision of defense counsel. (Post, pp 606-607.)
It is arguable that defendant had already opened the door to a full, and not merely selective, development of the subject of cooperation which he himself broached during his direct testimony. Assuming, however, that defendant had not yet opened the door, a timely objection to the prosecutor’s question on cross-examination would have at a minimum forced the prosecutor to clarify the theory on which he based the impeachment. An objection might have resulted in a direction from the trial court that the prosecutor’s question was to be limited to the prearrest pre-Miranda warning period.
In Anderson, Warden v Charles, 447 US 404; 100 S Ct 2180; 65 L Ed 2d 222 (1980) (per curiam), the Court held it was not a violation of due process for the state to admit evidence of the defendant’s post-arrest post-Miranda statement if there is a factual inconsistency between the defendant’s postarrest statement and his trial assertions. Id., p 409. Further, in 1982, the Court decided in Fletcher v Weir, supra, p 607, that postarrest silence could be used for impeachment purposes when it did not appear from the record that Miranda warnings had been given.
The dissent asserts at post, p 616 that this exception in Doyle is not applicable here because it was on cross-examination and not direct examination that Sutton testified that he had informed the police that the shooting was an accident. The Doyle Court, however, made no such distinction.
Some courts hold that where postarrest post -Miranda silence is arguably in question, the burden is on the prosecutor to establish that there is a permissible line of inquiry. In State v Lofquest, 227 Neb 567; 418 NW2d 595 (1988), the prosecutor’s questions and statements were directed specifically to the postarrest time period. Over defense counsel’s objection, the prosecutor continued with a line of questioning and remarks as to what police might have done had the defendant told his story as he should have, and the court found Doyle error on the basis that it was impossible to discern for purposes of a Doyle inquiry, what period of silence the prosecutor was referring to, preMiranda or post-Miranda. Id., p 570. See also United States ex rel Allen v Franzen, 659 F2d 745 (CA 7, 1981), cert den 456 US 928 (1982). Further, in both Lofquest and Franzen credibility was closely contested, and the prosecutorial comments and questions, directed to the postarrest time periods, made it impossible to determine whether the references were to silences occurring during the pre- or post-Miranda time periods and constituted violations of the defendants’ rights to due process.
No "use” was made of defendant’s silence because defendant claimed he had not remained silent. In constitutional terms, the prosecutor’s inquiry might only have been a Greer error, i.e., an intentional attempt to use the defendant’s silence, requiring reversal where it has so infected the process as to deprive defendant of a fair trial. It might also have been a permissible reference to prearrest silence.
It could fairly be said that both the defense and prosecuting attorneys engaged in sharp practice. Had the prosecutor made affirmative use of the defendant’s silence in his closing argument, and the defendant had objected, People v Sain, supra, might require reversal. The record, however, does not reveal "that the prosecutor seized upon the response of the police officer and used it to maximum advantage.” Here, unlike in Sain, the prosecutor did not "clearly and repeatedly ask[ ] the jury to consider, as a factor in favor of a finding of guilt, that the defendant, when confronted by the police at the time of his arrest, remained silent.” Id., pp 415-416.
Thus, Lofquest and Franzen are distinguishable from the facts and issues presented in Sutton. Unlike the instant case, in Lofquest and Franzen the defendant did not testify at trial that he gave a statement to the police that was consistent with his exculpatory story given at trial. As noted in Doyle, supra, pp 619-620, n 11, in Sutton the defendant’s silence was not used to impeach his exculpatory story given at trial. Rather, it was used to impeach the defendant’s trial testimony that he gave that exculpatory story "while in custody” with his inconsistent behavior following his arrest. Thus, there could be no Doyle error.
In United States v Havens, 446 US 620; 100 S Ct 1912; 64 L Ed 2d 559 (1980), the Supreme Court rejected the claim that rebuttal evidence was limited to contradiction of a particular statement made by a defendant during his direct examination. The court held that "a defendant’s statements made in response to proper cross-examination reasonably suggested by the defendant’s direct examination are subject to otherwise proper impeachment by the government, albeit by evidence that has been illegally obtained and that is inadmissible on the government’s direct case, or otherwise, as substantive evidence of guilt.” Id., pp 627-628.
We agree with Chief Justice Riley’s position in People v Dyson, 106 Mich App 90; 307 NW2d 739 (1981). The facts in Dyson are similar to those in Sutton. In Dyson, the defendant took the stand and presented an alibi defense. He was then asked on cross-examination whether he told his alibi to the complainant when she identified him, and he responded that he had. Moreover, he testified that he also told the police when they first stopped him. On redirect examination, the defendant maintained that he attempted to tell the officers but they told him to "shut-up.” On recross-examination, the defendant testified that he offered his story to the police but they were not interested in hearing it.
In rebuttal to the defendant’s testimony, the prosecution recalled the two arresting officers. In response to narrow specific questions, both testified contrary to the defendant’s testimony that he had not told them at the time of arrest of his alibi. The Dyson Court concluded, "[o]n these facts, we find that the officers’ testimony was proper rebuttal testimony. . . . Having concluded that the testimony of the police officers was admissible to impeach defendant’s own inconsistent statements at trial, we also conclude that it was properly brought in as rebuttal testimony.” Id., pp 95-96.
Like the defendant in Dyson, Sutton attempted to bolster his accident defense by testifying that he previously told his exculpatory story to the police officers "while in custody.” Thus, the Dyson Court’s conclusion applies here as well. "The rebuttal testimony of the officers was that he had not told them. It was a simple contradiction of defendant’s testimony that directly tended to disprove the exact testimony given by the witness. As so limited, it was proper rebuttal testimony, serving to impeach defendant on a material and relevant matter.” Id., p 97. But see contra People v Pelkey, 129 Mich App 325; 342 NW2d 312 (1983).
See, e.g., United States v Conlin, 551 F2d 534 (CA 2, 1977), cert den 434 US 831 (1977); Summit v Blackburn, 795 F2d 1237 (CA 5, 1986); United States v Dixon, 593 F2d 626, 629 (CA 5, 1979), cert den 444 US 861 (1979).
In United States v Fairchild, supra, p 1383, the court concluded that defense counsel’s elicitation from a police agent during cross-examination that his client had no criminal record and had voluntarily provided handwriting samples, followed by the question, " 'During the period of time that this investigation has been going on, to your knowledge has Mr. Fairchild cooperated fully with the fbi and U.S. Attorney’s office in responding with anything that you all wanted?’ ” permitted impeachment with postarrest silence.
See also United States v Mavrick, 601 F2d 921, 932 (CA 7, 1979), in which the defense counsel elicited the following testimony from the defendant in his direct examination:
"Q. Did you attempt at the time of your arrest to explain your conduct to those officers who were taking you into custody?
"A. Yes, we did.
"Q. Did they give you an opportunity at that time to speak?
"A. No, they told us to shut up, and they don’t want to hear it.” | [
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ON REHEARING
Riley, C.J.
We granted rehearing after our decision in Frankenmuth Mutual Ins Co v Keeley, 433 Mich 525, 528; 447 NW2d 691 (1989), in which we reversed the decision of the Court of Appeals and held "that when an insurer has exhibited bad faith in failing to settle a claim on behalf of its insured, and a judgment in excess of the policy limits results, the insurer is liable for the excess without regard to whether the insured has the capacity to pay.” After hearing oral arguments on rehearing, this Court remanded the instant case to the trial court to determine whether Frankenmuth’s acts of bad faith caused the excess judgment. On April 17, 1990, the trial court reaffirmed its conclusion that Frankenmuth acted in bad faith when it failed to discharge its attorney for representing the adverse interests of Frankenmuth and its insured, Mrs. Keeley, at the same time. On May 23, 1990, the trial judge filed written supplemental findings and affirmed its decision of April 17, 1990. The court concluded that Frankenmuth’s acts of bad faith with regard to Mrs. Keeley did not import a finding of bad faith with regard to Frankenmuth’s representation of Charles Keeley. Moreover, the court reaffirmed its conclusion that any acts of bad faith did not cause the excess judgment against Charles Keeley. We agree and so hold.
More importantly, this Court’s decision on the causal relationship between any bad faith and the excess judgment against Charles Keeley does not address the issue which this Court originally decided and granted rehearing to consider, namely, whether this Court should reconsider the version of the excess-judgment rule adopted in our original opinion, and adopt the rule set forth in Justice Levin’s dissenting opinion. While this Court could simply vacate its original opinion upon the basis of bad faith and its causal relationship to the excess-judgment issues, we prefer to resolve the excess-judgment issue at this time.
However, unlike Justice Archer, we are now convinced that the rule articulated in Justice Levin’s dissent represents the better measure of an insurer’s liability when the insurer exhibits bad faith that causes a judgment against its insured in the underlying tort suit which exceeds the policy limits. Therefore, we adopt Justice Levin’s dissent in the instant case. Id. at 546.
Accordingly, we affirm the result of the Court of Appeals.
Levin, Brickley, and Griffin, JJ., concurred with Riley, C.J.
433 Mich 1226 (1989).
As a result, the trial court awarded $4,152 plus interest to Mrs. Keeley because she had to secure another attorney to represent her. | [
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McDonald, C. J.
This is a suit at law after rescission to recover money paid on a land contract.
On May 27, 1924, the defendant sold certain real estate on two land contracts to Nathan P. Levin, who subsequently assigned his vendee’s interest to the plaintiff, Rosenthal. The assignments were consented to by the vendor. Rosenthal made payments for a time, then defaulted. The defendant vendor served notice of intention to forfeit the contracts and later a declaration of forfeiture. Thereafter, summary proceedings for possession were begun and judgment for restitution was entered. After writs of restitution were issued, Rosenthal declared a rescission of the contracts for failure to install improvements in accordance with the provisions thereof and instituted the present suit. The defendant appeared, and, under Court Rule No. 18 (1931) filed a motion to dismiss supported by affidavit. The motion was granted, and the plaintiff has appealed.
The question raised by the motion to dismiss was whether the plaintiff could rescind for breach of provisions in the contracts and maintain a suit for damages after valid forfeiture and judgment in summary proceedings in which proceedings no defense of breach is made.
The plaintiff rescinded on the ground that defendant had breached the contract relative to instalment of certain improvements. If the defendant had breached the contracts he could not have maintained summary proceedings, for if there was a breach there was no cause for forfeiture and no right to possession. The breach was a proper defense in the action before the commissioner for possession. The plaintiff could not withhold that defense and subsequently use it as a ground for. rescission. The validity of the forfeiture was established by the judgment in the summary proceedings. Thereafter, when he attempted to rescind, his interest in the contracts had been terminated. He had nothing to rescind. Blazewicz v. Weberski, 234 Mich. 431; Augustyn v. Zawacki, 250 Mich. 218; Security Investment Co. v. Meister, 214 Mich. 337.
The declaration contains a special count and the common counts in assumpsit. The plaintiff contends that on motion to dismiss it cannot be held that the common counts do not state a cause of action. There is no doubt as to that rule, but where the common counts rest upon the facts averred in the special count the rule does not apply. Lightstone v. Fixel, 227 Mich. 360.
In the instant case, the special count sets up the facts constituting the entire cause of action. The common counts rest on the same facts, which do not state a cause of action. The common counts were not required. The plaintiff does not claim anything beyond what appears in the special count. In these circumstances, the rule that on motion to dismiss it cannot be held that the common counts do not state a cause of action does not apply.
The trial court was right in granting the motion to dismiss. The judgment is affirmed, with costs to' defendant.
Fead and Wiest, JJ., concurred with McDonald, C. J. | [
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] |
Clark, J.
Plaintiffs brought ejectment to determine title to a narrow strip of land and to settle boundary, and had verdict and judgment, from which defendants have appealed.
Plaintiffs own lot 7, block 2, J. C. Wood’s Addition to Jackson. Defendants own part of lot 6, adjoining on the north. The disputed strip lies between the two parcels and averages about one foot in width. The dispute was produced by survey of a lot south of plaintiffs’ lot, by reason of which plaintiffs were asked to concede a different lot line on the south, which they did, and they in turn asked defendants to make like concession to them, which was refused. The jury found the surveyed line, according to a' correct and original survey, to be as claimed by plaintiffs. The finding could not well have been otherwise. The resurvey involved an original monument, and its correctness is sustained by at least the great weight of the evidence.
Adverse possession-was also submitted as an issue of fact. We think on this issue defendants were entitled to a directed verdict, as requested. Defendants had possession of the disputed strip for more than the statutory period before suit. The line was marked by stakes, a post, and by trees. Defendants ’ lot, including the strip, in early years was maintained at a different grade from that of the lot now owned by plaintiffs. It was occupied by defendants by way of care usual to owners of lots. Later, and after tbe grade of the lot now owned by plaintiffs was raised, defendants planted a hedge along the line which was on the line of the disputed strip. Defendants cared for and maintained the hedge and cut grass. Defendants at all times here in question have used and occupied the strip as their own and under claim of right. Plaintiffs had a driveway south of the hedge. That someone occasionally ran over the hedge or turned too short at the street line is not sufficient to raise an issue of adverse possession.
In Whitaker v. Shooting Club, 102 Mich. 454, 459, the established rule of this court respecting adverse possession is stated :
“ 'It is sufficient if the acts of owner ship are of such a character as to openly and publicly indicate an assumed control or use such as is consistent with the character of the premises in question.’ Murray v. Hudson, 65 Mich. 670, 673.”
The syllabus of Foster v. Wagenaar, 251 Mich. 370:
“Title by adverse possession was acquired where possession and occupation of city lot continued for more than statutory period, although boundary thus established is not true line according to plat.”
Plaintiffs’ contention that there could not be adverse possession because they did not have actual knowledge that the holding was adverse is answered by Bird v. Stark, 66 Mich. 654, quoting syllabus:
“Adverse possession for 15 years is a statutory bar, and needs no agreement; and actual knowledge of such adverse holding is not required when the circumstances are such that the contiguous holder ought to have such knowledge. ’ ’
Although defendants may have been mistaken as to the true line, they took the disputed strip, believing it to be their own, and they have claimed and held it adversely for moré than the statutory period, and hence have title to it by adverse possession. 2 C. J. p. 141; Call v. O’Harrow, 51 Mich. 98; Vandenberg v. DeVries, 220 Mich. 484; Pugh v. Schindler, 127 Mich. 191.
Reversed, with costs, and remanded for judgment for defendants.
McDonald, C. J., and Potter, Sharpe, North, Dead, Wiest, and Butzel, JJ., concurred. | [
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] |
Sharpe, J.
This case was tried by the court without a jury. Findings of fact were filed, from which it was concluded that plaintiff could not recover, and a judgment was entered for the defendants, from which the plaintiff has taken this appeal.
In 1926 the plaintiff was engaged in business in Detroit as a general contractor. ITe specialized in the erection of residences costing $50,000 and upwards. Learning that the plaintiff was intending to bid on the erection of a home for Andrew Wineman, the defendants, on October 23, 1926, wrote plaintiff a letter stating that they had “figures for some of the other general contractors ’ ’ on the cost of lathing and plastering this residence, and offered to do the same for the sum of $5,265.
On December 3, 1926, the plaintiff wrote defendants :
“Re Andrew Wineman residence. Gentlemen: This is to confirm our telephone conversation of December 2,1926, and is your authority to proceed with any preliminary work that may be necessary pending' signing of contract, which will be for the sum of $5,265.”
There is some dispute about the conversation over the telephone referred to in this letter. The defendants claim that they at all times insisted that a contract must be executed before they would begin work. Frank H. Zimmerman, one of the defendants, testified :
“I called Mr. Clore on the telephone I believe the following day after I received this letter and I told him I had received this letter in accordance with our conversation of the day before, but that the fact that he has requested me to proceed with preliminary work was of no interest to me unless I had the assurance in a form of a contract of doing the entire job; we were not interested in putting hangers in maybe only to find out at a later date that the profitable end of the job, the lathing and plastering was awarded to one of our competitors; and unless he could favor us with formal contracts, the terms of which were subject to our mutual agreement, that I would not •proceed with any preliminary work, which I did not.”
Plaintiff denies that this conversation was had. The written contract was not sent to defendants until February 5, 1927. On being asked the cause of this delay, plaintiff testified:
“Well, due to the fact, due to the fact that I had not the written contract ready to proceed with the job, I understood, as far as the contract was concerned, he understood the job was his and he was going ahead as soon as I got to it and any time between, then and the time he would actually start work on the job would be ample time for the confirmation of the contract, or the execution of the contract. ’ ’
This contract covers five pages of the printed record and contains provisions which the defendants might well have insisted should be agreed upon before the work was begun. On February 5, 1927, the defendants wrote plaintiff, declining to enter into the contract for the reason, among others, that the cost was figured in October' — •
“And in view of the fact that we had not received a contract on same it was impossible for us to protect ourselves on material as- well as other portions of the work which we let out. We also understand that this operation will not be ready for a couple of months and in checking over our figures as of today we find it will be impossible for us to accept your contract for $5,265.”
They further stated that their estimate of cost as of that day was in excess of the offer made by $1,000, and that they would enter into the contract “if signed within the next 10 days” for the price of $6,265.
Plaintiff thereafter let the contract to another party for the sum of $900 in excess of defendants’, first offer, and this action is brought to recover that amount.
The trial court found that no binding contract existed. This finding was based on the telephone conversation had and the delay in tendering the contract for execution. The defendants expected to sublet parts of the work, and the contention that the cost would vary as time elapsed, and that they could not safely do so until a written contract was entered into, seems established.
In our opinion, he reached the right conclusion. The judgment is affirmed.
McDonald, C. J., and Clark, Potter, North, Pead, Wiest, and Butzel, JJ., concurred. | [
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] |
Clark, J.
Plaintiff, a boy eight years and four months old, possessed of all his faculties, bright and intelligent, familiar with the place and knowing the danger, attempted to cross the railroad tracks of defendant, and was struck and injured by a train.
The railroad tracks are on the line between the cities of Detroit and Hamtramck, and run north and south. Woodland street of Detroit ends at the right-of-way, and nearly opposite, and on the east side of the right-of-way, Woodland street of Hamtramck begins. The right-of-way occupied by several tracks between the two ends of the streets is right-of-way, not street. However, in this thickly populated district, pedestrians, for a long time, and in very considerable numbers, have crossed the tracks almost as though the streets were continuous. The record is that defendant has passively suffered the practice, perhaps being powerless to prevent it.
In plaintiff’s behalf there was some testimony that he and his younger sister were on their way to school at noon; that, leaving his sister on the west side of the right-of-way, he crossed to the east side to see if it was safe to cross; that a train passed; that, when about to return, he saw some cars to the south, did not notice that they were moving; that he started back, and when he reached the second or third tracks he saw the cars almost upon him; that he attempted to escape, fell, and the cars cut off a leg. There is some further testimony that the cars were being pushed ahead of the locomotive, 33 to 35 cars in the train with the locomotive near the middle of it, and that there was no lookout at the head of the train. There is a bit of testimony that the whistle was not sounded, and some purely negative testimony that the bell was not ringing. On the other hand, defendant had testimony of employees and convincing testimony from disinterested witnesses to the effect that the locomotive was at. the head of the train -and that the boy was beside the moving train attempting to hook cars, and that he thus fell and was injured. There was further testimony that the boy was injured by a certain car wheel well back in the train; that the bell was ringing and that proper lookout was kept. The declaration counts upon so-called ordinary negligence as distinguished from last clear chance. Plaintiff had verdict, and, upon decision of a reserved motion to direct, defendant had judgment. Plaintiff has appealed. Defendant has also assigned errors for consideration in case the order of the trial court of judgment notwithstanding the verdict be not sustained.
Although the motion is for judgment notwithstanding the verdict, not for new trial, one of the grounds is that the verdict is against the great weight of the evidence. Conceding that it should be so held, the matter cannot be here decisive. The weight of authority no doubt is that there is no object in permitting a jury to find a verdict which the court would set aside as soon as found. 38 Cyc. p. 1572. But this court, in common with courts of some other jurisdictions, adheres to the rule that a verdict cannot be directed properly where the evidence presents an issue-of fact. Charon v. George W. Roby Lumber Co., 66 Mich. 68; Weyburn v. Kipp’s Estate, 63 Mich. 79, are but two of the- many cases which might be cited. And the decision of the reserved motion to direct is but a decision as upon motion to direct. Yacobian v. Vartanian, 221 Mich. 25.
As the path across the tracks was not a public crossing, the statute (2 Comp. Laws 1929, § 11181), requiring signals for public crossings, is not applicable. Lepard v. Railroad Co., 166 Mich. 373 (40 L. R. A. [N. S.] 1105); note: 66 A. L. R. 819.
The purely negative testimony of not hearing the bell ringing as against positive testimony that it was ringing raised no issue of fact. Hinderer v. Railroad Co., 237 Mich. 232 (26 N. C. C. A. 871). But defendant was bound to anticipate that persons might be on the tracks at the place in question and that the train could not be operated upon the presumption that the tracks were clear. Hoover v. Railway Co., 188 Mich. 313. It was its duty to operate its trains with reasonable care to avoid injury to such licensees. Risbridger v. Railroad Co., 188 Mich. 672; Huggett v. Erb, 182 Mich. 524 (Ann. Cas. 1916 B, 352); Doyle v. Portland R. L. & P. Co., 71 Ore. 576 (143 Pac. 623, 8 N. C. C. A. 146); St. Louis & S. F. B. Co. v. Jones, 78 Okla. 204 (190 Pac. 385, 16 A. L. R. 1048); 52 C. J. p. 554.
Testimony in behalf of plaintiff that cars, perhaps 16 or more, without lookout, were pushed by the locomotive across the path where very many persons were accustomed to cross, as against evidence for defendant, made an issue of fact of defendant’s negligence in that regard. Smith v. Railroad Co., 136 Mich. 224; Green v. Railway Co., 110 Mich. 648 (12 Am. Neg. Cas. 128).
It follows that judgment notwithstanding the verdict ought not to have been ordered.
Turning to defendant’s assignments, we find reversible error in submitting to the jury a theory of recovery upon doctrine of last clear chance which was without both pleading and proof, as the trial judge states in an opinion filed.
It was also reversible error to instruct that plaintiff on his contention of facts was not guilty of contributory negligence, as that question, under plaintiff’s own somewhat contradictory testimony as to looking and being watchful, was for the jury.
Other questions are not likely to arise again. Reversed, without costs. New trial granted.
McDonald, C. J., and Potter, Sharpe, North, Fead, Wiest, and Btjtzel, JJ., concurred. | [
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] |
Sharpe, J.
William A. Schlientz, Jr., engaged in business as a common carrier at Grand Rapids, under the name of Verkler Motor Express, secured an order for the shipment of goods from the Grand Rapids Store Equipment Corporation to Kresge’s store at Harvey, Illinois. These goods (counters and store equipment) were shipped under a uniform bill of lading; the rates being fixed by .the official classification “made by the committee on railroads of the Hnited States.” The Verkler Motor Express did not have sufficient equipment to handle the shipment, and Harry Willard, its traffic-representative, got into communication with Lee D. Laraway, the office manager of Fred Cochran, doing business as City Transfer & Storage Company, the defendant, and asked if his company would take a load of the counters to Chicago for the Verkler company. Lara-way fixed the price for the service at $50, and this was assented to by Willard.
Willard later informed Laraway that the load was ready to move, and Laraway sent a truck, consisting of a tractor and a long body trailer, to the warehouse of the equipment company for loading. Harold Beunk was in charge thereof. Willard assisted Beunk in the loading, and Beunk claims he protested against the putting of a third tier of crates on the truck, but was assured by Willard that it was all right to do so. Willard indicated to Beunk the best route to take to reach Chicago. Beunk drove the truck back to defendant’s yards, and, being unable to make the trip himself, called another employee, Clarence Barrett, to do so.
While en route the truck tipped over, and the goods were damaged to the extent of $1,277.40. The Verkler company carried insurance on goods thus transported with the plaintiff company. It paid the loss to the equipment company, and secured a release to the Verkler company therefor and also a subrogation receipt for all rights of recovery against the defendant on account of said loss. It thereupon brought this action, and, on trial by the court without a jury, was awarded a judgment for the amount above stated, from which the defendant seeks review by appeal.
The liability of the defendant was predicated upon the fact that it was engaged in business as a common carrier. The trial court so found. In this the defendant claims he was in error. Plaintiff’s counsel rely on the testimony of Mr. Laraway to support this finding.
He testified on direct examination:
“The company maintains storage of goods at their place, and a trucking business. The larger part of it is trucking. At the time of the accident they had eight trucks, all owned by the company.
“The company did not maintain any definite route between any definite points; they did not op erate trucks at that time on any set schedule; they did not advertise or hold out to the public that they operated trucks between definite points at definite times. They obtained their business by people calling the company and asking them to do certain jobs. The terms under which each particular job was done would be arranged at the time that the parties called, and if they got together, then they would do the job. Each trip would be a trip that they would figure on with the party calling. If it were not for the party calling and requesting them to make the trip the trucks would not have been making the trip.
“They did not take all of the jobs that were presented. It would depend more or less on the price and whether or not we would be able to handle it. * # '* It has never been our custom in making a trip to Kalamazoo, Chicago, or any other place, to solicit business at the other end of return freight. The price for making these trips in hauling goods for definite parties was arranged at the city before we left on the trip, and was arranged for the whole trip, and when goods were to be returned arrangements were made to include the goods to be returned. In one load we would never carry goods for more than one person. On some occasions when we were making a trip for one person to a certain point if another person had goods coming back from that point we would make arrangements to bring the goods back with the other person.”
And on cross-examination:
“Q. You were in the general trucking and hauling business ?
“A. Yes, sir.
“The Court: Q. Did you do business for any-
body that applied, as long as you could agree on the terms 1
“A. Yes.
“Q. And as long as you had trucks to handle them?
“A. If we got a call to make a trip and the price could be agreed upon.
“Q. You would do it for anybody that terms were satisfactory?
“A. Yes, sir.
“Mr. Riddering: Q. And you would drive anywhere within reason that the company wanted you to drive, would you?
“A. Yes, sir. ,
“Q. You had no limits as to distance?
“A. No.
“Q. Nor routes?
“A. No.
“ Q. But any person who would call you and pay the price you asked to get their goods caifried by you?
“A. In case we had the equipment.
“Q. If you had the equipment available at that time?
“A. Yes, sir.
“Q. It wouldn’t make any difference to you whether or not you had ever carried any goods for this particular person or knew that he was a good risk so far as payment was concerned?
“A. We would make the trip.
“Q. You would make the trip?
“A. Yes, sir.
“Q. A perfect stranger might come in and if he would offer you payment in advance you would carry the load?
“A. Yes, sir.
“Q. So that as far as you had facilities and as long as you had trucks that were not on the road, you were ready to carry for anyone who could pay your price?
“A. Yes, sir.”
A somewhat similar question was presented in Re Border Cities Trucking Co., 261 Mich. 385, and in Re Columbian Storage, etc., Co., 261 Mich. 390. •In the first of these cases, the statute (Act No. 312, Pub. Acts 1931), providing for the classification and regulation of carriers for hire, was construed and the distinction between a public carrier and a private carrier pointed out. It was there said of an applicant for a permit as a private carrier:
“He has and exercises the right to take what freight he chooses. His business is upon the principle of profit to himself, not upon obligation to the public as a public carrier. * * * He has preserved his right to discriminate.”
In Michigan Public Utilities Co. v. Duke, 266 U. S. 570 (45 Sup. Ct. 191, 36 A. L. R. 1105), the court said:
“One bound to furnish transportation to the public as a common carrier must serve all, up to the capacity of his facilities, without discrimination and for reasonable pay.”
The distinction is pointed out in 4 R. C. L. pp. 549, 550, as follows:
“The authorities recognize two classes of carriers, vis., private carriers and common carriers. All persons who undertake for hire, to carry the goods of another, belong to one or the other of these classes. * # * The former are not bound to carry for any reason unless they enter into a special agreement to do so. The latter are bound to carry for all Who offer such goods as they are accustomed to carry and tender reasonable compensation for carrying them; and if they refuse to perform their obligation in this respect, they are liable to respond in damages.”
"While some confusion may have arisen in the discussion of this question in certain of our cases, owing* to the language used hot being strictly confined to the facts presented, it seems clear that the de-' fendant at the time of the transaction in question was not engaged in business as a common carrier.
The judgment is reversed and set aside, and the cause remanded, with directions to enter a judgment for the defendant, with costs of both courts.
McDonald, C. J., and Clark, Potter, North, Fead, "Wiest, and Butzel, JJ., concurred. | [
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Potter, J.
October 6, 1931, plaintiff filed a bill to compel defendant Edward Leroy Chambers to execute a chattel mortgage in the sum of $7,000, as security for the payment of rent claimed to be due on a lease of real estate, to be placed on the personal property in the demised premises; to require defendant Winifred McDonald to give a written release of any and all interest which she had or claimed to have in such personal property; to decree that Chambers pay the amoiint due plaintiff and to perform the lease entered into by him; to permit plaintiff to hold the sum of $1,650 deposited with him by defendant Chambers as security, and apply the same on the indebtedness of Chambers to plaintiff, and, in default thereof, that plaintiff have his rights established by decree; for injunction against defendants Chambers, McDonald, and Crowley, Milner & Company, or their assigns, for foreclosure of the lease held by Chambers, and for other relief.
The case was heard, and March 22, 1932, decree ordered by the trial court. July 16, 1932, there was substitution of attorneys and a motion made by such substituted attorneys to reopen the proof and for leave to file a cross-bill. This motion was heard August 4, 1932, denied by the trial court, and on the next day final decree was entered. August 6, 1932, a formal order was entered denying defendants’ motion to file a cross-bill, whereupon defendants appealed from the order of the trial court denying their motion for leave to file a cross-bill and reopen the proofs before the entry of decree.
The rule is that in general a cross-bill should be filed at the time of the answer if it is a part of the defense, and the. old rule in England was that it should be filed before publication, which would be substantially in this State before the closing of the testimony. Monmouth Co. Mutual Fire Ins. Co. v. Hutchinson, 21 N. J. Eq. 107; 5 Enc. Plead. & Prac. pp. 653-665.
The testimony was closed and the trial court had announced its decision, though no formal decree had been entered, when there was substitution of attorneys and motion for leave to file a cross-bill.
“A cross-bill will not be permitted to be filed when there has been unreasonable delay. ” Howison v. Ruprecht, 121 Ill. App. 5.
“Where a defendant desires to file a cross-bill in a chancery proceeding he should act with due diligence and file the same without unreasonable delay, with a view to having it heard with the original bill.” Kelsey v. Clausen, 257 Ill. 402 (100 N. E. 984).
“The court will not suspend the hearing of the original cause on account of a cross-bill, when that cross-bill has been filed at an unreasonable period.” Baker v. Oil Tract Co., 7 W. Va. 454.
“It" is proper to say, that we do not approve of the practice of filing a cross-bill after the original suit has been heard and its merits passed on.” Bronson v. Railroad Co., 2 Black (67 U. S.), 524.
“When a cross-bill is necessary to the complete determination of the matters already in litigation, the court may permit one to he filed at any time before'the hearing. To grant or to refuse permission to -file a cross-bill is largely in the discretion of the court. Morgan’s, etc., Co. v. Railway Co., 137 U. S. 171 (11 Sup. Ct. 61). The courts generally disapprove of the filing of a cross-bill after the original suit has been heard and the merits have been passed on.” Huff v. Bidwell, 81 C. C. A. 43 (151 Fed. 563).
The authorities all recognize that a cross-bill may be filed, upon leave of the court first obtained, even after hearing. In some cases, after the entry of final decree, such decree may be set aside and leave to file a cross-bill granted. It is equally well settled that after a case has been heard, leave to file a cross-bill may be granted or denied in the discretion of the trial court. This court will not review matters discretionary with the trial court. It may act if the trial court’s discretion is abused. We find no abuse of discretion in this case.
Decree affirmed, with costs.
McDonald, C. J., and Clark, Sharpe, North, Fead, Wiest, and Btttzel, JJ., concurred. | [
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Butzel, J.
Cornelius Hasper, defendant, while engaged in the automobile business in Muskegon, sold a truck for $376.40 on a conditional sales contract to one Lee. He discounted the contract with the National Discount Corporation, plaintiff herein. In assigning the contract, defendant gave a specific and absolute guaranty of future payments and stipulated that, in the event of default of the vendee, plaintiff was authorized to repossess and deliver the truck to defendant. Upon delivery, the latter agreed to pay immediately the full amount due, together with all expenses of repossession. The contract further provided that the guaranty should be a continuing one until all payments, terms, and conditions were fully paid and performed.
Lee, the original vendee under the contract, defaulted. Plaintiff repossessed the car, delivered it to a garage where defendant had been employed following discontinuance of his auto business, and demanded full payment of the balance. Defendant admitted that he was still bound, and, when a party by the name of Deeter became interested in the purchase of the truck through plaintiff’s efforts, de fendant not only saw Deeter bnt agreed to contribute towards the expense of repairing the truck, so as to effect the sale. There is some dispute in the testimony as to whether defendant agreed to the terms on which Deeter was to purchase the car. Defendant admitted that he considered himself still bound to plaintiff and offered to assume $25 or $30 on the last payment due on the contract. There was $47.50 past due on the contract at the time of the Deeter transaction. Defendant claims that the following conversation took place between himself and plaintiff’s manager:
“And I said that I was willing to assume $25 or $30 to apply on that last payment. And he said, ‘What kind of terms' can you make to this man, Deeter"? ’ And I said, ‘He is to bring the contract up to date.’ And he said, ‘If we can make a deal, he will make $20 now and $20 each week thereafter. He wanted to get out on the job in the morning and make the trip and wanted to get started.’ ”
Plaintiff’s witnesses testified that the best terms they could get from Deeter were a down payment of $15 and $20 a week thereafter. Upon payment of $15, which was credited to defendant’s account, Deeter took possession of the truck, but it broke down on the very first trip, and he refused’to make the purchase, owing to its alleged defective condition. Deeter employed the car in the hauling of pulp wood, a use regarded as very wearing on a truck. It was finally returned to the garage where defendant worked.
Defendant claims that he was released from his guaranty by the attempted sale to Deeter. The trial judge held that plaintiff had failed to make out a case, had not sustained the burden of proof, and that defendant was released from the guaranty.
Defendant was not an accommodation surety or guarantor. Rose v. Ramm, 254 Mich, 259; Grinnell Bealty Co. v. General Casualty & Surety Co., 253 Mich. 16. He made an absolute and unconditional promise to pay the amount of the contract in event of default by the vendee. In consideration of it, he was paid the amount due thereunder, less the discount exacted by plaintiff. We need not discuss the question of novation, for the evidence discloses no intention to substitute Deeter for defendant as the party bound to perform. At most, it was an attempted sale. No written contract was executed, and the truck was returned to the garage at which defendant was employed, Defendant claims that the truck was never actually returned to his possession. The testimony shows conclusively that he was notified of its return and the fact that it was being held for his benefit.
The chief defense raised is that plaintiff misrepresented the terms of the sale, and that defendant would never have rented or sold the truck on a deal calling for such a small down payment, especially in view of the wearing use to which the truck was to be put. The most, then, defendant may claim is an impairment of the plaintiff’s security, on account of which defendant might hold plaintiff responsible. Such an impairment does not release the guarantor from liability except to the extent that the security has been damaged. Central State Bank v. Ford, 181 Iowa, 319 (164 N. W. 754); First International Bank v. Beiseker, 43 N. D. 446 (175 N. W. 637).
Plaintiff made out a cause of action. If the judge should find on a new trial that the truck was damaged to the extent of more than $15 as a result of its use by Deeter, and that the attempted sale to Deeter on the terms stipulated was unauthorized, then de fendant would be entitled to a deduction from tbe total sum due plaintiff to tbe extent of any damage to tbe truck over and above tbe $15 already credited bim.
Tbe judgment of the lower court is reversed, with costs to plaintiff, and a new trial ordered.
McDonald, C. J., and Clark, Potter, Sharpe, North, Pead, and Wiest, JJ., concurred. | [
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] |
Sharpe, J.
The defendant Wilson was the owner of two trucks, which were engaged in hauling freight from Chicago to Grand Rapids for the defendant Nixon on February 3, 1930. The rear truck was driven by the defendant Keene. When near the city of Gary, Indiana, and at about 10 o’clock at night, the forward truck, driven by Wilson, became somewhat disabled and the lights on it went out. Keene stopped his truck behind it and went forward to aid in its repair. His truck was fully equipped with rear lights, as provided by the laws of Indiana. While he was so working, he heard a crash and discovered that a car, owned and driven by the plaintiff, had collided with the rear end of the truck he had been driving.
3 Burns Ann. Indiana Statutes 1926, § 10150, reads as follows:
“It shall be unlawful for any person to park a motor vehicle, or motor bicycle or to leave any such motor vehicle or motor bicycle, without an attendant, on the traveled portion of any highway outside the corporate limits of any city or town, except in case of an emergency. ’ ’
The negligence on the part of the defendants rests upon the claim that their truck was parked on the pavement in violation of this statute. In disposing of it, the trial court said:
“Mr. Keene, after stopping his truck on the right-hand side of the road at the rear of Mr. Wilson’s truck, went up to help Mr. Wilson repair his truck. I would call that just an emergency on the highway, that one automobilist, if he knows enough' about doing the repairs, and wants to render a service to the other man, it is a service he has a right to render to the other fellow there who is in trouble, if he sees to it that the rear end of his own vehicle or car is properly protected by lights.”
The collision having occurred in the State of Indiana, the general rule is that all matters relating to the right of-acti<5n are governed by the laws of that State, and all matters relating purely to the remedy to the laws of the State in which the action is brought. Our attention has not been called to any decision of the Supreme Court of Indiana in which a construction has been placed upon the language of this statute. We therefore construe it as we would a like statute in this State. 59 C. J. p. 946.
The Michigan act regulating the operation of vehicles on highways (1 Comp. Laws 1929, § 4693 et seq.) contains the following provision:
Section 4718. “It shall be unlawful to park a vehicle on the beaten track or paved surface of any highway outside the limits of any village or city. ’ ’
In section 4693, “parking” is defined as—
“Standing a vehicle, whether occupied or not, •upon a highway, when not loading or unloading except when making necessary.repairs.”
In Sahms v. Marcus, 239 Mich. 682, 685, it was said:
“There is a difference between stopping and parking. The general purpose of the statute appears to be aimed at dead vehicles, i. e., vehicles that are unable to move under their own power and are left standing on the pavement. It is also aimed at live vehicles that are able to move under their own power but are left standing on the pavement without watchman or caretaker, and also to vehicles that are able to move but are standing on the pavement to serve some purpose of the occupant or occupants. "We think the idea of the legislature was to keep the improved highways open for travel and free from non-moving vehicles. This purpose would not prohibit a temporary stop for a necessary. reason. See 1 Blashfield’s Cyclopedia of Automobile Law, p. 558.”
While our statute makes no provision for an emergency, it has been construed as though it so provided. In Bowmaster v. William H. DePree Co., 258 Mich. 538, the defendant had stopped his car upon the pavement, and upon the wrong side of the highway, to render assistance to the driver of a disabled car which was in the ditch. Mr. Justice McDonald, speaking for the court, said:
“It is true that their obstruction of the road set in motion u series of events that culminated in the accident; but, under the circumstances, the act of obstruction was not in itself negligence. They were rendering assistance to a fellow autoist whose car had skidded from the road into a ditch. They were lawfully using the highway. 42 C. J. p. 1041.”
In 3-4 Huddy on Automobile Law (9th Ed.), p. 104, the writer says:
“Under the automobile statutes the term ‘park’ has been defined by the courts as meaning, in sub stance, the voluntary act of leaving a car on the main-traveled portion of the highway when not in use. It means something more than a mere temporary or momentary stoppage on the road for a necessary purpose. ’ ’
Keene was in the employ of the defendant Wilson, and when he overtook the truck driven by Wilson and found that it was disabled, that its lights were out, it was his duty to assist in its repair. He saw to it that the lights on the rear of his truck were all lit, in compliance with the requirements of the Indiana statute. Owing to the banks of snow on the side of the highway, he had no opportunity to remove his truck off the pavement. Under these circumstances, we find no error in the holding of the trial court that the driver of the truck was not guilty of a violation of the Indiana statute.
Counsel for the plaintiff rely on the decision in Camp v. Wilson, 258 Mich. 38, but it will be observed that the negligent act there complained of was the absence of a tail light on the disabled truck.
The trial court was also of the opinion that the injury plaintiff sustained was due to the negligent manner in which he drove his car after discovering the lights on the rear of the truck, but, in view of the conclusion above reached, decision thereon is unnecessary.
The judgment is affirmed.
McDonald, C. J., and Clark, Potter, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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Butzel, J.
Ruth M. Smith filed a bill for absolute divorce from George H. Smith, on the ground of cruelty. He denied the charges, and in a cross-bill charged her with refusal to cohabit and failure to perform other marital duties. After taking considerable testimony, the judge rendered a decree in her favor.
The testimony established the baselessness of defendant’s charges, except as to those actions of plaintiff that were justified by defendant’s conduct. It showed that defendant remained away from plaintiff’s bedside for the 36 hours following the birth of their youngest .child, and then when he saw her he upbraided her for having the child; that he insisted upon keeping the radio going long after reasonable hours, when the plaintiff and the children were trying to rest, and that he had insisted that it be kept going even when he absented himself from home; that he constantly referred to her in an insulting manner; and that he was guilty of other acts of cruelty towards her and the children, the details of which it is unnecessary to discuss.
In the decree, the trial judge awarded plaintiff the custody of the children, aged 12, 11, and 7, respectively. He gave her the household goods and effects and also the homestead, burdened with a mortgage of $3,000 running to defendant’s father. (See Smith v. Smith, ante, 60.) He also decreed that the tenancy by the entireties in an oil station property near East Lansing, Michigan, rented for $100 per month, should hereafter be a tenancy in common; that defendant further pay plaintiff $1,500, which, until paid, should be a first lien on defendant’s interest as tenant in common of the oil station property. He further ordered defendant to pay $30 a month towards the support of the children. This left defendant with a small equity in another house in Lansing and the full ownership of another oil station property in the same city, not as valuable at the present time as the one in East Lansing.
We believe the decree is fair and proper and fully sustained by the evidence. In coming to this conclusion, we are not unmindful of the fact that plaintiff has inherited, from, her father an 80-acre farm near Williamston, Michigan, as well as a small amount of personal property.
The decree is affirmed, with costs to plaintiff. •
McDonald, C. J., and Clark, Potter, Sharpe, North, Fead, and Wiest, JJ., concurred. | [
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Clark, J.
Defendant was permitted to appeal from denial of his motion to dismiss, the ground of the motion' being that the action was barred by a statute of limitations. 1 Comp. Laws 1929, § 4232. The action is for personal injuries in a collision of automobiles, averred to be due to negligence of defendant in failing to drive on the right side of the highway.
The question is: “Is 1 Comp. Laws 1929, § 4232, limiting to one year the time for commencement of actions for the recovery of damages arising out of automobile collisions, where one vehicle was on the wrong side of the road, impliedly repealed by the uniform motor vehicle act of 1927 (Act No. 318, Pub. Acts 1927 [1 Comp. Laws 1929, § 4693 et seq.])1”
1 Comp. Laws 1929, § 4231, part of the Eevised Statutes of 1846, re-enacted by Act No. 283, Pub. Acts 1909, appearing in substance in Act No. 318, Pub. Acts 1909, motor vehicle law, and in Act No. 9, Pub. Acts 1919, was the well-known law of the road, requiring turning or driving to the right upon meeting, and otherwise permitting a driver to use any part of the traveled portion of the highway. The section 4232 provides a penalty for violation of this law of the road with limitation of action and also of action for damages with limitation of one year.
But the law of the road in respect of vehicles has been changed. It is no longer turn to the right. It is Jceep to the right. The uniform motor vehicle act (Act No. 318, Pub. Acts 1927, 1 Comp. Laws 1929, § 4703 et seq.) requires the vehicle to be driven “upon the right half of the highway” with two exceptions, (a) in overtaking and passing*, and (b) where it is impracticable to travel on the right side; and the statute repeats that vehicles in meeting* must pass to the right. Act No. 318, Pub. Acts 1927, made a new law of the road and repealed by implication, as to vehicles at least, the former law
of the road, section 4231, and with it, in that, regard, section 4232, providing for penalty and damage.
The general statute of limitations, 3 Comp. Laws 1929, § 13976, providing a limitation of three years, is applicable.
Affirmed.
McDonald, C. J., and Potter, Sharpe, North, Fead, Wiest, and Btjtzel, J J.; concurred. | [
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Sharpe, J.
Plaintiff brought ejectment to recover the possession of land in the county of Midland for which he has a tax homestead deed, executed on May 14,1928, and recorded on December 11th of that year. The defendant Charles Denton is the owner of this land, as appears in the regular chain of title thereto. May Denton is his'wife. It is conceded that the records in the auditor general’s department show that the provisions of 1 Comp. Laws 1929, §§ 3520-3522 (Act No. 206, Pub. Acts 1893, §§ 127, 127a, 128, as amended), under which such deed was issued, have been complied with. The defense is based upon the claim that the certificate of determination of the auditor general and director of'conservation, required by section 3520 to be made before tbe issue of such deed, was not signed by the director of conservation until after he had retired from that office on January 10, 1927. It is also urged that the amendment to the tax homestead law (Act No. 107, Pub. Acts 1899), hereafter referred to, is unconstitutional and void.
The trial court held that this act was constitutional. He also held that—
‘ ‘ The deed from the State to the plaintiff is regular in form; contains recitals showing full compliance with legal requirements, and is conclusive evidence of title in the grantee. ’ ’
A judgment was entered for the plaintiff, from which the defendants have taken this appeal.
Section 3527, under which the plaintiff’s deed was issued, provides:
“Such deed shall convey an absolute title to the lands sold, and shall be conclusive evidence of title in fee in the grantee. * * * And in all cases where, the lands have been taken as a homestead as set forth in last foregoing proviso, all actions of ejectment or to recover possession of said lands or to set aside the title of such homesteader by any person, firm or corporation claiming the original or government title, shall be commenced within six months after this act shall take effect, and not afterwards.”
