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Per Curiam.
In this medical malpractice action, plaintiffs appeal as of right from an August 16, 1989, order granting summary disposition in favor of defendant James Armstrong, D.O. Plaintiffs claim that defendant was granted summary disposition after the trial court abused its discretion in denying their motions for an adjournment and for leave to amend their witness list. We agree and reverse.
The decision whether to allow a party to add an expert witness is within the discretion of the trial court. Butt v Giammariner, 173 Mich App 319, 321; 433 NW2d 360 (1988). The grant or denial of a motion for adjournment is also within the trial court’s discretion, and cases where a denial was proper have always involved some combination of numerous past continuances, failure of the movant to exercise due diligence, and lack of any injustice to the movant. Rosselott v Muskegon Co, 123 Mich App 361, 370-371; 333 NW2d 282 (1983). A denial because of the absence of a witness is proper where the movant fails to provide an adequate explanation and show that diligent efforts were made to secure the presence of the witness. See Sleeman v Dickinson Co Bd of Road Comm’rs, 8 Mich App 618, 624-626; 155 NW2d 262 (1967).
On July 28, 1989, the trial court granted defendant’s motion for summary disposition because plaintiffs could not carry their burden of proof without the assistance of an expert witness. Plaintiffs were without the assistance of an expert witness because the trial court had denied their motion for an adjournment and their motion to amend their witness list on July 21, 1989. In an attempt to show good cause, plaintiffs alleged that on July 11, 1989, their witness informed them that he would not testify in their behalf and that "at no time did this expert ever indicate in any way, shape or form, that he was not going to testify.”
In our opinion, plaintiffs provided an adequate explanation for the absence of their expert witness, and we do not believe any prejudice would have resulted if their motions had been granted. The original expert witness had not yet been deposed and there would not necessarily have been any effect on mediation. See Levinson v Sklar, 181 Mich App 693, 699; 449 NW2d 682 (1989). In addition, there is no indication on the record that the trial had been repeatedly postponed because of a lack of diligence on plaintiffs’ part. We also find it significant that the court’s decision on plaintiffs’ motions put an end to this lawsuit. Given the policy of this state favoring the meritorious determination of issues, Wood v Detroit Automobile Inter-Ins Exchange, 413 Mich 573; 321 NW2d 653 (1982), we do not believe that the drastic remedy of summary disposition is appropriate in this case.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction. | [
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Per Curiam.
Plaintiff appeals from an order of the circuit court finding him in contempt of court and committing him to the Oakland County Jail for thirty days, unless he purged himself of the contempt. We reverse.
This dispute arises from the enforcement of a previously entered judgment of divorce. The property settlement provisions of the judgment provided, inter alia, for a cash payment from plaintiff to defendant of $80,000. Plaintiff was to pay in monthly installments of $1,300, and the award carried interest at the rate of seven percent per annum. On May 2, 1990, defendant filed a petition for an order to show cause because the payment due on May 1, 1990, had not been received. The trial court found plaintiff in contempt for failing to make the May 1990 payment on time and committed him to the Oakland County Jail for the thirty-day period, or until he paid the $1,300 payment, plus court costs in the amount of $250 and defendant’s attorney fees in the amount of $500. Plaintiff purged himself of the contempt within an hour.
Michigan law is clear that property-settlement provisions of a divorce judgment may not be enforced by contempt proceedings. Thomas v Thomas, 337 Mich 510, 513-514; 60 NW2d 331 (1953); Chisnell v Chisnell, 99 Mich App 311, 320; 297 NW2d 909 (1980). The cases cited by defendant holding that contempt proceedings may be utilized to enforce the property settlement provisions of a divorce judgment are not on point.
Carnahan v Carnahan, 143 Mich 390; 107 NW 73 (1906), not only predates the Thomas decision, but acknowledges that the general rule is that property settlement provisions of a divorce decree are not enforceable through contempt proceedings. Carnahan, supra at 396. The Court in Carnahan allowed the use of contempt proceedings because the decree required the delivery of a specific fund of money that the contemnor had on deposit outside the jurisdiction of the court, specifically, in Canada. The Supreme Court reasoned that the decree did not require the payment of money in the ordinary sense, for which contempt proceedings would not be appropriate, but required the delivery of a specific thing, the fund, which was outside the jurisdiction of the court. Id. at 396-397. Similarly, in Schaheen v Schaheen, 17 Mich App 147; 169 NW2d 117 (1969), this Court, relying in part on Carnahan, upheld the use of contempt powers to enforce a provision in a judgment of divorce requiring transfer of certain real property located outside the jurisdiction of the court, namely, in Beruit, Lebanon.
The case at bar does not involve the delivery of any specific piece of property, located either within or without the jurisdiction of the court, but, rather, merely involves a judgment requiring the payment of money as part of the property settlement of this divorce. Accordingly, the trial court was without authority to utilize its contempt powers to force compliance with this portion of the judgment of divorce. Rather, defendant must pur sue the traditional means of collecting a money judgment.
Accordingly, the trial court’s order finding plaintiff in contempt is vacated, and plaintiff shall be reimbursed the $250 in court costs and $500 in attorney fees paid pursuant to the contempt order.
Plaintiff also argues that he is entitled to sanctions under MCR 2.114(E) and MCR 2.625(A)(2) because defendant’s motion for an order to show cause was frivolous because it was not well grounded in existing law inasmuch as the trial court had no authority to use its contempt powers to enforce the property settlement provisions of the divorce judgment. Plaintiff is correct that defendant’s position was not well grounded in existing law, which is well settled on this point. However, we decline to order the imposition of sanctions at this time inasmuch as the issue was obviously not addressed by the trial court. Rather, on remand, the trial court shall consider whether sanctions are appropriate in this case and, if so, in what amount.
The order of contempt is vacated, and the matter is remanded to the trial court for further proceedings consistent with this opinion. We do not retain jurisdiction. Plaintiff may tax costs.
Apparently there had been earlier difficulties with plaintiff making timely payments. However, it appears that at the hearing on the order to show cause, which was held on May 16, 1990, plaintiff was in arrears only with respect to the May 1990 payment. | [
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Memorandum Opinion.
Defendant was convicted of assault with intent to rob while armed, and appeals. The people have filed a motion to affirm.
Upon examination of the briefs and record, it is manifest that the questions sought to be reviewed are so unsubstantial as to need no argument or formal submission. People v Malkowski, 385 Mich 244, 247 (1971).
Motion to affirm granted. | [
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Per Curiam.
Defendant appeals as of right from a circuit court order granting judgment consistent with a jury verdict in favor of plaintiff and from the court’s denial of defendant’s motions for judgment notwithstanding the verdict, a new trial, and remittitur. We affirm.
i
Defendant first argues that the trial court erred in failing to grant its motion for a directed verdict with regard to the issue whether plaintiff was employed pursuant to an express or implied contract of employment that prohibited his termination except for just cause. We disagree.
Oral contracts of employment for an indefinite term are presumed to be terminable at the will of either party. This presumption can be overcome, however, by the existence of an express agreement to the contrary, or by the employee’s legitimate expectations of continued employment absent "just cause” for termination arising from the employer’s established policies and procedures. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579; 292 NW2d 880 (1980). To infer that an em ployment contract provides for termination only for just cause, the employee must have an objective expectation of continued employment, not merely a subjective one. Grow v General Products, Inc, 184 Mich App 379, 382-384; 457 NW2d 167 (1990).
Whether an employer’s policies and procedures constitute sufficient bases for the creation of an objective expectation of employment terminable only for just cause is a question for the jury. Toussaint, supra, pp 620-621. See also Renny v Port Huron Hosp, 427 Mich 415, 417; 398 NW2d 327 (1986). Further, in determining whether a reasonable finder of fact can conclude that a promise of job security is implied, this Court must look at all the facts and circumstances to evaluate the intent of the parties. Rowe v Montgomery Ward & Co, Inc, 437 Mich 627, 639; 473 NW2d 268 (1991). With respect to oral statements, this requires a determination of the meaning that reasonable persons might have attached to the language given the circumstances presented. Id., p 640. The statements must "clearly permit a construction which supports the asserted meaning.” Id., p 641.
We have carefully reviewed the record and remind defendant that plaintiff has not based his claim solely on the preemployment statements made by Alan Bigelow. Rather, plaintiff points to other statements made by Bigelow as well as the apparent practice of progressive discipline engaged in by Bigelow and other supervisors. Viewing all the evidence in a light most favorable to plaintiff, and according plaintiff all reasonable inferences, we conclude that a genuine issue of material fact existed upon which reasonable minds could differ regarding the existence of an employment contract providing for termination only for just cause. Stoken v J E T Electronics & Technology, Inc, 174 Mich App 457, 463; 436 NW2d 389 (1988). The trial court, therefore, did not err in denying defendant’s motion for a directed verdict.
ii
Defendant next argues that the trial court should have granted its motion for judgment notwithstanding the verdict because (1) plaintiff failed to prove he was employed pursuant to an employment contract providing for termination only for just cause, (2) defendant had just cause for terminating plaintiff, (3) defendant did not have a policy requiring three warnings before discharging for "really screwing up,” (4) plaintiff received at least three warnings before termination, (5) defendant had the right to terminate plaintiff without further warning for his dishonesty, and (6) plaintiff failed to mitigate his damages.
A motion for judgment notwithstanding the verdict should be granted only where the evidence presented is insufficient to create an issue for the jury. Wilson v General Motors Corp, 183 Mich App 21, 36; 454 NW2d 405 (1990). As with a motion for a directed verdict, the evidence and all reasonable inferences are to be viewed most favorably to the nonmoving party. Shipman v Fontaine Truck Equipment Co, 184 Mich App 706, 711; 459 NW2d 30 (1990).
A
As discussed previously, plaintiff presented sufficient evidence of defendant’s statements and procedures to justify submitting to the jury the issue of the existence of an employment contract providing for termination only for just cause. Denial of defendant’s motion for judgment notwithstanding the verdict on this basis was therefore proper.
B
Once the jury determined that plaintiff was employed pursuant to a contract that entitled him to the protection of termination only for just cause, the question whether his discharge was in breach of that contract was also one for the jury. Toussaint, supra, pp 620-621. In connection with this duty, the jury is permitted to determine the employer’s true reason for the discharge and whether the stated reason amounts to good cause. Id., p 622-623.
The various arguments raised by defendant on appeal all focus on factual decisions required to be made by the jury in order to render a verdict. Plaintiff claimed that his employment contract provided for three warnings (possibly written) as part of the progressive discipline policy apparently in effect. Plaintiff offered evidence explaining, in part, his failure to adequately perform his duties on September 16, 1988, and presented the jury with his theory that his discharge was spurious because the job assignment was designed to give defendant the means to the desired end.
Whether the employment contract provided for the warnings plaintiff claims and whether he did in fact receive such warnings were clearly issues of fact to be resolved solely by the jury. Further, the jury was entitled to determine defendant’s true motive for discharging plaintiff and whether its stated reason amounted to good cause. Moreover, the jury was able to view the demeanor of the witnesses and assess credibility. The trial court therefore properly denied defendant’s motion for judgment notwithstanding the verdict on the basis of the jury’s factual findings.
c
Lastly, defendant claims that the trial court should have granted judgment in its favor because plaintiff failed to mitigate his damages. We disagree.
Although the principle of mitigation obligates the plaintiff to accept employment of like nature, whether the plaintiff is reasonable in not seeking or accepting particular employment is a question for the trier of fact. Hughes v Park Place Motor Inn, Inc, 180 Mich App 213, 220; 446 NW2d 885 (1989); Brewster v Martin Marietta Aluminum Sales, Inc, 145 Mich App 641, 663; 378 NW2d 558 (1985); Higgins v Kenneth R Lawrence, DPM, PC, 107 Mich App 178, 181; 309 NW2d 194 (1981). Upon review of the record, we are convinced that the trial court properly denied defendant’s motion for judgment notwithstanding the verdict. Plaintiff presented sufficient evidence to create an issue for the jury’s resolution.
iii
Defendant also contends that the trial court erred in denying its motion for a new trial or remittitur because the evidence overwhelmingly preponderated in its favor. Again, we disagree.
A
A motion for a new trial may be granted when the jury’s verdict was against the overwhelming weight of the evidence. The trial court’s decision with regard to the motion will not be reversed absent an abuse of discretion. Bosak v Hutchinson, 422 Mich 712, 737; 375 NW2d 333 (1985); Wilson, supra.
The record appears to support defendant’s argument that no reasonable jury could have found that defendant lacked just cause to terminate plaintiff on the basis of his falsification of documents and dishonesty or because plaintiff failed to mitigate his damages. Nevertheless, as the trial court recognized, the standard is not whether the reviewing court would have reached a different result, but whether the evidence was such that reasonable minds could differ. Keeping in mind that the jury was in a position to judge the credibility of the witnesses, our review of the evidence leads us to conclude that a question of fact was created with regard to the issues of just cause and mitigation of damages. The trial court did not abuse its discretion in denying defendant’s motion for a new trial.
On appeal, defendant also argues that a new trial should have been granted because of certain statements made by plaintiff’s counsel during closing arguments. However, defendant did not object to any of these statements. Appellate review is thus precluded unless the failure to do so would result in a miscarriage of justice. Upon careful review of the statements in context, we are persuaded that any prejudice defendant now perceives to have occurred could have been corrected by a timely objection and request for a curative instruction. See Reetz v Kinsman Marine Transit Co, 416 Mich 97, 100-103; 330 NW2d 638 (1982).
B
As for defendant’s request for remittitur, the trial court’s denial will be reversed only if an abuse of discretion has been shown. Palenkas v Beaumont Hosp, 432 Mich 527, 531; 443 NW2d 354 (1989); Wilson, supra, p 38. The trial court is not to decide whether the award "shocks the conscience,” but whether the jury’s award is supported by the evidence. Id.; MCR 2.611(E)(1). Our review of the record convinces us that the trial court did not abuse its discretion in denying remittitur.
iv
Finally, we find no abuse of discretion in the trial court’s decision to grant plaintiff’s motion to sever defendant’s counterclaims for trial. Jemaa v MacGregor Athletic Products, 151 Mich App 273, 278-279; 390 NW2d 180 (1986).
Affirmed. | [
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R. B. Burns, P. J.
Seco Metals, Inc., was incorporated as a Michigan corporation on December 10, 1964. Its articles authorized capital stock of 25,000 shares of no par common stock. The book value and the price fixed for sale was $1 per share. Maurice 0. Hample, Delores M. Hample, and Martin Goulooze were named as incorporators. Maurice Hample was elected president, Martin Goulooze was elected vice-president, and Delores Hample was elected secretary-treasurer. The Hamples sub scribed to 800 shares of stock and Goulooze subscribed to 200 shares.
Hample and Goulooze were the company’s only full time employees. Casual labor was hired as needed.
On December 21, 1964, Mrs. Wayne Wright delivered a cashier’s check for $5,000 to Mrs. Hample. The check was made out to “Seco Metals, Inc.”. On that same date a promissory note for $5,000 plus interest was executed, payable 36 months after date to Wayne and Martha Wright. The note was signed:
“Seco Metals Inc.
7364 S. Division Grand Rapids 8, Mich.
“/s/ Maurice C. Hample—
President
“/s/ Martin J. Goulooze—
Vice-President “/s/ Delores Hample—
Secretary-Treasurer”
On January 8, 1965, a promissory note for $5,000 plus interest was executed, payable 36 months after date to Martin J. Goulooze. The note was signed:
“SECO METALS, INC.
/s/ Maurice C. Hample
/s/ Delores M. Hample.”
On February 8, 1965, a promissory note in the amount of $5,000 plus interest was executed on Seco letterhead, payable 36 months after date to Gerald B. Kooistra. This note was signed:
“SECO METAL, INC.
7364 S. Division
Grand Rapids 8, Michigan “/s/ Maurice C. Hample, President
/s/ Martin Goulooze, Vice-President /s/ Delores M. Hample, Treasurer.”
Mr. and Mrs. Hample loaned $1,000 to the corporation. No note was introduced evidencing this loan.
Account No. 38 of the general ledger showed a payment on August 31, 1965, of $500 principal to Martin Goulooze on his $5,000 loan to Seco. Account No. 39 recognizes a $400'payment of principal as of May 31,1965, to Mr. and Mrs. Hample on their $1,000 loan. Account No. 37 shows no partial payment of the debt owed the Wrights, nor does Account No. 40 indicate any payment on the debt owed Dr. Kooistra. Defendant corporation admits failure to pay any portion of these latter two debts.
On December 23, 1964, Mrs. Wayne Wright wrote a check for $150 payable to “Seco Metals, Inc.”. The notation, “Shares—1964”, appeared on the check in Mrs. Wright’s handwriting. On January 4, 1965, a certificate for 150 shares of stock in Seco was issued to the Wrights over the signatures of Delores M. Hample (Secretary) and Maurice C. Hample (President). Mr. and Mrs. Wright testified that they never received that certificate. The company’s stock transfer book bears the signatures of Mr. and Mrs. Wright, acknowledging receipt of the certificate on September 1, 1965, and surrender of that same certificate on September 7,1965. Mr. and Mrs. Wright identified their signatures.
On September 7, 1965, a check in the amount of $150 was drawn on Seco’s account, payable to Wayne N. Wright. Account No. 51 of Seco’s general ledger records a repurchase by the corporation from the Wrights of 150 of its own shares.
Mrs. Hample testified that on February 9, 1965, the corporation repurchased 600 of the 800 shares owned by the Hamples. Account No. 51 of the general ledger recognized this repurchase in two 300-share lots, but not until its entries of June 30 and July 30. The March 31 entry in that same account recognizes a purchase by the corporation from Martin Goulooze of 100 shares of its own stock.
Several entries in the general ledger indicate, and the individual defendants concede, several substantial payments to Mr. Hample and Mr. Goulooze for salaries and travel expenses. The corporation also paid premiums for life insurance on the life of Mr. Hample.
Because of a change on the zinc market, Seco failed. As early as the March 15, 1965, board meeting, the company’s financial difficulties were recognized. To economize Mr. Goulooze ceased working for Seco, although he retained his membership on the board and his position as vice-president. Mr. Hample’s salary was reduced from $200 per week to $200 per month.
Mr. and Mrs. Wright and Dr. Kooistra brought suit against Seco and against Maurice C. Hample individually, for moneys due on the promissory notes of December 21, 1964, and February 8, 1965. Mr. Goulooze filed suit against Seco for the amount due on the promissory notes executed in his favor on January 8, 1965. Mr. Goulooze did not bring an action against Mr. Hample individually.
Mr. and Mrs. Wright and Dr. Kooistra also brought an action against Mr. and Mrs. Hample and Mr. Goulooze for wrongful distribution of corporate assets, viz., payment of the personal expenses of individual defendants and redemption of the corporation’s own stock. Plaintiffs requested that individual defendants be ordered to repay to the corporation all such wrongfully diverted funds and that the corporation be ordered to pay such funds to plaintiffs in discharge of its obligation on the promissory notes.
Plaintiffs also alleged that Seco did not have a corporate existence independent of Maurice C. Ham-pie and that, therefore, Mr. Hample was personally liable for all obligations incurred in the name of the corporation.
At trial, with leave of the court, plaintiffs amended their complaint to allege an oral promise by Maurice Hample, independent of any promissory notes, to pay plaintiffs each $5,000 plus interest.
In its answer Seco conceded its liability to Mr. and Mrs. Hample, to Dr. Kooistra, and to Martin J. Goulooze. The individual defendants denied all of plaintiffs’ allegations.
The case was tried without a jury. Over objection, the judge permitted submission by plaintiffs of parol evidence as to Maurice Hample’s personal obligation on the promissory notes held by the Wrights and Dr. Kooistra.
The trial judge filed a written opinion granting judgment for plaintiffs against Seco and against Maurice C. Hample individually. The judgment against Seco was based on the company’s admission of liability on the promissory notes. Judgment against Mr. Hample was based on his oral promise to be personally obligated. .The judge granted judgment on all counts for defendants Delores Hample and Martin Goulooze.
In his opinion the judge made the following determinations of fact: (a) plaintiffs were induced to loan money to Mr. Hample by his promises to personally repay the loans; (b) disbursements for salaries, expense allowances, and insurance premiums were not improper; and (c) Seco Metals, Inc., was a “bona fide corporation”. In his opinion the judge also ruled that the parol evidence rule and the statute of frauds were not applicable in the instant case. He did not expressly determine whether the repurchase of stock and repayment of loans were improper disbursements.
Defendant Maurice Hample claims the trial court erred by admitting oral testimony to vary the terms of the written instruments.
MCLA 440.3403(3); MSA 19.3403(3) reads:
“Except as otherwise established the name of an organization preceded or followed by the name and office of an authorized individual is a signature made in a representative capacity.”
Gorsche v First National Bank of Manistique, 233 Mich 428, 439 (1926) states:
“ ‘Testimony of an oral contract is not admissible to vary the terms of a written contract whereby defendants, private bankers, undertook to transmit money to be deposited in plaintiff’s name in a bank in Russia.’
“To hold that, in the absence of fraud or mistake, oral evidence of a preliminary parol agreement is competent to vary or contradict the unambiguous provisions of a foreign bill of exchange, would destroy a settled principle of the law-merchant approved by legislative and judicial wisdom of ages.”
The trial court should not have allowed oral testimony which was so completely inconsistent with the written instruments. Therefore, the cause is reversed.
The trial judge did not expressly rule whether the repurchase of stock and repayment of loans were improper disbursements. The case is remanded to the trial court for such determination.
This case is reversed and remanded. Costs to defendants.
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Memorandum Opinion.
Defendant was convicted of breaking and entering a business place with intent to commit larceny therein, and he appeals. The people have filed a motion to affirm.
Upon examination of the briefs and record, it is manifest that the questions sought to be reviewed are so unsubstantial as to need no argument or formal submission.
Motion to affirm granted. | [
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Per Curiam.
Defendant was charged on an open count of murder. In January, 1969, he pled guilty to manslaughter and was sentenced to 10 to 15 years in prison. Defendant appealed that conviction on the grounds that insufficient facts were ascertained during the plea proceedings to support the acceptance of the plea. On the prosecution’s confession of error, this Court vacated the plea and remanded. People v. McMiller (1969), 20 Mich App 309. Defendant was then tried on the open count of murder, was convicted of murder in the second degree, and was sentenced to a term of from 15 to 20 years in prison. From this conviction and sentence defendant now appeals, alleging double jeopardy and attacking the harsher sentence on retrial.
The vacation of the guilty plea put defendant in the same position he held prior to the faulty plea. He was, therefore, properly tried on the open count of murder. People v. Garcia (1969), 19 Mich App 465; Ward v. Page (CA10, 1970), 424 F2d 491. In the opinion in People v. Harper (1971), 32 Mich App 73, a judge of this Court made an applicable statement of law:
“It is simply time for some clear thinking regarding the recently obfuscated nexus between the guilty plea and the jeopardy clause. Those familiar with jeopardy jurisprudence will undoubtedly recognize our reference to the recent opinion of the Sixth Circuit Court of Appeals, Mullreed v. Kropp, supra [(CA6,1970), 425 F2d 1095].
“We hereby express total disagreement with the Mullreed opinion. It ignores the importance of the plea milieu. Compare Ward v. Page, supra. We agree, rather, with every contention raised on behalf of the State of Michigan in Mullreed and think the Sixth Circuit’s opinion should not and need not he followed in Michigan. This is especially true with regard to Judge Phillips’ characterization of Michigan law appearing at pp 1100,1102:
“ We think the conviction and sentence necessarily show that the trial court found an evidentiary concurrence of the elements required for the conviction, otherwise the conviction on the- guilty plea would not have been lawful.
* # #
“ ‘It is apparent that the conviction on the lesser offense requires an affirmative finding that the actor was not armed with a dangerous weapon. This determination necessarily is inconsistent with a concurrent or subsequent finding that he committed robbery while armed.’
“Such is not the State of Michigan’s law. For complete explication, see People v. Sylvester Johnson (1970), 25 Mich App 258.
“Defendant Harper’s conviction upon his plea of guilty to the reduced charge of second-degree murder is affirmed.”
Again, this Court must reject the rule formulated by the Sixth Circuit in Mullreed, supra.
Although the right of appeal is impaired where the record is devoid of any grounds supporting a harsher sentence upon conviction for the same crime after a successful appeal, People v. Mulier (1968), 12 Mich App 28, North Carolina v. Pearce (1969), 395 US 711 (89 S Ct 2072, 23 L Ed 2d 656), a harsher sentence is justified where the conviction is for a more serious offense, rather than the same offense. United States, ex rel. Williams v. McMann (CA2, 1970), 436 F2d 103; People v. Garcia, supra.
Affirmed.
CL 1948, § 750.321 (Stat Ann 1954 Rev § 28.553).
CL 1948, § 750.317 (Stat Ann 1954 Rev § 28.549). | [
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R. B. Burns, P. J.
Plaintiff appeals from an order of election issued by the Michigan Employment Relations Commission.
The Labor Mediation Act (LMA) requires, as a prerequisite to a representation election, a petition from the labor organization acting in behalf of a group of employees “alleging that 30% or more of the employees within a unit claimed to be appropriate for such purpose wish to be represented for collective bargaining”. MCLA 423.27 (a); MSA 17.454 (29)(a).
In the present case “employee interest” petitions were submitted to the commission for two separate unions, General Teamsters Union, Local 406 and Operating Engineers, Local 324, each desiring to separately represent certain of plaintiff’s employees. The employer objected to the principle of two separate unions representing the employees and the necessity of bargaining with two separate unions for such a small group. To “insure employees the full benefit of their right to self-organization” the commission was required to determine the “appropriate bargaining unit”. MCLA 423.28; MSA 17.454(30). During the course of the hearing both unions offered to represent a single unit jointly.
In finding the two separate labor organizations, the Teamsters and the Operating Engineers “inappropriate” as bargaining representatives, the commission opined:
“In view of the relatively small size of the company [approximately ten employees], the inter changeability of work among the employees, the fact that they work together and their common relationship to their employer, the appropriate bargaining unit in this case includes: ‘all truck drivers, equipment operators and mechanics.’ ”
Upon reviewing the entire record we find this decision supported by “competent, material and substantial evidence”. Const 1963, art 6, § 28. The commission then determined that both labor unions could serve as the “joint representative for the bargaining unit of ‘truck drivers, equipment operators and mechanic’ ”.
In accordance with this later determination the commission ordered an election within the bargaining unit to resolve the following issue of representation:
“Do you desire to be represented by the General Teamsters Union, Local 406 and Operating Engineers, Local 324 as your exclusive representative for the purposes of collective bargaining?”
The bargaining unit, by a vote of seven to two, elected the unions as their joint representative.
As previously mentioned the labor organization seeking to represent a given bargaining unit must file an appropriate “employee interest” petition prior to a representation election. In the present case the elected “joint representative” did not solicit employee interest as a “joint representative”, nor did it file a joint petition.
Plaintiff’s employees clearly wished to be represented and a question of representation certainly existed; thus the commission was correct in ordering an election by secret ballot. MCLA 423.27 (b); MSA 17.454(29)(b) provides: “If tbe board finds upon tbe record of the hearing that a question of representation exists, it shall direct an election”. (Emphasis supplied.) The LMA does not specifically require that the “showing of interest” prerequisite relate to a specific labor organization.
Interpreting an almost identical “employee interest” provision of the NLRA the National Labor Relations Board determined in St Louis Independent Packing Co, 169 NLRB 1106, 1107; 67 LRRM 1338,1339 (1968):
“Authorization cards designating only one petitioner are sufficient to establish the interest of joint petitioners and that it is immaterial whether the cards indicate a desire for joint or individual representation. * * * We are persuaded that when 30 percent of the employees in a bargaining unit have indicated a desire to be represented by one or the other or two unions, and the two unions, then offer themselves as joint representatives of the employees, the petitioning unions have demonstrated enough employee interest in their attaining representative status to warrant holding an election.” See also Mid-South Packers, Inc, 120 NLRB 495, 41 LRRM 1526 (1958).
We agree with the board’s analysis. The two labor organizations in this case offered themselves as joint representative of the employees and the employees overwhelmingly approved. Any likelihood of confusion arising from the plaintiff’s employees being confronted on election day by a representative different from the one they were originally interested in was miniscule. Plaintiff does not allege that its employees were unaware of the consequences of their votes.
Plaintiff’s allegation that the two labor organizations would maintain their separate identities and that it would have to bargain with each separately is without merit.
Both unions have indicated they are willing and able to represent the employees in the appropriate unit jointly and indeed plaintiff can insist they do so. Plaintiff should consider his employees represented by one unit. As pointed out by the commission if the joint representatives wish to successfully represent the unit they had better “meet the needs of a majority of the employees”.
Plaintiff has not met the burden of proof necessary to show that the commission has violated statutory directives or abused its discretion in ordering the representation election. See Giaras v Michigan Public Service Commission, 301 Mich 262 (1942).
Affirmed.
V. J. Brennan, J., concurred.
The commission derives its existence and authority from the Labor Mediation Act. MCLA 423.1 et seq.; MSA 17.454(1) et seq.
Id.
For some judicial thoughts on the “appropriateness” of a given bargaining unit see Hotel Olds v State Labor Mediation Board, 333 Mich 382 (1952) and State Barbers Union, Local 55 v Barbers Union, (Local 658), AFL-CIO, 13 Mich App 20 (1968).
Two or more unions may legitimately act as a joint bargaining representative. See National Labor Relations Board v National Truck Rental Co, Inc, 99 US App DC 259, 262; 239 E2d 422, 425 (1956); cert den, 352 US 1016; 77 S Ct 561; 1 L Ed 2d 547 (1957).
The purpose of the “showing of interest” requirement under the nearly identical National Labor Relations Act, § 9(c), (1) 61 Stat 144 (1947); 29 USCA 159(e) (1) has been stated as:
“To determine whether or not further proceedings are warranted, and to avoid needless dissipation of the Government’s time, effort, and funds.” New Hotel Monteleone, 127 NLRB 1092, 1095-1096 (dissent); 46 LRRM 1154, 1155 (dissent) (1960). See also O D Jennings & Co, 68 NLRB 516, 518; 18 LRRM 1133 (1946).
National Labor Relations Act. See fn 5.
See The StieUess Corp, 115 NLRB 979; 37 LRRM 1466 (1956). | [
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Per Curiam.
This case was remanded to us by order of the Supreme Court without opinion for our reconsideration in light of Township of Owosso v City of Owosso, 385 Mich 587 (1971).
We read the order of remand to mean that if we find Owosso controls, we are obligated to reverse ourselves and the trial court and direct the entry of an order denying annexation.
We read it to mean also that if an issue pleaded or unpleaded is essential to decision and has not been passed upon, we must remand with directions to the court requiring joining of that issue and making disposition thereof.
We think a third option is available to us. If, on reconsideration, we find Owosso does not control, we may distinguish it so that any apparent conflict between our holding here and that of the Supreme Court in Owosso be eliminated.
We have addressed ourselves assiduously to the record in this case. We have studied Owosso with care. We have reconsidered our own holding. We think Owosso is clearly distinguishable for the following reasons: First, the opening statement in Owosso by the Supreme Court is (p 588):
“This case involves the construction of the judicial requirement of ‘contiguity’ in municipal annexation.”
In the case at bar, the following excerpt from the order granting summary judgment appears:
“And the parties by their respective counsel of record having stipulated to the following facts as having existed at the time of the annexation: * * * the lands annexed * * * were owned by and adjacent to the Defendant; * * * .” (Emphasis supplied.)
Owosso makes clear, p 591, that “adjacent” and “contiguous” may be, and are, used interchangeably. Thus, the issue of contiguity was stipulated out of this case. The stipulation having been received and approved by the trial judge, “contiguity” was not justiciable. The stipulation could have been rejected by the trial judge in the first place, of course, but having been accepted and the litigation having proceeded upon that acceptance, the stipulation of fact became sacrosanct and the trial judge was powerless to make a finding to the contrary.
“To the bench, the bar, and administrative agencies, be it known herefrom that the practice of submission of questions to any adjudicating forum, judicial or quasi-judicial on stipulation of fact, is praiseworthy in proper cases. It eliminates costly and time-consuming hearings. It narrows and delineates issues. But once stipulations have been received and approved they are sacrosanct. Neither a hearing officer nor a judge may thereafter alter them.” Dana Corp v Employment Security Commission, 371 Mich 107, 110 (1963). (Emphasis supplied.)
Hence, what the Supreme Court said was involved in Owosso is not involved here.
Second, this case was not the annexation of land owned by the plaintiff township and a part of its governmental territory. The defendant City of Grand Haven already owned it and was operating an airpark on it. Manifestly, this was not a city gobbling up territory of a township. The admitted hodgepodge boundary lines of the park did not come about by design in any effort to gerrymander and disenfranchise voters. The boundaries are explicable by the fact that the city bought the property involved parcel by parcel as it became available on the public market.
Third, disenfranchisement or gerrymandering could not possibly be involved here because the stipulation hereinbefore mentioned also recited “no person or persons resided thereon [the annexed property]”.
The only pleaded issue in the case was whether the property was or was not “vacant”, within the meaning of the statute. MCLA 117.9; MSA 5.2088. The trial judge held it was not. Then, however, he found as a matter of fact, clearly and unequivocally, that it was a “park”, as that term is used in the statute. We quote:
“The court based its opinion and judgment on its finding that the property was a park.”
The statute was pleaded affirmatively. The court made a finding thereunder. The statute makes annexation permissible if the involved property is “vacant” or a “park”.
We believe we have already shown the judicial imposition of the requirement of “contiguity” is not here involved.
Hence, we hold that Owosso is inapposite. For the reasons herein set forth, we affirm our previous decision.
33 Mich App 634 (1971). | [
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Memorandum Opinion.
Defendant was tried and convicted of uttering and publishing a forged instrument and appeals. A motion to affirm has been filed by the people.
• Upon an examination of the briefs and record, it is manifest that the question sought to be reviewed is so unsubstantial as to need no argument or formal submission.
Motion to affirm granted. | [
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Fitzgerald, J.
On or about July 15, 1970, Detective Kenneth Blue of the Kalamazoo County Sheriff’s Department obtained a search warrant to search a residence located at 309 East Prouty Street. This warrant was issued by virtue of an affidavit signed by Blue in which he stated that he gave a certain informer well-known to him the sum of $5 with which to purchase drugs. The informer entered the residence at 309 Prouty Street. He returned without the money, but instead, with a white powder which analysts determined to be heroin. The informer was searched before and after the entry.
The search warrant was signed by Judge Patrick McCauley of the 9th Judicial District for the City of Kalamazoo. Detective Blue and other officers then proceeded to 309 East Prouty Street to execute this warrant.
Upon arriving at the above address, Detective Blue and the others approached the residence and knocked several times on the outer screen door of a semi-closed-in porch on the front of the home. The house lights were on but no one came to the door. When there was no response to the knocking, Blue tried the door and, finding it was locked, pushed it in.
After pushing in the outer door, the officers were confronted by an innner door leading to the living room of the premises. The officers knocked on this inner door and shouted “This is the sheriff’s department, this is a raid”. After waiting a few seconds, Blue began the process of kicking the inner door in and simultaneously he yelled, “I have a search warrant”. When the door gave way, the officers entered the home and observed the defendant, Henry Harvey, either standing in the living room or coming toward the front door. Detective Blue identified himself and subsequently read the search warrant to defendant. Then Blue began a search of the premises. The search revealed illegal drugs. Defendant was arrested and charged with possession of narcotics.
After the preliminary examination, defendant filed a motion to suppress the evidence on the grounds that the warrant was improperly executed because the officers made no announcement of authority or purpose prior to breaking in the outer door and, in addition, that they gave the defendant no opportunity to respond after a brief announcement of authority and purpose prior to kicking the inner door in. The motion to suppress was denied by opinion dated December 16, 1970, which, inter alia, said:
“The third objection raised is that the detective merely knocked on the door and failed to state that it was a raid and did not give the occupants sufficient time to admit him. The testimony shows that there were several knocks and a statement made that there were representatives from the sheriff’s department making the call. It is well known, particularly in these drug cases, that rather rapid action must take place, otherwise the evidence will be destroyed. It has been the experience of officers, particularly in recent months, to learn that the common practice is to flush the powders or liquids, as they may be, down the toilets so as to destroy the same. One other danger has become apparent and that is that the people inside the building might be armed and this would place them into a position where they would be able to fire upon the sheriff’s men or policemen, as the case may be. Certainly the officers have the duty to protect themselves.”
The defendant sought leave to appeal the interlocutory order of the trial judge denying the motion to suppress. Leave was granted by this Court on April 27, 1971.
On appeal, defendant contends that the search warrant was improperly executed in violation of the statutory authority directing such execution, MCLA 780.656; MSA 28.1259(6), and also in violation of the Michigan Constitution.
The statute demands that the officer to whom a warrant is directed give notice of his authority and purpose before breaking into a house.
This Court is not unmindful of the constitutional safeguards afforded by the Fourth Amendment of the United States Constitution and incorporated into the laws of each state by the Fourteenth Amendment. It, however, feels compelled to agree with plaintiff that the statute was complied with in the instant case. In a hard drug case, where the officer has knocked on the door leading to the living quarters, loudly announced the presence of a law enforcement agency with a search warrant, announced the purpose, a raid, waited long enough for the inhabitants to reach the door from the room farthest away, and then began to kick in the door, the statute is complied with. This was the factual situation according to Detective Blue’s uneontroverted testimony. See, also, People v Doane, 33 Mich App 579 (1971).
Though the officers failed to comply with the provisions of the pertinent statute prior to breaking in the outer door, a screen door, on a screened-in porch, this is irrelevant because the provisions of the statute were met prior to entry into the living quarters. Just as officers could not be expected to give notice of authority and purpose prior to entering the outside door of a high-rise apartment building, they could not be expected to comply more substantially than they did in the present case prior to knocking on the door separating them from the inhabitants’ living quarters.
The defendant is further protected since the search warrant was issued only after probable cause had been determined by a judge.
This Court, therefore, finds that the warrant was properly executed.
Accordingly, the action of the trial court is affirmed.
All concurred. | [
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Memorandum Opinion.
Defendant was charged with and convicted after a jury trial of the felony of malicious destruction of property resulting in damage over the value of $100, MCLA 750.380; MSA 28.612. Defendant appeals as of right.
An examination of the records and briefs discloses no prejudicial error.
Affirmed. | [
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O’Hara, J.
On May 1, 1970, defendant was found guilty of seeond-degTee murder. He raises but one issue on appeal. It is of serious import to tbe trial courts of this state.
On April 16, 1970, little more than a week before the scheduled starting date for the trial, the defense counsel filed a praecipe motion requesting that the court order a psychiatric examination of the defendant to determine his mental competency to stand trial. On April 20, 1970, the court held a hearing upon the motion at which time the following transpired :
“The Court: The record will show now that Attorney Ronald Black is in the courtroom.
“You may proceed.
“Mr. Ruhala [for defendant]: Yes, your Honor. I have brought this motion before the court this morning as a result primarily of the latest findings of the Walker hearing, which was held on the 15th, which was last Wednesday.
“I have had considerable difficulty in working with this individual and obtaining information, names, things that happened; getting a coherent statement from him as to what transpired on the night that a shooting occurred at the Giant Ballroom.
. “Reading over the statements that was [sic] given to the police, I find they had the very same problem with this man. He’s inconsistent; he is incoherent at times; he does not have the sufficient ability to supply me with witnesses’ names, although he says he has witnesses. All he can supply me with is the name of Dude or a nickname. It’s remarkable a boy 18 years of age wouldn’t know somebody by their last name. Or if he knows a street, that he wouldn’t know a street number. I can’t subpoena people like this. I can’t get any help from him.
“And after the Walker, hearing and we went into his educational background and so forth, and listening to him testify on the stand again, I have come to the conclusion that this gentleman should be examined by a psychiatrist to find out whether or not he is capable of assisting me in his own defense. I feel that he is not, your Honor.
“The Court: Attorney Black?
“Mr. Black [assistant prosecutor]: Well, as usual the prosecutor’s placed in a precarious position. The people are ready to proceed with the trial of this case. It is in the process of being subpoenaed. But on the other hand, if there is the possibility that he may be incompetent to assist his attorney, maybe he should be examined.
“The Court: All right. Thank you, counsel. This matter’s now scheduled for trial on Friday, April 24, 1970, as case number two. It’s an important case to the defendant, it’s an important case to the people, and it’s a case that has been scheduled for some considerable period of time. At the criminal call there was no indication that such a motion would be filed.
“The defendant, did appear and did testify at the Walker hearing, at which time counsel and the court asked questions of the defendant, and the responses, in the court’s opinion, were appropriate under the circumstances and did not indicate any lack of ability to comprehend.
“The motion is not timely made. It would be impossible for us to schedule an appointment at the Center for Forensic Psychiatry within a time that would make it possible for us to have a report before Friday of this week.
“The court will deny the motion.”
Defendant renewed his motion on the day trial was scheduled to begin. Again the motion was denied, the court then saying:
“The Court: No, there’s no suggestion that counsel has waited improperly as a trial tactic. I’m just saying that it conld be used improperly if tbe statutes and the court rule were read as defense counsel wants the court to read it.
“It is my interpretation of the statute and the court rule that the court still has the right to exercise a discretion as to whether a competency hearing can be ordered, and the matters which this court has weighed in making the decision in denying your motion originally was, first of all, that it was too late, and, secondly, that the court has had the opportunity to hear this witness testify and has watched him testify and is satisfied that his answers were clear and direct; * * * that he appears to be able to assist counsel, except that he appears willing to admit that the statements given by him to the police were voluntarily and knowingly, understandingly given with a waiver of his constitutional rights.
“Now, if we have to start presuming that a person who voluntarily admits on the stand that he’s guilty of an offense is not competent to stand trial, I think we’re carrying things a little too far, and I’m sure that’s not the rule in this state.
“The motion will be again denied.”
Subsequently, the court suggested, and the parties agreed, that a local psychiatrist examine the defendant. The case was adjourned for four days, after which time the local psychiatrist reported his finding that the defendant was competent to stand trial. Trial was thereupon commenced and completed.
The issue before this Court is whether or not the trial court committed error in not granting the defendant’s motion made prior to trial for a psychiatric commitment pursuant to MCLA 767.27a; MSA 28.966(11), as supplemented by GCR 1963, 786.
MCLA 767.27a; MSA 28.966(11) is originally 1966 PA 266. This act repealed and replaced MCLA 767-.27; MSA 28.967, whose ancestral roots reach back to 1883. The pertinent language of the original act, 1883 PA 190, § 18, read:
“If any person in confinement, under indictment of [for] the crime of arson, or murder, or attempt at murder, rape, or attempt at rape, or highway robbery, shall appear to be insane, the judge of the circuit court of the county where he is confined shall institute a careful investigation; he shall call two or more respectable physicians, and other credible witnesses, and the prosecuting attorney to aid in the examination, and if it be deemed necessary to call a jury for that purpose, is fully empowered to compel the attendance of witnesses and jurors. If it is satisfactorily proved that such person is insane, said judge may discharge such person from imprisonment, and order his safe custody and removal to one of the State asylums, or to the Michigan asylum for insane criminals, after the latter institution is open for the reception of patients, at the discretion of such judge, where such person shall remain until restored to his right mind; and then if the said judge shall have so directed, the superintendent of the said asylum shall inform the said judge and prosecuting attorney so that the person so confined may, within sixty days thereafter, be remanded to prison and criminal proceedings be resumed, or otherwise discharged.” (Emphasis supplied.)
In 1929 the language was changed slightly, 1929 PA 24, Ch VII, § 27, but the concept remained the same. Thus, immediately prior to 1966 the existing statute invested substantial discretion in the trial judge whenever an issue of competency was raised. A hearing on the issue was held only when the defendant appeared to be insane. Commitment was ordered only if incompetency was satisfactorily proven. Under these earlier statutes a mere request for a competency hearing made by the defense attorney was insufficient to generate these proceed ings, People v Wilson, 11 Mich App 721 (1968), as the court was not obligated by statute to grant such a request.
The trial judge’s discretion however was not so broad as to allow him to deny summarily an investigation into the competency of the accused in all cases. The United States Supreme Court, recognizing that a fair trial cannot be had if the defendant is mentally incompetent, held in Pate v Robinson, 383 US 375; 86 S Ct 836; 15 L Ed 2d 815 (1966), that a sanity hearing must be held “where the evidence raises a ‘bona fide doubt’ as to a defendant’s competence to stand trial”. See People v Russell, 20 Mich App 47 (1969). Thus, even under the earlier statutes a trial judge was required to conduct a competency hearing not only when the accused appeared to be insane but whenever the evidence before the court was such as to raise a bona fide doubt as to the mental competency of the defendant.
The 1966 act did not alter the basic law with regard to mental competency to stand trial but did enact significant procedural changes. We note initially, for example, that under the present scheme the issue of competency to stand trial is covered by a statute separate from that dealing with proceedings generated by an acquittal by reason of insanity (which is now MCLA 767.27b; MSA 28.966 [12]). Thus, the procedure for determining the issue of mental competency no longer resides in two or three short sentences, as was the case with the earlier statutes noted above. Rather it is laid out in nine, somewhat detailed, sections, as well as in a court rule to be discussed further.
Section 1 of the statute continues the definition of incompetency from the earlier acts. Simply, a person is incompetent to stand trial if incapable of understanding the nature and object of the proceedings against him, of comprehending his own condition in reference to the proceedings, or of assisting in his defense in a reasonable or rational manner.
Section 2 first lists the persons who may petition the court for a competency proceeding and then defers matters of form and time to the court rules:
“The issue of competence to stand trial may be raised by the prosecuting attorney, defense counsel, by any interested person on leave of the court, or by the court on its own motion. The time and form of the procedure incident to raising the issue of competence shall be provided by court rule.”
Note here that the present statute took effect in 1967, but the court rule, GCR 1963, 786, was not promulgated until 1969. Several cases arising under this statute were decided in the interim and will be discussed further below.
For further clarification of the issue, we set forth the three subsequent sections with appropriate emphasis supplied:
“(3) Upon a showing that the defendant may he incompetent to stand trial, the court shall commit the defendant in the criminal case to the custody of the center for forensic psychiatry or to any other diagnostic facility certified by the department of mental health for the performance of forensic psychiatric evaluation. The commitment shall be for a period not to exceed 60 days. Within that period the center or other facility shall prepare a diagnostic report and recommendations which are to be transmitted to the committing court.
“(4) Upon receipt of the diagnostic report and recommendations the sheriff shall immediately return the defendant to the committing court and the court shall immediately hear and determine the issue of competence to stand trial. The diagnostic report and recommendations shall be admissible as evidence in the hearing, but not for any other purpose in the pending criminal proceedings.
“(5) If the defendant is adjudged to be incompetent to stand trial, he shall be committed to the department of mental health for treatment in a public institution approved for the purpose by the department of mental health.”
An obvious and important change brought about by this new statute is the change of the time for commitment. Under the earlier statutes commitment to a state institution for any length of time followed, rather than preceded, the investigation and hearing by the trial court. The present sequence places the competency hearing after the commitment to the forensic center. This appears to be the legislative substitute for the “two or more physicians” formerly appointed by the court. The older system allowed the trial judge to exercise a modicum of control over the proceedings involved, and he could adjust his own docket accordingly. The new method would seem, at first blush, to obligate the court to send the accused to the forensic center merely on motion. However, we think there is protection against tactical but unnecessary delays caused by frivolous alie gations of incompetency to be found in tbe opening phrase of § 3, which conditions the remaining proceedings “upon a showing that the defendant may be incompetent”.