The deed from the auditor general to the State of Michigan was executed on November 16, 1923, and recorded on January 7, 1924. 1 Comp. Laws 1929, § 3724, reads, in part, as follows:
“After the expiration of six months from and after the time when any deed made to the State under the provisions of section one hundred twenty- seven of act two hundred six of the public acts of eighteen hundred ninety-three, being the general tax law, and acts amendatory thereto, shall have been recorded in the office of the register of deeds for the county in which the land so deeded shall be situated, the title of the State in and to the same shall be deemed to be absolute and complete, and no suit or proceeding shall thereafter be instituted by any person claiming through the original or government title to set aside, vacate or annul the said deed or the title derived thereunder. ’ ’
This deed contains recitals of the facts which must exist under section 3520 to justify its execution. But counsel for the defendants insist that the recital of determination contained therein “is not true” because the signature of the director of conservation was not annexed thereto until after his retirement in January, 1927.
While it may well be said that there is conflict in the. evidence as to when the determination was signed, we agree with the trial court that, if defendants ’ contention in this respect be sustained, it is not controlling of decision. Had examination been made of the records in May, 1928, when plaintiff secured his deed, a full compliance with all of the statutory requirements would have been revealed thereby. No imperfections appear on the face of his deed or of the deed to the State of Michigan. The statute under which plaintiff’s deed was issued (section 3527) provides, as before stated:
“Such deed shall convey an absolute title to the lands sold, and shall be conclusive evidence of title in fee in the grantee. ’ ’
This statute and those limiting the right to attack the validity of deeds issued by the auditor general to the State have been many times considered by this court. In Chiodo v. Williams, 180 Mich. 367, the purchaser under a State tax deed sought to recover possession by a writ of assistance. The regularity of the tax proceedings was questioned by the original owner. The court said:
‘ ‘ The statute gave him six months after the deed to the State was recorded in Muskegon county to contest its validity. Having failed to question the proceedings within that time, he will now be precluded from doing so. Section 127, general tax law. ’ ’
See, also, Darrow v. Railway Co., 188 Mich. 664.
That plaintiff’s deed was not subject to the attack made upon it has been many times decided. In Grand Rapids Trust Co. v. Doctor, 222 Mich. 248, 255, it was said:
“The deed from the land commissioner to Torrent was in full form with recitals showing compliance with the law. As such it could not be and was not questioned. When introduced in evidence, .it not only made ¿ prima facie case for plaintiff, but was, under the statute, conclusive evidence of title in fee in the grantee.”
The earlier cases were reviewed at some length in the recent case of Price v. Stark, 259 Mich. 407. It was there said:
“These decisions seem conclusive that the rights of a former owner have been absolutely cut off by a deed from the State of State tax homestead lands where no attack is made upon it within six months after its execution. ’ ’
Under section 127 of the general tax law (Act No. 206, Pub. Acts 1893), before delinquent lands could be deeded over to the State and become State tax homestead lands, it must have appeared that they were “barren, swamp or worthless lands,” and had been abandoned by the owner. This section was amended by Act No. 107, Pnb. Acts 1899 (1 Comp. Laws 1929; § 3520). The first sentence thereof now reads as follows:
“Lands delinquent for taxes for any five years, where said lands have been sold and bid off to the State for the taxes of one or more of the said years, and then so held, and no application having been made to pay, purchase or redeem the said lands for said taxes and no action pending to set aside such taxes or to remove the cloud occasioned thereby, shall, within the meaning of this act, be deemed abandoned lands, unless such lands are actually occupied by the person having the record title thereto.”
Counsel for defendants claim that this amendment “violates the Federal Constitution.” While not so stated, we assume that the due process provision (14th Amendment) is referred to. The omission of the words “barren, swamp or worthless” from the finding required to be made does not, in our opinion, affect the constitutionality of the amendment. Such land, when deeded over to the State, is subject to sale, and is often purchased, as was that here involved. Unless needed as part of a reserve or for other special use, the State does not want the lands. If only those found to be “barren, swamp or worthless” are included, then but few, if any, descriptions would be sold. The purpose of this omission seems clearly to have been to enable the State, by proper proceedings, where the owner has neglected to pay his taxes for five years and has abandoned the land, to sell the same, but such sale may not be had at less than an appraised value which has been placed thereon. By such sale the State will not only secure the payment of the whole or at least a part of the delinquent tax, but have a person in ownership thereof who will probably see that no such delinquency again occurs.
This case was tried by the court without a jury. Its findings of fact were justified by the evidence submitted, and its judgment, rendered in favor of plaintiff, is affirmed.
McDonald, C. J., and Clark, Potter, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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North, J.
After instituting the main suit, plaintiff garnisheed the First Wayne National Bank of Detroit, which later disclosed indebtedness to the principal defendant in the sum of $4,035.80. Three days prior to this disclosure an order was entered in the circuit court granting defendant’s motion to dismiss plaintiff’s suit; but a stay of 20 days was ordered within which to appeal. During the stay period plaintiff perfected an appeal to this court from the order and judgment dismissing his suit. Decision on appeal resulted in affirmance of the judgment entered in the circuit court. Rosenthal v. American Construction & Realty Co., ante, 91. On the day following disclosure by the garnishee defendant, the principal defendant petitioned the circuit court for an order releasing the garnishment. This petition was not heard by the court until after the appeal to this court had been perfected. On the day of hearing the circuit judge ordered release of the garnishment, and further:
“That the garnishee defendant herein * * * do forthwith release the defendant’s bank account garnisheed under said writ of garnishment and do forthwith release and surrender to the defendant at its request all sums of money and other property now held by the said garnishee defendant, * * * under the aforesaid writ of garnishment.”
Notwithstanding this order of the court, the garnishee defendant refused to pay to the principal defendant the money of which it had disclosed possession. This evidently was because the garnishee defendant considered itself still contingently liable to plaintiff under the writ of garnishment, since the record disclosed an appeal from the order of dismissal of the main case. But there having been affirmance in this court and final dismissal of the main case (Rosenthal v. American Construction & Realty Co., supra), the ancillary garnishment pro ceeding is now also at an end; and the question raised by appellant herein as to whether the garnishment remained in effect pending the appeal is now moot. We forego discussion and decision because it is intimated in appellee’s brief that dismissal of the garnishment was on other and justifiable grounds, such as were made the basis of dismissal of the garnishment proceedings in Shank v. Lippman, 258 Mich. 225.
But this record also discloses that the circuit judge imposed a fine of $100 upon the garnishee defendant for contempt in refusing to comply with the court’s order that the garnishee defendant should “forthwith release and surrender to the defendant at its request all sums of money” held in the garnishment proceeding. From this judgment of the circuit court in the contempt proceeding the garnishee defendant has appealed. The point is made by appellant relative to paying* to the principal defendant the money which appellant held as garnishee defendant, that the relation of the two parties was simply one of debtor and creditor and that the creditor (appellee) had a complete remedy at law and (if entitled to the money) could recover judgment and have execution therefor; and that therefore the circuit court was in error in attempting to coerce payment or delivery of the money by contempt proceedings. Appellant’s position is sound in law.
“We have no difficulty in holding that the process of contempt to enforce civil remedies is one of those extreme resorts which cannot be justified if there is any other adequate remedy. * * * Payment of money can only be enforced by attachment ‘where by law execution cannot be awarded for the collection of such sum.’ ” Haines v. Haines, 35 Mich. 138.
See, also, North v. North, 39 Mich. 67.
“Where collection of money due on contract between private parties can be enforced in simple action at law by execution, party may not be imprisoned for contempt for failure to pay it to clerk upon order of court (3 Comp. Laws 1915, § 12268, subd. 5 [3 Comp. Laws 1929, § 13910, subd. 5]).” Brownwell Corp. v. Ginsky (syllabus), 247 Mich. 201, citing several other decisions of this court.
The order of the circuit court adjudging appellant guilty of contempt and imposing a fine is set aside. Costs to appellant.
McDonald, C. J., and Clark, Potter, Sharpe, Wiest, and Butzel, JJ., concurred. Fead, J, did not sit. | [
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North, J.
Plaintiff, a young lady 21 years of age, while coasting on a bobsled on Naylor street in the city of Grand Rapids, came in contact with an automobile owned by the defendant Martin E. Knoll, but at the time in charge of his son, Allen Knoll. Upon trial by jury, plaintiff had verdict and judgment. The defendants have appealed.
Naylor street extends in an easterly and westerly direction, and between its intersection with Grand-ville street and its intersection with Century avenue, a block east of Grandville, there is a downgrade in an easterly direction. The municipal authorities permitted coasting on this section of Naylor street. For this purpose an icy strip about 3 feet in width and about 8 feet from the southerly curb and 13 feet from the northerly curb was formed by sprinkling the snow which had fallen upon this portion of the street. ■ On either side of the ice slide or ice track, as it was called, there was loose snow. The park department of the city of Grand Rapids placed a barrier across the south half of Naylor street at Grandville and the north half at Century avenue about eight feet long, with a lantern hung thereon and a sign reading “Caution, Coasting Allowed.” But the street was not closed to vehicular traffic. On the evening of the accident, about eight o’clock, the defendant Allen Knoll drove his father’s automobile into the driveway adjacent to the Becker home, where he and a young man companion were calling relative to some matter of business. This driveway is on the southerly side of Naylor street and 150 feet easterly from the top of the hill on which plaintiff was coasting. Having finished his call at the Becker home, Allen Knoll and his companion returned to the automobile, backed the car out of the driveway across the iced track on which the bobs coasted, and continued in a northwesterly direction until the left rear wheel was against the northerly curb of Naylor street. Plaintiff’s proof was to the effect that the bobsled on which she was riding was on its way down hill about 125 feet from the Becker driveway when the Knoll automobile was backed into the street. Defendants’ witnesses testified that when the automobile was backed into the street the bobsled was not approaching from the top of the hill; and defendants’ witnesses further testified that after stopping the automobile at the northerly curb of the street it was not moved again until after the accident. But plaintiff’s witnesses testified that while the car was standing against the curb it was entirely clear of the strip used for coasting, and that as the bobsled approached the point where the automobile had crossed the coasting strip the car started forward a distance of one to three feet. There is some variance as to whether the bobsled pursued a straight course along the icy track or whether as it approached the point of the accident it veered slightly. In any event the sled itself did not come in contact with the automobile, but it did go within such proximity that plaintiff’s left limb came in contact with some portion of the auto and with such force that the sled left the icy slide and overturned. None of the other occupants of the sled were injured, but plaintiff received a cut on her left leg below the knee, her ankle was sprained and bruised and one of her arms somewhat injured. The defendants deny being guilty of the negligence charged against them, which in effect was that defendant Allen Knoll drove said automobile into and against the bobsled upon which, plaintiff was riding’.
Appellants assert that prejudicial error resulted from repeated inquiries by plaintiff’s counsel dur ing the voir dire examination of the jurors as to their being interested in or having stock in an insurance company. Proper practice in this particular has been so recently indicated by decisions of this court that we deem further discussion unnecessary. Holman v. Cole, 242 Mich. 402; Palazzolo v. Sackett, 245 Mich. 97; Harker v. Bushouse, 254 Mich. 187. On this record we are not prepared to say that these inquiries of the jurors were not made in good faith. As a basis of challenging jurors, plaintiff’s counsel was entitled to make proper inquiry in this field. But later, plaintiff, as a witness in her own behalf, upon being asked by her counsel what Allen Knoll said to her the day following the accident, replied:
“A. He said he was covered with insurance.
“Plaintiff’s counsel: No, you can’t say that.
“Mr. Rodgers: Counsel drew that out deliberately, and I renew my motion for a mistrial on the previous ground and—
“The Court: She would be entitled to testify to it. What is the idea of being afraid of anything like that? She is entitled to say what he said about the accident. * * * What he said is perfectly competent. * * * When a man has an'accident, anything said about, concerning, or pertaining to the accident, after the accident, is admissible, no matter what subject he may refer to if it has any bearing'on the accident itself, or the cause of the accident; perfectly admissible.
“Q. (Plaintiff’s counsel): Just go ahead and tell what he said.
“A. He said he was covered with insurance, and he would see the insurance company about it.
“Mr. Rodgers: I again ask that that be stricken out and again ask for a mistrial.
“The Court: If it has any bearing upon the question of liability it is perfectly competent. It is for the jury to say. The motion for mistrial is without foundation, and denied.”
The statement, if made by Allen Knoll, was not an admission of liability, nor did it bear at all upon the question of his having been guilty of negligence, which was a proximate cause of plaintiff’s injuries. It was not relevant or competent testimony as to any issue before the jury. It was unquestionably prejudicial, especially so in view of the understanding the jurors must have had from the trial court’s statement:
“If it has any bearing upon the question of liability it is perfectly competent. It is for the jury to say.”
Error is assigned upon the cross-examination of defendant Allen Knoll and of Dwight Lamoreaux,' who accompanied Knoll at the time of the accident; and- error is also assigned upon the subsequent use made of this testimony by plaintiff’s counsel in arguing the case before the jury. In part, the cross-examination of Allen Knoll was as follows:
“Q. And if you had parked your car at the curb on the north side of Naylor street, it wouldn’t have been necessary for you to cross that ice path at all?
“Mr. Rodgers: I object to that, incompetent and immaterial. There is no obligation for him to park his car on the north side.
“The Court: Well, he may answer. * * *
“A. Yes and no on that question. It would be very dangerous leaving a car out there, but it could be left there.
“Q. You could have parked a car on the left side?
“A. I could have, but it would have been a dangerous thing to do. * * *
“Q. And there was nothing to prevent you from parking at the north curb, was there?
“A. No.
“Q. And if you had parked there, you would not have had to drive your car across this ice path where the children were sliding down, would you?
“Mr. Rodgers: Same objection.
“The Court: He may answer. *
“A. No, sir.”
There was cross-examination of defendants’ witness Dwight Lamoreaux of like character. Defendants’ counsel moved to strike this testimony and stated to the court that there was no allegation of negligence based on failure to park the car in the street instead of in the driveway of the Becker home, and that there was no obligation resting on the driver of the automobile to do so. The objections made were overruled and the motion to strike denied. Before the jury, plaintiff’s counsel argued that the automobile should have been parked at the curb opposite the Becker driveway and by so doing “avoid any possibility of an accident.” Objection was urged to the argument and the court requested to instruct the jury to disregard it, this on the ground that the manner or place of parking the car was not alleged as negligence. The trial court disposed of defendants’ objection and requests as follows :
“The jury has heard the testimony, and if the argument is not helpful in weighing and determining the testimony and determining the question of negligence, then they will disregard it. If it is helpful, they can use it for what it is worth.”
The cross-examination was improper and the use made of the testimony thus gotten into the record by plaintiff’s counsel was clearly prejudicial.' This is especially true in view of the undisputed testimony that the accident did not occur when the automobile was being driven into or when it was being backed out of the driveway. If the driver was guilty of any negligence it was in driving the automobile forward after he had backed it across the street to the north curb. Conclusively driving into or backing out of the driveway was not the proximate cause of the accident. As stated in appellee’s brief:
“In short, the only disputed question of fact in the case was whether defendants’ car moved forward from its position against the curb.”
Error is also assigned on the charge to the jury. In part the court charged :
“So, in this case, after the bob started from the top of the hill, if the slide was clear when they started, the testimony was they could not stop the bob going down the slide, and the law does not require that it shall stop; and anybody down the hill, it is their duty not to get in the way of that bob, because the bob cannot be stopped.”
Appellants’ objection is thus stated:
‘ ‘ Our' criticism here is that this instruction stated the mutual rights and responsibilities of the plaintiff and defendant more favorably to plaintiff than the law permits.”
"Without holding that the case should be reversed on that account, we may note that the “duty not to get in the way” of those coasting down the hill was not (as the jury might have understood) an absolute duty. Instead, others using the street were bound to exercise reasonable care, such care as was commensurate with the known use that was being made of that portion of the street where coasting was permitted.
For the reasons above stated, the judgment entered in the circuit court will be set aside, and a new trial ordered. Costs to appellants.
McDonald, C. J., and Clark, Potter, Sharpe, Fead, Wiest, and Butzel, JJ., concurred. | [
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Per Curiam.
Defendant, James E. Robinson, was charged with assault with intent to do great bodily harm less than murder, MCL 750.84; MSA 28.279. At the conclusion of a bench trial held on November 10, 1983, defendant was found guilty of the lesser offense of felonious assault. MCL 750.82; MSA 28.277. On November 30, 1983, defendant was sentenced to three years of probation. Defendant subsequently brought a motion for a new trial on the same grounds now raised on appeal. After a hearing held on August 17, 1983, the trial court denied the motion. Defendant appeals as of right.
The defendant’s first claim is that the trial court’s findings of fact were inadequate to support defendant’s conviction for felonious assault.
The Supreme Court has held that a simple assault can be shown "from either an attempt to commit a battery or an unlawful act which places another in reasonable apprehension of receiving an immediate battery”. People v Sanford, 402 Mich 460, 479; 265 NW2d 1 (1978). No actual battery need be shown. In People v Joeseype Johnson, 407 Mich 196; 284 NW2d 718 (1979), a majority of the Supreme Court held that felonious assault is a specific intent crime. Thus, felonious assault requires the additional showing that the defendant intended to injure or intended "to put the victim in reasonable fear or apprehension of an immediate battery”. Id., 210. The statute also requires the use of a dangerous weapon in carrying out the assault. MCL 750.82; MSA 28.277. See also, CJI 17:4:01.
The trial court specifically resolved the credibility issue in favor of the complainant and accordingly found that the defendant, rather than his wife, the complainant, had possession of the knife. While the court did not specifically find that defendant’s apparent victim, (his wife’s child) Kishra, was in fact placed in reasonable apprehension of receiving an immediate battery, it did find that the complainant "felt that her child was being threatened”. As to the intent element, the trial court specifically found that defendant did not intend to strike the child with the knife (intent to injure), but the court did not expressly resolve whether defendant intended to put the child or mother in reasonable fear of an immediate battery. Defendant argues that the trial court’s findings of fact do not support a conviction for felonious assault because the trial court did not find the requisite intent or an actual assault.
GCR 1963, 517.1, now MCR 2.517(A)(1) and (2), provides that a court in a bench trial must make findings of fact and conclusions of law on contested matters:
"In all actions tried upon the facts without a jury or with an advisory jury, the court shall find the facts specially and state separately its conclusions of law thereon and direct the entry of the appropriate judgment. It will be sufficient if the court makes brief, definite, and pertinent findings and conclusions upon the contested matters without over elaboration of detail or particularization of facts.”
The rule applies equally to criminal and civil cases. People v Jackson, 390 Mich 621, 627; 212 NW2d 918 (1973). However, failure of a judge to make findings of fact "does not require remand where it is manifest that he was aware of the factual issue, that he resolved it and it would not facilitate appellate review to require further explication of the path he followed in reaching the result”. Id., fn 3.
In People v Davis, 126 Mich App 66; 337 NW2d 315 (1983), this Court stated that a trial court must make specific findings of fact on each element of a crime. However, another panel of this Court held that Davis misinterpreted Jackson. People v Taylor, 133 Mich App 762, 766; 350 NW2d 318 (1984), lv gtd 419 Mich 879 (1984). The Taylor, panel interpreted Jackson to mean only that "a trial court’s findings [are] insufficient if they created doubt as to whether the trial court correctly applied the law to the facts”.
As mentioned above, the trial court made no explicit finding that the defendant had intended to place the complainant or her daughter in reasonable fear of an immediate battery. The court found only that the defendant had not intended to strike the child.
It must be borne in mind that the contested issue at trial was who drew the knife, the complainant or defendant. The trial court resolved the issue of credibility in favor of the complainant and her daughter. The court indicated that it believed their version of the events. According to these witnesses, the defendant raised his hand up as if to strike the child. It would be almost absurd for a fact finder to find that the defendant had raised his knife hand as if to strike the child, without also implicitly finding that defendant at least intended to place the child in reasonable fear of a battery.
We believe that a remand is unnecessary under Taylor, supra, and that the court’s findings of fact do support defendant’s conviction for felonious assault.
We also note that it is well settled that no actual battery need be shown to support an assault conviction. Sanford, supra. Further, under the doctrine of transferred intent, the law would transfer defendant’s intent to place the child in fear of a battery to the complainant. See People v Lovett, 90 Mich App 169; 283 NW2d 357 (1979), lv den 407 Mich 884 (1979).
Defendant’s final argument was expressly rejected in People v Poindexter, 138 Mich App 322, 332-333; 361 NW2d 346 (1984). See also, People v Johnson, 70 Mich App 349; 247 NW2d 310 (1976), lv den 399 Mich 818 (1977). The witnesses were properly waived.
Affirmed. | [
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Per Curiam.
Plaintiff filed a complaint against Complete Auto Transit, Inc. (Complete Auto), his employer, National Union Fire Insurance Company (National Union), his employer’s insurer, and Aetna Casualty & Surety Company (Aetna), the insurer of plaintiff’s personal motor vehicle, for damage for injuries sustained in a motor vehicle accident. Aetna filed a cross-claim against Complete Auto and National Union. Plaintiff settled with defendants and an order was entered dismissing the action between plaintiff and defendants. The remaining parties then filed cross motions for summary judgment on Aetna’s cross-claim. After hearing, the trial judge granted the motion in favor of Aetna. Complete Auto and National Union now appeal. We affirm.
Plaintiff was employed by Complete Auto as a "rail loader”. On December 27, 1978, he was a passenger in the back of a pickup truck, called a "yard taxi”, owned by Complete Auto, and driven by another employee, when the truck collided with another company-owned vehicle in Complete Auto’s David Street "yard”. The truck was not registered.
Appellants contend the vehicle was statutorily exempt from registration. Appellants maintain that no-fault insurance coverage on the truck was not required since it fell within a registration exemption under MCL 257.216(b); MSA 9.1916(b). This statute provides in pertinent part:
"Every motor vehicle, trailer coach, trailer, semitrailer, and pole trailer, when driven or moved upon a highway shall be subject to the registration and certificate of title provisions of this act except:
"(b) A vehicle which is driven or moved upon a highway only for the purpose of crossing that highway from 1 property to another.”_
Appellants allege that the truck was used exclusively on Complete Auto’s private property and was operated on public highways only to go from one Complete Auto property to another. After reviewing deposition testimony and affidavits, the trial court concluded that the "yard taxi” was used for "more than just a crossing of the highway”. We agree.
David C. Ax, director of safety at Complete Auto, testified that in 1978 Complete Auto had a David Street facility (where the accident took place) and another facility at Maple Road. They were approximately three miles apart. He testified that the pickup truck involved in the accident would be driven on a public highway only to get from one of Complete Auto’s properties to another and that the truck could have been used in 1978 to travel between these various properties in the course of Complete Auto’s business. Gordon Garrett, employed in the yard by Complete Auto for nine years, testified that he had driven the vehicle in question between the two lots. He had also observed this truck leave the yard to go to another lot leased to Complete Auto, and to Bishop Airport in order to aid another vehicle which ran out of gas. Garrett testified that Complete Auto had a practice of sending unlicensed automobiles out on the roads with transport or temporary plates. George Kalis, supervisor of the rail loading operation, testified that transport plates were kept in the garage. Grant Lightfoote, an employee for 26 years, testified that he had seen the "yard taxis” driven from one facility to the other. In our opinion, the plain meaning of the exemption statute cannot be stretched to accommodate a situation such as this one where "yard taxis” are used to traverse approximately 3-1/2 miles of highway in order to get from one property to another.
We find that since Complete Auto clearly used its "yard taxis” to traverse highways in order to get to its other properties, instead of merely crossing the street, it was required to register such vehicles under MCL 257.216. Therefore, MCL 500.3101(1); MSA 24.13101(1) of the no-fault act required Complete Auto to maintain security for payment of benefits under personal protection insurance.
Complete Auto cannot escape application of the registration requirements or the liability provisions of the no-fault laws merely because this accident happened to occur on private property. MCL 500.3101 does not provide that no-fault insurance be carried for motor vehicles required to be registered only when they are "caught” operating illegally on a public highway. Rather, the statute requires insurance if registration is required. The fact that the accident occurred on private property is irrelevant.
National Union insured Complete Auto’s fleet of vehicles, but only those vehicles which were required to have no-fault coverage. The policy provided that the insurance afforded
"shall comply with the provisions of any 'no-fault’ law which has been or will be inacted [sic] to the extent of the coverage and limits of liability required by such law.”
This provision indicates that National Union is the insurer of the "yard taxi” because it was required to be registered and, therefore, required to carry no-fault insurance.
Affirmed. Costs to Appellee.
MCL 500.3101(1); MSA 24.13101(1) provides:
"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. Security shall be in effect continuously during the period of registration of the motor vehicle.”
Although not indicated, it appears the motion was brought under GCR 1963, 117.2(3). In ruling on the motion, the court properly considered the affidavits, pleadings, depositions and other documentary evidence submitted by the parties. Partrich v Muscat, 84 Mich App 724, 730; 270 NW2d 506 (1978). | [
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Per Curiam.
Plaintiff, SNB Bank and Trust, appeals as of right and garnishee-defendant G & R Felpausch Company and intervenor, Battle Creek Venture, cross-appeal as of right from an order of partial summary judgment in favor of Battle Creek Venture. The judgment was certified as a final order pursuant to GCR 1963, 518.2.
This litigation started when plaintiff filed a complaint against defendant, Kenneth R. Kensey, for collection of a promissory note of $29,364.16, including interest. Defendant defaulted and plaintiff entered a default judgment against him. Plaintiff then pursued garnishment against defendants Felpausch and Muir Company, alleged debtors (lessees) of defendant, by filing writs of garnishment.
Felpausch timely filed a garnishee disclosure claiming that it owed nothing to defendant. In subsequent discovery, Felpausch stated that nothing was owed to defendant under its lease with defendant because defendant’s interest as landlord was assigned to Battle Creek Venture, and that, pursuant to a rental collection agreement, payments were made to Gary National Bank in Indiana.
Muir failed to file a disclosure and a default judgment was taken against it for $31,244.03. Six days after the default judgment was entered against it, Muir filed a motion to set aside the default judgment. That motion was accompanied by an affidavit of John Muir, Muir’s Vice-President. The affidavit gave a reason for Muir’s failure to respond to the writ of garnishment and also alleged that to the best of its knowledge, Muir owed no money to defendant' Kensey. The trial court granted the motion to set aside the default judgment. Muir then filed a disclosure stating that it owed no money to defendant. Muir stated that its sole relationship with Kensey was as a tenant under a lease and that defendant’s interest in the lease had been assigned to Battle Creek Venture.
Prior to entry of the order setting aside the default judgment against Muir, Battle Creek Venture had filed a motion to intervene, which was opposed by plaintiff. The trial court granted the motion to intervene at the same hearing at which it decided that the Muir default judgment should be set aside.
Plaintiff then filed a motion for summary judgment under GCR 1963, 117.2(3) and Battle Creek Venture filed a motion for summary judgment in its favor pursuant to GCR 1963, 117.2(1). In a written opinion, the trial court granted summary judgment in favor of Battle Creek Venture and held that that finding rendered plaintiffs motion for summary judgment moot. An order of judgment was entered on March 14, 1984, and certified as a final judgment pursuant to GCR 1963, 518.2. This appeal and these cross-appeals followed.
Before turning to the issues raised by the parties, we will first address a question not addressed by the parties going to whether plaintiff may properly raise in this appeal issues surrounding the trial court’s grant of the order setting aside the default as to Muir and its grant of the motion to intervene by Battle Creek Venture.
Plaintiffs appeal as of right is from the grant of partial summary judgment for Battle Creek Venture which was certified as final pursuant to GCR 1963, 518.2, and, therefore, should normally be limited to only those issues which may be raised under the specific order which has been certified, the partial summary judgment order, and not the previous orders setting aside default judgment and allowing intervention. These are interlocutory orders not appealable as of right until a final order disposing of the entire case is entered. The partial summary judgment order did, however, have the effect of disposing of all the issues of all parties to the garnishment action.
Under these circumstances and in the interest of judicial economy, we will treat the claim of appeal here as an application for leave to appeal and grant same. We will therefore reach the merits of all of plaintiffs claims. Guzowski v Detroit Racing Ass’n, Inc, 130 Mich App 322, 326; 343 NW2d 536 (1983).
Plaintiff first claims that the trial court abused its discretion in setting aside the default judgment against Muir. The decision to set aside a default judgment is within the trial court’s sound discretion and will not be reversed unless a clear abuse of that discretion is shown. Yenglin v Mazur, 121 Mich App 218, 221; 328 NW2d 624 (1982). A default judgment may not be set aside, however, unless there is a showing of good cause and unless an affidavit of facts showing a meritorious defense is filed. GCR 1963, 520.4 (now MCR 2.603[D]). In this case, plaintiff entered a default judgment against Muir nine days after Muir’s response was due, and Muir moved almost immediately to set aside the default judgment. Although the "administrative oversight” cited by Muir might well be classified as mere negligence and not good cause, good cause is also shown when permitting the judgment to stand would result in manifest injustice. Daugherty v Michigan (After Remand), 133 Mich App 593, 598; 350 NW2d 291 (1984).
Muir raised as a defense that it owed defendant no money and thus had no money to turn over to plaintiff in the garnishment action. If this was true, then, clearly, justice would not be served by demanding that Muir pay a judgment since it had nothing to do with defendant’s original default or failure to pay the note nor has any monies owing defendant against which it can set off the judgment.
The trial court did not abuse its discretion in finding that Muir had shown good cause to set aside the default.
Plaintiff also argues that Muir’s affidavit setting forth a meritorious defense was inadequate as it was merely conclusory without bearing specific facts. We disagree. The affidavit stated that Muir reviewed its accounts payable and its business records and found no record of any monies being due and owing defendant. The affidavit also indicated that Muir’s rent liability is to a party other than defendant, namely Battle Creek Venture. This is a sufficient allegation of facts to establish a meritorious defense. Although it is certainly true that in the actual litigation additional facts would have to be brought forth concerning its liabilities, if any, to defendant, those facts would naturally be developed during the course of discovery and at trial, rather than in the initial affidavit.
We find no abuse of discretion in the setting aside of the default judgment.
Plaintiff next argues that the trial court erred in granting Battle Creek Venture’s motion to intervene. We disagree.
GCR 1963, 738.9(2) (now MCR 3.101[J]) provides that if a person other than the plaintiff and the principle defendant claims any of the funds in issue, the court may order that third-party claimant impleaded. It was therefore appropriate for the trial court to order Battle Creek Venture impleaded, even in the absence of a motion to intervene by Battle Creek Venture. At the very worst, therefore, the trial court may have reached the correct result for the wrong reason or under an incorrect court rule citation.
Plaintiff also argues that even if intervention was allowable under GCR 1963, 209, Battle Creek Venture failed to comply with the requirement of GCR 1963, 209.3 that its motion for intervention be accompanied by a pleading setting forth the claim or defense for which intervention is sought. The only document filed by Battle Creek Venture with its motion for intervention was an affidavit in support of that motion. However, that affidavit does set forth Battle Creek Venture’s claim or defense, namely that it, and not defendant, is entitled to the rents which plaintiff is seeking to garnish.
Although Battle Creek Venture’s affidavit certainly was not a "pleading” within the meaning of GCR 1963, 110 (MCR 2.110), it did serve to put plaintiff on notice as to Battle Creek Venture’s theory as to why plaintiff should not prevail on the garnishments. The court rules are to be construed so that defects in the proceedings do not affect the substantial rights of the parties, GCR 1963, 13 (MCR 1.105). Justice would not be served in this cause by determining that intervention is not proper because a document was entitled an affidavit rather than an answer. Furthermore, as pointed out in the briefs of Battle Creek Venture and Felpausch, the court rule governing garnishments rather broadly defines pleadings to include such items as affidavits and interrogatories. GCR 1963, 738.11(1) (MCR 3.101[M][2]). We conclude that substantial justice was served by allowing Battle Creek Venture to intervene and that an overly technical reading of the pleading requirements would not serve justice, nor is it required in order to preserve the rights of plaintiff.
Plaintiff also argues that Battle Creek Venture’s motion to intervene was untimely. Again, we disagree. Felpausch filed its garnishee disclosure on May 31, 1983. Following discovery, the trial court entered an order on April 27, 1983, ordering Felpausch to pay the county clerk all future rental payments until the principal judgment was satisfied. Battle Creek Venture filed its motion to intervene on May 18, 1983. There is no evidence in the record below to suggest that Battle Creek Venture was aware of the April 27 order directing that rents go elsewhere. Once that order had been entered, Battle Creek Venture moved to intervene three weeks later.
The fact that orders had been entered as to future rentals from Felpausch and a default judgment as to Muir prior to the motion to intervene is not dispositive. It would be unjust to deny Battle Creek Venture the opportunity to intervene in this action, the result of which could adversely affect its interests. Eastern Construction Co v Cole, 52 Mich App 346, 350; 217 NW2d 108 (1974).
Plaintiff next argues that the trial court erred in setting aside its order of April 27, 1983, which ordered that Felpausch make all future rental payments to the county clerk. We disagee.
A judgment or final order in a garnishment action may be set aside in the same manner as in any other civil action. GCR 1963, 738.13(6) (MCR 3.101[O]). The reasons for granting relief from a judgment are set forth in GCR 1963, 528.3:
”.3 Mistakes; Inadvertence, Excusable Neglect; Newly-Discovered Evidence; Fraud; Etc. On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under subrule 527.2; (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than 1 year after the judgment order or proceeding was entered or taken. A motion under subrule 528.3 does not affect the finality of a judgment or suspend its operation. This rule does not limit the power of a court to entertain an independent action to relieve a party from a judgment, order, or proceeding, or to grant relief to a defendant not actually personally notified as provided in subrule 528.2 above, or to set aside a judgment for fraud upon the court.” (See MCR 2.612 for current provisions).
The decision to vacate a judgment is addressed to the discretion of the trial court and will not be reversed unless there is a clear abuse of that discretion. Crew v Zabowsky, 357 Mich 606, 609; 99 NW2d 542 (1959).
As we have concluded in connection with the setting aside of the default against Muir, we also conclude that there was no abuse of discretion in setting aside the April 27, 1983, order. If, in fact, the rents in question belong to Battle Creek Venture rather than defendant Kensey, the trial court’s action is certainly justified under GCR 1963, 738.13(6). Justice would not be served by extracting a judgment from one not connected with the grievance. McDonough v General Motors Corp, 6 Mich App 239, 246-247; 148 NW2d 911 (1967).
Plaintiff next argues that Battle Creek Venture, as an intervening party, had no standing to raise the claim that rental payments to defendant and his wife were entireties property and therefore exempt from garnishment by plaintiff, a creditor of the defendant husband only. Plaintiff did not, however, raise this issue in the trial court and therefore has not preserved the question for our consideration on appeal.
Finally, plaintiff argues that the trial court erred in holding that property owned by the entireties may not be garnished by a single spouse’s creditors. Again, we must disagree.
Contrary to plaintiff’s assertion, there is no dis pute that the rental properties involved were held by defendant, Dr. Kenneth R. Kensey, and his wife, Dr. Rosemary Kensey, by the entireties. A question as to the existence of an estate by the entireties raises a presumption that when a property is held by both a husband and wife it was intended to create a tenancy by the entirety. Butler v Butler, 122 Mich App 361, 366; 332 NW2d 488 (1983). The record contains nothing to rebut this presumption and there was therefore no dispute as to this issue.
In Michigan, rents from property held by the entireties are not subject to garnishment to pay the debts of the husband. Peoples State Bank of Pontiac v Reckling, 252 Mich 383; 233 NW 353 (1930); Battjes Fuel & Building Material Co v Milanowski, 236 Mich 622; 211 NW 27 (1926). Plaintiff cites no case overruling these decisions nor are we aware of any such decision.
Plaintiff cites MCL 557.71; MSA 26.210(1), adopted in 1975, for the proposition that the Legislature has overruled the common-law provision that rents from properties by the entireties are not subject to garnishment by one spouse’s creditor. That statute provides:
"A husband and wife shall be equally entitled to the rents, products, income, or profits, and to the control and management of real or personal property held by them as tenants by the entirety.”
Again, however, plaintiff cites no cases which have construed the statute in such a way and we decline to do so. The effect of the statute is merely to modify the common-law rule that a husband had absolute control over property held by the entireties and the rent derived therefrom. To the extent that the material appended to plaintiff’s brief constitutes legislative history, that legislative history does not support plaintiff’s interpretation. Rather, it indicates that the intent of the statute was to equalize the right of control between husband and wife and to offset some adverse tax implications. We cannot read into the statute an intent to extinguish the estate by the entireties or to make an estate by the entireties or its rents subject to garnishment by the creditors of one spouse.
If, as argued by plaintiff, the estate by entireties has indeed outlived its usefulness and should be abolished, it is up to either the Legislature or the Supreme Court to make that determination. The last statements on this issue by the Legislature and by the Supreme Court have recognized the existence of an estate by the entireties. This Court is bound by those determinations.
After considering all the issues raised by the plaintiff, we conclude that the trial court acted properly in granting summary judgment in favor of Battle Creek Venture and, thus, in favor of the garnishee-defendants and against plaintiff, and that the decision of the trial court should be affirmed.
Our disposition of this matter makes consideration of the issue raised in the cross-appeals unnecessary.
Affirmed.
Were we to consider this issue on the merits, we would conclude that Battle Creek Venture definitely had standing to raise the theory of defense under the rationale of Board of Library Comm’rs of the Saginaw Public Libraries v Judges of the 70th District Court, 118 Mich App 379, 385; 325 NW2d 777 (1982):
"The requirement that a party bringing a suit have standing is used to insure that only those who have a substantial interest in a dispute will be allowed to come into court to complain. St John’s — St Luke Evangelical Church, United Church of Christ v National Bank of Detroit, 92 Mich App 1; 283 NW2d 852 (1979). The standing doctrine recognizes that litigation should be conducted only by a party having 'an interest that will assure sincere and vigorous advocacy’. Michigan License Beverage Ass’n v Behnan Hall, Inc, 82 Mich App 319, 324; 266 NW2d 808 (1978). Therefore, the threshold question is whether plaintiff has an interest in the outcome of this litigation sufficient to invoke the controversy resolving powers of the judiciary.”
Battle Creek Venture has such an interest in this litigation. That its advocacy in this case is sincere and vigorous is indicated by the trial court’s decision to accept its theory.
Attached as appendices to plaintiffs brief were the recommendations of the Michigan Law Revision Commission relating to 1975 House Bill No. 4971, which was enacted as 1975 PA 288, and also the first analysis of the bill by the Analysis Section of the House of Representatives Judiciary Committee. | [
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] |
R. L. Evans, Jr.
In this action, plaintiff, trustee of the Brookfield Royalty Pool, sought to obtain an order compelling defendants to pay him half of all royalties they received as the result of oil production on certain property, in accordance with the terms of a royalty pooling deed executed by defendants on April 27, 1971. By a counterclaim and a third-party complaint, defendants sought to have the royalty pooling deed rescinded and to obtain other relief. After a nonjury trial, the trial court found for plaintiff, and an order was entered granting the relief plaintiff requested on the condition that plaintiff produce within 90 days of the entry of judgment opinions and certificates of a title examiner showing that, as of May 15, 1971, the royalty pool had good and merchantable title pursuant to royalty pooling deeds to not less than 1,000 mineral acres in Brookfield Township and certain sections of Eaton Township in Eaton County. Defendants appeal as of right.
I
Defendants argue that the trial court erred by declining to grant their motion to dismiss plaintiffs complaint at the close of plaintiffs proofs. Defendants point to the following provision of the royalty pooling deed:
"Unless royalty pooling agreements similar to this agreement have been executed and delivered to the Trustee on or before the__of_May__1971 covering a total of not less than __ acres, within the limits of the lands described in Schedule 'A’, the Grantors shall be entitled to the return of this pooling agreement unless the date last above set forth shall have been extended in writing signed by Grantors hereto.”
Defendants argue that this provision of the deed required acquisition by the trustee of "good and merchantable” title to the amount of property specified in the provision and that plaintiff failed to show in his case in chief that the deeds that he obtained amounted to "good and merchantable” title. Resolution of this motion to dismiss was controlled by GCR 1963, 504.2, and the trial court’s determination not to grant defendant’s motion will not be overturned on appeal unless clearly erroneous. See, for example, Warren v June’s Mobile Home Village & Sales, Inc., 66 Mich App 386, 389; 239 NW2d 380 (1976).
As the previously quoted provision of the deed shows, the deed contains no express requirement of "good and merchantable” title. Moreover, after a pretrial conference, a pretrial summary was entered and served on the parties’ attorneys pursuant to GCR 1963, 301.3. That subrule provided in part:
"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 pretrial summary stated the issues to be litigated at trial; none related to the sufficiency of the trustee’s title. Defendants made no attempt to have the pretrial summary modified, and first raised this issue in their motion to dismiss. When plaintiffs attorney expressed surprise, the trial court did not hold that defendants had waived this issue, as GCR 1963, 301.3 authorized him to hold, but instead established a mechanism for plaintiff to show "good and merchantable” title in post-judgment proceedings. On this record, we cannot say that the trial court’s resolution of defendants’ motion to dismiss was clearly erroneous or presents manifest injustice.
Defendants attack the sufficiency of plaintiffs post-judgment showing of "good and merchantable” title. We decline to address this issue, because defendants failed to raise it in the trial court at a time when the trial court had jurisdiction to resolve it. After defendants filed a claim of appeal, jurisdiction over this case vested in this Court pursuant to GCR 1963, 802.1. The trial court had no jurisdiction to conduct proceedings in the case. People v George, 399 Mich 638; 250 NW2d 491 (1977). Defendants only raised this issue in the trial court when the case was on remand to the trial court for the limited purpose of determining whether execution of the judgment should be stayed. The trial court properly declined to address the issue at that time, on the ground that the issue was outside of the scope of the jurisdiction conferred by the order remanding the case. Under these circumstances, we have nothing relating to this issue to review.
II
Findings of fact by a trial judge sitting without jury cannot be set aside on appeal unless clearly erroneous. See MCR 2.613(C) (formerly GCR 1963, 517.1). Defendants ask us to set aside the trial judge’s finding that their execution of the royalty pooling deed was not induced by fraud. In Hi-Way Motor Co v International Harvester Co, 398 Mich 330, 336; 247 NW2d 813 (1976), the Court, quoting Candler v Heigho, 208 Mich 115, 121; 175 NW 141 (1919), explained:
"The general rule is that to constitute actionable fraud it must appear: (1) That defendant made a material representation; (2) that it was false; (3) that when he made it he knew that it was false, or made it recklessly, without any knowlege of its truth and as a positive assertion; (4) that he made it with the intention that it should be acted upon by plaintiff; (5) that plaintiff acted in reliance upon it; and (6) that he thereby suffered injury. Each of these facts must be proved with a reasonable degree of certainly, and all of them must be found to exist; the absence of any one of them is fatal to a recovery.”
Generally, a failure to read a written contract document does not require rescission of the contract unless other facts indicate fraud, artifice, or deception. See, for example, Vandendries v General Motors Corp, 130 Mich App 195, 200; 343 NW2d 4 (1983). Failure to read a contract document provides a ground for rescission only where the failure was not induced by carelessness alone, but instead was induced by some stratagem, trick, or artifice by the parties seeking to enforce the contract. Otto Baedeker & Associates, Inc v Hamtramck State Bank, 257 Mich 435, 441; 241 NW 249 (1932). Here, defendants rely on alleged state ments by a promoter of the pool, C. B. Acker, to show fraud. Some of these alleged statements are inconsistent with the language of the royalty pooling deed. A clause of the deed states that it expresses the entire agreement between the parties and that no person has any authority to make written or oral modifications or representations concerning the subject matter of the deed. Defendant Roger Sederlund admitted that he executed the deed without reading it completely. Defendants assert fraud, but do not assert that any fraud induced them to execute the deed without reading it completely.
Defendants claim that C. B. Acker falsely told them that there was a good prospect that oil would be discovered in their area of their township. Any such statement by Acker was, however, demonstrably true, since oil was in fact subsequently discovered on defendant’s property.
Defendants also claim that C. B. Acker told them that they would benefit from participating in the pool. Defendants claim that they have not benefited because oil was discovered on their land but not on land of other participants in the pool. However, the testimony of defendant Roger Sederlund at trial showed that defendant understood from Acker’s statements that participation in the pool would mainly be beneficial if oil was discovered on the land of other participants rather than on defendants’ land. The royalty pool was a device to spread among participants the benefits of any discovery of oil or gas and the risk that no oil or gas would be discovered. Its nature was amply disclosed by the deed. Nothing revealed by the testimony could reasonable be construed as a warranty by Acker that oil would be discovered on the land of other participants and not on defendants’ land. No false representation by Acker or reliance by defendants is apparent in connection with this allegation.
Defendants also claim that C. B. Acker falsely told them that they were conveying only 1/16 of their minerals by the royalty pooling deed. Under the terms of the deed, defendants technically transferred an undivided 1/2 interest in any oil and gas produced from their land, but they retained the exclusive right to lease their land for oil and gas purposes. Defendants agreed not to execute an oil or gas mining lease for the land without reserving at least 1/8 of the production as royalty. Because the pool would be entitled to only 1/2 the production reserved as royalty, any statement by Acker that defendants were transferring 1/16 of their oil and gas to the pool was not false.
Defendants also claim that C. B. Acker falsely told them that participation in the pool would be limited only to their immediate neighbors. The testimony of defendant Roger Sederlund shows, however, that Acker correctly told defendants that certain neighbors were participating in the pool, but made no representation that participation was limited to those neighbors. The term "neighbors”, allegedly used by Acker, was broad enough to include residents of defendants’ township and an adjoining township. The geographic extent of the pool and minimum acreage requirements were clearly disclosed in the deed. Moreover Roger Sederlund testified that he did not take the royalty pool seriously and did not care who was a member of the pool until oil was discovered on his land. No false statement by Acker or reliance by defendants is apparent in connection with this allegation.
Defendants also claim that C. B. Acker falsely told them that neither he nor his associates would gain anything from his promotional efforts. In fact,the deed reserved an undivided 1/4 of the interest in the pool for C. B. Acker and D. J. Acker. This reservation, however, was expressly stated in the deed defendants executed. Moreover, defendant Roger Sederlund testified that he had not believed the alleged denial by Acker of any gain from promotional efforts and had not particularly cared what gain, if any, Acker would receive. No reliance by defendants on the alleged false allegation is apparent.
On this record, we cannot say that the trial court’s findings as to fraud were clearly erroneous.
Ill
Defendants attack the adequacy of the consideration for the execution of the royalty pooling deed. Courts will not ordinarily inquire into the adequacy of consideration and rescission of the contract for inadequacy of consideration will not be ordered unless the inadequacy was so gross as to shock the conscience of the court. See, for example, Rose v Lurvey, 40 Mich App 230, 234; 198 NW2d 839 (1972). It is well-settled that a conditional promise may form adequate consideration. See Restatement Contracts, 2d, § 76, p 192, 1 Cor-bin, Contracts, § 148, P 645 and 1 Williston Contracts, § 103, pp 394-395.
The contract here was an exchange of conditional promises. In return for a share of any royalties defendant would receive if oil or gas was found on their land, defendants received the right to share in royalties from any oil or gas discovered on other land included in the pool. At the time these promises were made, no one could know on which lands, if any, oil or gas would be discovered. Defendants now contend that they have contributed more to the pool than they have gained, but matters could easily have turned out differently. Defendants chose to enter into a speculative transaction and cannot now complain about the outcome of their speculation. The consideration here cannot be characterized as grossly inadequate and does not shock our consciences.
IV
Defendants argue that the royalty pooling deed was invalid, because it contained a restraint on alienation. Defendants rely on the following clauses of the deed:
"If oil or gas is not found on some tract in which royalty has been conveyed to the Trustee in the territory covered by Schedule 'A’, within ten years from the date hereof, all rights conveyed hereby shall revert to the Grantors, their heirs or assigns; but, in the event oil or gas is produced on any such tract during the said ten year period, the rights granted hereby shall continue so long as oil or gas is produced on any of the pooled tracts. * * * The Trustee shall have no right to sell or otherwise dispose of any part of the royalty interest conveyed to him but shall simply hold the legal title to the same for the use and benefit of the several Grantors and Third Party as hereinafter provided.”
Michigan’s statutory rule against restraints on alienation, 1948 CL 554.14 et seq., was repealed by 1949 PA 38. See Lantis v Cook, 342 Mich 347, 354; 69 NW2d 849 (1955). Some subsequent decisions imply that Michigan still follows a common-law rule prohibiting unreasonable restraints on alienation. See Pellerito v Weber, 22 Mich App 242, 245; 177 NW2d 236 (1970), Lemon v Nicolai, 33 Mich App 646, 649; 190 NW2d 549 (1971), and Nichols v Ann Arbor Federal Savings & Loan Ass’n, 73 Mich App 163, 168; 250 NW2d 804 (1977).
In Sloman v Cutler, 258 Mich 372, 374-375; 242 NW 735 (1932), the Court explained:
"If one’s interest in property is absolute, as a fee simple, restriction on his right of alienation is void as repugnant to the grant. This is because violation of the restriction affects no interest but his own. Mandlebaum v McDonell, 29 Mich 78 (18 Am Rep 61) [1874]. Where the grantor retains an interest in the property granted, such as reversionary interest to him as lessor, the interest generally will support the imposing of a restriction on alienation.”
The royalty pooling deed did not confer an estate in fee simply on the trustee. Instead, defendants, as grantors, conveyed to the trustee legal title to an undivided 1/2 interest in oil and gas produced from their land, but they retained various interests in the property, including an equitable interest corresponding to the legal interest conveyed to the trustee plus all the other incidents of ownership of the land. Moreover, the estate conveyed to the trustee was limited in time. The restrictions on the trustee’s power to alienate the interest conveyed to him were necessary to effectuate the purpose of the trust and were not unreasonable.
Defendants’ reliance on Carlson v Tioga Holding Co, 72 NW2d 236 (ND, 1955), is misplaced. The finding of the court in that case that the royalty pooling deed contained an illegal restraint on alienation was based on a North Dakota statute which stated a broader rule against restraints on alienation than Michigan courts have followed since the repeal of the applicable Michigan statute.
We note, moreover, that if any unreasonable restraint on alienation were to be found, the remedy would be to declare the restraining clause unen forceable, not to declare the conveyance unenforceable. See Lemon v Nicholai, supra, p 649, and Nichols v Ann Arbor Federal Savings & Loan Ass’n, supra, p 168.
Defendants also argue that the royalty pooling deed violated the rule against perpetuities and was therefore invalid. The common-law rule against perpetuities has been adopted in Michigan by statute. MCL 554.51; MSA 26.49(1). The rule is violated if, at the time the instrument creating a future estate comes into operation, it is not certain that the estate will either vest or fail to vest within 21 years of the death of a person named in the instrument. Michigan Trust Co v Baker, 226 Mich 72, 77-78; 196 NW 976 (1924); Gardner v City National Bank & Trust Co, 267 Mich 270, 284; 255 NW 587 (1934). The rule is not violated, however, by a conveyance reserving the possibility of a reverter in the grantor, because such a possibility is vested. See Simes & Smith, Law of Future Interests (2d ed), § 1239, pp 146-147. A vested possibility of reverter arises when the holder of a vested estate conveys a vested lesser estate to another. Simes & Smith, § 82, pp 65-66. Defendants here therefore retain vested possibilities of reverter ten years from the date of execution of the deed, if no oil or gas was produced on the land within the ten-year period, or when production ceased, if production occurred within the ten-year period. No violation of the rule against perpetuities was presented. See Froelich v United Royalty Co, 178 Kan 503; 290 P2d 93 (1955),on reh 179 Kan 652; 297 P2d 1106 (1956), and McGinnis v McGinnis, 391 P2d 927, 930-931 (Wyo, 1964).
V
Defendants argue that the royalty pooling deed was a security subject to the requirements of the Uniform Securities Act, MCL 451,501 et seq.; MSA 19.776(101) et seq., and that the deed should be set aside and penalties authorized by the act should be imposed because the security was not registered as required by MCL 451.701; MSA 19.776(301). Because the deed was executed on April 27, 1971, our analysis of this issue will be based on the Uniform Securities Act as it existed in 1971, although the act has been extensively amended since then by 1975 PA 31 and 1978 PA 481.
MCL 451.01(1); MSA 19.776(401X0 provided;
" 'Security’ means any note; stock; treasury stock; bond; debenture; evidence of indebtedness; certificate of interest or participation in any profit-sharing agreement; collateral-trust certificate; preorganization certificate or subscription; transferable share; investment contract; voting-trust certificate; certificate of deposit for a security; certificate of interest or participation in an oil, gas or mining titles or lease or in payments out of production under such a title or lease; or, in general, any interest or instrument commonly known as a 'security’, or any certificate of interest or particpation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing. 'Security’ does not include any insurance or endowment policy or annuity contract under which an insurance company promises to pay money either in a lump sum or periodically for life or some other specified period.” (Emphases added.)
To determine whether a particular transaction is subject to the Uniform Securities Act, a court must look to the substance of the transaction and the real intent and purpose of the parties. People v Blankenship, 305 Mich 79, 86; 8 NW2d 919 (1943); People v Breckenridge, 81 Mich App 6, 14; 263 NW2d 922 (1978); Prince v Heritage Oil Co. 109 Mich App 189, 197; 311 NW2d 741 (1981). By the royalty pooling deed, defendants conveyed an undivided 1/2 interest in all oil and gas produced from their land to the trustee on behalf of the pool and agreed not to execute an oil or gas mining lease for the land without reserving at least 1/8 of the production as royalty. In return, defendants receive the right to share in royalties from the other interests conveyed to the pool. The royalty pooling deed was therefore a "certificate of interest or participation* * *in payments out of production under [an oil, gas, or mining] title or lease”, and therefore a "security” as that term was defined in the act. Compare People v Blankenship, supra, and Prince v Heritage Oil Co, supra. See also Wigington v Mid-Continental Royalty Co, 130 Kan 785; 288 P 749 (1930), Moos v Landowners Oil Ass’n, 136 Kan 424; 15 P2d 1073 (1932), Ward v Home Royalty Ass’n Inc, 142 Kan 546; 50 P2d 992 (1935), Marney v Home Royalty Ass’n of Oklahoma, 34 NM 632; 286 P 979 (1930), and Smith v Fishback, 123 SW2d 771 (Tex Civ App, 1938).
Plaintiff relies on Hathaway v Porter Royalty Pool, Inc, 296 Mich 90; 295 NW 571 (1941), in which the Court determined that certificates issued to participants in a royalty pool analogous to that at issue here were not subject to the requirements of the blue sky law, 1929 CL 9769 et seq., even though the pool had been nominally organized as a corporation. The Hathaway decision was based in part upon a narrower definition of "security” than that applicable here, 296 Mich 108-110, and in part upon cases holding that certificates of participation in a joint venture were not subject to the blue sky law, 296 Mich 109. See Lindemulder v Shoup, 258 Mich 679; 242 NW 807 (1932), Wardowski v Guardian Trust Co of Detroit, 262 Mich 422; 247 NW 908 (1933), and Polk v Chandler, 276 Mich 527; 268 NW 732 (1936). These cases distinguish between an initial issuance of certificates to participants in the organization of a joint venture and the subsequent resale of such certificates, holding that the latter but not the former was subject to the blue sky law. See Wardowski v Guardian Trust Co, supra, P 430, and Polk v Chandler, suprs, P 532.
By the time of Polk v Chandler, the blue sky law had been amended to expressly exclude certificates of participation in some joint ventures. 276 Mich 533. The blue sky law, however, was repealed by 1964 PA 265, which enacted the Uniform Securities Act. The Uniform Securities Act contained no exceptions for certificates of participation in joint ventures. Written agreements creating joint ventures were found to be "securities” in Prince v Heritage Oil Co, supra. In 1971, MCL 451.802(b)(10); MSA 19.776(402)(b)(10) exempted a transaction from the requirement of the Uniform Securities Act in the following circumstances:
"Any offer or sale of a preorganization certificate or subscription, and the issuance of securities pursuant thereto, if:
"(A) No commission or other remuneration is paid or given directly or indirectly for soliciting any prospective subscriber;
"(B) The number of subscribers does not exceed 10; and
"(C) Each of the subscribers signs the articles of incorporation in person and not by agent and is purchasing for investment.”
This transaction did not fall within this exception. An established principle of statutory construction is that the express mention in a statute of one thing implies the exclusion of other similar things (expressio unius est exclusio alterius). See, for example, Stowers v Wolodzko, 386 Mich 119, 133; 191 NW2d 355 (1971). By creating the forego ing narrow exception for certain initial organizational sales, the Legislature implicitly rejected a broad exception for all initial issuances of certificates of participation in a joint venture.
Plaintiff advances two related arguments. Plaintiff argues that the transaction was exempt as an isolated transaction, and that the Sederlunds, not plaintiff, issued the security and so were responsible for any violation of the act. In 1971, MCL 451.802(b)(1); MSA 19.776(402)(b)(l) exempted the following transactions from the requirements of the act:
"Any isolated nonissuer transaction, whether effected through a broker-dealer or not.”
The definition of "issuer” in MCL 451.801(g); MSA 19.776(401)(g) contained the following qualification:
"(2) With respect to certificates of interest or particpation in oil, gas or mining titles or leases or in payments out of production under such titles or leases, there is not considered to be any 'issuer’.”
Plaintiff relies on language specifically dealing with oil, gas, and mining securities which, however, had not yet been added to the act in 1971, MCL 451.802(d); MSA 19.776(402)(d) provided in 1971:
"In proceeding under this act, the burden of proving an exemption or an exception from a definintion is upon the person claiming it.”
Execution of the royalty pooling deed here was necessarily a nonissuer transaction, because there was by definition no "issuer”. The royalty pooling deed was essentially two securities in one: it certi fied both the pool’s interest in payments out of oil and gas production on defendant Sederlunds’ land and defendant Sederlunds’ interest in payments out of oil and gas production to the pool from other land subject to the pool. Execution of the deed was an isolated transaction from the Sederlunds’ point of view; the evidence showed only one such transaction by the Sederlunds. The evidence, however, showed about 27 such transactions by plaintiff and its agents to establish the pool. We cannot see how plaintiff can rely on the exception for isolated nonissuer transactions.
Plaintiff has stipulated that the royalty pooling deed was unregistered. Sale of this security therefore was unlawful. MCL 451.701; MSA 19.776(301). A "sale” of the security, as that term was defined in MCL 451.801(j); MSA 19.776(401)0'), occurred when the royalty pooling deed was executed.
The private remedies for violations of the act were specified in MCL 451.810; MSA 19.776(410), which provided in part:
"(a) Any person who:
"(1) Offers or sells a security in violation of section 201(a), 301 or 405(b), or of any rule or order under section 403 which requires the affirmative approval of sales literature before it is used, or of any condition imposed under section 304(d), 305(f) or 305(g), or
"(2) Offers or sells a security by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading, the buyer not knowing of the untruth or omission, and who does not sustain the burden of proof that he did not know, and in thé exercise of reasonable care could not have known, of the untruth or omission.
"Is liable to the person buying the security from him, who may sue either at law or in equity to recover the consideration paid for the security, together with inter est at 6% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the security, upon the tender of the security, or for damages if he no longer owns the security. Damages are the amount that would be recoverable upon a tender less the value of the security when the buyer disposed of it and interest at 6% per year from the date of disposition.
"(e) No person may sue under this section more than 2 years after the contract of sale. No person may sue under this section (1) if the buyer received a written offer, before suit and at a time when he owned the security, to refund the consideration paid together with interest at 6% per year from the date of payment, less the amount of any income received on the security, and he failed to accept the offer within 30 days of its receipt, or (2) if the buyer received such an offer before suit and at a time when he did not own the security, unless he rejected the offer in writing within 30 days of its receipt.
"(f) No person who has made or engaged in the performance of any contract in violation of any provision of this act or any rule or order hereunder, or who has acquired any purported right under any such contract with knowledge of the facts by reason of which its making or performance was in violation, may base any suit on the contract.”
Subsection (e) bars any action by defendants under subsection (a), because more than two years have expired since execution of the royalty pooling deed in 1971. Defendants argue that the two-year period was tolled pursuant to MCL 600.5855; MSA 27A.5855, which provides that if a person who is or may be liable for any claim fraudulently conceals the existence of the claim or the identity of any person who is liable for the claim, the action may be commenced any time within two years after the person who is entitled to bring the action discovers or should have discovered the fraudulently concealed matters. To support this claim of fraudulent concealment, however, defendants rely only on claims of fraud which the trial court and we rejected in other contexts. The record here will not support a conclusion that the limitation period was tolled by MCL 600.5855; MSA 27A.5855.
Subsection (f), however, bars any action by plaintiff to enforce the royalty pooling deed. The trial court did not err by denying defendants any relief on their counterclaim and third party complaint, but it erred by enforcing the deed against defendants.
Affirmed in part and reversed in part. | [
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Butzel, J.
Fred E. and Anna Shreve entered into an executory contract for the purchase of property in Kalamazoo, used and occupied as a boarding house. The contract called for a total purchase price of $25,000, a down payment of $3,000, and monthly payments of $150, with interest at 7 per cent. Jerrie A. Richardson purchased the vendor’s interest in this contract. In the course of the following year, the vendees fell approximately four months in arrears, and Richardson insisted that they either pay up or sell out and make a settlement.
The vendees thereupon enlisted the services of Samuel Hoekstra, a real estate dealer, who interested'Ralph W. and Yerna L. Sweet in the property by misrepresenting its value and earning power. Hoekstra told them that the property had been purchased for $32,000, and that a down payment of $10,000 had been made. Richardson, the vendor’s assignor, helped to carry out the deception by signing a new contract in which $7,000 was added to both the purchase price and down payment. The Shreves thereupon traded their equity, represented as $10,000, for property belonging to the Sweets and consisting of a 40-acre farm, its stock and equipment, in Allegan county, an 80-acre farm in Barry county, and a cottage and two lots on West Lake in Kalamazoo county, subject to incumbrances on each parcel aggregating $2,700. The new contract ran directly-from Richardson to the Sweets. Except for the padding of the purchase price and down payment and the insertion of a clause, at the request of Richardson, permitting him to place a mortgage on the property, the new contract did not differ substantially from the former one which had been surrendered by the Shreves. The new contract was signed by the Sweets before Richardson saw it. He had no direct contact with them until some time later. The testimony bears out his claim that he was not guilty of any wrongful conduct except the constructive fraud which resulted from his signing the contract with padded amounts of purchase price and down payment. There is testimony that Richardson desired that a new contract be drawn, and he consented to a padding of the stated amounts. The record shows that, some time later, he expressed himself to the Sweets in no uncertain language about his foolishness in having signed the padded contract. He was guilty of a constructive fraud. As a rule, when a vendor signs a new contract, substituted for an earlier agreement and differing materially in its terms through increasing the price and down payment, though the balance due and unpaid remains the same, and the new contract is used as a device to defraud an innocent third party, the vendor is guilty of a constructive fraud, regardless of the innocence of his intentions. See Hall-Doyle Equity Co. v. Crook, 245 Mich. 24; Holbrook v. Blick, 256 Mich. 396.
The testimony is somewhat conflicting as to when the Sweets first discovered the fraud that was perpetrated upon them. There is but little doubt that the Sweets were deceived, that they, paid for the property an amount far in excess of its real value, and that the contract, as exhibited to them, was largely instrumental in perpetration of the fraud. Richardson alone appeals from the judgment rendered against him and Hoekstra, the agent. In addition to other defenses, he claims that the action was outlawed because over three years elapsed since the fraud occurred. He contends that the action is one based on injury to property and must be brought within the three-year period prescribed by subsec tion 2 of 3 Comp. Laws 1929, § 13976. There is testimony to show that the fraud was not discovered until within a year and a half prior to the bringing of the suit.
Furthermore, we do not believe that the present action constitutes one for injuries to person or property. It is a suit brought for the recovery of damages caused plaintiffs as a result of fraudulent representations made by defendants. Previous Michigan decisions have assumed that actions for fraud are covered by the general six-year limitation in section 13976. See Holman v. Moore, 259 Mich. 63, 68; Ramsey v. Child, Hulswit & Co., 198 Mich. 658, 667; Armstrong v. Rachow, 205 Mich. 168, 179. While there are some authorities in other jurisdictions to the contrary, and it may be claimed that the precise point here involved was not carefully considered in the cases cited, we believe the correct rule to be that, where the damages claimed are not for injuries to specific property, subsection 2 of 3 Comp. Laws 1929, § 13976, does not apply, but the action may be brought within the general six-year provisions in 3 Comp. Laws 1929, § 13976.
Objections made to the court’s refusal to accept certain of defendants ’ requests to charge were without merit. Plaintiffs recovered a judgment for $7,300, which is affirmed, with costs to plaintiffs.
McDonald, C. J., and Clark, Potter, North, Fead, and Wrest, JJ., concurred. Sharpe, J., did not sit. | [
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Fead, J.
For some years, and many times, defendant had borrowed money from plaintiff and paid him two per cent, interest per month. In 1928 they settled accounts and determined that defendant owed plaintiff $1,500. Plaintiff loaned him an other $1,000 and took his demand note for $2,500 and a warranty deed of certain premises as security. The deed was not recorded, whether at plaintiff’s suggestion or not is in dispute. Some eight months later defendant sold the premises to a Iona fide purchaser for value and without notice of plaintiff’s deed (mortgage).
Plaintiff brought suit against defendant and had judgment for $2,812.50 on April 14, 1932. Besides-the common counts, the declaration contained a special count setting up the facts of the loan, security, and sale, and charged wilful and malicious destruction of plaintiff’s security. Defendant pleaded the general issue, with notice of payment in full. Defendant’s claim was that, deducting- the interest as usury, he had paid all the principal advanced by plaintiff in the course of their many transactions, and he sold the premises in good faith, as he owed plaintiff nothing.
In announcing decision, the court found defendant liable on the special count, and the judgment entered was in tort, not assumpsit. Body execution was issued against defendant, served, and he has been languishing in jail ever since.
After judgment, defendant filed voluntary petition in bankruptcy and scheduled the judgment as a claim. Defendant was discharged September 19, 1932. He then petitioned the circuit court to vacate the judgment and proceedings thereunder and discharge him from custody, on the ground that the judgment was released by the discharge in bankruptcy. The court denied the petition, and defendant has appealed.
The issue concerns the following provision of section. 17 of the bankruptcy act, 42 U. S. Stat. at Large, p. 354 (11 USCA, § 35):
“Debts not affected by a discharge. — A discharge in bankruptcy shall release a bankrupt from all of his provable debts, except such as * # * are liabilities for * * * wilful and malicious injuries to the person or property of another.”
Injuries within the meaning of the exception are not confined to physical damage of destruction. Wilful and malicious conversion is an injury to property within the meaning of the present law, and liability therefor is not released by the discharge. The exception has been held to cover conversion of motor vehicles (In re Brier, 3 Fed. [2d] 709; In re Franks, 49 Fed. [2d] 389); collections on accounts assigned as security (Baker v. Bryant Fertilizer Co. [C. C. A.], 271 Fed. 473); and sales of corporate stock (McIntyre v. Kavanaugh, 242 U. S. 138 [37 Sup. Ct. 38]). These cases dispose of any confusion which may have existed by reason of In re Toklas Bros., 201 Fed. 377, and Crawford v. Burke, 195 U. S. 176 (25 Sup. Ct. 9).
Nor need the property be tangible and physical. Injury to personal or property rights is within the exception. Thus, a judgment for damages for criminal conversation is not released, because the cause of action is a violation of marital rights of the husband in the person of the wife, to the exclusion of all others, and is a wilful and malicious injury to the person and property of the husband within the meaning of the exception in the statute. Tinker v. Colwell, 193 U. S. 473, 481, 485 (24 Sup. Ct. 505).
“Malice” means “a wrongful act, done intentionally, without just cause or excuse.” Tinker v. Colwell, supra, 486; Nunn v. Drieborg, 235 Mich. 383, 386.
The testimony supports the conclusion of the court that defendant did not act in good faith, but was guilty of at least íegal malice in selling the property upon which plaintiff had security. Under the above authorities, the destruction of plaintiff’s security by such sale was an injury to property within the exception of the statute, and defendant was not released from liability by discharge in bankruptcy.
Order affirmed, with costs.
McDonald, C. J., and Clark, Potter, Sharpe, North, Wiest, and Btjtzel, JJ., concurred. | [
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Potter, J.
Plaintiffs file a bill to construe the last will and testament of John C. Day, deceased; establish and enforce a trust alleged to be provided therein; for an accounting, to set up and establish such trust, cancel notes given to defendant for borrowed money, discharge a real estate mortgage securing the payment of such, promissory notes, injunction, and other relief. Prom a decree for plaintiffs, defendant appeals.
Defendant denies all the material allegations of plaintiffs’ bill of complaint, and joins to its answer a demurrer clause alleging plaintiffs are not in court with clean hands, and there is no equity on the face of the bill. Defendant and appellant claims the questions involved are:
First. "Where, by will, a testator bequeathed the sum of $50,000 to be paid to a legatee in five annual instalments of $10,000 each, and directed the executor “to keep said trust fund invested so far as possible,” was an intent manifested to prefer said legatee over other general legatees, so as to require the executor to establish a trust fund out of the first assets of the estate (which are insufficient to pay all legacies in full), and render it personally liable if it did not do so?
Second. Did the allowance of three annual accounts of the executor by the probate court, after proper statutory notice, in each of which accounts the treatment of all legatees on a parity was reported, adjudicate the propriety of such treatment?
Third. Did the defendant assume the duties of a-testamentary trustee, and in law accept the trustee ship, despite the fact that it did not qualify as a testamentary trustee, and did treat the plaintiff as a common legatee?
Fourth. Are the proceedings here brought jurisdictionally defective by reason of the failure of the plaintiffs to join as parties hereto the other legatees and devisees named in the will?
Plaintiffs make a counter-statement of questions involved, as follows:
First. Does the language of the “third” paragraph of the will fulfill the requirements of a valid testamentary declaration of trust?
Second. Was it the duty of the defendant and appellant, as testamentary trustee, to obtain possession of the trust res as soon as possible, and then establish and administer the trust in accordance with the testator’s directions?
Third. Was it the duty of the defendant and appellant, as executor, to undertake and complete the administration of the estate as expeditiously as possible?
Fourth. Would the property in the estate have been more than sufficient for all purposes had the appellant, in its dual capacity of executor and trustee, acted with the diligence required of it by law?
Fifth. Can the defendant and appellant avoid all liability for its failure to perform its duties as testamentary trustee by a showing that it has never formally qualified as such?
Sixth. Are the orders entered by the probate court for the county of Wayne, allowing the annual accounts filed by the defendant and appellant as executor, res judicata of the propriety of its conduct in failing to establish and administer the trust as directed by the testator’s will?
John C. Day died testate November 28, 1927, leaving one direct descendant, Ruth Day MacKenzie, a granddaughter, one of plaintiffs. John C. Day had a substantial estate. By the third paragraph of his will he provided:
“I give and bequeath to my granddaughter, Ruth Day MacKenzie, the sum of $50,000, to be paid to her. by my executor hereinafter named, as follows: $10,000 per annum, the first payment to be made one year from the date of my death. I direct my said executor to keep said trust fund invested so far as possible, and to allow the income therefrom to accumulate and to become part of the principal of said fund. In the event of the death of my said' granddaughter before said fund is exhausted, I direct that said payments be made to her child or children, and upon the death of said child or children before said fund is exhausted or in the event such children predecease their mother, the balance of said fund shall become part of the residue of my estate to be disposed of as directed in paragraph six hereof.”
Paragraph 7 of the last will and testament of John C. Day, deceased, provided:
“I hereby name and appoint the Union Trust Company, of Detroit, Michigan, to be the executor of this will, and request that no bond be required of it as such executor, and I hereby revoke all former wills by me made. It is my wish that my executor consult with my wife during the administration of my estate and that her wishes be carried out as far as possible.”
This will was admitted to probate in Wayne county January 4, 1928, and administration of said estate granted to the Union Trust Company. An inventory of the property of the estate was made and an appraisal filed indicating a value of $469,-368.33 as of the date of the death of the deceased. Subsequently there was a consolidation of the Union Trust Company and Guardian Trust Company into the Union Guardian Trust Company, defendant herein.
In the first and final accounts of defendant as special administrator, and first account as executor, of the will of John C. Day, deceased, filed November 30, 1928, defendant alleged it had paid all of the debts of said deceased and expenses of administration to date; had delivered the 'household furniture and effects to Ruth Fay Boomer Day, widow; paid to the widow the sum of $35,000 in accordance with the second paragraph of the will of deceased; that it has not carried out the balance of the provisions of the second, third, fourth, and fifth paragraphs of the will of said deceased in relation to legacies. Its account showed it paid to Ruth B. Day, assignee, the sum of $1,171.57. This account was allowed by the probate court January 3, 1929, and defendant, as special administrator, was discharged; the final account of the defendant as special administrator standing as its first account as executor.
The second account of defendant as executor was filed January 10, 1930. In it, it alleged it has made substantial payments on account of the legacies bequeathed under the last will and testament of deceased ; that it had not been able to complete the administration of said estate and pay the legacies in full, inasmuch as it was necessary to reduce certain assets to cash, which, up to that time, it had not been able to do; that it was making’ every effort to dispose of the balance of the personal property for the purpose of paying the legacies in full. This account was allowed by the probate court February 13,1930.
December 13,1930, defendant filed its third annual account. In it, it alleged it has made substantial payments on account of the legacies bequeathed under the last will and testament of deceased; had not been able to complete the administration of said estate and pay the legacies in full, inasmuch as it was necessary to reduce certain assets to cash, which it had not been able to do. That it was making every effort to dispose of sufficient property for the purpose of paying the legacies in full. This account was heard and allowed January 15, 1931.
The bill of complaint herein was filed January 16, 1932, and January 19, 1932, an amended bill of complaint was filed, after which defendant filed its fourth annual account as executor of the will of deceased, in which it alleged it had delivered specific household furniture and effects to Ruth F. Day Chandler, in accordance with the provisions of the second paragraph of the will of said deceased; that approximately 40 per cent, had been paid on account of the cash legacies bequeathed under the third, fourth, and fifth paragraphs of the last will and testament of deceased; that it had made a pro rata distribution of each dollar distributed, one-third to Ruth P. Day Chandler on account of the one-third personal property bequeathed to her under the second paragraph of the will, and two-thirds pro rata on account of the cash legacies bequeathed under the third, fourth, and fifth paragraphs of the will, as modified by the codicil.
Many other things were set up by the petition for the allowance of defendant’s account. It was represented that some one of the following courses would have to be pursued in connection with this estate:
a. Sell remaining assets at public auction sale, if possible.
b. Legatees and devisees advance funds for the purpose of preserving the assets until sales can he made.
c. Cash legatees and residuary legatees and devisees agree, to a division of the properties in payment of the legacies.
Further showing was made that a copy of this account had been mailed to the last known address of each of the cash legatees and devisees and residuary legatees and devisees of the will.
The elaborate showing made in defendant’s petition for allowance of its fourth annual account was probably the result of the institution of suit by plaintiff.
The case was tried and an able opinion filed by the trial court June 4, 1932, finding:
“1. That it was the intention of the testator to provide a trust fund as so expressed in paragraph three of the will.
“2. That at the time of the probate of the will, there were ample funds in the estate out of which such trust fund could have been carved.
“3. That the intention of the testator in relation to the'trust fund should have been carried out with reasonable diligence.
“4. That the proceedings in probate court were not res judicata.
“5. That the failure of defendant to formally accept the trusteeship did not, under the circumstances, defeat the coming into being of the trusteeship, defendant'having entered upon its duties as such, even though it did not follow the expressed wish of the testator.
“6. That the instant proceedings are not jurisdictionally defective for failure to join all other legatees.”
June 29, 1932, decree was entered substantially in accordance with the prayer of the bill.
A court of equity has jurisdiction to construe wills incidental to its general power over trusts and trust estates. 40 Cyc. p. 1838. A bill may be filed by anyone interested in the determination of the questions involved. 40 Cyc. p. 1848.
“It is by reason of the jurisdiction of courts of chancery over trusts that courts having equitable powers, as an incident of that jurisdiction, take cognizance of and pass upon the interpretation of wills. They do .not take jurisdiction of actions brought solely for the construction of instruments of that, character, nor when only legal rights are in controversy. It is when the court is moved on behalf of an executor, trustee, or cestui que trust, and to insure a correct administration of the power conferred by a will, that jurisdiction is had to give a construction' to a doubtful or disputed clause in a will. The jurisdiction is incidental to that over trusts.” 3 Pomeroy’s Equity Jurisprudence, § 1156.
This court has long recognized the right of an executor, in case he doubted his right to act, to apply to a court of equity for the construction of the will.
“If the executor was at all uncertain whether the testator meant to have the mortgage paid out of this legacy, his plain duty was to have filed his bill for a construction of the will. If the executor refused to pay the legacy, and there was a contention as to the true intent and meaning of the will, a court of equity should have been appealed to for a settlement of that question.” Byrne v. Hume, 84 Mich. 185.
In Dean v. Mumford, 102 Mich. 510, it is said:
“A preliminary question is raised as to the jurisdiction, it being claimed by defendants that, except at the suit of a trustee or cestui que trust who asks a direction as to the execution of a trust, a court .of chancery has no jurisdiction to construe a will or declare any or all of its provisions invalid. But, however this may be, the executors have answered in this case, and in terms submitted the question of the construction of the will to the court. As it is undoubted that they might have invoked the jurisdiction of the court for that purpose by a bill, we think that, they having submitted the question, the court may properly maintain jurisdiction.”
In Bowers v. Smith, 10 Paige Ch. (N. Y.), 193, it is held (quoting from syllabus):
“An executor takes the legal estate in the personal property of the testator as trustee for the legatees or next of kin, and the court of chancery having general jurisdiction in cases' of trusts, any person having an interest in such property, either as a legatee or distributee of the decedent, may file a bill in that court, against the executor, to have the construction of the will settled, or to have the question as to the validity of any of its provisions determined, so far as concerns the interest of the complainant in the property; and to have a decree against such executor for such parts or portions of the property as he is legally and equitably entitled to receive.”
In Dudley v. Gates, 124 Mich. 440, it is said of the construction of a will:
“If its provisions are of doubtful meaning, either the executor, legatee, or heir should apply to a court of chancery for their construction. Byrne v. Hume, 84 Mich. 185, 191. This has been the universal practice in this State, and is also the rule in other courts. 1 Woerner, Administration, § 222; Hawes v. Humphrey, 9 Pick. (26 Mass.) 350, 361 (20 Am. Dec. 481); In re John’s Will, 30 Ore. 494 (47 Pac. 341, 36 L. R. A. 242); Hegarty’s Appeal, 75 Pa. 503.”
There is no doubt of the right of plaintiffs to maintain this suit to settle the construction of the will of deceased.
It is claimed necessary parties are not before the court. Who are necessary parties in a particular suit may depend upon the allegations of the bill of complaint, and the relief sought. In some cases the duty to join other parties may arise from the relief sought by defendant.
3 Comp. Laws 1929, § 14021, provides:
“No action at law or in equity shall be defeated by the nonjoinder or misjoinder of parties. New parties may be added and parties misjoined may be dropped, by order of the court, at any stage of the cause, as the ends of justice may require.”
This statute, broad and comprehensive in its terms, is remedial in character and liberally construed. Gillen v. Wakefield State Bank, 246 Mich. 158; Windoes v. Colwell, 247 Mich. 372. The bill of complaint may not be dismissed because of the nonjoinder of necessary parties. If other parties are necessary they may and should be joined.
If the trial court had jurisdiction upon any well-settled ground of equity jurisdiction it was its duty to retain the case and grant complete relief.
‘ ‘When any matter becomes involved in a chancery suit, the necessities of justice and equity require that all persons and all things concerned in the controversy shall be brought before the court to have their respective interests charged or protected, and to end the controversy once for all.” Brown v. Kalamazoo Circuit Judge, 75 Mich. 274, 280 (5 L. R. A. 226, 13 Am. St. Rep. 438).
“It is not, in general, within the province of courts of chancery to retain jurisdiction and grant relief, where the party has a clear, certain and adequate remedy at law. But it has often been held, and in New York and some of the other States it is regarded as a settled rule, that where a court of chancery has gained jurisdiction of a cause for any purpose of relief, it will retain it, for the purpose of giving full relief.” Whipple v. Farrar, 3 Mich. 436, 447 ( 64 Am. Dec. 99).
Since the decision in Whipple v. Farrar, supra, above cited, the rnle that a court of equity having obtained jurisdiction upon any well-settled ground of equity will retain it to grant complete relief has become firmly established in the jurisprudence of this State. Miller v. Stepper, 32 Mich. 194; Wallace v. Wallace, 63 Mich. 326; Drayton v. Chandler, 93 Mich. 383; Chase v. Boughton, 93 Mich. 285; George v. Wyandotte Electric Light Co., 105 Mich. 1; Hall v. Nester, 122 Mich. 141; Scripps v. Sweeney, 160 Mich. 148; Culver v. Avery, 161 Mich. 322; Nelson v. Gibe, 162 Mich. 410; Allen v. Heft, 200 Mich. 593.
Does the will of deceased create a trust? One definition of a trustee is:
“A person in whom some estate, interest, or power in or affecting property of any description is vested for the benefit of another.” 1 Perry on Trusts (7th Ed.), §1.
A trust is:
“An obligation upon a person arising out of a confidence reposed in him to apply property faithfully and according to such confidence.” 1 Perry on Trusts (7th Ed.), § 2.
“A trust is in the nature of a deposition by which a proprietor transfers to another the property of the subject intrusted, not that it should remain with him, but that it should be applied to certain uses for the behoof of a third party.” 1 Perry on Trusts (7th Ed.), §2.
Sir Edward Coke’s definition of a “use” has been adopted as an accurate legal description and definition of a “ trust. ’ ’ In his words applied to a use,
“A trust is a confidence reposed in some other, not issuing out of the land, but as a thing collateral, annexed in privity to the estate of the land, and to the person touching the land, for which cestui que. trust has no remedy but by subpoena in chancery.” 1 Perry on Trusts (7th Ed.), § 13.
“The doctrines of trusts are equally applicable to real and personal estate, and the same rules will govern trusts in both kinds of property.” 1 Perry on Trusts (7th Ed.), § 16.
Applying the definitions of a trust to the language of the will in question, it seems clear that the testator intended to make a bequest to plaintiff of $50,000, which $50,000 was to be kept invested, as a trust fund, so far as possible. That the income from this fund or the balance thereof which had not been paid over to the plaintiff in accordance with the terms of the will was to be added to the principal on hand, and from this $50,000 and the accumulations thereon plaintiff was to be paid the sum of $10,000, plus the accumulations on such trust fund as remained in the hands of the executor one ye.ar from the date of the death of the deceased, and that these $10,000 annual payments, plus the accumulations upon the amount of the trust fund remaining in the hands of the executor, were to be made each year until the whole amount of the principal of said $50,000 fund plus the accumulations thereon were paid to her.
It is strenuously insisted in the allowance of these annual accounts the probate court construed the will of testator and this constitutes an adjudication of plaintiffs’ rights in the case at bar. In Raseman v. Raseman, 234 Mich. 237, it was said:
“The allowance of the annual accounts of testamentary trustees on notice is made by statute final and binding upon all parties in interest except for fraudulent concealment or fraudulent misrepresentation. ’ ’
This holding is a mere restatement of the provisions of 3 Comp. Laws 1929, § 15900, which provides:
“The decree of the court having jurisdiction allowing any account of a trustee shall, except in cases of fraudulent concealment or fraudulent misrepresentation on the part of the trustee, be final and conclusive against all persons interested in such account and legally competent at the date of such decree, and against all other persons who are or may become interested therein, although unborn, unascertained or legally incompetent to act in their own behalf, if their general guardian or guardian ad litem has, after having been duly appointed, assented to such account, or has been heard thereon, or been notified of the hearing thereon; but such decree may be appealed from in the manner provided in the next section of this chapter.”
The rule as to the binding force and effect of the accounts of executors and administrators is entirely different. 3 Comp, Laws 1929, § 15922, provides:
“Every executor and administrator shall at the end of one year from the time of his appointment, and at least once in each year thereafter during the continuance of the administration, and at such other times as he may be directed by the probate judge, make and file in the probate court an accurate account of all moneys and other properties in his hands, as such executor or administrator, and of any expenditures and disbursements thereof; in case any such executor or administrator shall fail to make and file his: account as herein provided, it shall be the duty of the probate judge to require and notify him so to do.”
By 3 Comp. Laws 1929, § 15567, an executor must give a bond “to render a true and just account of his administration to the probate court within one year, and at any other time when required by such court.”
3 Comp. Laws 1929, § 15923, provides for giving-notice of hearing and examining an executor’s .account ; and by section 15924 if the executor’s account is not satisfactory to the probate court, he may be removed and some other suitable person appointed in his place. By section 15925 an executor may be liable on his bond for damages which may accrue by reason of his failure to account. Section 15927 provides that before an executor’s account may be allowed, notice shall be given to all persons interested ; but there is nothing in the statute relating to the allowance of accounts of executors and administrators making their allowance an adjudication of the terms of the will of deceased.
The allowance of an annual account of an executor or administrator is final „and conclusive as to the amount of money received by him and the disbursements made by him, in the absence of fraud or breach of trust; but this has nothing to do with the construction of the will under which an executor acts. Annual accounts are final and conclusive against the executor, in the absence of fraud and mistake, as to receipts and disbursements where properly allowed after due notice.
Such annual accounts make it incumbent upon the executor to account for the inventoried value of the property received, and this may be shown by the receipt of an equivalent cash value, or by showing- the property is worthless, has been destroyed by accident, without the fault of the executor, belonged to some other person, or upon a fair salé brought less than the appraised value thereof.
The rule is general that orders of the probate court allowing annual accounts are final and conclu sive as to all matters included therein, but they do not adjudicate what is not before the court and not included in the annual account. Their allowance is binding as to what is included therein, but is not binding as to what is not included. The allowance of a final account of an executor may be conclusive as to receipts and disbursements, but even the allowance of a final account may not amount to a construction of the will.
If, however, upon the conclusion of the probate of the estate of a testator, upon the allowance of the administrator’s final account, the assignment of the residue of the property of the estate is made in accordance with the construction of the will of the deceased by the probate court, then, under such circumstances, the court having to construe the will in order to make a proper order of distribution, such order of distribution properly entered is valid and binding as a construction of the will, if not appealed from. Dudley v. Gates, 124 Mich. 440.
In Cromwell v. County of Sac, 94 U. S. 351, suit had been brought by one Smith against the county to recover judgment for the amount of coupons on bonds issued by defendant. The coupons belonging to plaintiff Cromwell were among those sued upon. There was judgment for defendant. Plaintiff then brought suit against the county to recover on the bonds to which the coupons, the validity of which had been adjudicated in the Smith Case, belonged. It was claimed the suit in the Smith Case constituted former adjudication in the Cromwell Case. The court said:
‘«,jg a difference between the effect of a judgment as a bar or estoppel against the prosecution of a second action upon the same claim or demand, and its effect as an estoppel in another action between the same parties upon a different claim or cause of action. In the former case, the judgment, if rendered upon the merits, constitutes an absolute bar to a subsequent action. It is a finality as to the claim or demand in controversy, concluding parties and those in privity with them, not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. * * *
“Where it is sought to apply the estoppel of a judgment rendered upon one cause of action to matters arising in a suit upon a different cause of action, the inquiry must always be as to the point or question actually litigated and determined in the original action, not what might have been thus litigated and determined. ’ ’
In Jacobson v. Miller, 41 Mich. 90, the rule of Cromwell v. County of Sac was quoted and approved. The general principles of former adjudication were again extensively considered in Bond v. Markstrum, 102 Mich. 11, where the rule of Cromwell v. County of Sac and Jacobson v. Miller were again reaffirmed.
In Bond v. Markstrum it is said (p. 16):
“A former adjudication of the right of action, where the court had jurisdiction of the subject-matter and of the parties, is unquestionably a bar to an action for the same debt or claim, and is conclusive where the same subject-matter is sought to be again litigated, no matter how, between the same parties. In such case it is no answer to say, ‘There were questions which were not raised or litigated.’ ”
But when a suit is sought to be maintained or defeated by showing former adjudication of questions upon which it depends, it must appear such questions were litigated as a matter of fact, were submitted to and decided by the jury, and were not collateral inquiries, but crucial questions in the other controversy. An adjudication in favor of a claim will not be conclusive of the minor issues on which the right depends unless it appears not only that they were submitted to the jury but were considered and passed upon by them. According to the great weight of authority parol evidence is admissible to ascertain whether a given question in issue was litigated, submitted, and decided, and possibly in some cases whether it was material.
In LeRoy v. Collins, 165 Mich. 380, it is said:
“The first essential of the rule of res judicata is the identity of the matter in issue. The ‘matter in issue’ is defined to be ‘that matter upon which the plaintiff proceeds by his action, and which the defendant controverts by his pleadings.’ See Chand on Res Judicata, p. 35. If the same subject-matter comes in question in a second action in a court of last resort, it is bound by its own former decision. Bigelow on Estoppel (1st Ed.), p. 16.
“ ‘A matter or question, either of law or- fact, is res juclicata, or set at rest, as to adverse parties and their resx>ective privies, if it was a material issue in the proceeding, directly involved, and not merely incidentally cognizable nor collaterally in question, and was adjudicated after a contest, by a final judgment on the merits.’ 1 Van Fleet’s Former Adjudication, p. 2.”
‘ ‘ The probate court derives norie of its jurisdiction or power from the common law, but must find the warrant for all of its doings in the statute. Its jurisdiction, powers, and duties are prescribed by law. * * *
“The probate court possesses the power to adjudicate and settle, by the decree it may make, an administrator’s account; but after the merits have been thus passed upon, and the final adjudication put in the form of a decree, we find no authority given to the probate court to review such decree, or to set the same aside.” Grady v. Hughes, 64 Mich. 540, 545.
“There is nothing appearing in the probate proceedings to put in question the jurisdiction of the probate court to make the order on the accounting, and to include all that was in fact included. This being so, the attempt is now made to attack this judgment collaterally on the merits. This it was held in Clark v. Fredenburg, 43 Mich. 263, cannot be done.” Holden v. Lathrop, 65 Mich. 652.
Clark v. Fredenburg, supra, involved a final account of an executor. Its allowance by the probate court was held to be conclusive.
Shurte v. Fletcher, 111 Mich. 84, holds an order of the probate court refusing to probate an estate because of a prior agreement in writing not res judicata of the terms of the contract. “There was nothing in the pleadings to indicate that the probate judge was called upon to construe the effect of the alleged settlement.”
In re Foyle’s Estate, 147 Mich. 544, holds the entry of an order settling and allowing the final account of the administrator and allowing his discharge “was not an adjudication by the court determining who was entitled to this estate and assigning the residue to such persons.”
‘ ‘ The order of the probate court allowing the first account, being unappealed from, is conclusive upon appellant.” Nowland v. Rice’s Estate, 138 Mich. 146.
In Calhoun v. Cracknell, 202 Mich. 430, it is said:
“Under the statute cited, the probate court is invested with power, and, at the time of the disposition of the estate, has jurisdiction to construe a will and make disposition accordingly.”