The importance of this phrase became clear as cases arising under the new statute made their appearance before this Court. People v Kerridge, 20 Mich App 184 (1969), People v Hartford, 25 Mich App 200 (1970), and People v Kearns, 25 Mich App 579 (1970), all affirmed the trial court’s refusal to send the defendant to the forensic center because no “showing” of mental incompetency had been made. Kearns states the rule correctly (p 584):
“A bare assertion of defendant’s incompetency to enter a guilty plea does not, of itself, constitute a sufficient ‘showing’. United States v Scherk (ND Cal, 1959), 177 F Supp 793, 800. Rather, the trial court must be presented with information which would raise a ‘bona fide doubt of the defendant’s competency to waive his constitutional rights and plead or to stand trial.’ Wolcott v United States (CA 10,1969), 407 F2d 1149,1151; People v Bussell (1969), 20 Mich App 47.”
However, all three of these cases were decided prior to the promulgation of GrCR 1963, 786. Both Kerridge and Kearns make the unsupported suggestion that had this court rule been operative the results of the ease might have been different. The Kerridge dicta is the more considered of the two:
_ “Section (2) of the statute, supra, states that the time and form of the procedure incident to raising the issue of competence shall be provided by court rule. Although the statute was effective in 1967, the court rule pertinent thereto was not promulgated until May 15, 1969 (GCR 1963, 786), and calls for a written motion before trial on behalf of defendant or the raising of the issue during trial only by the trial court. It appears to us that in the absence of the court rule, the trial court in the instant appeal was seeking the ‘showing’ called for in § 3 of the statute, supra, and that examination by a psychiatrist in the manner done satisfied the statute at the time of defendant’s trial. Had the psychiatrist stated him to be incompetent, the next step would have been referral of the defendant for forensic psychiatric examination.
“The court rule promulgated in 1969 now dictates the proper method for determination of a defendant’s competency to stand trial. There can be no argument as to retroactivity of a court rule and accordingly we hold that the actions of the trial court at the time of defendant’s 1968 trial satisfied the statute. The 1969 court rule now prescribes the approved method and must be followed when the question of defendant’s competency to stand trial is properly raised.”
The court rule, of which these cases foretell the coming, reads as follows:
“Rule 786. Mental Competency Hearings in Criminal Trials.
“1. The issue of a defendant’s competence to stand trial as defined in Act No. 266 of the Public Acts of 1966 may be raised at any time before trial by a written motion to commit the defendant to the department of Mental Health.
“2. The issue of defendant’s competence to stand trial may be raised during trial only by the trial court on its own motion.
“3. If defendant is the moving party, the court shall order the defendant committed to a diagnostic facility certified by the department of Mental Heálth for the performance of forensic psychiatric evaluation for a period not to exceed 60 days from the date of the commitment order.
“4. If the motion is not made by the defendant, the court shall order the defendant to show cause why he should not he committed to an approved diagnostic facility certified by the department of Mental Health for the performance of forensic psychiatric evaluation, for a period not to exceed 60 days from the date of the commitment order.
“5. When a defendant has been committed to an approved diagnostic facility certified by the department of Mental Health for the performance of forensic psychiatric evaluation, the motion to commit the defendant to the department of Mental Health shall stand adjourned pending receipt of the diagnostic report and recommendation of the facility.
“6. Where the issue of a defendant’s competence to stand trial is raised during the trial by the court, the trial of the cause shall be continued or a mistrial declared as the court shall in its discretion deem appropriate.
“7. If upon the hearing on the motion the defendant shall be adjudged incompetent to stand trial, he shall be committed to the department of Mental Health pursuant to Act No. 266 of the Public Acts of 1966, and the pending criminal proceedings against such defendant shall stand adjourned until the further order of the court.”
In reading this court rule, we note initially that it seems to go beyond the scope contemplated by § 2 of the statute. Section 2 directs that the court rule provide for the time and form of raising the issue of incompetency; GrCR 1963, 786.1 and 786.2 clearly satisfy this requirement, but 786.3 and 786.4 do not appear to concern either the time or the form for raising the issue of incompetency. They overlay a matter covered in § 3 of the statute without, and this is the important distinction, the precautionary words “upon a showing”. The implication arising from this court rule is that at any time prior to trial the defendant may raise the issue of incompetency and the court must then commit the defendant to a diagnostic facility. Because the court rule lends itself to this interpretation, the defendant in the present case insists that the trial court had no discretion, but had to commit him to the diagnostic facility when the issue was raised before trial. We hold, however, for the reasons which are soon to follow, that when prior to trial a motion raising the issue of incompetency is made, commitment to a diagnostic facility will be mandated only if a sufficient showing of mental incompentency is made by the moving party, or when other evidence is before the court which raises a bona fide doubt as to the defendant’s mental competency to' stand trial.
We share the concern of the trial court that the defendant’s interpretation of the court rule would deprive the court of a discretion which has existed throughout the history of the competency statutes, and which is continued today in § 3 of the present statute. If, on a mere empty allegation of incompetency made a week before trial, the defendant can delay matters for 60 days, he can likewise do so one hour before the trial begins, after the court date has been set, witnesses called, and the docket cleared of all other matters but this one case. The danger of allowing such a practice is obvious—it leaves the already monumental complexities of a functioning, understaffed, and overworked lower court further to the mercy of dilatory tactics by a defendant or his counsel. We cannot, from a practical standpoint, conclude that the court rule was meant to abrogate the requirement of a reasonable showing or the existence of a “bona fide” doubt.
Becently our Supreme Court had an opportunity to discuss thoroughly the relationship between a statute and a seemingly conflicting court rule. Some of the insights provided in Buscaino v Rhodes, 385 Mich 474 (1971), are helpful towards resolving the apparent conflict between the court rule and a statute in this case (pp 478-479):
“Thus, it is clear that there is recognition of the need to grant the Supreme Court broad powers to make rules which will tend to increase the efficient administration of justice at a time when our courts are seriously overburdened. Our Court has recognized in numerous cases the validity of the rule-making power, both under our present and former Constitutions. We have recognized that art 6, § 5, Michigan Constitution of 1963, and its predecessors, must be liberally construed in order to aid in the efficient administration of our judicial system.
“In Jones v Eastern Michigan Motorbuses (1939), 287 Mich 619, 630, our Court stated:
“ While courts are very generally authorized by statute to make their own rules for the regulation of their practice and the conduct of their business, a court has, even in the absence of any statutory provision or regulation in reference thereto, inherent power to make such rules. Fullerton v Bank of the United States [1828], 1 Pet (26 US) 604 [7 L Ed 280]; Van Benschoten v Fales [1901], 126 Mich 176; Wyandotte Rolling Mills Co. v Robinson [1876], 34 Mich 428. This power is, however, not absolute but subject to limitations based on reasonableness and conformity to constitutional and statutory provisions. Ward v Chamberlain [1862], 2 Black (67 US), 430 [17 L Ed 319]; Youngs v Peters [1898], 118 Mich 45.’ ”
Although in Buscaino the Court concluded that since a matter of procedure was involved the court rule was controlling, this decision was reached by considering a general policy to expedite procedure and unclog the dockets. The defendant’s interpre tation of the court rule in the present case would manifestly have the opposite effect and defeat this preferred policy.
Our Court has previously interpreted Supreme Court rules when that Court had not spoken, and where necessary to expedite the administration of justice.
In Guastello v Citizens Mutual Insurance Co, 11 Mich App 120 (1968), we recognized the importance of avoiding a rigid, inflexible posture towards our court rules, aware that “the lesson of history is that if the courts lose sight of the function of procedural rules, our new rules will become as unresponsive to their purpose as the old judicial and later statutory rules of practice which they replace”.
If there is a way of resolving the apparent conflict between the statute and court rule without doing a violence to either, we feel it incumbent upon us to do so.
In the present case, the statute and court rule are so closely interrelated that their reconciliation requires no strained interpretation. The court rule must be read in the light of the statute to which it refers. Masonite Corp v Martin, 314 Mich 411 (1946); Woodliff v Baker, 279 Mich 356 (1937). This statute provides that the court rule should concern only matters of time and form, not substance. We will interpret GCR 1963, 786 accordingly.
The subsections of the court rule do not affect the substantive requirement of a showing. Although GCR 1963, 786.3 and 786.4 are written in mandatory terms, they may properly be read in a way which will not defeat the requirement of a proper showing and which still will comply with the procedural requirements of the rule.
The court rule does not specify who may bring a motion raising the issue of incompetency, yet we know from § 2 of the statute that persons other than the defendant may make it. Thus, this procedural matter is left to the rules.
GrCR 1963, 786.4 wisely provides that if the motion is made by a person other than the defendant then the defendant shall he given the opportunity to challenge that motion before he is committed.
If the defendant raises the issue of incompetency, then the court must commit the defendant to a diagnostic facility upon a requisite reasonable showing.
In either situation, the sine qua non is a reasonable showing that incompetence to stand trial may exist.
By keeping viable this statutory requirement of a showing, we work no injustice upon an accused. We do not attempt to prescribe a rigid rule as to the degree of showing to be made. We are confident that the trial bench will apply the requirement reasonably and rationally.
However, once the requisite showing of incompetency has been made the court must comply with the statute and commit the defendant. Court-appointed psychiatrists cannot be substituted therefor. This is what we read People v Ledbetter, 31 Mich App 160 (1971), to mean.
When we scrutinize the assertions in the present case, we see only the defense attorney’s contention that he was having difficulty understanding his client. No evidence or testimony of any history or present manifestation of mental illness or mental incompetency was presented. Even so, the court sua sponte enlisted the services of a psychiatrist to examine the defendant. The results of this examination failed to show that a hona fide issue of mental incompetence existed.
We cannot but conclude that the essence of the involved statute and rule were assiduously respected by tbe trial judge and that no prejudice to the defendant resulted.
The judgment of conviction is affirmed.
Danhop, P. J., concurred.
People v Walker, 374 Mich 331 (On Rehearing, 1965).
In fact, it appears that where no basis for such a hearing was demonstrated by the moving party, the trial judge would be abusing his discretion to conduct such a hearing. Jett v Judge of Recorder’s Court for Detroit, 366 Mich 281 (1962). The petition in this case, however, was brought by the prosecutor. But see, People v Chambers, 14 Mich App 164 (1968).
Bishop v United States, 350 US 961; 76 S Ct 440; 100 L Ed 835 (1956).
The remaining sections are not important to our discussion and may be briefly summarized. Section 6 provides for proceedings upon the regaining of competence by the defendant; § 7 provides for proceedings should it appear that the defendant may regain competence within a reasonable time; § 8 provides for the transfer of jurisdiction to the probate court to determine matters of commitment; and § 9 allows for credits against the sentence and for continuance of the statute of limitation. | [
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R. B. Burns, J.
The City of Midland appeals the trial court’s decision declaring ordinance 741, an amendment to city ordinance 727, “null and void and of no force an!d effect”.
Ordinance 741 affects property located near the plaintiffs’ residences within thé City of Midland. The affected property, a large wooded area bordered on the east and north by highways and on the south and west by residential areas, was zoned A-l residential by ordinance 727 which permitted private residences only.
Ordinance 741 amended ordinance 727 and rezoned the subject property to permit the construction of a shopping center.
The trial court reviewed the present rezoning controversy under authority of MCLA 125.590; MSA 5.2940 which givés circuit courts power to review zoning cases both as to fact and as to law. In the trial court’s opinion, the City of Midland exceeded its powers of land use regulation given to it by the state.
The trial court in a well reasoned opinion made the following statements and findings:
“Was ordinance 741 enacted in accordance with the provisions of § 1 of Act 207, Public Acts of 1921 [MCLA 125.581;] MSA 5.2931, the enabling act giv ing cities the power to zone? This section reads in part: ‘Such regulations shall be made in. accordance with a plan designed to lessen congestion on the public streets, to promote public health, safety, and general welfare, and shall be made with reasonable consideration, among other things, to the character of the district, its peculiar suitability for the particular uses, the conservation of property values, and general trend and character of building and population development.’
“Under the evidence as presented in this case the court finds as a fact ordinance 741 was not made in accordance with a plan designed to lessen congestion on the public streets. Two experts testified for the plaintiffs and one for the defendant relative to the impact of a shopping center at this location upon traffic conditions. All agreed that traffic would be increased to a point where serious problems would be created, which would make it necessary to install, traffic lights at the intersection of Eastman and Wackerly Roads. The consequences of this traffic light would include the backing up of traffic onto the expressway, US 10. In addition, curb cuts would be required on both Eastman and Wackerly Roads for entrance and exit from the proposed shopping center.
“The court further finds that ordinance 741 was not made in accordance with a plan to promote the public health or safety. There was no evidence whatever that the rezoning of this area for purposes of construction of a shopping center would in any way contribute to the public health or public safety.
“Did ordinance 741 in some way promote the general welfare? It appears to this court that the evidence does not sustain this conclusion. The only testimony regarding this matter was to the effect that it would provide within the City of Midland an additional place for people to shop. The court finds that the area in question is not peculiarly suitable for any single^ purpose or use. It could be employed for shopping center purposes with profitable economic consequences to the owners and developers. It could also be used for the construction of single family, residences.
“The court further finds as a fact that the present character of the area is residential in nature, that the .general trend and character of building and population development in the north half of section 4 has been exclusively in that direction since the addition of the section to the city, with the exception of the building of two elementary schools and a single gas station as earlier noted.
“This court takes judicial notice of the fact that the construction of commercial enterprises in a residential district has the effect of lowering the value of existing nearby homes. On the other hand, unimproved land may be increased in value as it becomes more susceptible to rezoning for additional profitable commercial uses.
“Section 35.1 of the Zoning Ordinance Number 727 of the City of Midland entitled ‘Amendment Procedure,’ provides as follows: ‘For the purpose of establishing and maintaining sound, stable, and desirable development within the territorial limits of the municipality, this ordinance shall not be amended except to correct an error in the ordinance, or, because of changed or changing conditions in a particular area or in the municipality generally, to rezone an area, extend the boundary of existing zoning district or to change the regulations or restrictions thereof.’
“No suggestion was made at any time that there was any error in ordinance 727, which became effective July 28, 1969. Ordinance 727 was passed after public hearings and it must be presumed that the city council was aware of conditions then existing within the limits of the City of Midland. The remaining question is whether or not there have been any changed conditions or changing conditions in the particular area or in the municipality generally which would warrant the amendment of ordinance 727.
“It is the opinion of this court that there were no changed or changing conditions either in the particular aréa in question or in the municipality generally which warranted the enactment of ordinance 741. It was established by the testimony that the vast majority of all construction in the northwest corner of section 4 since the time of its first annexation to the City of Midland has been for the purposes of single family residences. There has been no change in this area whatever between the effective date of ordinance 727 and the date of ordinance 741.
“Section 35.2 of ordinance 727 sets forth certain standards for rezoning which, presumably, the planning commission and the city council are to take into consideration before rezoning any property. These conditions are as follows:
“(a) Changes in land use conditions which justify rezoning.
“This court has already indicated that in its opinion no such changes in land use conditions as would justify this rezoning were present. In fact the changes- in land use conditions in this area since it was annexed to the city strongly reinforce the original zoning as being proper. The plaintiffs testified to the effect that the residential zoning in this area in question was a factor which they considered and relied upon in building their homes.
“(b) Adverse influences on living conditions in the neighborhood.
“The testimony presented relative to this question, in the opinion of the court, determines that the creation of a shopping center on the rezoned property would have an adverse influence on living conditions in the neighborhood. The extent of such adverse influence may be more pronounced on certain plaintiffs than on others; however, there is no question in the court’s mind that the presence of a shopping center would be adverse rather than otherwise on the living conditions in this neighborhood.
“(c) Adverse effects on property values in the adjacent area.
“In tbe opinion of the court the testimony presented establishes the fact that property values in the nearby residential areas not rezoned would be adversely affected by this shopping center. The property actually rezoned for shopping center and •office services purposes would, of course, be more valuable than for residential purposes, but this has no bearing on whether or not the area should be rezoned.
“(d) Deterrents to the improvement or development of adjacent property in accord with existing regulations.
“The court is of the opinion that the evidence in this case justifies the conclusion that the rezoning of this particular area would in fact be a deterrent to the improvement and development of adjacent property in accordance with existing regulations. The zoning of such a large area, as in this case, will have the effect of deterring further residential development adjacent to it and this in turn will eventually prompt further changes which will further encroach upon the residential area.
“(e) Grants of special privilege to am, individual property owner contrasted to other property owners in the area or the general public.
“The court does not find that it was the city council’s intention to grant any special privileges to the owners of the rezoned property; however, the court notes in this connection that the evidence indicates that there are other areas within the city which are currently zoned for. uses which could include the construction of centers.
“(f) Substantial reasons why the property cannot be used in accordance with its present zoning classifications.
“The court finds from the evidence in this case that the property involved can be used for residential purposes and that it would have substantial value for such purposes.
“(g) Direct conflict with the planned use for the area in question as outlined by the comprehensive development plan for the city.
“As previously pointed out by the court, the master Plan for the City of Midland which was originally enacted in 1945 did not include the property in question. Ordinance 727 made the property in question a part of the master plan. There was evidence in the case which would indicate that after the rezoning of the property by the city council contrary to the recommendation of the planning commission, a proposal was made by the planning commission showing a shopping center in the area in question. The court is of the opinion that the planning commission’s recommendation made after the fact was nothing more than a recognition of the fact that the area had already been rezoned and that it was not the considered judgment of the planning commission that such a center was desirable.
“Findings of Law
“It is the opinion of this court that this case is controlled by the recent decision of the Michigan Supreme Court, to-wit: Raabe v City of Walker, 383 Mich 165 (1970), decided on March 9,1970. The Supreme Court cited with approval the case of Offutt v Board of Zoning Appeals of Baltimore County, 204 Md 551; 105 A2d 219 (1954). The Court quotes from said opinion at page 178, as follows:
“ ‘When an application is made for reclassification of a tract of land from one zone to another, there is á presumption that the zones established by the original zoning ordinance were well planned and arranged and were intended to be more or less permanent, subject to change only when there are genuine changes in conditions. Therefore, before a zoning board rezones a property, there should be proof either that there was some mistake in the original zoning or that the character of the neighborhood had changed to such an extent that reclassification ought properly to be made.’
“This court will adopt the following portion of the trial court’s opinion in Raabe v City of Walker, to-wit:
“ ‘For the reasons stated above I find that the rezoning is not in the publie interest within the meaning of that term as used in rezoning cases, that the requirements of the enabling statute have not been met, and that the proposed rezoning of the area is not a proper exercise of police power.’ ”
We agree with the findings of the trial judge and his conclusions.
Affirmed. No costs, a public question being involved.
All concurred.
The trial court issued a declaratory judgment in accordance with GCR 1963, 521.
An exception to the A-l classification of the wooded lot was a very small parcel of land situated at the extreme northwest corner of the wooded lot. This small parcel was zoned business (B-l) and contains a gas station.
A municipal corporation has no inherent power of zoning and therefore may only pursue its policies of use restriction pursuant to a statute enabling it to do so. Krajenke Buick Sales v Hamtramck City Engineer, 322 Mich 250 (1948); Detroit Osteopathic Hospital v Southfield, 377 Mich 128 (1966). A municipal corporation zoning regulation, although constitutional, may be invalid for transgressing the statute authorizing municipalities to enact regulations. Sisters of Bon Secours Hospital v Grosse Pointe, 8 Mich App 342 (1967). | [
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Memorandum Opinion.
Defendant was convicted of larceny from a person and appeals. The people have filed a motion to affirm.
Upon examination of the briefs and record, it is manifest that the question sought to be reviewed is so unsubstantial as to need no argument or formal submission.
Motion to affirm granted. | [
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J. H. Gillis, J.
The defendant appeals as of right from his convictions and sentences, having been found guilty by a jury of felonious assault (MCLA 750.82; MSA 28.277) and carrying a concealed weapon (MCLA 750.227; MSA 28.424).
Defendant’s automobile was passed by complainant’s truck in a way he did not appreciate. He proceeded to follow the truck to its destination. The defendant then got out of his car, pistol in hand, and approached the complainant, his passengers, and a group of children mingling around them. Spotting a policeman investigating an accident down the road, one member of the group went to summon his help. The defendant apparently saw the policeman and, returning to his car, placed the gun in its glove compartment. The policeman went to his patrol car, requested backup help and proceeded to the scene.
The police officer testified that when he arrived defendant was standing at the left front of his car. He immediately placed defendant under arrest, searched and handcuffed him and placed him in the back of the patrol car. The policeman then entered defendant’s car and removed the gun from the glove compartment. Shortly thereafter other police officers arrived at the scene.
Defendant contends that the hand gun was obtained by the police officer through an unconstitutional search of his automobile. It is clear that probable cause for the arrest was provided by the report to the officer that defendant had a gun and was going to shoot someone. Likewise there was probable cause for the search of the automobile from the fact that the officer was informed at the scene that defendant had placed the gun in the car. Here the policeman made a warrantless search of the automobile immediately subsequent to the arrest of the accused. Such a search has been upheld in numerous cases. Chambers v Maroney, 399 US 42; 90 S Ct 1975; 26 L Ed 2d 419 (1970); People v Weaver, 35 Mich App 504 (1971); People v Thomas, 33 Mich App 664 (1971); People v Miller, 26 Mich App 665 (1970).
However, an important aspect of cases of this type must not be lost sight of. As the Court in Coolidge v New Hampshire, 403 US 443, 461, 462; 91 S Ct 2022, 2035, 2036; 29 L Ed 2d 564, 580 (1971), points out:
“The word ‘automobile’ is not a talisman in whose presence the Fourth Amendment fades away and disappears. And surely there is nothing in this case to invoke the meaning and purpose of the rule of Carroll v United States [267 US 132; 45 S Ct 280; 69 L Ed 543 (1925)] — no alerted criminal bent on flight, no fleeting opportunity on an open highway after a hazardous chase, no contraband or stolen goods or weapons, no confederates waiting to move the evidence, not even the inconvenience of a special police detail to guard the immobilized automobile. In short, by no possible stretch of the legal imagination can this be made into a case where ‘it is not practicable to secure a warrant,’ Carroll, supra, at 153 [45 S Ct at 285; 69 L Ed at 551], and the ‘automobile exception,’ despite its label, is simply irrelevant.” (See also footnotes 18 and 19 to this case.)
In other words, there still must be a “need” for a search without a warrant even of an automobile. Preston v United States, 376 US 364; 84 S Ct 881; 11 L Ed 2d 777 (1964); Smith v United States, 335 F2d 270, 273 (1964); People v Dombrowski, 10 Mich App 445, 448 (1968).
In considering the case presently before us, we conclude that such a “need” did exist. Even though the officer who first arrived on the scene had defendant handcuffed in his patrol car, the search which was conducted took place before the other officers arrived. There was no certainty when or if help would come. The officer could not reasonably be expected to remain at the scene with defendant in order to watch the car until assistance arrived. In addition, a number of people were milling about tbe premises at the time. The search was justified in order to preclude removal of the evidence.
The defendant further contends that the court erred in excusing the prosecutor from producing an indorsed res gestae witness. Testimony tended to show that the witness’s testimony, if given, would be cumulative of the other witnesses’ testimony. Additionally, the missing witness was in the army in Vietnam. Under these circumstances, the trial court ruled that the witness’s testimony would be cumulative, and that he need not be produced. We agree, there being no clear abuse of discretion. People v Tiner, 17 Mich App 18 (1969); People v Alexander, 26 Mich App 321 (1970).
Affirmed.
All concurred. | [
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O’Hara, J.
The question presented by this appeal is whether cosmetology is a profession within the meaning of the statute establishing two years as the limitation period for actions charging malpractice as opposed to the three-year period for all other actions charging injury to person or property.
The trial judge, properly denominating the issue as the determination of legislative intent, held the shorter period of two years in the cases of “malpractice” to apply. He granted summary judgment in favor of the defendant cosmetologist on that ground.
In this we think he was in error. Judicial determination of legislative intent in cases of ambiguity or conflict in a statute is governed by long-standing case law. We do not deem a discussion of these cases helpful here.
As we read the statute there is no ambiguity and thus no basis for judicial interpretation. We think the statute is clear. It contains its own definition of cosmetology.
“ ‘Cosmetology’ means any branch * * * of the occupation of a hairdresser, cosmetician, cosmetologist, beauty oulturist, or any other person holding himself or herself out as practicing cosmetology by whatever designation.” MCLA 338.752; MSA 18-.132. (Emphasis supplied.)
We cannot but conclude that if the Legislature had intended cosmetology to be considered a “profession”, it would not have expressly designated it as an “occupation”.
The malpractice statute does not apply to occupation as differentiated from profession.
The summary judgment is vacated. The cause is remanded to the trial court for the entry of an order denying summary judgment on the ground stated.
All concurred.
MCLA 600.5805(3); MSA 27A.5805(3).
MCLA 600.5805(7); MSA 27A.5805(7).
We intimate no opinion on the issue that divided our Court in Kambas v St Joseph’s Mercy Hospital, 33 Mich App 127 (1971), leave granted 385 Mich 786. | [
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Per Curiam.
Plaintiff, Fred Turfe, received a jury judgment for $818.50 against defendant, Thomas Intihar, in an automobile negligence action.
On appeal plaintiff raises the issue that the trial court abused its discretion by restricting plaintiff’s rebuttal medical testimony. We find that the proffered rebuttal testimony could have been offered in plaintiff’s main case.
It is tbe general rule that whether evidence which could have been offered before resting may be given in rebuttal is a matter within the discretion of the trial court. An examination of the record does not demonstrate any abuse of discretion on the part of the trial court. People v Finnister, 33 Mich App 283 (1971); Lexchin v Mathews, 269 Mich 120 (1934); People v Utter, 217 Mich 74 (1921); and Beebe v Koshnic, 55 Mich 604 (1885).
Affirmed. | [
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J. H. Gillis, J.
On February 1, 1968, defendant Losh, as trustee under a trust mortgage, entered into an agreement with plaintiff Sadow to sell the Dryden Ski Area, real estate held by the defendant as trustee. At no time did the defendant seek or receive express approval from the mortgage note holders to sell the trust property to the plaintiff. Defendant Losh ultimately refused to complete the sale of the property, whereupon plaintiff instituted the present suit seeking specific performance or, in the alternative, damages.
Construing the terms of the trust instrument, the trial court determined that defendant-trustee Losh was not empowered to sell the trust property without the approval of a majority in interest of the bondholders. Having found that there was insufficient evidence to show that defendant had the required approval, and further, that plaintiff was on notice as to possible limitations on defendant’s authority, the trial court concluded that plaintiff was not entitled to specific performance or to' damages. From the decision of the trial court, plaintiff appeals.
The relevant portions of the articles of trust governing the powers of defendant-trustee are:
“ * * * and the trustee herein does covenant and agree that * * * he will 'act as trustee for the same and in the place and stead of said note-holders and he will do any and all things required of him by a majority vote of the noteholders * * * .”
We adopt the trial court’s construction of the articles :
“From this language one must readily conclude that the trustee does have the authority to sell the land if directed to do so by the majority in interest of the noteholders.
“The trust articles do not specifically prohibit him from selling of the land without a majority vote and clearly he has some implied authority to do some things without a majority vote. As to these matters, the agreement is incomplete and, perhaps, ambiguous.
“ ‘Generally speaking, the rights and powers of a trustee under a trust deed (trust mortgage) are derived from, and measured and limited by, the terms of the trust deed and, according to the decisions on the question, by any obligations secured thereby. * * * While it has been held that the powers of the trustee under a deed of trust will be construed strictly, and not liberally, it has been recognized that his powers are not limited to those expressly conferred, but include, as well, such as are conferred by necessary implication.’ [See Union Guardian Trust Co v Building Securities Corp, 280 Mich 144, aff’d on rehearing 280 Mich 717 (1937).]
“ ‘Thus, it has been held that even though a deed of trust does not confer on the trustee power, after acquiring title to tbe mortgaged property, to sell and convey it, a court of equity, * * * bas, * * * power to confer sucb power on the trustee.’ 59 CJS, Mortgages, § 299b, pp 372-374. [See Rudell v Union Guardian Trust Co, 295 Mich 157 (1940).]
“‘A trustee under a valid, recorded trust which neither contains a valid power of sale nor necessarily implies such a power but does not restrict sale, has power to convey lands if (a) all persons having a beneficial interest join with him in such conveyance or convey by separate instrument, or (b) such sale is authorized and confirmed by valid order of a court of competent jurisdiction.
“ ‘A trustee, under a valid, recorded trust which contains no express power of sale, may have an implied power of sale if the trust imposes on the trustee duties which cannot be performed in the absence of such power.’ Michigan Land Title Standards (2d ed), 6.9, 6.10.
“The trustee had no duties here which required him to sell the land prior to the natural expiration of the equity of redemption. Whatever his implied powers might be at a later date it is my opinion that he had no implied power to sell the land at the time it was sold.”
The trial judge found the following pertinent facts:
Defendant believed he was acting on behalf of, and with the authority of a majority in interest of, the noteholders in making what he thought was a binding sale. There was insufficient evidence to establish a grant of authority from said noteholders, and defendant did not, in fact, have the necessary authority.
Before he signed the agreement of sale, plaintiff knew that the property was subject to a trust mortgage, and that defendant was acting as trustee.
Both the trust articles and the notice of election of defendant as successor trustee were recorded. Defendant’s signature followed by the words “as trustee” were on the agreement of sale before plaintiff signed it. Reference was made to the existence of a trust mortgage in an addendum to the agreement of sale. Plaintiff nevertheless failed to make inquiry into the authority of defendant to execute the contract.
After examination of the entire record, we conclude that the findings of the trial judge were correct.
In view of the foregoing, plaintiff was charged with notice of the existence of the trust as a matter of law. He was bound to ascertain at his peril the terms of the trust, and to make careful inquiry into the authority of the trustee to enter into a binding agreement of sale.
“Any person dealing with a trustee must determine at his own risk the authority of such trustee to execute a proposed contract.” Nichols v Pospiech, 289 Mich 324, 333 (1939).
Since the defendant trustee exceeded his authority in executing the agreement of sale, the agreement was invalid. Gibney v Allen, 156 Mich 301 (1909). Having found that plaintiff was on notice, yet failed to make proper inquiry into defendant’s authority, the trial court correctly concluded that plaintiff was entitled to neither specific performance nor damages.
The judgment is affirmed, with costs to the prevailing parties.
All concurred.
Defendant refers to defendant Richard Losh.
Plaintiff refers to plaintiff Robert A. Sadow. | [
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Ryan, J.
We address a conflict which has a long and protracted history arising out of Saginaw Township’s 1971 tax assessment of appellee’s property. The original dispute between the parties was initially resolved by this Court in 1974 in a unanimous opinion written by Justice Fitzgerald. CAF Investment Co v State Tax Comm, 392 Mich 442; 221 NW2d 588 (1974). The Court reversed the decision of the tax commission and remanded to the Tax Tribunal for proceedings consistent with the opinion.
The Tax Tribunal thereafter conducted two weeks of hearings culminating in a lengthy opinion dated April 5, 1976. On appeal as of right to the Court of Appeals, the Tax Tribunal was again reversed and the case was remanded for redetermination. The Court of Appeals concluded that the tribunal failed to follow the dictates of this Court’s earlier decision. CAF Investment Co v Saginaw Twp, 79 Mich App 559; 262 NW2d 863 (1977).
We have again granted leave to appeal. 403 Mich 801 (1978).
I
The facts giving rise to this dispute are exten sively stated in our prior decision and need not be repeated at length here.
It suffices to say that C.A.F. disagrees with Saginaw Township’s assessed valuation of commercial property owned by the company. The property is encumbered by a long-term lease with the S.S. Kresge Company for a K-Mart store. The lease is not expected to expire, until 1998 if available options are exercised. Under the economic conditions for the assessment years now in dispute, 1971-1975, actual income under the lease is relatively low. Expert witnesses for both parties conceded, however, that the lease fairly reflects 1963 economic conditions, the year the lease was made.
When this case was here before, C.A.F. was challenging Saginaw Township’s true cash valuation of $1,442,364 for the subject property. That determination had been appealed to the State Tax Commission which essentially sustained the township’s earlier assessment. In making that decision, the tax commission relied heavily upon the testimony of Norman Daniels, a staff appraiser. Daniels had submitted a true cash valuation of $1,600,-000 based upon both the capitálization of income and the depreciated reproduction cost methods of appraisal. The basis for Daniels’ calculation of capitalized income value was a projection of the expected 1971 rental return for comparable property. Reduced to its simplest terms, this represented an "economic rental” value, of $2.00 per square foot based upon the operations of similar K-Mart properties. Implicit in the valuation was that the property was then available to rent in the marketplace, which of course was not the case.
On appeal to this Court, C.A.F. contended that "true cash value”, as defined by statute, could only be determined by reference to the actual income realized under the terms of the lease with S.S. Kresge. Basing his calculations of capitalized income value on actual income, the C.A.F. appraiser, Dean Nelson, arrived at a valuation of $787,500. C.A.F. contended that this figure accurately reflected true cash value. The tax commission’s reliance upon an "economic rental” or "hypothetical income” as a basis for appraisal, C.A.F. argued, had no reasonable relationship to the usual selling price or fair market value of the property which is the constitutional and statutory standard for determining true cash value.
The tax commission defended its valuation by pointing out that C.A.F.’s actual rental figures under the lease resulted in an unreasonably low capitalized valuation. The tax commission equated the statutory language "economic income” with the appraisal term "economic rental”. Thus, the tax commission contended that if property is leased under a long-term lease for a rental which in later years proves unduly low in the face of economic changes, actual rent could be ignored and the potential rental income of the property on the open market could be utilized.
Justice Fitzgerald incisively framed the issue presented to this Court as follows:
"[W]hether, under Michigan law, the tax commission was entitled to consider and give weight to evidence of valuation based upon a rate of return which comparable, unencumbered property could earn in the present marketplace in the face of an existing unfavorable long-term lease with an actual rate of return which is substantially less than the present 'going rate’.” 392 Mich 442, 447.
This Court held that under the circumstances of the case presented, the answer was, "No”. It was held that, as used in the statute, "economic income” meant "actual income”. Id., 454. To the extent that the capitalization of income method is used for determining true cash value, the assessor was obligated to use the actual income under the existing long-term lease as the basis for his calculations. Id. The record indicated that the lease was the product of an arm’s-length transaction and fairly reflected economic conditions at the outset. To the extent that the tax commission permitted actual income to be ignored, the township’s valuation was clearly in error. A hypothetical rental income based on comparable properties leased at more favorable rates was an improper basis for determining true cash value. Id., 455.
This Court reversed the tax commission and remanded for a determination of true cash value based upon actual income. Due to a procedural error also committed by the tax commission, a full de novo hearing was held by the Tax Tribunal.
Not surprisingly, evidence developed at the hearing on remand essentially mirrored that taken at the original hearing. The C.A.F. appraiser, Dean Nelson, testified on behalf of C.A.F. and again arrived at a 1971 assessed valuation of $787,500 by capitalizing actual income under the existing long-term lease. Nelson expanded his appraisal to cover the intervening years to 1975. The highest valuation under his calculations was $950,-500 for the assessment year 1974. These figures, according to Nelson, represented the fair market value of the property to a commercial investor. Nelson opined that investors would look at the cash flow under the existing lease to determine the fair market value of the property.
Norman Daniels again testified on behalf of the township. His testimony and appraisal were corroborated by a fellow tax commission appraiser, Russell Galvin. Both testified that the most reliable method of determining the fair market value of the property was by the capitalization of income method. Two alternative methods of valuation were utilized to check the validity of the capitalization of income method. Both witnesses determined that the valuations for the assessment years in question were as follows: $1,509,000 in 1971; $1,570,000 in 1972; $1,640,000 in 1973; $1,705,000 in 1974; and $1,771,000 in 1975.
Daniels and Galvin testified that these figures reflected the true cash value of the entire property and not just the value of the lessor’s interest under the lease as reflected by use of actual rental income alone as suggested by the C.A.F. appraiser. On cross-examination both experts explained that, in essence, this meant that they looked to the hypothetical rental income of the subject property to make their calculations and ignored actual rent received under the lease. They even went so far as to say that to determine the total value of the subject property, actual rent received was irrelevant. Daniels admitted that with the exception of a change in the vacancy factor, there was no difference between the first appraisal submitted originally to the tax commission and the second appraisal provided to the Tax Tribunal at this hearing.
After taking the above testimony the Tax Tribunal made supplemental findings of fact, none of which are pertinent to the resolution of the present appeal, The Tax Tribunal then framed the legal issue which it deemed necessary for it to resolve in the dispute presented: "Where real property is subject to a long-term lease which currently provides less than the normal market rent, is such property to be assessed on a value predicated on the actual level of income?”
After a lengthy statutory analysis, the Tax Tribunal essentially reaffirmed the tax commission’s earlier assessment of the C.A.F. property. With modification to the capitalization rates and expense figures, the Tax Tribunal predicated the value of the property on the capitalization of income method of appraisal as employed by the tax commission appraiser, Norman Daniels. Market rent in lieu of actual income was utilized to reach a valuation of $1,389,452 for the assessment years 1971-1974. The 1975 assessment year valuation was determined to be $1,473,506.
Emphasized throughout the opinion was the Tax Tribunal’s belief that the Legislature did not intend the use of actual income to determine true cash value when that figure represented only a portion of the commercial income potential of the property involved. The appraisal submitted by C.A.F. appraiser Dean Nelson, consisting of a capitalization of actual income under the long-term lease, was considered to be "of little, if any, evidentiary value”. The foremost reason for its rejection was the appraisal’s failure to predicate valuation on "the amount of income the subject property is capable of producing”.
The Court of Appeals reversed the decision of the Tax Tribunal and again remanded. The Court reasoned that our prior decision required that capitalization of actual income form the basis of the tribunal’s calculations and held that by ignoring actual income and adopting the appraisal based upon the rate of return of comparable unencumbered property, the Tax Tribunal committed a clear error of law. CAF Investment Co v Saginaw Twp, 79 Mich App 559, 546-565; 262 NW2d 863 (1977).
On appeal, Saginaw Township contends that the Court of Appeals misconstrued our earlier decision; that our decision did not require the valuation of C.A.F.’s property to be based solely on actual rent; that actual rent need only be considered along with other relevant factors; and that if in light of unusual circumstances actual income did not reflect the true cash value of the entire property, actual income could be properly disregarded. The township also argues that to predicate valuation on the actual income received under a long-term lease allows a taxpayer to effectively "freeze” his real estate tax assessment against future inflation of land values which violates the constitutional requirement of uniformity of assessment.
C.A.F. responds that the Court of Appeals applied the law of the case to the Tax Tribunal decision and correctly found it to be inconsistent; that the only appraisal which conformed with the principles of true cash value mandated by our prior decision was Dean Nelson’s; and that the Tax Tribunal’s partial reliance upon an appraisal based on hypothetical income was in clear conflict with our prior decision. /
II
The law of the case doctrine dispenses with the need for this Court to again consider legal questions determined by our prior decision and necessary to it. As generally stated, the doctrine is that if an appellate court has passed on a legal question and remanded the case for further proceedings, the legal questions thus determined by the appellate court will not be differently determined on a subsequent appeal in the same case where the facts remain materially the same. Corporation & Securities Comm v American Motors Corp, 379 Mich 531; 152 NW2d 666 (1967); Palazzolo v Sackett, 254 Mich 289; 236 NW 786 (1931); American Ins Co of Newark v Martinek, 216 Mich 421; 185 NW 683 (1921); Allen v Michigan Bell Telephone Co, 61 Mich App 62; 232 NW2d 302 (1975); Topps-Toeller, Inc v Lansing, 47 Mich App 720; 209 NW2d 843 (1973).
The application of this principle was recognized early in the judicial history of this state. In Pierce v Underwood, 112 Mich 186-187; 70 NW 419 (1897), Justice Montgomery stated:
"This case was before the court at a former term, and is reported in 103 Mich 62 [61 NW 344], to which reference is made for a statement of the facts. The case has been retried at the circuit, and has resulted in a verdict and judgment in favor of the plaintiff. The brief of the appellant raises the same questions which were discussed in the former case and reargues them. We cannot review the questions which were there disposed of. If it is claimed that the conclusions of law reached on the former hearing were erroneous, the remedy is by a motion for a rehearing, but a ruling of this court in a case becomes the law of the case to govern a new trial, and is not subject to review thereafter.”
The controlling facts in the instant dispute remain virtually identical with those which obtained when we decided this dispute the first time, other than the extension of the valuations through 1975. The appraisals submitted by the parties at the hearing on remand, in essence, utilized the same methods of valuation and arrived at virtually the same determinations of true cash value as before. The issues framed by the township on this appeal are nothing more than polemic restatements of the question decided on prior appeal.
Determinative in the present appeal is the Tax Tribunal’s reliance on the appraisal of Norman Daniels which substituted the economic rental or hypothetical income for the actual rent of the subject property under the long-term lease, despite this Court’s prior rejection of that criterion as a proper basis of valuation. The cross-examination of Daniels at the hearing on remand was, in part, as follows:
"Q. Well, but isn’t it true, Mr. Daniels, that in arriving at total value in this case, the actual rent received from K-Mart was irrelevant?
"A. What’s that again?
”Q. In arriving at total value, wasn’t the actual rent received by C.A.F. from K-Mart irrelevant?
"A. In valuing the total property value, yes.
"Q. Yes, it was irrelevant?
"A. Yes.
”Q. So if you had not considered any actual rent at all, you would have come out exactly the same in your total value?
"A. In valuing the fee simple estate, yes.”
The Tax Tribunal’s acceptance of Daniels’ appraisal based on the use of hypothetical income is evidenced by its adoption of the $2.00 per square foot rental income figure used by Daniels as opposed to the $1.30 per square foot actual rental figure. The error in basing valuation upon the rental value of comparable property was clearly stated by Justice Fitzgerald in our prior decision:
"The State Tax Commission’s ultimate determination of true cash value of $1,440,000 is based in part upon the testimony of Norman Daniels on 'economic income’ capitalization. To the extent it is based upon such evidence, the ultimate valuation relies upon a hypothetical rental income without consideration of actual rental income demonstrably related to fair market value. Such a valuation does not comport with the constitutional and statutory standard of 'true cash value’.” 392 Mich at 454-455.
Remarkably, the Tax Tribunal is guilty of the same error for which we reversed the tax commission previously. It was presumptuous for the Tax Tribunal to embark upon a legal analysis of a question that was clearly presented to and decided by this Court on prior appeal. The Tax Tribunal’s division of the C.A.F. property into "leased fee” and "leasehold” interests for purposes of establishing the true cash value of the "entire” property is an inappropriate subterfuge to justify the tribunal’s determination to reject the use of actual income when it falls below the potential rental value of comparable properties currently on the market, and is unwarranted. The tax commission was reversed by this Court in our prior decision for its use of hypothetical income rather than actual income to reach a projected income figure. In its decision on remand, the tribunal has attempted to justify essentially the same method of valuation. In fact, the Tax Tribunal used the same "economic rental” figure of $2.00 per square foot supplied by Norman Daniels that the tax commission had employed in its calculations. We hold once again that such a method of valuation is erroneous.
The Tax Tribunal’s reasoning upon remand, and the township’s argument on appeal, is that our prior decision required only that actual income be "considered” in determining true cash value and that once it had given "consideration” to actual income and determined that it did not accurately reflect current rates of return of comparable property on the open market, actual income could be ignored.
The Tax Tribunal’s estimation of the significance this Court placed on actual income in this dispute falls woefully short of the mark. All the appraisers testified that the capitalization of income method was the best indication of value. Commercial investors rely heavily upon cash flow represented by the capitalization of actual income to judge the fair market value of property. Having chosen that method of valuation, consideration of "economic income” as provided by statute was imperative. Our prior decision left no doubt that "economic income” meant nothing other than actual income under the circumstances of this case. CAF Investment Co v State Tax Comm, supra, 454. We said as much: "[I]n this case the record indicates that long-term lease rental fairly reflects economic circumstances at the outset of the lease term and bears a demonstrable relation to true cash value”. Id., 456, fn 6. Other than the fact that actual income was less than the rate of return comparable property might receive under current market conditions, there was no suggestion that the lease was arrived at other than by arm’s-length negotiations.
A
A calculation under the capitalization-of-income method yields a projected income figure. Often, as here, that figure alone will reflect the fair market value of the property. Saginaw Township and the Tax Tribunal have maintained throughout the course of these proceedings, however, that projected income, as reflected by the capitalization of actual income received under the long-term lease, does not reflect the true cash value of the entire property. Instead, they argue, any projected income figure calculated on the basis.of actual income values only the lessor’s (C.A.F) interest in the property and ignores the lessee’s (K-Mart) interest under the lease, and that the lessee has a measurable interest in the land due to the economic advantage it enjoys by renting property for an amount that is less than the prevailing rate in the current market.
Whatever merit that proposition might have in the science of real estate appraisal, consideration of a so-called lessee’s interest by the means employed by the Tax Tribunal is foreclosed by our prior decision. Testimony of the tax commission experts was that in order to value the entire property, consisting of both the lessor’s and lessee’s interest, anytime actual income fell below the market rent or hypothetical income of comparable property actual income would be ignored, and it was ignored in this case for that very reason.
The fault of this methodology is that true cash value must equal the fair market value of the property to the owner. All experts conceded that economic income most accurately reflected that value. And, on the facts before us, economic income was nothing other than actual income, since it had been determined that for the years in question the lease rental reflected current economic circumstances and bore a demonstrable relation to true cash value. Moreover, to equate economic income with hypothetical income in every situation where actual rent under a long-term lease is less than the prevailing market rental would be to ignore the effect of the lease on a prospective investor’s judgment regarding the fair market value of the property. That was the very situation confronting this Court on prior appeal. We refused to allow the consideration of actual income to be diluted by reference to the potential income of comparable property then, and we do so now.
B
In other cases there may well be other circumstances or considerations that necessarily require adjustment to the projected actual income figure to arrive at an accurate true cash valuation. These were mentioned in our prior decision and apparently were a source of the tribunal’s confusion on remand. Justice Fitzgerald stated in 392 Mich at 455-456:
"By the holding in this case, we do not mean to suggest that the tax assessor, in utilizing the income capitalization approach to valuation, is limited to, and must accept, the actual rental figure under an existing long-term lease as the sole measure of projected income and basis for capitalization. In most cases such an approach to true cash value would lead to distorted valuation. Such factors as the right to repossession of the land at the end of the lease, and the length of the lease term often suggest that the projected income figure should at least in part be adjusted to reflect current market conditions. It may also be appropriate to adjust the projected income figure in circumstances where financing was obtained at a much more favorable rate than the current going rate, and there is a high current rate of capitalization, in order to reflect the fact that the income-earning capacity of the property is greater than consideration of the unfavorable long-term lease rental at current capitalization rates would alone suggest. Furthermore, we can envision circumstances in which it may be inappropriate to consider lease term rental as a component of projected income. Finally, there may be such facts, peculiar to the circumstances under consideration, as would indicate that the income capitalization approach is too speculative to be a reliable indicator of valuation. In such circumstances the tax assessor may base his assessment upon a more reliable method of valuation.” (Footnotes omitted; emphasis added.)