In Thompson v. Thompson, 229 Mich. 526, 531, it is said:
“The order on final settlement is the culmination of the entire procedure. The corpus of the estate is affected thereby. To make such order, the will must be construed and the rights of parties in the estate not disposed of by the will must be determined. It is an expression of the judgment of the court as to all matters properly included or necessarily involved therein. It may not be in accordance with the correct construction of the will or of applicable statutes, and yet it must be held to be binding and conclusive on all persons interested, if the notice of hearing required by the statute has been given. ’ ’
In Re Rahn, 241 Mich. 29, it was held the allowance of the annual account of an executor was not res judicata, where there was fraud, and the court quoted Raseman v. Raseman, 234 Mich. 237, which did not involve the account of an executor but of a testamentary trustee, as to whom the allowance of an annual account is by statute made binding and conclusive, but which statute does not apply to the final account of an executor.
In Riebow v. Ensch, 220 Mich. 450, 454, it is said:
“The probate court in the course of the administration of estates has power to construe a will and the construction placed upon a will in the exercise of such jurisdiction is res judicata unless an appeal is taken.”
In Creek v. Laski, 248 Mich. 425, 430 (65 A. L. R. 1113), it is said:
“A judgment is not res judicata unless the identical matter in issue in the subsequent proceeding was determined by the former adjudication.” Citing Murphy Chair Co. v. American Radiator Co., 172 Mich. 14.
In Harvey v. Security Trust Co., 242 Mich. 284, it is said:
‘ ‘ The probate court, by its order assigning residue to the trustee, recognized the existence of a valid trust and that the estate was to be disposed of according to the will ‘so far as such will may operate upon it.’ * * * The order of the probate court is in effect that the provision of the will is valid. The question has been adjudicated by the court of competent jurisdiction. Such adjudication may not be ignored. Nor is it open to collateral attack.”
Morton v. Johnston, 124 Mich. 561, holds (quoting from syllabus):
“Items allowed to an administrator on a partial account, after notice to persons interested as required by 3 Comp. Laws 1897, § 9441, are not open to attack in the final accounting, except on the ground of fraud unknown at the time of allowance. ’ ’
In Porter v. Long, 124 Mich. 584, it -was held (quoting from syllabus) :
“On a bill to compel an accounting by defendant in the respective capacities of surviving partner and executor of his partner’s will, moneys wrongfully withheld by him from the estate as compensation for managing the firm business, which have never entered into his annual accounts as executor, should be charged against him, though, such annual accounts have been duly approved by the probate court.”
In Re Ward’s Estate, 152 Mich. 218, 240, where an item in the executor’s first annual account was appealed from, it was said:
‘ ‘ The second annual account involved only the new items not included in the first account and the adjudication thereon only affected such items. The order allowing the second account was conclusive as to the additional items included therein, provided there was no fraud, omission of credit, or concealment of the true state of the account, in which event the finding could be challenged upon a subsequent accounting. ’ ’
In Powell v. Pennock, 181 Mich. 588:
“The final account of the administrator did not mention the property involved in this litigation, and can only be binding and conclusive as to the matters therein contained. ’ ’
The rule to be deduced from the authorities is that an annual or a final account of an executor or administrator is conclusive as to all matters which are before the court and are adjudicated in its allowance, but the order of allowance is not final or conclusive and does not constitute an adjudication in matters which were not before it upon the accounting and which were not considered by the court or passed upon in allowing the account of the executor of the estate.
There is nothing in the annual accounts of defendant, heard and allowed before the bill in this case was filed, which showed defendant had converted the trust estate provided to be set up for plaintiff Ruth Day MacKenzie, or that the probate court construed or intended to construe the will of deceased so as to permit defendant so to do. The allowance of these annual accounts does not amount to a former adjudication or a construction of the will involved adverse to plaintiffs’ claims.
Defendant failed to comply with the will of testator. It was its duty as executor to comply therewith so far as possible; cause the $50,000 trust fund to be set up and invested within the period of one year. It is claimed defendant may not be held liable as a trustee because it never qualified as such; that tlie office of executor and trustee are separate and distinct, and defendant may not be held liable as a trustee when it did not act as such. Gibney v. Allen, 156 Mich. 301. That defendant did not qualify as trustee is no defense. It did act as executor. What plaintiffs complain of is the failure of defendant as executor to carry out the terms of the will of deceased; accept the trust created by the will or aslc the court to appoint a trustee to carry out its provisions; keeping the money in its hands belonging to such trust, which should have been created and administered as such, as executor; converting it to the use of, and attempting to' administer it as a part of, the general estate of deceased, in violation of the terms of the will, in fraud of plaintiff’s rights and to her injury and damage. It makes no difference, under the facts, whether defendant is treated as executor or trustee. It was the duty of defendant to carry out the terms of the will, properly, collect the assets of the estate, cause such trust to be set up, and to turn the sum of $50,000 bequeathed to plaintiff over to it, in trust, to be invested and the principal and accumulations thereon paid to plaintiff as provided in the will, and defendant is liable to plaintiff for not so doing.
These principles have been repeatedly asserted, affirmed, and enforced. Jewett v. Schmidt, 83 App. Div. 276 (82 N. Y. Supp. 49); M’Gachen v. Dew, 15 Beavan, 84 (51 Eng. Repr. 468); Grove v. Price, 26 Beavan, 103 (53 Eng. Repr. 836); Pomroy v. Lewis, 14 R. I. 349; Campbell v. Clough, 71 N. H. 181 (51 Atl. 668); Bean v. Commonwealth, 186 Mass. 348 (71 N. E. 784); Caney v. Bond, 6 Beavan, 486 (49 Eng. Repr. 914); Pinkerton v. Sargent, 112 Mass. 110; Waring v. Darnall, 10 G. & J. (Md.) 127; Neff’s Appeal, 57 Pa. 91; Cross v. Petree, 10 B. Mon. (49 Ky.) 413; 28 Halsbury’s Laws of England, pp. 117-139. The defendant as executor is liable as for a conversion of the interest of plaintiff in the trust fund provided for by the will of the testator (In re Ryer, 94 App. Div. 449 [88 N. Y. Supp. 52]), and liable for all breaches of the ordinary trusts which arise from its office as executor (In re Marsden, L. R. 26 Ch. D. 783). The failure of an executor to perform his duty, which results in loss to the beneficiaries of the will of the testator, amounts to a devastavit, whether from fraud, conversion, negligence, or maladministration. Bacon’s Abridgment, title, Executors. The failure of the defendant as executor of the estate of deceased to set up the trust fund provided in the will of deceased amounts to a devastavit. 14 Halsbury’s Law of England, p. 316. The precise sum plaintiff should receive and which defendant should pay is what the former has lost by the failure of the latter to properly administer the estate of deceased. Perrin v. Lepper, 72 Mich. 454.
Good faith is a defense, where a trustee, acting within the limits of his powers with proper prudence and diligence, commits mere mistakes or errors of judgment, but is not a defense where a trustee disregards the limits placed upon his power by law or by the trust instrument. Gibney v. Allen, supra; 28 Am. & Eng. Enc. Law (2d Ed.), p. 1063.
We find no reason to disturb the decree of the trial court, which is affirmed, with costs.
McDonald, C. J., and Clark, Sharpe, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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Potter, J.
Prior to the effective date of Act No. 228, Pub. Acts 1925 (3 Comp. Laws 1929, §§ 13498, 13499), Meyer Levine and Aaron Witus, together with their respective wives, gave a trust mortgage on lands and premises in Detroit. The mortgage purported to assign the rents, issues, apd profits of the mortgagors’ property 'as additional security. Default occurred in the payments due on the mortgage, and foreclosure of the mortgage was commenced and a receiver appointed by the court to manage and control the mortgaged property, collect the rents, income, and profits, and account and dispose of them under the legal orders of the court. The parties to the suit consented to the appointment of a receiver: This consent conferred no additional jurisdiction upon the court, a judicial tribunal, — not an arbitrator. Jurisdiction arises from law, and not from consent of litigants. The receiver appointed qualified and acted, and June 2, 1932, had on hand $894.27, when the trial court made an order directing this money be used to pay taxes levied and assessed against the mortgaged real estate. Prom this order, defendant E. L. Barbee, the owner of the record title of the real estate, appeals. It is claimed E. L. Barbee is only the nominal holder of the title, and the real owner is someone else. We are not concerned with this. 3 Comp. Laws 1929, §§12969, 12971.
The mortgagors and subsequent holders of title under conveyances from them were and are entitled to the possession of the mortgaged property, and the rents, income, and profits thereof until fore closure sale and the expiration of the equity of redemption. Wagar v. Stone, 36 Mich. 364. The appointment by the court of a receiver, except under extraordinary circumstances, does not alter this rule. Hazeltine v. Granger, 44 Mich. 503. The court has no jurisdiction, power, or authority to order, direct, or decree a receiver appointed by the court to take possession of and'collect and disburse the proceeds arising from the rents, income, and profits of the real estate mortgaged; to apply the proceeds thereof to the payment of preferred or other creditors. The taxes assessed against the mortgaged property may be a lien against it, but this gives the court no power or authority to direct the application of moneys arising from something not legally mortgaged, upon which the sovereignty has no lien, to the payment of taxes on the mortgaged property so as to relieve it, or the purchasers thereof at mortgage sale, from the lien of the taxes thereon, and thus wrongfully convert property not legally mortgaged to such payment. Wagar v. Stone, supra; Hazeltine v. Granger, supra; Union Trust Co. v. Charlotte General Electric Co., 152 Mich. 568; Union Guardian Trust Co. v. Rau, 255 Mich. 324.
Decree reversed. Costs to appellant.
McDonald, C. J., and North, J., concurred with Potter, J. | [
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Clark, J.
In a contest between legatees, construction is sought of the will and codicil of Selina Rodger Warren:
“I, Selina Rodger Warren, of the city of Detroit, county of Wayne, State of Michigan, being of sound and disposing mind and memory, do hereby make, publish, and declare the following as and for my last will and testament, viz:
‘ ‘ First: I direct that all my just debts and funeral expenses be paid in full.
“Second: I give, devise and bequeath to the following-named persons the sum set opposite their names, to-wit:
“To my sister, Annie C. Rodger, $5,000;
“To my sister, Mary B. Brownell, $4,000;
“To my niece, Jessie B. Davis, $1,000;
“To Paul E. Davis, son of my said niece, $2,000;
“To Francis Mullen and John Mullen, grandsons of my late husband, $500 each;
“To my friend Henrietta Wood, of Detroit, Michigan, $500;
“To Mrs. Laura Ried, the wife of Robert Ried, San Marcos, Cuba, $1,000;
“To the First Baptist Church, of Detroit, Michigan, the sum of $500, with the request that the principal be kept intact and the income be used for the fellowship fund. I give the further sum of $500 to the First Baptist Church with the request that it be added to its endowment fund.
“Third: All the rest, residue and remainder of my estate, of every character whatsoever, and wherever situated, I give, devise, and bequeath to the First Baptist Church, of Detroit, Michigan, the same and the proceeds thereof to be kept invested and re-invested from time to time and the income thereof to be devoted to the care and relief of old people of the Baptist denomination in the city of Detroit, preferably for the support of the Baptist Old Peoples Home if one is established. Should the First Baptist Church as such for any reason not be qualified by law to take and hold such residue as a trust fund for the purposes hereinbefore mentioned then I give, devise and bequeath said residue to the persons who shall at the time of my death be trustees of the First Baptist Church, they to take and hold said residue for the same purposes hereinbefore specified.”
A few days later she herself made and executed the following codicil:
“In looking over the last third paragraph in my will made August 18, 1926,1 realize it is too drastic, that in giving for one purpose more than I realized when signing so hereby make it null and void by changing it as follows:
“To my nephew Paul E. Davis’ little daughter, $500, in trust to her father;
“To the Baptist Children’s Home, $500';
“All my personal property to my sister, Annie C. Rodger.
“The remainder to be left in trust to my sister, Annie C. Rodger with the exception of family broach which I give to my sister Mary B. Brownell. The remainder to be given in trust to my sister Annie C. Rodger (as executor to be used for home and foreign missions or for anything that will further the work of the Kingdom).”
The question is:
“Does the codicil modify the will to the end that the bequests mentioned in the codicil, to-wit:
“To my nephew Paul E. Davis’ little daughter, $500, in trust to her father;
“To the Baptist Children’s Home, $500;
“All my personal property to my sister, Annie C. Rodger ;
“The family broach to my sister Mary B. Brown-ell;
“stand on the same footing as the bequests mentioned in paragraph two of the will, or, does the codicil only modify and affect paragraph three of the will so that the codicil is operative only as to any residue remaining after the bequests mentioned in the second paragraph of the will are wholly satisfied ? ’ ’
The decision of the probate court was,—
“That a proper construction of said will and-codicil is that the codicil is operative only as to any residue remaining after the bequests mentioned in paragraph two are wholly satisfied.”
The decision was affirmed in the circuit court, and Annie C. Rodger has appealed. There is contention over the language: “so hereby make it null and void by changing it.” If all of paragraph three be null and void, it is nonexistent, and there is nothing to' change. The words must be read together. Testatrix intended to set aside the distribution of the residue under the third paragraph and to provide a new and different distribution of such residue. She intended to make null and void former distribution under paragraph three and to effect change by a new and different distribution. And it appears from extrinsic evidence in aid of construction that to accept the construction urged by appellant, as stated in the alternative of the question presented, would be to give to her the bulk of the estate, which it is clear testatrix did not intend. Sondheim v. Fechenbach, 137 Mich. 384.
Affirmed.
McDonald, C. J., and Potter, Sharpe, North, Pead, Wiest, and Btjtzel, JJ., concurred. | [
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McDonald, C. J.
Tbe plaintiff was injured in a collision between a hook and ladder truck which he was driving and a street car at the intersection of Harper and Concord avenues in the city of Detroit, Michigan. At the time of the accident he was an employee of the city fire department. The street railway system is owned and operated by the city. The injuries received by the plaintiff were permanent. He made application for retirement under the provisions of the city ordinance, and was retired on pension at half pay. The pension has since been paid regularly at a monthly rate of $105 and accepted by the plaintiff in lieu of compensation under the workmen’s compensation statute (2 Comp. Laws 1929, § 8407 et seq.). Though receiving the pension, he claims the right to maintain this common-law action against his employer for damages. The trial court thought otherwise, and for that reason directed _a verdict in favor of the defendant. The plaintiff has appealed.
Both parties were under the provisions of the compensation statute. As originally enacted, an agreement by tbe employee to waive compensation was declared to be invalid. 2 Comp. Laws 1915, § 5450. Because lie could not waive compensation, an employee of a city which had adopted a pension system might recover both compensation and pension for the same injury. To remedy this situation the legislature, by Act No. 173, Pub. Acts 1921, amended the law by adding a proviso in substance that the employee might waive his right to compensation and accept a pension in lieu thereof, but could not have both. 2 Comp. Laws 1929, §§ 8413, 8436. '
The first theory advanced by the plaintiff is stated in his brief as follows:
“Plaintiff had the right to waive the provisions of the workmen’s compensation act and accept a pension in lieu thereof. When he waived the provisions of said act he was no longer subject to any provision of said act. Having voluntarily placed himself beyond the workmen’s compensation act, he had the same rights and privileges that any other person had, to wit, the right to sue the party responsible for the accident.”
We cannot accept this theory as a basis of recovery. The plaintiff was bound by the provisions of the act. So was the city, his employer. When he waived his right to compensation for the purpose of securing a pension, he did not thereby release himself from other provisions of the act. Prior to accepting the pension, he had two remedies, each for the same wrong. He had a right to compensation or to a pension. He could not have both. He could not maintain a common-law action-for damages against his employer, for his right to maintain such action was taken from him by the statute, 2 Comp. Laws 1929, § 8410. Having elected to be bound by the statute, he is not entitled to a remedy which it has abolished.
But the plaintiff claims if he is still bound by the provisions of the act he is entitled to maintain his suit at law under authority of 2 Comp. Laws 1929, § 8454, which reads:
“Where the injury for which compensation is payable under this act was caused under circumstances creating a legal liability in some person other than the employer to pay damages in respect thereof, the employee may at his option proceed either at law against that person to recover damages, or against the employer for compensation under this act, but not against both, and if compensation be paid under this act the employer may enforce'for his benefit or for that of the insurance company carrying such risk, or the commissioner of insurance, as the case may be, the liability of such other person.”
It is contended by the plaintiff that, as the city of Detroit owned and operated its street railway system, the agency that caused his injury, which was a function distinct from that in which he was employed, the city was “some person other than the employer,” within the meaning of the above-quoted provision of the statute.
No authorities are cited by the plaintiff to support this contention. It is too plainly untenable .to require argument. Nor is there any merit to the claim that because the city was operating a street railway system as a private enterprise the workmen’s compensation law has no application.
We find no error.
The judgment is affirmed, with costs to the defendant.-
Ci*ark, Potter, Sharpe, North, Pead, Wiest, and Btjtzel, JJ., concurred. | [
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Butzel, J.
Charles V. Othoudt and E. Pearl Othoudt invested $4,000 in two pairs of silver black foxes, claimed to be of a particularly fine strain. It was expected that there would be a large profit made from their increase. Plaintiffs ranched the foxes at one of the fox farms of defendant Addison Fur Corporation. Two contracts were entered into, one referring to the increase from the foxes, and the other, dated October 1, 1927, referring to a ranching fee of $150 per year for each pair of foxes. The latter contract contained the following provisions:
“Neither said foxes nor the benefits accruing to second party under any pooling agreement shall be removed from said ranch until said ranching fees shall have been fully paid and satisfied and if said second party neglects or refuses to pay said ranching fees within 15 days after the same or any part thereof shall have become due, then in addition to its other remedies, said first party may offer said foxes and/or said benefits for sale (at either private or public sale) and may dispose of the same for the best price that may be secured, and deduct from the money so received the amount of such ranching fees and pay the remainder over to the second party or it may put such remainder to the account of said second party in any bank in the village of Evart or city of Jackson, Michigan.
“Said ranching fees shall not abate nor be diminished by virtue of the death and/or escape of said foxes and/or their offspring inasmuch as this contract is a part of and' subject to the standard pooling agreement. * * *
“It is further agreed that this agreement shall expire on October 5, 1928, unless prior to October 1, 1928, a further written agreement for ranching’ after said expiration date is entered into.”
Plaintiffs paid the ranching fee for the year ending October 1, 1928. In a letter dated November 13, 1928, urging plaintiffs to trade their foxes for shares of stock in National American Furs, Inc., defendant stated:
“Ranching pees due up to October l, 1928.
“That no exchange of foxes for stock can be completed nor can animals be removed from the ranches until all ranching fees due are paid.”
Plaintiffs made no objection to this provision in the letter nor did they, prior to the commencement of the present proceedings, on September 15, 1931, demur or object in any manner to the demand for payment of the ranching fees as provided, or to the lien asserted by defendant on the foxes and their increase. The foxes required food, shelter, and care. Plaintiffs, by their own testimony, showed that their aim was to obtain a cash settlement for the foxes and their increase. They frankly stated that they wanted neither the foxes nor stock in the corporation, but desired a return of their money. The testimony further shows that defendant at no time refused to give up the foxes upon payment of the charges for their care. Plaintiffs brought the instant suit in trover for the value of the foxes. Defendant, in its answer, denied that it had ever refused- to turn over the foxes to plaintiffs upon payment of the charges due for which it claimed a lien.
The trial judge held that defendant never claimed to own the foxes, but only sought payment for their keep, while plaintiffs desired that defendant take the foxes off their hands and pay for them; that under the most liberal construction of all of the testimony, plaintiffs had not established or main tained any conversion on the part of the defendant. The record fully sustains the judge’s opinion. Plaintiffs appeal from a judgment of no cause of action.
Plaintiffs claim that defendant was not entitled to the lien which it was asserting, and, therefore, a demand for the return of the foxes was unnecessary to establish a conversion. At common law, an agister who kept and cared for animals of any kind had no lien for their keep, unless one was created by special agreement. There was a lien, however, when the animal was trained for racing, and for medical treatment, etc., on the theory that there was an improvement of the object bailed. But this did not extend to the ordinary expenses of keeping and feeding. Towle v. Raymond, 58 N. H. 64. Evidently there was no fox farm industry when 3 Comp. Laws 1929, § 13186, was first adopted, for it only entitled one to a lien for the care of horses, mules, neat cattle, or swihe. 3 Comp. Laws 1929, § 13194, providing for a lien for additional expenses incurred in the keeping of property against which a lien has been properly asserted and remains unpaid, refers only to the lien theretofore provided for in section 13186, supra, although the statute refers to horses, cattle, sheep, swine or “other beasts.” A careful analysis of the wording of section 13194, supra, shows that it does not apply to animals other than those described in section 13186, supra.
We believe, however, that in the present instance there was a lien created by special contract. A lien created by express or implied contract will be enforced. Whitlock v. Heard, 13 Ala. 776 (48 Am. Dec. 73); McCoy v. Hock, 37 Iowa, 436. The contract of October 1, 1927, distinctly provided for a lien, although it also stated that the agreement should expire within one year. Plaintiffs claim that all of the terms of the contract became ineffective at the end of the year, and that, therefore, no lien continued in existence. The contract did expire at the end of the year to the extent that, after that time, the obligation to keep the foxes was no greater than that of plaintiffs to ranch the foxes with defendant. We believe, however, that there was an implied agreement on the part of the plaintiffs to pay for the ranching of the foxes on the same terms as had been previously agreed upon, including a lien for charges accruing while the foxes remained with defendant.
On November 13,1926, shortly after the expiration of the year term, defendant notified plaintiffs that the animals could not be removed from the ranch until all ranching fees due were paid. Plaintiffs made no effort to claim their property, but continued to permit the foxes to remain in defendant’s care for several more years. They knew that they were wild animals, which could not be set at large, but required care*and attention at a large expense. Plaintiffs’ conduct was such that it amounted to an acquiescence and implied consent to a lien, and they are now estopped from complaining. See Schneider v. Dayton, 111 Mich. 396. They are entitled to the foxes and their increase upon payment of the charges due. There was no .conversion by defendant.
The testimony brought out the fact that defendant had thought it advisable and necessary to pelt some of the increase. The decision in this case is without prejudice to any claim that plaintiffs may have arising out of such pelting.
The judgment is affirmed, with costs to defendant.
McDonald, C. J., and Clark, Potter, Sharpe, North, Fead, and Wiest, JJ., concurred. | [
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59
] |
McDonald, C. J.
The Fidelity Bank & Trust Company of Detroit closed its doors against business on October 7, 1931, and was taken over by the banking commissioner. It had been trustee for the Prudential Investors’ Incorporation, which was engaged in the business of investing funds for parties with whom it had contracts for that purpose. These contract holders paid their money to the trustee, who invested it as directed by the Prudential corporation. In the course of business the Fidelity Bank & Trust Company, trustee, had in its hands trust funds amounting to $17,215.93. Having information that the trustee was not in a sound financial condition, the Prudential corporation directed it to deposit the money with the defendant, Detroit Trust Company, which it did, by cheek drawn on the National Bank of Commerce, Detroit, and received therefor two certificates of deposit equaling the amount of the check and payable to itself as trustee. This business was transacted about 10:30 o’clock in the forenoon of October 6, 1931. The Detroit Trust Company indorsed the check and deposited it with the First National Bank of Detroit for collection in the morning of October 7,1931. The First National Bank presented it for payment to the National Bank of Commerce, the drawee, through the clearing house on October 8, 1931. In the meantime the Fidelity Bank & Trust Company had been closed by the banking commissioner and the drawee bank notified not to honor any of its checks. Payment was refused, and the check returned to the Detroit Trust Company. After the failure of the Fidelity Company, the Continental Bank & Trust Company of New York was appointed successor-trustee, and began this suit to recover the amount of the two certificates of deposit. The issue was tried by the court without a jury. Judgment was rendered in favor of the defendant. The plaintiff has appealed.
Many angles of this case are discussed in the briefs of counsel, but in the last analysis the issue narrows down to the question whether the defendant exercised ordinary care in presenting the check in time for payment. A check must be presented within a reasonable time after it is received by the depository bank. A reasonable time for presentment is defined by statute, Act No. 240, Pub. Acts 1931, § 6 (b) as “not later than the next business day following the day on which the item is received. ’ ’ This statute was quoted and construed by Mr. Justice North in Bay City Bank v. Concordia Mutual Fire Ins. Co., 260 Mich. 611, which decision we think is a controlling precedent for the instant case. The material facts are substantially the same. In that case the business places of all the parties were in the same city. The check was delivered to the Bay City Bank on December 1, 1931, early enough for presentment to the drawee bank on that day or for deposit for collection with its collecting bank. It was not deposited with the collecting bank until December 2d, and was not presented for payment through the clearing house before the drawee bank failed and closed on December 3, 1931. If the Bay City Bank had acted promptly when it received the check it could have been cleared and paid on December 2d, while the drawee bank was still doing business. On these facts this court held there was due presentment.
In the instant case the business places of the parties were in the same city. The check was delivered on October 6,1931, to the Detroit Trust Company in time for presentment to the drawee bank on that day or for deposit with its collecting bank. If the trust company had taken either course on that day the check would have been honored. Instead, the deposit was not made with the collecting hank until October 7,1931, and did not get through the clearing house in time for presentment until October 8th, after the drawer had failed and its checks were not collectible. Under authority of the Bay City Bank Case, we must hold that there was no negligent delay in presenting this check.
But counsel for the plaintiff claim a distinction between this case and the Bay City Bcmk Case, in that in the latter case the depository followed its regular custom of business in presenting the check, whereas in this case it did not do so.. The statute of 1931 does not make negligence of a bank depend on its failure to follow its usual custom of doing business. Banks cannot always do so. In this case, it was the custom of the defendant to deposit its checks with the First National Bank for clearance twice daily, but there was testimony that at the time the check in question was received the trust company had an unusually large number of dividend checks, which clogged the business as customarily conducted. However, the fact that the company had two opportunities to deposit the check with its collecting bank on the day it was received is not so important as it would have been prior to the 1931 statute. Since the enactment of this statute, a bank acts with sufficient promptness if the check is deposited with its collecting bank not later than the next business day after it is received.
A further distinction claimed by the plaintiff is that in this case Mr. Browning, president of the Detroit Trust Company, knew that the drawer of the check, the Fidelity company, was in a precarious .financial condition, and that it was his duty to hurry the check on for presentment. We see no merit in this contention. It will be noted that the bank upon which the check was drawn did not fail. It was solvent and had sufficient money with which to honor the check. It was the drawer that failed. It issued the check on October 6th, and was closed by the bank ing commissioner on the next day. It must have known that it was in a very precarious financial condition and might he closed at any time. With this knowledge of its condition it did not draw out the money and pay cash for the certificates of deposit, but adopted the more convenient way of paying by check. It made no request for speed in presenting the check for payment. In the absence of some instruction in that respect, the defendant company was under no obligation to act with greater promptness than was required by the statute. We think the trial court correctly decided the issue.
The judgment is affirmed, with costs to the defendant.
Clark, Potter, Sharpe, North, Wiest, and Butzel, J J., concurred. Fead, J., did not sit. | [
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North, J.
The defendants conduct a candy store and restaurant in the city of Ann Arbor. Plaintiff, 64 years of age, with a lady companion entered defendants’ place of business about noon on the 29th of August, 1931, for the purpose of securing their noonday lunch. The premises occupied by defendants’ business consisted of what was formerly two store rooms of about equal width, the dividing partition having been removed. There was an entrance at the front of each store. Plaintiff and her companion entered at the more southerly door. Immediately at their right as they entered was a soda fountain, and to their left a show case extending along the dividing line between the two store rooms. At the rear of each room were booths equipped for serving defendants’ customers. Approximately 30 feet from the entrance was a space left open between the show case nearer the front and the booths at the rear as a passageway from one part of the store to the other. There was a difference in floor levels, the floor of the northerly portion being lower than the floor of the part through which plaintiff entered. In the passageway, which was five feet wide, a step was constructed of ample width and of a height which substantially divided in equal proportions the difference in the levels of the two floors. The riser of the lower step was 6% inches, .and the other 5% inches. Plaintiff and her companion decided to go to the northerly portion of the restaurant, and when doing so plaintiff failed to see the steps, fell, and was rather severely injured. She brought this suit for damages, and at the conclusion of her proofs the circuit judge directed the jurj^ to render a verdict in favor of the defendants. From the judgment entered on the verdict, plaintiff has appealed.
It is appellant’s claim that the record presented an issue of fact for determination of the jury both as to defendants’ negligence and as to the contributory negligence of plaintiff. In reviewing the question presented, we must construe the testimony most favorably to appellant. The negligence charged to defendants is their failure to maintain sufficient notice or warnings to apprise their customers of the difference in the floor levels in the two portions of their premises; and the failure to maintain sufficient artificial lighting to properly illuminate the passageway and the steps; and also:
“It became the further duty of the defendants not to maintain attractive show-cases so displaying the goods, wares, and merchandise on sale by the defendants in such a manner as to distract the attention of customers rightfully on said premises at the points where said premises became more dangerous by reason of steps and changes in floor levels.”
If defendants’ premises were properly lighted, they were not required to post warnings of the steps between the two portions of their place of business. If the place was sufficiently lighted the steps themselves constituted as effective notice to defendants ’ customers as it was possible to give.
Touching plaintiff’s claim that her attention was distracted, by the display of defendants’ wares, it may be said that there was nothing unusual as to the manner or character of 'the display. We find nothing in this record which would justify the claim, at least made inferentially in behalf of appellant, that the display of the merchandise here kept for sale because of its attractive nature can be held' to lessen the degree of care which plaintiff was required to exercise for her own safety.
Also, construing the record most favorably to the appellant, there is no testimony which tends to sustain the allegation of the declaration that these steps constituted “concealed dangers.” The undisputed testimony discloses that the floor was of inlaid tile with a pronounced border near the northerly side of the .room, where plaintiff first entered, and extending across the approach to the steps. In effect this border plainly marked what may be referred to as the upper step or tread. The edge of each tread is plainly marked by a dark strip of cork, which is in decided contrast with the white tile used in the general construction of the balance of the treads and the floor. Neither the adjacent show case at plaintiff’s left nor the booths at her right in any way obstructed her range of vision. As she turned to her left towards the steps she must have passed over at least six feet of level floor before reaching the first descent. Unless there was inadequate light, the undisputed facts foreclose any question of a “concealed danger.”
The remaining question is whether the trial court was justified in holding as a matter of law that these steps were adequately lighted. A careful review of the record brings the conclusion that he was. The real cause of this accident is disclosed by plaintiff’s testimony on direct examination:
“I didn’t see the steps, and in some manner I over-stepped and that was all there was, and I was gone. * * * I fell. * * * I found myself on the floor. * * * I did not see no steps.
(Cross-examination)
“Q. Yon say that at the time that you were looking at a show-case?
“A. Yes, sir. * * *
■ “Q. You would be walking from the south tpward the north?
“A. Yes, sir.
“Q. But as you were walking from the south toward the north, you were looking to the left, that would be toward the front of the store, which would be west, wouldn’t it?
“A. I think so.
“Q. And looking at the display of g'oods in the show-case?
“A. Yes, sir.
“Q. And as you walked along, suddenly, as you say, you stepped into space, lost your balance, and fell?
“A. Yes, sir.”
Briefly, the undisputed record is that at the time of the accident the restaurant was electrically lighted by eight drop lights of 200 watts each, four 100-watt lights along the center beam between the two rooms, and also bracket or side wall lamps. Two of the 200-watt lamps were suspended from points of best advantage for lighting the steps on which plaintiff fell. That the store in general was adequately lighted is conclusively established by plaintiff’s own testimony. Her eyesight was good, and repeatedly she testified'that she looked at and saw defendants’ general display of merchandise; and that as soon as she entered the store she looked across the room a distance of 30 feet or more and ascertained where the customers were located at the various places of serving, and as the result of such observation she and her companion decided they would go to the northerly side to be served. From plaintiff’s own testimony, as well as from other uncontradicted testimony, it conclusively appears that the illumination was such that plaintiff could have seen the steps had she looked. There is no credible testimony that defendants were guilty of negligence in failing to properly light their place of business.
“It has long since been recognized that falling downstairs, where the mishap was not imputed to unknown or concealed defects, belongs to that class of ordinary accidents which ought to be imputed to the carelessness or misfortune of the sufferer.” Davis v. Buss Machine Works, 169 Mich. 498, 500.
"While not on all fours, this case falls within the scope of our decisions reported in Larned v. Vanderlinde, 165 Mich. 464; Brown v. Berles, 234 Mich. 353; Shorkey v. Great A. & P. Tea Co., 259 Mich. 450; and Garrett v. W. S. Butterfield Theatres, Inc., 261, Mich. 262.
The syllabus of the Shorkey Case, sufra, reads as follows:
“Storekeeper is not insurer of safety of customers, but it is his duty to use reasonable care to provide reasonably safe place for them on his premises.”
The following from the Garrett Case, sufra, is quite applicable to the instant case:
“Different floor levels in private and public buildings, connected by steps, are so common that the possibility of their presence is anticipated by prudent persons. The construction is not negligent unless, by its character, location, or surrounding conditions, a reasonably prudent person would not be likely to expect a step or see it. * * * The situation contained no element of a trap. A reasonably prudent person, watching where he is going, would have seen the step. Defendant is not under legal duty to prevent careless persons from hurting themselves. We think defendant was not guilty of negligence.”
Judgment of the circuit court is affirmed, with costs to appellees.
McDonald, C. J., and Clark, Potter, Sharpe, Fead, Wiest, and Butzel, JJ., concurred. | [
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On Rehearing.
North, J.
This case is before us on rehearing. Former decision is reported in 259 Mich. 630. The sole relief sought by plaintiff in his bill of complaint is specific performance. For reasons stated in our former opinion plaintiff was not entitled to the relief prayed. However, upon further consideration incident to this rehearing, we are of the opinion that by affirming the decree entered in the circuit court dismissing the bill of complaint on condition defendant would lay a sidewalk and gravel the street in front of plaintiff’s lot, an inequitable result was accomplished, unless plaintiff is granted the option of seeking relief in a proper proceeding. Plaintiff’s contract provides for walks and graveled streets throughout the whole subdivision. To require him to accept less is to change the terms of his contract to his disadvantage. This the court does not have the power to do. In view of the complication resulting from a breach of the contract by each of the parties to this suit, it was quite impossible to do exact equity in a suit for specific performance. The decree entered provided for as nearly'an equitable disposition of the controversy as was possible in view of the specific remedy sought and the record presented.
Upon rehearing, plaintiff claims he is entitled to cancellation and an accounting. The record before us is not sufficiently full to render possible consideration of all questions pertinent to cancellation. Something akin to cancellation seems first to have been injected into the case by plaintiff incident to settling the decree in the circuit court. He then tendered a proposed decree which provided that he should assign his vendee’s interest to defendant, and thereupon she should pay plaintiff all sums theretofore paid on the contract purchase price regardless of whether payments were made to defendant or her predecessors, and also regardless of whether they were made by plaintiff or the prior vendees through whom he holds. The circuit judge refused to enter the proposed decree; and, without amending his bill of complaint or amplifying the proof in the case, plaintiff appealed. As stated above, the record before us is not sufficient for an adjudication of the equities incident to cancellation and an accounting. Without definitely so holding, it may well be questioned whether the necessary parties defendant are before the court to enable plaintiff to secure a full accounting.
To avoid a possible inequitable result, plaintiff will be given the option of filing in the circuit court in chancery, within 30 days after decision herein, a bill for cancellation and accounting against proper parties defendant, or of instituting a suit at law to recover any damages he may have sustained. In default of plaintiff instituting either of such pro ceedings, a decree will be entered herein in accordance with the original opinion; but in the event plaintiff exercises the option of instituting further proceedings in the circuit court, a decree will be entered in the instant case dismissing plaintiff’s bill of complaint, with costs of this cburt to appellee.
McDonald, C. J., and Clark, Potter, Sharpe, Pead, Wiest, and Butzel, JJ., concurred. | [
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] |
Clark, J.
Defendant appeals from judgment upon conviction of violation of 3 Comp. Laws 1929, §•§ 11922, 11947, providing in part:
“The total liabilities to any bank of any person or of any company, corporation, or firm for moneys advanced * * * shall at no time exceed one-tenth part of the amount of capital and surplus of such bank.” 3 Comp. Laws 1929, § 11922.
‘ ‘ EvePy officer, clerk, agent, or employee of a bank who shall knowingly aid or assist in a violation of any of the provisions of this act, shall be deemed guilty of a felony, and upon conviction shall be punished,” etc. 3 Comp. Laws 1929, § 11947.
From January 1, 1930, to July 5, 1930, the period covered by the information, defendant was cashier and director of Union State Bank of Mio. He was also bookkeeper, and knew the' extent and amount of his primary liabilities to the bank. The capital and surplus of the bank was $24,725. -
A chief contention of defendant is that a large part of his liability to the bank during the time in question was by renewal of notes, and that hence liability was not as of the time and for “moneys advanced.”
Documentary -evidence is that on December 31, 1929, defendant was liable to the bank as maker of note to it in the sum of $1,750. There is also evi deuce of direct borrowing from the bank by defendant beginning in April, 1930, and continuing to July, 1930, by which defendant increased his liabilities to the bank to a total sum in excess of $5,000. Defendant testified that all or nearly all of his notes given during the period stated were renewals of former notes, but this question, if it were of any importance, might be decided against him on this record.
The purpose of the statute is to limit the amount which may be loaned or advanced to any person, corporation, etc. The words of the statute “moneys advanced” denote moneys paid which are to be repaid, 2 C. J. p. 32. All of the notes of defendant held by the bank represented moneys advanced by the bank and on which defendant was primarily liable, a liability within the statute. So it is not important whether defendant’s total primary liabilities to the bank at the time in question were upon renewals of his note or notes or upon new borrowing with new or original notes, or upon both. It is important that the total of such liabilities be kept within the limit fixed by the statute. Assuming, as the record shows, that on or about January 1, 1930, defendant owed the bank on his note or notes less than $2,000, and was not offending, yet as soon as his additional notes and borrowings increased, to his knowledge, his total primary liabilities to the bank beyond 10 per cent, of capital and surplus, beyond $2,472.50, the statute was violated. On this interpretation of the statute, it is practically undisputed that defendant was offending as of the time fixed in the information. We find no error in this regard.
At the opening of the trial, defendant’s counsel made what was termed a motion to quash. We pass technical objections and speak of two matters suggested. On defendant’s motion, the venue was changed from Oscoda circuit court, twenty-third circuit, to Ogemaw circuit court, thirty-fourth circuit. Defendant’s counsel stated orally that Hon. Fred P. Smith, circuit judge of the twenty-sixth circuit, presided at the trial upon designation of the State presiding circuit judge. That was proper, if true. People v. Phelps, 261 Mich. 45. The prosecuting attorney of Oscoda county being disqualified, a special prosecuting attorney was appointed, before changing the venue, by the circuit court of the county of Oscoda. This is as it should be. 1 Comp. Laws 1929, § 1293; 3 Comp. Laws 1929, § 17125.
The trial judge having correctly instructed as to the law, and there being no dispute of fact worthy of notice> the jury returned the only verdict compatible with their oaths. In this situation argument of the special prosecutor can hardly be held to have produced prejudicial result. On full consideration, we find no reversible error.
Affirmed.
McDonald, > C. J., and Potter, Sharpe, North, Fead, Wiest, and Butzbl, JJ., concurred. | [
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] |
Fead, J.
Plaintiff had verdict against both defendants for injuries caused by negligent operation of an automobile by Brower. On motion, judgment non obstante was entered for Eding.
Eding conducts a Ford sales agency at Hamilton. Harry Yredeveld, a mail carrier, had an agreement with Eding by which, upon payment of $100 and purchasing a tire, he traded his car for a new one about every six months. December 4th, Yredeveld took his car to Eding’s garage, left it, and received a new car in exchange. Eding was not present when he came in. Someone about the garage procured the license plates for the new car at Allegan. Yredeveld said Eding came in and gave him the plates. Yredeveld did not pay the $100 until some days later, and did not assign the certificate of title to his old car to Eding until December 16th. The evening of the 4th, Brower took the ear and injured plaintiff. He was not upon any business of Eding at the time. Plaintiff’s parents testified that Eding said he owned the car and had permitted Brower to take it.
The question is whether Eding was “owner” of the car driven by Brower before he received assignment of the certificate of title (1 Comp. Laws 1929, §4660 [Act No. 46, Pub. Acts 1921], as amended, Act No. 65, Pub. Acts 1931), and therefore is liable for Brower’s negligence under 1 Comp. Laws 1929, § 4648 (Act No. 302, Pub. Acts 1915, as amended).
Under section 3 of the 1921 act (1 Comp. Laws 1929, §4660), this court consistently has held, in cases involving actions for negligent injuries as well as controversies between the immediate parties to a sale, that title to a motor vehicle passes from seller to purchaser when the former delivers to the latter assignment of certificate of title, and not before. Endres v. Mara-Rickenbacker, 243 Mich. 5; Ittleson v. Hagan, 245 Mich. 56; Bos v. Holleman De Weerd Auto Co., 246 Mich. 578; Kelly v. Lofts, 253 Mich. 552; Scarborough v. Detroit Operating Co., 256 Mich. 173; Kruse v. Carey, 259 Mich. 157; Schomberg v. Bayly, 259 Mich. 135.
Plaintiff contends these cases are not applicable, because their effect would be that the failure to observe section 4660 in making the sale would deprive plaintiff of rights of action against Eding, reserved or granted by section 4648.
Section 4648 provides: “Nothing herein contained shall be construed to abridge the right” of action for damages resulting from violation of the act. It does not restrict other legislation. It reserves to an injured person his common-law remedies for negligence. It grants a new right of action against the “owner” of a motor vehicle driven with his consent, regardless of such common-law elements as personal negligence or the relation of master and servant. The act does not set up the conditions of vesting of title on sale. Transfer of ownership from seller to purchaser was governed by the general law of sales.
Section 3 of the 1921 act (1 Comp. Laws 1929, § 4660) changes the law of sales as applied to motor vehicles. It has no effect upon the common-law or statutory rights of action reserved or granted by section 4648, except as it declares the conditions of ownership and transfer of title on sale.' Conse quently, there is no conflict between section 4648 and section 4660 and the decisions thereunder. Section 4648 confers a remedy against the “owner” without prescribing when a purchaser becomes the “owner” on sale. Section 4660 supplements section 4648 in this respect by providing how and when a purchaser becomes “owner.”
Both acts provide that the term “owner” shall include any person renting or having exclusive use of a motor vehicle for more than 30 days. Plaintiff contends the transaction may be viewed as a conditional sale with exclusive right of use of the car in Eding, and, therefore, within the definition of “owner” in both acts. If it may be so viewed, the conditional sale was void, and no title passed to Eding before transfer of certificate. Scarborough v. Detroit Operating Co., supra.
In harmony with the cases cited above, we hold that Eding was not the owner of the car at the time of the injury to plaintiff, and, therefore, was not subject to the statutory liability.
At the trial, plaintiff was permitted to amend her declaration to charge Eding. with negligence in allowing Brower to use the car, knowing he was a reckless driver. The court held there was not sufficient evidence to submit the issue to the jury, The court was right. Plaintiff now complains that she was not permitted to make the proof. The complaint is not included in the assignment of errors, and we find in the record no offer of proof of such liability other than demand for right to engage upon a line of examination of witness in the hope of discovering evidence. For both reasons, the complaint must be held ineffective.
Judgment affirmed, with costs.
McDonald, C. J., and Clark, Potter, Sharpe, North, Wiest, and Btttzel, JJ., concurred. | [
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Sharpe, J.
The opinion filed by the trial judge so • clearly states the facts in this case, and the law applicable thereto, that we adopt it as our own. It follows:
“Plaintiffs, owners of property in the Huntington Woods subdivision in the township of Royal Oak, filed this bill to compel the city of Detroit and the zoological park commission to remove a fence erected in the middle of Huntingdon road. Plaintiffs also pray that certain proceedings taken by the city of Royal Oak to vacate a portion of the street be decreed null and void. The facts out of which the controversy arose are substantially as follows:
“In the spring of 1916 Charles W. Burton purchased 355.58 acres of land in Royal Oak township, under an agreement with one Follett, then manager of the Detroit zoological society, whose authority to act for and bind the society is conceded, that the south 100 acres would be deeded to the society and each would give a strip of land 30 feet wide along the boundary for the purpose of establishing a 60-foot highway. On April 28, 1916, Burton conveyed the 100-acre parcel to the zoological society, and within a short time thereafter conveyed the remainder to the Huntington Woods Company, of which he was president, and in which Follett was a stockholder and a director. The company thereupon caused the property to be platted as the Huntington Woods subdivision, and gave a bond to the township conditioned that it would improve the streets and build the sidewalks shown on the plat within a period of three years and the plat was thereupon duly accepted by the public authorities.
“Under the agreement between Follett and the Huntington Woods Company, a 60-foot street was laid out between the two properties known as Huntington road, commencing at Woodward avenue, and running in a westerly direction. The north 30 feet of the road was dedicated on the plat as a public street, but the south 30 feet, which was on the property theretofore deeded to the Detroit zoological society, was not dedicated. The society however erected a high, woven wire fence, attached to iron posts imbedded in concrete, set back 30 feet south of the center of the road as laid out on the plat, but never entered- into any formal dedication of such land as a public highway, although there is no doubt each, party intended, to set aside a 30-foot strip of land, making a 60-foot street some 4,400 feet long between the two properties. At the intersection of Ludlow street, where Huntington road leaves the property of the zoological society, the street is shown on the plat as having a width of 60 feet, which conforms to the width of the remainder of the streets.
“Both parties participated in the work and expense of grading and improving the street, and, some time during the year 1917 or 1918, in paving a 24-'f oot strip in the center with a hard surface material known as rubber stone. Several blocks west from what is now Woodward avenue, the street traversed a low, marshy strip of land, and during times of wet weather it was impassable, but this condition was remedied by the construction of a county drain some time about 1925. Before the construction of the drain automobiles frequently became mired in this portion- of the street when attempting to cross the low grouiid. The street was used more or less by the public from the time the plat was recorded, and was extensively used by the authorities of the zoological park after title to the zoological park property was conveyed to the city of Detroit in 1923.
“Subsequent to 1921 there are many acts on the part of municipal authorities showing that the road was regarded as a public highway. From 1921 until the village of Huntington Woods was incorporated in 1926, taxes were levied by the township of Royal Oak upon the property in the subdivision for road repair purposes, and road work was performed by the township upon all of the roads in the subdivision. During the years 1925 to 1929 the city of Royal Oak performed work on the street. The village of Huntington Woods also performed work on the street at intervals between 1926 and 1929, plowed snow in the winter and placed calcium chloride, paid for by the zoological park commission, on the street in the summer with city equipment, and cut weeds and assumed to regulate traffic and parking thereon.
“When the zoological park was opened in the summer of 1928, the traffic on the road increased to such an extent that it was difficult for residents even to cross the street. Traffic officers of the village of Huntington Woods and the city of Royal Oak were stationed along the street and a plan was advanced to make it a one-way street towards Woodward avenue. To facilitate parking, the Detroit zoological park commission caused a strip of cfushed stone to be spread immediately north of its fence and south of the improved portion of the road, erected a plank barrier to prevent cars from being driven into the fence, and placed parking signs at intervals instrucing drivers to park their ears on the crushed stone.
“Traffic conditions thereafter became so bad that petitions were filed with the authorities of the city of Royal Oak and the village of Huntington Woods in the summer of 1928. In the fall of 1928 barriers were erected at each end of the road by the village of Huntington Woods. In the summer of 1929 the city of Royal Oak took proceedings to vacate the north 30 feet of the street for a distance of several blocks west from Woodward avenue, being all that portion of the platted street within the city limits. The Detroit zoological park commission in the spring of 1929 moved its fence north a distance of 30 feet, along its entire north line, so the fence now incloses the south half of the 24-foot strip of stone or macadam pavement. As a result of these actions the entire 60 feet of the former road for a distance of several blocks west of Woodward avenue is closed, and, for the remainder of the distance, only the former north half of the road, which includes only 12 feet of the former hard surface of the road, is open to use.
“After the property was platted many lots were sold and a number of pretentious homes erected, several of which front on Huntington road. The plats of the property which were shown to prospective purchasers show all roads upon the subdivision, including Huntington road, to be 60 feet wide. The road was formerly a direct outlet to Woodward avenue for residents on the street, who are now obliged to detour through back roads, causing in some instances extra travel of approximately one-half mile.
“In my judgment there are at least two reasons why this court must hold that the city of Detroit had no right to obstruct a street of which the public had had the uninterrupted use for upwards of 14 years.
“1. The facts constitute a common-law dedication.
“It is unnecessary to refer to the many cases in which this question has been discussed, as the rule is well’settled that a dedication under the statute is not necessary where the facts are sufficient to establish a dedication at common law. In order to create a common-law dedication, there must be, first, an intention on the part of the owner to dedicate lands or premises to a public use; and, second, such dedication must be accepted by the public authorities. The acceptance may be evidenced either by express declaration or by acts of user indicating an intention to accept such property for the public use or purpose to which the owner has by his declarations or acts set it apart.
“It appears from the foregoing statement of facts all of the elements necessary to constitute a common-law dedication are present. By mutual agreement between the owners of the abutting property, a 60-foot street was laid out, one-half of which was formally dedicated as a part of the Huntington Woods subdivision. As laid out, it formed the principal outlet to Woodward avenue for all of the lots in the southern portion of the subdivision. The zoological society erected a permanent fence along the south line, leaving a strip of land 60 feet wide which conformed to the platted property on the north. The street was graded and a strip in the center 24 feet wide páved. Trees were set out along the street line and sidewalks built along one side, Lot lines and the lines of intersecting streets were fixed in accordance with the street lines. Surely in the face of this testimony, which is undisputed, it cannot be said there was no intention on the part of both the Huntington Woods Company and the Detroit zoological society to dedicate the street to public use.
“The evidence of acceptance by user is equally convincing. The street was in use by the public almost from the time it was laid out. It is true that prior to 1925, during the wet seasons of the year, a small section was in bad condition, and automobiles frequently became mired when attempting to use it, but it was in use nevertheless as a public thoroughfare. Taxes were assessed upon property in the road assessment district in which the street was located for the improvement of the street, and work was done upon it by the public authorities. Not only was road work done upon the street, but the public authorities placed calcium chloride upon it on occasions, cut weeds and removed snow therefrom during the winter. The .street was patrolled by municipal authorities, who regulated traffic and parking thereon in the same manner as other streets in the subdivision. Until acute traffic problems were presented, through excessive use of the street by the public, it does not appear to have occurred to anyone that it was not open to public use.
“2. Use of the street for 10 years or more constitutes a public highway.
“The statute provides:
'' 'All highways * * * that shall have been used as such for ten 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 eight years or more, shall be deemed public highways.’ 1 Comp. Laws 1929, § 3936.
“Here the road bad been laid out, its boundaries plainly indicated, and a 21-foot pavement built in tbe center, which had been used by the public for more than 10 years. The statute clearly prevents the abutting property owners or the public authorities from now closing the street except in the manner authorized by law.
“I have examined the files in the Wayne circuit court, where certain purchasers of lots brought suit against the Huntington Woods Company for rescission of their contracts on the ground that at the time of sale it was represented that Huntington road was a public street. The cases were heard by Judge Lamb, who came to the conclusion that the street was a public street, and dismissed the bills of complaint. While it is true his conclusions would not be binding in this action, the fact that another court has entered such a decree is at least entitled to respectful consideration.
“So far as the action taken by the city of Royal Oak to close the north half of the street for several blocks from Woodward avenue is concerned, its action appears to have been strictly in accordance with the city charter. Whether such action was justified is not a question for this court. So long as it appears that the public authorities acted in accordance with law, their actions are not subject to review by this court.
“A decree will be entered in accordance with the foregoing, restraining the defendants city of Detroit and the zoological park commission from blocking or obstructing the southerly 30 feet of Huntington drive as it existed prior to 1929. The bill will be dismissed as to defendant city of Royal Oak, without costs. Plaintiffs will recover taxable costs against the remaining defendants.”
The decree entered pursuant thereto is affirmed, with costs to appellees.
MoDonalu, O. J., and Clark, Potter, North, Peau, Wiest, and Btjtzel, JJ., concurred. | [
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Wiest, J.
This is a proceeding, in behalf of the receivers of the General Necessities Corporation, to recover moneys in the hands of defendant David A. Brown and claimed to belong to the corporation. Defendant David A. Brown was president of the General Necessities Corporation. In April, 1928, the Necessities Corporation borrowed $75,000 from the Madison investment Corporation. Mr. Brown indorsed the notes given for this loan, and, as security, executed a trust mortgage to the Guardian Trust Company, covering real property owned by him. "When the indebtedness was due, an extension of time and an increase of $25,000, for the benefit of Mr. Brown, was desired, and Mr. Brown again gave a mortgage on his property to secure the loan of $100,000, evidenced by a series of notes, payable over a period of one'year. It is claimed that he did this under an agreement with the directors of the Necessities Corporation that the loan would be repaid out of a prospective sale of the ice cream plant, and the proceeds from such sale would be placed in his hands for that purpose. The ice cream plant of the Necessities Corporation was sold to the Borden Company, and the purchase price was paid in stock of the Borden Company, having a market value, it is claimed, of $650,000. The Borden Company stock was placed in the hands of Mr". Brown, who pledged the same with a New York bank for a loan of $300,000 to the Necessities Corporation. Sales of the pledged stock were authorized and made, and the loan from the bank was finally satisfied. This left to the Necessities Corporation, out of the Borden Company stock, the sum of $56,378.26, and Mr. Brown received that sum from the New York bank on March 17,1930, and claims right to hold the amount here involved for the purpose of paying the Madison Investment Corporation’s loan to the Necessities Corporation, and relieve his property from the mortgage securing that loan, as well as his personal liability as an indorser of the notes evidencing the loan. Two of such notes of $4,000 each matured in March and April, 1930, and were paid out of the fund held by Mr. Brown.
April 28, 1930, receivers were appointed for the General Necessities Corporation, qualified as such, and, on April 30, 1930, demanded of Mr. Brown that he turn over to them, as such receivers, the money in his hands, derived from sale of the Borden Company stock. Mr. Brown refused to do so, and, September 23, 1930, on petition of the receivers, the court ordered Mr. Brown to show cause why he should not be adjudged guilty of contempt of court in not paying the money to the receivers, as previously ordered by the court. Thereupon the Madison Investment Corporation intervened and petitioned the court to adjudge the fund to be held in trust by Mr. Brown under an equitable lien for payment to it, and that it he so ordered paid. Mr. Brown, in answer to the order to show cause, set forth in substance what we have before stated, and admitted all claims set up in the petition of the Madison Corporation. Defendant Brown prosecutes an appeal from a decree ordering Mm to pay the fund, now amounting to $40,608.36, to the receivers of the Necessities Corporation within a specified time or stand adjudged guilty of contempt. The Madison Investment Corporation prosecutes an appeal from the denial of its claim to the fund. The appeals have been consolidated and present the issues of whether the Necessities Corporation segregated the fund and placed it in the hands of Mr. Brown, as trustee, to pay on the corporate obligation to the Madison Corporation, or whether the fund is subject to an equitable lien,in behalf of intervener.
It is contended by appellants that the agreement between Mr. Brown and the Necessities Corporation, to the effect that proceeds from sale of the ice cream plant would be applied in payment of the Madison Investment Corporation loan was established by the evidence, and the trial judge was in error in Ms finding to the contrary. Upon this issue all other questions hinge. No corporate action appears in the minutes of directors’ meetings.
Until Mr. Brown learned of the proceeding for appointment of the receivers, the fund was on deposit in a New York bank to the credit of the Necessities Corporation and its withdrawal check. Upon learning of the proceeding for appointment of the receivers, Mr. Brown, from New York, telephoned the assistant treasurer of the Necessities Corporation to countersign two checks and mail them to him at the New York bank, stating that he wanted to pay the Madison Corporation. Mr. Brown filled out the checks to his own order and drew the money here involved. Up to that time there had been no segre gation of the funds for trust purposes, nor any recognition of such purpose, but rather the contrary.
It would seem that ordinary business acumen should have prompted some more permanent memorial of corporate action than mere memory of individuals. The burden of establishing facts impressing the fund with a trust was upon the claimants of such a result. Such a trust, in opposition to the otherwise clear right of the receivers, is not to be lightly inferred.
Mr. Brown had been liberal in pledging his personal liability in behalf of the corporation by indorsement of its paper and mortgaging his property for the same purpose, and he continued to do so over remonstrances of some of his business associates. Efforts by Mr. Brown to have the Madison Corporation discount the obligation of the Necessities Corporation before maturity, and his declaration that he had the money from sale of the Borden stock with which to make payment, did not establish a trust. The fund was on deposit as money of the corporation, and Mr. Brown could not constitute it a trust fund and make the Madison Corporation the beneficiary by any statements he might make. It required action by the board of directors of the Necessities Corporation to accomplish allocation and severance of this fund and its segregation as a then present devotion thereof to the payment of the obligation of the corporation to the Madison Corporation.
We are satisfied that at directors’ meetings it was talked that, from the proceeds of the sale of the ice cream plant, the mortgage on the plant, taxes, pressing obligations, and the Madison loan could and should be paid, and that Mr. Brown, who dominated the board, should take the Borden stock and pay all such, obligations. But this was no more than ordinary corporate finance management, for such was the purpose in selling the ice cream plant.
The following quotations of testimony are from intervener’s abstract. The secretary of the Necessities Corporation testified that:
“I had a memorandum of this (obligation to be paid out of the money from the Borden stock) along with the other resolutions and I spoke to Mr. Brown about incorporating that in the minutes. I said it would be a good thing to have it there as part of the transaction. He told me, however, to forget about that. That he preferred not to have it in the minutes, so I let it go.”
Harry Z. Brown, a director, testified:
“It was agreed that David Brown was to keep the proceeds of the sale (Borden) in his possession. He was to set aside a certain portion of the stock to take care of the Madison loan. The purpose in setting aside a portion of the stock to pay the loan with was to assure Mr. Brown that the loan would be paid. ’ ’
Mr. Nugent, assistant treasurer and accountant, and also director of the Necessities Corporation, testified:
“After it was figured out what this stock (Borden) would bring, Mr. Brown asked me for a detail of G-eneral Necessities liabilities. I do not recall having a detailed statement of liabilities at the meeting. I do not recall that there was a discussion of how the proceeds of the Borden stock would be used in the retirement of various of the company’s obligations. I do not recall any detail like that. It might have been done without my carrying it in my mind. * * * I do not recall any understanding or agreement whereby the Madison loan was to be repaid out of the proceeds of the sale of the ice cream plant, at any directors’ meeting or outside of any directors’ meeting.”
Harry J. Redwood, also a director, testified:
“I was present in May, 1929, when the $100,000 loan was authorized. There was no arrangement, or agreement respecting that loan by me or anyone in my presence that is not recorded in the minutes of that meeting. * * *
“I recall the meeting of July 5, 1929. There was no discussion at that meeting that the proceeds from the sale of the Borden stock which we were to receive in payment of the ice cream plant was to be set aside or held in trust by David A. Brown for the repayment of himself because of his indorsement of the Madison loan or that the Madison loan was to be paid out of the proceeds of that stock.”
On cross-examination he said:
“I would not undertake on my oath to say that my memory is right about Brown and others not having taken part in a discussion of where this money would go. There were discussions in which I took part as to where this money would go.”
The testimony of Harry C. Haze, also a director, was of like import.
Counsel for the Madison Corporation claim that:
“When respondent (Brown), on behalf of General Necessities Corporation, agreed that intervener’s loan would be repaid out of the proceeds of the contemplated sale of the ice cream plant, and that a portion of such proceeds would be set aside for that purpose, an interest vested in intervener in the proceeds of the sale of the plant. The lien attached to the proceeds when they came into existence. The interest of intervener in the fund was not dependent on performance of the agreement by General Necessities Corporation to set aside a portion of the proceeds.”
Mr. Brown, without corporate authorization, could not fásten an equitable lien upon corporate assets, present or prospective. We find nothing upon which to base an equitable lien. The case appears to have been an instance of a corporation in financial difficulty, and, to meet pressing obligations, sold its ice cream plant in order to obtain money to pay many of its past-due debts and to be prepared to pay as well its debt to the Madison’ Corporation when due. We are not willing to hold that a representation by the president of a corporation that a loan can or will be paid out of avails of a sale of corporate property subjects the avails, or any part thereof, to an equitable lien or constitutes an equitable assignment.
We are unable to find that the money, ordered paid to the receivers by Mr. Brown, was duly segregated by corporate action as a trust fund for payment of the corporate obligation to the Madison Investment Corporation.
Decree in the circuit is affirmed, with costs against both appealing defendants.
McDonald, C. J., and Clark, Potter, Sharpe, North, and Fead, JJ., concurred. Bijtzel, J., did not sit. | [
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North, J.
In these two suits, submitted and considered as one, plaintiffs seek to have defendant restrained from continuing an alleged nuisance. In each case the circuit judge decreed dismissal of the bill of complaint without prejudice to the recovery in suits at law of such damages, if any, as plaintiffs have sustained. Plaintiffs have appealed.
Plaintiffs, upwards of 40 in number, allege that they own and occupy homes located on the easterly side of St. Aubin avenue and on Lumpkin avenue which parallels St. Aubin and is one block to the east, in the city of Hamtramck. St. Aubin avenue extends along the easterly side of defendant’s property, which consists of a large manufacturing site occupied by tracks, buildings, etc., where defendant employed ten or twelve thousand men. Since 1917 defendant has continued to develop and enlarge its manufacturing plant. In 1928 it began to occupy and use a large building it had just previously constructed on the westerly side of St. Aubin avenue opposite the properties of some of the “plaintiffs. In this building, which stands approximately 200 feet west of the center line of St. Aubin avenue, is located defendant’s forge plant, where it operates both day and night powerful steam hammers. In addition to other machines of like character, it here uses five 12,000-pound hammers in forging crank shafts. When in operation each of these machines has a striking force of 120,000 pounds. These five hammers are installed on a concrete mat or foundation 160 feet by 32 feet and 6 feet 6 inches deep. The operation of these huge machines produces noise and vibrations. Defendant, in ways which need not be detailed, attempted to overcome this objectionable feature. Finally, prompted at least in part by a desire to protect neighborhood property, defendant erected another building between its forge plant and St. Aubin avenue. This new building, used by defendant for tempering springs and known as its spring plant, was of extra height and otherwise constructed in such a manner as would protect neighboring property from the noise and vibrations attending operation of defendant’s steam hammers, or at least would reduce these features of defendant’s operations to a minimum. This spring plant is adjacent to and extends along St. Aubin avenue approximately 640 feet, and is 137 feet wide.
Plaintiffs’ original bills of complaint were filed before construction of the defendant’s spring plant; and plaintiffs therein allege that the noise and vibrations caused by the operation of defendant’s steam hammers constitute a nuisance, that it has resulted in serious physical damage to plaintiffs’ buildings, has rendered them untenantable, has impaired the health of the occupants, has deprived them of sleep, and otherwise damaged them both in person and in property. In supplemental bills of complaint filed since the construction of defendants’ spring plant, the plaintiffs allege that defendant operates approximately 22 fuel-oil burning furnaces which throw off monoxide gas, a blue smoke, and noxious odors, and that because of such gas, smoke, and odors, and also because of the noise from these oil burners operating practically 24 hours of each working day, the living conditions in plaintiffs ’ homes are greatly impaired, in that they are not able to open windows for ventilation, to sleep at night, or to dry clothes out of doors.
The voluminous testimony taken in the circuit court is in direct and emphatic conflict as to the extent plaintiffs’ rights are invaded, if at all, in the manner alleged. The circuit judge, who visited the premises while defendant’s plant was in operation, reviewed the testimony carefully and in his opinion filed in the cause clearly intimates that in his judgment plaintiffs’ claims are exaggerations, and that the vibrations of which plaintiffs complain “are not sufficient to amount to a serious inconvenience;” and he also found that plaintiffs had not established their claim of an alleged nuisance resulting from the use of the oil burners in defendant’s spring plant. The circuit judge came to the conclusion that, notwithstanding the various grievances alleged by plaintiffs, they were not entitled to injunctive relief, and that, under the circumstances of the case, if plaintiffs have in fact sustained damage in the manner alleged, they have an adequate remedy in an action at law. On this appeal the issue is whether on the record presented the circuit judge reached the right conclusion.
These further facts are pertinent: At the time plaintiffs filed their bills of complaint and for a number of years prior thereto, the locality in which they resided was far from being a strictly residential district. Instead, it might properly be denominated “a heavy industrial district,” and at least to some degree there existed the attendant disadvantages of smoke, noise, vibrations, and odors. Further, both the Michigan Central Railroad and the Grand Trunk Railroad pass through the locality and make it especially desirable as a location for manufacturing enterprises requiring shipping facilities. These two railways cross at a point commonly known as Milwaukee Junctibn, which is but a short distance from the homes of plaintiffs. As was nat • ural, this district developed industrially rather than as residential. In a comparatively small area, approximately 200,000' men were employed in manufacturing plants there located. Further, it seems undisputed in this record that use of defendant’s steam hammers in the manner in which they were operated is essential to defendant’s business. Plaintiffs do not seek relief on the theory that these machines are improperly installed, carelessly operated, or that conditions could be improved by any reasonable means other than those already resorted to by defendant, except it is urged in behalf of plaintiffs that this phase of defendant’s activities might be located and carried on by defendant at a point more remote from plaintiffs’ dwellings. However, it is self-evident that this would necessitate the abandoning of a portion of defendant’s plant constructed especially for this phase of its work and at a cost of approximately $1,850,000. But aside from this, it does not satisfactorily appear from the record that an attempt to remove its forge plant to some other part of defendant’s manufacturing site would wholly obviate the conditions of which plaintiffs complain, if such conditions are as had as plaintiffs contend. Nor does it appear that such an attempt at removal would not result in merely transferring the alleged nuisance from plaintiffs’ properties to those of others residing in this locality.
For the purpose of decision here, we may assume (without so adjudicating) that plaintiffs’ rights to some extent have been invaded in the manner alleged in the bills of complaint; yet in view of the record presented we are forced to the conclusion that it would he highly inequitable to grant the injunctive relief sought by plaintiffs. The damage to defendant and to its employees would he far greater than that of which plaintiffs complain. They have observed for years the development of defendant’s plant at an expenditure of millions of dollars; and it was self-evident to all that the growth of this and other industrial plants in the locality would continue to render it less and less desirable as a residential district. To summarily interfere with carrying on an essential phase of defendant’s manufacturing activities would be to do an injustice rather than to mete out equity. Granting injunctive relief is within the sound discretion of the court. The exercise of such discretionary power must not be arbitrary. Decision must be based upon the facts of the particular case. A 'strict legal right, if incompatible with the equities of the case, does not necessarily entitle one to equitable redress. Especially is this true if the injured party has a reasonably clear and adequate remedy at law. Avoiding-multiplicity of suits is not a conclusive reason for intervention of equity. In the instant case literal application may well be made of the following statement by Chief Justice Graves, in Fox v. Holcomb, 32 Mich. 494:
“So far as we can judge from the record, a mode of redress so radical would operate against the interests of all parties and eventuate not only in great public inconvenience, but with a pecuniary severity upon the interests of the defendants entirely disproportionate to the nature and extent of the grievance of complainant Fox. Strict legal right, in contradistinction to what is equitable, is not a necessary criterion of equitable redress. A court of equity always endeavors to shape its administration of relief in such way as to avoid oppression or the entailment of consequences of unnecessary rigor.”
The applicability of the rule of granting or withholding equitable relief has been announced and fol lowed repeatedly by this court. Hall v. Rood, 40 Mich. 46 (29 Am. Rep. 528); City of Big Rapids v. Comstock, 65 Mich. 78; Potter v. Railway, 83 Mich. 285 (10 L. R. A. 176); Mackenzie v. Frank M. Pauli Co., 207 Mich. 456 (6 A. L. R. 1305); Monroe Carp Pond Co. v. River Raisin Paper Co., 240 Mich. 279; Adams v. Kalamazoo Ice & Fuel Co., 245 Mich. 261. Many other cognate cases might be cited. The general proposition is thus stated in 1 High on Injunctions (4th Ed.), § 740, p. 703:
“And in granting injunctions against nuisances, as in other cases of relief by injunction, the court may properly be guided by the consideration of the relative convenience and inconvenience of the parties; and if it appears that the benefit resulting to the plaintiff from the granting of the writ will be slight as compared with the injury to the defendant, the relief may be denied and the plaintiff left to the pursuit of his remedy at law.”
In accord with the law as announced in the above cited authorities, on the record here presented, we are fully satisfied that the circuit judge reached the right conclusion.
The decree entered in the circuit court is affirmed, with costs to appellee.
McDonald, C. J., and Clark, Potter, Sharpe, North, and Wiest, JJ., concurred. Butzel, J., did not sit. | [
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Fead, J.
January 12, 1929, garnishee defendant filed disclosure and plaintiff made demand for trial of the statutory issue. May 22, 1930, intervener was appointed receiver of the principal defendant. February 15, 1932, on stipulation, garnishee filed an amended disclosure. In both disclosures garnishee stated that it held a certificate of deposit for $1,000 and a certificate for 20 shares of Bank of Detroit stock, as collateral to indemnify it as surety on an appeal bond of defendant. Judgment for plaintiff in the principal suit was entered March 1, 1932, for $6,947.
The question is, For what property or amount should judgment in garnishment run1? The difficulty arises from the fact that on or about September 13, 1929, defendant desired to withdraw the Bank of Detroit stock from the custody of garnishee; it was done, and a certificate of deposit for $5,500 was substituted therefor as representing the then fair value of the stock. When the writ of garnishment was served, the stock was worth $4,660. After being withdrawn by defendant, it was converted into stock of the Union Guardian Group, which, at the time of the hearing of the garnishee issue, was worth about $840.
The court entered judgment against garnishee for the certificates of $1,000 and $5,500.
Intervener contends that the $5,500 certificate of deposit is not subject to the proceedings because it was not held by the garnishee when the writ was served; that the court should proceed as though garnishee still holds the bank stock; that the liability is to be determined under the practice applicable when the garnishee has possession of the property and refuses to deliver it for levy (3 Comp. Laws 1929, §§ 14875, 14879); and final judgment should be for approximately $840.
The contention requires the trial court not merely to indulge the fiction, but to find as a fact, contrary to the undisputed evidence and the concessions, that garnishee still holds the bank stock, and to pursue a circuitous and vain procedure to charge it with liability. A court cannot be expected to conceive such imagining nor search for ways to enable parties guilty of irregular action to erase their intentional acts and escape their effect. The only excuse for such procedure could be the protection of the rights of an innocent party.
From the time of the service of the writ, the garnishee was liable to the plaintiff to the “amount” (value) of the bank stock, and was forbidden to part with it. 3 Comp. Laws 1929, §§ 14857, 14858. Defendant was entitled to no possession of or benefit from the stock until plaintiff’s claim was satisfied. The effect of the exchange was not to put new money of defendant into the hands of the garnishee after service of writ, but to substitute the certificate of deposit for the stock certificate with the same status in relation to the garnishment. The effect followed the exchange from the agreement of the parties and also from the obligations of the garnishee in the absence of agreement.
Plaintiff is content with the situation, both as to substitution of property and amount. So we need not determine its rights and remedies in case it were dissatisfied with the situation created by defendant and garnishee.
The question here involved does not seem to have been passed upon by the courts, but in Thayer v. Partridge, 47 Vt. 423, the garnishees were charged with the proceeds of property sold by them; the court apparently deeming the liability so obvious as not to require demonstration.
Judgment affirmed, with costs.
McDonald, C. J., and Clark, Potter, Sharpe, North, Wiest, and Btjtzel, JJ., concurred. | [
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] |
Butzel, J.
Eva M. Slater, plaintiff, is the beneficiary of a policy issued by the defendant, the Federal Life Insurance Company, to George Slater, now deceased. The policy was issued for an annual premium of $2. An indemnity provision, on which this action is based, provides:
“For loss of life, * * * sustained by the wrecking or disablement of any horse drawn or motor driven car or motorcycle in which the insured is riding or driving* or by being accidentally thrown therefrom, including accidents causing death or disability sustained under the conditions specified in this part while using or operating farm wagons, mowers, binders, plows, and other farm machinery which is motor driven or horse drawn, the company will pay the sum of......................$2,000.”
Plaintiff claims that assured met his death by being accidentally thrown from a horse-drawn farm wagon which he was using or operating.
At about two o’clock on the afternoon of December 2, 1931, assured was seen driving his team of horses towards a woods not far from his home. The team was hitched to a farm wagon, equipped with a flat rack without sides or ends. The top of this rack was 38 inches from the ground. Assured had raised and trained his team, which was about 15 years old. The horses were extremely docile and quick to start and stop when spoken to, although decedent generally controlled them with the lines. The assured himself was six feet two and one-half inches tall, and evidently able-bodied. On the previous day and also during the forenoon of the day on which assured suffered his fatal injuries, he had been drawing buzz poles, small trees or poles which were to be sawed into smaller pieces for use as firewood. Within an hour after he had driven into the woods, he was heard calling, “ ‘Whoa!’ as if he was in trouble of some kind. ’ ’ His brother-in-law, working about 40 rods away, heard him call, but made no attempt to ascertain what the trouble was. About 3 o’clock he was seen driving out of the woods on the same wagon, which was intact except that a small sliver had been broken off the right side of the flat rack. The wood indicated that the break had been recent, and the testimony shows that it had not been noticed previous to the accident. A search at the scene of the accident did not reveal the missing sliver, and it has never been found. No one was able to testify whether the break had occurred the day of the accident or previous thereto. The wagon was not otherwise wrecked or disabled.
A neighbor who saw assured driving out of the woods and assisted him to his home saw that he was in bad condition and unable to speak. His left eye was swollen and his face bleeding. He had a very severe skull fracture on the left side of his head. He died two days later without communicating to anyone the manner in which he had sustained his injuries. There were no eyewitnesses to the accident. Plaintiff claims that assured sustained the skull fracture by being thrown from the wagon.
The following day a number of friends of deceased went to the scene of the accident and examined the premises. One of them testified that he followed the wagon tracks into the woods to the point at which they stopped. They showed that the wagon had been headed toward the northwest and backed up close to a pole of dead black ash. This pole was about 30 feet long, six inches at the butt and about three inches at the top, and very crooked. It was found lying on the ground to the right or east of the wagon track. This pole apparently had broken from its stump some time previous to the accident and had lodged in the crotch of an elm tree located some distance to the northwest. The butt of the pole had embedded itself some 8 or 10 inches in the soft earth, and the furrow in the ground indicated that the butt end must have plowed through the mucky soil for a distance of 12 or 15 feet before striking the roots which evidently halted it in its course. Marks near the butt of the pole indicated that a chain had been attached thereto, and blood on the rear axle of the wagon showed that the deceased must have unhooked the chain from the axle after being struck. Blood and hair were also found on the pole about six feet from the top, and it is evident that the pole fell in an unexpected manner and struck Slater on the head.
Contact of the wheels with a tree stump close to the right side of the wagon, or the sudden encounter of the heavy roots with the butt of the pole, or both, may have brought the wagon to a sudden stop and thrown Slater from his wagon, projecting the pole upon him as he fell feet first. The trial judge adopted this theory, and rendered judgment in favor of the plaintiff.
It is claimed by appellee that the footprints indicate that deceased was thrown from the wagon and the pole struck him as he lit on his feet. Slater was hit on the left frontal portion of his skull. The pole was found to the right of the wagon and the most reasonable inference is that the pole must have swept from right to left towards the wagon. If the deceased was injured while on the wagon or immediately after he landed on the ground after being thrown, he would have been hit on the right side of the head instead of the left, unless we assume that, instead of facing his team, he was turned toward the rear of his wagon. This would be an unnatural inference. If the blow had come from the left, as assured was driving, it is claimed that there would have been signs where the pole hit the wagon, or it might very possibly have fallen upon him.
The pole was found two to six feet from the wagon track, and assured appears to have fallen close to but to the right of the pole, away from the wagon. How the assured was able to unfasten the chain and drive his team back .to the road, after suffering his fatal injuries, is not disclosed by the record and is shrouded in mystery. It may be that a blood clot did not form at once. He did retain his mental faculties sufficiently to enable him to start for home, a docile team doing the rest.
Other theories as to how the accident occurred may be deduced from the facts. It seems quite probable, assuming the wagon had been halted by the stump or roots, that the footprints where deceased landed were caused by his jumping from the wagon, rather than by his being thrown therefrom. It seems also plausible that the decedent may have been directing his team from the ground after the butt of the pole became caught. The testimony shows that the team was so docile that Slater could direct them by appropriate words.
There are at least four possible explanations of the accident: The assured might have been on the ground directing the team when the accident occurred ; he might have been hit while on the wagon, and thus injured solely by the blow, and not as a result of being thrown from the wagon; he might have jumped from the wagon voluntarily and landed on his feet just as the descending pole contacted with his head; or he might have been injured in the manner found by the trial judge. A careful study of the record leaves us absolutely uncertain as to what may have been the actual cause of the accident, and leads us to the conclusion that the judgment was based solely on conjecture. We believe that the inference that deceased did not suffer his injuries by being thrown from the wagon is at least equally as tenable as that advanced by the trial judg-e. Unaided by the testimony of eyewitnesses or even helpful circumstantial evidence, his conclusion is the result of pure conjecture, and the evidence will not sustain the judgment. Manning v. Railway Co., 105 Mich. 260; see, also, Knapp v. Railway Co., 114 Mich. 199. Under the circumstances, we must conclude that the evidence does not show that assured met his death from or by reason of any cause insured against by the policy.
The judgment of the lower court is reversed, with costs, without new trial, and judgment entered for the defendant.
McDonald, O. J., and Clark, Potter, Sharpe, North, Fead, and Wiest, JJ., concurred. | [
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Clark, J.
In this review as upon certiorari of an award of the commission of department of labor and industry, the question is, was there an accidental personal injury arising out of and in the course of the employment 1 Plaintiff, a saleslady of defendant employer, handled a shipment of low-priced, dyed furs, having a had odor. Shortly thereafter a rash broke ont on different parts of her body. Plaintiff testified of the history and development of her ailment and of probable source of irritation. Physicians who examined and treated her testified from their own observations and knowledge and from the history supplied by plaintiff that in their opinion the irritation was caused by handling the furs. Other common causes of such an irritation were named and eliminated, leaving the reasonable inference of cause as stated, and this was the inference of the commission, a finding of fact, supported by evidence and conclusive on this court. See Dove v. Alpena Hide & Leather Co., 198 Mich. 132; Frankamp v. Fordney Hotel Co., 222 Mich. 525.
The contention of occupational disease calls for no discussion on this record.
Affirmed.
McDonald, C. J., and Potter, Sharpe, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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North, J.
On July 13, 1931, a decree of dissolution of the Chaffee Brothers Furniture Company was entered in the circuit court of Kent county. Receivers were appointed. At that time Chaffee Brothers Furniture Company was the owner in fee of a parcel of real estate subject to- a $2,000 mortgage. The Otterbein Home, a division of the Church of the United Brethren of Dayton, Ohio, was the assignee of the mortgagee. There being default, foreclosure proceedings by advertisement were instituted under the statute (3 Comp. Laws 1929, § 14427) after the receivers went into possession and began using the mortgaged premises. The foreclo sure sale was made by the sheriff March 19,1932, the mortgagee becoming the purchaser. Pour months later the receivers filed the petition herein, by which they asked that the foreclosure proceeding's be set aside and that the sheriff’s deed given upon foreclosure be decreed “void and of no effect.” The relief sought was granted on the ground that the attempted statutory foreclosure was null and void for the reason that it was consummated without the consent of the court in which the receivership was pending. The Otterbein Home, as purchaser, has appealed.
The question presented is whether this statutory foreclosure is null and void because permission to institute the foreclosure proceedings was not first obtained from the court in which the receivership was pending. On this question there is lack of harmony in decisions of various jurisdictions. In support of the rule that it is not necessary to obtain the consent of the receivership court is the case of McKnight v. Brozich, 164 Minn. 90 (204 N. W. 917, 43 A. L. R. 1352, and note). The opinion in the foreg'oing case contains numerous citations of authorities, also a somewhat detailed review of Wiswall v. Sampson, 14 How. (55 U. S.) 52, which case has many times been referred to- as the leading authority holding that consent of the receivership court is a necessary prerequisite. However, in Michigan we are already committed to the view that, when a receiver has taken possession of property, such possession is that of the court itself; and no proceedings can be taken which attacks^or challenges such possession without leave first obtained. Careful consideration is given to this phase of the law in Justice Long’s opinion, found in Campau v. Detroit Driving Club, 130 Mich. 417, where many decisions are cited and quoted somewhat at length. In an earlier decision of this court it is said:
“It is a general rule that property in custody of the law is not subject to attachment or garnishment. The law does not permit one court to assume control over the representative of another court, or the property confided to his charge. By this it is not meant that personal remedies against the individual may not be sought, but that any proceeding in the nature of an action in rem, whereby it is sought to reach the property which another court has taken possession of, is forbidden.” Hudson v. Saginaw Circuit Judge, 114 Mich. 116 (47 L. R. A. 345, 68 Am. St. Rep. 465).
It will be noted that many decisions, especially such as those involving attempts to attach or garnishee property in the receiver’s possession, arise out of litigation in which it is sought to gain a preference in the receivership property as against rights of other creditors of the same class. Obviously such preference should not be permitted. But it is urged that the rule of such cases should not prevent one who has an unquestioned paramount lien from asserting such right. The answer is that such a lien-holder is not deprived of his priority of claim or of his security by the requirement that he shall not enforce it without first obtaining* consent of the receivership court. This requirement is a matter of procedure; and has to do with the orderly management of receiverships. The holding that, under certain conditions; a lien claimant may not proceed to enforce his claim, as in cases of receivership or bankruptcy, without complying with or being subjected to certain .procedural regulations, is no different than requiring service of process or publication of a notice of a foreclosure sale, etc. And for many years it has been the rule in this State that the consent of the court in which the receivership is pending is necessary to a valid proceeding to enforce a lien.
“It has been held that property in the hands of a receiver is still subject to taxation, and it is competent to levy taxes against it; that the levy of taxes upon property in the hands of a receiver creates a lien, but that the taxes cannot be collected by a sale of the property under the tax laws; they can only be collected by the filing of an intervening petition praying for their payment. In re Tyler, 149 U. S. 164 (13 Sup. Ct. 785). The above case was cited and followed by the United States court for the district of South Dakota in Ledoux v. LaBee, 83 Fed. 761, and by the supreme court of Georgia in Dysart v. Brown, 100 Ga. 1 (26 S. E. 767). In Virginia, T. & C. Steel & Iron Co. v. Bristol Land Co., 88 Fed. 134, tax sales to the State of real estate in the hands of a receiver were held void.” Campau v. Detroit Driving Club, supra.
In Prather Engineering Co. v. Railway, 152 Mich. 582, the bill of complaint was filed to foreclose a mechanic’s lien, and in affirming a decree dismissing the bill it was said:
“It has been held * * * that a receiver cannot be sued without leave of the appointing court (People, ex rel. Tremper, v. Brooks, 40 Mich. 333 [29 Am. Rep. 534]; Citizens’ Savings Bank v. Ingham Circuit Judge, 98 Mich. 173). Whether leave to make the receiver a party is jurisdictional has never been expressly determined in this State.”
In this connection, see, also, In re Guaranty Indemnity Co., 256 Mich. 671.
Appellant seeks to avoid the rule adhered to in the foregoing cases by asserting that the right to foreclosure by advertisement is one given by the legisla ture, and therefore it cannot be abrogated or impaired by the court. But it must be assumed that, in providing statutory foreclosure, the legislature was fully cognizant of the inherent power of the court to intervene, as in a receivership, whenever the rights of others become involved. The mere fact that the statutory foreclosure is not strictly a proceeding in court does not immunize it from judicial supervision in proper cases. The result of such foreclosure if carried to an effective conclusion would be in the instant case to dispossess the receiver of property without the consent of the appointing court. But that is the very thing forbidden by law, on the ground that it would work an indignity to the authority of the court and prevent orderly procedure in the receivership.
Nor is there merit to appellant’s contention that requiring permission to foreclose a mortgage is an impairment of a contractual right. In cases involving mortgage foreclosures or foreclosures of other vested liens, the contract rights of the lienholders to forthwith enforce their liens are no more sacred or important than the right of ordinary creditors to institute suit against the debtor, to attach his propery, to garnishee, or perhaps to institute suit to set aside' a sale or other transaction on the ground of fraud. But each of these rights is held in abeyance during the receivership in so far as they affect the receiver’s possession of property, unless the consent of the court is obtained. Receiverships are designed to accomplish in an orderly manner under supervision of the court the maximum degree of benefits to all concerned. In their operation they may effectuate a moratorium as to certain parties; but the matter of orderly procedure imposed is not an impairment of contractual rights. The lienholder is not deprived of his lien; but be may not proceed in total disregard of tbe receivership court.
In tbe instant case tbe trial court saw fit to decree tbe statutory mortgage sale and tbe sheriff’s deed “void and of no effect.” This bolding was on tbe ground that prosecuting tbe statutory foreclosure without the court’s consent against tbe property “in tbe immediate possession and use of tbe receivers,” when it was fully known to tbe mortgagee that tbe receivership was pending, was contempt of court. That tbe prosecution of tbe foreclosure was a contempt is clear, and we are not disposed to interfere with tbe court’s decree voiding tbe foreclosure sale. However, decision here is not to be construed as bolding that sales so made are necessarily void rather than voidable, or that tbe rights of tbe receiver and tbe dignity of the court could not have been fully sustained by enjoining tbe purchaser at tbe foreclosure sale from instituting proceedings to dispossess tbe receiver. These and other details, like tbe matter- of granting permission to institute tbe suit, are to a large degree within tbe discretion of tbe court in which tbe receivership is pending.
Tbe decree of tbe circuit court is affirmed, with costs to appellee.
McDonald, C. J., and Clark, Potter, Sharpe, Fead, Wiest, and Btitzel, JJ., concurred. | [
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Butzel, J.
Plaintiff Frank Kelley had been employed for more than three and one-half years by defendants Ova D. Brown and Clarence C. Brown, copartners doing business as the Brown Ice & Coal Company of Benton Harbor, Michigan. On July 9, 1930, he and his son Zell were directed to fill the ice coolers in two meat markets. In order to fill coolers of this type, it was generally necessary to take along a small portable step-ladder or steps, so as to reach the opening in the upper part of the cooler, through which the ice was shoved. Defendants had two ladders for this purpose, and defendants’, foreman directed plaintiff to take the larger one, the only one not then in use. This ladder was of a portable type, about 4 feet in height, made of 1 inch boards fastened together with nails, and had six steps or treads from 20 inches to 2 feet long and 10 inches wide. It tapered towards the top, on which there was a platform about 2 feet square. It weighed approximately 75 pounds. The treads were fastened with braces and nails but not with bolts.
Plaintiff and his son proceeded with the load of ice to Grand Crossing Market, where, after placing the ladder against the cooler, plaintiff ascended, entered the cooler, and then received and piled up the ice as Zell took it from the truck and brought it up the ladder to the opening. After Zell had made 11 or 12 trips up the steps, each time carrying heavy cakes of ice, plaintiff left the cooler to assist his son. He picked up a heavy block of ice, weighing approximately 100 pounds, and proceeded up the steps.
Plaintiff was not able to testify at the trial. His son stated that plaintiff had no difficulty in going up the steps, but that when he had one foot on the steps near the top and raised his other foot to reach the platform—
“the cake of ice touched the ceiling and during the time, not catching his balance and the ladder weaving, lie lost his balance and fell back. I couldn’t estimate the time between the time of his cake of ice touching the ceiling and before he fell, but it wasn’t very long. I suppose when he touched the ceiling it might have jarred him somewhat and jarred the steps, too. The steps didn’t break with him, when he touched the ceiling. The steps would weave both ways, sideways. At that time they weaved probably an inch that way. They didn’t go any other way. ”
It is claimed that plaintiff fell on his head, and that this caused his subsequent serious condition. There was no wound, gash, or mark showing a head injury. The son continued to use the steps in completing the delivery of the order, and went up and down the ladder eight or nine times after plaintiff had fallen. Plaintiff accompanied his son in delivering another order of ice, but did not do any work. According to the son’s testimony, on their return to defendants’ place of business, plaintiff complained of pain, but made no report of the injury to defendants. After continuing to work for several days, he became very ill. Paralysis set in, and he was in very bad condition at the time of the trial.
As a verdict was directed for defendants, we must disregard all testimony showing that plaintiff’s injury may have been due to other causes, as is intimated. Inasmuch as defendants did not elect to come under the workmen’s compensation act (2 Comp. Laws 1929, § 8407 et seq.), the defenses of 4 4 assumed risk ’ ’ and 4 4 contributory negligence ’ ’ are not open to them. This does not, however, relieve the plaintiff from the burden of showing negligence on the part of defendants.
We agree with the circuit judge that there was no showing sufficient to submit the case to the jury. It is nowhere shown that defendants were negligent in any respect. _ It is claimed that the steps of the ladder became loose at times, and that it was necessary for the employees to make them secure by driving in the nails. The testimony indicates that the steps were in their ordinary condition the day of the accident. Plaintiff’s son used them 11 or 12 times in carrying heavy loads up to the cooler. Plaintiff himself made one trip up and down the steps before he was hurt. His son made 8 or 9 trips after plaintiff’s fall. It is admitted that plaintiff may have lost his balance, or at least partially so, by striking the block of ice against the ceiling. It is claimed, however, that one of the steps “weaved” or wobbled to a slight extent after plaintiff’s cake of ice hit the ceiling, and in that manner he may have been thrown off his balance by this sway.
It is certain, nevertheless, that there was no break in the steps whatsoever, and if they were slightly out of repair, they could have been readily repaired by plaintiff and his son. The testimony shows they had been repaired in the past by knocking* in the nails with an ice tong*. There is no testimony to show that the defective condition of the steps was ever brought to the attention of defendants. One of plaintiff’s witnesses, on being called, contradicted his former testimony and claimed that he had mentioned the condition of the steps to plaintiff’s foreman at some time previous to the accident. However, there is uncontradicted testimony that the steps were repaired at various times.
A small portable ladder or steps falls within the “small tools or implements” exception to the rule requiring the master to inspect and provide his employees with safe tools, etc., with which to work. The cases of Menere v. Copper Range Consolidated Co., 169 Mich. 367, and Nichols v. Railroad Co., 145 Mich. 643, are referred to, to show that a ladder is not a tool of the kind that comes within the “small tools and implements” exception. These cases involved long, stationary ladders, 16 to 35 feet in length and permanently fixed, which employees had to climb or descend regularly in the course of their employment. They are clearly .outside of the “simple tool” classification, and the cases are not in point.
In the case of Sheltrown v. Railroad Co., 245 Mich. 58, Mr. Justice Sharpe, speaking for the court, commented upon the fact that the doctrine that a master must furnish his servant with reasonably safe machinery and appliances to perform the work required of him, and also keep them in safe condition by inspection from time to time and by ordinary care and diligence in making repairs, is subject to an exception in the case of simple tools and appliances. Af ter referring to the cases of Anderson v. Railroad Co., 107 Mich. 591 (16 Am. Neg. Cas. 98); Wachsmuth v. Shaw Electric Crane Co., 118 Mich. 275, 279, and Toth v. Osceola Mining Co., 180 Mich. 274, he cites with approval the statement made in Lynn v. Glucose Sugar Refining Co., 128 Iowa, 501 (104 N. W. 577), in which the court said:
■ “It is only machinery and appliances which are recognized as in their nature dangerous to employees using them, or working in proximity to them, as to which the employer owes a duty to the employee of looking out for his safety.”