Emphasized are certain "adjustments” to project income. The factors mentioned are by no means exhaustive. They were mentioned to illustrate that a projected income figure arrived at by virtue of a capitalization of actual income may not reflect a truly accurate picture of a property’s fair market value. See Port Sheldon Twp v Ottawa County, 80 Mich App 91; 263 NW2d 299 (1977); Ramblewood Associates v City of Wyoming, 82 Mich App 342; 266 NW2d 817 (1978); Wolverine Tower Associates v Ann Arbor, 96 Mich App 780; 293 NW2d 669 (1980). They were not mentioned as reasons to ignore the use of actual income in calculating projected income in the instant case.
The right to repossession and the length of the lease in the instant case were accorded value in the Tax Tribunal’s calculations by adjusting the rate of capitalization.
C
The precise error in the tribunal’s calculation of true cash value having been indicated, and the Tax Tribunal having made detailed findings of fact on the expense and capitalization figures to be utilized, the actual per square foot rental value need now only be "plugged into” the formula to arrive at projected income.
Ill
Saginaw Township contends that to predicate value of a given property upon the taxpayer’s rate of return under an economically unfavorable lease, while on the other hand valuating unencumbered property at current market level, is violative of the constitutional requirements of uniformity of assessment and due process.
The Tax Tribunal expressed much the same concern. In the Tax Tribunal’s opinion not only must a valuation method reflect the value of propérty on the investment market, but it must also produce uniformity of assessment. Because a determination of projected income based on actual rental would depend upon the rental provided in the long-term lease, the Tax Tribunal felt uniformity of assessment could never be achieved unless market rent was utilized in every calculation.
We are not unmindful of the primacy of uniformity and equality in assessment. See Allied Supermarkets, Inc v Detroit, 391 Mich 460; 216 NW2d 755 (1974); In re Appeal of General Motors Corp, 376 Mich 373; 137 NW2d 161 (1965). The township’s argument, however, begs the question. The touchstone of uniform assessment is the true cash value or usual selling price of the property. Assessment decisions must recognize limitations or restrictions which have a bearing on the selling price of property. Brae Burn, Inc v Bloomfield Hills, 350 Mich 425; 86 NW2d 166 (1957).
The township’s appraiser testified that the property in the instant case would be bought and sold based upon the actual contract rent received under the long-term lease. We find that with certain adjustments this represented the true cash value of the property. Uniformity is achieved by assessing all property with the same true cash value at a consistent level.
We find C.A.F.’s answer to the Tax Tribunal’s concern for uniformity of assessment persuasive. Properties may have similar physical characteristics, but differences in economic factors will determine the usual selling price of the properties. Properties encumbered by different lease terms, zoning restrictions, or deed restrictions, although physically similar, would not have the same cash value on the open market. See Kensington Hills Development Co v Milford Twp, 10 Mich App 368; 159 NW2d 330 (1968); Lochmoor Club v Grosse Pointe Woods, 10 Mich App 394; 159 NW2d 756 (1968). It would be incongruous, indeed violative of the rule of uniformity, to assess two properties the same despite the fact that their usual selling prices are different.
We find no uniformity or due process violations in an assessment premised on true cash value as defined by this Court.
IV
We conclude that in failing to use actual income as the basis of its capitalization of income, the Tax Tribunal disregarded the mandate of CAF Investment Co v State Tax Comm, 392 Mich 442; 221 NW2d 588 (1974), and thereby committed error.
We direct the Tax Tribunal to enter a specific order forthwith and bring an end to this excessively protracted litigation.
Using the taxpayer’s actual income and expenses (which were accepted by the Tax Tribunal as accurate), and vacancy factor, and the rate of return and tax rate adopted by the Tax Tribunal, the values for 1971 and 1975 are as follows:
1971 1975
$1.31/sf $1.63/sf
Gross income 141,000 174.554
Vacancy and credit loss -2,820 (2%) -0-
Effective gross income 138,180 174.554
Expenses -33,866 -41,064
Net Income 104,314 133,490
Overall rate 10.00% 10.50%
Tax rate 2.23% 2.25%
12.23% 12.75%
Value Estimate:
197X_ 104,314. $852,935.40
1993
1975_ 133,490. $1,046,980.30
.1275
The 1971 value was applied to the years 1972, 1973, and 1974 as well. Thus, capitalization of actual income yields the following figures:
Tax Year Cash Value Assessment Level Assessment
1971 $ 852,935.40 17.04% $145,340.19
1972 852.935.40 50.00% 426.467.70
1973 852.935.40 48.44% 413,161.90
1974 852.935.40 50.00% 426.467.70
1975 1,046,980.30 50.00% 523,490.15
It is hereby ordered that the Tax Tribunal enter a final order in accordance with the foregoing figures. Interest on any refund shall be calculated as prescribed by MCL 205.737(4); MSA 7.650(37)(4).
No costs, a public question being involved.
Coleman, C.J., and Kavanagh and Levin, JJ., concurred with Ryan, J.
During the course of the appeal, the Legislature enacted the Tax Tribunal Act which transferred jurisdiction over property tax appeals from the tax commission to the Tax Tribunal. MCL 205.701 et seq.; MSA 7.650(1) et seq.
"True cash value” is the basis for the uniform general ad valorem taxation of real property. Const 1963, art 9, § 3. The Legislature, during the period in question, defined "true cash value” in MCL 211.27; MSA 7.27, to mean, in essence, the "usual selling price” of such property on the open market, taking into account various other factors, including the "present economic income of structures”.
MCL 211.27; MSA 7.27 provided in pertinent part:
" 'Cash value’ means the usual selling price at the place where the property to which the term is applied shall be at the time of assessment, being the price which could be obtained for the property at private sale, and not at forced or auction sale. Any sale or other disposition by the state or any agency or political subdivision of lands acquired for delinquent taxes or any appraisal made in connection therewith shall not be considered as controlling evidence of true cash value for assessment purposes. In determining the value the assessor shall also consider the advantages and disadvantages of location, quality of soil, zoning, existing use, present economic income of structures, including farm structures and present economic income of land when the land is being farmed or otherwise put to income producing use, quantity and value of standing timber, water power and privileges, mines, minerals, quarries, or other valuable deposits known to be available therein and their value.
"Except as hereinafter provided, property shall be assessed at 50% of its true cash value in accordance with article 9, section 3 of the constitution.” 1973 PA 109.
This section has since been amended by 1976 PA 293, § 1; 1976 PA 411, § 1; and 1978 PA 25, § 1.
The terms "economic rental”, "hypothetical rental income”, "potential income/rent”, and "rate of return on comparable property” are used interchangeably throughout this opinion.
It should be noted that our prior decision left open the prospect of utilizing other appraisal methods to determine true cash value in the appropriate circumstances. See 392 Mich at 450, fn 2. It was the unanimous opinion of the appraisers in the instant case that the capitalization of income method reflected the most accurate and reasonable assessment of fair market valuation and it is that method, therefore, which is the proper basis for the tribunal’s assessment.
The Tax Tribunal developed the following additional facts and circumstances at the hearing on remand:
"1. At the time of the initial assessment in 1971, that triggered this appeal, petitioner refused to provide the appraisal firm that reappraised all the property in the assessment district with the income and expense data on which this appeal is based.
"2. During this hearing petitioner, represented by counsel only at the hearing, objected to the introduction of the mortgage and to petitioner’s balance sheet for December 31, 1966, which were both introduced by respondent as its Exhibits No. 11 and 13, respectively, which were admitted as evidence.
"3. The balance sheet (respondent’s Exhibit 13) indicated the total cost of subject property was $1,057,318.88, while the mortgage (respondent’s Exhibit 11) indicated petitioner was loaned $1,250,000 on subject property on November 15, 1963, or for a mortgage loan of $192,681 in excess of cost. Petitioner offered no explanation for this excess.
"4. That there are only three or four developers in the country who have been able to develop 'K-Mart’ properties. There was no adequate explanation offered as to why this was so.
"5. That S.S. Kresge Company is a very desirable 'Triple AAA’ [sic] tenant from an economical standpoint.
"6. That petitioner’s appraiser, in making his appraisal predicated on lease rental income only, did so on instructions of petitioner.
"7. One of respondent’s witnesses, a Level IV certification appraiser for the State Tax Commission, spent eight weeks preparing the appraisal on this property utilizing a market rent income valuation approach.
"8. That assessors cannot compel taxpayers to furnish income and expense data for use in appraising on an income valuation method.
"9. That assessors can only obtain such data from those that are willing to give it.
"10. That both petitioner’s and respondent’s appraisers made appraisals for the tax years 1971 and 1975, respectively, and at the request of the tribunal prepared and testified to estimates of value for the intervening 1972, 1973 and 1974 tax years.
"11. That petitioner’s appraiser had not prepared an appraisal based on the 'cost’ or 'market’ approach on the grounds that the income method was the best method and that in utilizing the lease rental income in lieu of market rent in 1975 he was acting on instructions of his client, the petitioner.
"12. Respondent’s other expert witness appraiser prepared a 'cost’ and 'market’ approach appraisal for 1971 but, together with respondent’s first expert witness who prepared the 'income’ method appraisal, agreed that the 'income’ method was the best method to be used with the subject property provided that the value could not be predicated on the lease rental income alone when such income is substandard compared to market rent and that in this case 'market rent’ was used by them in valuing the property.”
It is contended by the township and Justices Fitzgerald and Moody that when we directed the Tax Tribunal to "consider” actual income in our previous opinion, 392 Mich 456, fn 6, we required only that the tribunal think about using actual income as the basis of its calculation, with the option to disregard it if it so chose. The contention is untenable. To construe "consider” in that manner is manifestly illogical since the Tax Tribunal (then the tax commission) had received into evidence at the first hearing, the one reviewed in our previous opinion, the testimony of Dean Nelson, the C.A.F. appraiser, who maintained that the true cash value of the property in question must be determined with reference to actual income. Patently, when we ordered the Tax Tribunal to "consider” actual income it had already thought about, and rejected, its use. Indeed, we quoted the tribunal’s recognition that its valuation of the property "was arrived at after 'consideration of all the information contained [in the noted facts]’ ”. 392 Mich 447 (quoting the Tax Tribunal) (emphasis added; brackets in original). Against this backdrop it is plain that the tribunal had considered actual income when we ordered it to "consider” the same. In this context, the only reasonable interpretation of "consider” is "use”.
It should be noted that the appraiser for C.A.F. did adjust the capitalization rate to reflect the owner’s reversionary interest under the lease. The Tax Tribunal presumably acknowledged the validity of providing for the valuation of that interest by such an adjustment by further modifying the capitalization rate before employing it in their calculations of projected income.
See Part IV, post.
The Tax Tribunal set forth its calculations as follows:
1971
Gross Income $214,522 (at $2/sq. ft.)
Vacancy & Credit Loss -10,726 (5%)
Effective Gross Income 203,796
Expenses -33,866
Net Income $169,330
Overall Rate 10.00 %
Tax Rate 2.23
Capitalization Rate 12.23 %
Value estimate by income approach:
$169,930 _ $1,389,452
.1223
1975
Gross Income $241,339 (at $2.25/sq. ft.)
Vacancy & Credit Loss -12,067 (5%)
Effective Gross Income 229,272
Expenses -41,400
Net Income $187,872
Overall Rate 10.50 %
Tax Rate 2.25
Capitalization Rate 12.75 %
Value estimate by income approach:
$187’872 = $1,473,506
.1275
The Tax Tribunal made findings of fact that the actual rental income per square foot under the long-term lease was $1.30 and $1.60 for the years 1971 and 1975, respectively.
Const 1963, art 9, § 3, provides, in part, as follows:
“The legislature shall provide for the determination of true cash value of such property; the proportion of true cash value at which such property shall be uniformly assessed * *
Pursuant to this constitutional grant of authority, the Legislature enacted MCL 211.27; MSA 7.27, which has been set forth and discussed at length above.
As to the years 1972, 1973 and 1974, the Tax Tribunal explained that the parties had submitted "estimates of value” for those years but characterized "these opinions” as "unsubstantiated estimates” and stated its conclusion that it should "restrict their use solely to determining that no unusual fluctuation of true cash value occurred in the intervening tax years”. The Tax Tribunal concluded that "[t]here [was] no evidence that such a fluctuation occurred”. | [
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Per Curiam.
Pursuant to Administrative Order 1977-4, 400 Mich lxvii (1977), defendant has requested that this Court review his convictions. This case presents two sentencing questions arising under Michigan’s felony-firearm statute, MCL 750.227b; MSA 28.424(2). We hold that multiple terms of imprisonment for felony-firearm must be served concurrently, notwithstanding the fact that each term of imprisonment for felony-firearm is to be served consecutively with and preceding any term of imprisonment imposed for the commission of the felony. We further hold that a five-year term of imprisonment for a second offense of felony-firearm cannot be imposed unless the second offense is committed subsequent to the first conviction.
I
On two separate occasions, defendant committed robbery while armed with a firearm. Separate prosecutions were thereafter undertaken and defendant was in each case charged with one count of armed robbery, MCL 750.529; MSA 28.797, and one count of felony-firearm, MCL 750.227b; MSA 28.424(2). At a single plea proceeding, defendant pled guilty to all four felony counts. Defendant had not previously been convicted of felony-firearm.
The trial judge thereafter sentenced the defendant to prison for armed robbery. He also sentenced the defendant to a two-year term of impris onment for the felony-firearm offense which occurred first and to a five-year term of imprisonment for the felony-firearm offense which occurred second. He properly directed that each term of imprisonment for felony-firearm was to be served consecutively with and preceding the accompanying term of imprisonment imposed for armed robbery. He properly directed that the two terms of imprisonment for armed robbery be served with one another. He further directed, however, that the two terms of imprisonment imposed for felony-firearm be served consecutively. Defendant was thus obliged to serve a seven-year term of imprisonment for felony-firearm prior to beginning his term of imprisonment for the second armed robbery conviction. The Court of Appeals affirmed.
II
Absent statutory authority for imposing a consecutive sentence, it is the rule in this state to impose concurrent sentences, People v Gallagher, 404 Mich 429, 439; 273 NW2d 440 (1979). The felony-firearm statute reads, in full, as follows:
"(1) A person who carries or has in his possession a firearm at the time he commits or attempts to commit a felony, except the violation of section 227 or section 227a, is guilty of a felony, and shall be imprisoned for 2 years. Upon a second conviction under this section, the person shall be imprisoned for 5 years. Upon a third or subsequent conviction under this section, the person shall be imprisoned for 10 years.
"(2) The term of imprisonment prescribed by this section shall be in addition to the sentence imposed for the conviction of the felony or the attempt to commit the felony, and shall be served consecutively with and preceding any term of imprisonment imposed for the conviction of the felony or attempt to commit the felony.
"(3) The term of imprisonment imposed under this section shall not be suspended. The person subject to the sentence mandated by this section shall not be eligible for parole or probation during the mandatory term imposed pursuant to subsection (1).”
A careful reading of subdivision (2) reveals that the Legislature has only directed that the sentence for felony-firearm be served prior to and consecutively with any term of imprisonment imposed for the felony. The statute neither compels nor authorizes a trial judge to impose consecutive multiple sentences for felony-firearm. Thus we conclude that the trial judge erred in this case in directing that defendant’s two sentences for felony-firearm be served consecutively.
Ill
Defendant pled guilty to two counts of felony-firearm at a single plea proceeding. The offense which occurred second was treated as a second offense for sentencing purposes and the defendant received a five-year term of imprisonment therefor. The statute indicates that the five-year term is to be given to one who sustains "a second conviction under this section”. It is by no means clear that the Legislature intended the result found in this case. There are a number of purposes served when the Legislature provides increasing punishment for repeat offenders. These include deterrence and the proper desire of society to provide more severe punishment for a person who declines to change his or her ways following an opportunity to reform. These purposes are not served by imposing a more severe sentence on the day when a defendant first pleads guilty, and we accordingly believe that the Legislature intended that a five-year term of imprisonment for a second conviction should only be imposed where the second offense is subsequent to the first conviction.
Furthermore, this position is consistent with the well settled "rule of lenity” that has been developed by the United States Supreme Court: "[A]mbiguity concerning the ambit of criminal statutes should be resolved in favor of lenity”. Rewis v United States, 401 US 808, 812; 91 S Ct 1056; 28 L Ed 2d 493 (1971). In the context of sentencing, "[t]his policy of lenity means that the Court will not interpret a federal criminal statute so as to increase the penalty that it places on an individual when such an interpretation can be based on no more than a guess as to what Congress intended”. Ladner v United States, 358 US 169, 178; 79 S Ct 209; 3 L Ed 2d 199 (1958), quoted in Whalen v United States, 445 US 684, 695 fn 10; 100 S Ct 1432; 63 L Ed 2d 715 (1980).
Accordingly, the request filed by the defendant under Administrative Order 1977-4 is treated as an application for leave to appeal and, pursuant to GCR 1963, 853.2(4), in lieu of granting leave to appeal, we remand the case to the Recorder’s Court of Detroit for resentencing in a manner consistent with this opinion. The judgment of the Court of Appeals is thus modified. Leave to appeal is otherwise denied.
Williams, Levin, Ryan, and Blair Moody, Jr., JJ., concurred.
The trial court did not specify which felony-firearm sentence was to be served first.
We do not today consider the propriety of directing that multiple sentences for felony-firearm be served consecutively where such a judgment is imposed on a defendant whose actions permit consecutive sentencing under another theory. | [
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Fitzgerald, J.
These cases arose out of disputes between the plaintiff taxpayers and the Michigan Department of Treasury concerning the relationship between Michigan’s now-repealed corporate income tax and the Federal income tax. The issue in Production Credit Ass’ns v Dep’t of Treasury (hereafter "Production Credit”) is whether Michigan’s Income Tax Act required a corporation to carry back its post-January 1, 1968 net operating losses to the same years as it had carried back such losses for Federal income tax purposes. The issues in Detroit Edison Co v Dep’t of Treasury (hereafter "Detroit Edison”) are whether a corporate taxpayer was entitled to use the fair market value of its property as of January 1, 1968 as a basis for depreciation and whether a corporate taxpayer was entitled to deduct depreciation in calculating its Michigan income tax liability on assets which had been fully amortized for Federal income tax purposes before January 1, 1968 under a now-repealed section of the Federal Internal Revenue Code.
Production Credit plaintiffs each claimed income tax refunds in amended returns based on a carry-back or carry-over of 1968 or 1969 net operating losses. Each of the Production Credit Associations sought to carry back a 1969 net operating loss to offset it against 1968 Michigan taxable income, while the Evening News Association sought to carry over a 1968 net operating loss to be applied to 1969 Michigan taxable income. On their Federal income tax returns plaintiffs had applied their net operating losses to years predating the effective date (January 1, 1968) of the Michigan Income Tax Act.
The Revenue Division of the Michigan Department of Treasury denied the claims for refund, taking the position that because the Michigan tax base is to be identical to Federal taxable income each plaintiff’s net operating loss had been used up when applied against Federal taxable income in years predating the effective date of Michigan’s Income Tax Act. Each plaintiff then filed a circuit court action to recover the refund. The circuit court granted plaintiffs’ motions for summary judgment. The Court of Appeals reversed. 68 Mich App 409; 242 NW2d 794 (1976).
Detroit Edison claimed a deduction on its first Michigan corporate income tax return for depreciation attributable to certain emergency defense facilities placed into service between 1941 and 1958. No depreciation deduction for the facilities was reported on Detroit Edison’s Federal income tax return for 1968 because Detroit Edison had elected to amortize, in lieu of depreciation, the original cost of those facilities over a period of 60 months pursuant to § 168 and its predecessors, §§ 124 and 124A, of the Internal Revenue Code, and certificates of necessity obtained in conjunction therewith. The facilities had been fully amortized before the effective date of the Michigan Income Tax Act. The Revenue Division disallowed the depreciation deduction attributable to the facilities claimed on Detroit Edison’s 1968 Michigan return and Detroit Edison paid an additional tax of $162,342.63.
Three months after Detroit Edison’s depreciation deduction was disallowed, plaintiff filed an amended return. On the amended return Detroit Edison used as a basis for all its depreciable property, including the emergency defense facilities, the fair market value as of January 1, 1968 rather than the original cost reported on its initial return. The fair market value was amortized over the remaining years of useful life. Accordingly, the depreciation deduction increased, and Detroit Edison filed, in conjunction with its amended return, a petition for refund of tax in the amount of $2,352,421.
After the Revenue Division rejected Detroit Edison’s amended return, plaintiff filed a circuit court complaint. Both Detroit Edison and the Revenue Division moved for summary judgment. The circuit court denied both motions finding that "there is a genuine issue of fact and law as to the proper interpretation of the 1967 Public Act 281”. Defendants consented to plaintiff’s application for leave to appeal to the Court of Appeals. The Court of Appeals ruled in favor of the Revenue Division, 72 Mich App 426; 250 NW2d 85 (1976), finding its reasoning in Production Credit controlling.
The disputes herein concern differing interpretations of three sections of the Michigan Income Tax Act.
Section 2(3) of the Michigan Income Tax Act provided:
"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).
Section 12(3) read:
" 'Net profits’ means the net gain from the operation of a business, profession or enterprise, after provision for all costs and expenses incurred in the conduct thereof, determined on either a cash or accrual method, on the same basis as provided for in the internal revenue code for federal income tax purposes, but without deduction of any taxes imposed on or measured by income including taxes imposed by this act and without deduction of net operating loss carry-over or capital loss carry-over sustained prior to January 1, 1968.” MCL 206.12; MSA 7.557(112).
Section 32 stated:
" 'Taxable income’ in the case of a corporation other than a financial institution means:
"(a) Net profits as defined in this act subject to the following adjustments * * * .” MCL 206.32; MSA 7.557(132).
The fundamental rule of statutory construction is to ascertain and give effect to the legislative intention, Lansing v Lansing Twp, 356 Mich 641; 97 NW2d 804 (1959). The Revenue Division argues that § 2(3) is dispositive of the questions involved here. The Legislature’s expression of an intention that "the income subject to tax be the same as taxable income * * * in the internal revenue code” requires identical computations. The Revenue Division explains that the Michigan income tax is a "piggy-back” on the Federal income tax. The Court of Appeals accepted that position when it found a legislative "intent to equate the dollar amount of the taxable income for state income tax purposes with the dollar amount of the taxable income for Federal income tax purposes”. 68 Mich App 409, 417.
Plaintiff taxpayers, on the other hand, contend that the legislative intent is expressed in that part of § 2(3) which reads: "except as otherwise provided in this act”. Because corporate taxable income is defined in § 32 in terms of "net profits” (which is "net gain * * * after provision for all costs and expenses”, § 12[3]), the Legislature has otherwise provided in the case of corporations. While the Internal Revenue Code may be used as a frame of reference, the piggy-back approach, requiring identical computation methods, is unduly simplistic.
It is axiomatic that words in a statute are to be interpreted according to their commonly accepted meanings, Detroit v Tygard, 381 Mich 271; 161 NW2d 1 (1968). The fact that the Income Tax Act is replete with terms of art not specifically defined in the act 6 is indicative of a legislative intent that the act be interpreted in accordance with the experience and understanding of those who would be expected to use and interpret the act. In addition to directing our attention to the Internal Revenue Code by expressing its intention in § 2(3), the Legislature has stated in §2(2) that: "[a]ny 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”.
The Legislature’s expression that Michigan taxable income is to be the same as Federal taxable income, yet direction in § 32 that corporate taxable income is to be "net profits” (defined in § 12[3] as "net gain” after "provision for all costs and expenses”) is not without ambiguity. We do not, however, conclude, that because the Legislature did not define corporate taxable income as Federal taxable income in § 32, totally different tax computations for the two sovereigns were contemplated. The wording of § 12(3) persuades us that "net profits” are to be calculated using the accounting system used for Federal income tax purposes:
" 'Net profits’ means the net gain from the operation of a business, profession or enterprise, after provision for all costs and expenses incurred in the conduct thereof, determined on either a cash or accrual method, on the same basis as provided for in the internal revenue code for federal income tax purposes, * * * ” (emphasis added).* ****
While we agree with plaintiffs that the Legislature did not intend that the dollar amounts of state and Federal taxable income be equal, neither do we find that a taxpayer may entirely disregard its Federal' income tax calculations in determining Michigan taxable income. We hold for the taxpayers and reverse the Court of Appeals in Production Credit. We, too, hold for the Revenue Division in Detroit Edison, although for different reasons than those forming the basis for judgment in the Court of Appeals.
With respect to the net operating loss issue involved in Production Credit, defendant argues that:
"It is obvious from the wording in §2(3) that the Michigan tax base * * * was to be identical (unless otherwise specified in the Michigan Income Tax Act) to federal taxable income. To accomplish this statutory command, any operating loss sustained subsequent to January 1, 1968, must be applied against the net profits of the same tax period as it is applied for federal, income tax purposes.”
The plaintiffs in Production Credit respond that the purpose of the net operating loss deduction is to allow taxpayers who suffer losses to recoup taxes paid in respect to an equivalent amount of income and that the defendant’s construction of the Michigan statute, requiring the carry back of losses to years before the effective date of the Michigan income tax law, is not consistent with that purpose. Further, "taxable year” is defined in the Michigan Income Tax Act as "the calendar year, or the fiscal year ending during such calendar year, upon the basis of which taxable income is computed under this act” (emphasis supplied). MCL 206.24; MSA 7.557(124). Because 1966 and 1967, the years to which plaintiffs had carried back their 1969 losses on their Federal returns, were not "taxable years” under the Michigan act, and it is clear that carry-backs and carry-overs are to "taxable years” under the Internal Revenue Code, no net operating loss should be considered carried back to those years for Michigan tax purposes.
In view of the fact that the Legislature specifically mentioned "net operating loss” in the act, there can be no doubt that a net operating loss deduction was contemplated by the Legislature. The Legislature explicitly stated in § 12(3) that net profits were to be determined "without deduction of net operating loss carry-over or capital loss carry-over sustained prior to January 1, 1968”. What was not expressed was whether net operating losses were to be carried back to periods prior to January 1, 1968. The reasonable inference from what was expressed is, we believe, that net operating losses should not be considered carried back to periods prior to January 1, 1968.
We find the decision in In the Matter of Avien, Inc, 532 F2d 273 (CA 2, 1976), construing a comparable provision of the New York City income tax law, persuasive. The city had contended that since under the Federal law the taxpayer was required to carry back income to a year before the city income tax law was effective, it could not offset post-effective-date losses against post-effective-date income. The city law, paralleling the Michigan law, required that net income be "the same as” that reported in a taxpayer’s Federal return. The Court said:
"The City’s tax code provides that net income shall be ’the same as’ that which is reported on a taxpayer’s federal return, and that net operating loss deductions shall also be 'the same as’ deductions allowed under § 172 of the Internal Revenue Code ('Code’). However, this does not mean, and the District Court so held, that the reported figures on city and federal returns must be identical. Under the Code, it is not the identity of the loss deduction ñgures which is required, but rather the identity of permissible computation procedures used to calculate those ñgures.
"Section 172 of the Code outlines the basic deduction allowed for net operating loss, and includes carry-back and carry-over provisions to ensure accurate and fair income averaging over a period of years. Under the Code the taxpayer is permitted to carry losses back three years, and forward five years. In that section it is expressly provided that carry-overs and carry-backs shall be to 'taxable’ years within the permissible eight-year span. Utilization of losses to or from the earliest year possible is thus subject to the qualification that all of the years in question be 'taxable’ years. This qualification is also explicitly incorporated into the Code’s computation procedures: subsection (e) of § 172 specifies that 'the necessary computations involving any other taxable year [than the one to which the loss is applied] shall be made under the law applicable to such other taxable year. ’ (Emphasis supplied.)
"Applying this statutory scheme to Avien’s deductions on its City return, it is readily apparent that Avien could not utilize losses from 1963 because that year was not a 'taxable’ year under the City tax laws. Similarly, computation of the permissible loss deductions under § 172(e) for the year 1963 would be impossible since there were no City tax laws applicable in that year.
"The purpose of the City’s adoption of loss carry-overs and carry-backs is to give City taxpayers the beneñt of income averaging, not to exclude them from it.” 532 F2d 273, 275-276 (emphasis changed).
The acceptance of the instant defendant’s argument would produce a result inimical to the equitable goals of income averaging. We do not believe that the framers of the Michigan Income Tax Act, which specifically seeks to complement the Federal system of loss carry-overs and carry-backs, intended to undo the workings of that system by disallowing the plaintiffs’ claim for refunds for 1968, resulting from the carry-over or carry-back of net operating losses sustained by each for its 1968 or 1969 fiscal year. Furthermore, in applying § 12(3), it is significant that the net operating loss carry-back or carry-over involves an adjustment to taxable income rather than a computation of taxable income.
The Oregon Supreme Court has reached the same result in construing a similar statute, Christian v Dep’t of Revenue, 269 Or 469; 526 P2d 538 (1974). Michigan’s Board of Tax Appeals has also reached this result, Carrollton Concrete Mix Inc v Dep’t of Treasury, Docket No 930 (January 8, 1974), and Rollform, Inc v Dep’t of Treasury, Docket No 947 (January 8, 1974), reasoning that:
"The Internal Revenue Code section [172(b)(1)] directs carry-back losses and carry-forward losses to taxable years; therefore when applying the provisions of the above, to a loss incurred in a year taxable by Michigan, to be consistent one would carry-back that loss to each of the three Michigan taxable years preceding the Michigan taxable year of such loss. The first year taxable by Michigan was 1968, therefore years prior to 1968 are not considered 'taxable years’ by the Michigan Income Tax Act.” (Emphasis in original.)
Both parties argue the effect of 1970 PA 140 which amended the act. We cannot accept defendant’s contention that the 1970 amendment changed the law. In 1970, § 12(3) was repealed and § 32 was amended to read:
"(1) 'Taxable income’ in the case of a corporation other than a financial institution means federal taxable income subject to the following adjustments:
"(c) Add any net operating loss deductions which have been deducted in arriving at federal taxable income, and deduct any net operating loss deductions as defined in subsection (3).”
Subsection (3) explained how to carry back and forward net operating losses (the method was the same as § 172 of the Internal Revenue Code) and ended with this sentence: "A net operating loss shall not be allowed for taxable periods ending before January 1, 1968, and the loss shall not be applied to the income of any taxable periods ending before January 1, 1968." (Emphasis added.) The amendment indicates that the Legislature does not regard the construction urged by plaintiffs as inconsistent with the purpose of the act. We can think of no logical reason why the Legislature would want to distinguish 1968 and 1969 taxpayers from 1970 taxpayers with respect to the extent of net operating loss carry-backs. We believe a reasonable construction of the amendment evidences a legislative intent to clarify the law rather than to change it. The fact that the amendment addresses explicitly an issue upon which uncertainty had arisen because the issue had not been specifically addressed in the original act lends support to our belief that the intent was to clarify.
Detroit Edison Co v Janosz, 350 Mich 606; 87 NW2d 126 (1957), illustrates this principle of statutory construction. That case involved the propriety of allowing attorney fees in addition to taxable costs in a condemnation case. The preamended section read, in part:
"The expense of the proceeding shall be paid by the petitioner and as a part thereof the court shall allow such fees and compensation as seem just and reasonable.” MCL 486.252g; MSA 22.1672(7).
An amendment to the statute after the case was tried read, in part, "the court shall allow, in addition to taxable costs, additional attorney fees as may seem just and reasonable by the court for attendance at the hearing”. This Court rejected the contention that to give meaning to the amendment the original statute must be construed as not providing for attorney fees, stating that, while as a general rule an amendment is to be construed as changing the statute amended,
"The rule is not applied in reverse for the purpose of determining the meaning of the statute before amendment by presuming that it must have been something different than that which is the clear intent of the statute after amendment. * * * While in many and perhaps most instances it undoubtedly is the legislative intent, in enacting an amendment to change existing law, there are, as undoubtedly, other instances, particularly if uncertainty exists as to the meaning of a statute, when amendments are adopted for the purpose of making plain what the legislative intent had been all along from the time of the statute’s original enactment.” 350 Mich 606, 613-614.
Accordingly, we reject defendant’s argument that the 1970 amendment in question here, that net operating loss "shall not be applied to the income of any taxable periods ending before January 1, 1968” requires a different application of those losses for 1968 and 1969.
In the Detroit Edison case the parties agree that a deduction for depreciation is to be allowed as part of a "provision for all costs and expenses”, § 12(3). The parties differ considerably on the extent of the deduction. Defendant again argues that the Legislature’s intention, expressed in § 2(3), to subject to Michigan tax the same income as is subjected to Federal tax, requires a holding that the depreciable basis of assets and the depreciation deduction for Michigan income tax be the same as the Federal.
Plaintiff Detroit Edison argues that the Internal Revenue Code is to be used only as a frame of reference. Plaintiff was entitled to a deduction for depreciation as a cost or expense incurred in the operation of its business. Because § 168 of the Internal Revenue Code had expired by 1968, another method of computing the depreciation experienced in 1968 had to be found. Plaintiff chose straight line depreciation, 26 USC 167(b)(1), and chose useful lives of 28 and 30 years, Revenue Procedure 62-21, 1962-2 Internal Revenue Cumulative Bulletin, p 418. In arriving at fair market value on January 1, 1968 as the depreciable basis of its assets, Detroit Edison reasons that the Internal Revenue Code may be applied by analogy. The Internal Revenue Code provides that the basis of property acquired before the effective date of the act, March 1, 1913, is the greater of the fair market value on the effective date or the original cost of the property less depreciation to the effective date. Accordingly, Detroit Edison may use the fair market value on January 1, 1968 as the depreciable basis of its assets acquired before the effective date of the Michigan income tax act.
While we find no legislative intent to equalize the dollar amounts of state and Federal taxable income, we do not carry that principle as far as Detroit Edison would have us do. Although Detroit Edison’s argument as to depreciation has some appeal, it completely overlooks the Legislature’s expressed intention that Michigan income subject to tax be the same as Federal taxable income. Federal taxable income is to be a "yardstick” said the Court of Appeals of Maryland in a well-reasoned opinion to explain why the state could validly tax annual installment payments arising out of transactions completed before the state income tax reached capital gains,* Katzenberg v Comptroller of Treasury, 263 Md 189; 282 A2d 465 (1971). To construe the act so as to permit a different depreciation deduction for property purchased before 1968 would make the yardstick useless. As was hereinbefore stated, § 12(3) indicates that the method of calculation for Federal income tax purposes is to be applied. While the net operating loss question involves an adjustment to taxable income, clearly the depreciation allowance is part of the computation of net profits.
The fact that § 168 of the Internal Revenue Code is no longer available, and plaintiff’s election to apply that section was made before the institution of the Michigan tax, does not require a different result. This case, involving a disputed pre-effective date deduction, is analogous to the case involving taxing a gain upon disposition of an asset when a portion of the gain is attributable to appreciation of the asset during periods before an income tax becomes effective. Several cases have found no infirmity in including that gain in income. See Marco Associates, Inc v Comptroller of Treasury, 265 Md 669; 291 A2d 489 (1972); Tiedemann v Johnson, 316 A2d 359 (Me, 1974); Shangri-La v State, 113 NH 440; 309 A2d 285 (1973); Altsuler v Peters, 190 Neb 113; 206 NW2d 570 (1973); City National Bank of Clinton v Iowa State Tax Commission, 251 Iowa 603; 102 NW2d 381 (1960), and MacLaughlin v Alliance Ins Co, 286 US 244; 52 S Ct 538; 76 L Ed 1083 (1932). But see Fremont Mutual Ins Co v Dep’t of Treasury, 73 Mich App 526; 252 NW2d 837 (1977).
Again the parties argue the effect of 1970 PA 140. In 1970, § 32 was amended so that " 'taxable income’ in the case of a corporation other than a financial institution means federal taxable income” (subject to adjustments not pertinent here). Section 12(3) referring to "net profits” was repealed. In this case the parties are reversed in position as to the effect of the amendment, with the plaintiff taxpayer here arguing that the amendment changed the law, while the Revenue Division states "[i]t always has been our position that 'net profits’ was the equivalent of Line '28’, i.e., of corporate taxable income before net operating loss and special deductions”.
Using the principle of statutory construction utilized in Production Credit, we again find a legislative intent to clarify the law rather than to change it. See Detroit Edison Co v Janosz, 350 Mich 606; 87 NW2d 126 (1957). Thus, the 1970 amendment making corporate taxable income Federal taxable income subject to adjustments does not require a different rule for 1968 and 1969.
We also find Detroit Edison’s use of fair market value as of January 1, 1968 as the depreciable basis of its assets inappropriate. Again, Detroit Edison’s approach ignores the Legislature’s ex pressed intention in § 2(3). The analogy to property acquired before March 1, 1913 completely ignores § 1012 of the current Internal Revenue Code: "The basis of property shall be the cost of such property
The general rule is that assets are to be valued at original cost for income tax purposes. We find no indication that any exception to the rule was intended by the Michigan Legislature. Indeed, we find an indication in the act that the writing up of assets was not contemplated. Section 271 allows a "holding period” calculation whereby a taxpayer who disposes of an asset after the effective date of the act may elect to exclude from taxable income the proportional gain attributable to the period before January 1, 1968. While § 271 speaks directly only to gains or losses upon disposition of an asset, the enactment of § 271 is inconsistent with any revaluation of assets to January 1, 1968 fair market value for depreciation purposes. As the Revenue Division states it:
"But §271 does not allow any revaluation of that capital asset as of January 1, 1968.
"The emphasized fact is very important! The Michigan law could easily have provided that the 'basis’ of property should be recomputed as of January 1, 1968, for purposes of calculating capital gains and for purposes of depreciation. It did not do so!”
In Production Credit the decision of the Court of Appeals is reversed. In Detroit Edison the decision of the Court of Appeals is affirmed. No costs, a public question.
Kavanagh, C.J., and Williams, Levin, and Coleman, JJ., concurred with. Fitzgerald, J.
The Income Tax Act of 1967, 1967 PA 281; MCL 206.1 et seq.; MSA 7.557(101) et seq., instituted an income tax on corporations effective January 1, 1968. The corporate income tax was repealed by 1975 PA 233. The corporate income tax was replaced by the single business tax, 1975 PA 228; MCL 208.1 et seq.; MSA 7.558(1) et seq.
Although we use "Production Credit” in the singular, the term refers to six cases (Docket Nos. 58387-58392).
At the time this case arose, under § 172 of the Internal Revenue Code, 26 USC 172, a corporation having a net operating loss for any taxable year could average the loss by carrying its loss back three years and by carrying any unused loss forward for five years. The code required that the loss first be carried back to the earliest of the taxable years to which the loss could be carried. Any portion of the loss which remained (after setting it off against taxable income from the year in which it was carried) was applied to successive later taxable years until exhausted.
Section 168 of the 1954 Internal Revenue Code was amended in 1957 to provide that no certificate of necessity could be issued after December 31, 1959. Section' 168 was repealed by the Tax Reform Act of 1976. The section and its predecessors were enacted during World War II and the Korean conflict to encourage investment in facilities necessary for the national defense.
For example, "cash or accrual method”, § 12(3); "fiscal year”, § 24;
"credit”, § 28; "obligations of the United States government”, § 30; "sales or exchanges”, § 112; "asset”, § 271.
While it can be argued that "on the same basis as provided for in the internal revenue code” refers to "either a cash or accrual method”, a 1969 amendment to § 12(3) indicates that it is costs and expenses which are to be determined using the same accounting method as for Federal income tax purposes: " 'Net profits’ means the gross income of a business, profession or enterprise, less all costs and expenses incurred in the conduct thereof, determined in accordance with the same accounting method used for the same tax period for federal income tax purposes * * emphasis added. 1969 PA 332.
The case in which Federal and Michigan taxable income would be equal dollar amounts would, we suppose, be the exception rather than the rule. The adjustments in §§ 12 and 32, the § 271 exclusion and the allocation and apportionment rules of chapter 3 for taxpayers having income-producing activities in other states, all serve to differentiate the amounts of taxable income. See, also, Cook v Dep’t of Treasury, 396 Mich 176; 240 NW2d 247 (1976).
Contra, on a similar issue, see Getty Oil Co v Oklahoma Tax Commission, 563 P2d 627 (Okla, 1977).
See, generally, IA Sutherland, Statutory Construction (4th ed), §§ 22.30 and 22.31, pp 178-186.
Section 453 of the Internal Revenue Code.
The Maryland statute read:
"The net income of a corporation shall be the taxable income of such taxpayer as defined in the laws of the United States as amended from time to time and for the corresponding taxable period * * * .” Md Ann Code, art 81, § 280A(a).
The 1969 amendment to § 12(3), quoted in part in fn 6, supra, appears to be a step in the clarification process.
Whether original cost or fair market value should be the depreciation base of assets for reporting purposes is an issue generating considerable controversy within the accounting profession. See Fiflis & Kripke, Accounting for Business Lawyers (St Paul: West Pub Co, 1971), ch 5, § J, pp 227-233, "The Depreciation Base — Cost or Value”, and ch 7, § D, pp 297-327 on "Fair Value Accounting”. Those sections present several excerpts from and citations to articles by authorities on both sides of the debate.
In the absence of any legislative indication to the contrary, we maintain the traditional view, and leave adoption of fair value accounting to the accounting profession. In any event, the Internal Revenue Code (§ 1012) clearly indicates that, for income tax purposes, for property acquired after March 1, 1913, the depreciation base is to be cost.
"Sec. 271. (1) A taxpayer * * * whose income received after December 31, 1967 is increased or diminished by the disposition of an asset acquired before January 1, 1968 may elect to recompute taxable income by excluding therefrom the proportional gain or loss incurred prior to January 1, 1968. Taxpayers so electing shall be subject to a tax on taxable income thus recomputed at the rates imposed by this act. An election so made shall include all items of gains or losses realized during the taxable year.
"(2) The proportion of gain or loss occurring after December 31, 1967, to total gain or loss is equal to the proportion the number of months after December 31, 1967, to date of disposition bears to the number of months from date of acquisition to date of disposition.”
Section 271 was not necessary to validate the tax, see Shangri-La v State, supra. The enactment of that section appears to be a legislative attempt to ameliorate the effect of institution of the tax by allowing an election to recompute taxable income. The fact that the computation is to be done in terms of number of months indicates that the basis and depreciation deduction are not to be recomputed. | [
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Per Curiam.
Donald Lewis Damaska was convicted following a bench trial of two counts of breaking and entering a building with intent to commit larceny. MCLA 750.110; MSA 28.305. The Court of Appeals reversed the convictions in an unpublished per curiam opinion. The prosecutor applies for leave to appeal from that decision and, under GCR 1963, 853.2(4), we reverse the judgment of the Court of Appeals and reinstate the convictions.
The dispositive issue in this case is whether the arresting police officers had probable cause to seize an electronic calculator, which later proved to be stolen, from the back seat of the car defendant was driving.
During the late evening hours of March 11, 1975, two state police officers observed a car with its lights extinguished being driven across a parking lot from the vicinity of a Farm Bureau Insurance building. The lights were switched on as the car pulled onto the highway. This conduct, combined with the fact that the businesses were closed and the officers’ awareness that the Farm Bureau Insurance office had been the subject of two burglaries in recent weeks, prompted the officers to make an investigatory stop of the car. The defendant, "acting quite nervous”, was unable to produce a driver’s license and produced a vehicle registration that did not accurately reflect his name. The defendant stated that he had been drinking and had parked in the Farm Bureau parking lot to "sleep it off”; although the defendant did not have the appearance of having been drinking. One of the officers, using a flashlight, noticed what appeared to be a portion of a business machine protruding from beneath some clothing on the back seat and reached in and removed an electronic office calculator. The defendant explained that the calculator belonged to him; however, the calculator had a piece of plastic tape attached to it with the name "R. L. Luxmore” embossed on it. A radio check revealed that the calculator came from the Farm Bureau Insurance building and an investigation of that building, and a nearby building, revealed that both had been burglarized.
We believe the facts gave the officers probable cause to proceed as they did. The pertinent facts supporting this conclusion are: (1) the defendant emerged from a business parking lot late at night with his car lights extinguished; (2) the business was the subject of recent burglaries; (3) the defendant acted unusually nervous when stopped; (4) an office machine was observed partially hidden beneath some clothing on the back seat of the car; (5) the name taped on the calculator differed from the defendant’s. We held in People v Howell, 394 Mich 445; 231 NW2d 650 (1975), that the fact further investigation must be undertaken to establish that discovered property is stolen does not preclude a finding of probable cause for a search and seizure of the property when other factors combine to establish probable cause. The facts in the instant case form an equally compelling combination and require a similar finding.
Williams, Coleman, Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred. | [
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Fitzgerald, J.
Plaintiff Vincent Parker fell through a glass storm door on September 12, 1970. He was treated for serious lacerations on the back and neck at the emergency room of Highland Park General Hospital, a municipal hospital operated by the City of Highland Park. In 1972, Vincent Parker and his father, Casey Parker, filed a malprac tice suit against the hospital; Physicians Emergency Service, the corporation which operated the emergency room; and the doctor who had treated Vincent Parker.
In their complaint plaintiffs alleged that the treating physician had failed to take X-rays, that Vincent Parker had continued to feel pain in his back after treatment at Highland Park General Hospital, and that in 1972 treatment at another hospital revealed that a large piece of glass had remained lodged underneath the skin of Vincent Parker’s back since his accident.
The city moved for summary judgment, contending that plaintiffs had failed to state a claim upon which relief could be granted, because the city, as a governmental agency engaged in the exercise or discharge of a governmental function, was immune from tort liability under MCL 691.1407; MSA 3.996(107). The Court of Appeals denied leave to appeal. We granted leave to consider whether the day-to-day operation of a hospital is a "governmental function” as that phrase is used in the statute.
In the past this Court did hold that the operation of a hospital was a governmental function. Nicholson v Detroit, 129 Mich 246; 88 NW 695 (1902), Martinson v Alpena, 328 Mich 595; 44 NW2d 148 (1950).
We do not believe that because we once held the operation of a hospital to be a governmental function we must do so today. A comparison of the reasoning employed by this Court in Nicholson with that of Martinson shows that the meaning of the term "governmental function” has varied as the judiciary’s thinking on the nature of government has evolved.
Nor do we believe that the Legislature intended that we must today hold the operation of a hospital to be a governmental function because we did so in 1902 and 1950. As was stated in the Kavanagh-Fitzgerald dissenting opinion in Thomas v Dep’t of State Highways, 398 Mich 1, 17, fn 4; 247 NW2d 530 (1976), to read the second sentence of MCL 691.1407; MSA 3.996(107) as "preserving for all time state governmental immunity heretofore recognized by case law” would be to "assume that the Legislature failed to recognize that the evolution of case-law precedent is exclusively committed to the judicial branch of government”.
Determining whether or not a certain activity is or is not a "governmental function” is a matter of statutory interpretation. In the absence of a legislative definition of the term, statutory interpretation is a function committed to the judiciary. The term "governmental function” is particularly subject to judicial interpretation because the phrase is of judicial origin.