Mr. Justice Sharpe further states:
‘ ‘ The decisions of other courts have been collected in the notes to 13 L. R. A. (N. S.) 679; 40 L. R. A. (N. S.) 832; 51 L. R. A. (N. S.) 337; and L. R. A. 1918D, 1141. What is, or is not, a simple tool under the rule stated, and the duty to inspect if it is not, depends much upon the use to which” it is to be put by the employee. His age, his incapacity to appreciate danger, the nature of the employment, his familiarity with the work to be done, these and many other things may be considered in determining the obligation resting on the employer to make inspection. His nonliability in such cases rests upon the assumption that the employee is in as good, if not better, position to observe the defect as the employer. Meyer v. Ladewig, 130 Wis. 566 (110 N. W. 419, 13 L. R. A. [N. S.] 684). The test depends, not only on the simplicity of construction, but also somewhat on whether the tool is subjected to any other stress than the muscular effort of the person using it.”
Notwithstanding some rulings in a few cases to the contrary, the great weight of authority is to the effect that a small portable stepladder is á simple tool or appliance. See Smith v. Green Fuel Economizer Co., 123 App. Div. 672 (108 N. Y. Supp. 45); Kelly v. National Starch Co., 142 App. Div. 286 (126 N. Y. Supp. 979); Shute v. City of New York, 149 App. Div. 758 (134 N. Y. Supp. 111); Blundell v. William A. Miller Elevator Manfg. Co., 189 Mo. 552 (88 S. W. 103); Sivley v. Nixon Mining Drill Co., 128 Tenn. 675 (164 S. W. 772, 51 L. R. A. [N. S.] 337); Philip Carey Roofing & Manfg. Co. v. Black, 129 Tenn. 30 (164 S. W. 1183, 51 L. R. A. [N. S.] 340); Collins v. Western Electric Co., 178 Ill. App. 23; Nosal v. International Harvester Co., 187 Ill. App. 411. Contra, Puza v. C. Hennecke Co., 158 Wis. 482 (149 N. W. 223); Laurel Mills v. Ward, 134 Miss. 447 (99 South. 11); Goebel v. Railway Co. (Mo. App.), 241 S. W. 665.
The trial court was correct in finding that there was no negligence shown on the part of defendants. The judgment of the lower court is affirmed, with costs to defendants.
McDonald, C. J., and Clark, Potter, Sharpe, North, Read, and Wiest, JJ., concurred. | [
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] |
Wiest, J.
The bill herein was filed to foreclose a real estate mortgage for $3,000, given by defendants to plaintiff in 1923. Defendant Ruth Smith appeared and asserted that $1,500 was paid on the mortgage December 18, 1926, and produced an alleged receipt to such effect, which she claimed to have found among her husband’s papers after their separation. Whether such a payment was made was the issue in the circuit court. The circuit judge .was unable to adjudge that the alleged payment was made, and defendant Ruth Smith reviews by appeal.
At the time the mortgage was given, defendants were husband and wife, but later they separated, Ruth filed a bill for divorce, and that case was heard just before this case, and is here for review by appeal of George Smith. George Smith is plaintiff’s son. Payment, whether in whole or in part, is an affirmative defense. Court Rule No. 23 (1931). It must not only be pleaded (Loomis v. Bound, 251 Mich. 173), but the burden rests upon defendant to prove it. LaPree v. DePew’s Estate, 219 Mich. 612. An authentic receipt is only prima facie evidence (Brusseau v. Potter’s Estate, 217 Mich. 165), and an unauthenticated receipt is no evidence at all. Was authenticity of the receipt established? Defendant Ruth Smith knew nothing about it beyond finding it among her husband’s papers. Plaintiff denied giving it or receiving such payment. Defendant George Smith was a witness, but his testimony was not helpful to either party.
Upon consideration of all the evidence, we are unable to find that the alleged payment was made.
The decree is affirmed, with costs.
McDonald, C. J., and Clark, Potter, Sharpe, North, Pead, and Butzel, JJ., concurred. | [
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Butzel, J.
The will of Charles Warmbier contains the following provisions:
“I hereby direct my executor to procure for Charlotte Warmbier and Betty Warmbier, daughters of my nephew, Charles Warmbier, and also for Pansy Thon, daughter of my niece, Elsie Thon Schulz, or for such of them as are living at the time of my decease, an annuity in the gross amount of $1,000 for each of said living beneficiaries, said annuity to be paid in monthly instalments over a period of five years, to be used, preferably, for the education of said annuitants. * * * And all duties and transfer charges and expenses which may be levied or incurred in connection with any annuities, bequests, legacies, or devises, contained in this, my will, shall be paid out of the corpus of my estate by my executor. ’ ’
The sole question involved in the present case is whether the quoted clause provides for an annual payment of $1,000 a year to each of the annuitants during each year over the five-year period, or whether each is to receive the total sum of $1,000, payable in monthly instalments over a period of five years. Were not the word “annuity” limited by the words “in the gross amount of $1,000,” appellants would be correct in invoking the rule that extrinsic evidence may not be introduced where the meaning of the words is so plain that no uncertainty arises. However, where there is any obscurity or ambiguity in the language, as in the present instance, so that the intent of the testator becomes doubtful, it is proper to permit extrinsic evidence to discover the testator’s intent. Sondheim v. Fechenbach, 137 Mich. 384; Van Gallow v. Brandt, 168 Mich. 642; Holmes v. Connell’s Estate, 207 Mich. 663. The testimony leaves no doubt whatsoever but that the testator only intended to give each of the annuitants $1,000, payable over tbe term of five years. He had made a previous will, giving each of them the sum of $1,000, but he feared that they might spend this sum unwisely if it was given to them at one time. He did not desire that the amount of each legacy be increased in the present will, but that he did wish to have it paid in monthly instalments over a period of five years, is clear. The unfortunate language of those who assisted in the preparation of the will has led to the difficulty in interpretation. The trial judge correctly entered a judgment directing that the executors procure an annuity contract for the total sum of $1,000 for each of the beneficiaries named in the paragraph, such sum to be- paid over a period of five years in monthly payments.
Judgment is affirmed, with costs to appellees.
McDonald, C. J., and Clark, Potter, Sharpe, North, Pead, and Wiest, JJ., concurred. | [
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McDonald, C. J.
(for reversal). This suit was brought to recover a balance of $4,415.70, due on a contract for furnishing structural steel in the erection of a private building in the city of Detroit. The plaintiff’s contract was with R. S. Knapp Company, the principal contractor. The Inter-City Trucking Service, Inc., is the owner of the building. The Fidelity & Deposit Company of Maryland is surety on the principal contractor’s bond to the owner, who was named obligee. This suit is against the principal contractor and the surety. The issue was tried by the court without a jury. Judgment for cause was rendered against the contractor and for no cause as to the surety. The plaintiff has appealed.
The conditions of the bond are as follows:
“Now therefore, the condition of this obligation is such that if the principal shall faithfully perform the contract on his part, and satisfy all claims and demands, incurred for the same, and shall fully indemnify and save harmless the owner from all cost and damage which he may suffer by reason of failure so to do, and shall fully reimburse and repay the owner all outlay and expense which the owner may incur in making good any such default, and shall pay all persons who have contracts directly with the principal for labor or materials, then this obligation shall be null and void; otherwise it shall remain in full force and effect.”
The plaintiff bases its right to recover on the last condition of the bond, which provides that the principal shall pay all persons who have contracts directly with him for labor and materials. It contends that, though not expressly referred to by name as an obligee in the bond, the bond was given for its benefit as well as for the benefit of the owner, and that the language of the last condition imports a direct obligation on the part of the surety to pay for labor and materials. On these facts the plaintiff claims the right to maintain a suit in its own name against the surety.
The defendant contends that the only promise of the surety was to the obligee or owner; that the bond was not made for the benefit of the plaintiff; that he is not in privity with the surety, but merely a third party, a stranger to the contract, and therefore cannot maintain this action against the surety.
The early common law denied to a third party the right to maintain an action on a contract made for his benefit; but in modern American jurisprudence such right in proper circumstances is definitely recognized by an overwhelming weight of authority. The evolution of the law on the subject and its modern status is discussed at length in the annotation following the reported case of Fidelity & Deposit Co. v. Rainer (220 Ala. 262 [125 South. 55]), in 77 A. L. R. 13-20. On page 53, under the head “Bond of private contractor, ” it is said:
“The great weight of authority establishes the general rule that a person furnishing materials or labor may recover on a building contractor’s bond to the owner, where it contains a condition for their benefit and is intended for their protection; although the owner is the only obligee named in the bond, and there is no express provision that it shall inure to the benefit of laborers or materialmen, or that they may avail themselves of the security thereof.” Many cases are cited in support of the text on pages 54 and 55.
The general doctrine as to the right of a third party to enforce, a contract made for his benefit is stated in 13 O. J., beginning on pages 705, 709, 711, as follows:
“Section 815. In most of the States the English doctrine that where a person makes a promise to another for the benefit of a third person the latter cannot maintain an action on it is not recognized to the full extent, but it is held, subject to the qualifications hereafter stated, that the action may be maintained. This is now the prevailing doctrine in the United States.”
“Section 817. In many of the cases the doctrine is stated broadly that a person may maintain an action on a promise made for his benefit, although not a party to the contract; but this statement of the doctrine is too broad. By the weight of authority the action cannot be maintained merely because the third person will be incidentally benefited by performance of the contract; he must be a party to the consideration, or the contract must have been entered into for his benefit, and he must have some legal or equitable interest in its performance.”
“If the person for whose benefit a contract is made has either a legal or equitable interest in the performance of the contract, he need not necessarily be privy to the consideration. The name of the person to be benefited by the contract need not be given, if he is otherwise sufficiently described or designated. The fact that the particular person who is to benefit from the promise is not known when the promise is made is immaterial. He may be one of a class of persons if the class is sufficiently described or designated. And the fact that the person to whose benefit a promise may inure is uncertain at the time it is made, and that it is dependent on a contingency, will not deprive the person who afterward establishes his claim to be the beneficiary of the promise of the right to recover upon it. ’ ’
The precise question involved in the instant case seems never to have been before the Supreme Court of Michigan, but the right in general of a third party to enforce a contract made for his benefit was considered iii Claxton v. Margolis, 248 Mich. 199. The rule there stated by Mr. Justice Sharpe is that a third person may enforce a contract made for his benefit if there is “some obligation or dnty resting upon the promisor to the third person, giving him a legal or equitable claim to the benefit of the promise.”
There is no doubt about the law. The question is whether it is applicable to the terms of the bond in question.
It will be noted that the bond contains five conditions. The first four are plainly obligations to the owner only. They are sufficient in themselves to indemnify him against every conceivable loss. It was not necessary to add the fifth condition for his protection, so it must have been intended for the benefit of the third persons, labor or materialmen, who had dealings with the principal contractor, for they are the persons mentioned. Its language imports that it was for their benefit. “And shall pay all persons who have contracts directly with the principal for labor or materials.”
The plaintiff had a contract directly with the principal, and this condition in the bond was a guaranty by the surety that the principal would perform. The promise of the surety was a direct benefit to the plaintiff, and was evidently intended to be such, for it was made after the owner had been fully provided for. As to the owner, it was mere surplusage, for it added nothing to the promises in the preceding portion of the bond, all of which were for his benefit. If the fifth condition had been entirely omitted from the bond, the owner would have been as fully indemnified as he is with it in the bond. This condition is not surplusage or an accidental insertion by the party who drafted the bond. The bond is a standard form adopted by the American Institute of Architects and approved by the National Contractors’ Organization. We may assume that it contains no sur plusage or meaningless matter. It was put in* the bond for a purpose, and the purpose is obvious from the plain language used. It was intended as a guaranty by the surety that all persons dealing directly with the principal contractor would be paid for the materials they furnished or the labor they performed. It was a proinise for their direct benefit. It was a guaranty for the benefit of a class, and plaintiff came within that class.
We think a proper construction of the bond shows that the intention of the parties as expressed in the fifth condition was not only to indemnify the owner but to guarantee payment to materialmen who dealt directly with the principal contractor.
Contractors’ bonds, identically like this one, were similarly construed in Byram Lumber & Supply Co. v. Page, 109 Conn. 256 (146 Atl. 293); Hartford Accident & Indemnity Co. v. Knox Net & Twine Co., 150 Md. 40 (132 Atl. 261); and on rehearing in Fidelity & Deposit Co. v. Rainer, 220 Ala. 262 (125 South. 55), reported also in 77 A. L. R. 13.
The plaintiff was a real party in interest, and had a right to bring suit in its own name. Judicature act (3 Comp. Laws 1929, § 14010).
“The provision of the judicature act referred to evidently intended to enlarge the remedy of a beneficiary in contracts so as to enable him to enforce his beneficial interest directly by suit in Ms own name.” Smith v. Oosting, 230 Mich. 1.
See, also, Getchell & Martin Lumber Co. v. Peterson & Sampson, 124 Iowa, 599 (100 N. W. 550).
Other questions not' discussed are considered as having no merit or are settled in cases cited.
The judgment should be reversed, and the cause remanded for entry of judgment against the surety for the undisputed balance on plaintiff’s contract. The plaintiff should have costs. ■
Clark, Sharpe, and Wiest, JJ., concurred with McDonald, C. J.
Fead, J.
(for affirmance). In my opinion the judgment must be affirmed. The bond was not made for the benefit of plaintiff, nor was there any “obligation or duty resting upon the promisor to the third person, giving him a legal or equitable claim to the benefit of the promise.” Claxton v. Margolis, 248 Mich. 199.
The bond provides that the principal and surety “are held and firmly bound unto Inter-City Trucking Service, Incorporated.” It contains no provision for enforcement by anyone else. It was given for the benefit of the owner, to insure performance of the contract at the agreed cost. The instrument must be construed as a whole and in the light of the fact that persons furnishing labor and materials to the building have protection by way of mechanic’s lien. If all persons who could have “claims and demands incurred for the same” may sue on the bond, their combined actions could exhaust it and leave the owner remediless. It is not a reasonable construction of the bond that it was intended to give contractors, materialmen, and laborers security, in addition to the right of lien, which could impair the purpose of the bond to protect the owner.
The contractor owed no legal or equitable duty or obligation to plaintiff in connection with the bond. Its obligation to plaintiff arose from and was measured by a separate and distinct contract between them. The security of plaintiff for payment rests upon the provisions of such separate contract together with the lien law.
Potter, North, and Btjtzel, JJ., concurred with Fead, J. | [
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] |
Potter, J.
Plaintiffs filed their bill of complaint against defendants to set aside a deed from F. Roy Holmes and Cora A. Holmes, his wife, to Basil Harter and Ralph Harter, and an oil lease from Basil E. Harter and Hazel Harter his wife, and Ralph D. Harter to the Pnre Oil Company; for a release of the interest of the Pnre Oil Company of its claimed interest in the lands in question under its lease; to cancel and set aside its lease, and for other relief. Defendants answered, denying all the material allegations of plaintiffs’ bill, alleging title, and rights in the Pure Oil Company under its lease, claimed to be valid; denying plaintiffs were entitled to the whole or any part of the relief prayed. Prom a conditional decree for plaintiffs, defendants appeal, and plaintiffs take a cross-appeal.
The controversy concerns the northeast quarter of the southwest quarter of section 6, township 14 north, range 2 west, in Midland county. Plaintiffs claim they are the owners of the regular or government chain of title to the real estate in question; defendants did not prove title by adverse possession, nor by virtue of State tax deeds passing under the sale of the lands for taxes and proceedings thereunder; and plaintiffs are not estopped to claim under the original government chain of title. The trial court imposed, as a condition to a decree for plaintiffs, they should repay the amount of the taxes on the premises paid by the adverse claimants, and decree was rendered for plaintiffs subject to this condition. Defendants claim plaintiffs’ right of action was barred by the statute of limitations (3 Comp. Laws 1929, § 13964), that they have title to the premises by adverse possession, and plaintiffs are estopped from asserting title against defendants.
Mahlon S. Miller, being the owner of this land, died August 11, 1902, leaving by his first wife five children, Celesta Miller Bailey, Elizabeth Miller Smith, Mary Miller Garner, Lemuel Miller, and Sylvester Miller; and by his second wife two children, Earl Miller and Myrtle Miller Kath. Some of these children died prior to the commencement of this suit. There is no dispute as to the heirship of their descendants. Plaintiffs claim title because they hold in privity with the title of Mahlon S. Miller, deceased. Defendants base their title on a tax deed from the State to P. Roy Holmes, dated October 19, 1907, recorded December 2, 1907, made in pursuance of the general tax law of 1897, as amended. Holmes deeded the property to Basil Harter and Ralph Harter May 9,1914, which deed was recorded June 5,, 1914. The rights of defendants being based upon this tax deed, it was incumbent upon them to show compliance with the tax law.
Defendants proved service of the tax notice prescribed by statute upon Mary Garner, Lemuel Miller, Elizabeth Miller Smith, Sylvester Miller, Earl Miller, and Joseph Evaland, as guardian of Myrtle Miller, and service by registered letter upon Robert S. Mitchell, mortgagee. No proof that service was made upon Celesta M. Bailey or upon her personal representative or heirs appears.
(1) Act No. 229, Pub. Acts 1897 (see 1 Comp. Laws 1929, § 3535), prohibited the issuance of writs of assistance or other process to purchasers under tax deed of land to place them in possession thereof until six months after the return of service of the tax deed notice provided therein. If the owner of the. original title after such service redeemed therefrom, he became entitled to a reconveyance in pursuance of the statute. This act was amended by Act No. 204, Pub. Acts 1899, to provide, in case the owner of the interest in the land was dead, for service upon the personal representative of the deceased person and upon his heirs. At the death of the ancestor, the title to real estate descends to heirs, in the absence of other disposition of the real estate, and service must have been made upon the heirs of Celesta Miller Bailey. The effect of proceedings under the tax law, if valid, is to divest the true owner of the title to his property, and to vest the same in the holder of the tax deed, and such proceedings must be closely scrutinized and strictly construed. The rule is well settled in this State that:
“The tax title holder cannot proceed by ‘piecemeal ’ to cut off the right of redemption of each part owner. Until he has complied with the statute as to all, the right of redemption remains to all. It seems to me that this is the reasonable construction that is given to these statutes. ’ ’ White v. Shaw, 150 Mich. 270, 273.
Until this is done, the statute provides:
“The person or persons, claiming title under tax deed or certificate of purchase shall be forever barred from asserting such title or claiming a lien on the land by reason of such tax purchase.” 1 Comp. Laws 1929, § 3466.
Defendants not only cannot claim title under the tax deed involved, but are barred from asserting such title or claiming a lien based thereon.
(2) Defendants claim title by adverse possession. If they establish title by adverse possession, such title must be established independent of and contrary to the provisions of 1 Comp. Laws 1929, § 3466. Under the law of this State, color of title is not necessarily the basis of adverse possession. One may claim and acquire title by adverse possession independent of color of title. Lawson v. Bishop, 212 Mich. 691.
“The doctrine which sanctions the divestiture of the true owner by hostile occupancy is to be taken strictly, and the case is not to be made out by inference, but by clear and cogent proof.” Yelverton v. Steele, 40 Mich. 538, cited in Simons v. McCormick, 202 Mich. 485.
“Adverse possession, to give title, must be an actual, continued, visible, notorious, distinct, and hostile possession, and a finding of adverse possession must set forth in explicit terms a state of facts that will satisfy the legal definition. ’ ’ Paldi v. Paldi, 95 Mich. 410, cited in Simons v. McCormick, supra.
“It is also well settled that the possession of an occupant is co-extensive with his claim and color-of title. If in possession of a part under color- of title to the whole tract, his constructive possession extends to the whole; if under color of title to an undivided interest, his constructive possession covers the whole to the extent of such interest; if without color of title, the possession is not extended by construction, beyond the boundaries of the occupied portion.” Campau v. Campau, 44 Mich. 31.
“One claiming* title by adverse possession but not bolding* under color of title acquires no title to any land except what is in his actual possession. There can be no constructive possession without color of title. It cannot be acquired by mere assertion of claim of title. ” 2 C. J. pp. 230, 231.
“The reason on which the rule is based is that when an entry is not under color of title there is no invasion or disseizin which notifies the true owner of a claim asserted by another person, or which gives him a right of action except as to the land actually occupied.” 2 C. J. p. 232.
Mere occupancy of land is not sufficient to give title by adverse possession. Bunce v. Bidwell, 43 Mich. 542.
“A mere claim of title, no matter how long asserted, will not ripen into title.” Doctor v. Turner, 251 Mich. 175.
“It is well settled that the constructive possession of land is in the holder of the record title. ’ ’ Doctor v. Turner, supra.
See, also, 3 Comp. Laws 1929, § 13967.
.“It may well be conceded that paying taxes, or asserting title, or the common understanding in the neighborhood, or making surveys, or an occasional renting for trapping and shooting, is not sufficient to establish title by adverse possession.” Whitaker v. Erie Shooting Club, 102 Mich. 454.
The Harters received deed to the property in 1914. The next year they entered upon the premises, cut some brush, and built a lean-to shack. They left the premises in the fall of 1915, and did not come back again-until the summer of 1922. At that time the house was gone, and while they stayed there a short time they lived in a movable house built on a motor truck. They went back again on the premises, it is claimed, each year until 1928. The Harters lived in Gabon, Ohio, and never lived upon the land in question in any house thereon at any time except in 1915.
The case is analogous to Yelverton v. Hilliard, 38 Mich. 355, where the land in controversy was uninclosed wood land, and the claimed owner gave per mission to another to enter upon and clear off and cultivate such portions of it as he chose, subject to the agreement that in case of sale the claimed owner would pay for the improvements, less the value of the use of the land; in pursuance of such agreement the timber on about one acre of the land was cut off and cleared and inclosed in a fence, plowed, planted to “bagas” which were harvested and removed in October or November following. No other use of the land was made until the conveyance to defendant January 4, 1866. It was said:
‘ ‘ The premises were vacant from the time Turner took off his little crop of turnips in October or November, 1865, to the entry of defendant in the succeeding January, and during this period there seems to have been no adverse possession and no obstacle to an entry by the plaintiff.
“The finding therefore not only fails to show 10 years ’ possession under the tax deeds next preceding the commencement of the action, but on the contrary shows affirmatively that the possession was for a shorter period.”
The question of adverse possession of unoccupied land was considered in Doctor v. Turner, supra, from which the following may be deduced:
a. Constructive possession of land is in the holder of a record title;
b. A mere claim of title, no matter how long asserted, will not ripen into title;
c. Occasional or periodical, entry upon land does not constitute actual possession;
d. In order to make good a claim of title by adverse holding, the true owner must have actual knowledge of the hostile claim; or,
e. The possession must be so open, visible, and notorious as to raise the presumption of notice to the world that the right of the true owner is invaded intentionally, and with the purpose to assert a claim of title adversely to his, so that if the true owner remains in ignorance it is his own fault ;
f. There must be such continuity of possession as will furnish a cause of action for every day during the whole period required to perfect title by adverse possession;
g. The possession must be more than a possession which will enable a person on the ground of a possessory title to maintain trespass or ejectment against a stranger;
h. Occasional trespasses or acts of ownership do not constitute such continuous possession as will ripen into title by adverse possession, though extending*'over the statutory period;
i. Casual hay cutting, amounting to a little more than an annual trespass, is not sufficient to warn the owner of the record title of a claim of adverse possession.
Defendants failed to make out a case of title by adverse possession, and the trial court came to a correct conclusion in so finding.
(3) Defendants claim plaintiffs are estopped from asserting title to the premises in question.
“No estate or interest in lands, other than leases for a term not exceeding* one year, nor any trust or power over or concerning* lands, or in any manner relating thereto, shall hereafter lie 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.” 3 Comp. Laws 1929, §13411.
The title to land may not, under the law of this State, rest on estoppel.
“As our own eases settle this question, it is unnecessary to discuss at length cases from other States. There is a want of harmony upon the subject; but it is confidently believed that the doctrine contended for exists only where the courts have permitted the doctrine of estoppel to override the statute of frauds.” Nowlin Lumber Co. v. Wilson, 119 Mich. 406.
“Unfortunately for defendant’s contention, the statute of frauds prevents the passing of title to realty by parol, and this cannot be done any more under the guise of an estoppel, in the absence of fraud, and when the estoppel consists only of an implied assent, than by showing a-direct parol contract.” Huyck v. Bailey, 100 Mich. 223.
“It has been repeatedly held that interests in land cannot rest on estoppel alone. ■ The statute of frauds forbids.” Wilson v. Railroad Co., 132 Mich. 469.
We are satisfied defendant has not made out a title to the premises in question either under its tax deed or by adverse possession, and plaintiffs are not es-topped from asserting title to the premises.
(4) ■ The decree of the trial court gave the lands to the plaintiffs on condition they pay defendants Basil Harter and Ralph Harter the sum of $564.13, taxes paid on the property, within 60 days from the date of the decree, and if such sum was not paid, the premises might be sold to satisfy that claim, which was made a lien upon the premises. From this part of the decree plaintiffs appeal. The court found the Harters had paid the taxes. They went into possession under a deed from Holmes. Holmes never acquired any title, and had none to convey to them.
“A party, therefore, who enters upon the possession of land .under one, or a series of tax titles, should see to it that he has such a title as will war rant Mm in incurring the liabilities incident to that possession. In imposing this rule, the law only applies in his case the obligation, which is incumbent upon every other purchaser of land, to take care that he has a gobd title if he would derive benefit from it, or enjoyment under it.” Lacey v. Davis, 4 Mich. 140 (66 Am. Dec. 524).
One in possession of land, claiming title, is bound to pay the taxes upon it. Dubois v. Campau, 24 Mich. 360, 368.
The ejectment statute provides, where defendant or defendants, or persons through whom he or they claim title, shall have been in the actual peaceable occupation of the premises recovered for six years before the commencement of the action or the same shall have been so occupied for a less time than six years under color of title and in good faith, the defendant shall be allowed compensation for the buildings and improvements on the premises placed thereon by them, though the plaintiff may recover, and, upon judgment being entered, the plaintiff may elect to abandon the premises to the defendant or pay for the value of the improvements found. 3 Comp. Laws 1929, §§ 14946-14949. These statutes are not applicable to cases like that here involved, though they may have influenced the trial court, whose decree seems to be based upon the rule that it might grant relief upon reasonable conditions. We-are not, under the circumstances, disposed to modify that decree, which is affirmed, with costs.
McDonald, C. J., and Clark, Sharpe, North, Fead, and Butzel, JJ., concurred with Potter, J. Wiest, J., concurred in the result. | [
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Wiest, J.
Plaintiff sued defendant Jacob J. Levy and obtained a judgment in tbe circuit court.
December 30, 1930, plaintiff sued out a writ of garnishment against the Kroger Grocery & Baking Company, a tenant of Levy, to reach a monthly instalment of rent, payable in advance on January 1, 1931. January 30, 1931, a second writ of garnishment was sued out to reach the rent payable in advance on February 1st. February 4, 1931, defendant Levy moved to quash the writs alleging,
“That each of said jvrits of garnishment was served before there was any money due the principal defendant from the garnishee defendant, as is shown by the files and records in this cause, ’ ’
Also—
‘ ‘ That whatever 'moneys would be due from the said garnishee defendant to principal defendant would be by virtue of a written lease according to the terms of which the rent is payable on the first day of the month.”
The record does not show the date of argument of the motion, but on March 10th the motion was denied, the court holding the writs valid under the provision of 3 Comp. Laws 1929, § 14858, permitting garnishment “of any debts due and to become due from such garnishee to the principal defendant.” As pointed out later in this opinion, the motion should have been granted.
Notwithstanding the motion, plaintiff sued out still another writ of garnishment on February 20th, evidently to impound the rent due and payable, in advance, on March 1st. March 3, 1931, plaintiff sued out a fourth writ of garnishment for the January, February, and March rents', theretofore impounded, and now contends that all the writs were valid, but, in any event, the writ of March 3d justified the court in entering judgment against the garnishee for the three months’ rent. The first three writs were premature and wholly abortive, and the last writ was a perversion of civil process. At the date of the first writ the rent was not due, and, therefore, was not an existing debt due or to become due.
The mentioned statute permitting garnishment of “debts due or to become due from such garnishee to the principal defendant,” relates only to debts existing at the time of garnishment and payable then or in the future. If the debt is then a fixed one, and payment only is delayed, the statute applies, otherwise not.
As said in Malone v. Moore, 204 Iowa, 625 (215 N. W. 625, 55 A. L. R. 356):
“Was there ‘a debt to become clue,’ so that it could be reached by the judgment creditor? The garnishment statute clearly contemplates that a garnishee shall be held only in the event that, at the time of the garnishment, he is then owing something to the judgment creditor. It must be something then due or something then owing that is to become due in the future. In other words, in order to hold a garnishee under the statute, it must appear that there is a definite and fixed obligation to pay in any event. If such an obligation is shown, then the garnishee may be held, whether the ‘debt’ is ‘due’ or whether only time is wanting, to fix its maturity. ’ ’
It is elementary law that the right of a plaintiff against the garnishee, except there be fraud, is no more than the right of the principal debtor. In the case at bar the lease provided that:
“If said premises shall be destroyed or made untenantable by fire or other unavoidable casualty, * * * this lease shall cease and no rent shall be charged during the time they shall not be tenant-able. ’ ’
In Malone v. Moore, supra, a decree required the payment of $500 alimony on the last day of every month. "Writ of garnishment to impound a payment due on the last day of a month was sued out before the date of payment. The court held, quoting syllabus :
“The defendant in a decree for alimony (if such decree be assumed to create a ‘debt’) is not garnishable on an instalment which is unmatured on the date of the garnishment, and the maturity of which will be wholly defeated by the death of the plaintiff in alimony before the maturity date as provided by the decree.”
The applicability of this holding to the case at bar is obvious.
Where rent, under a lease, is payable tlfe first day of each month, in advance, the lessee has the whole of the first day of each month in which to make payment. Sherlock v. Thayer, 4 Mich. 355 (66 Am. Dec. 539); Wolf v. Ranck, 150 Iowa, 87 (129 N. W. 319, Ann. Cas. 1912 D, 386); 36 C. J. p. 385; 16 R. C. L. p. 930. Where rent is so payable, in advance, a distraint by the landlord on such day would constitute a trespass. Dalton v. Laudahn, 27 Mich. 529. Rent, before it is due, is not subject to garnishment.
In Ordway Brothers & Co. v. Remington, 12 R. I. 319 (34 Am. Rep. 646), it was held that rent payable on the first day of the month was not legally due, and consequently not subject to garnishment, until after midnight of that day.
In Thorp v. Preston, 42 Mich. 511, it was held, quoting syllabus:
“A tenant cannot be garnished for rent payable in the future, and not absolutely due at the time of garnishment. ’ ’
It is true that at the time of that decision the garnishment statute read debts “due or to become due, absolutely and without depending on any contingency,” and now reads “debts due and to become due,” but, as we have pointed out, the statute still requires an existing debt, either due or to become due.
The first writ was void. The second writ was void as to future rent, and as to rents stopped by the first writ it was a perversion of civil process. The third was void for the same reason. The fourth writ was a clear perversion of civil process and cannot be sanctioned.
“It is a perversion of civil process which cannot be sanctioned to tie up money in the hands of a garnishee by a writ of garnishment or by successive writs, and then without prosecution of the writs employed for that purpose to begin a fresh suit by attaching* the accumulated fund.” 28 C. J. p. 218, citing McNally v. Wilkinson, 20 R. I. 315 (38 Atl. 1053).
In that case successive writs of garnishment were sued out, and the principal defendant moved that the garnishee be discharged but the motion was denied. The court stated :
“We think the ruling was erroneous. The evident purpose of the plaintiff in the proceedings recited, taken as a whole and unexplained, was by successive attachments to secure a sufficient amount in the hands of the garnishee to pay his claim in full, regardless of the legal rights of the defendant. And while it was perfectly proper for the plaintiff to attach a sufficient amount to satisfy his claim on the first writ, either by successive attachments thereon, within the time allowed for the service and before the return day thereof, or by a writ of mesne process issued after the entry thereof in court (Gen. Laws E. I. cap. 252, § 17), yet it was an abuse of legal process to go as far as he could on the first writ and then, without entering that, to sue out another for the same cause of action, and attach the same or an additional amount to satisfy his claim. The law abhors a multiplicity of suits for the same cause of action. If the plaintiff could abandon his first suit in this way and commence a second, he could also abandon a second, a fourth, and so on indefinitely, to the great annoyance and vexation of the defendant and also of the garnishee. To use the process of the court to thus tie up money in the hands of a garnishee until the amount shall become large enough to satisfy the plaintiff’s claim, and then, without entering the writ or writs employed for this purpose, to commence a fresh suit by attaching the fund thus accumulated, not only works a wrong upon the defendant, but is a perversion of civil process, and cannot therefore be sanctioned. The principle that even a valid and lawful act cannot be accomplished by unlawful means, and that wherever such means are resorted to the law will interpose to restore the party injured thereby to his rights, is a salutary and well-established doctrine of the law.”
See, also, Rustad v. Bishop, 80 Minn. 497 (83 N. W. 449, 50 L. R. A. 168, 81 Am. St. Rep. 282).
The judgment against the garnishee defendant is reversed, without a new trial, and with costs to defendant Levy.
McDonald, O. J., and Clark, Potter, Sharpe, North, Fead, and Btttzel, JJ., concurred. | [
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] |
Wiest, J.
Plaintiffs, under contract executed October 25, 1928, constructed an assembly hall for defendant society, and filed the bill herein to foreclose a mechanic’s lien. Defendant Mystic Workers filed a cross-bill to have a mortgage, executed by the society during the course of construction of the building, accorded priority over the lien. In May, 1929, and during the course of construction, the society ran out of funds, and it and plaintiffs were anxious to procure a loan upon the property in order to proceed with the work and pay subcontractors, materialmen, and laborers, as well as plaintiffs. Joint efforts along such 'line were made, but without success, and then it was agreed that if a loan could be obtained by plaintiffs the society would execute a deed to them and they would execute a mortgage to seQure an issue of bonds and then reconvey the property to the society, subject to the mortgage. This agreement was in writing and provided, in part:
‘ ‘ That the parties hereto shall and will co-operate towards the raising of a mortgage on the land and building owned by the said party of the first part (the society) in a sum not exceeding $60,000, said mortgage to be secured by a bond-issue mortgage so-called and promissory note.
“It is further agreed that in the event it becomes necessary to obtain the said mortgage upon the personal financial responsibility which the parties of the second part represent that they have rather than that of the party of the first part, then and in that event the said party of the first part agrees to convey by warranty deed subject to incumbrances of record all of their right, title, claim-and interest in and to the said property to. the said parties of the second part, and the said parties of the second part agree to reconvey in the same manner to the said party of the first part the same property so that the title may revest in said party of the first part immediately after the placing, filing and recording of the said mortgage. * * *
“It is further agreed that the said party of the first part shall under all conditions assume to pay and discharge the said mortgage indebtedness to be placed against the said property without contribution from the parties of the second part.
“It is further agreed and understood that the proceeds to be obtained from the placing of the said mortgage shall be used in the following order:
“1. To pay and discharge the cost of filing and recording and execution of the said bond-issue mortgage, including any bonus or commission.
“2. To pay and discharge all liens which may have been filed against the said property.
“3. To pay and discharge any taxes or incumbrances on record against the said property.
“4. To pay and discharge all claims for labor and material which may have been placed in the said building by a subcontractor of the parties of the second part.
“5. To pay the balance to the parties of the second part at the time of the receipt from them of a waiver and release in full and sworn statements setting forth the true condition and showing that the said parties of the second part are entitled to snch payment under the building contract.
“It is further agreed that after the payment to parties of the second part from the proceeds of said mortgage, if there is any balance due and payable to the said parties of the second part on account of the contract price, then and in that event said balance so payable to the parties of the second part shall be paid by a promissory note which shall be executed at the time of the completion and acceptance of the structure by the party of the first part and the architect, said promissory note to bear interest at the rate of 6 per cent, and shall be payable 90 days from the date of its execution; that at the expiration of the 90-day period upon the payment by the said party of the first part of 10 per cent, of the principal of said promissory note and interest same may be renewed for a further period of 90 days and that at the expiration of each 90-day period a 10 per cent., of the original amount shall be paid in addition to accrued interest until the said promissory note shall be paid in full in installments of 10 per cent, of the principal amount. * * *
“It is further agreed and understood that the party of the first part shall pay and discharge an indebtedness of $4,200 or thereabouts, which is due on the original indebtedness of $6,000 by way of loan obtained by said party of the first part from the Michigan Industrial Bank upon the indorsement or co-making of (by) said parties of the second part, it being understood that the party of the first part has received full credit for the said amount.”
This agreement was not carried out according to its terms. However, the parties got in touch with the Mystic Workers and induced its representative in Detroit to take a mortgage for $50,000, executed by the society, and to advance money from time to time thereunder to pay subcontractors, materialmen, and laborers as well as plaintiffs. Plaintiffs took an active part in inducing the Mystic Workers to take such mortgage and presented a sworn statement of the amount due under the contract. The mortgage was duly executed and various sums advanced for the purpose mentioned, upon orders signed by plaintiffs, the building was completed, and then plaintiffs filed a lien for the balance of the contract price and for extras. Plaintiffs’ claim of lien was for the sum due them and excluded all sums paid subcontractors, materialmen, and laborers by the mortgagee.
In the circuit defendant Mystic Workers was considered the assignee of the lien rights of material-men and laborers, whose claims were paid out of the mortgage loan, and was accorded priority over plaintiffs ’ lien for sums paid materialmen and laborers, and placed in subrogation to plaintiffs’ lien as to all other sums paid under the mortgage, even though actually traced to construction purposes.
Plaintiffs appeal from the priority given for material and labor payments, claiming that liens therefor were not assigned by the materialmen and laborers to the mortgagee. The Mystic Workers also appealed, claiming right to priority to all sums paid out under the mortgage to or for the society, including a brokers’ charge against the society, attorneys’ fees, both for the attorney for the society and the attorneys for the mortgagee, and sums paid out to subcontractors, materialmen, laborers, and to plaintiffs under the construction contract. The mortgagee claims priority arising from waiver of lien by plaintiffs. Plaintiffs claim priority of the lien because the mortgage was subsequent to commencement of work under the building contract, and claim there was no waiver of lien by plaintiffs.
It is clear that plaintiffs were not only willing bnt were active in having the mortgage placed on the property so the work could go on, the bills be paid, and they could have some money 'for themselves. This is established by the mentioned agreement.
But it is contended, in behalf of plaintiff, that the agreement mentioned bonds, secured by a mortgage, and transfer of title to them for the purpose of executing such a mortgage, and the mortgage given was without bonds and given direct by the society, and, therefore, they are in no way estopped from having their lien accorded priority. This contention gives too much effect to the letter of the agreement and not enoug’h to its purpose as ultimately accomplished. Plaintiffs were not at all concerned whether the mortgage secured a bond issue or not; they were concerned with having the society obtain a loan. Plaintiffs were benefited rather than harmed by the change from giving the mortgage themselves and in having the society give it.
The sworn statement of plaintiffs as to the sum due under the construction contract, and presented to the agent of the mortgagee by the attorney for the society and one of plaintiffs, induced the Mystic "Workers to make the loan, and payments of the loan, by the agent of the mortgagee, to subcontractors, materialmen, and laborers, were made upon bills certified for such action by plaintiffs.
Counsel for plaintiffs cite 3 Comp. Laws 1929, § 13125:
“No lien provided for in this act shall be defeated or waived by the taking by the lien claimant, from any person, of any security for such debt, other than upon the real estate itself, in the absence of an express- agreement that the taking of such security shall be a waiver of the lien.”
No such, question is here involved. The agreement by plaintiffs to accept a note for any balance due, if a mortgage was given by them, cannot be held to remit plaintiffs to that remedy, for no such mortgage was given and no note tendered.
We find no waiver of plaintiffs’ lien, but do find subrogation thereof to sums paid by the mortgagee and traced to construction of the building. Loss of otherwise priority may arise where contractors, in effect, by affirmative action, induce or procure a mortgage to be given for their benefit and participate in the proceeds. This holding renders the claim of want of assignment of rights of subcontractors, materialmen, and laborers without merit.
The Mystic Workers ask too much. Waiver of priority has not estopped plaintiffs from having the mortgage lien limited in the matter of priority to sums employed in construction or actually paid to plaintiffs under the building contract. It should be kept in mind that the question of priority, here presented, involves only the rights of the principal contractors and the mortgagee, and not the rights of any subcontractors, materialmen, or laborers. Equitable considerations command that priority, within the scope we have mentioned, be accorded the mortgage lien. Plaintiffs were acting in concert with the society in procuring the loan, and it would be inequitable to now allow them to assert priority over the mortgage which they, in effect, procured to be made, and from which they received substantial benefits as planned.
The decree in the circuit found the amount due on the mortgage and the amount due plaintiffs under the contract and for extras, adjudged plaintiffs ’ lien had priority to that of the mortgage, except as to a former $4,000 mortgage, paid out of the Mystic Workers’ mortgage, and amounts paid to material-men and laborers, and directed a sale with apportionment of the proceeds in conformity with the provisions of the decree.
The decree in the circuit court will be modified to accord with this opinion, and the ease is remanded to the circuit court for ascertainment of the indicated items accorded priority, and settlement of decree. There will be no costs to either party in this court, for both appellants are partly in error in their claims.
McDonald, C. J., and Clark, Potter, Sharpe, - North, Dead, and Btjtzel, JJ., concurred. | [
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North, J.
Plaintiff, trustee in involuntary bankruptcy of Alton F. Petrie, individually and doing business as the Pierson Elevator Company, filed this bill in the circuit court of Kent county for the purpose of securing cancellation of two chattel mortgages and setting aside the foreclosure sales of the property covered by the respective mortgages. One of these mortgages covered the merchandise, fixtures, and bills receivable of a general store owned and operated by Petrie; and the other covered elevator buildings (which stood on land leased of the Pennsylvania Railroad Company), equipment, stock, and bills and accounts receivable. Each mortgage covered subsequently-acquired stock, equipment, bills'receivable, etc. The circuit judge decreed the first of these mortgages valid and refused cancellation ; but he held the other mortgage invalid, and as to it granted the relief sought. All parties have appealed.
Store Mortgage. The objections urged by plaintiff against the chattel mortgage on the general store, as set forth in the supplemental notice of appeal, are: (1) Failure to comply with the provisions of the statute (3 Comp. Laws 1929, §§ 13427, 13428) providing for filing annual renewal affidavits; and (2) that the sale to defendants on foreclosure was irregular.
If we assume, as asserted by plaintiff, that the filing of the first affidavit of renewal was not in exact accord with statutory requirements, the undisputed proof as to both the store mortgage and elevator mortgage is thgi there were properly filed affidavits of renewal for the year in which the bankruptcy proceeding was instituted and also for the preceding year. Further, 3 Comp. Laws 1929, § 13427, contains the following:
“Provided, that such affidavit being made and filed before any purchase of such mortgaged property shall be made, or other mortgage received or lien obtained thereon in good faith, shall be as valid to continue in effect such mortgage, as if the same were made and filed within the period as above provided.”
There is no showing in this record that any of the creditors represented by the trustee in bankruptcy claim as purchasers or mortgagees of any of the mortgaged property, or that they have been prejudiced in any way by the alleged failure to file renewal affidavits. Plaintiff is not entitled to relief on the ground that the affidavits of renewal were not prop erly filed. The claim that the foreclosure sale under the store mortgage was irregular will he considered later in connection with the saíne claim as to the sale under the elevator mortgage. The circuit judge reached the right conclusion in holding that the chattel mortgage on Petrie’s general store was valid.
Elevator Mortgage. This chattel mortgage given to defendants by the corporation was held invalid by the circuit judge on two grounds: First, that it was given áfter the expiration of the corporation’s franchise, and, second, on the ground of noncompliance with the statute requiring consent of stockholders and the filing of evidence of such consent.
The 10-year period for which the Pierson Elevator Company was incorporated expired June 10, 1927. This chattel mortgage was given June 10, 1929. Neither the mortgagor nor the mortgagees were aware of this fact at the time the mortgage was given. Petrie first learned of it when so advised by the secretary of State, in April, 1931; and the mortgagees were not advised until after the bankruptcy proceedings were instituted January 18, 1932. After Petrie received the notice from the' secretary of State, he seems to have assumed that he could rightfully carry on the business individually and continue the use of the corporate name; and as a matter of fact he did continue the elevator business in this manner up to the time he was forced into bankruptcy. Notwithstanding its charter expired June 10, 1927, the corporation filed its annual reports with the secretary of State and paid its annual fees in 1927, 1928, 1929, and 1930. The statute (2 Comp. Laws 1929, §§ 9971, 9975) automatically extends the franchise of the corporation for three years after expiration of its corporate term as fixed by its articles of association, within which extension period application may be made for a renewal of the corporate charter and within which extension period the corporation may carry on such business as is incident to winding up its affairs. It was during this extension period and more than two and a half years before the bankruptcy proceeding that this chattel mortgage was given. No one questions that the parties to the transaction acted in good faith. Admittedly this mortgage was given to secure payment of then-existing indebtednesses of Petrie to defendants, to secure payment of future advancements, and also in connection with Petrie’s contingent indebtedness to defendants as an indorser on notes which they had discounted for him. The mortgage was placed on record both with the township clerk and the register of deeds, and from year to year renewal affidavits were filed. Both Petrie and defendants at all times believed that to the extent of this mortgage defendants were secured creditors. Shortly before the bankruptcy proceeding defendants took possession of the chattel mortgaged property, advertised a chattel mortgage sale, bought the property at the sale for a bid of $6,000, and defendants have'Since continued in the possession and operation of the elevator business.