It is time we recognize that our case-law precedent, as it attempts to distinguish between a governmental and a proprietary function, is "inher ently unsound”. In abrogating common-law judge-made immunity (Pittman v Taylor, 398 Mich 41, 49; 247 NW2d 512 [1976]), we recognized the appropriateness of the analysis used to overrule a hospital’s charitable immunity to the governmental immunity area of the law. By substituting "definition of governmental function” and "governmental function” for "charitable” and "charities” in Parker v Port Huron Hospital, 361 Mich 1, 25; 105 NW2d 1 (1960), we said about charitable immunity then what we wish to say about governmental immunity today:
"The old rule of charitable immunity [definition of governmental function] was justified in its time, on its own facts. Today we have a new set of facts. It is true that the new facts are still described by the same word in our English language — "charities” [governmental function] — but that is because our language has not changed as the facts of our life have changed. We have new facts described by old nomenclature. To say that the old rule of law still applies is to reach a result on the basis of nomenclature, not of facts; it is to apply a rule, proper in its time, to completely new facts, and to justify doing so by reference to language merely without regard to the facts.” (Emphasis supplied.)
Again, we reject the rigid dichotomy of the past. Because an activity is not proprietary, it does not necessarily follow that the activity is governmental. We would limit the term "governmental function” to those activities sui generis governmental —of essence to governing. This principle was rec ognized in Lykins v Peoples Community Hospital, 355 F Supp 52, 53 (ED Mich, 1973):
"This court does not believe the statutory scheme contemplates immunity for the day-to-day operations of a hospital. The statute speaks of immunity for 'governmental functions,’ and this court is of the opinion that while it may be an appropriate goal or objective of government to establish a hospital authority, it does not follow that the daily operations of such a hospital authority constitute a governmental function. Governmental functions more properly refer to the tasks of governing. There is, for example, a governmental character to activities such as the collection of taxes or the operation of a court system. But the services of healing offered by a public hospital are not governmental functions.”
The operation of a hospital is not an activity of a peculiar nature such that the activity can only be done by government. Rather, government participates alongside private enterprise, charitable and religious organizations in operating hospitals.
In adopting the "of essence to government” test for defining the term "governmental function”, we reject the "common good of all” test applied in Martinson v Alpena, supra. The operation of a hospital is a noble undertaking on the part of a unit of government. But, the fact that the government-operated hospital contributes to the "common good” does not distinguish the government-operated hospital from the non-government-oper ated hospital. We feel safe in assuming that hospitals operated by non-government entities, who do not enjoy immunity from tort liability, also contribute to the "common good”.
The modern hospital, whether operated by a city, a church, or a group of private investors, is essentially a business.* As such, there is no rational ground upon which immunity for the government-operated hospital can rest.
Reversed and remanded. No costs, a public question.
Kavanagh, C.J., and Levin, J., concurred with Fitzgerald, J.
"Except as in this act otherwise provided, all governmental agencies shall be immune from tort liability in all cases wherein the government agency is engaged in the exercise or discharge of a governmental function. Except as otherwise provided herein, this act shall not be construed as modifying or restricting the immunity of the state from tort liability as it existed heretofore, which immunity is affirmed.”
Because the case was disposed of below on the governmental immunity issue, the facts on the relationship among the defendants in this case have not been developed. Therefore, we offer no opinion on whether or not the hospital may escape liability because the emergency room was operated by a corporation of which the treating physician was a member, as Highland Park Hospital suggests. Nor do we decide the effect of Dr. Sokolowski’s alleged settlement with plaintiffs.
Nicholson involved a hospital for contagious disease. Plaintiffs decedent was a carpenter who contracted smallpox when employed by the City of Detroit in the construction of a new hospital on the site of an existing hospital. Plaintiff alleged that the old building and the grounds were infected with smallpox germs and the city was negligent in exposing the carpenter to the germs. Nonliability was based on the city’s performing a "governmental function”. To the Nicholson Court, performing a governmental function meant that the city was acting as an agent of the state rather than for its own private purposes. See Cooperrider, The Court, the Legislature, and Governmental Tort Liability in Michigan, 72 Mich L Rev 187, 222-224 (1973).
Martinson involved a general hospital operated by the City of Alpena. Nurse Madeleine Martinson fell into the elevator shaft. She sued the city, alleging negligence because of a faulty safety catch which allowed the guard door to open when the elevator was at another floor. The Court relied on Nicholson, finding a general hospital "within the same category” as a contagious hospital. The Court also applied the "common good of all” test for distinguishing between a governmental and a proprietary function.
" 'The underlying test is whether the act is for the common good of all without the element of special corporate benefit or pecuniary profit. If it is, there is no liability; if it is not, there may be liability. That it may be undertaken voluntarily and not under compulsion of statute is not of consequence.’ Gunther v Cheboygan County Road Commissioners, 225 Mich 619 [196 NW 386 (1923)]; Johnson v Ontonagon County Road Commissioners, 253 Mich 465 [235 NW 221 (1931)]; Daszkiewicz v Detroit Board of Education, 301 Mich 212 [3 NW2d 71 (1942)].” Martinson v Alpena, 328 Mich 595, 598; 44 NW2d 148 (1950).
"It is revolting to have no better reason for a rule of law than that so it was laid down in the time of Henry IV. It is still more revolting if the grounds upon which it was laid down have vanished long since, and the rule simply persists from blind imitation of the past.” Oliver Wendell Holmes, Jr., Collected Legal Papers (New York: Harcourt, Brace & Howe, 1920), p 187.
For a complete exposition on the evolution of the governmental/ proprietary distinction, see Cooperrider, The Court, the Legislature, and Governmental Tort Liability in Michigan, 72 Mich L Rev 187, 219-237 (1973).
"Except as otherwise provided herein, this act shall not be construed as modifying or restricting the immunity of the state from tort liability as it existed heretofore, which immunity is affirmed.”
Compare the interesting California case Li v Yellow Cab Co of California, 13 Cal 3d 804; 532 P2d 1226; 119 Cal Rptr 858 (1975). The California Court adopted a comparative negligence rule in the face of a contributory negligence statute. The Court believed the Legislature’s intent in enacting the 1872 statute was to "state the basic rule of negligence together with the defense of contributory negligence modified by the emerging doctrine of last clear chance”. Even so, the Court believed the Legislature did not intend to "restrict the courts from further development of these concepts according to evolving standards of duty, causation, and liability”.
The effect of the California Court’s decision, of course, was to totally nullify the statute. We do not go so far. In defining "governmental function” more narrowly than in the past, we do limit the operation of the statute, yet preserve the doctrine of governmental immunity.
The United States Supreme Court has noted that in the governmental/proprietary "quagmire” "the decisions in each of the states are disharmonious and disclose the inevitable chaos when courts try to apply a rule of law that is inherently unsound”. Indian Towing Co v United States, 350 US 61, 65; 76 S Ct 122; 100 L Ed 48 (1955).
Professor Davis has criticized the distinction as "probably one of the most unsatisfactory known to the law”. 3 Davis, Administrative Law Treatise, § 25.07, p 460.
The analysis of ownership of hospitals located in Michigan which have registered with thé American Hospital Association is as follows:
State and local government 70
Federal government 9
Non-government, not for profit 167
Investor owned, for profit 6
Osteopathic (non-government, not for profit) 2
American Hospital Association, Guide to the Health Care Field, 1977 Edition, pp 108-116.
Nor do we accept the contention that what distinguishes the government-operated hospital from others, hence entitling it to immunity, is that the government-operated hospital must accept all comers, regardless of ability to pay. In the usual case, it is not the hospital itself that extends "charity”, but another arm of government, often a county welfare agency or the Medicare system. In Martinson, supra, p 597, although the city hospital apparently accepted indigent patients, the county welfare board paid the bill of those patients. Although government often pays for the health care services extended to indigents, many times the care is provided in non-government operated hospitals.
"Hospitals today are growing into mighty edifices in brick, stone, glass and marble. Many of them maintain large staffs, they use the best equipment that science can devise, they utilize the most modern methods in devoting themselves to the noblest purpose of man, that of helping one’s stricken brother. But they do all this on a business basis, submitting invoices for services rendered — and properly so.
"And if a hospital functions as a business institution, by charging and receiving money for what it offers, it must be a business establishment also in meeting obligations it incurs in running that establishment. One of those inescapable obligations is that it must exercise a proper degree of care for its patients, and, to the extent that it fails in that care, it should be liable in damages as any other commercial firm would be liable.”
Flagiello v Pennsylvania Hospital, 417 Pa 486, 493-494; 208 A2d 193,196-197 (1965) (overruling charitable immunity).
As noted in Thomas, supra, to recognize governmental immunity for the day-to-day operation of a hospital would equate "governmental function” with "governmental participation”. If the Legislature had intended that result, surely the first sentence of MCL 691.1407; MSA 3.996(107) would read, "Except as in this act otherwise provided, all governmental agencies shall be immune from tort liability.” We do not today decide whether or not such a statute would pass constitutional muster. | [
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Blair Moody, Jr., J.
Richard Lee Helzer was
charged in Alpena County with committing two acts of gross indecency with another male, contrary to MCL 750.338; MSA 28.570. In the same two-count information, he was further charged with being a sexually delinquent person at the time of the offenses. See, also, MCL 750.338; MSA 28.570. Conviction of gross indecency carries a maximum penalty of five years imprisonment. However, the additional penalty provided upon a finding of sexual delinquency allows an alternate confinement of one day to life imprisonment.
Defendant Helzer was convicted by jury on the principal two charges of gross indecency. Subsequently, he was separately convicted by the same jury of being a sexually delinquent person at the time the acts occurred. As a result of the convictions, he was sentenced concurrently to from ten years to life on each count.
Defendant appealed to the Court of Appeals, alleging that, as regards the bifurcated gross indecency and sexually delinquent person charges, he was charged with but a single statutory offense carrying a possible life sentence and therefore was entitled to 20 peremptory jury challenges. At trial, he had been allowed only the five challenges required by the possible penalty available for a gross indecency prosecution. The Court of Appeals reversed on the basis of this claim, ordering a new trial as to all charges. We granted leave to appeal. 399 Mich 824 (1977).
The question we will address on this appeal is whether in a gross indecency prosecution, where defendant is also charged with sexual delinquency, reversible error occurs when the court refuses defendant’s request for 20 peremptory jury challenges, even though the separate charge of sexual delinquency carries a possible penalty of life imprisonment. We reverse the Court of Appeals order for a totally new trial. We find defendant’s trial on the principal charges of gross indecency without error. However, we do find error in the trial court’s denial of defendant’s request for 20 peremptory jury challenges incident to his prosecu tion as a sexually delinquent person and so remand for hearing before a jury separately empaneled to decide this question.
I
Defendant was convicted of two offenses involving gross indecency. The statute relating to gross indecency defines the offense in the following way:
"Any male person who, in public or in private, commits or is a party to the commission of or procures or attempts to procure the commission by any male person of any act of gross indecency with another male person shall be guilty of a felony, punishable by imprisonment in the state prison for not more than 5 years, or by a fine of not more than $2,500.00.” MCL 750.338; MSA 28.570.
Additionally, the statute provides that defendant may be declared a sexually delinquent person at the time the offense occurred:
"[I]f such person was at the time of the said offense a sexually delinquent person, [then he] may be [punished] by imprisonment in the state prison for an indeterminate term, the minimum of which shall be 1 day and the maximum of which shall be life.” MCL 750.338; MSA 28.570.
Similar sexual delinquency provisions exist in several other criminal statutes. See MCL 750.158; MSA 28.355 (sodomy); MCL 750.335a; MSA 28.567(1) (indecent exposure); MCL 750.338a; MSA 28.570(1) (gross indecency, females); MCL 750.338b; MSA 28.570(2) (gross indecency, male-female).
In order to convict defendant as a sexual delinquent, evidence of delinquency, as defined by MCL 750.10a; MSA 28.200(1), must be established beyond a reasonable doubt:
"The term 'sexually delinquent person’ when used in this act shall mean any person whose sexual behavior is characterized by repetitive or compulsive acts which indicate a disregard of consequences or the recognized rights of others, or by the use of force upon another person in attempting sex relations of either a heterosexual or homosexual nature, or by the commission of sexual aggressions against children under the age of 16.”
Conviction of sexual delinquency can be obtained only in conjunction with conviction on the principal charge. Yet, sexual delinquency is a matter of sentencing, unrelated to proof of the principal charge. No additional element of "sexual delinquency” need be proven in order to convict on the principal charge.
Accordingly, what activates the sexual delinquency provision is proof of guilt of a principal criminal offense. However, coupled with this fact, the sexual delinquency hearing itself must prove that defendant has committed "repetitive or compulsive acts which indicate a disregard of conse quences or the recognized rights of others”, or acts of force used "upon another person in attempting sex relations of either a heterosexual or homosexual nature”, or acts of sexual aggression committed "against children under the age of 16.” MCL 750.10a; MSA 28.200(1). (Emphasis added.)
It is also clear that proof of the sexual delinquency charge may involve more than simple ministerial considerations. Very broad substantive factors come into play when the court or jury decide this question. MCL 767.61a; MSA 28.1001(1) provides for a separate hearing and record, involving psychiatric and expert testimony on the question. Even where defendant pleads guilty, the court is ordered to separately investigate the charge of sexual delinquency. Language in this statute specifically characterizes sexual delinquency as "an alternate sentence to imprisonment”. See MCL 767.61a; MSA 28.1001(1). (Emphasis added.) In short, this particular provision reflects legislative intent to construe sexual delinquency as a separate, alternate form of sentencing.
Consequently, we are led to an interpretation different than that adopted by the Court of Appeals. That Court’s opinion found sexual delinquency to be entirely self-contained in MCL 750.338; MSA 28.570, and thus simply a penalty enhancement provision related to the principal gross indecency charge. To the contrary, we find sexual delinquency to be an alternate sentencing provision tied to a larger statutory scheme. Further, we find the nature of the sexual delinquency hearing itself inconsistent with a simple penalty enhancement rationale. We also find the role of the fact finder highly discretionary in deciding the delinquency question. Finally, Vre note the risk of extreme punishment involved with a finding of sexual delinquency. All of these considerations require us to reject the approach taken by the Court of Appeals.
II
A close examination of the legislative history of sexual delinquency demonstrates a sound basis for an alternate sentencing interpretation. At the time the concept became part of Michigan law, related statutory provisions were enacted which clearly indicate sexual delinquency was conceived as possible mental illness precluding a fixed sentence. The concept of sexual delinquency was included in the then-existing mental health code and Department of Corrections Act, which specifically provided for treatment and early release upon satisfactory review by the parole board. The intended result entailed a more flexible and less determinate sentencing framework than set terms of imprisonment. This flexible form of incarceration was meant to entirely replace the more structured and limited sentence provided upon conviction of the principal charge.
Further, this alternate context for handling sexually delinquent persons was explicitly tied to other criminal provisions and, by analogy, even to legislation dealing with civil commitment. In sum, sexual delinquency was part of a much broader scheme of rehabilitation involving a sentence adjusted to defendant’s treatment and recovery from possible mental illness. Thus the sentence for being sexually delinquent was not primarily penal. Punishment within a specific limited period for the principal offense was reserved for those whose psychiatric histories, considered after conviction on the principal charge, reflected no serious tendency toward pathologically repetitive, compulsive, forceful or aggressive acts. So conceived, the sexually delinquent person concept was clearly intended to entail a more flexible, alternate form of sentencing.
Since the legislation was originally enacted, numerous changes have occurred not only in statutes which specifically included the sexual delinquency concept, but also in legislation related to other forms of sexual conduct considered criminal. The wording in the then-existing mental health code, including sexual delinquency in the definition of mental illness, was deleted. Further, the Mental Health Code was completely revised four years ago. Authority now exists for a finding of "guilty but mentally ill” in criminal prosecutions, which might parallel the sexual delinquency concept as included in the old mental health code. Provision for treatment and early release of sexual delinquents, which was included in the Department of Corrections Act, was amended out of that statute. Similarly, references to sexual delinquency originally found in other legislation have been deleted as new or revised law has appeared. In short, sexual delinquency is now limited to five specific criminal provisions, three of which arise from the same criminal conduct. Thus constituted, sexual delinquency is a seldom-used category of alternate sentencing, now less explicitly rehabilitative. Provision for treatment is now confined to the normal facilities available to all prison inmates.
Ill
We conclude that in order to fairly proceed against a defendant under this modified statutory scheme, the alternate nature of the sentence requires a hearing and record before a separate jury in cases where defendant does not waive jury trial. The substantial function and discretion of the jury in hearing the sexual delinquency charge, the high potential for automatic conviction were the original jury to hear the delinquency charge and the penalty of life imprisonment possible upon finding sexual delinquency all inform our order for separate jury consideration. Within the special context of the sexual delinquency hearing, we find that these circumstances distinguish this proceeding from any analogy to habitual offender proceedings. See People v Stratton, 13 Mich App 350; 164 NW2d 555 (1968).
The trial court cannot predict at the outset whether a defendant will actually be prejudiced by having the same jury decide both the principal charge and the sexual delinquency charge. However, the potential for prejudice is inescapable, given the broad function and wide discretion necessarily accorded the jury in the sexual delinquency hearing. Much more is involved than simply determining whether this defendant is the person convicted of specific prior offenses. Indeed, acts not necessarily resulting in criminal convictions may be considered under the statute. See MCL 750.10a; MSA 28.200(1). Furthermore, the definition of a sexually delinquent person allows, and in fact must depend upon, consideration of the prior principal sexual offense. Consequently, we find the possibility too real that a jury which only shortly before had found defendant guilty beyond a reasonable doubt on the principal sexual offense might without responsible deliberation conclude he was also a sexually delinquent person. In short, the likelihood of an automatic conviction in this subsequent proceeding requires us to order a separate jury.
Additionally, in view of the potential life sentence under the sexual delinquency charge, if the same jury hears both charges a defendant is entitled to 20 peremptory challenges in the empaneling the original jury. However, if the need for a second jury is left to the discretion of the trial court and the court finds a different jury necessary to avoid prejudice in trying the sexual delinquency charge, then the time and expense in proceeding with 20 peremptory challenges at the beginning of the trial is wasted. We find this situation incongruous.
As a result, we conclude that the decision to empanel a separate jury should not be left to the discretion of the trial judge. Unless waived by the defendant, we shall require that a second jury be provided in every case to decide the sexual delinquency charge. The second jury should be empaneled before the same trial judge immediately after conviction on the principal charge.
Further, because defendant is separately tried on the charge of sexual delinquency, which carries a possible sentence of life in prison, he is entitled to 20 peremptory challenges in the empaneling of this jury. On the other hand, at the time the initial jury is empaneled on the principal charge, defendant should be allowed only the number of peremptory challenges appropriate to the possible sentence on that charge.
Moreover, though defendant is separately tried by two different juries, the charge against him for sexual delinquency must be brought before trial on the principal charge begins. The statute mandates that result by including the word "shall” in the relevant language of MCL 767.61a; MSA 28.1001(1):
"In any prosecution for an offense committed by a sexually delinquent person for which may be imposed an alternate sentence to imprisonment for an indeterminate term, the minimum of which is 1 day and the maximum of which is life, the indictment shall charge the offense and may also charge that the defendant was, at the time said offense was committed, a sexually delinquent person.” (Emphasis added.)
Thus, if brought at all, a charge of sexual delinquency must be included in the original indictment. The word "may” in the statute refers to the option available to the prosecutor, indicating the sexual delinquency charge may or may not be included. This language does not allow a subsequent information to be filed after the principal charge is tried.
We would contrast this provision with the habitual offender statute. In the case of sexual delinquency, ascertaining whether a prosecutor knew or should have known of circumstances which would lead him to add sexual delinquency to the information would be more difficult to establish with certainty. Consequently, determining the prosecutor’s good faith discovery of prior convictions in habitual offender cases is not reasoning which can be transposed to the sexual delinquency context.
After the trial begins, the prosecutor will have waived the opportunity to bring a sexual delinquency charge. By imposing this time limit, we avoid late charges which would prejudice defend ant. The substantive character of the sexual delinquency hearing and the extreme penalty possible weigh in our decision. Ideally, the original indictment should include both principal charges and the charge of sexual delinquency. However, we find no impropriety in allowing amendments of the indictment or information prior to trial. Thus, if the prosecutor decides during the period of trial preparation that a charge of sexual delinquency is appropriate, he should be permitted to modify the information. Beyond this point, he waives any right to bring such prosecution.
Furthermore, we hold that no reference to the sexual delinquency charge should be made to the jury trying the principal charge. Given the provision for separate juries, absolutely no need remains to acquaint the jury hearing the principal charge with the possible subsequent conviction of defendant as a sexually delinquent person. Discovery during trial of the principal charge that the jury hearing that case has learned of the sexual delinquency charge will henceforth be grounds for mistrial on the principal charge or reversible error on appeal. The two charges must be tried separately. Basic fairness to defendant requires this holding.
IV
Considering defendant’s position in the present case, we find that the trial held on the principal charge was procedurally acceptable. He was charged in the original two-count information with both the principal crime of gross indecency and sexual delinquency. Defendant was provided with only five peremptory challenges during voir dire on the principal charge. The charge of sexual delinquency was not placed before the jury during trial or deliberations on the principal charge. Only after the verdict of guilty on the principal charge did the court acquaint the jury with the charge of sexual delinquency. We thus find no error in the proceeding to this point and so affirm defendant’s conviction of the principal offenses of gross indecency.
What we find objectionable is the trial court’s decision to allow the same jury hearing the principal charge to decide the subsequent matter of sexual delinquency and, further, to deny defendant the right to 20 peremptory jury challenges on that charge. We thus affirm the Court of Appeals on this basic point; but reverse their order for an entirely new trial. We remand only for hearing before a separately empaneled jury should the prosecutor decide to pursue the sexual delinquency charge. Defendant should be accorded the full 20 peremptory challenges appropriate to the possible life sentence. Should the prosecutor choose not to proceed upon the sexual delinquency charge, or should the defendant be found not guilty, defendant will be resentenced by the trial court only on the principal charge.
Given our ruling of procedural error in the sexual delinquency proceeding, we will not now consider the larger constitutional claim first alleged by defendant in his cross-appeal to this Court. Should defendant be found sexually delinquent on proper hearing below, then appeal on constitutional grounds may be brought and fairly considered in the correct order.
Affirmed in part; reversed in part and remanded to the trial court for further proceedings.
Williams, Levin, Coleman, Ryan, and Fitzgerald, JJ., concurred with Blair Moody, Jr., J.
Gross indecency has been designated under three separate provisions of the criminal code. See MCL 750.338; MSA 28.570 (gross indecency, males); MCL 750.338a; MSA 28.570(1) (gross indecency, females); MCL 750.338b; MSA 28.570(2) (gross indecency, male-female). Each proscribes identical behavior, distinguished only by the sex of the parties involved.
Sexual delinquency was simply engrafted upon the existing principal categories of gross indecency. Most legislative provisions relative to sexual delinquency became effective September 18, 1952. A broad interrelated scheme was evidently intended in dealing with the problem of sexual delinquency.
The statute provides penalties of fine or imprisonment:
"punishable by imprisonment in the state prison for not more than 5 years, or by a fine of not more than $2,500.00.” MCL 750.338; MSA 28.570.
Michigan decisions have viewed this sentence as indeterminate. See People v Winford, ante, 404 Mich 400; 273 NW2d 54 (1978).
Trial proceeded on the principal charge without reference to the additional charge of sexual delinquency.
Defendant presented virtually no defense to the charge of sexual delinquency. The prosecutor introduced (1) a certified order of probation of March 5,1965, indicating prior conviction in Alpena County of accosting and soliciting a minor child, and (2) a Macomb County Court disposition sheet showing defendant’s conviction of indecent liberties with a minor child on March 18, 1968. In response, defendant merely argued that the convictions were old enough to cast doubt on any finding of sexual delinquency under the statute. After the verdict, the judge made a separate finding, as a matter of law, that defendant was a sexually delinquent person.
The Court of Appeals decision is reported at 70 Mich App 683; 247 NW2d 328 (1976).
This language fixes the relevant time to decide whether defendant was sexually delinquent at the point when the principal offense was committed. Further, sexual delinquency was intended to depend upon conviction and subsequent consideration of the principal criminal charge and surrounding psychiatric history. Only where the principal charge is prosecuted to conclusion and defendant found guilty can sexual delinquency be tried.
MCL 750.10a; MSA 28.200(1) does not directly specify "elements” of proof. However, the language qualifying the designated acts conforms to a determinable structure of proof. As noted, proof of these acts must be established beyond a reasonable doubt.
The Court of Appeals has correctly determined that charges of sexual delinquency may be brought only where the principal criminal statute explicitly so specifies. See People v Seaman, 75 Mich App 546; 255 NW2d 680 (1977), where supplementation of third-degree criminal sexual conduct prosecution with sexual delinquency charge was rejected because explicit provision for charging sexual delinquency is nowhere contained within the criminal sexual conduct statute.
In this particular case, defendant’s prior conviction constituted the basis for the jury’s sexual delinquency verdict. This case thus parallels the normal habitual offender prosecution where the offense is totally defined and limited by the existence of prior convictions. However, sexual delinquency is not explicitly dependent upon any prior conviction except the principal charge. Hence, though the sexual delinquency prosecution must be defined in terms of a contemporaneous conviction on the principal charge, the court or jury is not limited to record convictions in their deliberations. The only limitation is that they must weigh the acts specified in MCL 750.10a; MSA 28.200(1). Defendant is not punished for prior offenses. He is prosecuted in order to determine whether special circumstances surrounding the principal charge make an alternate sentence appropriate.
This provision constitutes the major procedural pronouncement regarding the sexual delinquency hearing and reads as follows:
"In any prosecution for an offense committed by a sexually delinquent person for which may be imposed an alternate sentence to imprisonment for an indeterminate term, the minimum of which is 1 day and the maximum of which is life, the indictment shall charge the offense and may also charge that the defendant was, at the time said offense was committed, a sexually delinquent person. In every such prosecution the people may produce expert testimony and the court shall provide expert testimony for any indigent accused at his request. In the event the accused shall plead guilty to both charges in such indictment, the court * * * before sentencing the accused, shall conduct an examination of witnesses relative to the sexual delinquency of such person and may call on psychiatric and expert testimony. All testimony taken at such examination shall be taken in open court and a typewritten transcript or copy thereof, certified by the court reporter taking the same, shall be placed in the file of the case in the office of the county clerk. Upon a verdict of guilty to the first charge or to both charges or upon a plea of guilty to the first charge or to both charges the court may impose any punishment provided by law for such offense.” MCL 767.61a; MSA 28.1001(1).
Though not explicitly stated, we find a separate hearing and record directed by clear implication.
By particularly isolating both psychiatric and expert testimony for consideration, the statute must be construed to authorize any competent medical, sociological or psychological testimony which might aid in the determination of defendant’s mental and physical condition at the time the principal offense occurred.
Defendant will be entitled to a jury trial on the delinquency charge, even where he enters a guilty plea to the principal charge. If defendant enters a plea to both charges, still the court’s examination should be conducted under a procedure equivalent to that used where a jury decides the sexual delinquency question. The same kinds of evidence will be admissible in deciding the appropriate sentence.
See the Court of Appeals opinion in People v Helzer, supra. See, also, People v Saunders, 42 Mich App 246, 248; 201 NW2d 671 (1972), lv den 389 Mich 753 (1972); People v Winford, 59 Mich App 404, 407; 229 NW2d 474 (1975), lv granted 395 Mich 824 (1976).
Sexual delinquency was included within the definition of mental illness under the Hospital Act for Mentally Diseased Persons by 1952 PA 148. At the same session, the Michigan Corrections Act was amended to encompass sexually delinquent persons. See 1952 PA 72, § 74a. Provision appeared for psychiatric treatment and authorization for early release by the parole board. See 1952 PA 72, § 74b.
MCL 330.54; MSA 14.844.
MCL 791.33a et seq.; MSA 28.2173(1) et seq.
See the indecent liberties statute, MCL 750.336; MSA 28.568, the rape statute, MCL 750.520; MSA 28.788, the assault with intent to commit rape statute, MCL 750.85; MSA 28.280, the incest statute, MCL 750.333; MSA 28.565, the indecent exposure statute, MCL 750.335a; MSA 28.567(1), and the sodomy statute, MCL 750.158; MSA 28.355.
The provision for civil commitment was the Criminal Sexual Psychopath Act legislated in 1950, amended in 1952 and 1966, and later repealed in 1968. See 1950 (Ex Sess) PA 25; 1952 PA 58; 1966 PA 267; 1968 PA 143; MCL 780.501-780.507; MSA 28.967(l)-28.967(7). See also, People v Griffes, 13 Mich App 299; 164 NW2d 426 (1968).
All references to sexual delinquency were deleted in enacting the new Michigan Mental Health Code in 1974.
See MCL 330.1001 et seq.; MSA 14.800(1) et seq.
See MCL 768.36; MSA 28.1059. We have granted leave to appeal in a matter which would consider this particular provision. See People v McLeod, Docket No. 60368.
See 1953 PA 232, repealing MCL 791.33a et seq.; MSA 28.2173(1) et seq. Provisions as modified can be found in MCL 791.201 et seq.; MSA 28.2271 et seq.
Several statutes included identical language. See the indecent liberties statute, MCL 750.336; MSA 28.568, repealed by 1974 PA 266; the rape statute, MCL 750.520; MSA 28.788, repealed by 1974 PA 266; the assault with intent to commit rape statute, MCL 750.85; MSA 28.280, repealed by 1974 PA 266; the incest statute, MCL 750.333; MSA 28.565, repealed by 1974 PA 266.
See MCL 750.158; MSA 28.355 (sodomy); MCL 750.338; MSA 28.570 (gross indecency, males); MCL 750.338a; MSA 28.570(1) (gross indecency, females); MCL 750.338b; MSA 28.570(2) (gross indecency, male-female).
We recognize defendant’s question concerning the treatment accorded persons who might be sentenced to life imprisonment. However, this question is not directly before us on this appeal. Nonetheless, because one of the intended purposes for an alternate sentence is treatment and possible rehabilitation, we do consider this a significant problem.
See footnote 14, supra, and accompanying text.
We reject the reasoning and conclusion applied by the Court of Appeals in People v Saunders, supra. The Court found there that the same jury could consider both a principal charge and the sexual delinquency charge. Id. at 248.
See footnote 14, supra, and accompanying text.
See Judge, now Justice, Levin’s discussion of this problem in habitual offender prosecutions. People v Stratton, 13 Mich App 350, 356; 164 NW2d 555 (1968).
We find the same principal and reasoning applies to the sexual delinquency proceeding as obtains for habitual offender prosecutions. See Id. at 357-358. | [
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Per Curiam.
The plaintiff in this case allegedly suffered a work-related injury to his back while in the employ of the defendant in July of 1972. In March of 1973 he filed a petition for benefits. The hearing referee found that the plaintiff had suffered a personal injury on July 15, 1972 and awarded benefits. The defendant appealed to the WCAB. That tribunal, in an opinion and order dated August 13, 1975, reversed the hearing referee and denied compensation benefits. In doing so, the WCAB concluded that although the plaintiff had indeed sustained a work-related injury on July 15, 1972, the plaintiff had failed to provide the defendant either with timely notice of injury or timely notice of claim as required by MCLA 418.381; MSA 17.237(381).
The plaintiff filed an application for leave to appeal in the Court of Appeals. On November 6, 1975, the Court of Appeals denied leave to appeal.
The plaintiff then filed an application for leave to appeal in this Court. By order dated June 30, 1976, we ordered the application to be held in abeyance pending decision in the case of Krol v Hamtramck, 398 Mich 341; 248 NW2d 195 (1976). After Krol was decided, we remanded the matter to the Court of Appeals for consideration in light of our decision in that case. 399 Mich 886 (1977).
On remand, the Court of Appeals, after considering the matter in light of Krol, once again denied leave to appeal. We thereafter granted leave to appeal. 402 Mich 803 (1977).
The issue presented is whether the WCAB correctly concluded that the plaintiff in the instant case had failed to provide the defendant with timely notice of injury and timely notice of claim as required by MCLA 418.381; MSA 17.237(381). That statute provides in relevant part:
"(1) No proceedings for compensation for an injury under this act shall be maintained, unless a notice of the injury has been given to the employer within 3 months after the happening thereof and unless the claim for compensation with respect to the injury, which claim may be either oral or in writing, has been made within 6 months after the occurrence of the same; or in case of the death of the employee, within 12 months after death; * * *. In a case in which the employer has been given notice of the happening of the injury or has notice or knowledge of the happening of the accident within 3 months after the happening of the same, and fails, neglects or refuses to report the injury to the bureau as required by the provisions of this act, the statute of limitations shall not run against the claim of the injured employee or his dependents, oi in favor of the employer or his insurer, until a report of the injury has been filed with the bureau.”
The facts as found by the WCAB are as follows:
"His [plaintiffs] testimony also establishes that he did not go to the plant first-aid facility with any report of injury, and that he thereafter worked all scheduled days and hours until the start of a strike, August 3, 1972. During that strike he began to get leg and back cramps and saw his family doctor, a Dr. Bouten. He did not return to work when the strike ended, and applied for group insurance benefits disclaiming any work cause on the form filed.
"Plaintiff had disc surgery in November, 1972. Surgeon Charles Rasmus, D.O., was deposed and testified it was a 'reasonable medical conclusion’ that the described incident caused the disc rupture found. He also found plaintiff still disabled (as of May 23, 1973) from lift-truck driving. We here find as fact the work incident caused the disc condition and the current disability.
"However, while plaintiff may have told his doctor of the causal relationship (a matter not made completely clear on this record), plaintiff specifically denies ever reporting a work disability to any defendant agent. This was in addition to denying work relationship on his group insurance form and never making any first-aid visit.
"First notice and claim were given simultaneously, subsequent to plaintiff filing a petition for hearing with the bureau, March 6, 1973, nearing eight months later.
"Plaintiff having abandoned any claim for occupational disablement (Chapter IV) at the hearing, and having proven a specific injury (Chapter III) his obligation was to give notice of the injury 'within 3 months after the happening thereof and make claim 'within 6 months after the occurrence of the same’. Neither was done.”
We have examined the record in this case and find support in it for the findings of fact of the appeal board. The question of notice is one of fact and the WCAB’s findings are binding on the Court if there is evidentiary support. West v Northern Tree Co, 365 Mich 402; 112 NW2d 423 (1961). There is no indication in this record that the plaintiff ever reported the injury sustained to the defendant or any of defendant’s agents. The record does reveal that the plaintiff informed his foreman of the condition of the machinery which had caused the accident. However, that is clearly not sufficient. The statute requires notice of the injury, not notice of the accident. The record supports the conclusion that the first notice of injury and notice of claim which the defendant received occurred when the plaintiff filed his petition for hearing nearly nine months after he sustained the injury.
The plaintiff argues on appeal, however, that the running of the limitations period should be tolled because he did not know that his injury might be work-related until the surgeon who subsequently operated on his back testified to that effect during the course of a deposition on August 31, 1973. It is argued that this Court’s decision in Lewis v Chrysler Corp, 394 Mich 360; 230 NW2d 538 (1975), and in Krol, supra, mandate a ruling that the notice periods under the statute should not have begun to run until August 31, 1973. The plaintiff argues that, pursuant to those cases, the notice periods should not begin to run until he actually knew or should have known that the injury was work-related.
The record itself belies the plaintiffs representation that he did not learn of the work-relatedness of his injury until August 31, 1973. The plaintiff testified at the hearing that he had no back trouble prior to July of 1972. The plaintiff further testified that shortly after the accident he experienced cramping of the legs as well as pain in his back. Finally, in the month of August the pain drove him to see his family doctor, Dr. Bouten. The plaintiff initially indicated that he couldn’t remember whether he told Dr. Bouten about his injury at work. However, during the course of direct examination, the plaintiff corrected himself and indicated that he was sure he had told Dr. Bouten of his work injury. Most tellingly, the deposition testimony of the surgeon who eventually operated on the plaintiffs back in November of 1972 clearly indicates that when the plaintiff first was treated by him on November 3, 1972, plaintiff traced his injury to the incident at work:
”Q. And when was it, sir, that you first saw this man?
"A. November 3, 1972.
”Q. Were any complaints made to you at that time? What did the man tell you, or what did the doctor tell you, either way?
’A. Well, the man’s chief complaint at that time consisted of low back pain and lower extremity pain with predominate right sciatic radiation.
"Q. Was any history given to you as to onset?
"A. The patient indicated that he had sustained an injury to his back at work while driving a vehicle.”
Thus there is clear evidence in the record that at least as early as November 3, 1972, the plaintiff had concluded that his problems were traceable to the incident at work. However, defendant’s first notice of injury and notice of claim were not received until March of 1973. The record supports the conclusion of the WCAB that the plaintiff did not comply with the notice requirements of MCLA 418.381; MSA 17.237(381).
Affirmed.
Kavanagh, C.J., and Williams, Levin, Coleman, Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred. | [
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Levin, J.
(for remand). While I agree with my colleague that the requisite "minimum contacts” justifying the exercise of long-arm jurisdiction may be established without proof of "solicitation, sale or delivery within the state of injury by the defendant [manufacturer] to the plaintiff”, an out-of-state manufacturer is not subject to Michigan long-arm jurisdiction merely because one of its products was brought into Michigan and caused harm to a Michigan resident and it was foreseeable that might occur. "Proof alone that a nonresident caused an effect in Michigan that was foreseeable does not establish a relationship to Michigan such as to make it fair and reasonable to subject the non-resident to jurisdiction.” Khalaf v Bankers & Shippers Ins Co, ante, 404 Mich 134, 145; 273 NW2d 811 (1978).
Unless products of the manufacturer are distributed in this state pursuant to its marketing system in such a manner and to such an extent that it can properly be said that the manufacturer has "purposefully avail[ed] itself of the privilege of conducting activities” within this state, it does not ordinarily have "substantial connection” 5*or requisite minimum contacts with this state justifying the exercise of long-arm jurisdiction.
A manufacturer’s marketing system is generally seen as a purposeful availment of the privilege of acting in a forum in which it has reason to know its products are distributed pursuant to that system.
The record in the instant case shows only that products of the Swiss manufacturer, Solis Apparatus Manufactories, Ltd., are sold by it to independent importers located in New York, Chicago and Los Angeles. It does not appear whether any Solis products are distributed beyond the states of New York, Illinois and California as part of Solis’ marketing system, and there is no basis for an inference either that its products were in fact distributed in Michigan or that Solis had reason to know that its products were distributed in Michigan through the system established for marketing them in this country. Absent such evidence, Michigan is not a "fair forum” although it is foreseeable that a purchaser in Illinois may be a Michigan resident or that an Illinois purchaser may bring or send the product to Michigan.
While the record does not support a finding that Solis purposefully availed itself of the privilege of conducting its activities in Michigan and that Michigan is a fair forum, it appears from other evidence not part of the record on appeal that Solis products have been extensively distributed in this state and that the failure of proof was inadvertent and so insubstantial, appraising it in light of the unsettled state of the jurisprudence, that the case should not on that account be dismissed.
I would remand to the trial court for further proceedings with leave to the plaintiff to adduce further proofs regarding the extent of Solis’ availment of the privilege of conducting its activities in this state.
Fitzgerald, J., concurred with Levin, J.
Ryan, J.
(to reverse). I agree with Justice Levin that a manufacturer’s marketing system may generally be viewed as a purposeful availment of the privilege of acting in a forum in which it has reason to know its products are distributed pursuant to that system. And I agree that the record before us does not support a finding that the distribution system shown to be employed by defendant constituted such a purposeful availment.
However, I cannot countenance looking outside of the record to support a remand, in this instance, to allow plaintiff another opportunity to develop a factual record to support such a finding. Consequently, I would reverse the Court of Appeals.
Coleman, J., concurred with Ryan, J.
Blair Moody, Jr., J.
(to affirm). This products liability action arose out of injuries sustained by the plaintiff, DeAnn Hapner, in Ann Arbor, Michigan, while using a portable hair dryer manufactured by the defendant, Solis, a Swiss corporation. The issue on appeal is whether the Court of Appeals, in holding Solis subject to the limited personal jurisdiction of a Michigan court, erred by exceeding the limits of constitutional due process. We conclude that the Court of Appeals did not err.
Facts
In December, 1970, Benjamin Hapner purchased a portable "professional” hair dryer from his barber in Chicago as a present for his daughter DeAnn. DeAnn was then a high school senior living with her parents. As a college freshman, DeAnn took the hair dryer with her to the University of Michigan, Ann Arbor, in September of 1971. Several months later DeAnn noticed a noise in the dryer and took it home to Chicago for repairs. Subsequently, DeAnn brought the repaired hair dryer back to Ann Arbor, where, on January 28, 1972, she was injured by electrical shocks and was severely burned on both hands when the hair dryer came apart.
In February, 1973, plaintiffs filed suit in Michigan naming , a Chicago distributor and an Illinois importer-wholesaler as defendants. Twenty months later, Solis, the Swiss manufacturer of the hair dryer, was added as a party defendant.
Solis moved for an accelerated judgment on the grounds that the Michigan court lacked personal jurisdiction over it and that such jurisdiction would violate Solis’ constitutional right to due process under the Fourteenth Amendment to the United States Constitution. Solis’ affidavit submitted in support of this motion recited, in part, the following facts:
1. Solis is incorporated under the laws of Switzerland and has its principal place of business in Glattbrugg, Switzerland.
2. Solis maintains no offices, telephones, or bank accounts in the United States.
3. Solis has no sales or service representatives, no employees or agents in the United States.
4. Solis does not own, use or possess any real or tangible personal property situated within the United States.
5. Solis exports its products to the United States to three independent importers located in New York, Chicago and Los Angeles, but Solis does not control the business operations of its importers.
Acknowledging that the question before the court was a "very close one”, the trial judge entered an accelerated judgment dismissing Solis from the case on the ground that Solis lacked the requisite minimum contacts with the state for a Michigan court to maintain jurisdiction without violating the defendant’s right to due process of law. The Court of Appeals reversed and remanded. 71 Mich App 263; 247 NW2d 375 (1976). We granted leave to appeal. 399 Mich 882 (1977).
I
Statutory authority for limited in personam jurisdiction over nonresident defendants is provided for in MCL 600.715; MSA 27A.715, which states in part:
"The existence of any of the following relationships between a corporation or its agent and the state shall constitute a sufficient basis of jurisdiction to enable the courts of record of this state to exercise limited personal jurisdiction over such corporation and to enable such courts to render personal judgments against such corporation arising out of the act or acts which create any of the following relationships:
"(2) The doing or causing any act to be done, or consequences to occur, in the state resulting in an action for tort.”
Based upon the broad language of the statute, a nonresident defendant who causes injury to occur within this state may be subjected to the jurisdiction of Michigan courts without the defendant ever having been within the state boundaries.
In previous decisions, this Court has viewed the statute as an attempt by the Legislature to expand to its full potential limited personal jurisdiction of Michigan courts over nonresidents and, noting no constitutional problems, has liberally construed the statute. Sifers v Horen, 385 Mich 195; 188 NW2d 623 (1971); Woods v Edgewater Amusement Park, 381 Mich 559; 165 NW2d 12 (1969). Assuming the accuracy of plaintiffs’ pleadings, defendant Solis did cause a consequence to occur in the state resulting in an action for tort and is subject to the limited jurisdiction of the statute.
Nevertheless, since the present controversy involves fewer contacts with Michigan than previously decided cases, this Court must examine the present facts within the context of the due process constitutional limitations established by the United States Supreme Court. Such analysis requires examination of three key cases involving in personam jurisdiction over nonresident defendants.
II
The modern constitutional test for the assertion of personal jurisdiction over a nonresident defendant by a state court was first set forth in the case of International Shoe Co v Washington, 326 US 310; 66 S Ct 154; 90 L Ed 95 (1945). That case established the due process "minimum contacts” test. In order to subject a nonresident defendant to in personam jurisdiction, the defendant must have certain "minimum contacts” with the state such that the maintenance of suit does not offend traditional notions of fair play and substantial justice. Whether due process is satisfied depends upon the quality and nature of the nonresident’s activity in relation to the fair and orderly administration of the state’s law. International Shoe, supra, 319. Thus, constitutional jurisdiction over a nonresident defendant requires not only fairness to the defendant, but also a consideration of the forum state’s interest in the administration of its laws.
In McGee v International Life Ins Co, 355 US 220; 78 S Ct 199; 2 L Ed 2d 223 (1957), the United States Supreme Court reexamined the constitutional limitations placed upon in personam jurisdiction and found that one contact with a state was sufficient for purposes of due process. More than 20 years ago, Mr. Justice Black, writing for a unanimous Court, explained the policy considerations which required expansion of a state’s power over a nonresident defendant:
"Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve parties separated, by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity.” McGee, supra, 222-223.
Additionally, that Court referred to the "manifest interest” of the state in providing a forum for its residents to seek effective redress.
The trilogy was completed less than a year after McGee, when the Supreme Court decided Hanson v Denckla, 357 US 235; 78 S Ct 1228; 2 L Ed 2d 1283 (1958). Proceedings had been instituted in a Florida court to invalidate an inter vivos trust created by a Pennsylvania resident with a Delaware trust company. Under Florida law, the nonresident trustee was an indispensable party to the suit. Thus, the question presented was whether the Florida court could obtain valid in personam jurisdiction over the nonresident trustee. The majority opinion reasoned that Florida had no jurisdiction over the trustee:
"The cause of action in this case is not one that arises out of ah act done or transaction consummated in the forum State. * * * [T]his action involves the validity of an agreement that was entered without any connection with the forum State.
"The application of [the] rule will vary with the quality and nature of the defendant’s activity, but it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” Hanson, supra, 251-253.
Hanson, therefore, is viewed as a restrictive approach to state courts exercising jurisdiction over nonresident defendants. Under Hanson, the "minimum contact” established in International Shoe and McGee must be some act by which the nonresident defendant purposefully avails himself of the privilege of conducting activities within the forum state.
Ill
To resolve the present controversy, we must decide how International Shoe, McGee, Hanson and their progeny apply to a modern products liability case. A conflict exists between legal scholars as to whether the Hanson case should be confined to its facts and is, therefore, inapplicable in products liability actions.
However, even within a framework of utilizing Hanson in products liability cases, courts are split as to how Hanson applies. The restrictive application of Hanson requires the manufacturer to have had control over the process through which its product reached the forum and the consumer. In the absence of solicitation, sale or delivery within the state of injury by the defendant to the plaintiff, jurisdiction over the nonresident manufacturer is denied.
Hodge v The Sands Manufacturing Co, 151 W Va 133; 150 SE2d 793 (1966), and Moss v Winston- Salem, 254 NC 480; 119 SE2d 445 (1961), are cases which typify this narrow approach. In both cases, the defendant nonresident manufacturers distributed their products through independent middlemen. Therefore, while not specifically stating a privity requirement, these cases impliedly read Hanson to require privity of contract between the manufacturer and the consumer.
This application of Hanson ignores the obvious complexity of commercial transactions in today’s product-oriented consumer market. The presence of a product within a particular forum cannot always result from direct shipment by the manufacturer. The movement of products may be accomplished by the consumer, by independent middlemen, or may have resulted from distribution by a second or third manufacturer who purchased defendant’s product as a component for its goods. If a manufacturer could avoid personal jurisdiction in products liability actions whenever the distribution of its product is handled by independent middlemen or distributors, manufacturers would obviously be able to completely avoid the consequences of placing defective products in the stream of commerce. Nonresident manufacturers should not be permitted to use circuitous distribution channels to avoid defending actions brought to recover for injuries allegedly caused by their products. Alliance Clothing Ltd v Denver Dist Court, 187 Colo 400; 532 P2d 351 (1975).
The present case provides an excellent example of the lack of fairness and substantial justice which would result from such an approach. Solis’ affidavit submitted to the trial court maintains that Solis has no contacts with the United States. Based upon this affidavit, Solis could contest jurisdiction anywhere in the United States, despite the fact that Solis imposes no territorial restrictions over the three independent distributors who nationally advertise Solis’ product and distribute the hair dryer to beauticians and barbers throughout the country for professional use and retail sale.
The better application of Hanson, and that which we adopt today, sustains jurisdiction over a nonresident manufacturer in the state where the injury occurs whenever that manufacturer places its product in the stream of national or international commerce and could reasonably foresee that the product will enter the forum state. As articulated by the California Supreme Court in Buckeye Boiler Co v Los Angeles Superior Court, 71 Cal 2d 893; 80 Cal Rptr 113; 458 P2d 57 (1969), this application of Hanson in products liability cases focuses on the economic reality of manufacturing enterprises, rather than on the outward form of business transactions.
"A manufacturer’s economic relationship with a state does not necessarily differ in substance, nor should its amenability to jurisdiction necessarily differ, depending upon whether it deals directly or indirectly with resi- . dents of the state.
"A manufacturer whose products pass through the hands of one or more middlemen before reaching their ultimate users cannot disclaim responsibility for the total distribution pattern of the products. If the manufacturer sells its products in circumstances such that it knows or should reasonably anticipate that they will ultimately be resold in a particular state, it should be held to have purposefully availed itself of the market for its products in that state.
"When a plaintiff is allegedly injured in the forum state by a defect in a nonresident manufacturer’s product, the question whether that product’s use or pur chase was an isolated instance or part of a continuous course of business in the state is relevant but not necessarily decisive in determining the existence or nonexistence of the requisite jurisdictional activity. Only if isolated use or purchase conclusively establishes lack of foreseeability that the product will enter the state is the isolation necessarily fatal to jurisdiction over the manufacturer; in that event there is a manifest lack of purposeful activity on the part of the manufacturer.” Buckeye, supra, 902-904. (Citations omitted.)
Therefore, within this analysis, placement of the product into the stream of commerce and reasonable foreseeability that the product will enter the forum state are two factors to be examined by a court in determining whether a nonresident manufacturer has engaged in purposeful activity under Hanson and is thus subject to limited personal jurisdiction.
Application of one or both of these factors can be found in the following cases which subjected alien and native nonresident manufacturers to personal jurisdiction. For jurisdiction over alien corporations see: Alliance Clothing Ltd, supra; Certisimo v Heidelberg Co, 122 NJ Super 1; 298 A2d 298 (1972), aff'd sub nom Van Eeuwen v Heidelberg Eastern, Inc, 124 NJ Super 251; 306 A2d 79 (1973); Shoei Kako Co v San Francisco Superior Court, 33 Cal App 3d 808; 109 Cal Rptr 402 (1973); Deutsch v West Coast Machinery Co, 80 Wash 2d 707; 497 P2d 1311 (1972).
For jurisdiction over native nonresident corporations see: Duignan v A H Robins Co, 98 Idaho 134; 559 P2d 750 (1977); Edmundson v Miley Trailer Co, 211 NW2d 269 (Iowa, 1973); Smith v Temco, Inc, 252 So 2d 212 (Miss, 1971); Metal-Matic, Inc v Eighth Judicial Dist Court, 82 Nev 263; 415 P2d 617 (1966); Ehlers v US Heating & Cooling Manu factoring Corp, 267 Minn 56; 124 NW2d 824 (1963); and the landmark case of Gray v American Radiator & Standard Sanitary Corp, 22 Ill 2d 432; 176 NE2d 761 (1961).
Having adopted the two-factor (stream of commerce-foreseeability) analysis, we must now apply these factors to the instant case. The product in question is a hair dryer which is mass-produced in Switzerland for distribution and sale in international commerce and for diffuse distribution in the United States by three independent importers located in California, New York and Illinois. Clearly, Solis placed its product into the broad stream of commerce. The only question remaining is whether Solis could reasonably foresee that its product would be used in Michigan.
In determining reasonable foreseeability on the part of a manufacturer, the nature of the defective product and the volume of distribution can be used as yardsticks of foreseeability. The defective product in the present case is a portable hair dryer. Residents of the United States are extremely mobile in occupational, educational and recreational activities. Therefore, a portable hair dryer, like an electric razor or other personal grooming equipment, foreseeably crosses state borders as a normal part of the individual consumer’s life style.
Defendant Solis placed this portable hair dryer in the national stream of commerce and reasonably and fairly could foresee the ultimate use of this product in Michigan or any other state. Traditional notions of fundamental fairness and substantial justice are not offended by subjecting the present defendant to the limited personal jurisdiction of a Michigan court.
Furthermore, public policy dictates the result reached in this case. In upholding jurisdiction over a Japanese pipe manufacturer, the Washington Court of Appeals stated:
"[W]e believe that foreseeability that the product could be used in the forum state is the most important factor in products liability cases. * * * With the breakdown in international commercial barriers, and the resulting fact that a substantial portion of goods sold to American consumers today is manufactured in foreign lands, we would be striking a serious blow at consumer protection if we did not recognize such jurisdiction. We cannot expect consumers in this state to travel to Japan and other parts of the world to litigate injuries from tortious acts committed in this state — fairness to the foreign manufacturer does not require that hardship to local consumers.” Omstead v Brader Heaters, Inc, 5 Wash App 258, 271-272; 487 P2d 234, 242-243 (1971), aff'd 80 Wash 2d 720; 497 P2d 1310 (1972). (Opinion of the Court of Appeals adopted as opinion of the Supreme Court.)
Conclusion
Accordingly, we hold that when a nonresident manufacturer places its product in the stream of national or international commerce and can reasonably foresee that the product will enter the forum state, an injury in Michigan resulting from a product’s intended use provides a sufficient contact with the state to assert jurisdiction over the manufacturer without offending any notions of fair play and substantial justice.
The Court of Appeals decision that due process is not violated by a Michigan court maintaining limited personal jurisdiction over the defendant is affirmed and this cause is remanded to the trial court. Costs to plaintiffs-appellees.
Kavanagh, C.J., and Williams, J., concurred with Blair Moody, Jr., J.
International Shoe Co v Washington, 326 US 310, 316; 66 S Ct 154; 90 L Ed 95; 161 ALR 1057 (1945).
I also note my disagreement with the statement that "[i]n previous decisions, this Court has viewed the statute as an attempt by the Legislature to expand to its full potential limited personal jurisdiction of Michigan courts over nonresidents”. The statement in Sifers v Horen, 385 Mich 195, 199; 188 NW2d 623 (1971), of that import was with reference to the subsection of the statute concerning "the transaction of any business” in this state:
"The courts of those states having 'long-arm’ statutes similar to that of Michigan which confer, specifically, limited personal jurisdiction over defendants based on 'the transaction of any business within the state,’ have generally construed their statutes as extending the state’s jurisdiction to the farthest limits permitted by due process.” (Emphasis supplied.)
The Michigan statute, in contrast with statutes or rules of other states (Cal Code Civ Proc, § 410.10; NJ Court Rules, R R 4:4-4[d]), does not contain a provision subjecting non-residents to jurisdiction to the fullest extent permissible under the Federal Constitution.
Hanson v Denckla, 357 US 235, 253; 78 S Ct 1228; 2 L Ed 2d 1283 (1958).
McGee v International Life Ins Co, 355 US 220, 223; 78 S Ct 199; 2 L Ed 2d 223 (1957).
Shaffer v Heitner, 433 US 186, 215; 97 S Ct 2569; 53 L Ed 2d 683 (1977).
Our research indicates that the due-process limitations of personal jurisdiction over nonresident manufacturers in product liability actions have not as yet been decided by the United States Supreme Court.
See Currie, The Growth of the Long Arm: Eight Years of Extended Jurisdiction in Illinois, 1963 U Ill L Forum 533; Leflar, Conflict of Laws, 34 NYU L Rev 20 (1959).
See Anno: Products Liability: In Personam Jurisdiction Over Nonresident Manufacturer, 19 ALR3d 13; Anno: Construction and Application of State Statutes or Rules of Court Predicating In Personam Jurisdiction Over Nonresidents or Foreign Corporations on the Commission of a Tort Within the State, 24 ALR3d 532.
As noted, additional confusion is created by variance in statutory language and in courts’ interpretations of when a particular tort action accrues. Some jurisdictions hold that the tortious act in a product liability case occurs in the manufacturing process and, thus, the action accrues in the jurisdiction where manufactured. See, for example, Feathers v McLucas, one of the cases decided in Longines-Wittnauer Watch Co v Barnes & Reinecke, Inc, 15 NY2d 443; 261 NYS2d 8; 209 NE2d 68 (1965). A number of jurisdictions invoke the traditional choice of law rule that the place of the wrong is where the last event takes place which is necessary to render the actor liable. See, for example, Gray v American Radiator & Standard Sanitary Corp, 22 Ill 2d 432; 176 NE2d 761 (1961).
Michigan follows the Illinois view that a tort action accrues when the last element necessary to state the cause of action occurs. Connelly v Paul Ruddy’s Equipment Repair & Service Co, 388 Mich 146; 200 NW2d 70 (1972); Coury v General Motors Corp, 376 Mich 248; 137 NW2d 134 (1965).
One of the principal arguments against assuming personal jurisdiction over alien corporations is that the court, by forcing a defend ant to bear the burden of litigating abroad in a strange forum, violates fundamental concepts of fairness. See Note, Jurisdiction Over Alien Manufacturers in Product Liability Actions, 18 Wayne L Rev 1585 (1972). This burden is substantially lessened by MCL 600.741; MSA 27A.741, which provides that in cases where limited personal jurisdiction is involved, on defendant’s motion, the court must require the plaintiff to post a bond as security for court costs and actual expenses of the defendant incurred in defending the action (excluding attorney’s fees).
To the extent that this holding is contrary to language set forth in Moyses v Spartan Asphalt Paving Co, 383 Mich 314; 174 NW2d 797 (1970), that language alone is overruled. | [
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Blair Moody, Jr., J.
The question presented is whether plaintiff’s workers’ compensation claim is barred by her failure to notify her employer of a compensable injury within the three-month statutory period when her employer’s group health and accident insurance carrier furnished the injured employee alternative medical benefits during the limitation period.
We hold that an employer impliedly waives his right to notice when his group health and accident insurance carrier furnishes alternative medical benefits to an employee who has suffered an otherwise compensable injury. This implied waiver only suspends the running of the statute of limitations for filing the compensation claim from the date alternative benefits are commenced until the payments are terminated or notice is given that payment of the medical benefits has been terminated (whichever occurs later).
I
In February, 1971, plaintiff, Brenda Girlish, sus tained a back injury in the course of her employment as a processor for defendant, Acme Precision Products, Inc. Plaintiff testified that she felt a "ripping sensation” in her lower back while pushing a heavy box of die castings to a co-worker. As a processor, plaintiff was routinely required to push such boxes to co-workers.
The exact date of the back injury was disputed. However, plaintiff ceased working for defendant on February 28, 1971, due to an attack of influenza. The hearing referee and the Worker’s Compensation Appeal Board (WCAB) eventually determined the date of the back injury also to be February 28.
On March 1, 1971, plaintiff visited her doctor for treatment of her influenza. Additionally, she filed an insurance claim form for health and accident benefits for her influenza condition on March 8, 1971.
Plaintiff first received treatment for her back injury from her doctor on March 10, 1971. (The WCAB subsequently found, upon remand, that the three-month statutory notice requirement began to run from March 10. MCL 418.381; MSA 17.237[381]. See fn 3, infra.)
On April 5, 1971, defendant employer’s health and accident insurance carrier received a supplemental notice from the attending physician concerning plaintiff’s back injury. Since this was the first notice given to the insurance carrier of plaintiff’s back injury, the carrier apparently ordered an investigation to determine the nature of the injury.
In a letter dated April 23, 1971, the insurance carrier informed plaintiff, "In connection with your weekly indemnity claim, we have arranged to have you examined by Dr. Charles Zinn”. That examination occurred April 30, 1971.
On May 27, 1971, employer’s insurance carrier contacted plaintiff by telephone and indicated that she was no longer entitled to weekly benefits. Evidently, Dr. Zinn concluded that she was not disabled for purposes of health and accident beneñts. This telephone conversation was confirmed by a letter to plaintiff dated May 28, 1971.
Plaintiffs’ benefits were terminated as of April 30, 1971. She had received health and accident benefits during the months of March and April, 1971.
On June 8, plaintiff’s doctor notified the insurance carrier that he had seen plaintiff several times concerning her disability and diagnosed it as 'Tumbo sacral instability”. He recommended no work. On June 21, in a letter to plaintiff, the insurance carrier acknowledged the doctor’s letter, and stated: "After a review of all available medical information in this file it has been determined that no additional weekly indemnity benefits can be paid.”*
In his decision of September 11, 1972, the hearing referee found that plaintiff’s back injury arose out of and in the course of plaintiff’s employment with defendant. MCL 418.301; MSA 17.237(301). However, he denied benefits because plaintiff had failed to give defendant notice of injury within three months as required by MCL 418.381; MSA 17.237(381).
Thereafter, an appeal was taken to the WCAB. On March 21, 1974, the board affirmed the hearing referee. The board apparently agreed that a compensable injury occurred but also denied benefits because the notice period had run. The Court of Appeals denied leave to appeal on November 20, 1974. On August 19, 1975, this Court remanded the case to the board for reconsideration in light of Lewis v Chrysler Corp, 394 Mich 360; 230 NW2d 538 (1975). 394 Mich 836 (1975).
The board again affirmed the decision of the hearing referee that plaintiffs claim must fail for lack of timely notice. The Court of Appeals again denied leave to appeal. We granted leave to appeal. 400 Mich 803 (1977).
II
The Worker’s Disability Compensation Act of 1969 is silent as to whether a plaintiffs compensation claim is barred by her failure to notify her employer of an otherwise compensable injury within three months when the employer’s group health and accident carrier furnishes the injured employee alternative benefits during the limitation period. MCL 418.101 et seq.; MSA 17.237(101) et seq.
The applicable notice requirement, as embodied in MCL 418.381; MSA 17.237(381), merely states that:
"No proceedings for compensation for an injury under this act shall be maintained, unless a notice of the injury has been given to the employer within 3 months after the happening thereof and unless the claim for compensation with respect to the injury, which claim may be either oral or in writing, had been made within 6 months after the occurrence of the same.”
This Michigan notice statute, enacted and reenacted before fringe benefits such as health and accident insurance were provided for industrial workers, does not instruct the Workmen’s Compensation Bureau how to proceed in cases where alternative benefits, in lieu of compensation, are voluntarily paid to an employee who has suffered a compensable injury.
In many states, the notice statute specifically provides that the payment of any voluntary compensation by the employer during the notice period suspends or tolls the running of the statute until such payments cease. Cf. 3 Larson, Workmen’s Compensation Law, § 78.43(a), and the cases cited therein.
In other states, where there is no explicit statu tory provision, the same result is often arrived at by the application of a waiver theory. Specifically, in many jurisdictions, it has been held that the employer waives his right to notice during the period within which he makes other voluntary compensation payments. See generally Anno: May notice of injury or claim contemplated by Workmen’s Compensation Act be waived, 78 ALR 1306, and the cases cited therein.
"The general idea is that an employee who has been receiving compensation * * * cannot reasonably be expected to have made claim during that period, and should not, upon cessation of voluntary payments * * * , be allowed [a shorter time period] in which to file his claim.” 3 Larson, supra, p 15-113.
Many controversies have arisen as to what constitutes a voluntary compensation payment which suspends the running of the notice period. However, most jurisdictions have held that the payment of medical benefits by a private employer-employee insurance plan (such as the one involved in this case) constitutes the voluntary payment of compensation and thus suspends or tolls the notice statute. See generally Anno: Payments, or furnishing medical or hospital services, or burial, by employer or his insurer, to employee after injury, as affecting time for fling claim under Workmen’s Compensation Act, 144 ALR 606, and the cases cited therein.
It would be an ironic and inequitable rule of law if this Court were to deny an employee, who has suffered an otherwise compensable injury, compensation benefits because an employer or his sickness and accident carrier voluntarily paid alternative benefits during the three-month notice period. This is especially true because the unsophisticated employee, possibly on the advice of the employer or union representative, is usually operating on the justifiable belief that the alternative benefits received are the correct benefits. The employee, who is receiving benefits, has no reason to believe there is any further need to act to preserve his right to compensation.
Furthermore, it should not go unnoticed in the case at bar that it took the sickness and accident carrier, presumably more knowledgeable than the plaintiff in such matters, 2 months and 18 days to determine that she was not ill but had suffered a work-related injury. We cannot agree that the plaintiff should be denied compensation for an otherwise work-related compensable injury because the employer did not learn for 3 months and 12 days (only 24 days after the insurance carrier reached the same conclusion) that plaintiff had been injured and was not ill.
We also believe that it is idle to suggest that the employer in this case was unduly prejudiced by the 12-day delay in the receipt of notice. During the period in which the plaintiff was receiving sickness and accident benefits, she was receiving regular medical treatments. The record of those treatments was readily available had the employer wished to contest the compensability of the plaintiff’s injury.
Based upon the equitable considerations discussed, supra, and in the absence of a legislative mandate to the contrary, we hold that an employer impliedly waives his right to notice during that period of time when his insurance carrier voluntarily furnishes alternative medical benefits to an employee who has suffered an otherwise compensable injury. This implied waiver, however, only suspends the running of the notice statute for filing the compensation claim from the date alternative benefits are commenced until the payments are terminated or notice is given that payment of the medical benefits has been terminated (whichever occurs later).
We must emphasize, however, the narrowness of today’s holding. An implied waiver situation will only arise:
(1) when the notice period is running because an employee has the requisite knowledge of a possible work-related disability, Lewis, supra; and
(2) when an employer or his insurance carrier voluntarily furnishes during the notice period alternative medical benefits to an employee who has suffered an otherwise compensable injury; and
(3) when the referee and (or) the WCAB do not find any attempted fraud on the part of the employer or the employee in either the furnishing or the acceptance of the alternative benefits.
Ill
In the instant case, the aforementioned holding means that the WCAB should determine the date upon which alternative benefits were commenced and the date upon which notice was given that benefits were to be terminated (since that appears to be the later date). The board should then subtract this period of time from the three-month notice period. If it appears, as it certainly does in this case, that notice was then given within the applicable notice period, compensation benefits are to be awarded.
The order of Worker’s Compensation Appeal Board is vacated. This case is remanded to the board for proceedings not inconsistent with this opinion. No costs; a public question.
Kavanagh, C.J., and Williams and Levin, JJ., concurred with Blair Moody, Jr., J.
On the face of the letter, sent within the statutory three-month period, appeared: "bcc: Mr. Hal Kempe — Acme Precision Products, Inc.”
The letter also indicated, "cc: Mr. Hal Kempe, Acme Precision Prod., Inc.”
This case was evidently remanded to the WCAB for reconsideration in light of Lewis because plaintiff may have confused her influenza symptoms with her back ailment. Therefore, it was conceivable that she was not aware that her back pains were work-related.
On remand, however, the WCAB found that on March 10,1971, the notice period began to run because plaintiff then had knowledge of her disability, or could have reasonably discovered or had reason to believe that her disability was work-related. The board believed it was required to deny benefits because the statutory notice period ran from March 10 to June 10, 1971. Since it was determined that defendant employer did not receive notice of injury until June 21, 1971, plaintiff’s claim was barred because it was filed 12 days late.
It should be noted that the Legislature originally enacted the pertinent portion of this notice provision in 1912. Since 1912, the Legislature has reenacted basically the same language each time it has seen fit to amend the compensation statute as a whole. See 1912 (1st Ex Sess) PA 10, part II, § 15. Also see 1919 PA 64, 1943 PA 245, 1954 PA 175, 1965 PA 44, 1969 PA 317.
The repetitive reenactment of this same statutory language regarding the notice period leads us to the inevitable conclusion that the Legislature has never considered the effect which the payment by the employer of voluntary alternative benefits should have on the three-month notice period.
See, for example, Gourley v Grand Island, 168 Neb 538; 96 NW2d 309 (1959).
The Nebraska statute, as interpreted by the Nebraska Supreme Court, specifically provided that the voluntary payment of compensation by the employer suspends or tolls the notice period:
"Defendant contends that this action is barred by section 48-137, RRS 1943, which provides in part: 'In case of personal injury, all claim for compensation shall be forever barred unless, within one year after the accident, the parties shall have agreed upon the compensation payable under this act, or unless, within one year after the accident, one of the parties shall have filed a petition as provided in section 48-173. * * * Where, however, payments of compensation have been made in any case, such limitation shall not take effect until the expiration of one year from the time of making of the last payment.’
"This action was commenced in the compensation court by the filing of a petition on December 11,1957.
"We have held: 'Where an employer furnishes medical, surgical, and hospital services to an employee, * * * the payments therefor constitute payment of compensation within the meaning of the employers’ liability act.’ [Citation omitted.]
"Under the conditions existing here the defendant had furnished the plaintiff medical services and medicines. He was then working or on sick leave with pay. He was being paid the compensation which at that time he was in a position to demand. It accordingly must be held that plaintiff was paid compensation up to January 2, 1957. This is sufficient to toll the running of the one year statutory provision under its express terms.
"We accordingly find that the defense of the statutes is not sustained.” (Emphasis added.)
Pine v State Industrial Commission, 148 Okla 200; 298 P 276; 78 ALR 1287 (1931), contains a lengthy discussion which provides a historical perspective for employing a waiver theory in those cases where notice provisions are silent regarding the voluntary payment of compensation by employers. Also see Poole v E I duPont De Nemours & Co, 227 SC 232; 87 SE2d 640 (1955), as an example of a case where a waiver theory is utilized.
Also see, 3 Larson, Workmen’s Compensation Law, § 78.43(a), fn 84, and § 78.43(b), fn 98, for an exhaustive compendium of state cases which have held the payment of medical benefits by an employer constitutes the voluntary payment of compensation.
"In any event, where the purposes of a statute can be achieved only by extending the operation of its language to its most inclusive meaning, even beyond its common meaning, that is done. And where a literal interpretation would produce gratuitous results beyond the purpose for which the act was passed, its language will be construed restrictively to embrace less than its customary meaning in order to avoid those results.
"The rule for the construction of remedial statutes is that cases within the reason, though not within the letter, of a statute shall be embraced by its provisions; and cases not within the reason, though within the letter, shall not be taken to be within the statute.” (Emphasis added.) 2A Sutherland Statutory Construction (4th ed), The Equity of the Statute, §§ 54.01-54.08, especially § 54.04, pp 358-359.
Workers’ compensation legislation is remedial legislation; its procedural requirements should be liberally interpreted to effectuate substantial justice.
Also see 3 Sutherland Statutory Construction (4th ed), General Welfare Legislation, § 71.06.
We have not discussed the possibility of fraud in this opinion because it is apparent from the facts that neither the employer nor the employee was attempting to deceive the other in the furnishing or the acceptance of the incorrect benefits in this case.
However, this Court can foresee a situation where it is conceivable that the employer might intentionally "lull” the employee into accepting the incorrect benefits in order to avoid a workers’ compensation award. We can also imagine a set of circumstances where the employee might knowingly accept the incorrect benefits in order to obtain compensation benefits at some later date.
If an employer was found to be perpetrating such a fraud, the employer would be estopped from utilizing the statute of limitations as a defense and the implied waiver need not be considered. On the other hand, if an employee attempted to perpetrate such a fraud, that employee would be estopped from invoking the implied waiver theory set forth in this opinion. | [
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Per Curiam.
We are presented with prosecutorial misconduct, in the form of eliciting evidence which the trial judge had already ruled inadmissible. Because the prosecutor’s misconduct eviscerated the defense theory we must reverse the defendant’s conviction.
I
Midday on March 25, 1975, Allard Shelton was in his Detroit market with five-year-old Dana Nixon. He was killed during the course of a robbery. In a complaint filed April 16, 1975, defendant was charged with felony murder and armed robbery.
The police investigation had initially focused on Charles Edwards. His wife then came forward and, with a grant of immunity, implicated the defendant and her sister, Carol Sims. She testified that the three of them went to the market on March 25 with the intention to rob it. She waited outside while the defendant and Sims entered. She heard a shot, and the defendant and Sims came out with money and cigarettes.
Carol Sims testified against the defendant also. The fact that she had been allowed to plead guilty to manslaughter and was promised a sentencing concession was brought to the jury’s attention. She corroborated Mrs. Edwards’ version of the transaction and said that the defendant took the victim into a backroom after robbing him at gunpoint.
The defense theory was that Edwards actually committed the offense and that the two sisters lied to protect Edwards. The jury convicted the defendant of both charges, and the trial judge imposed two life sentences. On June 21, 1977, the Court of Appeals affirmed defendant’s conviction of felony murder, but reversed the armed robbery conviction because it was the same armed robbery on which the felony murder conviction was based.
II
Before trial, the judge ruled that Dana Nixon was not a competent witness. Dana had been at the scene of the crime and had viewed a lineup which included Edwards and did not identify him. The record shows that after Sergeant Newcomb, the investigating officer, had stated that a lineup including Edwards had been held, defendant objected when Newcomb was asked to identify the witness for whom the lineup was held. Out of the presence of the jury, the prosecutor made an offer of proof which included the fact that Dana could make no identification at the lineup. Defense coun sel objected and commented "you [the judge] are going to say she is incompetent to testify, which I agree with. But, yet [the prosecutor], the way he’s coming by innuendo and says, well, she couldn’t identify Charles Edwards”. The judge responded, "I will restrict that and eliminate it. I won’t allow the question about who the show-up was conducted for”. (Emphasis supplied.)
It is clear that the judge had precluded any question directly or indirectly on whether Dana Nixon identified Edwards. In response to the prosecutor’s inquiry, the judge specifically instructed him as to what he could ask the witness, "Yes, that you had a show-up which has been answered. You can ask him whether or not the defendant, Charles Edwards, was charged with this offense and permitted to ask him whether or not he released him and told him to bring his wife down”.
Despite this clear warning, after the weekend recess, the prosecutor placed before the jury the fact that a lineup which included Charles Edwards had been held for Dana Nixon. The examination was as follows:
”Q. What date did you arrest Charles Edwards?
"A 4/4/75.
”Q. April 4, 1975. Did you interrogate him in connection with this particular case?
"A. Yes, sir, I did.
”Q. Did you investigate him?
"A. Yes, sir.
”Q. Did you place him in a lineup for the witness, Dana Nixon?
"A. Yes, sir.”
Defense counsel immediately objected. The prosecutor replied by twice stating in the presence of the jury his understanding that the judge had only ordered, him not to reveal the results of the lineup. The judge sustained the objection and commented, "I didn’t intend for any results of any lineup that was held for Dana Nixon to be given to the jury by inference”. The court then went on to instruct the jury that Dana Nixon was incompetent to testify and that the jury should not rely "upon some incompetent testimony or actions”.
The prosecutor nevertheless chose to comment on the objected-to testimony in closing argument:
"Sergeant Newcomb testified he was the officer in charge of the case going to the scene, arresting Charles Edwards on April 4, 1975, and interrogating him, further investigating him, a lineup was held for a little girl, Dana Nixon, and as a result of his investigation, Mr. Edwards was released, never charged in this particular matter.”
Ill
Despite the midtrial instruction, the fact remains that incompetent evidence, negating defendant’s defense, was placed before the jury and later argued to the jury by the prosecutor. The jury was thereby left with the clear implication that Dana Nixon could not identify Edwards.
The prosecutor, despite careful warning by the trial judge and repeated objection by defense counsel, placed before the jury, in the form of a question and later in argument, incompetent, damaging evidence. His question resulted in ineradicable prejudice, and was asked and answered before the court could intervene. His argument reiterated the prejudice. In such a case any attempt by the court to remove the damage is futile, "for here the effective control is for the examining counsel and not for the judge”. Paul v Drown, 108 Vt 458, 462; 189 A 144; 109 ALR 1085 (1937).
The prosecutor’s conduct violated professional standards. The ABA Project on Minimum Standards for Criminal Justice, Standards Relating to the Prosecution Function (Approved Draft, 1971), § 5.6(b), states:
"It is unprofessional conduct for a prosecutor knowingly and for the purpose of bringing inadmissible matter to the attention of the judge or jury to offer inadmissible evidence, ask legally objectionable questions, or make other impermissible comments or arguments in the presence of the judge or jury.”
See, also, Code of Professional Responsibility and Canons, DR 7-106(C).
Counsel’s deliberate insertion of incompetent prejudicial evidence into a case is cause for reversal. Pettersch v Grand Rapids Gas Light Co, 245 Mich 277, 284-285; 222 NW 123, 126 (1928). Regardless of the means by which improper evidence is placed before the jury, a reviewing court will reverse despite curative instruction when the instruction is not likely to be effective. Scripps v Reilly, 38 Mich 10, 15 (1878); Thomas v Byron Twp, 168 Mich 593; 134 NW 1021 (1912).
Defendant’s theory — that Charles Edwards committed the crime — was seriously undermined by the prosecutor’s reference to the lineup held for Dana Nixon. The trial court’s instruction concerning the reference to the lineup would not, in our judgment, dissipate the prejudicial effect of the inadmissible evidence in the jurors’ minds.
In lieu of granting leave to appeal, pursuant to GCR 1963, 853.2(4), we reverse the defendant’s conviction of first-degree murder and remand the case to Recorder’s Court for the City of Detroit for further proceedings consistent with this opinion.
Kavanagh, C.J., and Williams, Levin, and Blair Moody, Jr., JJ., concurred.
Ryan, J.
(to affirm). I respectfully dissent from the opinion for reversal of the defendant’s murder conviction.
A close reading and careful analysis of the trial transcript satisfies me that there is no evidence that the prosecuting attorney deliberately disobeyed the trial judge’s instructions concerning the lineup which was conducted for a witness, Dana Nixon, who was later found by the trial court to be incompetent. Rather, my reading of the transcript leads me to conclude that the prosecuting attorney was attempting, in good faith, to comply with his understanding of the trial judge’s instructions concerning the lineup, and the question posed was not unfairly prejudicial to defendant.
I
During the course of defendant’s trial, on Friday morning, September 26, 1975, the prosecutor questioned Sergeant Newcomb, one of the investigating officers, concerning the arrest of Charles Edwards and a lineup that was subsequently conducted involving Edwards.
The defense objected to this testimony on the ground that the prosecution was " * * * going to talk about the results of some kind of show-up”. (Emphasis supplied.)
The trial court responded that " * * * if he does attempt to, you can object again. You know when to object, and I will rule on that”.
The prosecutor resumed his examination of Newcomb and asked whether any witnesses who had been connected with the casé were called down to the "show-up”. The defense objected. In the course of the ensuing discussion, the trial judge excused the jury.
The following colloquy is quoted at some length because it strongly suggests the good faith of the prosecutor’s subsequent questions based on his understanding, or misunderstanding, of the court’s ruling. It should be remembered that the trial judge had earlier ruled that five-year-old Dana Nixon was not a competent witness.
"The Court: What questions do you intend to ask?
"[The prosecutor]: I intend to ask him, he testified he interviewed him, whether a show-up was held for Dana, and Dana could make no identification. Then, further, what he told Charles Edwards, and that was to bring in Patricia Edwards and later on getting into Patricia Edwards, he released Charles Edwards after his investigation on April 4, 1975, and he was never charged in connection with this case.
"Mr. Moore [defense counsel]: I get the feeling the court is about to rule with the prosecution, why is it?
"The Court: I am about to rule.
"Mr. Moore: Favorable to the prosecution?
"The Court: I don’t know if it’s favorable or not. It could be favorable to the defendant. I am not concerned who it is favorable to. He said he conducted a show-up with the witness, Dana Nixon, and she could not identify this man, your defendant.
"Mr. Moore: She could not identify Charles Edwards. Wasn’t there — Dana Nixon couldn’t identify anybody. You are going to say she is incompetent to testify, which I agree with. But, yet Mr. [Prosecutor], the way he’s coming by innuendo and says, well, she couldn’t identify Charles Edwards.
"The Court: I will restrict that and eliminate it. I won’t allow the question about who the show-up was conducted for.
"Mr. Moore: The prosecutor already had to say — you let him say the show-up was conducted. That’s already said and allowed.
"[The prosecutor]: In other words, I am not permitted to go into the results?
"The Court: That’s what I’m saying, especially from Dana Nixon, because, she’s incompetent.
"Mr. Moore: The court has the right to say look, I’m going to allow you to say — ask whether or not the man was and was not charged in this matter, and that and that alone. If the court — it must without getting into a lot of other did you talk to him after talking investigate, then, et cetera, did you release him. That suggests more.
"The Court: Let me ask if that’s what the prosecutor wants to do.
"[The prosecutor]: Your Honor, I had intended to ask whether he arrested Charles Edwards, whether he interrogated him, whether after interrogating whether or not he released him or charged him, what he told Charles Edwards at the time of the release, whether or not a show-up was conducted and whether or not any identification was made, and by whom, and I made an offer of proof that Dana Nixon did attend the show-up wherein Charles Edwards was in there and could make no identification. You have ruled, I cannot go into what the results of it were.
"The Court: Dana—
"[The prosecutor]: The lineup, the show-up.
"The Court: Right.
"[The prosecutor]: However, may I be permitted to go into the other part of the offer of proof?
"The Court: Yes, that you had a show-up which has been answered. That you can ask him whether or not the defendant, Charles Edwards, was charged with this offense and permitted to ask him whether or not he released him and told him to bring his wife down.
"[The prosecutor]: That’s what I intend to do.
"Mr. Moore: I object, your Honor, I think it’s hearsay, detrimental and improper examination.
"The Court: It is not hearsay.” (Emphasis supplied.)
A fair reading of this exchange makes it clear that the trial judge said he would "restrict and eliminate” any statement by Sergeant Newcomb, either directly or by innuendo, that Dana Nixon could not identify Edwards after viewing the lineup. The judge further stated he would not "allow the question about who the show-up was conducted for”.
Apparently confused by this somewhat ambiguous ruling, the prosecutor twice attempted to clarify his understanding that he was being precluded from inquiry into the results of the lineup, and twice the judge stated that was his ruling.
At the conclusion of this discussion, shortly after noon, the jurors returned and were instructed that they were excused until Monday morning.
Two and one half days later, on Monday, September 29, 1975, the trial resumed and the following occurred:
"By [the prosecutor]:
"Q. Sergeant Newcomb, when we adjourned Friday, I believe I was questioning you about arresting Charles Edwards, isn’t that correct?
"A. Yes.
"Q. What date did you arrest Charles Edwards?
"A. 4-4-75.
”Q. April 4, 1975. Did you interrogate him in connection with this particular case?
"A. Yes, sir, I did.
"Q. Did you further investigate him?
"A. Yes, sir.
”Q. Did you place him in a lineup for the witness, Dana Nixon?
"A. Yes, sir.
"Mr. Moore [defense counsel]: Your Honor, I’m going to object. This court specifically ruled that Dana Nixon was incompetent to testify in this case. Friday, we went over this and over this and the one thing the court indicated he should not say, Dana Nixon, he placed him in a lineup relative to Dana Nixon. I don’t know why— if the court — if the witness is incompetent in the court —to testify as the court ruled relative to that little girl, everything she did was incompetent. I think the prosecutor knows that and it was agreed Friday he wouldn’t say that.
"[The prosecutor]: My understanding of the ruling was I would be entitled to ask Sergeant Newcomb whether a lineup was held and not the results.
"Mr. Moore: The court specifically stated that you were not supposed to talk about that little girl. She is incompetent, and we don’t have any way of cross-examining her relative to that. I defined it on the record, your Honor, that was the specific directions of the court. It was you could ask whether or not he was put in a lineup, but you couldn’t talk about Dana Nixon.
"[The prosecutor]: My understanding of the ruling was I couldn’t get into the results, but I could question if a lineup was held where Mr. Edwards was in the lineup for Dana Nixon, the five-year-old girl.
"The Court: For the purpose of clarification, I didn’t intend for any results of any lineup that was held for Dana Nixon to be given to the jury by inference. That’s not to mention the fact that a lineup was held, no harm done in saying a lineup was held, but don’t go any further.
"[The prosecutor]: All right.
"The Court: Let me say this, the reason why the court is saying that, the testimony of Dana Nixon is not competent, you cannot hear it. Because, under the laws of this state, any witness, 10 years or younger, the court must examine that witness to determine whether or not the witness is competent to be a witness, and that they know what it is to tell the truth and understand what the proceedings are, and just know what she or he might be talking about. I did examine this witness outside of your presence. I’m satisfied she is incompetent, she doesn’t know what to say, she doesn’t know the difference between the truth or a lie. Therefore, her testimony would be of no value to you, and I ruled that and that is my responsibility. That is what I have determined, that she is not competent to testify, therefore, anything she did or said, you cannot hear that. You cannot base your opinion upon some incompetent testimony or actions; do you understand that?” (Emphasis supplied.)
It is thus evident that having twice obtained the judge’s answer that it was the results of the lineup which should not be disclosed, the prosecutor believed that to be the court’s ruling and did not question Newcomb about those results. The judge himself, in the foregoing discussion, stated for the third time that he intended to exclude the results of the lineup.
Thus, while the trial judge did initially instruct the prosecutor not to mention that the lineup was held for Dana Nixon, and the prosecutor nonetheless did so, the context in which this occurred is important. The questioning followed a manifestly good faith effort on the part of the prosecutor to correctly understand the ruling, two statements by the trial judge that it was the results of the lineup that he wanted to keep from the jury, and a two- and-a-half-day interruption in the trial.
The characterization, in the opinion to reverse, of the prosecutor’s questions as a " * * * deliberate insertion of incompetent prejudicial evidence * * * ” and as " * * * violating] professional standards * * * ” must have been made upon an inadequate examination of the record or focusing on portions of the record taken out of context. The trial judge does not appear to have perceived any violation of his order, did not sustain defense counsel’s objection on Monday morning, and did not reprimand the prosecutor.
More importantly, the reference to Dana Nixon was simply not prejudically unfair to defendant and does not warrant nullifying the murder conviction.
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Blair Moody, Jr., J.
We granted leave to appeal and consolidated the following three cases: Franges v General Motors Corp, 398 Mich 810 (1976); Schalk v Michigan Sewer Construction Co, 398 Mich 810 (1976); Betker v General Motors Corp, 398 Mich 810 (1976).
Each of these cases involves a recovery by an employee/personal representative and his employer/insurance carrier against a third-party tortfeasor. The common issue presented is whether and to what extent the dollar amount credited to the employer as advance payment of future workers’ compensation benefits should be included in computing the share of recovery expenses (legal fees and costs) attributable to the employer or its workers’ compensation insurance carrier. MCLA 418.827; MSA 17.237(827).
Facts
Certain common elements appear in these three cases. In each case, the intervenor, the individual workers’ compensation insurance carrier, has appealed the trial court’s apportionment of settlement recovery expenses reached in the third-party tortfeasor action. While computing the apportionment of total expenses by slightly different methods, all three trial judges basically followed the reasoning of Crawley v Schick, 48 Mich App 728; 211 NW2d 217 (1973). In determining the interests of the insurance carrier, each court included the dollar amount credited as advance payment of future workers’ compensation benefits.
Franges
In February of 1970, the plaintiff, Joseph Franges, Jr., an employee of a company insured by Michigan Mutual Liability Company, sustained a work-related injury on the premises of General Motors Corporation. The Worker’s Disability Compensation Bureau issued an open-end award requiring plaintiff’s employer through its carrier Michigan Mutual to pay workers’ compensation benefits at the rate of $104 per week for Franges’ life or until his disability ended.
Two years later, a third-party damage action against defendant General Motors Corporation was filed and Michigan Mutual intervened as a party plaintiff pursuant to § 827 of the Worker’s Disability Compensation Act. On December 13, 1974, plaintiffs-appellees settled their cause of action against the defendant for $120,000 and on April 7, 1975, an opinion and order for disbursement of funds were filed by the Wayne Circuit Court as follows:
Gross Recovery $120,000.00
Insurer’s Reimbursement — 27,184.03
Total Cost of Recovery — 40,807.17
Advance Payment Credit $ 52,008.80
The total cost of recovery was apportioned between the parties as follows:
Employee’s Pro Rata Share (34%) $ 13,874.55
Insurer’s Pro Rata Share (66%) 26,932.62
Total Cost of Recovery $ 40,807.17
The Court of Appeals in an unpublished per curiam opinion affirmed the disbursement of the trial court on March 30, 1976.
Schalk
Plaintiff-appellee, Allen Schalk, also received injuries during the course of his employment. Plaintiff brought a negligence action against the defendants as third-party tortfeasors and the workers’ compensation insurance carrier, Aetna Casualty and Surety Company, intervened. This action resulted in a settlement of $125,000 of which plaintiff’s wife, Mildred Schalk, received $15,000 and the injured plaintiff $110,000. On July 1, 1974, an order was entered apportioning the cost of recovery and approving the distribution of settlement proceeds as follows:
Gross Recovery $110,000.00
Insurer’s Reimbursement — 22,588.13
Total Cost of Recovery — 38,832.95
Advance Payment Credit $ 43,411.87
The total cost of recovery was broken down between the parties as follows:
Employee’s Pro Rata Share (40%) $ 15,533.18
Insurer’s Pro Rata Share (60%) 23,299.77
Total Cost of Recovery $ 38,832.95
The Court of Appeals determined that the trial judge incorrectly applied the Crawley formula. The insurer’s pro rata share should have been 64.6973% or $25,122.87, and $48,578.92 should have been treated as advance payment credit. Nevertheless, the court affirmed the awards since the employee failed to contest the decision. 62 Mich App 658; 233 NW2d 825 (1975).
Betker
This cause of action arose out of the accidental death of plaintiff-appellee’s husband, Ralph Betker. Mr. Betker, an employee of Carlson Brothers, Incorporated, fell 40 feet to his death while attempting to repair a heating and ventilation unit located in the defendant General Motors Corporation’s Fisher Body plant. Plaintiff-administratrix, Gloria Betker, commenced a wrongful death action and Hardware Mutual Casualty Company, Carlson Brothers’ workers’ compensation carrier, intervened as a party plaintiff. While a trial on the merits was in progress, the parties agreed to settle the suit for $150,000. The Oakland Circuit Court’s order apportioning the costs of recovery and distributing the proceeds was entered on December 12, 1974, as follows:
Gross Recovery $150,000.00
Insurer’s Reimbursement — 23,825.20
Total Cost of Recovery — 57,131.99
Advance Payment Credit $ 19,935.00
The total cost of recovery was apportioned between the parties as follows:
Employee’s Pro Rata Share (70.83%) $ 40,466.59
Insurer’s Pro Rata Share (29.17%) 16,665.40
Total Cost of Recovery $ 57,131.99
On August 2, 1976, the Court of Appeals granted plaintiff-administratrix’s motion to affirm the disbursement of the trial court.
Discussion
The basic issue before this Court is whether the employer or its insurance carrier in a third-party action is entitled by statute to a credit against workers’ compensation benefits potentially payable in the future, without sharing the burden of the recovery expenses (attorney fees and costs).
The statutory provisions concerning litigation expenses incurred in actions against third-party tortfeasors which have been referred to the courts for interpretation fall into three general classifications:
(1) those statutory provisions which contain no express reference to attorneys’ fees and costs incurred by the employee in the third-party tort action;
(2) those statutes which provide for the deduction from the third-party recovery fund of the attorneys’ fees and costs incurred by the employee in the third-party litigation, but which do not expressly provide for the apportionment of such fees and costs between the employee and the employer or insurance carrier;
(3) those statutory provisions which contain an express direction that the attorneys’ fees and costs incurred by the employee in the third-party tort action should be apportioned between the employee and the employer or compensation insurance carrier.
Anno: Workmen’s Compensation: Attorney’s Fee or Other Expenses of Litigation Incurred by Employee in Action Against Third Party Tortfeasor as Charge Against Employer’s Distributive Share, 74 ALR3d 854.
In 25 jurisdictions, including Michigan, "when the suit is brought or recovery is effected by the employee, and sometimes in all cases, the carrier is obligated to pay a portion of the attorney’s fee out of his share, usually in proportion to his share of the recovery”. 2A Larson, Workmen’s Compensation Law, § 74.32.
Section 827 of the Worker’s Compensation Act of 1969, MCLA 418.827; MSA 17.237(827), sets forth the procedure that must be followed in Michigan suits against third-party tortfeasors. Subsections 5 and 6, the controlling provisions for these cases, prescribe how the judgment is to be divided. Since the Michigan statute fits firmly into the third category, we will evaluate only those interpretations of statutory provisions which contain express directions for apportionment of recovery expenses between the employee and the employer or insurer.
Within this third category of statutory provisions, three general approaches have been developed by the courts in dealing with the problem of whether the future compensation credit should be included as an interest of the insurer when computing the apportionment of fees.
One approach is that the employer’s pro-rata share of expenses should be based upon the total benefit realized — including reimbursement for compensation benefits already paid to the employee and relief from future compensation liability. This view will be generically referred to as the Pennsylvania approach. It has been followed in a number of jurisdictions across the country, and is the basis for the Crawley v Schick formula of our own Court of Appeals. The Pennsylvania approach was generally applied in each of the instant cases by the trial court and approved by the Court of Appeals.
A second approach, which we will label the Missouri approach, is that the employer’s share should be based exclusively upon the amount of reimbursement for compensation benefits already paid. This approach to apportioning recovery expenses does not take into consideration credit for any future compensation liability. The rationale for adopting this second view, despite the potential windfall to the insurer in receiving future credit without incurring the normal expenses of recovering that credit, is based upon the contingent nature of the benefit to the insurer.
A recent New Jersey case and a Pennsylvania Federal district court decision illustrate what we believe to be a third, more equitable view. This third approach, "pari passu”,* provides a means whereby the employer and insurer pay their share as they receive their benefit and follows the statutory requirement that the employer and insurer pay a proportionate share of the recovery expenses.
Thus, in interpreting the Michigan statutory language in question, we are mindful of the three basic approaches for apportioning the costs of producing dollars which represent future compensation credit.
Statutory Construction
Subsections 5 and 6 of MCLA 418.827; MSA 17.237(827) prescribe how the third-party judgment is to be divided:
"(5) In an action to enforce the liability of a third party, the plaintiff may recover any amount which the employee or his dependents or personal representative would be entitled to recover in an action in tort. Any recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery, shall first reimburse the employer or carrier for any amounts paid or payable under this act to date of recovery and the balance shall forthwith be paid to the employee or his dependents or personal representative and shall be treated as an advance payment by the employer on account of any future payments of compensation benefits.
"(6) Expenses of recovery shall be the reasonable expenditures, including attorney fees, incurred in effecting recovery. Attorney fees, unless otherwise agreed upon, shall be divided among the attorneys for the plaintiff as directed by the court. Expenses of recovery shall be apportioned by the court between the parties as their interests appear at the time of the recovery.” (Emphasis added.)