The attack of the trustee in bankruptcy upon this mortgage is not supported by any equitable considerations, but instead is based primarily upon alleged failure to comply strictly with statutory requirements. The actual controversy is between the unsecured creditors of Petrie who have filed claims in the bankruptcy proceeding and these defendants who in the regular course of business took this chattel mortgage long prior to the bankruptcy. The inequity of plaintiff’s suit is all the more pronounced by reason of the fact that these defendants have not filed claims in the bankruptcy court and probably could not do so at this late date. The result is 'that plaintiff by this suit in equity seeks to turn the mortgaged property over to Petrie’s other creditors to the exclusion of defendants.
At the time of giving the mortgage, the mortgagor, Pierson Elevator Company, was actively carrying on its business in its corporate capacity. All who were dealing with it at that time seemed to have recognized it as a corporation. This was true of defendants. Even the State, by accepting the annual reports and fees, acknowledged the extension of the corporate franchise. As noted above, all the parties to the mortgage acted in good faith. The consideration for which the mortgage was given evidently went into the corporation’s business, at least there is no showing to the contrary. Nor is there any showing that giving this mortgage was in any way a fraud upon any of the creditors whom plaintiff represents. Surely neither the corporation nor Petrie by whom it was controlled could successfully question the validity of this mortgage in a court of equity. Under the facts here involved, the trustee should be held to stand in the place of the mortgagor and not permitted to void the mortgage notwithstanding it was given after the expiration of the 10-year corporate period fixed in the articles of association. To hold otherwise would be highly inequitable.
The other ground upon which the circuit judge held the mortgage invalid was that its execution does not appear to have been authorized by the holders of two-thirds of the outstanding stock of the corporation, and that the certificate of such authorization was not filed with the mortgage. (See 2 Comp. Laws 1929, § 10012.) The corporation was controlled by Petrie. Both- he and his wife were stockholders and served as two of its three officers. He was president, she secretary-treasurer. The total outstanding stock was 2,000 shares. Of this Petrie alone held 1,625 shares, which was over 80 per cent, of the total. Both he and his wife signed this chattel mortgage in their official capacity. While there has been much difference of judicial opinion as to whether the above-cited statutory provision is for the benefit of stockholders or the benefit of creditors or for both (see In re Progressive Wall Paper Corp., 230 Fed. 171 [37 Am. Bankruptcy Rep. 207]), we are committed to the holding that at least primarily the'provision is for the benefit of stockholders, and if the stockholders who execute such a mortgage hold at least two-thirds of the outstanding stock there is substantial compliance with the statute.
“The purpose of the statute is to protect stockholders. # * * The mortgage was-executed by the usual officers, the president and secretary ofi the Farrell Products Company, and carried their affidavits of authority. The claim that the mortgage was invalid was an affirmative defense. 14A C. J. p. 709; Earle v. National Metallurgic Co., 77 N. J. Eq. 17 (76 Atl. 555). The defendants had the burden of proving that the persons executing the mortgage, Casey and Coble, were not the owners of two-thirds of the Farrell stock, either directly or through ownership of Tri-Plex shares.” Loupee v. Railroad Co., 243 Mich. 144, 149.
It may be added in this connection that Mr. Petrie testified:
“Prior to the time that this chattel mortgage was executed] all three officers of the corporation talked it over. I would not say it was a regular meeting; never put it in a minute book. I don’t recall that it was ever reduced to writing anywhere.”
Relative to this statutory provision requiring the consent of the stockholders to be filed or recorded with the chattel mortgage, in Grand Victory Theatre v. Solomon, 224 Mich. 451, Mr. Justice McDonald, after quoting 14A C. J. § 2663, p. 665, said:
“As between the parties to the mortgage, a compliance with this provision is not necessary to its validity. ’ ’
Since the statutory provision requiring consent of two-thirds of the outstanding stock (except in cases of purchase-price mortgages) and requiring filing or recording with the mortgage a certificate of such consent is for the benefit of stockholders, failure to comply with the statute cannot be urged by plaintiff, who represents creditors only. In any event, the result sought by. plaintiff, being based solely upon failure to comply with the statute, is one which, under the circumstances of this case, does not appeal to the conscience of a court in equity. From the foregoing, it follows that we are not in accord with the reasons assigned for holding in the circuit court that the corporate mortgage was invalid.
In addition to the above-considered objections, plaintiff also urges invalidity of this mortgage on the ground that it was given in violation of Act No. 200, Pub. Acts 1929 (2 Comp. Laws 1929, §§ 9548, 9549). The purport of this act is indicated by the following:
“Section 1. Every mortgage or conveyance intended to operate as a mortgage of the whole or any part of a stock of merchandise or merchandise and fixtures, pertaining to the conducting of said business which shall hereafter be made without notice to the creditors of the mortgagor as herein provided, shall be void as against said creditors.”
There are two reasons why plaintiff’s contention cannot be sustained: First, it appears from the portion of the act above quoted that its purpose was the protection of creditors who were such at the time the mortgage was givexx, not subsequexxt creditors. "We find no showing in this record that any of the creditors represented by plaintiff were such at the time the mortgage was given. A second reason which renders plaintiff’s contention untenable is that Act No. 200 did xiot become effective until August 28, 1929. While this chattel mortgage was not filed until shortly subsequent to August 28,1929, it was executed and delivered to defendants on June 10, 1929, which was several months prior to the effective date of the act. As between the mortgagor and the mortgagee, it was an existing contract as soon as consummated. Legislation which became effective at a later date could not invalidate this contract. To hold otherwise would be an attempt to render it operative ex post facto, and also as impairing a contract obligation in violation of the Constitution. Michigan Constitution, art. 2, § 9.
As to claimed irregularities incident to the chattel mortgage sale under the elevator mortgage and also the sale uxxder the store mortgage, we find nothing in the record which would justify cancellation of such sales. Plaintiff makes no claims of actual prejudice to the rights of the creditors whom he represexxts. His complaint is that, by reason of defendants holding possession as purchasers at the chattel mortgage sales, plaintiff as trustee in bankruptcy'was prevented from taking possession of the mortgaged property. But it is not even suggested that a larger bid could be secured on resale. However, plaintiff asserts that since defendants bid $6,000 on the foreclosure of the elevator mortgage, and the mortgagor was then indebted to the bank for only $5,207.66, there should be an accounting to plaintiff for the balance. In so asserting, plaintiff overlooks the fact that the corporation’s chattel mortgage not only secured its indebtedness to the bank but also to the defendant Crimmins. At the time of foreclosure the elevator company was not only indebted to the bank in the amount above noted, but also to Crimmins personally and for an amount much in excess of that for which plaintiff asks an accounting. A careful consideration of this record in connection with the questions raised brings us to the conclusion that the portion of the decree entered in the circuit court holding that the chattel mortgage given by the Pierson Elevator Company was invalid must be reversed.
A decree may be entered in this court dismissing plaintiff’s bill of complaint, with costs of both courts.
McDonald, C. J., and Clark, Potter, Sharpe, Fead, Wiest, and Btjtzel, JJ., concurred.
This aet has been amended by Aet No. 198, Dub, Aets 1931, | [
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Potter, J.
Plaintiff, administratrix of the estate of II. Firth Anderson, deceased, brought suit against the Schust Company to recover damages for the death of plaintiff’s decedent. From a judgment for defendant, plaintiff appeals. Judgment having been directed for defendant by the trial court, the testimony introduced must be construed in its light most favorable to plaintiff.
The only question involved is whether such testimony was sufficient, in law, to make it incumbent upon the trial court to submit the case to the jury. Plaintiff says it was sufficient. Defendant claims it was insufficient. Defendant’s car was being driven by Merle J. Bowman, who worked for defendant in Grand Rapids. Edward J. Rohring of Grand Rapids had charge of the Schust agency there. He had been instructed by defendant to use its cars only in the company’s business. Rohring, then branch manager at Grand Rapids, told Bowman he could take the car on the occasion in question and drive to Pin-conning. It was on this trip the accident occurred. The court found the clear, undisputed, and uncontradicted proof on the part of plaintiff showed the car of defendant was being driven at the time and place of the collision by Mr. Bowman, an employee of defendant, for Ms own pleasure or business, and not in tbe business of defendant, nor within the scope of his employment as an employee of defendant. Though he was driving defendant’s car with the express consent of Mr. Rohring’, defendant’s branch manager, it was against the positive orders and instructions of defendant to its branch manager Mr. Rohring, who violated such orders and instructions given him, in permitting Bowman to drive the car for his own pleasure and business; that Rohring as branch manager was not acting in the scope of his authority or in furtherance of the'business of defendant in loaning defendant’s car to Bowman, and therefore the car was not being driven with the consent of the defendant, either express or implied, and plaintiff could not recover.
It is conceded defendant cannot be held liable unless the motor vehicle driven by Bowman was driven with the express or implied consent or knowledge of defendant. 1 Comp. Laws 1929, § 4648. There is no claim the motor vehicle was being driven with the express consent or knowledge of defendant. The important question is whether it was being driven with its implied knowledge or consent.
As between the master and servant, the master is liable only when the servant acts within the actual scope of his authority, but as between defendant and third persons injured by the acts of the servant, defendant may be liable when the servant is acting within the apparent scope of his authority.
A servant may be within the scope of his employment even though conducting his master’s business in a manner contrary to his instructions (Loux v. Harris, 226 Mich. 315); and therefore it is frequently held a defendant is liable for accidents caused by the operation of a motor vehicle used by his servant in going to and from his work, upon the theory the servant is engaged in the master’s business. The true rule is that for a positive wrong by a servant beyond the scope of the master’s business intentionally or recklessly done, the master cannot be held liable. Such acts may constitute personal torts of the servant, but the master is not responsible. When, however, the wrong arises from an excess of authority, in furthering the master’s interest, and the master receives the benefit of the act, if any, the master may be liable because liability does not depend upon the limit of the servant’s authority. Chicago & Northwestern R. Co. v. Bayfield, 37 Mich. 205 (16 Am. Neg. Cas. 87). An assent may only be implied if Bowman’s act was against the instructions of defendant and if Bowman was acting within the apparent scope of his authority.
Within the scope of employment or within the scope of the authority of the master means while engaging* in the service of the master or being about the master’s business. Eberle Brewing Co. v. Briscoe Motor Co., 194 Mich. 140. There is no question but that Mr. Rohring had instructions the motor vehicles of defendant were to be used only in the business of the defendant, and were not to be used for private purposes. Mr. Bowman, after obtaining consent of Mr. Rohring, the branch manager of defendant at Grand Rapids, to use the motor vehicle in question to go to Pinconning to visit his father, was not acting within the sc,ope of his employment in his master’s business, was not engaged in the service of the defendant, but was engaged in his own personal business or pleasure. Defendant cannot be held liable for the acts of Mr. Bowman when engaged in pursuing his own business or pleasure. It can only be held liable for the acts of Mr. Bowman if lie was engaged in the service of the defendant furthering its interest or about its business when the accident occurred. Under the undisputed facts, Mr. Bowman was not so engaged at the time of the accident, and therefore cannot be held to have been operating defendant’s motor vehicle with its implied knowledge or consent. We think the trial court correct in directing a verdict for defendant. Judgment affirmed, with costs.
McDonald, C. J., and Clark, Sharpe, North, Fbad, Wibst, and Btjtzbl, JJ., 'concurred. | [
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Per Curiam.
Plaintiff is the elected Clerk of Ottawa County and is vested with the powers and duties imposed upon him by the Michigan Legislature through various enacted statutes. The defendant board of commissioners is the elected legislative and administrative body of the county, the duties and powers of which are also prescribed by statute.
In 1975, the board of commissioners created the position of county controller, the person appointed thereto to act as the chief financial officer for the county. At that time, the appointed controller assumed the accounts payable function of the clerk and all personnel materials, ledgers and vouchers were transferred to the controller’s office.
Plaintiff filed his complaint against defendants on April 15, 1979, seeking a declaratory judgment as to the duties and functions of the county clerk as compared to those of the county controller and a writ of mandamus directing defendants to return those functions to the office of the county clerk. Following a bench trial, the trial court found in favor of the defendants and denied the writ of mandamus. Plaintiff now appeals as of right.
At trial and on appeal, plaintiff claims the following are statutory duties of his office: (1) receiving and processing claims against the county, heretofore referred to as the accounts payable function; (2) preserving and maintaining the cost classification ledger; and (3) check writing for expenditures and payroll under the county budget. In addition, plaintiff claims that he must have control over the use of his signature on the county check protector.
In denying the writ of mandamus, the trial court determined that plaintiff "already has that which he essentially seeks”. In particular, the trial court held that (1) the clerk is the record keeper or custodian of the board’s original records; (2) the clerk has in his possession all the "original books and records” of the board as contemplated by statute; (3) the controller is the accounting officer or bookkeeper of the county as intended by statute; (4) the clerk is not entitled to possess vouchers or original source documents which are used merely to input data into the computer; and (5) since no statute requires the clerk’s signature on any county checks, he can refuse to have his name impressed on the checks if he so desires. We reverse in part.
Both parties cite Gogebic County Clerk v Gogebic County Bd of Comm’rs, 102 Mich App 251; 301 NW2d 491 (1980), as controlling in this case. This Court agrees that no other Michigan decision has addressed the interrelationship between county clerk and controller.
In addition to addressing the substantive issue herein, Gogebic set forth the requirements for mandamus relief:
" 'Mandamus lies only when there is a clear legal duty incumbent on the defendant and a clear legal right in the plaintiff to the discharge of such duty. Miller v Detroit, 250 Mich 633; 230 NW 936 (1930). The specific act sought to be compelled must be of a ministerial nature, that is, prescribed and defined by law with such precision and certainty as to leave nothing to the exercise of discretion or judgment. Taylor v Ottawa Circuit Judge, 343 Mich 440; 72 NW2d 146 (1955); Bills v Grand Blanc Twp, 59 Mich App 619; 229 NW2d 871 (1975); State Board of Education v Garden City School District, 62 Mich App 376; 233 NW2d 547 (1975).’” Gogebic, supra, 261, quoting, Board of County Road Comm’rs of Oakland County v State Highway Comm, 79 Mich App 505, 509; 261 NW2d 329 (1977), lv den 402 Mich 907 (1978).
The facts in Gogebic are strikingly similar to the instant case. The Gogebic County Clerk challenged the actions of the controller in removing and then retaining control of the books, records and accounts of the board of commissioners, and duties relating thereto, formerly in the possession of the clerk, and the actions of the board and the controller with respect to the endorsing of warrants and checks for the payment of claims from public funds. A major distinction between Gogebic and the instant case is that the Gogebic Controller was improperly hired by a subcommittee of the board, rather than the full board, contrary to MCL 46.13b; MSA 5.336. Thus, he lacked the authority to sign any checks. However, this distinction is insignificant to the present mission as this Court addressed the powers of the controller irrespective of whether he was properly hired. We find the decision and reasoning of Gogebic highly persuasive in resolving the issues in the case at bar.
The Gogebic Court summarized the duties and powers of the county clerk as set forth by statute:
"Under MCL 46.4; MSA 5.324, the county clerk is designated as the clerk for the board of commissioners. This statute also states that, in such position, the clerk is responsible for, among other things, preserving and filing 'all accounts acted upon by the board, and [on] no account [shall he] allow such accounts to be taken from his office’. MCL 46.5; MSA 5.325, further provides that 'the books, records and accounts of the county board of commissioners shall be deposited with their clerk’. While such documents are to be made available to the public under the Michigan Freedom of Information Act, 1976 PA 442; MCL 15.231 et seq.; MSA 4.1801(1) et seq., no one may remove them from the clerk’s office and refuse to return them, MCL 750.491; MSA 28.759, and the officer in custody shall not permit their removal except by court order, subpoena duces tecum, or for purposes of an audit. MCL 750.492; MSA 28.760.” 102 Mich App 262-263.
Then the Court reviewed the powers and duties of the county controller, also set forth by statute:
"The controller shall be the chief accounting officer of the county and shall have charge and supervision of the accounts and accounting of every office, officer and department of the county, the whole or any part of the expense of which are borne by the county. The controller shall see that a system of accounting is installed and property [sic] kept by every office, officer and department of the county in strict accord with the provisions of law, and in addition to which he may prescribe and direct the keeping of such other accounts and records and the making of such reports as in his judgment are necessary to properly record and report the financial transactions of the county. All county officers or employees shall furnish such information respecting all county matters in their charge as the controller shall require. The controller shall keep in his office a general ledger in which shall be set up controlling accounts which shall show at all times the assets and liabilities of the county, and of each and every of its funds. The controller shall examine regularly the books and accounts of the several officers, agents and departments of the county and report his findings to the board of supervisors at such times as they shall prescribe. * * * The controller shall perform such other duties as the board of supervisors may impose .” MCL 46.13b; MSA 5.336. (Emphasis added.)
The Court reasoned:
"The language of this statute, on its face, does not conflict with the provisions of §§4 and 5 noted above. Rather, it suggests that the controller should oversee (supervise) the books and accounts of all county offices and departments. It says nothing about possession of such accounts; such an arrangement would complicate rather than streamline county finances. And yet, if the controller were intended to have custody and control over the board’s books and accounts, the statute should so state, since such would clearly contradict the clerk’s statutes. Further, if possession and control of the board’s accounts was found to be mandated by the above statute, the controller would likewise have to assume possession and control over all county books and accounts; clearly, the statute does not distinguish between the accounts of one office or department and those of another.” (Emphasis in Gogebic.) 102 Mich App 263.
Accordingly, the Court concluded that the controller lacked the statutory basis to take possession and control of the board’s books and accounts because such possession and control is placed by statute in the county clerk, Gogebic, p 265, and affirmed the trial court’s issuance of the writ of mandamus.
In the instant case, plaintiff testified that he possesses all board records, including the list of approved claims, revenue receipts and special payroll vouchers. He contends, however, that he is more than a mere recordkeeper. He argues that he must also perform the accounts payable function. Thus, the issue in this case is whether the phrase "control of the board’s books and accounts” means mere custodial recordkeeping or whether it entails the accounts payable function.
A review of this Court’s opinion in Gogebic alone suggests that all this Court decided was whether the clerk is the proper custodian of the board’s records. The decision did not fully address the accounts payable function. However, as mentioned above, this Court affirmed a writ of mandamus that addressed far more than which office is to maintain possession of the board’s records.
In Gogebic, all claims were forwarded directly to the controller who entered the claims in a claims and accounts ledger for submission to the finance committee. Gogebic, pp 257-258. The trial court in Gogebic stated in its opinion: "The board by removing the physical control of the book of claims, the book containing the board proceedings, and other books, records and accounts of the county board of commissioners from the county clerk’s office to the controller’s office has eliminated procedural safeguards, and this is a violation of a public trust.” Thus, while this Court’s opinion does not specifically state who shall perform the accounts payable function, it is implicit in the affirmance of the writ that claims are to be processed by the clerk.
In Gogebic, this Court stated:
"The scheme provided by the interrelationship of §§ 4 and 5 and § 13b may be envisioned as a network which is wheel-shaped. The controller is the hub; the several offices, officers and departments which by their nature require the keeping of individual books and accounts are the spokes. Each spoke has day-to-day responsibility for its books and accounts, albeit under a system of accounting imposed by the controller. The financial data gathered in each of the books and accounts is tunneled to the board through the controller, whose general ledger will then reflect an up-to-date overall view of the county’s finances. In this manner, a person or entity interested in a financial picture of the county need only go to the controller’s general ledger rather than to each of the books and accounts seriatim.” Gogebic, supra, pp 264-265.
Applying this rationale to the case at bar, we conclude that board transactions, which include the approval of certain claims, constitute one of the "spokes of the hub”, giving the board day-today responsibility for its accounts and books. Since the clerk is, by statute, required to preserve and file all accounts acted upon by the board, and retain custody and control of the board’s books, records, and accounts, we hold that the accounts payable function, by which board-approved claims against the county are paid, is properly performed only by the clerk.
Support for this interpretation is found in MCL 46.11(q); MSA 5.331(q), which provides that no claim, bill or charge shall be allowed by the board unless it has been filed with the county clerk at least four days before a regular board meeting. The statute further requires the clerk to "keep a book in which all claims in the order in which the claims are presented, giving the name of the claimant, the amount of claim, and the date when presented”. Construing this statute according to its ordinary meaning, this Court believes that all claims against the county, whether by voucher or other "original source document”, must be filed directly with the clerk, not the controller, for processing. The present system does not satisfy this statute.
Defendant controller contends, however, that controlling the original source documentation is a prerequisite to the fulfillment of his duties under the Uniform Budgeting and Accounting Act, MCL 141.421 et seq.; MSA 5.3228(21) et seq. Specifically, § 14 of that act provides that the controller, as chief administrative officer, shall have the final responsibility for budget preparation, presentation of the budget to the legislative body, and control of expenditures under the budget.
The clerk does not seek to usurp any of the statutory duties imposed upon the controller. He seeks only to perform the accounts payable function, the processing of claims that require board approval. Because the board reserves the discretion to allow or disallow claims, the clerk’s function in processing the claims is ministerial in nature. On the other hand, the controller’s duties are to implement and oversee a method of accounting in every county department. He is also required to examine the books and accounts of every department and report his findings to the board. In this manner, he assumes responsibility for the budget and expenditures thereunder. We do not believe that by allowing the clerk to perform the accounts payable function, the controller is necessarily precluded from fulfilling the duties imposed upon him by statute.
The next issue is whether plaintiff has the legal right to prepare and issue county checks, including payroll warrants. Plaintiff argues that because it is the county clerk’s department that processes the claims, it is only logical that it be allowed to pay them. While this may be true, mandamus relief can only be granted upon the showing of a clear legal right in plaintiff to perform that function. We find the statutes silent on who is to perform the payment of claims except in one category. MCL 45.403; MSA 5.913 provides that the salaries of the county sheriff, undersheriff, county clerk, county treasurer and register of deeds and their deputies "shall be paid monthly by the county treasurer, upon a warrant issued by the county clerk, but not until an itemized statement of all fees collected and paid over to the county treasurer, as aforesaid, has been sworn to and filed with the county treasurer and duplicate of the receipt thereof filed with the county clerk”.
We further note that MCL 45.402; MSA 5.912 imposes a duty on these officers to keep a true and accurate account of all fees received by them in conjunction with their county duties and to pay the same over to the county treasurer. See Cass County v Shattuck, 288 Mich 555; 285 NW 454 (1939). Also, the failure to comply with either of these provisions may result in conviction of a misdemeanor. MCL 45.408; MSA 5.918.
When construing statutes, this Court will read the statutes in their entirety and harmonize all sections to create a consistent whole. Bannan v City of Saginaw, 120 Mich App 307; 328 NW2d 35 (1982). In Gogebic, supra, we construed § 3 of this act as stating that the county clerk shall sign the warrants for the payroll of these certain officers. 102 Mich App 265.
We note that § 3 provides for a system of checks and balances that protects against a county officer retaining both fees and salary when such an arrangement has not been authorized by ordinance or statute. Accordingly, we believe the Legislature intended to carve out in § 3 a procedure for the payment of salaries to these officers, separate and apart from whatever procedure is used for the payment of other claims against the county. Thus, in order to give effect to every part of the statute as far as possible, we take the holding in Gogebic one step further and conclude that the clerk is statutorily required to issue the warrants for these officers, which in our view means to prepare, sign, and deliver them.
Plaintiff has not established a clear legal right to issue the remainder of the checks or warrants, however.
Plaintiff also maintains that the clerk must possess the cost classification ledger. Prior to 1975, the clerk’s office maintained a cost classification ledger wherein it recorded the daily transactions of the county under the proper budget line item. The controller testified that a cost classification ledger is no longer maintained under his system of accounting. Plaintiff admitted he has never seen such a ledger.
Pursuant to MCL 46.13b; MSA 5.336, the controller must establish a system of accounting and must ensure that every officer and every department adheres to this system. The statute further provides that the controller may "prescribe and direct the keeping of such other accounts and records and the making of such reports as in his judgment are necessary to properly record and report the financial transactions of the county”.
The statute does not mandate the maintenance of a cost classification ledger. Therefore, plaintiff cannot possess a ledger which does not exist and need not exist under the controller’s established accounting system. Although the clerk is entitled to perform the accounts payable function, he must do so within the parameters of the accounting system established by the controller.
Plaintiff also contends that he must have control over the use of his signature on the county check protector. The trial court held that it was not aware of any statute which commands the county clerk to put his name on the county checks. This statement is obviously in error in light of our holding in Gogebic that the clerk is required to sign the payroll checks of certain county officers. However, as we noted earlier in this opinion, this is the only statute which requires the signature of the clerk on county checks. While we assume that plaintiff can decline the use of his name on the county checks other than the payroll checks of these officers, plaintiff has stated, and we have found, no authority for the proposition that he must have control over the check protector.
Therefore, this aspect of plaintiffs complaint was properly denied.
Reversed in part and remanded. We retain no further jurisdiction. | [
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Shepherd, J.
Respondent Linda Render appeals as of right from an order terminating her parental rights. Respondent raises three issues. Two of her claims lack merit. The third, that the probate court failed to take sufficient steps to secure respondent’s presence at the dispositional hearing, has some merit. We remand the matter to the probate court for further proceedings.
The first two claims call for little discussion.
Respondent argues that the probate court never made a clear determination of jurisdiction in this matter. The record indicates otherwise. At the hearing on April 29, 1983, the probate court ordered placement of the child in foster care because of respondent’s long history of mental illness. We conclude that the court properly asserted its juris diction in this case. MCL 712A.2(b); MSA 27.3178(598.2)(b).
Respondent also argues that the probate court failed to comply with MCL 712A. 19; MSA 27.3178(598.19), which requires that "[i]n all cases in which the child is placed in foster care, the cause shall be reheard not more than 6 months after entry of the order of disposition”. The probate court placed the child in temporary foster care on April 29, 1983. The court held a hearing on June 13, 1983. There was some discussion of the possibility that the alleged father would take custody of the child. The court adjourned the matter until completion of a study of the father’s home. Respondent’s attorney agreed to this adjournment. Respondent fails to mention the June 13 hearing in her brief on appeal. There was no violation of MCL 712A.19.
The probate court held the dispositional hearing on January 30, 1984. Respondent was in the county jail. Respondent was served at the jail with a notice of the hearing. However, respondent’s attorney stated that he only learned of her incarceration on the day of the hearing. Without further inquiry, the court directed the prosecutor to proceed with his proofs. Sometime in January, 1984 (from the record it is not clear exactly when), respondent was sentenced to from two to four years imprisonment.
Respondent argues that the probate court’s failure to secure her presence at the hearing deprived her of due process of law. US Const, AM XIV; Const 1963, art 1, § 17. Petitioner asserts that respondent waived the right to be present by failing to contact her attorney after being served with notice of the hearing.
The issue is whether due process required the probate court to make an affirmative effort to secure respondent’s presence. On the facts of this case, we believe it did.
Even in ordinary civil actions, each party is entitled to be present in the courtroom "at all stages during the actual trial of the action”. 75 AM Jur 2d, Trial, § 51, p 164 (citations omitted). See, Hunter v Szumlanski, 124 Mich App 521; 335 NW2d 75 (1983), rev’d on other grounds 418 Mich 958 (1984); Florence v Moors Concrete Products, Inc, 35 Mich App 613; 193 NW2d 72 (1971), lv den 387 Mich 761 (1972). "They must be given the opportunity to be present, but if that opportunity is given, their absence during the trial does not affect the right to proceed.” 75 Am Jur 2d, supra (footnote omitted).
In this case the state seeks to terminate respondent’s parental rights. The requirements of due process in this context are much greater than in the ordinary civil action. As noted by Justice Fitzgerald in Westland Convalescent Center v Blue Cross & Blue Shield of Michigan, 414 Mich 247, 261; 324 NW2d 851 (1982):
"Notice and the opportunity to be heard are fundamental concepts in the jurisprudence of our state and federal courts. No rigid rule determines which interests will be protected or unprotected; the conclusion to be drawn is that what is procedurally fair in one situation to protect the rights of individuals may be unfair in another.”
A parent’s interest in retention of his or her rights "undeniably warrants deference and, absent a powerful countervailing interest, protection”. Stanley v Illinois, 405 US 645, 651; 92 S Ct 1208; 31 L Ed 2d 551 (1972); Reist v Bay Circuit Judge, 396 Mich 326, 341-342; 241 NW2d 55 (1976) (Levin, J). Due to the fundamental nature of this interest, the state bears the burden (imposed by the federal constitution) of proving by clear and convincing evidence that termination of parental rights is warranted. Santosky v Kramer, 455 US 745; 102 S Ct 1388; 71 L Ed 2d 599 (1982).
In Michigan, both the courts and the Legislature have done more than react to federal mandates in parental rights termination proceedings. For example, we embraced the "clear and convincing evidence” standard long before Santosky, supra. See, In the Matter of Lafture, 48 Mich App 377;. 210 NW2d 482 (1973), lv den 390 Mich 814 (1973). Although the Supreme Court held, in Lassiter v Dep’t of Social Services of Durham County, North Carolina, 452 US 18; 101 S Ct 2153; 68 L Ed 2d 640 (1981), that the Fourteenth Amendment does not require appointment of counsel for the respondent in every such proceeding, the Michigan courts have reached the opposite conclusion. Reist, supra (requiring appointment of counsel for respondent on appeal of right), MCR 1985, 5.906(C), In the Matter of Martin W Cobb, 130 Mich App 598, 600; 344 NW2d 12 (1983). The Legislature has acknowledged the state’s own interest in an accurate and just decision by requiring that the parents appear at the dispositional hearing "to show the efforts made by them to reestablish a home for the child” and, upon rehearing, "to show why the child should not be placed in permanent custody of the court”. MCL 712A.19.
Thus, respondent’s parental rights consitutue a "liberty” interest entitled to constitutional protection. One analytical mode for ascertaining the requirements of due process in this area is that used by the United States Supreme Court in Mathews v Eldridge, 424 US 319, 335; 96 S Ct 893; 47 L Ed 2d 18 (1976):
"[[Identification of the specific dictates of due process generally requires consideration of three distinct factors: first, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.” (Citation omitted.)
As noted above, the respondent’s interest in her parental rights is a compelling one. The risk of an erroneous deprivation is increased in the parent’s absence. The Legislature has recognized this by requiring the parent’s presence at the hearing. MCL 712A.19. Though respondent had an attorney at the dispositional hearing, it is impossible to determine whether she could have provided the attorney with information helpful to her defense. We are "not in a position to know whether in fact any prejudice resulted”. Florence, supra, p 621. It cannot be doubted that, in many parental rights termination hearings, the presence of the very person whose rights the state aims to take away is of some "probable value” to the correctness of the result. Mathews, supra. The burden on the state is not a substantial one, at least not in the present case, where it appears the respondent was incarcerated in the county jail.
We hold that, due to the great deference ac corded parental rights under Michigan law, the probate court erred in this case by proceeding with the dispositional hearing. The court should have made an effort to bring respondent to the courtroom. We cannot agree with petitioner’s waiver argument. There was no waiver. Counsel stated he had not spoken with his client for quite some time. Nor do we believe that respondent waived her right to be present by failing to contact her attorney. Respondent was in jail at the time. She may have thought that she would be brought to the probate court without a special request. Whatever the explanation, reception of a notice of hearing followed by silence is not enough to show a voluntary waiver, when the respondent is in the custody of the state.
What is the proper remedy? The procedural fairness signified by the phrase "due process” allows a great measure of flexibility in fashioning an appropriate remedy. We believe that a completely new dispositional hearing would be excessive, given the nature of the constitutional violation. Rather, on remand, the probate court must arrange for respondent’s presence and give her an opportunity to present evidence concerning her fitness and efforts, if any, to provide a fit home for the child. Cf., In the Matter of Taurus F, 415 Mich 512; 330 NW2d 33 (1982). The probate court shall then make new findings of fact and state its conclusions, as provided in MCR 1985, 5.914.
Remanded for further proceedings consistent with this opinion.
We allude to the Mathews analysis only as one framework for consideration of the due process question under both Michigan and federal law, not as the basis for our decision. Mathews provides a helpful tool for analysis of such issues. Lassiter, supra, 452 US 26-32; In re Juvenile Appeal, 187 Conn 431 446 A2d 808 (1982). Nevertheless, our decision is neither based solely on Mathews nor solely upon our conception of what the Fourteenth Amendment dictates, but on the Michigan due process clause as well. Const 1963, art 1, § 17. See, Michigan v Long, 363 US 1032; 103 S Ct 3469; 77 L Ed 2d 1201, 1214-1216 (1983).
The probate court relied in part on MCL 712A.19a(d); MSA 27.3178(598.19aXd), which allows for termination of parental rights "if the parent or guardian is imprisoned for such a period that the child will be deprived of a normal home for a period of more than 2 years”. However, the petition was based on MCL 712A.19a(c); MSA 27.3178(598.19a)(c), i.e., respondent’s long record of mental illness and consequent unfitness for parenthood. It is not clear from its opinion whether the probate court would have terminated respondent’s rights based solely on her imprisonment. We leave that issue for disposition on remand. | [
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] |
Beasley, P.J.
Plaintiff, Janice A. Gillispie, appeals as of right from an order denying her motion to set aside a document entitled a Satisfaction of Judgment.
The history of this case is set forth in Gillispie v Board of Tenant Affairs of the Detroit Housing Comm, in which we affirmed a judgment of $500,-000 in favor of plaintiff. This judgment was entered after an order of remittitur had reduced a jury verdict of $750,000. The parties agreed that $956,463.50 would fully pay the judgment, and that amount was paid to plaintiff. On January 20, 1984, a satisfaction of judgment was filed. At no time prior to the filing of the satisfaction of judgment did plaintiff ever dispute the method utilized to calculate the interest.
In August, 1984, plaintiff filed a motion in the circuit court for relief from final proceedings pursuant to GCR 1963, 528.3(1), now MCR 2.612(C)(1)(a). Plaintiff argued that relief should be granted based on a mistake, which she contends became apparent after this court’s decision in Gage v Ford Motor Co, but the motion was denied.
On appeal, plaintiff claims that the trial court abused its discretion in denying her motion to set aside the satisfaction of judgment.
MCL 600.6013; MSA 27A.6013, which governs the computation of interest on money judgments recovered in civil actions, was amended by 1980 PA 134 to read:
"Sec. 6013. (1) Interest shall be allowed on a money judgment recovered in a civil action, as provided in this section.
"(2) For complaints filed before June 1, 1980, in an action involving other than a written instrument having a rate of interest exceeding 6% per year, the interest on the judgment shall be calculated from the date of filing the complaint to June 1, 1980 at the rate of 6% per year and on and after June 1, 1980 to the date of satisfaction of the judgment at the rate of 12% per year compounded annually.”
Prior to the Gage decision, there was considerable confusion as to whether the 12% should be compounded only on the original judgment or on the balance owing as of June 1, 1980., In Gage, this Court decided the question in favor of the latter interpretation. The parties in the within case, however, calculated the interest owing on plaintiffs award in accord with the other method. Plaintiff sought relief from the judgment after publication of Gage on the basis that the calculation of interest was the result of a mutual mistake. As indicated, the trial court denied plaintiffs motion to set aside the judgment.
Denial of a motion to set aside a judgment will not be reversed on appeal absent an abuse of discretion. Relief from a judgment under GCR 1963, 528.3(1) will only be granted when the circumstances are extraordinary and the failure to grant the relief would result in substantial injustice. A mutual mistake is one in which the written instrument differs from the parties’ intent because of a mutual; error. It does not refer to a mistake regarding an extrinsic fact. In Marshall v Marshall, we examined the effect of a mutual mistake on a property settlement agreement and held that if there was no mistake as to the instrument actually entered into, then relief from the judgment will not be granted.
The satisfaction of judgment entered in the present case accurately represented the intention of the parties. The so-called mistake complained of by plaintiff related only to plaintiff’s method of computing the interest; an extrinsic fact. Moreover, at the time that the parties computed the interest and agreed upon the amount, their computation was not incorrect.
Finally, we do not believe that the failure to set aside the satisfaction of judgment will result in a substantial injustice. Plaintiff’s attorney was obviously aware of the computation method applied and apparently selected it. If MCL 600.6013; MSA 27A.6013 was previously open to interpretation, plaintiff’s counsel could have just as easily selected the alternate method, but apparently chose not to do so. Plaintiff, by executing the satisfaction of judgment, acknowledged the method of computation, affirmed the calculation and gave an aura of finality to the transaction. No substantial injustice is visited upon plaintiff by now requiring her to abide by the terms of the judgment which she knowingly accepted. For these reasons, there was no abuse of discretion in the trial court’s denial of the motion to set aside the satisfaction of judgment.
Plaintiff also argues that since Gage did not create new law, but merely interpreted a pre-existing statute, its application is not controlled by the considerations which typically determine retroactive application. While it may be said that Gage did not create a new rule of law, as that term is typically understood, it did resolve an ambiguity in the law which had previously led trial courts to interpret the statute in contrary and inconsistent ways. In Gage, the Court said that "[t]he statute is clearly open to either construction”, thereby negating plaintiff’s contention that the contrary conclusion was incorrect even prior to Gage. If Gage did not constitute new law, it was clearly a departure from many of the earlier cases, and it should not be retroactively applied absent consideration of its effect on the parties and the administration of justice.
Three considerations are often applied to control retroactivity: (1) the purpose of the new rule, (2) the litigants’ reliance on the old rule, and (3) the impact of the rule on the administration of justice. Consideration of the third factor alone militates in favor of denying the retroactive application of Gage to the present case. As the trial court noted, if Gage were to be applied to cases in which a satisfaction of judgment had already been executed, ”[w]e could have 10,000 people coming back here and asking the court to change their judgments”. The court’s concern is not without basis. The application of Gage to an action which is no longer pending could well open the floodgates to other litigants eager to increase their recovery and could lead to disasterous results in relation to matters properly considered closed.
Moreover, even if retroactive application was deemed fitting, it would not extend to cases in which the cause of action is no longer pending. Normally, application of a new rule of law falls within one of three categories. A new rule of law may be (1) applied in all cases in which a cause of action has accrued and which are still lawfully pending, plus all future cases, (2) applied to the case at bar and all future cases, or (3) applied only to future cases. Even the most far reaching category would not encompass the present case. We believe it is clear that retroactive application of Gage would be inappropriate in the present case.
Last, it should be remembered that traditionally the filing of a satisfaction of judgment is understood to have a finality about it and this is deservedly so. In the practice, experienced lawyers know that the last and final step in a case is the filing of a satisfaction of judgment. Cases should at some point have a finality about them. Appeals should not be endless. The filing of a satisfaction of judgment is and should be the mark of finality.
Affirmed.
122 Mich App 699; 332 NW2d 474 (1983), lv den 417 Mich 1100.37 (1983).
133 Mich App 366; 350 NW2d 257 (1984), lv gtd 422 Mich 873 (1985).
GCR 1963, 528.3(1), now MCR 2.612(C)(1)(a).
Lark v Detroit Edison Co, 99 Mich App 280, 282-283; 297 NW2d 653 (1980), lv den 410 Mich 906 (1981).
135 Mich App 702, 711; 355 NW2d 661 (1984).
Schwartz v Piper Aircraft Corp, 90 Mich App 324; 282 NW2d 306 (1979).
Gage, supra, p 373.
Thompson v Thompson, 112 Mich App 116, 120; 315 NW2d 555 (1982).
Placek v Sterling Heights, 405 Mich 638, 662; 275 NW2d 511 (1979), reh den 406 Mich 1119 (1979). | [
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T. L. Brown, J.
Plaintiff commenced this action against defendants based on theories of common-law negligence, intentional infliction of emotional distress, and 42 USC 1983 and 1985. Plaintiff seeks to recover for damages she suffered on August 6, 1980, as a result of being raped by a resident, Troy Williams, of defendant Starr Commonwealth for Boys (Starr), while she was employed by Starr. The trial court summarily disposed of all of plaintiff’s claims except for the claim of intentional infliction of emotional distress against defendants Ness, McCauley and Barthel, who were employed by Starr at the time of this incident. The trial judge also denied plaintiff’s motion to file a second amended complaint to assert a claim under 42 USC 1983 and 1985. Plaintiff appeals as of right.
I
Plaintiff argues that the trial court erred by granting summary judgment under GCR 1963, 117.2(1) in favor of defendants Porter, Mixon, Whittington, Katzman, Patterson, and Little on plaintiff’s claims of common-law negligence based on governmental immunity. A motion based on GCR 1963, 117.2(1) [now MCR 2.116(C)(8)] for fail ure to state a claim is to be tested by the pleadings alone and tests the legal basis of the complaint, not whether it can be factually supported. Unless a claim is so clearly unenforceable as a matter of law that no factual development can possible justify a right to recover, a motion under this subrule should be denied. Partrich v Muscat, 84 Mich App 724, 729-730; 270 NW2d 506 (1978).
In her complaint, plaintiff averred that Troy Williams was placed in the custody of the Michigan Department of Social Services (DSS) by the probate court after the court determined that Williams had committed second-degree criminal sexual conduct. Defendant Porter, a DSS employee, processed an exception request to allow Williams to be placed at defendant Starr. Porter’s supervisors, defendants Mixon, Whittington, Katzman, Patterson, and Little, approved the exception request. According to plaintiff, they failed to follow DSS regulations which required placement of Williams at a facility other than Starr. Plaintiff alleged that Porter negligently processed the exception request for Williams in that Porter failed to obtain full information on Williams and include that information in the exception request and that defendants Mixon, Wittington, Katzman, Patterson, and Little negligently permitted the exception request to be approved.
The trial court held that the State-employed defendants are immune from liability for the common-law claims of negligence as they were acting within the scope of their employment in carrying out a governmental function in deciding to place Williams at Starr. At the time of the trial court’s ruling, there was a split of authority on whether the "discretionary/ministerial” or the "scope of employment” test was the proper standard to apply when determining whether government em ployees are immune from tort actions. In Ross v Consumers Power Co (On Rehearing), 420 Mich 567, 633-634; 363 NW2d 641 (1984), the Supreme Court rejected the scope of employment test and adopted the discretionary/ministerial test for determining individual immunity. Under this test, the Supreme Court set forth the following parameters:
"Judges, legislators, and the highest executive officials of all levels of government are absolutely immune from all tort liability whenever they are acting within their respective judicial, legislative or executive authority. Lower level officers, employees, and agents are immune from tort liability only when they are
"a) acting during the course of their employment and are acting, or reasonable believe they are acting, within the scope of their authority;
"b) acting in good faith; and
"c) performing discretionary-decisional, as opposed to ministerial-operational, acts.” 420 Mich 592.
In defining discretionary and ministerial acts, the Court transformed these words into the hyphenated "discretionary-decisional” and "ministerial-operational” form. If a particular activity involves personal deliberation, decision, and judgment, it will be considered a discretionary act for which an employee will be immune from tort liability. On the other hand, the execution or implementation of a decision is considered a ministerial act which, if performed in a tortious manner, will result in liability. 420 Mich 634-635.
We conclude that, although the decision to place Williams at Starr was a discretionary one, defendant Porter’s acts of placing the proper information on the request form and assuring that adequate information was acquired in processing the exception request were ministerial acts. Moreover, plaintiff does not allege that defendants Mixon, Whittington, Katzman, Patterson, and Little, individually, made a decision that Williams should be placed at Starr. Rather, plaintiff alleges that, under established DSS policy, defendants had no discretion to approve the exception request to send Williams to Starr. The failure to follow established procedures in supervising employees is a ministerial act. Bandfield v Wood, 421 Mich 774; 364 NW2d 280 (1985). Consequently, we also conclude that plaintiff’s allegations that the individual state-employed defendants failed to follow established DSS procedures are sufficient to withstand summary judgment under GCR 1963, 117.2(1). Based on the foregoing, summary judgment for the individual state-employed defendants is, therefore, reversed.
II
Plaintiff also contends that the trial court erred in granting accelerated judgment under GCR 1963, 116.1(5) to Starr and Starr-employed defendants Ness, McCauley, and Barthel as to her claim of common-law negligence based on the exclusive-remedy provision of the Worker’s Disability Compensation Act (WDCA), MCL 418.131; MSA 17.237(131). Plaintiff argues that the exclusivity provision of the WDCA does not apply because the rape did not arise out of her employment, but out of Starr’s breach of its common-law duty to keep its premises safe. Moreover, plaintiff also argues that the exclusivity provision does not apply because plaintiff was not entitled to workers’ compensation since she was not incapacitated from earning full wages for at least one week.
The trial judge’s conclusion that the exclusive remedy provision of the WDCA bars plaintiff’s negligence action is supported by McKinley v Holiday Inn, 115 Mich App 160; 320 NW2d 329 (1982), lv den 417 Mich 890 (1983). Although plaintiff does not allege that the rape occurred while in the course of her employment but while she was "lawfully on the premises” of Starr, there is no dispute that her personal injuries were sustained during working hours and while plaintiff was performing the duties for which she was employed by Starr. As in McKinley, where the plaintiff while working as a maid at the Holiday Inn was assaulted and raped by one of the guests at the motel, the rape of plaintiff arose during the course of her employment. This makes the WDCA plaintiff’s exclusive remedy against defendant Starr. The fact that a plaintiff may not actually be entitled to receive compensation benefits does not give her the right to maintain a common-law action. McKinley, supra, pp 162-163.
Plaintiff’s claims of common-law negligence against the individual Starr-employed defendants are also barred because the acts and omissions of these defendants complained of by plaintiff occurred during the course of their employment. See Schwartz v Golden, 126 Mich App 790; 338 NW2d 218 (1983). Consequently, the trial judge’s award of accelerated judgment in favor of Starr and the Starr-employed defendants on plaintiff’s claims of common-law negligence is affirmed.
Ill
Plaintiff contends that the trial judge erred in granting summary judgment under GCR 1963, 117.2(1) on her claim under 42 USC 1983. Plaintiff alleges violations of her rights to liberty, privacy, travel, and other rights guaranteed under the United States Constitution.
Plaintiff argues that the first amended complaint alleged sufficient facts to indicate that Starr and the Starr-employed defendants were reckless, grossly negligent, or acted with deliberate and conscious indifference to plaintiff’s rights by accepting Willimas at Starr and failing to maintain proper control over him even though they knew of his numerous acts of volence and assault, especially toward females. Plaintiff further argues that defendant Starr is liable for the actions of its employees under the doctrine of respondeat superior.