Appellant insurers argue that subsection 5 establishes the following priorities for the distribution of a recovery against a third party:
(1) deduction of recovery expenses, including attorney fees, deemed to be reasonable;
(2) reimbursement to the carrier for past benefits paid;
(3) and distribution of any balance to the employee, to be credited against any future benefits to which the employee would be entitled as a result of his injury.
In support of this priority system the insurers refer us to the Delaware statutory provisions which are virtually identical to MCLA 418.827(5), 418.827(6); MSA 17.237(827X5), 17.237(827X6), and to the Delaware Supreme Court’s interpretation of those provisions in Cannon v Container Corp of America, 282 A2d 614, 616 (Del, 1971). The Delaware Court held that the three priorities previously referred to were clearly established by the Delaware provisions. In addition, that Court not only approved a 100% reimbursement to the compensation carrier of monies previously paid in benefits, but further held that the insurer did not have to pay any portion of the costs of recovery.
We cannot accept that reasoning of the Dela ware Court which ignores completely the final sentence of subsection (f): "The expenses of recovery above mentioned shall be apportioned by the court between the parties and as their interests appear at the time of said recovery.” 19 Del Code 2363(f). The mirror language in the Michigan statute is the final sentence of subsection 6: "Expenses of recovery shall be apportioned by the court between the parties as their interests appear at the time of the recovery.” MCLA 418.827(6); MSA 17.237(827X6).
The Delaware priority system does not take into account the apportionment of recovery expenses between the insurer and the employee required by the final sentences of the Delaware and Michigan statutes. Those sentences make apparent the intent of the state legislatures to require the court to apportion the recovery expenses.
On numerous occasions, this Court has discussed the rule of construction to be employed when interpreting statutory language in order to determine legislative intent. In construing legislative intent it is mandatory, if possible, to construe an act as a whole, thus avoiding the construction of one provision in such a manner as to negate another. Joslin v Campbell, Wyant & Cannon Foundry Co, 359 Mich 420; 102 NW2d 584 (1960). Subsection 5, which spells out how judgments in third-party workers’ compensation cases are to be divided, cannot be read to establish strict priorities for distribution in view of the mandatory nature of the word "shall” in the final sentence of subsection 6. Such a reading of subsection 5, which establishes the system of priorities adopted in Cannon, supra, would render void the language of subsection 6 requiring the apportionment of expenses.
Another frequently applied rule of statutory construction is that statutes should be construed to prevent absurdity, hardship, injustice or prejudice to the public interest. Gardner-White Co v State Board of Tax Administration, 296 Mich 225; 295 NW 624 (1941); Zawacki v Detroit Harvester Co, 310 Mich 415; 17 NW2d 234 (1945); General Motors Corp v Unemployment Compensation Commission, 321 Mich 604; 33 NW2d 90 (1948). Therefore, in order to fairly interpret the provision governing the apportionment of expenses, it is necessary for us to examine these concepts in light of the purpose for providing an opportunity for recovery against third-party tortfeasors.
Under the various state workers’ compensation systems the cost of industrial injuries is shared by the employee and industry, and the employee absorbs a substantial portion of his loss. Atleson, Workmen’s Compensation: Third Party Actions and the Apportionment of Attorney’s Fees, 19 Buffalo L Rev 515, 520 (1970). As stated in Arthur Larson’s classic treatise on workers’ compensation law:
"A compensation system, unlike a tort recovery, does not pretend to restore to the claimant what he has lost; it gives him a sum which, added to his remaining earning ability, if any, will presumably enable him to exist without being a burden to others.” 1 Larson, Workmen’s Compensation Law, § 2.50.
As pointed out by Professor Allan McCoid, one of the major reasons for retention of rights against third parties, despite the general acceptance of the enterprise liability concept of workers’ compensation laws, is protection of the worker and his family. The retention of such rights acknowledges that benefits provided by existing compensation acts are not expected to be full payment for all losses suffered. McCoid, The Third Person in the Compensation Picture: A Study of the Liabilities and Rights of Non-Employers, 37 Texas L Rev 389, 401 (1959).
Additionally, another primary aim of this legislation is to provide the insurer a right to recover from the tortfeasor compensation expenditures. The Michigan statute provides that in the event the injured employee does not commence a third-party action within one year after the occurrence of the injury, the employer or insurer can proceed to enforce the interest of such employee.
Accordingly, we believe that one of the major purposes for the Legislature permitting actions by both the injured employee and the insurer is to provide the opportunity for full recovery by each and thereby place the liability for the injury and the resulting cost upon the negligent party.
Pursuant to the statute, past compensation pay ments made by the insurer to the employee are to be recovered by the insurer before the employee may benefit. Nevertheless, any decision on our part which would require a non-negligent injured employee to bear the full burden of recovery expenses, including a recovery that excuses a compensation insurer’s future obligation, is contrary to this legislative purpose. The injured employee would thereby receive less than his full share of the recovery (after deduction of apportioned expenses).
Likewise, a determination that would obligate the insurer to pay recovery expenses attributable to amounts credited as advance payment of future compensation liability, when future compensation payments may never be required, would also be contrary to the legislative purpose. The insurer would thereby receive less than its full share of the recovery (after deduction of apportioned expenses).
We view the crux of the issue presented by these cases as being a determination of what the Legislature intended by the use of the word "interests” within the statutory language: "as their [the employee or his representative and the employer or its insurance carrier] interests appear at the time of the recovery.” MCLA 418.827(6); MSA 17.237(827X6).
Subsection 5 sets forth the three "interests” of the parties that "appear” in a recovery from a third-party tortfeasor and, thus, defines the word "interests” as it is used in the final sentence of subsection 6. The employee or his dependents or personal representative has only one interest which may appear, a lump sum dollar recovery that is treated as an advance payment of future compensation benefits. The employer or its insur anee carrier may receive two interests in any given third-party action. First, there is the reimbursement interest: the refunding of monies previously paid or payable as workers’ compensation benefits as of the date of judgment. Additionally, a second interest appears when the dollar amount of recovery exceeds the insurer’s reimbursement. That interest is a dollar amount obtained by the employee but treated by the employer or insurer as a future credit against payment of additional compensation benefits.
Since the excess received by the employee is also an interest of the insurer which appears at the time of recovery and excuses future workers’ compensation liability, the insurer must bear the cost of receiving its part of the benefit of this interest. In view, however, of the contingent quality of this interest, we hold that payment of the apportionment percentage of total costs based upon gross recovery will be made as this interest of the insurer becomes dollars credited against compensation liability.
Accordingly, we conclude that the third view mentioned heretofore, e’pari passu”, is the approach which best reflects the intention of the Legislature to effectuate the purposes of the Worker’s Disability Compensation Act.
This conclusion is buttressed by two other considerations. First, if we were to adopt the Missouri approach, we would be requiring the trial judge to disregard completely the interest which the insurer receives as future credit. Such an approach would ignore the statutory language and give a windfall to the insurer. It would also encourage delays at the trial court level and favor employees in the metropolitan areas where clogged civil dockets delay trials for years, while disadvantaging employees in sparsely populated areas of the state. As stated in Kroll v Hyster Co, 398 Mich 281, 299; 247 NW2d 561 (1976) (opinion by Williams, J.):
"If the interest of the insurer, and therefore its share of the expenses, is calculated on the basis of the amount of benefits the insurer had paid the employee at the time of recovery, delay becomes the ally of the employee. The longer the period of time which passes before the time of recovery, the more benefits the insurer will have actually paid at the time of recovery, and therefore the greater the share of the expenses it will have to carry. It is very difficult to believe that the Legislature intended to create a situation where an aggrieved party would be rewarded for delaying a suit until long after the cause of the grievance, and for prolonging the course of litigation.
"Moreover, employees in virtually identical situations would have substantially different recoveries because one employee brought his suit in a court where docket congestion was particularly a problem, causing an unintentional delay in the time of recovery which will in turn increase the share of the expenses the insurer will be liable for.”
Conversely, the Pennsylvania view as reflected by Crawley and applied by the trial courts in these cases requires the trial judge in most instances to include the total net recovery initially received by the employee as an interest of the insurer when calculating the insurer’s share of expenses. This could result in a potential windfall to the employee in view of the contingent nature of the future credit. The insurer could be charged for expenses but, due to happenstance, may never receive the benefit of the full advance payment credit.
Neither result is compatible with the purpose of the legislation. Therefore, we interpret subsections 5 and 6 as requiring a six step post-recovery procedure when the parties themselves cannot agree upon a division of the recovery expenses. In working through this step-by-step procedure, the Franges facts will be employed for illustrative purposes.
I. Apportionment Percentage
The statutory language of subsection 6 makes it clear that "expenses of recovery” include costs plus reasonable attorney fees. Therefore, the trial court must first determine what would be a reasonable attorney fee before dividing that fee between the attorneys for the plaintiffs.
As the statute indicates, if the division of attorney fees has been agreed upon or stipulated to by counsel, then as long as the fee percentage of recovery is not excessive under the guidelines of GCR 1963, 928, the agreement will govern the division of fees. However, if there is no such agreement, the attorney fees "shall be divided among the attorneys * * * as directed by the court”.
In Kroll, supra, 295, Justice Williams set forth succinctly the factors to be considered by the trial court in dividing attorney fees:
"The court in making the division should consider the value of the services performed by attorneys, the agreement each attorney had with his client, and the necessity of ensuring that attorneys working on a contingent fee basis are compensated sufficiently to ensure that the incentive to take third-party actions on such a fee basis is protected. If the total reasonable attorneys’ fees determined by the court are less than the sum of the amounts originally agreed to by the attorneys and their clients, the fees of both attorneys should be appropriately reduced, assuming the insurer’s attorney contributed in the preparation and trying of the suit.”
In Franges, the parties do not dispute the division of fees or the reasonableness of expenditures. The total cost of recovery amounted to $40,807.17.
Once the total cost of recovery is ascertained, the division of those expenses between the plaintiffs must be determined. Since subsection 6 requires the expenses of recovery to be apportioned between the insurer and the employee, the first step is to determine what percentage of the gross recovery the total expenses of recovery represent. This "apportionment percentage” is computed by dividing the gross recovery into the total cost of recovery:
Total cost of recovery $40,807.17
Gross recovery of $120,000.00
= Apportionment Percentage of 34.005975%
II. Insurer’s Reimbursement
The trial court must then determine the amount to reimburse the insurer for compensation previously paid. The insurer in Franges had paid $27,184.03 in compensation benefits as of the date of settlement:
Insurer’s Reimbursement $ 27,184.03
III. Apportionment of Expenses for Reimbursement Interest
The insurer’s portion of the costs of recovery representing its reimbursement interest is determined by multiplying its reimbursement recovery by the apportionment percentage:
Insurer’s Reimbursement $ 27,184.03
Apportionment Percentage X .34005975
Insurer’s Share of Cost of Reimbursement Recovery $ 9,244.19
IV. Employee’s Recovery
By statute the amount remaining after reimbursement is received by the employee, his dependents or personal representative. Thus, the total recovery less the insurer’s reimbursement equals the employee’s recovery:
Gross Recovery $120,000.00
Insurer’s Reimbursement — 27,184.03
Employee’s Recovery $ 92,815.97
V. Apportionment of Expenses for Employee’s Recovery
This portion of recovery expenses is determined by multiplying the balance of the recovery (the employee’s recovery) by the apportionment percentage. Although the insurer may ultimately receive the benefit, this share of recovery expenses is initially borne by the employee since he initially receives the benefit:
Employee’s Recovery $ 92,815.97
Apportionment Percentage (34.005975) X .34005975
Employee’s Share of Cost of Recovery $ 31,562.98
VI. Insurer’s Future Credit
By statute, the dollar amount actually received by the employee, his dependents or personal representative is treated as a credit against any future compensation the employer or insurer would have been required to pay but for the third-party recovery. Therefore, the total recovery less the insurer’s reimbursement and the employee’s share of cost of recovery equals the insurer’s future credit:
Gross Recovery $120,000.00
Insurer’s Reimbursement - 27,184.03
Employee’s Share of Cost of Recovery -31,562.98
Insurer’s Future Credit $ 61,252.99
The cost of recovery amount deducted in the example above does not include the insurer’s share of cost of reimbursement recovery (see III, supra) since that dollar amount is paid out of the insurer’s reimbursement. The inclusion of that sum of $9,244.19 in the cost of recovery subtraction would amount to a double subtraction of the insurer’s share of cost of reimbursement recovery. Such a procedure would disadvantage the insurer by further reducing the amount of the insurer’s future credit, thereby resulting in earlier exhaustion of the future credit and earlier resumption of the insurer’s liability to pay compensation benefits.
VII. Apportionment of Recovery Expenses for Future Compensation Credit
Along with the actual recovery which benefits the employee, an interest which benefits the insurer is discernible at the time of settlement or judgment. That contingent future interest is the dollar amount recovered by the employee after payment of recovery costs and credited to the insurer as advance payment of future compensation benefits. In fact, this contingent interest begins to accrue and to vest the first day after settlement, provided the employee would have qualified for continued compensation but for the third-party tortfeasor recovery.
Therefore, we decide that when and as the insurer’s contingent interest becomes a liability but for the third-party recovery, the insurer must reimburse the employee for the expenses of recovery chargeable to that amount. This shall be accomplished by multiplying each credit as it accrues by a second apportionment percentage to arrive at an amount the insurer must then pay to the employee.
This second apportionment percentage is computed by dividing the employer’s or insurer’s future credit into the employee’s share of cost of recovery.
Employee’s Share of Cost of Recovery $31,562.98
= Apportionment Percentage for reimbursement to employee for cost of recovery 51.52888%
Employer’s-Insurer’s Future Credit $61,252.99
According to the existing order of the Worker’s Compensation Bureau, employee Franges is to
receive an award of $104 per week for the rest of his life or until his disability ceases. Thus, each week Franges is entitled to receive compensation benefits but for the third-party recovery, the insurer must pay the following to the employee:
Employee’s Compensable Wage Loss $ 104.00
Apportionment Percentage (51.52888%) X .5152888
Reimbursement to Employee by Insurer for Cost of Recovery $ 53.59 per week
Until the future credit is exhausted, the same formula applies to all other claims compensable under the Worker’s Disability Compensation Act. The insurer will reimburse the employee an amount equal to any of the employee’s future expenses which are compensable under the act multiplied by the second apportionment percentage, the apportionment percentage for reimbursement to the employee for cost of recovery.
Conclusion
The foregoing seven steps are to be applied to the two other cases under consideration. These cases are remanded to the trial court for a redivision of the respective recoveries consistent with this opinion. This opinion and its apportionment formulae are to be applied prospectively. Only those cases pending on appeal in which this issue has been specifically raised are subject to this determination. Remanded for further proceedings; jurisdiction is retained.
No costs, neither party prevailing in full.
Kavanagh, C.J., and Williams, Fitzgerald, Ryan, JJ., concurred with Blair Moody, Jr., J.
Kavanagh, C.J.
I have signed Justice Moody’s opinion because I am now persuaded that the construction for which I wrote in Kroll v Hystér Co, 398 Mich 281; 247 NW2d 561 (1976), is too limited.
Although each of the consolidated cases involves a settlement or consent judgment, this opinion applies equally to jury and non-jury judgments.
An open-end award is one which grants compensation to an employee for an indefinite period of time or so long as the facts on which the award was predicated continue.
Constance Franges, the wife of the injured employee, joined in the action but did not receive an individual award in the settlement.
The gross recovery figure does not include the $15,000 amount in the settlement representing plaintiff-wife’s recovery for loss of consortium.
Unlike the advance payment credit amounts in the Franges disbursement order and in the Schalk Court of Appeals opinion, the $19,935 credit is not equal to the gross recovery minus the insurer’s reimbursement and total cost of recovery. Franges and Schalk involve open-end compensation benefits; this case involves survivor’s benefits with a specific dollar amount ceiling.
2A Larson, Workmen’s Compensation (Supp, 1977), § 74.32, p 14-233 lists the applicable statutes as follows:
’’Alabama: Ala Code tit 26, § 312. Florida: Fla Stat Ann 440.39. Hawaii: Hawaii Rev Stat 386-8. Idaho: Idaho Code 72-223. Illinois: Ill Ann Stat ch 48, § 138.5 (Smith-Hurd). Indiana: Ind Stat Ann 22-3-2-13 (Burns). Kansas: Kan Stat Ann 44-504, only as to employer’s subrogation suit. Kentucky: Ky Rev Stat 342.700. In employee’s suit, employer is subrogated to entire amount less attorneys’ fees. Maryland: Md Ann Code art 101, § 58. As to employer’s suit see fn 54, supra, this subsection, under Maryland. Michigan: MCLA 418.827 [MSA 17.237(827)]. Apportionable as interests of parties appear. Minnesota: Minn Stat Ann 176.061. Missouri: Mo Ann Stat 287.150 (Vernon). Nebraska: Neb Rev Stat 48-118. Aliter, if no notice of suit is given. New Hampshire: NH Rev Stat Ann 281:14. Apportioned by court 'as justice may require’. New Jersey: NJ Stat Ann 34:15-40. New York: See reference to amendment in discussion of Koutrakos v Long Island College Hospital [47 AD2d 500; 368 NYS2d 528 (1975)] fn 54, supra, this subsection, under New York. North Carolina: NC Gen Stat 97-10.2. North Dakota: ND Cent Code 65-01-09. Pennsylvania: Pa Stat Ann tit 77, § 671. Rhode Island: RI Gen Laws Ann 28-35-58. South Dakota: SD Compiled Laws Ann 62-4-40. Texas: Texas Rev Civ Stat Ann art 8307, § 6a (Vernon). Employer pays fees of employee’s attorney in employee’s third-party suit. Utah: Utah Code Ann 35-1-62. Virginia: Va Code Ann 65.1-43. Washington: Wash Rev Code Ann 51.24.010.”
The Pennsylvania approach has been adopted by the following states: Pennsylvania, New Jersey, Nebraska, Indiana, Minnesota, Utah and Virginia. Cases holding that the insurer’s future credit is to be included when apportioning recovery costs between the insurer and the employer include:
Anderson v Twin City Lines, 289 Minn 11; 182 NW2d 193 (1970); Indiana State Highway Commission v White, 259 Ind 690; 291 NE2d 550 (1973); Zuchowski v John S. Marvin Building Co, 197 Pa Super 520; 179 A2d 239 (1962); Wall v Conn Welding & Machine Co, 197 Pa Super 360; 179 A2d 235 (1962); Caputo v Best Foods, Inc, 17 NJ 259; 111 A2d 261 (1955); McMullen v Maryland Casualty Co, 123 NJ Super 248; 302 A2d 181 (1973); Prettyman v Utah State Department of Finance, 27 Utah 2d 333; 496 P2d 89 (1972); Gillotte v Omaha Public Power Dist, 189 Neb 444; 203 NW2d 163 (1973); Sheris v Travelers Insurance Co, 491 F2d 603 (CA 4, 1974), cert den 419 US 831; 95 S Ct 54; 42 L Ed 2d 56 (1974) (applying Virginia law).
The Missouri Supreme Court adopted this second approach in the case of Ruediger v Kallmeyer Brothers Service, 501 SW2d 56 (Mo, 1973).
The New Jersey court in Pagan v Hillside Metal Products, Inc, 140 NJ Super 154, 160; 355 A2d 690, 693 (1976), applied this third approach stating:
"The obligation of the carrier to pay to petitioner a pro rata share of the attorney’s fee only arises when a weekly payment otherwise due need not be paid due to the third-party recovery. There is no statutory basis for compelling the carrier to make payments to petitioner which it might not he required to make should the petitioner suffer an untimely demise and leave no dependents surviving.”
DiVirgilio v Norton Co, 344 F Supp 552 (WD Pa, 1972).
The Latin phrase "pari passu", meaning by equal progress or ratably, was used by the Pennsylvania Federal district court to describe the method of reimbursement payment by the employer to the employee for recovery expenses previously paid by the employee attributable to future compensation credit as and when the credit matures. DiVirgilio, supra, 554.
19 Del Code 2363(e), 2363© states:
"(e) In an action to enforce the liability of a third party, the plaintiff may recover any amount which the employee or his dependents or personal representative would be entitled to recover in an action in tort. Any recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery, shall first reimburse the employer or its workmen’s compensation insurance carrier for any amounts paid or payable under the workmen’s compensation act to date of recovery, and the balance shall forthwith be paid to the employee or his dependents or personal representative and shall be treated as an advanced payment by the employer on account of any future payment of compensation benefits.
"ffi Expenses of recovery shall be the reasonable expenditures, including attorney fees, incurred in effecting such recovery. Attorney fees, unless otherwise agreed upon, shall be divided among the attorneys for the plaintiff as directed by the court. The expenses of recovery above mentioned shall be apportioned by the court between the parties as their interests appear at the time of said recovery.”
.See Smith v School District No 6, Fractional, Amber Twp, 241 Mich 366; 217 NW 15 (1928).
MCLA 418.827; MSA 17.237(827) provides in part:
"(1) * * * If the injured employee or his dependents or personal representative does not commence the action within 1 year after the occurrence of the personal injury, then the employer or carrier, within the period of time for the commencement of actions prescribed by statute, may enforce the liability of such other person in the name of that person. Not less than 30 days before the commencement of action by any party under this section, the parties shall notify, by certified mail at their last known address, the bureau, the injured employee, or in the event of his <leath, his known dependents or personal representative or his known next of kin, his employer and the carrier. Any party in interest shall have a right to join in the action.
"(2) Prior to the entry of judgment, either the employer or carrier or the employee or his personal representative may settle their claims as their interest shall appear and may execute releases therefor.
"(3) Settlement and release by the employee is not a bar to action by the employer or carrier to proceed against the third party for any interest or claim it might have.”
Accord, McCoid, supra.
GCR 1963, 928, provides:
".1 In any claim or action for personal injury or wrongful death based upon the alleged conduct of another, in which an attorney enters into an agreement, express or implied, whereby his compensation is dependent or contingent in whole or in part upon successful prosecution or settlement or upon the amount of recovery, the receipt, retention, or sharing by such attorney, pursuant to agreement or otherwise, of compensation which is equal to or less than the fees scheduled in subrule 923.2 is deemed to be fair and reasonable. The receipt, retention, or sharing of compensation which is in excess of such scheduled fees shall be deemed to be the charging of a 'clearly excessive fee’ in violation of Canon 2, DR 2-106(A) of the Code of Professional Responsibility and Canons.
".2 The following is the schedule of reasonable fees referred to in subrule 928.1:
"(1) Not to exceed 40% of the first $5,000 recovered, not to exceed 35% on the next $20,000 recovered, not to exceed 25% on the next $225,000 recovered, not to exceed 20% on the next $250,000 recovered, and not to exceed 10% on any amount recovered over $500,000.
"(2) Alternatively, the attorney and client may agree to a contingent fee of one-third of the entire recovery that does not exceed $250,000 and 20% of the next $250,000, and not to exceed 10% of any amount recovered over $500,000.
".3 The percentages referred to in subrule 928.2 shall be computed on the net sum recovered after deducting from the amount recovered all disbursements properly chargeable to the enforcement of the claim or prosecution of the action. In computing the fee, the costs as taxed and any interest included in or upon the amount of a judgment, shall be deemed part of the amount recovered.
".4 An attorney may enter into contingent fee arrangements calling for lower percentages or for less compensation than that set forth by subrule 928.2.
".5 An attorney shall advise his client, before entering into a contingent fee arrangement, that attorneys may be employed under other fee arrangements whereby the attorney is compensated for the reasonable value of his services, such as on an hourly or per diem basis. The method of compensation utilized by any individual attorney remains the attorney’s option and this rule does not require any attorney to accept compensation in a manner other than he chooses.
".6 All contingent fee arrangements entered into by an attorney with his client shall be in writing and a copy thereof provided to the client.
".7 This rule does not apply to agreements reduced to writing before May 3, 1975.” (Added May 2, 1975.)
The attorney fees in these three cases do not have to comply with the guidelines of GCR 1963, 928, supra, since the rule does not apply to agreements reduced to writing before May 3, 1975.
We do not use the language "contingent future interest” in the traditional property law context. We use this language as a descriptive phrase characterizing the insurer’s future compensation credit.
The insurer’s future credit is still reduced on a weekly basis by the amount of compensation benefits the employee would have received but for the third-party recovery.
Thus, with employee Franges, the insurer’s future credit of $61,252.99 would be reduced on a weekly basis by $104, the weekly compensable wage loss and by any other claims compensable under the act.
Since the weekly reimbursement of recovery expenses by the insurer to the employee changes the redistribution dollar amounts each week, calculation of these amounts should be made by the respective trial courts. Any calculation by this Court would be inaccurate when the case reaches the trial court on remand. Additionally, the Schalk case record does not indicate the dollar amount of employee Schalk’s weekly compensation award. The lack of this information makes computation of step VII, apportionment of recovery expenses for future compensation credit, impossible. | [
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Ryan, J.
Michael Delgado was tried by a jury and convicted of delivery of a controlled substance, heroin, MCLA 335.341(l)(a); MSA 18.1070(41)(l)(a). His conviction was affirmed by the Court of Appeals in an unpublished per curiam opinion. We granted leave to appeal. 399 Mich 837 (1977).
The defendant’s conviction arose out of a course of continuing conduct in which he sold a quantity of heroin to one Vincent Mazzara, a City of Detroit undercover police officer. During the course of the dealing, Delgado delivered heroin to Mazzara on two occasions, January 17 and 22, 1974. The information filed in the instant case charged defendant only with delivery of heroin on January 22. In a separate information, defendant was charged with selling an ounce of heroin to Mazzara on January 17.
Before the trial concerning the January 22 sale, which is the matter before us, the defendant’s attorney moved to consolidate the two cases based upon considerations of expedience and collateral estoppel and, because, as he put it: "[it] is just one entire transaction, even though there are two different dates.” The trial judge denied the motion because she believed there were two separate transactions and no "compelling factual reason or legal reason to consolidate them for trial”. Testimony concerning the January 17 sale was admitted at defendant’s trial on the justification that it constituted a "similar act” within the meaning of MCLA 768.27; MSA 28.1050. On appeal defendant contests the admissibility of the "similar acts” testimony; he has not contested the denial of the motion to consolidate.
The people’s case is built primarily around the testimony of undercover officer Mazzara. Mazzara’s testimony begins with his introduction to defendant, Delgado. A mutual acquaintance, Herbert Schpre, arranged a meeting between Mazzara and defendant in consideration of a promise that if Mazzara purchased heroin from Delgado, Schpre would receive 10% of the purchase price. At this meeting, which occurred on January 15, defendant took the position that he would sell nothing less than a quarter kilo of heroin. As the buyer, Mazzara maintained that he would first like a sample of the heroin and explained that if he liked the sample he would then buy a quarter kilo. After much discussion defendant acceded to Mazzara’s terms and agreed to sell him a single ounce as a sample, as soon as the drug became available.
At the conclusion of Mazzara’s direct examination, the prosecutor sought to introduce a tape recording of a January 17 telephone conversation between the witness and the defendant. The defendant objected to the admission of the tape on the ground that the judge had earlier ruled that it was not part of the same transaction and that the probative value of the evidence was outweighed by its unduly prejudicial character so as to preclude its introduction under the "similar acts” statute. Overruling defendant’s challenge, the trial judge permitted the recording to be admitted under the statute.
After Mazzara testified that he had placed a telephone call at 1:30 a.m. on January 17 to defendant at the Ball Park Bar, which defendant owned, the prosecutor proceeded to play the recorded telephone conversation for the court and jury. In that conversation defendant told Mazzara to come to the bar, and Mazzara asserted that he had "got the cash and everything”.
Mazzara testified that he arrived at the bar at about 2 a.m. and that defendant took him to his car in the parking area where Mazzara purchased one ounce of very dark heroin from Mexico for $1600. Mazzara told defendant that if "his people” liked the sample, he would "get back with him to possibly purchase a quarter kilo”.
Mazzara’s testimony continued with his description of a meeting with defendant at the Ball Park Bar at about midnight on January 22. Mazzara told defendant he wanted to buy a quarter kilo of heroin and wanted to deal directly with defendant because Schpre’s percentage was too high. Defendant gave Mazzara his home phone number and told Mazzara to call him at home at around 3 a.m.
Mazzara made the 3 a.m. telephone call as instructed. A tape recording of that conversation was received as evidence without objection and played for the jury. In that conversation defendant said he had three ounces of the "same kind”, but stronger, at a price of "eighteen”. Mazzara agreed to meet defendant at defendant’s house.
Mazzara arrived at defendant’s house at about 3:30 a.m. on January 22. He purchased three ounces of dark brown Mexican heroin for $5400. Mazzara said if he liked the heroin he would call back within a day or two to buy a larger quantity.
After the close of the people’s proofs, defendant rested without presenting any evidence. In closing argument, defense counsel vigorously attacked Mazzara’s credibility and argued the existence of reasonable doubt.
I
The first issue involves the question of admissibility of evidence of defendant’s January 17 sale of heroin to Mazzara.
Defendant contends that the introduction of the evidence concerning the January 17 delivery of heroin tended to show that he was guilty of a separate and distinct criminal act. Accordingly, he asserts that the recorded conversation of January 17 and the testimony relative to the alleged purchase on the 17th should not have been admitted into evidence. We disagree.
It is the nature of things that an event often does not occur singly and independently, isolated from all others, but, instead, is connected with some antecedent event from which the fact or event in question follows as an effect from a cause. When such is the case and the antecedent event incidentally involves the commission of another crime, the principle that the jury is entitled to hear the "complete story” ordinarily supports the admission of such evidence. State v Villavicencio, 95 Ariz 199; 388 P2d 245 (1964); People v Wardwell, 167 Cal App 2d 560; 334 P2d 641 (1959); McCormick on Evidence (2d ed), § 190.
Stated differently:
"Evidence of other criminal acts is admissible when so blended or connected with the crime of which defendant is accused that proof of one incidentally involves the other or explains the circumstances of the crime.” State v Villavicencio, supra, at 201.
See also State v Page, 395 SW2d 146 (Mo, 1965); United States v McCartney, 264 F2d 629 (CA 7, 1959); Guajardo v State, 168 Tex Crim 503; 329 SW2d 878 (1959); State v Kuhnley, 74 Ariz 10; 242 P2d 843 (1952); 1 Wigmore, Evidence (3d ed), § 218; 1 Wharton’s Criminal Evidence (12th ed), § 284.
The foregoing principle is applicable to this case. An agreement for an initial sale of sample heroin and a subsequent sale of a larger quantity of heroin was reached at the January 15 meeting between Mazzara and defendant. Mazzara’s testimony concerning this meeting clearly delineated an anticipated course of dealing in which the sample purchase of heroin would be made as a condition precedent to a subsequent purchase of a greater quantity of the same, if the sample proved to be of adequate quality. Mazzara’s testimony to that effect was received without objection. When later in Mazzara’s testimony the defendant objected to admission of the telephone recording of the 17th, which concerned the negotiations for the sample purchase, the jury had already been made aware of the fact that there had been two separate but interrelated sales of heroin. In addition, the recorded telephone conversation of the 22nd setting up the sale to be made on that date, which was received without objection, made clear reference to the prior sale. In that conversation defendant said he had three ounces of the "same kind”, but "stronger” at a price of "eighteen”.
The defendant’s peculiar and inconsistent pattern of objection did not serve to insulate the jury from awareness of the fact that there had been a prior sale, but served only to keep from the jury the specific details of the course of dealing between the 15th and the 22nd and interrupted the continuity of the testimony relating to it.
As the recital of the facts discloses, the sale on the 17th and the sale on the 22nd were inextricably related, one to the other. Quite literally, the sale on the 22nd followed from the sale on the 17th, as does an effect follow from a cause. The jurors were entitled to have before them the facts concerning the sale of January 17 as an integral part of the events which were incidental to the January 22 sale.
In finding that the evidence was properly before the jury, we deem it unnecessary to decide whether the evidence was admissible under the "similar acts” statute and intimate no view with respect thereto.
II
Defendant next contends that the trial judge erred reversibly in failing to instruct that knowledge that the substance delivered was heroin is an element of the offense of delivery of a controlled substance.
We reject this claim of error. In People v Rios, 386 Mich 172; 191 NW2d 297 (1971), this Court looked to the statute prohibiting the unlawful sale of narcotics in order to determine the essential elements of that offense. The statutory provision at issue in Rios was the predecessor to the "deliv ery” statute at issue in this case. In Rios, after reviewing the former statute, this Court held that the elements of an unlawful sale of narcotics were: "(1) the lack of license; (2) sale of a prohibited narcotic drug; (3) to another identifiable person.” The former statute made no mention of knowledge of the character of the substance and this Court did not find knowledge to be an essential element of the offense. Similarly, the present statute prohibiting the unlawful delivery of a controlled substance makes no mention of knowledge. Accordingly, we cannot reasonably conclude that either the case law or the statute proscribing the delivery of heroin required the trial judge, at the time this case was tried, to instruct the jury that knowledge that the substance was heroin is a separate element of the offense of the delivery of a controlled substance.
Although neither the case law nor the statute mandates an instruction to the jury that knowledge is an essential element of the crime, better practice suggests that the instruction be given in "delivery” cases to guarantee fundamental criminal mens rea requirements. The knowledge in struction is essential, of course, in cases wherein there is reasonably raised in the evidence the issue of whether the defendant, particularly an aider and abettor, knows the nature of the substance which he is delivering.
The case before us, however, is not at all analogous to such instances. At trial, Delgado did not argue that as the alleged seller of the heroin he lacked knowledge that the substance involved was a narcotic, or that the people failed to prove his knowledge to that effect. Rather, the defendant’s tactic was to attack the general credibility of police agent Mazzara. The determinative factor in the case was the credibility of Mazzara in relating the events of the alleged transaction between himself and the defendant. Essentially, the defendant’s sole claim was that there was no transaction whatsoever between himself and Mazzara. Defendant did not request a specific instruction on knowledge nor did he object to the court’s failure to give a knowledge instruction.
We find no reversible error in the trial judge’s failure to give a knowledge instruction in this case.
Ill
Defendant’s final contention is that the prosecutor’s closing argument was improper in six instances. Although defendant’s objection to the first of those remarks was sustained, defendant made no objection at trial to the remaining five remarks he now argues were improper. Defendant did not request a cautionary instruction, and no instruc tion specifically directed toward the prosecutor’s argument was given. The trial judge did instruct generally that "the law, of course, does not permit jurors to be governed by sympathy, by prejudice or by public opinion”, that the jury was to "consider only the evidence in the case” and that attorneys’ "statements and arguments are not evidence”.
Where no objection to prosecutorial argument is made below, appellate review is precluded unless failure to consider the issue would result in a miscarriage of justice. People v Duncan, 402 Mich 1, 16; 260 NW2d 58 (1977) (opinion by Ryan, J.), and cases cited therein. While some of the remarks here might have been better left unsaid, the remarks were not "fatally prejudicial or entirely without provocation”. People v Allen, 351 Mich 535, 544; 88 NW2d 433 (1958).
Affirmed.
Kavanagh, C.J., and Levin, Coleman, Fitzgerald, and Blair Moody, Jr., JJ., concurred with Ryan, J.
In making the motion to consolidate, defendant’s attorney argued, "My thinking is that both cases were one, even though they arose at two separate times”. "[B]oth cases arose out of the exact same agreement, but just to make two different deliveries at different times.”
"Because prior to the alleged delivery on the 17th, there was discussion as to a continuing type thing. And it wasn’t like the rape case, you know, leaving and saying I will be back tomorrow night, be waiting for me. This was like an agreed upon arrangement at the time the alleged first agreement was made, or the alleged delivery was made. So, I believe that [it] is just one entire transaction, even though there are two different dates.”
The prosecutor states in his brief on appeal that the January 17, 1974 charge was dismissed on July 17, 1975.
"In any criminal case where the defendant’s motive, intent, the absence of, mistake or accident on his part, or the defendant’s scheme, plan or system in doing an act, is material, any like acts or other acts of the defendant which may tend to show his motive, intent, the absence of, mistake or accident on his part, or the defendant’s scheme, plan or system in doing the act, in question, may be proved, whether they are contemporaneous with or prior or subsequent thereto; notwithstanding that such proof may show or tend to show the commission of another or prior or subsequent crime by the defendant.” MCLA 768.27; MSA 28.1050.
The foregoing statute has since been superseded by MRE 404(b).
In addition to reading the pertinent statute and the information, the trial judge instructed on the elements of the offense:
"Now, in order to establish the defendant’s guilt to your satisfaction beyond a reasonable doubt, the people are required to establish certain elements which constitute the offense of delivery of heroin.
"First, the people must establish that the defendant, Michael Delgado, did in fact deliver to Vincent Mazzara heroin on or about the 22nd day of January, 1974. In that connection, delivery is defined in its ordinary term as a transfer of a thing, a substance or an article from one person to another.
"You must also be satisfied that the substance at issue here, people’s exhibit 4, is heroin. And, of course, you have heard the testimony of Mrs. Reynolds, who testified regarding the identification of the nature of the substance referred to as people’s exhibit 4.
"So, if you are convinced beyond a reasonable doubt that people’s exhibit 4 is heroin, and that on or about January 22, 1974, that Michael Delgado transferred or delivered that heroin to Vincent Mazzara through a sale, it would be your duty to return a verdict of guilty.
"On the other hand, if the evidence offers a reasonable doubt as to the guilt of the defendant, Michael Delgado, on those elements, it would be your duty to return a verdict of not guilty.”
"Any person not having a license under the provisions of Act No. 343 of the Public Acts of 1937, as amended, being sections 335.51 to 335.78, inclusive, of the Compiled Laws of 1948, who shall sell, manufacture, produce, administer, dispense or prescribe any narcotic drug shall be deemed guilty of a felony, and upon conviction thereof shall be punished by imprisonment in the state prison for a term of not less than 20 years nor more than life.” MCLA 335.152; MSA 18.1122.
The pertinent portion of MCLA 335.341(1); MSA 18.1070(41X1), reads:
"Except as authorized by this act, it is unlawful for any person to manufacture, deliver or possess with intent to manufacture or deliver, a controlled substance.”
"Deliver” is defined by MCLA 335.304; MSA 18.1070(4) as:
" 'Deliver’ or 'delivery’ means the actual, constructive or attempted transfer from 1 person to another of a controlled substance, whether or not there is an agency relationship.”
Proposed CJI 12:2:03 requires that the defendant have transferred a substance, "knowing that the substance was /list substance] and intending to so deliver it to another person”. The committee commentary acknowledges that neither the definition of delivery nor the provision proscribing delivery uses the terms "knowledge” or "knowing”. Notwithstanding this fact, the committee decided, after considerable debate, to adopt the instruction in view of the differing penalties for various substances under the Controlled Substances Act and because of the problem of the innocent carrier. 2 Michigan Criminal Jury Instructions (Ann Arbor: Institute of Continuing Legal Education), p 12-30. | [
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Kavanagh, C.J.
(to affirm). Defendant employed plaintiff as an elevator mechanic from 1967 until December of 1974, when plaintiff was transferred from the maintenance section to the service section because, according to plaintiff’s complaint, "defendant company wanted to make room for younger men with less seniority”. Defendant admitted the transfer but denied the reason ascribed.
On December 6, 1974, plaintiff was informed that there was no work, and laid off, although the complaint states that he continued to work a few days each month following the layoff.
Plaintiff filed a charge of age discrimination with the Michigan Civil Rights Commission on June 9, 1975, approximately 184 days after the layoff. On March 11, 1976, the commission dismissed the complaint because it was not filed within the 90 days required by § 7(b) of the Michigan State Fair Employment Practices Act (FEPA).
Subsequently, on April 9, 1976, plaintiff filed a complaint in Wayne Circuit Court against defendant alleging that age discrimination motivated plaintiff’s transfer and layoff. Claiming that the administrative remedy contained in the FEPA was plaintiff’s exclusive remedy for age discrimination in private employment, defendant-employer filed a motion to quash service of process and for accelerated judgment of dismissal. The trial judge, reasoning that material distinctions in law exist between racial and age discrimination, declined to extend our holding in Pompey v General Motors Corp, 385 Mich 537; 189 NW2d 243 (1971), in which this Court held that a black plaintiff who had not filed a timely complaint with the Michigan Civil Rights Commission was not precluded from maintaining a civil suit against his employer. The trial court entered a judgment of dismissal with prejudice on July 28, 1976. The Court of Appeals reversed, finding that Pompey was equally applicable to age discrimination. 75 Mich App 198; 255 NW2d 6 (1977).
We affirm. In Pompey, supra, we acknowledged that plaintiff’s complaint to the Civil Rights Commission was properly dismissed as being untimely filed. We noted, however, that plaintiff in his complaint did not assert entitlement to the statutory remedy provided in the FEPA, but rather asserted his right to a cumulative judicial remedy for redress of his civil right to be free from discrimination in private employment. We held that such a cumulative judicial remedy could be main tained in addition to the remedial machinery provided by the statute for vindication of the statutorily created right to be free from discrimination in private employment.
While we recognized that there had been no common-law remedy for race discrimination in private employment and that the absence of such a remedy was ordinarily significant in determining the exclusiveness of the statutory remedy, we nevertheless forged an exception. Looking to prior Michigan case law we found support in civil rights cases for an exception to the general rule that where a new right is created or a duty is imposed by statute, the statutory remedy provided for enforcement is exclusive. In Pompey we continued the exception to that rule. We additionally predicated our decision upon our conviction that the constitutional delegates did not intend, in creating the Civil Rights Commission, to vest it with exclusive jurisdiction over civil rights cases.
There is nothing in our decision in Pompey which suggests that the holding is to be limited to the securing of one’s civil right to be free from racial discrimination in private employment. The legislation which proscribed such racial discrimination, also proscribed discrimination on the basis of age, sex, color, religion, national origin or ancestry. MCL 423.301 et seq.; MSA 17.458(1) et seq. There is no reason to conclude that the Legislature, in drafting the FEPA, now part of the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101), et seq., intended that distinctive treatment be accorded violation of the specific civil right to be free from racial discrimination as opposed to violation of any of the other statutorily protected civil rights. The right to be free from racial discrimination and the right to be free from age discrimination in private employment are both statutory civil rights created by the FEPA and continued in Civil Rights Act.
Pompey does not permit, and we do not perceive, a basis that prompts us to accord age discrimination lesser treatment. Therefore, our decision to extend a cumulative judicial remedy to Pompey for racial discrimination in private employment must likewise be extended to the age discrimination complainant in the instant case.
Accordingly we affirm the Court of Appeals and remand to the circuit court for a hearing on the merits. No costs, a public question involved.
Williams, Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred with Kavanagh, C.J.
MCLA 423.307(b); MSA 17.458(7)(b).
Another panel of the Court of Appeals reached a similar conclusion in Hernden v Consumers Power Co, 72 Mich App 349; 249 NW2d 419 (1976).
Pompey v General Motors Corp, 385 Mich 537, 558-559, fn 19; 189 NW2d 243 (1971).
Also persuasive in arriving at a determination in the instant matter that an aggrieved party may pursue a cumulative judicial remedy for the violation of any civil right is the fact that the FEPA, reenacted in the Civil Rights Act, MCLA 37.2101 et seq.; MSA 3.548(101) et seq., now expressly provides for direct access to the circuit court. MCLA 37.2801; MSA 3.548(801). | [
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Levin, J.
It has not been determined whether Bobby V. Williams was an employee of Hansell Lang, doing business as Lang’s Gulf Service, and therefore we cannot reach the question on which leave to appeal was granted of whether Gulf Oil Company or Bole Oil Company, a Gulf distributor, is a statutory employer obliged to pay compensation because of their relationship with Lang who was not insured and had not otherwise complied with the workers’ compensation act.
We do not read the opinion or order of the Worker’s Compensation Appeal Board as a finding or determination that there was insufficient evidence that Williams was an employee of Lang. Rather, it left that issue undecided. We remand to the WCAB for a finding on that issue, retaining jurisdiction.
Williams was severely injured while working out of Lang’s service station. He claimed that he was employed by Lang, who had disappeared and was not available to give testimony, and that Bole and Gulf were statutory employers required to pay him compensation because, while he was so employed by Lang, he was engaged in the execution of work for one or both contracted out by them to Lang. Alternatively, he claimed he was employed by D. C. Gregory of Dewey’s Automatic Transmission.
The referee and WCAB view of the facts and case law was that Bole and Gulf were not statutory employers. They also concluded that there was insufficient evidence that Dewey’s Automatic Transmission, individually or in partnership with Lang, had employed Williams.
While the referee found that the testimony of Williams’ wife did not "fill the void” and that he could not "determine the relationship between Lang and” Williams, the WCAB did not in terms adopt that finding. The statements in the control ling WCAB opinion that "there is insufficient evidence from which to draw reasonable inferences” and that the "evidence before us is insufficient for the drawing of even reasonable inferences much less is it sufficient for such findings [emphasis supplied]” are in the context of whether Dewey’s was responsible as an employer, not whether Lang was so responsible.
In a word, while the WCAB adopted the referee’s conclusions that the cause should be dismissed as to Bole and Gulf with prejudice and as to Lang and Dewey’s without prejudice, it does not appear to have adopted the referee’s finding that the relationship between Lang and Williams could not be determined.
The controlling WCAB opinion made no refer ence whatsoever to any of the evidence concerning the relationship between Williams and Lang. It, therefore, does not appear that the WCAB considered the evidence bearing on their relationship or made any determination as to its sufficiency or a finding in that regard.
The WCAB’s failure to find whether Williams was an employee of Lang is understandable in light of its conclusion that Bole and Gulf were not responsible as statutory employers. Having so concluded and Lang being uninsured and absent, the WCAB apparently saw no need to go on to decide whether Williams was an employee of Lang. We often similarly avoid decision regarding questions, factual and legal, that no longer appear pertinent to the dispute.
The minority, two of the five sitting members of the WCAB, indicated that they were inclined to find that Williams was employed by Lang. The testimony of Williams’ wife as well as of the amnesiac Williams lends support to such a finding. Also, there is some corroborative testimony of other witnesses.
We granted leave to appeal to consider whether Bole or Gulf, or both, are statutory employers, i.e., whether Lang, who sold Gulf products under the name "Gulf’, had contracted "for the execution” "of the whole or any part of any work undertaken by” Bole or Gulf so that one or both are liable to Williams as a person "employed in the execution of the work”. Our grant of leave indicates that we may take a view of the law different than reflected in the decision of the WCAB. Therefore, Bole or Gulf may be statutory employers liable to pay compensation to Williams if it were determined that Lang had employed him.
Since the question whether Williams is an employee of Lang may be determinative, and there is evidence from which the WCAB could find that he was, and it does not appear that the WCAB decided that the evidence is insufficient to support such a determination, we vacate the order of the WCAB and remand to it for further findings, retaining jurisdiction.
Kavanagh, C.J., and Williams and Blair Moody, Jr., JJ., concurred with Levin, J.
1948 CL 411.10; now MCL 418.171; MSA 17.237(171).
The referee had further found that Williams "by reason of his injury, has lost his memory of events preceding the injury. The wife’s testimony does not fill the void. There is no way that I can determine the relationship between Lang and the plaintiff”.
The referee indicated that while Dewey had testified, he was not wholly satisfied. "The only persons who could rebut his testimony are Lang and [Williams], We can’t excuse Lang but [Williams] is the one who would be prejudiced by final action.”
The referee decided that the appropriate course of action was to dismiss the cause against Bole and Gulf on the ground that they were not responsible as statutory employers, but to qualify the dismissals as to Lang and Dewey’s as without prejudice, thereby it appears, seeking to preserve to Williams an opportunity to reassert claims against them should he obtain further evidence. The WCAB agreed with that assessment.
The referee’s finding was quoted by the WCAB, but in terms and context that was a recital of the background, not a decision on the merits. The affirmance of the referee’s result and decision does not constitute an adoption of his findings. In the instant case two of the five members indicated that while they were not prepared to find that Williams was an employee of Lang, they were inclined on the evidence at hand to so conclude. The majority did not advert at all to what could prove to be the critical factual issue.
The controlling WCAB opinion stated:
"I respectfully submit that 'at most’ much more could be found than that 'plaintiff may have been the employee of Hansell Lang’. The referee, with sufficient evidence before him, made a determination that neither Gulf nor Bole have any responsibility to plaintiff. I agree with this determination and would affirm it. However, with an amnesic plaintiff, a missing defendant who happens to be a material witness, and a material witness who is also a defendant but whose testimony is totally self-contradictory (Member Oldstrom calls it 'not unsurprisingly vague’ yet bases crucial findings upon it [see testimony recorded on page 8 of the transcript of Mr. Gregory’s deposition taken February 9, 1972, and his testimony recorded on pages 228-29 of the transcript of the September 19, 1972, hearing]). We are confronted not only with that which I in confidence call a unique situation but we are also in a situation in which there is insufficient evidence from which to draw reasonable inferences.”
"In the instant case, such an assumption would be contra the express words of the referee, words other than 'without prejudice’ by which he has conveyed his intent to determine only the liability of Gulf and Bole. In my opinion we too should clearly circumscribe the area to which our determination is confined. Other than consideration of the evidence relating to plaintiff’s claims against Gulf and Bole, I have made no additional evaluation except to satisfy myself of the insufficiency of evidence from which to draw reasonable inferences. As I would not make a determination that Dewey’s Automatic Transmission did not employ plaintiff, as Member Oldstrom has determined, so I would not make a determination that Dewey’s Automatic Transmission did employe plaintiff, as Gulf urges at appeal. The evidence before us is insufficient for the drawing of even reasonable inferences much less is it sufficient for such findings.”
See fn 2, supra.
The troublesome question for the WCAB was whether Dewey’s, apparently insured, was Williams employer. The difference between the majority and minority of the WCAB concerned the treatment of the case against Dewey’s, not the case against the absent and uninsured Lang. Both the majority and minority opinions adverted to the evidence concerning the relationship with Dewey’s. The majority made its own explicit finding, implicit m the referee’s findings, that the record was insufficient to permit a finding that Dewey’s was an employer of Williams.
The minority opinion states:
“What slight evidence there is tends to indicate that plaintiff was an employee of Lang who handled all business affairs at the station, including making weekly payments of wages to plaintiff. Note should be made of the fact that Lang also hired somebody to help plaintiff in the transmission end as Robert Lang testified. Apparently, Hansell Lang even made deductions from plaintiff’s pay based upon the rates of deduction at Aamco Transmission when he worked for Aamco as an employee. Further, at one point during the summer, plaintiff quit the Lang operation for three weeks and then returned. This type of behavior is reasonably to be expected from employees and not from partners. From the evidence, we conclude that the relationship of master-servant existed between Lang and plaintiff for the reasons that Lang seems to have been responsible for the selection of plaintiff, he paid plaintiff wages, retained the power to dismiss the plaintiff (which is inferred from plaintiff’s termination of employment with Lang in the summer and Lang’s hiring of a person to help plaintiff) and controlled plaintiffs conduct which appears from Lang’s involvement with Pierce in negotiating the contract for the transmission repair with him. 53 Am Jur 2d, Master and Servant, § 1.”
"In summary, we conclude as follows: Plaintiff has been injured and is without remedy under the act until Lang can be found. Lang and plaintiff were not partners in the transmission business and neither Bole, Gulf, nor D. C. Gregory (Dewey’s Automatic Transmission) were actual or statutory employers of plaintiff under MCL 411.10; MSA 17.150. At most, plaintiff may have been the employee of Hansell Lang. However, such determination must await further proceedings once Lang is found. Likewise, the question of whether Lang was subject to the act must await further proceedings upon his appearance.” | [
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Per Curiam.
The issue is whether defendant’s acquittal of a charge of public intoxication bars, under the "same transaction” rule we adopted in People v White, 390 Mich 245, 258; 212 NW2d 222 (1973), a charge of resisting arrest arising out of the events which led to the charge of public intoxication.
We hold that prosecution is not barred because the two offenses involve laws intended to prevent substantially different harm or evil.
I
The police arrived at a tavern on March 31, 1974 after receiving a report of a disturbance from the owner. They saw a number of persons causing trouble and asked them to leave. As these persons were complying with the officers’ request, they received information that the defendant and a companion were causing a disturbance. The officers asked the companion to leave. The defendant intervened.
An officer testified at the preliminary examination that after an exchange of words, defendant was arrested, that he resisted the arrest and was subdued. Defendant was charged with an ordinance violation (public intoxication), and with a circuit-court misdemeanor (resisting a police officer in the discharge of his duty).
On August 13, 1974 the defendant was acquitted in the district court of the public intoxication charge. The circuit court concluded that the trial in district court barred prosecution for resisting arrest. The Court of Appeals affirmed. 66 Mich App 548; 239 NW2d 658 (1976).
II
The offenses in White all involved an element of criminal intent. In Crampton v 54-A District Judge, 397 Mich 489, 499, 502; 245 NW2d 28 (1976), we held that the criterion applied in White was inappropriate to a determination of whether a series of offenses arose out of the same transaction where at least one of those offenses did not involve an element of criminal intent. We developed the following criterion for such a situation:
"Where one or more of the offenses does not involve criminal intent, the criterion is whether the offenses are part of the same criminal episode, and whether the offenses involve laws intended to prevent the same or similar harm or evil, not a substantially different, or a very different kind of, harm or evil.”
Public intoxication does not involve an element of criminal intent.
The people argue that the offenses were not "part of the same criminal episode” because the defendant’s public intoxication existed before the police arrived at the scene. Whether or not public intoxication and resisting arrest can be part of the same criminal episode, we are persuaded that the two laws are intended to prevent substantially different harm or evil.
The purpose of the public intoxication ordinance, as is the purpose of the law proscribing the driving under the influence of liquor offense involved in Crampton, was to protect the public, as it went about its business, from persons not in control of themselves. The purpose of the resisting arrest statute is to protect persons (the officers) from physical violence and harm.
The enactment of 1977 PA 110; MCL' 325.763; MSA 18.1031(63) barring, after January 15, 1978, local ordinances imposing "a civil or criminal penalty for public intoxication, being a common drunkard, or being incapacitated” except as provided by MCL 750.167; MSA 28.364, as amended by 1977 PA 109, defining as "a disorderly person”, among others, "[a] person who is intoxicated in a public place and who is either endangering directly the safety of another person or of property or is acting in a manner that causes a public disturbance”, reflects the legislative judgment that public intoxication is so substantially different from conduct generally covered by the criminal law that it should not be a criminal offense at all.
We reverse the judgment of the Court of Ap peals and remand the matter to the circuit court for further proceedings consistent with this opinion.
Kavanagh, C.J., and Williams, Levin, and Ryan, JJ., concurred.
MCL 750.479; MSA 28.747.
We found that the three crimes committed by the defendant were all part of a single criminal transaction because they "were committed in a continuous time sequence and display a single intent and goal”. People v White, 390 Mich 245, 259; 212 NW2d 222 (1973).
It may also have an aesthetic purpose. See Morris & Hawkins, The Honest Politician’s Guide to Crime Control (University of Chicago Press, 1970), p 7. | [
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Levin, J.
An Illinois corporation committed a tortious act in Michigan and its insurer refused to defend against an action brought by Michigan residents or to satisfy a judgment.
This is an action by the Michigan residents against an Illinois insurance agent for negligence (errors and omissions) in procuring insurance for the corporation. The issue is whether, under the long-arm statute, a Michigan court may exercise limited personal jurisdiction over the insurance agent on the ground that, as a consequence of his negligence, the corporation was uninsured for its tortious act and the Michigan residents are unable to collect the judgment entered by a Michigan court in Michigan or elsewhere.
We conclude that there were less than the "minimum contacts” required with Michigan to satisfy Federal constitutional requirements, and that Michigan cannot exercise jurisdiction over him.
I
Khalaf was injured while operating a press in Michigan. He and his wife commenced an action in the Wayne Circuit Court against National Machine Servicing Company, Inc., an Illinois corporation, for negligence and breach of implied warranty in servicing the press. National’s insurer, Bankers & Shippers Insurance Company, refused to defend, claiming that the policy issued to National did not cover the operations which resulted in Khalafs injury. The circuit judge entered an order permitting counsel retained by Bankers, who had previously entered an appearance for National, to withdraw as its counsel of record. A $250,000 default judgment was subsequently entered against National and remains unsatisfied.
The Khalafs commenced this action in the Wayne Circuit Court against Bankers for reformation, breach of contract, and negligence, and against James Dullard, the Illinois insurance agent who had procured the insurance for National from Bankers, alleging negligence in such procurement.
An order was entered granting Dullard’s motion to quash service of process on the ground that the court did not have limited personal jurisdiction over him. The Court of Appeals affirmed.
There are, broadly stated, three issues:
1) Does the Khalafs’ complaint state a claim for relief, an issue of substantive law?
2) Did Dullard’s acts create a relationship to Michigan within the meaning of the long-arm statute, an issue of statutory construction?
3) Would exercise of jurisdiction be compatible with the concepts of fundamental fairness embodied in the Due Process Clause, an issue of Federal constitutional law?
We do not consider the issues of substantive law and statutory construction because we conclude that the record does not establish that Dullard’s relationship with Michigan was such as to make exercise of jurisdiction over him reasonable under the Due Process Clause.
II
Although we reject the Khalafs’ long-arm theory on due-process grounds, and thus there is no need to decide whether their substantive theory is correct, we nevertheless state it because their long-arm theory builds on their substantive theory.
Their substantive theory is that an insurance agent is subject to liability in an "action for tort” to an unpaid judgment creditor for negligent failure to procure insurance which would have provided a source of recovery. Dullard, by reason of his contractual relationship with National, owed a duty to exercise due care in the performance of the contract and, as an alternative to an action for breach of contract, an action may be maintained in tort for negligent performance of that duty. The acts committed by National which caused the Khalafs’ loss are within the ambit of the coverage which Dullard agreed to procure for National and, had the agreed-upon insurance been procured, the Khalafs could have looked to it as a source of recovery. They were third-party beneficiaries of the Dullard-National contract, and Dullard owed them a duty to perform the contract with due care.
The Khalafs on that basis assert that Dullard did or caused an act to be done or "consequences to occur” in Michigan which gave rise to an "action for tort”, and therefore the court may exercise long-arm jurisdiction pursuant to clause (2) of the statute:
"The existence of any of the following relationships between an individual or his agent and the state shall constitute a sufficient basis of jurisdiction to enable a court of record of this state to exercise limited personal jurisdiction over the individual and to enable the court to render personal judgments against the individual or his representative arising out of an act which creates any of the following relationships:
"(2) The doing or causing an act to be done, or consequences to occur, in the state resulting in an action for tort.” MCL 600.705; MSA 27A.705.
The consequence alleged to have occurred in Mich igan is that they (Michigan residents) are unable to collect in Michigan or elsewhere the Michigan judgment which they obtained against National. Dullard in Illinois caused that consequence by entering into a contract to procure insurance for National and by negligently performing that contract. The negligent performance provides a basis for maintaining an action for tort.
The Khalafs assert that exercise of jurisdiction by Michigan would be consistent with the "minimum contacts”, "traditional notions of fair play and substantial justice” standard declared under the Due Process Clause by the United States Supreme Court. 6 Dullard was aware that National had transacted business in at least one state (Wisconsin) other than Illinois before National serviced the press in Michigan. By agreeing to procure and by procuring insurance for a business whose operations he knew extended beyond Illinois, Dullard was involved in the stream of commerce. His deposition indicated that he may have thought the coverage provided by Bankers covered the Khalafs’ loss. He should have foreseen that negligent performance of his contract with National could cause loss to a Michigan resident. Michigan has an interest in providing effective means of redress for its residents who would be at a severe disadvantage if required to maintain their action for negligence in procuring insurance in a distant forum. It is therefore fair and reasonable to require Dullard to respond in Michigan.
Dullard counters that the Khalafs’ action sounds in contract and therefore is not an "action for tort”. The noncollectibility of a judgment is not a "consequence” occurring in this state. A relation ship with Michigan such as is required by Federal standards was not established: His agreement to procure insurance covering operations beyond Illinois was not a "purposeful availment” of the privilege of conducting activities within Michigan such as to render him subject to its process; he could not expect to be plucked from his Chicago office and dropped into the Wayne Circuit Court.
It is unnecessary to decide the statutory issues of whether an action for negligence which sounds in contract is an "action for tort” or whether the noncollectibility of a judgment is a "consequence” occurring in this state.
Proof alone that a nonresident caused an effect in Michigan that was foreseeable does not establish a relationship to Michigan such as to make it fair and reasonable to subject the nonresident to jurisdiction. A nonresident insurance agent is not subject to long-arm jurisdiction in an action for negligent procurement of insurance solely on evidence that i) he knows the insured may engage in activities outside the state in which the insured’s activities are generally centered and the agreement to procure insurance was made and ii) he agreed to procure insurance which covered those activities.
Ill
The United States Supreme Court declared in International Shoe Co v Washington that, in the context of long-arm jurisdiction, the question under the Due Process Clause is whether the defendant has such "minimum contacts” with the forum that maintenance of the action "does not offend 'traditional notions of fair play and substantial justice’ ”. This has remained the governing standard in the Court’s subsequent pronouncements.
The Court has held that jurisdiction may be maintained in respect to a single act having "substantial connection” with the state. It may also be exercised over causes of action arising "from activities entirely distinct” from the defendant’s activities in the forum where the nonresident has an adequate relationship with the state. "[G]eneral fairness to the [defendant] * * * [the] amount and kind of activities * * * mak[ing] it reasonable and just to subject the [defendant] to the jurisdiction of that state are to be determined in each case”.
A factor in the analysis is the state’s interest in providing "effective means of redress for its residents”.
It is not enough, however, that the forum state is "the 'center of gravity’ of the controversy, or the most convenient location for litigation. The issue is personal jurisdiction, not choice of law. It is resolved in this case by considering the acts of the [defendant]”. Merely because "a State’s law can properly be applied to a dispute, its courts [do not] necessarily have jurisdiction over the parties to that dispute”.
It is "essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws”. (Emphasis supplied.) The defendant’s activities will ordinarily be such that he will have "reason to expect to be haled before” the forum court.
Justice Blackmun, as a circuit judge, observed:
"We also think it is fair to say that these five Supreme Court cases establish only general and not precise guidelines. Perhaps they purposely do no more than this. We observe, however, that, at one time or another in the opinions, three primary factors, namely, the quantity of the contacts, the nature and quality of the contacts, and the source and connection of the cause of action with those contacts, are stressed, and that two others, interest of the forum state and convenience, receive mention.” (Emphasis supplied.)
Jurisdiction based on causing "effects” in another state was considered by the Court in a recent case, Kulko v Superior Court of California in & for the City & County of San Francisco. An all-encompassing California statute permits courts of that state to "exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United States”. The California Supreme Court held that the defendant had caused an "effect” in California by allowing one of his children, for whom he was paying a support allowance pursuant to a New York separation agreement and a divorce, to join her mother in California.
The United States Supreme Court said that the "effects” test was derived from 1 Restatement Conflicts, 2d, § 37:
"A state has power to exercise judicial jurisdiction over an individual who causes effects in the state by an act done elsewhere with respect to any cause of action arising from these effects unless the nature of the effects and of the individual’s relationship to the state make the exercise of such jurisdiction unreasonable.”
"[TJhis section was intended to reach wrongful activity outside of the State causing injury within the State * * * (shooting bullet from one State into another), or commercial activity affecting state residents” but, even in such situations, "the Restatement recognizes that there might be circumstances that would render 'unreasonable’ the assertion of jurisdiction over the nonresident defendant”.
The Court concluded that the father had not purposefully availed himself of the privilege of conducting activity in California. While California had a substantial interest in protecting the welfare of a minor resident, that alone would not make California a fair forum. The defendant father derived no "personal or commercial benefit from his child’s presence in California”. "[Sjending a child to California to live with her mother is not a commercial act and connotes no intent to obtain nor expectancy of receiving a corresponding ben efit in the State that would make fair the assertion of that State’s judicial jurisdiction”.
IV
The Khalafs contend that the Federal constitutional standard is satisfied by Dullard’s involvement in the stream of commerce, his agreement to procure insurance covering National’s business activities in Michigan and the reasonably foreseeable loss caused a Michigan resident by his negligent failure to do so.
It is not claimed that Dullard’s negligence was committed with the intention of causing effects in Michigan but, rather, that his acts could reasonably have been expected to do so. In such a case the Restatement suggests the following analysis:
"The act may not have been done with the intention of causing effects in the state but could reasonably have been expected to do so. Whether the state may exercise judicial jurisdiction in such a situation depends upon a variety of factors, including the extent of the relationship of the state to the defendant and to the plaintiff, the nature and quality of the effects resulting from the act, and the degree of inconvenience which would result to the defendant from being forced to stand suit in the state on the particular cause of action.” 1 Restatement Conflicts, 2d, § 37 (emphasis supplied).
Dullard was an insurance agent in Illinois. There is no evidence that he transacted business in Michigan at any time, nor evidence that he ever procured insurance for persons or property in Michigan or covering risks of loss extant in Michigan at the time the policy was written. Nor is there any evidence that his customer, National, apart from the activities that occasioned the Khalafs’ loss, ever did business in Michigan.
The only evidence indicating that Dullard knew that National did business outside Illinois is a certificate of insurance which he furnished to a Wisconsin company showing that National had been covered by Bankers under a comprehensive general liability policy. The certificate was furnished a few months after the date of the agreement to procure insurance relied on by the Khalafs and after Bankers issued its policy. Dullard indicated that he may have thought that the policy issued by Bankers covered the type of claim asserted by the Khalafs.
The evidence thus tends to show that Dullard did procure insurance for risks of loss outside Illinois, was to that extent involved in the stream of interstate commerce, had agreed with National to procure insurance covering risks of loss of the kind represented by the Khalafs’ claim, had reason to believe that National might do business at some indeterminate future time in some other state, possibly Michigan, and should reasonably have foreseen that negligent performance of his agreement with National could cause loss to a Michigan resident.
Policies of insurance generally provide coverage beyond the jurisdiction in which the insured’s activities are centered. Just as passenger automobile and homeowner liability policies protect a person when he travels beyond the boundaries of his state of residence, policies covering those engaged in commercial or industrial enterprises may provide such extended territorial coverage. The policy issued by Bankers to National may have so provided. Such extended territorial coverage may be and frequently is provided without focus on or identification of any particular out-of-state activity of the insured and without additional or identified premium charge at the time the policy is written.
To hold that because of such extended territorial coverage an insurance agent has caused a foreseeable effect wherever the insured may travel justifying the exercise of long-arm jurisdiction would be to subject insurance agents, however small and localized their operations, to the jurisdiction of any state to which an insured might travel.
Michigan is properly concerned with providing effective means of redress for its residents. The Khalafs, however, would have no need to transport witnesses from Michigan to Illinois to maintain an action against Dullard for negligence in procuring insurance. The witnesses are more likely to be located in Illinois.
The "quality and nature” of the effect in Michigan, inability to collect a judgment, do not pose the risk of physical harm presented by driving an automobile or distributing manufactured products in this state.
Foreseeable effects are a factor in the analysis, but an essential consideration is whether the defendant has "purposefully availed” himself of the privilege of conducting his activities in Michigan.
A "purposeful availment” is something akin either to a deliberate undertaking to do or cause an act or thing to be done in Michigan or conduct which can be properly regarded as a prime generating cause of the effects resulting in Michigan, something more than a passive availment of Mich igan opportunities. The defendant will have reason to foresee being "haled before” a Michigan court.
The effect on the injured person (third party beneficiary) may be the same whether it is the insurer who fails to perform a contract of insurance or the insurance agent who fails to perform a contract to procure insurance. There is, nevertheless, a significant difference between an insurer’s obligation and an insurance agent’s obligation in terms of the nature of defendant’s business and defendant’s purposeful availment of the privilege of conducting activities within Michigan.
Since insurers generally seek to sell their services in new territories including other states, and depend on out-of-state business to generate volume, it is ordinarily fair to conclude that their involvement in commercial activity respecting a state is a direct result of a purpose to expand their business.
Insurance agents, on the other hand, do not generally seek to expand their business into other states. They will, nevertheless, find themselves writing insurance for risks in other states as a result of the expansion of their customers’ businesses. They become involved in another state, not because of their own purpose to do so, but because of their customers’ purpose.
An insurer agrees to defend the insured in the forum, an insurance agent generally does not undertake to do anything in the forum. There is a substantial difference between agreeing, as does an insurance agent, to procure someone who will act in Michigan and agreeing, as does an insurer, to act in Michigan. The effect of nonperformance may, indeed, be consequences in Michigan affect ing in the same way the insured or an injured person, but foreseeable effects alone are not purposeful availment.
The Supreme Court of Hawaii held that a Virginia physician was not subject to long-arm jurisdiction in Hawaii for negligence in prescribing medication in Virginia claimed to have resulted in the patient’s loss of consciousness while driving an automobile in Hawaii which struck plaintiffs automobile:
"The case before us is not one involving a defendant who introduces a defective product into the stream of commerce. Neither is it one involving an intentional tort, nor one where the act was performed for the purpose of causing an effect in Hawaii. Here there was only a chance encounter between a Hawaii resident visiting in Virginia and a physician who was engaged in a strictly localized medical practice.
"We hold that under the circumstances of this case, the assertion of jurisdiction over the defendant Virginia physician would be violative of his rights under the Due Process Clause of the United States Constitution. Ordinary foreseeability principles of tort law are helpful but not determinative, for we are here concerned with constitutional principles of due process. Mere foreseeability of injury was not sufficient to establish the minimum contact necessary to satisfy the requirements of due process.”
If causing foreseeable effects alone constituted purposeful availment, a roadside "Ma & Pa” sandwich shop in Toledo, Ohio would be subject to long-arm jurisdiction although the adverse physical effects of a tainted sandwich, consumed there or across the border in Monroe, Michigan, manifested themselves or persisted in Detroit or in the Upper Peninsula. It is clearly foreseeable that a person who buys a sandwich at a roadside shop in Toledo might travel to Michigan and that a negligently made sandwich might cause consequences beyond Ohio.
If causing foreseeable effects alone constituted purposeful availment, a Chicago grocery store supplying consumables, a haberdashery or boutique providing clothing, or a marina purveying boat supplies, to a person known to have a Michigan cottage, or a physician performing cosmetic surgery on him, could be subject to Michigan long-arm jurisdiction. In each instance the Chicago provider knows that the product or service is for use in Michigan, and that negligent performance will cause effects in Michigan. The enterprise is commercial, affecting the stream of commerce. But the nature of the provider’s business is nevertheless so clearly localized that proof of transactions with Michigan residents should not alone subject the provider to long-arm jurisdiction. The generat ing cause is not the provider’s desire to enlarge his business into Michigan but, rather, the Michigan customer’s desire to do business with the Chicago provider.
A localized business — sandwich shop, grocer, haberdashery, boutique, marina, physician, or insurance agent — does not depend on multi-state distribution to generate volume. Out-of-state effects are but an incident of the business.
A different question might be presented on evidence that the insurance agent agreed to insure specific risks in the forum state or that he transacted substantial business for insureds located in the state. It might then appear that because of the nature, quality and quantity of such an insurance agent’s business he had purposefully availed himself of the privilege of conducting activity in Michigan and that Michigan was a "fair forum”. Such evidence is altogether lacking in this case.
On this record, Michigan is not, in our judgment, a fair forum. It would not be "reasonable, in the context of our federal system of government, to require” Dullard to defend the Khalafs’ claims in Michigan.
Affirmed, costs to appellee.
Coleman, Fitzgerald, and Ryan, JJ., concurred with Levin, J.
"The existence of any of the following relationships between an individual or his agent and the state shall constitute a sufficient basis of jurisdiction to enable a court of record of this state to exercise limited personal jurisdiction over the individual and to enable the court to render personal judgments against the individual or his representative arising out of an act which creates any of the following relationships:
"(1) The transaction of any business within the state.
"(2) The doing or causing an act to be done, or consequences to occur, in the state resulting in an action for tort.
“(3) The ownership, use, or possession of real or tangible personal property situated within the state.
"(4) Contracting to insure a person, property, or risk located within this state at the time of contracting.
"(5) Entering into a contract for services to be rendered or for materials to be furnished in the state by the defendant.
"(6) Acting as a director, manager, trustee, or other officer of a corporation incorporated under the laws of, or having its principal place of business within this state.
"(7) Maintaining a domicile in this state while subject to a marital or family relationship which is the basis of the claim for divorce, alimony, separate maintenance, property settlement, child support, or child custody.” MCL 600.705; MSA 27A.705, as amended by 1974 PA 90.
The 1974 amendments, effective April 1, 1975 (subsequent to the events which gave rise to the Khalafs’ claims), amended the opening clause to substitute "an act” for "the act or acts”, revised clauses (2) through (6), and added clause (7).
"(1) A state has power to exercise judicial jurisdiction over a person if the person’s relationship to the state is such as to make the exercise of such jurisdiction reasonable.
“(2) The relationships which are sufficient to support an exercise of judicial jurisdiction over a person are stated in §§ 27-52.” 1 Restatement Conflicts, 2d, § 24.
See Williams v Polgar, 391 Mich 6, 22; 215 NW2d 149 (1974); Clark v Dalman, 379 Mich 251, 261; 150 NW2d 755 (1967); Nash v Sears, Roebuck & Co, 383 Mich 136, 143; 174 NW2d 818 (1970).
See Williams v Polgar, supra; Clark v Dalman, supra; and Nash v Sears, Roebuck & Co, supra.
International Shoe Co v Washington, 326 US 310, 316; 66 S Ct 154; 90 L Ed 95; 161 ALR 1057 (1945).
See Hanson v Denckla, 357 US 235, 253; 78 S Ct 1228; 2 L Ed 2d 1283 (1958).
Compare Coletti v Ovaltine Food Products, 274 F Supp 719 (D PR, 1967); and Frank Angelilli Construction Co, Inc v Sullivan & Son, Inc, 45 Misc 2d 171; 256 NYS2d 189, aff'd 24 AD2d 491; 261 NYS2d 993, motion dismissed 16 NY2d 860; 264 NYS2d 97; 211 NE2d 519 (1965); with Stanat Manufacturing Co v Imperial Metal Finishing Co, 325 F Supp 794 (ED NY, 1971). Cf. Southgate Community School District v West Side Construction Co, 399 Mich 72, 80; 247 NW2d 884 (1976); Fries v Holland Hitch Co, 12 Mich App 178, 183; 162 NW2d 672 (1968); and Huhtala v Travelers Insurance Co, 401 Mich 118, 126; 257 NW2d 640 (1977).
Another statutory issue is whether clause (4), "contracting to insure any person, property, or risk located within this state at the time of contracting [emphasis supplied]”, expresses a limiting concept applicable to contracts to procure insurance. If so, there would be the further question whether "risk located within the state” includes inchoate risks not extant at the time of contracting.
International Shoe Co v Washington, supra, p 316.
Decision in a particular case depends on its facts, Woods v Edgewater Amusement Park, 381 Mich 559, 569; 165 NW2d 12 (1969), and an assessment of the "quality and nature” of defendant’s activity "in relation to the fair and orderly administration of the laws which it was the purpose of the due process clause to insure”. International Shoe Co v Washington, supra, p 319.
A foreign corporation which systematically and continuously employed salesmen to canvass orders in the forum state was held subject to jurisdiction in an action by the state unemployment compensation fund to recover contributions. International Shoe Co v Washington, supra. A mail order insurance company was subject to jurisdiction although it did not employ agents in the state where its insurance certificates were systematically and widely delivered in the state following solicitations based on recommendations of citizens of the state. Travelers Health Association v Virginia, 339 US 643; 70 S Ct 927; 94 L Ed 1154 (1950).
The insurer’s action in offering by mail to continue insurance written by another company, whose business it had taken over, and the acceptance of that offer and payment of premiums by the insured constituted the requisite minimum contacts although the defendant insurer had never had an office or agent in the state nor had it solicited any insurance business in the state apart from the single policy. The Court emphasized the "increasing nationalization of commerce” and that "modern transportation and communication have made it much less burdensome for a party sued to defend himself in a state where he engages in economic activity”. McGee v International Life Ins Co, 355 US 220, 223; 78 S Ct 199; 2 L Ed 2d 223 (1957).
A Philippine Islands corporation whose activities had been halted by World War II could constitutionally be subjected to Ohio jurisdiction upon causes of action arising "from activities entirely distinct from its activities in Ohio” where the limited business of the corporation was carried on under the "continuous and systematic supervision” of its president in that state. Perkins v Benguet Consolidated Mining Co, 342 US 437, 445, 447-448; 72 S Ct 413; 96 L Ed 485 (1952).
See, also, Watson v Employer’s Liability Assurance Corp, Ltd, 348 US 66; 75 S Ct 166; 99 L Ed 74 (1954), rejecting in an action by a products liability claimant equal protection, contract, due process and full faith and credit clause challenges to a Louisiana statute subjecting a foreign insurer to a direct action by an injured person without regard to whether the policy was written or delivered in Louisiana or the contract forbade such direct action.
In addition to the factors that the forum was the place where the insurance contract was delivered, premiums were mailed to the insurer, and the insured died, the Court emphasized the state’s "manifest interest in providing effective means of redress for its residents when their insurers refuse to pay claims”. The insured would be "at a severe disadvantage” if required to sue in a distant state. Small or moderate claimants could not afford the cost of maintaining an action in another state. Often important witnesses on the insurer’s defense will be found in the state where the insured resides. McGee v International Life Ins Co, supra, p 223.
Hanson v Denckla, supra, p 254.
Shaffer v Heitner, 433 US 186, 215; 97 S Ct 2569; 53 L Ed 2d 683 (1977).
The Court held that an action could not necessarily be maintained against directors and officers of a corporation in the state where it was chartered. It was not claimed that the defendants had ever entered the state or that any act related to plaintiffs’ claim took place in the state. The plaintiffs had failed to demonstrate that the state was "a fair forum for this litigation”. Id., p 215.
Although the chartering state provides substantial benefits to corporate officers and directors, that establishes "only that it is appropriate” for the state to govern the obligations of officers and directors to the corporation and its stockholders. It does not demonstrate that the officers and stockholders had "purposefully avail[ed themselves] of the privilege of conducting activities within the forum State”. Id., p 216.
The Court declared that a nonresident trustee of an inter vivos trust was not subject to jurisdiction of the state to which the settlor had moved, although she had executed a written power of appointment in favor of persons residing in that state. None of the trust assets had ever been held or administered in the state. While the trustee remitted income to the settlor in the state there was "no instance in which the trustee [emphasis in original] performed any acts in Florida that bear the same relationship to the agreement as the solicitation in McGee. Consequently, this suit cannot be said to be one to enforce an obligation that arose from a privilege the defendant exercised in Florida”. Hanson v Denckla, supra, p 252.
Shaffer v Heitner, supra, p 216. In making this observation, the Court noted the absence of a statute treating acceptance of a directorship as consent to jurisdiction in the state.
Aftanase v Economy Baler Co, 343 F2d 187, 197 (CA 8, 1965).
Kulko v Superior Court of California in & for the City & County of San Francisco, 436 US 84; 98 S Ct 1690; 56 L Ed 2d 132 (1978).
The Court declared that California could not exercise jurisdiction over a New York resident for the purpose of increasing child support allowances. The parties were both residents of New York and had married in California during a three-day stopover while the husband was en route from a military base in Texas to a tour of duty in Korea. Upon his return he spent one day in California. They lived in New York and their children were born there. The California court did not predicate jurisdiction on the three-day or the 24-hour stopover.
After the parties separated, the wife moved to California. The separation agreement was made in New York, the marital domicile. Under the separation agreement, the children spent their vacations with their mother. One of them asked to be permitted to join her mother in California and the father bought her plane ticket and she moved to California. The other child flew to California without his advance knowledge. The Court concluded that the father had not, by allowing one of the children to move to California, purposefully availed himself of the benefits and protection of California’s laws.
The Court said that the father had not caused physical injury to either property or persons or engaged in "commercial transactions in interstate commerce”. He had merely "acquiesce[d] in the stated preference of one of his children to live with her mother in California. This single act is surely not one that a reasonable parent would expect to result in the substantial financial burden and personal strain of litigating a child-support suit in a forum 3,000 miles away, and we therefore see no basis on which it can be said that appellant could reasonably have anticipated being 'haled before a [California] court’ ”. Id., pp 97-98.
Cal Code Civ Proc, § 410.10.
Kulko v Superior Court, supra, p 96.
Id., p 101.
International Shoe Co v Washington, supra, p 319. See fn 11, supra.
See 1 Restatement Conflicts, 2d, § 37, Comment (a), p 158. See also Kulko v Superior Court, supra, p 96.
We note that some large insurance agencies operate on a multistate, even nationwide, basis.
Kailieha v Hayes, 56 Hawaii 306, 312; 536 P2d 568, 572 (1975). See also Price v Shessel, 415 F Supp 306 (ED Mich, 1976), and compare with Hoagland v Springer, 75 NJ Super 560; 183 A2d 678 (1962); Roche v Floral Rental Corp, 95 NJ Super 555; 232 A2d 162 (1967); Blessing v Prosser, 141 NJ Super 548; 359 A2d 493 (1976); Edmundson v Miley Trailer Co, 211 NW2d 269 (Iowa, 1973); Walker v University Books, Inc, 382 F Supp 126 (ND Cal, 1974).
See, also, Johnson, How Minimum is "Minimum Contact"? An Examination of "Long Arm” Jurisdiction, 9 S Tex L J 184 (1967); Comment, Judicially Reñning the Missouri Long-Arm Statute: A Tort as the "Minimum Contact”, 16 St Louis U L J 315 (1971); Note, In Personam Jurisdiction Expended: Utah’s Long-Arm Statute, 1970 Utah L Rev 222; Note, Long Arm Statute Jurisdiction When the Tortious Act Occurs in One State, The Injurious Consequences in Another, 30 Ohio St L J 410 (1969); Currie, The Growth of the Long-Arm: Eight Years of Extended Jurisdiction in Illinois, 1963 U 111 L Forum 533.
The Khalafs rely on cases decided by the Court of Appeals and in other jurisdictions where long-arm jurisdiction was sustained although it would appear that the out-of-state defendant had a slight relationship with Michigan. There are a plethora of cases construing the long-arm statutes of this and other jurisdictions. We have examined the cases cited by the Khalafs and still other cases. We see no need to decide whether all those cases were correctly decided or to reconcile them. Our responsibility would be different if the other cases were decisions of the United States Supreme Court or of this Court.
Shaffer v Heitner, supra, p 215.
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Williams, J.
This No-Fault Insurance Act (MCL 500.3101 et seq.; MSA 24.13101 et seq., as amended) case, involving a woman passenger who lost the use of her limbs as the result of an accident in an automobile owned and driven by her sister, raises three issues: (1) the legal interpretation and application of "relative of either domiciled in the same household” in § 3114 of the act, because plaintiff had been living with her husband and child in a mobile home some 40 or 50 feet from her husband’s parents’ house, although they at the time of the accident were temporarily staying with plaintiff’s younger sister in her mother’s house while her mother was away; (2) whether § 3109(1) of the act, which provides "Benefits provided or required to be provided under the laws of any state or the federal government shall be subtracted from the personal protection insurance benefits otherwise payable for the injury” entitles the liable insurance carrier to subtract from personal injury protection insurance benefits otherwise due plaintiff the amount paid by Medicaid for plaintiff’s medical expenses; (3) whether, under § 3116 of the act (which provides "after recovery * * * a subtraction shall be made to the extent of the recovery”), the liable insurance carrier may subtract from the personal injury protection insurance no-fault benefits otherwise due plaintiff the amount of her recovery from the tortfeasor recovered pursuant to § 3135 of the act, which permits suit in tort "for noneconomic loss * * * if the injured person has suffered death, serious impairment of body function or permanent serious disfigurement”.
First, we affirm, applying a four-point test to the facts, the trial court’s holding that plaintiff, living in the mobile home next to her father-in-law, was "domiciled in the same household” as her father-in-law. Second, we affirm the trial court on different grounds and remand in accordance with our holding that since plaintiff is not eligible for a governmental Medicaid benefit "provided or required to be provided under the laws of any state”, any set-off pursuant to § 3109(1) is impermissible as no cognizable governmental benefit exists to be subtracted. We express no opinion with respect to the propriety of a set-off of redundant, accident-related, ex gratia governmental transfer coverage. Finally, we hold that the seemingly absolute language of § 3116 which permits subtraction of tort recoveries from personal injury protection no-fault benefits must be read in connection with § 3135, which allows tort recovery for "noneconomic loss”, to the effect that there may be subtraction for tort recoveries when the tort recovery includes damages for losses for which personal injury protection benefits were paid, but not for noneconomic recoveries permitted under § 3135.
I. Facts
Plaintiff Deborah Workman was injured and rendered a paraplegic in a one-vehicle automobile accident on August 22, 1974, in Newaygo County, while an occupant of an automobile owned and being operated by her sister, Nancy Jo Fessenden (now Nancy Jo Magoon). As a consequence of the accident plaintiff sustained severe and disabling injuries.
In early August, 1974, plaintiff, her husband James Workman, Jr., and their child moved from an apartment into a travel trailer owned by plaintiff’s father-in-law, James Workman, Sr. The trailer was located on James Workman, Sr.’s property, approximately 40 to 50 feet from his house.
In mid-August, 1974, either three or four days prior to the accident, plaintiff, her husband, and child went to stay with plaintiff’s younger sister, Jody Fessenden, at the residence of her mother, Mrs. Joann Fessenden, so the younger sister would not be alone while her mother was away on vacation. When the accident occurred on August 22, 1974, plaintiff, her husband, and child were still staying at Mrs. Fessenden’s residence. However, they planned to return to the trailer as soon as Mr. Workman’s parents returned from a vacation they were to take when their son and his family went to Mrs. Fessenden’s.
When the accident occurred, neither plaintiff nor her husband owned a motor vehicle. Because of this fact, on November 29, 1974, plaintiff filed suit to obtain declaratory judgment in Kent Circuit Court to determine which of three insurance companies was responsible for providing her personal injury protection insurance benefits under Michigan’s No-Fault Insurance Act, 1972 PA 294 as amended, MCL 500.3101 et seq.; MSA 24.13101 et seq. (hereinafter referred to as the "No-Fault Act” or "the act”). Because neither plaintiff nor her husband owned a motor vehicle themselves, the relevant statutory provision for determining which insurer was responsible to her for personal injury protection insurance benefits is § 3114. Under § 3114(1), as amended by 1975 PA 137, "a personal protection insurance policy applies to accidental bodily injury to the person named in the policy, his spouse and a relative of either domiciled in the same householdThus, arguably, plaintiffs mother’s insurer, Wolverine Insurance Company, was responsible for providing plaintiffs personal injury benefits if plaintiff was "domiciled in the same household” as her mother. Or, arguably, plaintiffs father-in-law’s insurer, Community Services Insurance Company, was responsible for providing plaintiffs personal injury benefits if plaintiff was "a relative” to him and was "domiciled in the same household”. However, if neither of the above situations were applicable, i.e., § 3114(1) was not applicable to this case, then §3114(4)(a) would come into effect. This provision states:
"(4) Except as provided in subsections (1) to (3), a person suffering accidental bodily injury while an occupant of a motor vehicle shall claim personal protection insurance benefits from insurers in the following order of priority:
"(a) The insurer of the owner or registrant of the vehicle occupied.” MCL 500.3114(4); MSA 24.13114(4).
If § 3114(4)(a) were applicable, plaintiffs sister Nancy Jo Fessenden’s insurer, Detroit Automobile Inter-Insurance Exchange, would be responsible for providing her personal injury benefits.
On May 5, 1975, the trial court granted a summary judgment of no cause of action to Wolverine Insurance Company on the . insurance policy cover ing plaintiffs mother, Mrs. Joann Fessenden, on the basis that plaintiff was not domiciled at her mother’s residence when the accident occurred.
On September 19, 1975, after trial between plaintiff and the remaining two defendants, Community Services Insurance Company and Detroit Automobile Inter-Insurance Exchange, the court held defendant Community Services Insurance Company (plaintiffs father-in-law’s insurer) responsible for providing plaintiff personal injury protection insurance benefits under the No-Fault Act. In addition, the court held there was no cause of action as to defendant Detroit Automobile Inter-Insurance Exchange (plaintiffs sister’s insurer).
The proceedings at this point become factually complicated.
On October 2, 1975, plaintiff made a motion to reopen proofs and for summary judgment with respect to the following relief she prayed for in the first amended complaint of April 18, 1975:
"Comes now the above named plaintiff and amends her complaint by addition to the prayer for relief as follows:
"(e) determine that benefits payable to plaintiff under the No-Fault Automobile Insurance Statute are not subject to reduction by benefits paid or payable to plaintiff by Michigan Department of Social Services under its Medicaid program; that is [MCL 500.3109(1); MSA 24.13109(1)] does not apply to benefits paid or payable under the Medicaid program operated by Michigan Department of Social Services.”
On October 10, 1975, defendant Community Services Insurance Company appealed the judgment in favor of Detroit Automobile Inter-Insurance Exchange to the Court of Appeals. On October 14, 1975, plaintiff cross-appealed. On this same date, the court also granted plaintiffs October 2 motion to reopen proofs with respect to the issue stated in her April 18 amended complaint. On November 28, 1975, plaintiff filed a second amended complaint, and the court granted leave to further amend her complaint, this time to include the following issue:
"Comes now the above named plaintiff and further amends her complaint as amended on April 18, 1975, by addition to the prayer for relief as follows:
"(f) determine that the defendant adjudged by this court to be liable to plaintiff for no-fault benefits is not entitled to subtraction from no-fault benefits accrued nor reimbursement for no-fault benefits paid, in respect to plaintiffs recovery from the third-party tortfeasor.”
Importantly, while the above proceedings were taking place, plaintiff and her husband had brought suit in tort for the injuries she sustained in the accident. The elements of damages claimed in their complaint were limited to "noneconomic loss” as provided for by § 3135 of the No-Fault Act (quoted part IV, p 505 infra and see fn 1 infra). In December, 1975, the case was settled for $17,500, and plaintiff received the entire amount of the settlement proceeds (the above facts relating to this tort suit and the subsequent settlement are acknowledged in the record in a "Concise Statement of Proceedings and Facts” filed by the parties on February 17, 1976).
On December 22, 1975, the trial court entered an opinion as to the two issues "reopened” at trial. On January 9, 1976, the trial court entered the following supplemental judgment as to the two "reopened” issues:
"Now, therefore, it is ordered and adjudged, and the court does hereby determine, that § 3109(1) of the Michigan No-Fault Automobile Insurance Law [MCL 500.3109(1); MSA 24.13109(1)] does not apply to benefits paid or payable to plaintiff by or through the Michigan Department of Social Services as Medicaid, and that no subtraction shall be made on that account from benefits otherwise payable to or for the benefit of plaintiff under said no-fault law.
"It is further ordered and adjudged, and the court does hereby determine, that § 3116 of said no-fault law violates the equal protection provision, article 1, § 2, and the due process provision, article 1, § 17, of the Michigan Constitution of 1963, and is therefore unconstitutional, to the extent that it directs subtraction from no-fault benefits otherwise payable to plaintiff for the recovery obtained by her in Kent Circuit Court Case No. 75-17844-NI, Workman v Magoon, and to the extent that it grants the no-fault insurance carrier a lien upon said recovery.”
(See § 3116 quoted in part IV, p 506 infra).
Defendant Community Services Insurance Company then filed an appeal to the Court of Appeals with respect to this supplemental judgment.
On February 17, 1976, both plaintiff and defendant Community Services Insurance Company joined in application for leave to appeal to this Court prior to decision of the Court of Appeals. Defendant Detroit Automobile Inter-Insurance Exchange filed a brief in support of this application for leave to appeal. The parties in their "Concise Statement of Proceedings and Facts” stipulated that the "issues presented on appeal are these”:
"(a) Which defendant is liable to plaintiff for no-fault benefits?
"(b) Does § 3109(1) of the No-Fault Act entitle the liable carrier to subtract from no-fault benefits otherwise due plaintiff the amount paid by Medicaid on plaintiffs medical expense?
"(c) Does § 3116 of the No-Fault Act entitle the liable carrier to subtract from no-fault benefits otherwise due plaintiff the amount of her recovery from the tortfeasor?”
On June 1, 1976, this Court granted by-pass leave as to these issues.
II. Which Defendant Is Responsible to Plaintiff for Payment of Personal Injury Protection Insurance Benefits Under the No-Fault Act?
The first issue before us is the determination of which defendant, Community Services Insurance Company (hereinafter referred to as Community Services) or Detroit Automobile Inter-Insurance Exchange (hereinafter referred to as DAIIE), is responsible to plaintiff for payment of personal injury protection insurance benefits under the No-Fault Act.
This question arises because neither plaintiff nor her spouse owned a motor vehicle. Because of this fact, the relevant statutory scheme for determining which insurance carrier is responsible to plaintiff for payment of personal injury protection insurance benefits is § 3114 of the act, in particular subsections (1) and (4)(a). Section 3114 provides, in pertinent part:
"(1) Except as provided in subsections (2) and (3), a personal protection insurance policy applies to accidental bodily injury to the person named in the policy, his spouse, and a relative of either domiciled in the same household. * * *
"(4) Except as provided in subsections (1) to (3), a person suffering accidental bodily injury while an occupant of a motor vehicle shall claim personal protection insurance benefits from insurers in the following order of priority:
"(a) The insurer of the owner or registrant of the vehicle occupied.” MCL 500.3114; MSA 24.13114.
As our statement of facts indicates, defendant Community Services is the insurer of James Workman, Sr., plaintiff’s father-in-law. Defendant DAIIE is the insurer of Nancy Jo Fessenden, the owner and registrant of the motor vehicle in which plaintiff was an occupant (or passenger) when she was injured. At trial, and before us, Community Services argues that it is not responsible to plaintiff for payment of personal injury insurance benefits pursuant to § 3114(1) because plaintiff was not "a relative of [and] domiciled in the same household” as its insured, her father-in-law James Workman, Sr. If Community Services is correct in its argument, it is undisputed that DAIIE is responsible to plaintiff for payment of personal injury protection insurance benefits, because its insured, Nancy Jo Fessenden, was, under § 3114(4)(a), owner and registrant of the motor vehicle in which plaintiff was an occupant when she was injured.