42 USC 1983 creates a cause of action for persons who have been deprived of their rights, privileges and immunities under the federal law against the person who has so deprived them when acting under color of state law. In Parratt v Taylor, 451 US 527, 535; 101 S Ct 1908; 68 L Ed 2d 420 (1981), the United States Supreme Court broke the statute down into two essential elements: (1) the conduct complained of must have been committed by a person acting under color of state law; and (2) the conduct must have deprived the complaining person of rights, privileges or immunity secured by the constitution or laws of the United States.
Starr is a private corporation which provides housing and supervision for young men who are in the custody of the DSS for violating the state’s juvenile code. A private entity will be considered to have acted under color of state law for the purposes of 42 USC 1983 if it is performing a function which is essentially and traditionally public. Perex v Sugarman, 499 F2d 761, 765 (CA 2, 1974). In the present case, as in Perez, where private child-caring institutions were considered to be acting under color of state law, Starr and its employees were acting under color of state law.
The statute (42 USC 1983) does not specifically set forth the requirement that the wrongdoer have a certain state of mind. The statute does not limit its application solely to intentional deprivations of constitutional rights. Parratt, 451 US 535. However, the alleged wrongdoer’s state of mind has been considered relevant in determining whether a federal constitutional right has been violated. For instance, in Estelle v Gamble, 429 US 97; 97 S Ct 285; 50 L Ed 2d 251 (1976), the United States Supreme Court considered the culpability of prison officials relevant in determining whether a prisoner who was given inadequate medical treatment had been subjected to cruel and unusual punishment in violation of US Const, Am VIII. In Estelle, the Court reasoned that negligent medical treatment of a prisoner does not state a valid claim of cruel and unusual punishment. However, if the prisoner alleges "acts or omissions sufficiently harmful to evidence delibrerate indifference to serious medical needs”, the allegations will support a claim that the Eighth Amendment has been violated. Estelle, 429 US 106.
In Doe v New York City Dep’t of Social Services, 649 F2d 134, 141 (CA 2, 1981), it was held that, to impose liability upon a social services agency for failing to prevent sexual abuse of the plaintiff, she had to show that the agency acted with deliberate indifference to her rights. In Gullatte v Potts, 654 F2d 1007 (CA 5, 1981), the deliberate or reckless indifference standard was explained as requiring that the defendant:
"either actually intended to do harm to the plaintiff, or took an action which, although not intended to do harm, was so likely to produce injury that the harm can be characterized as substantially certain to result.” Gullatte, supra, p 1013, citing Bogard v Cook, 586 F2d 399, 412 (CA 5, 1978).
A motion for summary judgment under GCR 1963, 117.2(1) tests the legal sufficiency of the pleadings. If the claim is so unenforceable as a matter of law that no factual development could justify recovery, the motion should be granted. Romeo v Van Otterloo, 117 Mich App 333, 337; 323 NW2d 693 (1982). Plaintiff, in her complaint, does not allege that Starr or its employees acted with deliberate or reckless indifference to plaintiff’s federal constitutional rights. Plaintiff claims that Starr and its employees became aware that Williams could not be controlled, that he was violent and that he presented a threat to the physical well-being of the people around him. Plaintiff further claims that defendants knew that Williams was committed to their custody because of criminal sexual conduct and that, in spite of their knowledge of his potential for violence, his background of sexual assault, and their inability to control him, defendant Barthel, who was charged to guard Williams, left him unattended. This is not sufficient to support a finding that these defendants acted with deliberate indifference, that they actually intended to harm the plaintiff, or that the action they took was substantially certain to result in the injury that occurred. Gullatte, supra. Thus, the trial judge’s award of summary judgment to Starr and its employees pursuant to GCR 1963, 117.2(1), as to the civil rights claims is affirmed.
Plaintiff also argues that the trial court erroneously granted summary judgment to the state-employed defendants as to plaintiff’s claim under 42 USC 1983. Plaintiff contends that these defendants deliberately or recklessly disregarded plaintiff’s rights by permitting Williams to be placed at Starr without obtaining complete information on him and contrary to DSS policy. Plaintiff further contends that these defendants knew of should have known that Starr would not be able to control Williams and that he was a threat because of his history of violent and assaultive behavior.
The alleged failure of the state-employed defendants to follow the state’s rules and regulations does not constitute a deprivation of plaintiff’s federal rights. Gryger v Burke, 334 US 728; 68 S Ct 1256; 92 L Ed 1683 (1948); Snowden V Huges, 321 US 1; 64 S Ct 397; 88 L Ed 497 (1944). Defendants must have acted with deliberate or reckless indifference to plaintiffs federal constitutional rights in placing Williams at Starr to be held liable under 42 USC 1983.
The cases of Westlake v Lucas, 537 F2d 857 (CA 6, 1976), and Redmond v Baxley, 475 F Supp 1111 (ED Mich, 1979), involved defendants who were much more culpable than the state-employed defendants in this case. Although direct involvement in an assault is not necessary, Redmond, supra, p 1115, the proximity of a defendant to the actual assault is relevant to determining whether he has sufficient culpability. The more involvement the defendant has with the assailant, the more knowledge and ability to prevent the assault he has. In Redmond, the Director of the State Department of Corrections, who had been the warden of the prison where the plaintiff inmate was raped, had knowledge of numerous complaints of rape in the prison’s infirmary, where the rape of the plaintiff occurred. In addition, he had knowledge of the inadequacy of the security at the infirmary. These facts were sufficient to show that the rape was substantially likely to occur. In contrast, the facts alleged by plaintiff do not indicate it was substantially likely that Williams would commit a rape. His case history, although indicative of a possibility that he would commit a sexual assault, did not indicate that an assault was substantially likely to occur. Similarly, in Westlake, supra, the prisoner was denied medical treatment even though there was an obvious need for such treatment. In that case, the harm to the prisoner was substantially likely to occur. However, in the present case, the facts do not indicate that the state-employed defendants should have known that a sexual assault by Williams was substantially likely to occur.
Accordingly, the trial judge’s award of summary judgment to the state-employed defendants on plaintiffs claim under 42 USC 1983 is affirmed.
IV
Plaintiff contends that the trial court improperly denied her motion to file a second amended complaint. A trial court’s denial of a motion to amend pleadings should not be reversed unless there has been an abuse of discretion. Cobb v Mid-Continent Telephone Service Corp, 90 Mich App 349, 353; 282 NW2d 317 (1979). While GCR 1963, 118.1 provides that leave to amend pleadings "shall be freely given when justice so requires”, leave to amend need not be granted if amendment would be futile. Ben P Fyke & Sons v Gunter Co. 390 Mich 649, 660; 213 NW 2d 134 (1973).
In her proposed second amended complaint, plaintiff did not include any additional factual allegations to support the conclusory statements that defendants acted with deliberate and reckless indifference to plaintiff’s rights by placing Williams at Starr. Because this state of mind is necessary to constitute the deprivation of a federal constitutional right, the facts showing that the wrongdoer had this degree of culpability must be set forth with specificity. Gittlemacker v Prasse, 428 F2d 1 (CA 3, 1970). The facts alleged by plaintiff do not sufficiently state a cause of action because they do not indicate that defendants were acting with deliberate or reckless indifference to plaintiff’s rights. The facts alleged indicate only ordinary negligence and do not state facts which constitute deliberate or reckless indifference to plaintiff’s rights. Because the proposed second amended complaint does not state a valid cause of action under 42 USC 1983, the filing would have been futile and the trial judge properly denied plaintiff’s motion for leave to file the second amended complaint.
The trial court’s orders are affirmed in part and reversed in part. The case is remanded to the trial court for further proceedings on plaintiff’s claims of intentional infliction of emotional distress against Starr-employed defendants Ness, McCauley and Barthel, and on plaintiff’s claims of common-law negligence against state-employed defendants Porter, Mixon, Whittington, Katzman, Patterson and Little.
Affirmed in part, reversed in part, and remanded. | [
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Per Curiam.
Defendant appeals by leave granted from an order denying its motion for summary judgment on plaintiff’s claim for no-fault benefits. We reverse and remand for entry of judgment consistent with this opinion.
The present ease arises out of defendant’s refusal to pay no-fault benefits under a no-fault policy issued to plaintiff’s stepfather, Robert Elkins, for injuries sustained by plaintiff on February 13, 1982. On that date, at approximately 5:00 p.m., plaintiff, then 12 years old, was at the home of a friend when the two boys decided to go snow mobiling. The snowmobile was not functioning properly, so the boys turned it over on its side in order to ascertain what was causing the problem. They discovered that the track on the bottom of the machine was completely jammed with ice. Plaintiff tried to dislodge the ice by hitting the track with his fist. While plaintiff was hitting the track, the other boy went to the other side of the snowmobile and, instead of turning the engine off as plaintiff expected, the boy "gunned” the engine, catching the tip of plaintiffs glove in the track and pulling his right hand and arm into the machine. Plaintiff sustained injuries requiring a one-month stay in the hospital.
On June 11, 1982, plaintiffs stepfather, Robert Elkins, as plaintiffs next friend, filed a complaint for the recovery of no-fault medical insurance benefits. The complaint alleged that, as of the date of the accident, plaintiff was covered by Elkins’s insurance policy with Allstate. According to plaintiff, Allstate failed or otherwise refused to pay plaintiffs hospital and medical costs, as required under the policy and under Michigan’s no-fault act. The complaint requested that the trial court issue a declaratory judgment to the effect that defendant had a duty to provide plaintiff with benefits to cover all reasonable and necessary expenses related to and arising out of his injuries.
Defendant moved for summary judgment pursuant to GCR 1963, 117.2(1) and (3) [now MCR 2.116(c)(8) and (10)], arguing that a snowmobile is not a "motor vehicle” within the meaning of § 3101(2)(c) of the no-fault act. MCL 500.3101(2)(c); MSA 24.13101(2)(c). Defendant concluded that, because plaintiff was not injured while operating a "motor vehicle”, he was not entitled to benefits under the no-fault act as a matter of law. There is no dispute that plaintiffs stepfather was insured by defendant at the time of the accident or that the policy extends coverage to plaintiff for injuries caused by the use of a motor vehicle as a motor vehicle.
The trial court treated the motion for summary judgment as one brought solely under GCR 1963, 117.2(1) and held that a snowmobile was designed for operation on a public highway and was, thus, a motor vehicle. Defendant moved for rehearing, which motion was denied.
At the hearing on its motion, defendant argued that in order to be a motor vehicle under the no-fault act, a snowmobile would have to have more than two wheels and be designed for use primarily on the highway, neither of which applied here. Plaintiff argued that the more-than-two-wheel requirement should not be applied to snowmobiles inasmuch as the requirement was intended by the Legislature only to exclude motorcycles from the definition of motor vehicles. Plaintiff further stated that, since there were some instances in which a snowmobile could legally be operated on a public highway, a snowmobile was a motor vehicle within the statutory definition. On appeal, defendant posits the same arguments in support of its position.
A motion for summary judgment based upon GCR 1963, 117.2(1) tests the legal sufficiency of the pleadings. The trial court, when ruling on such a motion, must accept as true all well-pled facts in the complaint. "[A] mere statement of conclusions, without factual allegations to support them, will not suffice to state a cause of action or survive a motion for summary judgment.” Zaschak v Traverse Corp, 123 Mich App 126, 128; 333 NW2d 191 (1983). In order to state a valid claim for no-fault benefits, plaintiff was required to plead facts sufficient to establish that his injuries arose out of the use of a "motor vehicle” as a motor vehicle. Section 3101(2)(c) of the act contains the following definition of "motor vehicle”:
" 'Motor vehicle’ means a vehicle, including a trailer, operated or designed for operation upon a public highway by power other than muscular power which has more than 2 wheels. Motor vehicle does not include a motorcycle or a moped, as defined in § 32b of Act No. 300 of the Public Acts of 1949.” MCL 500.3101(2)(c); MSA 24.13101(2)(c).
As is clear from the statutory language, in order to come within the above definition, a vehicle must be operated or designed for operation upon a public highway, be powered by a source other than muscular power, and have more than two wheels. Apperson v Citizens Mutual Ins Co, 130 Mich App 799, 801; 344 NW2d 812 (1983).
The appellate courts of this state have not yet determined whether a snowmobile is a "motor vehicle” under § 3101(2)(c) of the act. As a starting point, we note here that the snowmobile was not, in fact, operated upon a public highway, so that our first inquiry is whether it was designed for operation upon a public highway.
In Ebernickel v State Farm Mutual Automobile Ins Co, 141 Mich App 729; 367 NW2d 444 (1985), the plaintiff was injured at his place of employment when he was struck from behind by a "hi-lo”. The machine had an engine, four wheels, lights and an exhaust system. It was capable of being driven on a highway. This Court ruled that the hi-lo was not a motor vehicle because it was not "primarily designed for operation on a public highway” at the time of the accident. 141 Mich App 731. (Emphasis added.) In discussing the requirement that the machine be primarily designed for highway use, the Ebernickel Court stated that the fact that the machine could be operated on a highway or had been previously operated on a highway was of no consequence. Compare Apperson, supra; Johnston v Hartford Ins Co, 131 Mich App 349; 346 NW2d 549 (1984), lv den, 419 Mich 893 (1984).
A snowmobile is not designed for primary use on public highways. "Snowmobile” is not defined in the no-fault act. It is, however, defined in the Motor Vehicle Code as follows:
" 'Snowmobile’ means any motor driven vehicle designed for travel primarily on snow or ice of a type which utilizes sled type runners or skis, or an endless belt tread or any combination of these or other similar means of contact with the surface upon which it is operated.” (Emphasis added.) MCL 257.1501(e); MSA 9.3200(l)(e).
Furthermore, it is illegal to drive a snowmobile on a public highway except under certain limited circumstances. Those circumstances include emergencies, special events of limited duration where proper permits have been issued, crossing over roads to get to a different area and crossing over bridges and culverts where necessary. MCL 257.1512(b), (d), (f) and (g); MSA 9.3200(12)(b), (d), (f), and (g). Snowmobiles may also be operated on non-snowplowed country roads outside the corporate limits of a city or village where such a road is designated and marked for snowmobile use by the county road commission. MCL 257.1512(e); MSA 9.3200(12)(e).
While snowmobiles are designed so that under some circumstances they can be used on public highways, the ability at some point to use the snowmobile on a road does not indicate that the vehicle was "designed” to be operated on a road. As in Ebernickel, supra, we look to whether the vehicle was primarily designed to operate upon a public highway. Because MCL 257.1512; MSA 9.3200(12) "primarily” prohibits the use of snowmobiles on public highways, we hold that such vehicles are not motor vehicles within the meaning of § 3101(2)(c). The fact that snowmobiles may operate on the right-of-way portion of a public highway ["that portion of a highway * * * less the roadway and any shoulder”, MCI 257.1501(j); MSA 9.3200(l)(j)] does not, contrary to plaintiffs contention, make a snowmobile primarily designed for operation on a public highway. Snowmobiles are more properly considered off-the-road vehicles. Compare DAIIE v Spafford, 76 Mich App 85, 89; 255 NW2d 780 (1977), lv den 402 Mich 825 (1977). Our disposition of this issue makes it unnecessary to address plaintiffs contention that a snowmobile has more than two wheels within the meaning of § 3101(2)(c).
Reversed and remanded for entry of judgment in favor of defendant. | [
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] |
Clark, J.
Plaintiff, trustee in a mortgage securing an issue of bonds in the sum of $250,000, filed bill of foreclosure and had decree on January 6, 1931. At the sale the property was bid in by the trustee. The sale was confirmed. The date of expiration of the period for redemption was October 10, 1931.
For nearly four years there had been pending a proceeding in condemnation, involving- this and many other parcels of land, by the city of Detroit, for the widening of Woodward avenue. Just before the expiring of the period of redemption, defendants filed motion to modify the decree by extending the period of redemption. The ground of the motion is an alleged prospect of completing the condemnation proceeding, in which a large part of the mortgaged premises will be taken and a consequent award of compensation made. Defendants propose to use the amount of the award in reduction of the mortgage debt, and although, there will be corresponding reduction in mortgage security, they express, without convincing particulars, hope, or perhaps belief, that they may raise sufficient funds to pay remainder of the mortgage debt. The time of such extension was not and could not be stated certainly. When the motion was made,'it was not known when, if ever, funds would be available from the proceeding on condemnation. It is said in a brief that judgment in condemnation was entered on July 21,1932, and awards may be paid on or before July 21,1933.
The motion was denied. Defendants have appealed.
A general rule is stated in Wood v. Button, 205 Mich. 692, quoting syllabus: ■
“The right to redeem from a foreclosure at law is a legal right created by the statute, and can neither be enlarged nor abridged by the courts.”
And see 42 C. J. p. 355.
This general rule is subject to exception.. Equity may relieve in cases of fraud, accident, or mistake. Palmer v. Palmer, 194 Mich. 79; 42 C. J. p. 393, and cases cited. Here there was no fraud,' no conduct on the part of the mortgagee to induce or persuade the owners not to redeem in time, and there was no accident, no mistake. Defendants merely try to keep open for a long and indefinite period the right to redeem and until the litigated matter, the condemnation proceeding, shall have been determined and on the outcome of such litigation the doubtful advantage of redeeming depends. The condemnation may produce some money, but it works a cor responding reduction in security. The . circumstances give no ground in equity for enlarging the right to redeem.
In this view we need not discuss the contention that defendants with their petition seeking equitable relief make no proper offer or showing of willingness to do equity within Tuller v. Detroit Trust Co., 259 Mich. 670.
Affirmed, with costs.
McDonald, C. J., and Potter, Sharpe, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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Sharpe, J.
The bill of complaint in this case was filed to secure the partition of 40 acres of land in the county of Midland under 3 Comp. Laws 1929, § 14995 et seq. Plaintiffs claim that they together own an undivided one-third interest therein, and that the defendants own the other two-thirds. The defendants deny that plaintiffs have any interest therein, and by cross-bill seek to have the conveyances under which plaintiffs claim declared void and removed as a cloud upon their title.
The records in the office of the register of deeds disclose that the title rested in Samuel I. Harrison on March 27, 1902.
Plaintiffs’ Record Title.
Deed, Samuel I. Harrison and wife to David E. Harrison, undivided one-half interest, dated March 27, 1902, recorded February 12, 1903.
Assignment of residue of David E. Harrison estate to Regina K. Harrison, his widow, and children, Don E. and Hazel 0., recorded November 24, 1928.
Don E. Harrison to E. E. Robinson, quitclaim, dated August 22, 1931, recorded August 25, 1931.
E. E. Robinson to Gr. M. Porter, quitclaim, dated September 17, 1931, recorded September 26, 1931.
Hazel O. Strong, née Harrison, to Gr. M. Porter, quitclaim, dated August 22, 1931, recorded September 3, 1931.
G. M. Porter and wife to Delbert Fortney, warranty deed of undivided one-third interest, dated September 17, 1931, recorded September 26, 1931.
Defendants’ Record Title.
Samuel I. Harrison and wife to Regina K. Harrison, the wife of his brother David, quitclaim of en tire 40, dated July 31, 1905, recorded October 12, 1905.
Regina K. Harrison to P. J. Gruber, warranty deed, dated October 19, 1911, recorded March 18, 1912.
P. J. Gruber and wife to William H. Tats and Millie Yats, his wife, warranty deed, dated January 12, 1915, recorded January 13, 1915.
William H. and Millie Yats to Joseph Grover, warranty deed, dated October 29, 1915, recorded November 11, 1915.
Myra and Marion Grover, as sole heirs-at-law of Joseph Grover, to Robert L. Tope, defendant, quitclaim, dated August 17, 1931, recorded August 19, 1931.
After submission of the proofs, the trial court found that plaintiffs collectively were the owners of a one-third interest in said land, and that the defendants were the owners of the remaining two-thirds. He further found that partition between the plaintiffs and defendants should be had “by metes and bounds;” the plaintiffs’ one-third to be set apart “in square form.” The decree entered pursuant to such finding provided:
‘ ‘ That partition of said premises shall be made in kind by commissioners hereafter appointed by this court pursuant to the statute in such case made and provided, said commissioners allotting to said plaintiffs, quality and quantity relatively considered, one-third of said land, said commissioners designating the parcel so allotted to said plaintiffs by permanent monuments pursuant to the statute, and if found equitable and practical, such commissioners shall parcel out such parcel passing to said plaintiffs in square form and make report to this court of their findings and doings in the premises pursuant to the statute in such case made and provided.”
The defendants by cross-bill prayed that Eunice E. Robinson,- Gr. M. Porter, and H. J. Mulder be made parties plaintiff and that they and the plaintiffs be decreed to be liable to the defendants for their “unlawful and fraudulent acts” in hindering and delaying the defendants in the development of their property. An order was entered making these parties plaintiffs, and an answer to the cross-bill was filed by them and the other plaintiffs. In its decree the court dismissed the cross-bill. The defendants have appealed.
By deed from Samuel I. Harrison, his brother David acquired a one-half interest in this land in 1902, and his wife, Regina K., by deed acquired the other one-half interest in 1905, and they were the owners thereof as tenants in common until 1911, when Regina, by warranty deed, conveyed the entire interest therein to Gruber, although she then owned but a one-half interest.
Defendants’ counsel seem to concede that under the record of conveyances the plaintiffs are the owners of an undivided oné-third interest in this land. They state the question involved in this respect to be: Were the plaintiffs — ■
“or any of them, bona fide purchasers and legal owners of a one-third interest, as tenants in common, in the 40 acres in question?”
They rely on the rule of law as stated in 39 Cyc. p. 1687:
“The essential elements of a ‘bona fide purchase’ of land are: (1) The payment of a valuable consideration; (2) good faith and absence of purpose to take an unfair advantage of third persons; and (3) absence of notice, actual or constructive, of outstanding rights of others.”
And in 20 R. C. L. p. 346:
“Whatever fairly puts a person on inquiry is sufficient notice, where the means of knowledge are at hand; and if he omits to inquire, he is then chargeable with all the facts which, by a proper inquiry, he might have ascertained. This, in effect, means that notice of facts which would lead an ordinarily prudent man to make an examination which, if made, would disclose the existence of other facts is sufficient notice of such other facts. A person has no right «to shut his eyes or his ears to avoid information, and then say that he had no notice; he does wrong not to heed the ‘signs and signals’ seen by him. It will not do to remain wilfully ignorant of a thing readily ascertainable. ’ ’
It appears that in the spring of 1931 oil was discovered on property about a mile and a half distant from this 40, and there- was much activity in securing titles to, or leases of, nearby lands. The plaintiff Fortney and the defendants Tope and Talbot were interested. Fortney was then acting as superintendent for the Columbia Oil & Gas Company. He testified that on September 12, 1931, he met G. M. Porter in the office of the register of deeds in Midland and had some talk about the one-third interest Porter claimed to have in this 40 acres; that as a result thereof a written agreement was prepared and executed wherein he agreed to pay Porter $1,500 therefor; that Porter agreed “to furnish a merchantable abstract certified to date, including tax statements of said premises;” that he at that time gave Porter his check for $100 and $300 in cash; that Porter furnished him an abstract of title to the 40 acres certified to September 16th; that he took it to Carl Holbrook, an attorney at Clare, and on September 21st received a written opinion from him thereon, and that he later got a warranty deed from Porter and paid him the balance due therefor. There was objection to the written opinion of Mr. Holbrook as to the title, but it was received in evidence. He stated therein that Porter and E. E. Robinson each owned an undivided one-sixth interest in the property, and that Tope apparently owned the balance thereof. The deed from Robinson to Porter had not then been recorded.
Defendants rely on the fact that the deeds recorded as shown by the abstract Ahich purported to convey the entire title for so many years “should have attracted the attention and aroused the suspicion” of the purchasers of this undivided interest. Had not the abstract shown that the grantor, Samuel I. Harrison, under whose title all parties claim, himself created a divided interest in the land by his conveyance of an undivided half thereof to his brother on March 27, 1902, and thereafter but quitclaimed his interest therein to his brother’s wife on July 31, 1905, a different question would be presented. There are, we think, few persons unfamiliar with abstracts of land who are willing to rely on their own judgment as to the sufficiency of a vendor’s title thereto. They very properly submit the abstract to an attorney, and, if prudent, do just as Fortney did, require a written opinion thereon. Mr. Holbrook had practiced law at Clare for 10 years, during most of which time he had been prosecuting attorney of the county. His integrity is not questioned. He had the abstract in his hands for several days, and testified that in his judgment the report made to Fortney was justified by the entries thereon.
This 40 acres was wild and uncultivated. There was no one living on it. It apparently had little value until land in the vicinity began producing oil. Taxes for the years 1919 to 192.4 had become delinquent, and sale had therefor in 1929. It appears that Mr. Tope had secured a conveyance from the purchaser, paying him $1,250 therefor. No reliance is placed upon the effect of this deed. He also paid the heirs of Joseph Grover $100 for their interests in the property. It also appears that he had secured an abstract of title to the land, but it does not appear that he submitted it to an attorney for an opinion thereon. Had he done so, it seems probable that a doubt would have been expressed as to whether the' quitclaim from the Grover heirs conveyed the entire interest in the land, as it assumed to do.
Much parol evidence was submitted, but so far as it bears upon the issue under consideration it was so contradictory as to have but little weight. In our opinion tbe record sustains the finding of the trial court “that the plaintiffs were good-faith purchasers in the land in question.”
This suit was brought for partition. 3 Comp. Laws 1929, § 14996, reads, in part, as follows:
“Any one or more of the persons so holding lands, may institute a suit in the circuit court for the county in which the lands lie, by a bill in equity, for a division, or partition thereof, according to the respective rights of the parties interested therein, and for the sale of such premises, if it shall appear that the partition thereof cannot be made without great prejudice to the owners.”
Defendants insist that partition will result in “great prejudice to the owners,” and in this we think they are right. It is apparent that this land is valuable for oil and gas; that the surface rights are of little value compared therewith. Mr. Fort ney, one of the plaintiff sj testified that in Ms judgment the 40 acres were -worth. $20,000. He also testified that, at the time of the hearing, in August, 1932, there were three producing wells near this land; two of them distant about 330 feet and the other about 500 feet.
In Mills & Willingham, Law of Oil & Gas, p. 272, it is said:
“Where it is known that the land bears oil and gas, following a similar rule applicable to solid minerals, it is generally held that there can be- no partition of the land by metes and bounds; that partition must be made by sale and division of the proceeds. And the same rule has been applied to partition of oil and gas leases.”
The rule thus stated is supported by decisions of the courts in States where the question has been presented. See Gulf Refining Co. v. Hayne, 138 La. 555 (70 South. 509, L. R. A. 1916 D, 1147, Ann. Cas. 1917 D, 130); Hall v. Vernon, 47 W. Va. 295 (34 S. E. 764, 49 L. R. A. 464, 81 Am. St. Rep. 791); Preston v. White, 57 W. Va. 278 (50 S. E. 236); Dangerfield v. Caldwell, 81 C. C. A. 400 (151 Fed. 554).
The injustice of a partition by metes and bounds is well stated in Gulf Refining Co. v. Hayne, supra (p. 561):
“It might be a most serious loss to one or more of the co-owners to divide a piece of oil land into three parts, and award one part to each.owner. A lot without oil under the surface falling to one co-owner would work incalculable damage to him to whom it was awarded, due entirely to the consequence of dividing the land. The courts cannot compel such a division or partition.”
Plaintiffs’ objection to a sale rests largely upon the claim that they are without funds to protect their interests, and defendants “doubtless would procure the interests of the plaintiffs at a mere pittance.” But a much greater injustice might be done if the parcel allotted to them be found to have no oil thereon and the remainder be productive. This 40 acres lies in the oil and gas field of that part of the State, and it seems clear that on a sale buyers will be present and the plaintiffs be assured of a reasonable price for their interest in the property.
The decree adjudging the plaintiffs to be the owners of an undivided one-third interest in the land is affirmed. The provision for its partition is reversed, and one may be here entered providing for a sale and remand to the circuit court to make provision therefor. No costs will be allowed.
McDonald, C. J., and Clark, North, Fead, Wiest, and Bittzel, JJ., concurred with Sharpe, J. | [
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Clark, J.
Plaintiff entered into a contract with defendant village to construct for it a well of certain dimension and capacity. He sued to recover on the theory that he had performed the contract. The defense is that he did not perform, chiefly in respect of filing bond and of capacity of well. The issue was submitted to a jury, who found for plaintiff. From judgment on verdict, defendant has appealed, contending that the verdict is against the great weight of the evidence, and that, therefore, the trial judge erred in denying a motion for new trial.
The issue is close but simple, and the evidence quite contradictory. We have no doubt the verdict was rendered upon comprehension of the facts. Nothing will be gained by stating them further. We are in accord with the trial judge.
Affirmed.
McDonald, C. J., and Potter, Sharpe, North, Fead, Wiest, and Butzel, JJ., concurred. | [
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] |
Sharpe, J.
The question first presented is whether the defendant corporation agreed to pay plaintiff the sum of $5,000 for his services in securing a man to make an investment in its company and relieve it from financial embarrassment. On trial without a jury, the court found that such agreement was made by the president of the defendant company. It also appears by a preponderance of the evidence that this agreement was ratified at a meeting of the stockholders at which all but two were present and proxies for these were in the possession of the secretary.
It is undisputed that at the solicitation of the plaintiff William T. Skrzycki became interested in the company and entered into a written agreement with it for the purchase of a part of its stock, whereby its financial difficulties were overcome. He is now a majority stockholder and in control of the com pany. It will serve no useful purpose to review the evidence submitted. It established the contract as claimed by plaintiff and performance on his part.
The defendant contends that plaintiff is estopped from recovering. This claim is based on the testimony of Skrzycld that in one of his conferences with the plaintiff before making* his contract, the following* conversation was had:
“I asked Mr. Began, ‘Now, who are you going to get any commission from, or what are you going to get? How are you going to get your pay for turning this deal?’ I don’t just remember. He said, ‘It won’t cost you a nickel.’ Well, I said, ‘You understand what I mean?’ ‘Yes,’ he says, ‘I do, it won’t cost you a nickel. ’
“Q. Was there any statement made at that time, that he was to get anything from the Consolidated Bakeries, or anybody else?
“A. No, not at that time. There was nothing said about him getting any money from the Consolidated Bakeries.”
Plaintiff testified that at one time Skrzycld asked him, “What will you charge me for handling this for me?” and that he answered, “Bill, I won’t charge you anything, because I am getting paid by the Consolidated Baking Company.”
Walter W. Wray, an accountant employed by Skrzycld to audit the books of the company prior to his purchase, testified that he found no entry therein of any indebtedness to the plaintiff. At this time there was no indebtedness as he had not yet earned his commission.
Bobert M. Kirby, who was employed by the company to audit its books after Skrzycld’s purchase, testified that when doing so plaintiff asked him “whether any provision had been made for a pay ment of $5,000 to him,” and that he answered “there had not, ’ ’ and that he afterwards spoke to Skrzycki about it. The plaintiff admitted that he made this inquiry and testified that Skrzycki afterwards came to him and said:
“ ‘Bill, you asked Mr. Kirby to' put the $5,000 through the books, that you have got coming?’ I said, ‘Yes.’ He said, ‘You know I want to borrow some money and I want to show a good statement to the bank.’ ”
Skrzycki admitted that he might have made such a statement. Alexander, the president of the company, testified that he told Skrzycki before his purchase that the company had agreed to pay plaintiff $5,000 for procuring additional capital. In view of this testimony, taken as a whole, the claim of estoppel is not well founded.
Defendant also urges that—
“The claim of the plaintiff was unenforceable as arising out of an alleged contract for the payment of commission for solicitation and inducement of the sale and purchase of corporate stock within the meaning of the ‘blue sky law.’ ”
The plaintiff was not engaged in the sale of securities as this term is used in that act (Act No. 220, Pub. Acts 1923 [2 Comp. Laws 1929, § 9769 et seep]). Under his contract with the company he secured a man able and willing to make an investment in the property of the company. He had nothing' to do with the sale of its stock or securities, and in no way violated the provisions of this act.
One of the questions involved is thus stated: “Was defendant’s motion for partial new trial properly heard and denied?”
The record discloses that such a motion was filed, based upon several affidavits annexed thereto. Two of these affidavits were made by stockholders of the company, and a third by a former stockholder. No sufficient excuse was offered why these affiants were not called as witnesses on the trial. We find no abuse of discretion on the part of the trial court in the denial of this motion.
The judgment is affirmed.
McDonald, C. J., and Clark, Potter, North, Pead, Wiest, and Btjtzel, JJ., concurred. | [
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] |
Butzel, J.
On April 27, 1928, August Galer and wife gave an oil and gas lease to certain lands in Mecosta county to one Lorenzo Mitchell. Plaintiffs claim that, without their knowledge and consent, the lease was materially altered after execution, either by Mitchell or by one I. H. Riebow. Mitchell assigned the lease to Don G. McAfee, defendant herein, and the assignment was recorded. The lease was for a term of five years, and provided that plaintiffs were to receive one-eighth of all oil produced and other considerations. It provided, however, for termination at the end of two years, unless lessee began drilling operations for gas and oil within that period. If drilling was not begun, the lease might be extended for 12-month periods upon payment of 25 cents a month for each acre of the property leased, payment to he made in advance on the first day of each month. Defendant did not begin operations as required, nor did he make any payments whatsoever.
On June 3,1931, plaintiffs filed a bill for reformation or cancellation of the lease and such other relief to which they might be entitled. After the hearing of the case, but before decree, defendant duly recorded a release of all his right, title, and interest under the lease, and thus removed the cloud upon the premises, in accordance with plaintiff’s hill of complaint. After the release was recorded by defendant, plaintiffs asked leave to amend their bill of complaint and prayed for recovery of $100 in liquidated damages as provided for under 3 Comp. Laws 1929, § 13507. The trial judge, holding that plaintiffs had waived reformation, granted leave. to amend their bill, and assessed damages of $100 and costs against defendant as provided by statute.
Defendant contends, - on appeal, that the judge erred in assessing the damages of $100; that in no event could it be exacted before plaintiffs made a demand for a release of the lease; and that the court should not have permitted plaintiffs to amend the bill of complaint after a release had been voluntarily filed by the defendant. Section 13506 provides a speedy method by which an oil and gas lease may be terminated of record without court procedure. Section 13507 provides a method in lieu of that described in section 13506, whereby suit may be-brought to secure a release and $100 as damages, plus any additional damages which may be proved. The statute does not require that demand for a release be made before bringing suit for damages. A lessor, claiming forfeiture of a lease, may proceed under either section.
There are somewhat similar statutes in other States affecting oil and gas leases. The New Mexico, Oklahoma, Montana, Louisiana, and Kansas statutes are almost identical with sections 13506 and 13507, supra, except that the former contain specific provisions requiring a demand as a condition precedent to a suit. Decisions from those States, therefore, are not applicable.
Defendant claims that the proceeding is analogous to that of a replevin suit, where demand is sometimes necessary. In replevin suits, however, the original possession may be lawful and becomes unlawful only after possession is demanded. When oil and gas leases are involved, the provisions are plain in regard to what constitutes a forfeiture, and the statute does not provide for a demand before suit may be begun and statutory damages exacted. Inasmuch as the law of this State seems to be modeled after those of other States where such a demand is necessary, we are led to the conclusion that the provision for a demand may have been purposely omitted.
When the present suit was begun, defendant had an opportunity to give a release. He knew that the suit was for the purpose of canceling the lease. He waited until after the hearing before executing such a release, and the trial, judge was correct in assessing $100 in damages, in accordance with the statute.
Under 3 Comp. Laws 1929, § 14144, the court had the power to give plaintiffs leave to amend the hill of complaint, even after the hearing, in order to protect the substantial rights of the parties and to secure the ends of justice. City Bank & Trust Co. v. Hurd, 179 Mich. 454; Hall v. Hall, 172 Mich. 210.
The decree of the lower court is affirmed, with costs.
McDonald, C. ■ J., and Clark, Potter, Sharpe, North, Fead, and Wiest, JJ., concurred. | [
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Fead, J.
This is a petition for declaratory judg- • ment upon construction of the constitutional amendment, article 10, § 21. Some of the questions were decided in School District of the City of Pontiac v. City of Pontiac, ante, 338. This case is concerned with the exception as to prior obligations and increase of the limitation by vote of the electors.
“Sec. 21. The total amount of taxes assessed against property for all purposes in any one year shall not exceed one and one-half per cent, of the assessed valuation of said property, except taxes levied for the payment of interest and principal on obligations heretofore incurred, which sums shall be separately assessed in all cases: Provided, that this limitation may be increased for a period of not to exceed five years at any one time, to not more than a total of five per cent, of the assessed valuation, by a two-thirds vote of the electors of any assessing district, or when provided for by the charter of a municipal corporation: Provided further, that this limitation shall not apply to taxes levied in the year 1932. ’ ’
The amendment unmistakably demonstrates a purpose to avoid impairment of contracts and to preserve all existing legislative power to levy taxes on property to pay existing debts. This continues in force, until changed by law, present authority in public bodies to spread taxes for such purpose.
Except for the requirement of separate assessment, the amendment does not repeal or modify any statutes governing the method of liquidation of “obligations heretofore incurred” nor restrict the legislature in the future enactment of laws for their orderly payment. Refunding or refinancing is not prohibited, expressly or by implication. Consequently, the important question in all instances is. whether a claim was a legal obligation of the public body when the amendment became effective. If it was, it is within the exception and may be paid by tax on property in such manner as may be permitted by law.
Direct refunding bonds issued in lieu of and exchanged for prior bonds in the same principal amount are a continuance of the obligation and within the exception.
Of the same effect are new bonds sold to pay existing bonds, the proceeds of which are actually used for that purpose, to the principal amount so paid.
Also within the exception are the renewal of notes or evidences of indebtedness before issued upon the faith of delinquent taxes, if and so far as, by law, they were also general obligations of the public body.
The power of the legislature, including present laws, to permit the levy of taxes on property to pay prior obligations, extends to the amount of the principal sum outstanding when the amendment took effect. Such principal sum cannot be increased by the sale of new bonds or exchange of refunding bonds at less than par. If the exigency of refinancing requires the issue of obligations at a discount, the difference must be absorbed by the municipality under its other powers, if any.
The exception also covers interest on outstanding obligations, but it does not confine such interest to the existing rate. If, then, issue of new evidences of indebtedness to continue existing obligations requires a different rate of interest, the amendment does not prohibit the levy of such rate on property.
It will be noted that the exception in the amendment permitting separate levy for payment of prior obligations applies only when the basic rate of one and one-half per cent, is exclusively operative. Where a municipality or district has increased or shall increase the basic rate of one and one-half per cent, by charter or vote under the proviso, the exception will not apply, and such municipality or district could not levy taxes on property to pay prior obligations in addition to the charter or voted rate, unless the charter or voted increase so provides.
Several other questions have been presented, which, however, are dependent upon special circumstances, and are purely local. For example, it appears that bonds had been voted before the amendment took effect but their sale and delivery had not been completed. The instances range from the mere voting of bonds to a binding contract of sale await ing only the printing of bonds for consummation. The Public Schools of the City of Muskegon, intervener, claims to be a chartered municipal corporation within the meaning of the amendment and entitled to the same powers declared in such corporations in the Pontiac Case because it was organized under a special statute. The people of the respective municipalities are interested in these questions. They are not parties to this proceeding. The questions are not within the purview of the case before us and must be left to a direct proceeding in which interested persons have án opportunity to be heard.
In the clause, “this limitation may be increased * * * by a two-thirds vote of the electors of any assessing district,” does “electors” mean all the electors of the district, the registered electors, or the electors voting on the proposition to increase the rate 1
In all other instances in which questions are submitted to the people under the Constitution the result is determined by the qualified electors voting-on the proposition. For example, the adoption of a law by initiative or referendum (article 5, § 1); adoption of local or special acts (article 5, § 30); organization of new counties (article 8, § 2); franchises to public utilities (article 8, § 25); adoption of county road system (article 8, § 26); organization of metropolitan districts (article 8, § 31); adoption of amendments to the Constitution (article 17, § 1); calling constitutional convention and adoption of Constitution (article 17, § 4). Uniformity of construction would impel a like rule on this amendment.
Ordinarily, the fact that different language is here used than elsewhere in the Constitution would prompt a different construction, because it would indicate a different intention. But this amendment is so generally confusing and careless of language that difference in words has no force of indication that a different rule was intended.
The provision is purely a local-option law, and it is contrary to our system of government to count electors on a question who are not sufficiently interested to vote.
There are practical difficulties to another construction. There is no public record of all the electors of any taxing district, nor means of ascertaining them except by census, which would be costly, subject to interested manipulation, and certainly inaccurate. Begistration of electors could not have been intended as test of the vote, because in some assessing districts, as school districts, there is no registration of electors. We hold that “electors” means those voting on the question.
To avoid misunderstanding, it is noted that we do not pass upon the effect of the amendment to article 3, § 4, contemporaneously adopted, in determining “electors” in the amendment at bar, because the question has not been presented.
Declaratory judgrtíent may be entered in accordance with this opinion.
McDonald, C. J., and Clark, Potter, Sharpe, North, Wiest, and Butzel, JJ., concurred. | [
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] |
Wiest, J.
Plaintiff corporation applied for registration as a dealer in malt products and as a distributor thereof under the provisions of Act No. 100, Pub. Acts 1931. Plaintiff operates many retail stores in this State and desires to sell at retail and distribute malt products. Defendant required a registration fee for each store. Thereupon plaintiff commenced this proceeding by writ of mandamus to test its right to a single registration as a dealer and a single registration as a distributor. The issue calls for construction of the act.
The act is entitled:
“An act to impose a privilege tax upon the sale, gift, exchange, barter, or distribution of malt syrup, malt extract, liquid malt, or wort in this State and motor vehicles used or operated for such purpose; to provide for the registration of all persons engaged in the business of selling or manufacturing of malt syrup, malt extract, liquid malt, or wort in this State and a fee therefor; to provide for the collection of such tax and fee and the appropriation of the proceeds therefrom.”
Applicable provisions of the act are as follows:
“No person shall engage in the business of selling qt retail malt syrup, malt extract, liquid malt, or wort unless he is the holder of a certificate of registration so to do issued as herein provided, which is still in effect. Such certificate of registration shall be issued by the secretary of State upon the filing of a written application as hereinafter provided, accompanied by a registration fee of twenty-five dollars. No person shall engage in the business defined herein as that of distributor of said articles unless he is the holder of a certificate of registration so to do issued as herein provided which shall be in effect. Such certificate of registration shall be issued by the secretary of State upon the filing of a written application therefor, accompanied by a registration fee of one hundred dollars. * * *' The secretary of State shall issue to each said person a certificate to be posted in each place of business showing that the registration fee above required has been paid and the date upon which the certificate of registration was issued, which certificate of” registration shall expire and be of no force and effect one year from the date of its issuance.”
Defendant contends that more than one place of sale or distribution, though operated by one person, requires registrations and certificates for each place because the certificate of registration must be posted in each place of business. Plaintiff contends, one person, one registration each as dealer and distributor, and several places of business qualified by posting duplicate certificates.
The statute requires a single registration by the person who engages in the business of retail dealer and a single registration by a distributor. Now, can it be held to require multiple registrations of one person in order to comply with the requirement of posting? The statute provides: “The word ‘person’ shall be construed to mean and include persons, firms, associations and corporations,” and imposes a specific stamp tax upon sales. The tax upon sales is one for revenue. Registration of persons desiring to enjoy the privilege is required. Multiple registrations by the same person is not required by words nor by intendment. “Each person” applies to “one person” for the purposes of •registry, and each place of business applies to one or more conducted by the registrant.
In Cupp Grocery Co. v. Johnstown, 288 Pa. 43 (135 Atl. 610), an ordinance provided that a license tax should be “ ‘levied annually upon all persons, firms, and corporations engaged in any trade, business,’ etc., within the city,” and the question was whether a separate tax on each store, operated by one owner, could be collected. The court stated:
“It is admitted by the learned city solicitor that it is not possible ‘to place one’s finger on actual words in the above act of assembly stating that a corporation, or an individual, carrying on a business taxed under said act shall pay a license tax for the business transacted at each store,’ but it is argued that it is reasonable to infer that such was the intention of the legislature.
“The rule, however, for the construction of the statute and ordinance in question upon this appeal is thus stated by Mr. Justice Walling in Commonwealth v. Pennsylvania Water & Power Co., 271 Pa. 456, 458 (114 Atl. 489): ‘The power to impose a tax is given by statute and an act relating thereto embraces such subjects only as are plainly within its terms. In other words, “A tax law cannot be extended by construction to things not described as the subject of taxation,” Boyd v. Hood, 57 Pa. 98. To entitle the Commonwealth to the tax imposed, the words of the statute must be clear and unambiguous, Commonwealth v. Brush, E. L. & P. Co., 204 Pa. 249, 252 (53 Atl. 1096); Endlich on the Interpretation of Statutes, p. 478, § 345.’
“The difficulty with the cases cited in behalf of appellant relating to the imposition of the mercantile license taxes is that these taxes are imposed under a system of statutes authorizing their imposition on each separate place of business carried on by the same person or corporation. * * *
“We agree with the court below that the cases construing our mercantile tax laws do not aid in the construction of the ordinance here involved, and we are of opinion that this ordinance provides primarily for a tax upon certain specified trades, businesses, callings and occupations, which tax is imposed upon all persons, firms, and corporations engaging’ therein. As applied to the facts in this case it is a general tax upon the designated business of engaging in the sale of groceries.” -• '
The registry fee is upon the person, and multiple registrations cannot be exacted. We hold that one registration by plaintiff, as a retail dealer, and one registration by it as a distributor, with payment in each instance of a single fee, is all the law requires.
If necessary, the writ will issue. The question being a public one, there will be no costs.
McDonald, C. J., and Clark, Potter, Sharpe, North, Fead, and Butzel, JJ., concurred. | [
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