Therefore, for purposes of analysis, the dispositive question is whether plaintiff was a "relative of [and] domiciled in the same household” as her father-in-law James Workman, Sr. If the answer to this is yes, Community Services is responsible to plaintiff for payment of personal injury protection insurance benefits. If the answer is no, DAIIE is responsible to plaintiff for these benefits.
We agree with the trial court that the answer to this question is yes: plaintiff was a "relative of [and] domiciled in the same household” as her father-in-law, James Workman, Sr.
In reaching this conclusion, it is necessary to address, analytically, two considerations: (1) whether plaintiff was a "relative” of Community Services’ insured, plaintiff’s father-in-law, James Workman, Sr.; and (2) whether plaintiff was "domiciled in the same household” as James Workman, Sr.
The consideration of whether plaintiff was a "relative” of her father-in-law, James Workman, Sr., need not detain us long. Community Services, in its brief, concedes the fact that as a matter of law "plaintiff is a relative of Mr. Workman, Sr.”
Whether plaintiff was "domiciled in the same household” as James Workman, Sr., is, analytically, a more complicated consideration. It has not been brought to our attention, nor have we been able to find a case which deals specifically with the interpretation of an insurance policy or statute containing the language "domiciled in the same household”. However, the parties to this case have brought to our attention a body of law which deals with the question of whether a person is a "resident” of an insured’s "household” under particular insurance policies. Although the statutory language of § 3114(1) refers to persons "domiciled in the same household” as an insured, we believe this body of law is analytically applicable to the consideration before us. We conclude this because, in this state, the terms "domicile” and "residence” are legally synonymous (except in special circumstances).
Our review of both Michigan opinions and opinions of our sister state courts first reveals the general principle that the terms "resident” of an insured’s "household” or, to the same effect, "domiciled in the same household” as an insured, have "no absolute meaning”, and that their meaning "may vary according to the circumstances”. Cal- Farm Ins Co v Boisseranc, 151 Cal App 2d 775, 781; 312 P2d 401, 404 (1957). The "legal meaning” of these terms must be viewed flexibly, "only within the context of the numerous factual settings possible”. Montgomery v Hawkeye Security Ins Co, 52 Mich App 457, 461; 217 NW2d 449 (1974).
Accordingly, both our courts and our sister state courts, in determining whether a person is a "resident” of an insured’s "household” or, to the same analytical effect, "domiciled in the same household” as an insured, have articulated a number of factors relevant to this determination. In considering these factors, no one factor is, in itself, determinative; instead, each factor must be balanced and weighed with the others. Among the relevant factors are the following: (1) the subjective or declared intent of the person of remaining, either permanently or for an indefinite or unlimited length of time, in the place he contends is his "domicile” or "household”; Hartzler v Radeka, 265 Mich 451; 251 NW 554 (1933); Henry v Henry, 362 Mich 85, 101; 106 NW2d 570 (1960); Iowa National Mutual Ins Co v Boatright, 33 Colo App 124, 127; 516 P2d 439, 440 (1973); Hardware Mutual Casualty Co v Home Indemnity Co, 241 Cal App 2d 303; 50 Cal Rptr 508 (1966); (2) the formality or informality of the relationship between the person and the members of the household; Iowa National Mutual Ins Co v Boatright, supra; Pamperin v Milwaukee Mutual Ins Co, 55 Wis 2d 27, 33; 197 NW2d 783, 788 (1972); (3) whether the place where the person lives is in the same house, within the same curtilage or upon the same premises, Mazzilli v Accident & Casualty Ins Co of Winterthur, Switzerland, 35 NJ 1; 170 A2d 800, 804 (1961); (4) the existence of another place of lodging by the person alleging "residence” or "domicile” in the household; Iowa National Mutual Ins Co v Boatright, supra; see also State Farm Mutual Automobile Ins Co v Holloway, 423 F2d 1281 (CA 10, 1970).
When the above factors are tested against the facts in the record in this case, it is overwhelmingly clear, as the trial court held, that plaintiff was "domiciled in the same household” as her father-in-law, James Workman, Sr.
First, the record reveals facts indicating it was plaintiffs intention to remain living in the trailer on the property of James Workman, Sr., for at least an indefinite length of time. Plaintiff testified that although she, her husband and child were temporarily staying with her younger sister in her mother’s home when the accident occurred, if the accident had not happened, it was her family’s intention to have gone back to the trailer and remain living there "for an indefinite period of time”. Plaintiff further testified that she and her husband were not looking for any other place to live and that she considered the trailer as her home. In addition, she testified that her family’s mailing address was the same as her father-in-law’s. Second, the record reveals facts indicating that the relationship between plaintiff, her hus band and child, and her father-in-law’s family was informal and friendly. Plaintiff testified that she was welcome to use and did use all of the facilities of the house (i.e., telephone, washers and dryers, and electricity, by cord from the house to the trailer), that her family ate meals with the senior Workman’s family, and that during the day she and her child were "in and out” of the house. Third, the record reveals that the trailer in which plaintiff and her family lived was unquestionably on the same premises, or property, as her father-in-law’s house, and that the trailer belonged to her father-in-law. The trailer was located 40 to 50 feet from the house. The electrical power for the trailer was supplied by a cord attached to the house and water for the trailer was provided by means of a hose connected to the house. Furthermore, testimony established there was no fence or physical barrier of any type between the house and the trailer. Fourth, the record reveals that plaintiff and her family had left the apartment they were living in prior to moving into the trailer and had no intention of returning there (or to any other lodging).
For these reasons, we hold that plaintiff was, under § 3114(1) of the No-Fault Act, "a relative of [and] domiciled in the same household” as her father-in-law, James Workman, Sr. Accordingly, we affirm the trial court’s conclusion that Community Services Insurance Company is responsible to plaintiff for personal injury protection insurance • benefits under the No-Fault Act.
III. Whether § 3109(1) of the No-Fault Act Applies to Medicaid Benefits Authorized by the Social Welfare Act and Administered by the Michigan Department of Social Services
In 1974, plaintiff was rendered a paraplegic as a consequence of an automobile accident. Plaintiff claimed state "Medicaid” benefits, MCL 400.105 et seq.; MSA 16.490(15) et seq., as a "medically indigent individual”, MCL 400.106; MSA 16.490(16), under the Michigan Social Welfare Act, 1939 PA 280.
Section 3109(1) of the No-Fault Act provides:
"Benefits provided or required to be provided under the laws of any state or the federal government shall be subtracted from the personal protection insurance benefits otherwise payable for the injury.” (Emphasis supplied.) MCL 500.3109(1); MSA 24.13109(1).
Defendants contend that, if they are held liable as plaintiff’s no-fault insurer, the amount of state governmental Medicaid benefits paid or payable on behalf of plaintiff’s medical expense should be subtracted from plaintiff’s § 3107(a) personal protection insurance benefits pursuant to § 3109(1).
Considering this contention, the trial court declared in its supplemental judgment that, as a matter of "statutory construction”, § 3109(1)
"does not apply to benefits paid or payable to plaintiff by or through the Michigan Department of Social Services as Medicaid, and that no subtraction shall be made on that account from benefits otherwise payable to or for the benefit of plaintiff under said no-fault law.”
We disagree with the trial court’s ruling insofar as it is apparently based on the mistaken assumption that plaintiff is eligible for a "governmental” benefit cognizable under the § 3109(1) set-off scheme. Any consideration of the propriety of a § 3109(1) governmental benefit set-off is thereby rendered unnecessary; there exist no "benefits provided or required to be provided under the laws of’ Michigan to be arguably set off by defendants.
The Social Welfare Act, 1939 PA 280, was enacted by the Michigan Legislature " * * * to protect the welfare of the people of this state; to provide general relief, hospitalization, infirmary and medical care to poor or unfortunate persons * * * ”, long title of 1939 PA 280. "Medicaid” is a "program for medical assistance for the medically indigent”, MCL 400.105; MSA 16.490(15), authorized by the Social Welfare Act and administered by the Michigan Department of Social Services, MCL 400.105; MSA 16.490(15). The Medicaid program is required to be administered pursuant to subchapter XIX, 42 USC 1396 et seq., of the Federal Social Security Act, MCL 400.105; MSA 16.490(15). Subchapter XIX was enacted by the United States Congress
"For the purpose of enabling each State, * * * to furnish (1) medical assistance on behalf of * * * disabled individuals, whose income and resources are insufficient to meet the costs of necessary medical services, * * * 42 USC 1396.
It is clear from the sense of the above provisions as well as the express language of § 105 of the Social Welfare Act that eligibility for Medicaid is contingent upon the finding that a claimant is "medically indigent” insofar as that individual’s income or collateral resources are concerned. In fact, § 106 of the Social Welfare Act specifically defines a "medically indigent individual” in relevant part as follows:
"(b) His need for the type of medical assistance available under this act for which application has been made has been professionally established and no payment for it is available through the legal obligation of a contractor, public or private, to pay or provide for the care without regard to the income or resources of the patient. The department shall be subrogated to any right of recovery which a patient may have for the cost of hospitalization, pharmaceutical services, physician services, and nursing services not to. exceed the amount of funds expended by the department for such care and treatment of the patient. The patient or other person acting in his behalf shall execute and deliver an assignment of claim or other authorizations as necessary to secure the right of recovery to the department. * * * ” MCL 400.106(2); MSA 16.490(16)(2). (Emphasis supplied.)
We perceive plaintiff’s § 3107(a) no-fault personal protection insurance coverage with defendant-insurers to constitute " * * * [medical assistance] available through the legal obligation of a contractor, public or private, to pay or provide for the care without regard to the income or resources of the patient”. As such, plaintiff is expressly precluded from qualifying as a medically indigent individual eligible for medical assistance under the state Medicaid program. This finding requires us to conclude that Medicaid benefits are not in the nature of § 3109(1) benefits "required to be provided under the laws of any state or the federal government”; any attempted set-off of plaintiff’s Medicaid benefits would, therefore, not only be unnecessary but absurd since no "benefits” exist to be set off.
Further, the fact that plaintiff has been "provided” Medicaid benefits covering injuries sustained in her accident does not alter this result. Both §§ 106(2)(b) and 107 of the Social Welfare Act contemplate that under certain circumstances Medicaid benefits may potentially be made available to medically solvent individuals. In such instances, however, those statutes further provide that the Department of Social Services shall be entitled to a right of either subrogation or reimbursement to the extent of those Medicaid benefits paid.
Insofar as our reading of § 106(2)(b) of the Social Welfare Act is concerned, we are of the opinion that plaintiff is not statutorily eligible to receive state Medicaid benefits. As such, we are not here confronted with a state governmental benefit "provided or required to be provided under the laws of any state or the federal government”, an element requisite to the operation of § 3109(1). Accordingly, absent this pivotal element, we need not reach the § 3109(1) set-off urged by the parties and adjudicated by the trial court as there exists no cognizable governmental benefit for the insurer to subtract from plaintiff’s § 3107(a) personal protection insurance benefits under the mandates of § 3109(1). We, therefore, affirm on different grounds the trial court’s order disallowing the set-off and remand this issue for disposition consistent with this opinion. We express no opinion with respect to the propriety of setting off other redundant, accident-related, ex gratia governmental transfer benefits.
IV. Whether § 3116 of the No-Fault Act Entitles Community Services to Subtract From Plaintiff’s Personal Injury
Protection Insurance Benefits the Amount Received by Plaintiff in Tort Recovery From the Tortfeasor
The third issue before us is whether § 3116 of the No-Fault Act entitles Community Services Insurance Company (the insurer responsible to plaintiff for payment of personal injury protection insurance benefits) to subtract from these benefits the amount plaintiff received (after settlement) in tort recovery from the tortfeasor, Nancy Jo Fessenden.
As indicated in our statement of facts, plaintiff moved to amend her complaint to include this issue after the trial court had decided the question of which insurer was responsible to plaintiff for payment of personal injury protection insurance benefits. See discussion part I, supra, p 488. Also, the record indicates that before the trial court entered its supplemental judgment as to this issue, plaintiff settled a tort suit against Nancy Jo Fessenden, the operator of the motor vehicle in which she was injured, for $17,500. This suit was brought pursuant to § 3135 of the No-Fault Act, which provides:
"(1) A person remains subject to tort liability for noneconomic loss caused by his ownership, maintenance or use of a motor vehicle only if the injured person has suffered death, serious impairment of body function or permanent serious disñgurement.
"(2) Notwithstanding any other provision of law, tort liability arising from the ownership, maintenance or use within this state of a motor vehicle with respect to which the security required by subsections (3) and (4) of section 3101 was in effect is abolished except as to:
"(a) Intentionally caused harm to persons or property. Even though a person knows that harm to persons or property is substantially certain to be caused by his act or omission, he does not cause or suffer such harm intentionally if he acts or refrains from acting for the purpose of averting injury to any person, including himself, or for the purpose of averting damage to tangible property.
"Go) Damages for noneconomic loss as provided and limited in subsection (1).
"(c) Damages for allowable expenses, work loss and survivor’s loss as defined in sections 3107 to 3110 in excess of the daily, monthly and 3 year limitations contained in those sections. The party liable for damages is entitled to an exemption reducing his liability by the amount of taxes that would have been payable on account of income the injured person would have received if he had not been injured.” MCL 500.3135; MSA 24.13135. (Emphasis added.)
Plaintiff contends that she is entitled to the full amount of her tort recovery against Nancy Jo Fessenden (subject to attorney fees and costs). Community Services argues that § 3116 of the No- Fault Act entitles it to subtract this amount (exclusive of reasonable attorney fees and costs) from the personal injury protection insurance benefits it must pay plaintiff. This section provides:
"(1) A subtraction from personal protection insurance benefits shall not be made because of the value of a claim in tort based on the same accidental bodily injury. However, after recovery is realized upon a tort claim, a subtraction shall be made to the extent of the recovery, exclusive of reasonable attorneys’ fees and other reasonable expenses incurred in effecting the recovery. If personal protection insurance benefits have already been received, the claimant shall repay to the insurers out of the recovery a sum equal to the benefits received, but not more than the recovery exclusive of reasonable attorneys’ fees and other reasonable expenses incurred in effecting the recovery. The insurer shall have a lien on the recovery to this extent. A recovery by an injured person or his estate for loss suffered by him shall not be subtracted in calculating benefits due a dependent after the death and a recovery by a dependent for loss suffered by the dependent after the death shall not be subtracted in calculating benefits due the injured person.
"(2) A personal protection insurer with a right of reimbursement under subsection (1), if suffering loss from inability to collect reimbursement out of a payment received by a claimant upon a tort claim is entitled to indemnity from a person who, with notice of the insurer’s interest, made such a payment to the claimant without making the claimant and the insurer joint payees as their interests may appear or without obtaining the insurer’s consent to a different method of payment.” MCL 500.3116; MSA 24.13116.
The trial court, in its supplemental judgment, declared:
"It is further ordered and adjudged, and the court does hereby determine, that § 3116 of said no-fault law violates the equal protection provision, art 1, § 2, and the due process provision, art 1, § 17, of the Michigan Constitution of 1963, and is therefore unconstitutional, to the extent that it directs subtraction from no-fault benefits otherwise payable to plaintiff for the recovery obtained by her in Kent Circuit Court Case No. 75-17844-NI, Workman v Magoon, and to the extent that it grants the no-fault insurance carrier a lien upon said recovery.”
Although we agree with the effect of the trial court’s judgment, i.e., Community Services may not subtract the amount of plaintiffs tort recovery (exclusive of reasonable attorney fees and costs) pursuant to § 3116, we disagree with its disposition of this issue on constitutional grounds.
It is a well-established, cardinal rule of statutory construction that provisions of a statute must be construed in light of the other provisions of the statute, in such a manner as to carry out the apparent purpose of the Legislature and to permit its constitutional validity to be sustained. In re Petition of Bryant, 323 Mich 424, 437; 35 NW2d 371 (1949). Accordingly, as stated in Grand Rapids v Crocker, 219 Mich 178, 182-183; 189 NW 221 (1922), in construing the meaning of particular statutory provisions, it is elementary that
"effect must be given, if possible, to every word, sentence and section. To that end, the entire act must be read, and the interpretation to be given to a particular word in one section arrived at after due consideration of every other section so as to produce, if possible, a harmonious and consistent enactment as a whole.”
See also Dussia v Monroe County Employees Retirement System, 386 Mich 244, 248; 191 NW2d 307 (1971).
Or, as Justice Brandéis stated in his concurring opinion in Ashwander v Tennessee Valley Authority, 297 US 288, 348; 56 S Ct 466; 80 L Ed 688 (1936):
" 'When the validity of an act of the Congress is drawn in question, and even if a serious doubt of constitutionality is raised, it is a cardinal principle that this Court will first ascertain whether a construction of the statute is fairly possible by which the question may be avoided.’ ” (Citation omitted.)
The issue raised in this case is the alleged conflict between § 3135 and § 3116 of the No-Fault Act.
Section 3135, in particular subds (1), (2)(b) and (2)(c) provide a specific threshold for motor-vehicle accident-related tort suits, i.e., tort liability is not abolished with respect to "noneconomic loss” if the injured person "has suffered death, serious impairment of body function or permanent serious disfigurement” (§§ 3135[1], 3135[2][b]) and if the injured person’s "[djamages for allowable expenses, work loss and survivor’s loss as defined in sections 3107 to 3110” are "in excess of the daily, monthly, and 3 year limitations contained in those sections” (§ 3135[2][c]). The legislative intent, inferable from the face of this provision, is clear: the Legislature intended to allow the catastrophically injured victim and the victim of extraordinary economic losses compensation in addition to that provided by §§ 3107 to 3110 of the act.
Section 3116 provides, in pertinent part:
"after recovery is realized upon a tort claim, a subtraction shall be made to the extent of the recovery, exclusive of reasonable attorneys’ fees and other reasonable expenses incurred in effecting the recovery. If personal protection insurance benefits have already been received, the claimant shall repay to the insurers out of the recovery a sum equal to the benefits received.” MCL 500.3116; MSA 24.13116.
If this statutory language is literally construed and read alone, then an insurer, "after recovery is realized upon a tort claim”, may subtract personal injury protection insurance benefits "to the extent of the recovery”, etc. However, if this statutory language is read in the light of § 3135, we are left with an apparent and patent absurdity: the Legis lature, on the one hand, provides an injured person limited tort remedy in § 3135 of the act while, on the other hand, providing that any tort recovery achieved pursuant to § 3135 will be effectively taken away under § 3116 of the act.
This absurdity can be avoided, however, by applying the rules of statutory construction articulated supra, i.e., by construing § 3116 in a fashion which both carries out the apparent purpose of the Legislature and harmonizes this section with § 3135 and the due process and equal protection clauses of the Michigan and United States Constitutions. Accordingly, in light of § 3135, we construe § 3116 to mean that an insurance carrier paying personal injury protection benefits is entitled to reimbursement from the tort recovery of a person injured as a result of a motor vehicle accident only if, and to the extent that, the tort recovery includes damages for losses for which personal injury protection benefits were paid. Thus, since § 3135 abolishes tort remedy for losses covered under the personal injury protection insurance provisions of the act, an injured plaintiff should recover nothing for which the insurance carrier will have a right of reimbursement under §3116. We believe this interpretation of § 3116 not only gives full effect to § 3135, but it also effectuates the essential purposes of this section, namely, to prevent double recovery of economic loss by those persons who retain their right to sue in tort for economic loss under the act.
Defendant Community Services citing Pelkey v Elsea Realty & Investment Co, 394 Mich 485; 232 NW2d 154 (1975), raises the thoughtful and interesting point that under the law of workers’ compensation, subtraction from benefits to the extent of total third-party tort recovery minus reasonable expenses and attorney fees is authorized. However, the analogy of the Worker’s Disability Compensation Act to the No-Fault Act is not exact and Pelkey is not controlling. As plaintiff correctly points out, the tort recovery under the Worker’s Disability Compensation Act is for all damages, economic and noneconomic, MCL 418.827; MSA 17.237(827), whereas a § 3135 recovery is only for "noneconomic loss” which by definition excludes all benefits payable under no-fault. This comparison is useful, however, because it does indicate that the Legislature, although by different methods, in both acts provided against double recovery.
Therefore, we hold, on the basis of statutory construction, that § 3116 of the No-Fault Act does not entitle Community Services to subtract plaintiff’s tort recovery from the personal injury protection benefits it must pay plaintiff, because plaintiff’s tort recovery was made pursuant to § 3135 of the act and included damages for losses for which personal injury protection benefits are not paid.
V. Conclusion
For the reasons set out above, we therefore hold (1) that plaintiff was "domiciled in the same house hold” as her father-in-law and affirm the trial judge on this issue; (2) that Medicaid benefits are not subject to a § 3109(1) set-off, affirm on different grounds the trial judge’s order disallowing the set-off and remand for a disposition of this issue consistent with this opinion, expressing no opinion as to the propriety of a § 3109(1) set-off of redundant, accident-related, ex gratia governmental transfer coverage; and (3) that the language of § 3116 permitting subtraction from no-fault benefits of tort recoveries must be read in connection with § 3135 allowing tort recoveries for "noneconomic loss”, thereby excluding plaintiff’s tort recovery of noneconomic loss under § 3135, and, accordingly affirm the trial judge, but on the basis of statutory construction rather than unconstitutionality.
Affirmed in part; reversed in part; and remanded in part. No costs, a public question being involved.
Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred with Williams, J.
These issues come to us on appeal of a judgment of a request for declaratory relief. GCR 1963, 521.1, the declaratory judgment rule, requires that plaintiffs, in order to establish standing pursuant to this rule, must show a "case of actual controversy”. See Shavers v Attorney General, 402 Mich 554; 267 NW2d 72 (1978).
The fact that plaintiff has standing pursuant to this rule with respect to the issues raised is undisputed. We wish to note, however, that in Shavers v Attorney General, supra, we held that the plaintiffs in that case lacked standing to seek declaratory relief with respect to the question of whether § 3116 of the No-Fault Act entitles an insurance carrier to subtract from personal injury protection insurance benefits otherwise due a person injured as a result of a motor vehicle accident the amount the injured person recovered from a tortfeasor. Our holding was based on the fact that "[tjhere is no proof on the record that any plaintiff had realized a tort claim which an insurer subtracted from the personal injury protection benefits which he received or to which he was entitled.” 402 Mich 592, fn 13.
We clearly have no such problem here with respect to this issue. In the "Concise Statement of Proceedings and Facts” the parties stipulated that:
"In the meantime, plaintiff and her husband had brought suit on their tort liability claims (Workman v Magoon, Kent Circuit Court Case No. 75-17844-NI). The elements of damages claimed in their Complaint were limited to those preserved by [MCL 500.3135; MSA 24.13135] of the No-Fault Act. The case was settled in December, 1975 for $17,500, and plaintiff Deborah Workman has received the entire amount of the settlement proceeds.”
Thus, we are squarely faced with a "case of actual controversy” concerning the interpretation of § 3116.
If plaintiff or her husband had owned a motor vehicle, her insurer or her husband’s insurer would have been responsible to her for payment of personal injury protection insurance benefits pursuant to the following language of § 3114(1) of the act: "a personal protection insurance policy applies to accidental bodily injury to the person named in the policy, his spouse”. MCL 500.3114(1); MSA 24.13114(1).
See Brief on Appeal — Appellant, p 12, where defendant-appellant Community Services acknowledges: "sticking to the interpretation of the statute itself, plaintiff is a relative of Mr. Workman, Sr.” See also, in support of this conclusion, Bliss v Caille Brothers Co, 149 Mich 601, 608; 113 NW 317 (1907).
Gluc v Klein, 226 Mich 175, 178; 197 NW 691 (1924); Hartzler v Radeka, 265 Mich 451, 452; 251 NW 554 (1933); Reaume & Silloway, Inc v Tetzlaff, 315 Mich 95; 23 NW2d 219 (1946). For an example of such a "special circumstance”, see School District No 1, Fractional, of Mancelona Twp v School District No 1 of Custer Twp, 236 Mich 677, 681; 211 NW 60 (1926); Ortman v Miller, 33 Mich App 451, 458; 190 NW2d 242 (1971).
See Montgomery v Hawkeye Security Ins Co, 52 Mich App 457, 461; 217 NW2d 449 (1974).
We emphasize, again, that "no one factor is, in itself, determina- ’ tive” in making a determination of whether a person is a "resident” of an insured’s household. For an example of a case in which a person did not "live in the same house, within the same curtilage or upon the same premises” as an insured but was found by the court to be, nevertheless, a "resident” of the insured’s "household”, on balance of other relevant factors, see Montgomery v Hawkeye Security Ins Co, supra. In other words, analytically, if a person does, in fact, "live in the same house, within the same curtilage or upon the same premises” as an insured, there is more weight in support of the conclusion he is a "resident” of the insured’s "household”.
The parties have stipulated that an indeterminate amount of plaintiffs medical expenses have been paid by Medicaid and that payment of the balance by that program awaits our resolution of this case. While the parties do not expressly state under which provision of the Medicaid program plaintiff seeks to qualify as a statutory "medical indigent”, we assume that she is seeking medical assistance under MCL 400.106(2); MSA 16.490(16)(2) as she is apparently not an "aid to dependent children” recipient, MCL 400.106(1); MSA 16.490(16)(1).
Section 3107(a) of the No-Fault Act provides that personal protection insurance benefits are payable for the following medical losses:
"(a) Allowable expenses consisting of all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation. Allowable expenses within personal protection insurance coverage shall not include charges for a hospital room in excess of a reasonable and customary charge for semiprivate accommodations except when the injured person requires special or intensive care, or charges for funeral and burial expenses in excess of $1,000.00.” MCL 500.3107(a); MSA 24.13107(a).
Sections 106(2)(b) and 109 ("medical services provided under * * * act”) of the Social Welfare Act evidence that Medicaid recipients are entitled to similar medical coverage as that permitted under § 3107(a) of the No-Fault Act.
Further support for our conclusion that no-fault personal protection insurance coverage is in the nature of a "legal obligation of a [private] contractor” sufficient to preclude Medicaid eligibility is found in the 1976 amendatory language to § 106(2)(b) of the Social Welfare Act not found in that section when this action was instituted. This amendatory language specifically excludes Medicaid eligibility where the claimant is entitled to no-fault coverage unless the claimant’s entitlement to that collateral coverage is at issue. Specifically, this language provides:
"A payment may be withheld under this act for medical assistance for an injury or disability for which the patient is entitled to medical care or reimbursement for the cost of medical care under sections 3101 to 3179 of Act No. 218 of the Public Acts of 1956, as amended, being sections 500.3101 to 500.3179 of the Michigan Compiled Laws, or under any other policy of insurance providing medical or hospital benefits, or both, for the patient unless the patient’s entitlement to that medical care or reimbursement is at issue.” MCL 400.106(2)(b); MSA 16.490(16)(2)(b). Amended by 1976 PA 284, imd eff October 20.
Although this language was not in esse at the time plaintiff commenced this action, we find it to constitute persuasive authority for our ruling in this regard.
Section 106(2)(b) of the Social Welfare Act in discussing the effect of collateral insurance coverage on Medicaid eligibility provides in pertinent part as follows:
"The department shall be subrogated to any right of recovery which a patient may have for the cost of hospitalization, pharmaceutical services, physician services, and nursing services not to exceed the amount of funds expended by the department for such care and treatment of the patient. The patient or other person acting in his behalf shall execute and deliver an assignment of claim or other authorizations as necessary to secure the right of recovery to the department.” MCL 400.106(2)(b); MSA 16.490(16)(2)(b). (Emphasis supplied.)
MCL 400.107; MSA 16.490(17) provides:
"In establishing financial eligibility for the medically indigent as defined in section 106(2) income shall be disregarded in accordance with standards established for the related categorical assistance program. Additional income shall be applied against: (i) the cost of medical care not authorized under this act, and (ii) the cost of services authorized under this act, in excess of the basic amount. For medical assistance only, income shall include the amount of contribution which an estranged spouse or parent for a minor child is making to the applicant according to the standards of the state department, or pursuant to a court determination, if there is such a determination. Nothing in this section shall eliminate the responsibility of support established in section 76 for cash assistance received under this act.”
Similar provision is made in the 1976 amendatory language to § 106(2)(b) of the Social Welfare Act:
"A payment may be withheld under this act for medical assistance for an injury or disability for which the patient is entitled to medical care or reimbursement for the cost of medical care under sections 3101 to 3179 of Act No. 218 of the Public Acts of 1956, as amended, being sections 500.3101 to 500.3179 of the Michigan Compiled Laws, or under any other policy of insurance providing medical or hospital benefits, or both, for the patient unless the patient’s entitlement to that medical care or reimbursement is at issue.” MCL 400.106(2)(b); MSA 16.490(16)(2)(b), amended by 1976 PA 284, § 1 imd eff October 20. (Emphasis supplied.)
This provision is qualified by the Department of Social Services statutory right of recovery to the extent of Medicaid benefits paid at such time as the claimant’s "entitlement to [no-fault] medical care” is no longer determined to be at issue.
See fn 1, supra.
Section 3107 provides:
"Personal protection insurance benefits are payable for the following:
"(a) Allowable expenses consisting of all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation. Allowable expenses within personal protection insurance coverage shall not include charges for a hospital room in excess of a reasonable and customary charge for semiprivate accommodations except when the injured person requires special or intensive care, or charges for funeral and burial expenses in excess of $1,000.00.
"(b) Work loss consisting of loss of income from work an injured person would have performed during the first 3 years after the date of the accident if he had not been injured and expenses not exceeding $20.00 per day, reasonably incurred in obtaining ordinary and neces sary services in lieu of those that, if he had not been injured, an injured person would have performed during the first 3 years after the date of the accident, not for income but for the benefit of himself or of his dependent. Work loss does not include any loss after the date on which the injured person dies. Because the benefits received from personal protection insurance for loss of income are not taxable income, the benefits payable for such loss of income shall be reduced 15% unless the claimant presents to the insurer in support of his claim reasonable proof of a lower value of the income tax advantage in his case, in which case the lower value shall apply. The benefits payable for work loss sustained in a single 30-day period and the income earned by an injured person for work during the same period together shall not exceed $1,000.00 which maximum shall apply pro rata to any lesser period of work loss. The maximum shall be adjusted annually to reflect changes in the cost of living under rules prescribed by the commissioner but any change in the maximum shall apply only to benefits arising out of accidents occurring subsequent to the date of change in the maximum.” MCL 500.3107; MSA 24.13107.
Section 3110 defines those persons who are "dependents of a deceased person” for purposes of "survivor’s loss”. MCL 500.3110; MSA 24.13110.
Under the No-Fault Act, such "double recovery” of economic losses might occur with respect to the following persons:
(1) those persons who retain their right to sue for economic losses because they were injured by a motorist not insured under the act (see § 3135[2] of the act, which partially abolishes tort liability resulting from accidental motor vehicle injury only as to those persons who have complied with the mandatory security provision of the act, §3101).
(2) those persons who retain their right to sue for economic losses because they were injured in another state (see §.3135[2], which partially abolishes tort liability "arising from the ownership, maintenance or use within this state” of a motorist who has complied with the mandatory security provision of the act, § 3101).
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Ryan, J.
In bringing this appeal, the plaintiff-appellant raises important questions of first impression arising under the Michigan Adoption Code, MCLA 710.21 et seq.; MSA 27.3178(555.21) et seq., effective January 1, 1975. Appellant asks us to reverse the Court of Appeals affirmance of an order of the probate court terminating his parental rights, pursuant to the Adoption Code, to a child fathered by him and born out of wedlock on July 28, 1975. We conclude the probate court erred in finding that the best interests of the child mandated terminating appellant’s rights.
I
On July 29, 1975, one day after the birth of the child we will call Baby Boy Barlow, his mother, the appellee in this case, voluntarily placed him with an agency, Child and Family Services, Inc., with the ultimate goal of seeing him placed in a home for purposes of adoption. Temporary care of the child has been provided pending the outcome of these proceedings.
On September 4, 1975, a statutory petition for hearing to identify the child’s father and to determine or terminate his rights was filed in the Berrien County Probate Court and a copy was served on appellant.
On September 23, 1975, prior to the scheduled September 30 hearing on the petition, the appellant filed a petition admitting paternity and praying for custody of the child.
At the September 30 hearing, it was determined that the parties had no objection to the court determining that appellant was the father of the child. It was also agreed that appellant would begin making regular child support payments for the care and welfare of the infant. A further hearing was then scheduled for October 27, 1975 to take up the matter of custody.
At the October 27, 1975 hearing, appellant testified that he was 19 years of age and had known the child’s mother for approximately two years. He said that shortly after he learned that the appellee was expecting their child, he asked her to marry him. The parties eventually agreed to be married; a wedding was planned and finally can-celled.
During this period and until shortly before the child’s birth, the parties discussed and received counseling concerning custody of the boy or his being placed for adoption. Appellant desired custody of the child; the child’s mother preferred adoption. No resolution was reached.
Appellant admitted that he did not contribute to appellee’s medical expenses associated with the child’s birth or to the child’s support until after receiving the petition for hearing.
Appellant testified that he had graduated from high school in June of 1975, had been employed since June of 1974 and was a foreman on the second shift at a factory in the area, and for much of the same time had also been holding a second, part-time job. He had saved some money and had made tentative plans with his mother and sisters to care for the child during his working hours.
A number of witnesses then gave favorable testimony concerning appellant’s fitness to care for a child. Appellant then rested his case.
The appellee testified that she believed that the child’s best interests would be served by placing him for adoption. Her opinion was concurred in by others, including placement workers associated with Child and Family Services.
At the request of counsel, the matter was adjourned and during the succeeding months the parties attempted, without success, to amicably resolve the matter of custody.
At an additional hearing on June 8, 1976, appellant testified that he had, in the interim, purchased a home, that his earnings had increased, that he had been paying for the child’s care and that he had visited with the child as often as possible.
Child and Family Services, Inc. reported that the child had been transferred to a second foster home about four months after his birth.
On July 27, 1976, the court rendered its decision and terminated appellant’s parental rights.
An appeal as of right was taken to the Court of Appeals which remanded the case to the probate court for more specific findings of fact.
That probate court’s supplemental statement of findings recited that the father was not unfit to care for the child in the sense that term is used in cases involving abused, dependent or neglected children.
However, the court reaffirmed' its conclusion that it would not be in the best interests of the child to award custody to his father based on a finding that appellant could not properly care for the child, that no emotional ties had developed between the child and his father, that appellant was not inclined to raise the child in his religion and that it would be better for the boy to be adopted by his "foster parents”.
An order was entered terminating appellant’s parental rights. The probate court’s decision was affirmed by the Court of Appeals. In the Matter of Baby Boy Barlow, 78 Mich App 707; 260 NW2d 896 (1977). We granted leave to appeal. 402 Mich 856 (1978).
II
The time has long since passed when children born out of wedlock had no rights derived from their relationship to their natural parents and the parents had no rights with respect to their illegitimate children.
Justice (then Judge) Levin, writing for a panel of the Court of Appeals in In re Mark T, 8 Mich App 122; 154 NW2d 27 (1967), reviewed the early history of the common law concerning custody of illegitimates.
"Originally, in English law, the illegitimate child was the ward of the parish because, in one of the less charming fictions of our early common law, he did not exist.
" 'The common law of England did not contemplate illegitimacy and, shutting its eyes to the facts of life, described an illegitimate child as ñlius nullius.’ Galloway v Galloway (1955, HL), [1956] AC 299, 310, 311 (3 All Eng Rep 429, 431).” 8 Mich App 122, 136.
Consistent with the early common-law rule that the mother of a legitimate child had no custody rights, the illegitimate, considered incapable of having a father known to the law, was said to be a fílius nullius, the child of nobody, and a ward of the parish. Over time, the law developed to recognize custody rights to an illegitimate child, first of all in the mother only.
The general rule stated in the cases is that, as in the case of legitimate children, the mother is the natural guardian of her child and has a primary right to his or her custody, subject always to the child’s best interest. In re Mark T, supra; Anno: Right of mother to custody of illegitimate child, 98 ALR2d 417. See, also, In re Mathers, 371 Mich 516; 124 NW2d 878 (1963).
A number of courts have stated that, subject to the best interests of the child, after the mother the putative father of an illegitimate child has custody rights paramount to those of any other person. Caruso v Pima County Superior Court, 100 Ariz 167; 412 P2d 463 (1966); In re Baby Boy Shady, 264 Minn 222; 118 NW2d 449 (1962); Commonwealth ex rel Human v Hyman, 164 Pa Super 64; 63 A2d 447 (1949); In the Matter of Estate of Moore, 68 Wash 2d 792; 415 P2d 653 (1966). See, also, Anno: Right of putative father to custody of illegitimate child, 45 ALR3d 216. Recognition of a superior right to custody in the father has been justified as derivative of statutory obligations to support the child, see, e.g., In re State in Interest of Baby Girl M, 25 Utah 2d 101; 476 P2d 1013 (1970); In the Matter of the Guardianship of C, 98 NJ Super 474; 237 A2d 652 (1967); and as resulting from the court’s deference to natural family relationships, In the Matter of Fierro v Ljubicich, 5 Misc 2d 202; 165 NYS2d 290 (Supreme Ct, 1957).
Concerning illegitimate children, the courts have disagreed, as they have in disputes concerning legitimate children, over whether the best interests of the illegitimate child are served by granting custody to a natural parent rather than a third party unless the parent is shown to be unfit or whether the welfare of the child, irrespective of any showing of unfitness, should be the central matter for concern. In re Maria S Weldon, 397 Mich 225; 244 NW2d 827 (1976); Note: Alternatives to "Parental Right” in Child Custody Disputes Involving Third Parties, 73 Yale LJ 151 (1963).
Ill
The precise issue before us is termination of parental rights. We must look to the Michigan Adoption Code, supra, for guidance in the resolution of this matter.
In enacting the Adoption Code, the Legislature sought, inter alia, to establish procedures to provide for speedy resolution of disputes concerning a putative father’s rights where placement of an illegitimate child for adoption is sought. A putative father’s parental rights are subject to termination only after the father is afforded notice and an opportunity to be heard. MCLA 710.36; MSA 27.3178(555.36).
The Adoption Code also provides substantive standards for deciding when a putative father’s rights may appropriately be terminated. Section 39 of the code creates two categories of putative fathers and provides different standards for termination of the rights of each. Putative fathers who have established no custodial relationship with the child, and who have provided no support for the mother or child prior to the notice of hearing, may have their parental rights terminated if the court finds, after examining the father’s fitness and ability to properly care for the child, "that it would not be in the best interests of the child to grant custody” to him. The parental rights of the second group, those who have established some kind of custodial or support relationship prior to the notice of hearing, are subject to termination only by proceedings under the general jurisdictional provisions of chapter 12A of the Probate Code.
In the case before us, the probate court found that appellant had not established any custodial or support relationship prior to being served with notice of hearing, and thus was subject to suffer the termination of his parental rights if it would not be in the best interests of the child to grant custody to his father.
A
Prior to the enactment of the Adoption Code it had been held, in a case factually similar to the one at bar, that it is presumed that a child’s best interests lie with his natural parent’s exercise of custodial rights, absent a showing of that parent’s unfitness or of neglect or abandonment of the child, and that for purposes of making that determination, it is improper to compare the parental home with the proposed alternative. In the Matter of Robert P, 36 Mich App 497; 194 NW2d 18 (1971). This holding was consistent with this court’s settled precedent in custody cases which pitted the natural parents of legitimate children and unwed mothers against third parties. See In re Ernst, 373 Mich 337; 129 NW2d 430 (1964); In re Mathers, supra.
We think it is clear that, in creating two categories of putative fathers and subjecting those in appellant’s circumstances to having their parental rights terminated on a showing that it would not be in the best interests of the child to grant custody to the father, the Legislature rejected the view that cases like the one before us should turn upon a showing or failure to show that the putative father is unfit.
The probate court properly, then, continued its inquiry under § 39(1) after finding appellant not unfit.
B
The court next turned to a consideration of the appellant’s ability to properly care for the child and, in general, the child’s best interests. The findings of the court state:
"The court finds that the father does not have the ability to properly care for this child. The father is young, immature and unmarried. His care plan involves the extensive aid of his 18-year-old unmarried sister, a 22-year-old divorced sister and his mother, who would care for the child while he is working. The child would be cared for at various times in the paternal grandmother’s home, the divorced sister’s home and the father’s home with all three of them having child raising responsibilities. This plan is very nebulous as the [22-year-old re]married sister and the paternal grandmother testified that no plans for caring for the child had been worked out.
"The father has minimal knowledge of the fundamental requirements involved in raising a child and has had minimal experience in the full responsibility of child raising.”
Upon review of the entire record, it is our respectful conclusion that the court’s findings are not sustained by the evidence. GCR 1963, 517; In re Mathers, supra.
The court’s finding that appellant is unable to provide proper care for his child is simply without support in the record. Youth and marital status are not evidence of either an incapacity or disinclination to assure that a child will receive adequate care and supervision. The record does not disclose the kind of lack of maturity that would support a finding that appellant is unable to properly care for his child. Although appellant may have been possessed of only "minimal knowledge of the fundamental requirements involved in raising a child”, the record belies any suggestion that appellant is incapable of learning what most adult human beings quickly learn upon the birth of a first child.
Moreover, appellant’s plan for his mother and sisters to sit for the child cannot be deemed to be improper care.
Finally, to the extent the court’s finding suggests that the child will receive "better” care if placed for adoption, we find the court erred. Again, there is no substantial evidence in the record that would support such a conclusion. The court was unable to point to anything in the father’s situation that would make his home an unhealthy one for his child. See the remainder of the discussion under Part C, infra.
In the peculiar circumstances of this case, the competing parties are the child’s natural parents. The appellee-mother had proposed to execute a release terminating her own parental rights but had not done so at the time of the hearing, and the Adoption Code provides that a child may not be placed for purposes of adoption until the father’s rights are terminated by the court.* There is no evidence in the record concerning who the future adoptive family would be.
Consequently, the alternative home in which the parties’ child might someday be placed is unknown and unknowable. We are convinced that the possibility that there may be a better home somewhere, be it the natural mother’s or an adoptive one, yet unidentified and unidentifiable, is not evidence but rather mere speculation and conjecture that it would not be in the best interests of the child to award custody to his father.
Where the identity of the child’s ultimate home, if the father’s rights are terminated, is unknown, there is no way to evaluate what that family’s circumstances would offer. For example, it has been urged that adoptive placement in some two-parent family would be better for the child. However, while it might be assumed that an agency would place a child in a "typical” family in which the wife is not employed outside the home, and assuming without conceding that such circumstance is in terms of the child’s best interests, more desirable than one in which the mother works outside the home, there might be other aspects of that family’s situation, still unknown, that would weigh against this facially desirable characteristic. It is not unknown for adoptive placements to be unsuccessful. Without examining the prospective hypothetical family and the circumstances of its members, it would be impossible for the trial court to assess such family’s suitability to care for the child whose interest is here in question.
We should not lose sight of what is involved in this case. It is proposed that the state terminate a natural father’s parental rights, ultimately in favor of unrelated, unknown and unidentifiable third parties, indeed third parties whose existence is merely hypothetical. The task is, again, to determine if it has been proven that it would not be in the best interests of the child to place custody in the father.
It would be entirely unfair to require appellant to prove that an unknown home would not be a better one than that which he was prepared to provide. We cannot know whether the parent(s) in that home would be better suited to raising the infant whose interests are before us than his own father. We cannot assume, for example, that because families chosen for adoptive placements generally follow a more conventional lifestyle and have established more economic stability at a particular point in time than appellant has, they will always be better for a child. It is simply impossible to predict whether an infant would turn out to be a healthier, more well-adjusted person if raised by an unidentified family rather than his concededly fit biological relatives.
We conclude, therefore, that in the absence of evidence indicating appellant’s home would not be a good one for the child, as to this one of the elements comprising the totality of the child’s interests, there is no basis on the record in this case for finding that it would not be in the best interests of the child to award custody to his father.
C
The probate court continued its evaluation of the best interests of the child by considering the definition of that term in the Child Custody Act. MCLA 722.21 et seq.; MSA 25.312(1) et seq. The parties agreed that the act applied to this dispute and neither party now objects to its application.
By its terms, the custody act applies to circuit court custody disputes. See §§ 4, 6, 7a and 8. It does not apply to termination proceedings in the probate court in general which focus not on seeking to maximize a child’s interest by deciding which of two competing parties should be awarded custody, but rather on the circumstances of a parent, the termination of whose rights is sought. The Legislature has, however, set forth a number of areas of concern in that act which it deemed should be evaluated in a large category of inquiries into a child’s welfare. In distinguishing the class of fathers to which appellant belongs, the Legislature specified that determining whether an award of custody to the putative father would be in the child’s best interests is a central matter for concern. We find the factors comprising the best interests of the child contained in the Child Custody Act to be ones which the Legislature, case law and common sense would indicate ought likewise to be relevant in cases arising under § 39(1) of the Adoption Code. Accordingly, we find that the trial court properly looked to § 3 of the custody act for guidance in evaluating the best interests of the child in the case at bar.
Since, however, cases arising under § 39(1) of the Adoption Code may arise, as does this one, not in the context of two known disputing parties, application of the best interest test to these cases will differ from evaluation of the enumerated factors in the context of a typical dispute arising under the Child Custody Act.
The probate court found that as to a number of factors, an award of custody to appellant would serve the child’s best interests as well as the available alternatives. Appellee does not dispute these findings and we therefore find it unnecessary to review them.
With respect to two factors, consideration of which is intended to give weight to the desirability of maintaining the continuity of a stable environment, repeatedly recognized by leading authorities and case law as important to the well-being of a child, the court below found that it would not be in the child’s best interest to award custody to appellant. More specifically, as mentioned supra, it was found that the child had become emotionally bonded to his foster parents but that no viable family relationship had been established between appellant and the child and that it would be better for the child to be adopted by his foster parents.
A finding that it would not be in the best interests of the child to award custody to his natural father based on these considerations can find no support on this record.
As mentioned, there is no evidence that the child’s foster family would be its ultimate custodial one.
Concerning the problem of emotional bonds, on the record before it, the court was undoubtedly justified in finding that strong emotional ties had not been developed between the child and his father. Indeed, we might expect that the most common case arising under subdivision 1 of § 39 will be one in which the putative father has not been able to cultivate strong emotional ties with his child. In the case at bar, for example, the child was turned over by the mother, one day after his birth, to an agency for foster care, pending the outcome of these proceedings. Appellant has been able to visit the child at the agency offices weekly but has, unsurprisingly, not been able to cultivate strong emotional bonds on the child’s part. Appellant does have, however, the love and affection a natural father has for his child. He has sought, from the time he became aware of the child’s conception, to gain custody of his child.
It is urged by amicus curiae, Child and Family Services of Michigan, Inc., that although the record is void of specific testimony regarding the foster parents, the foster home provides a stable and satisfactory environment. We cannot disagree. The testimony of the director of the agency indicates, however, that at the time of the hearing there was a near certainty that the child would soon be transferred to a different home if the father’s rights were terminated.
In sum, there is no evidence to support the trial court’s findings that an award of custody to appellant would be any more disruptive to the child’s life than the available alternatives.
The lower court found finally that appellant showed no inclination to raise the child in his religion. The mother of the child is Roman Catholic and the child was baptized in that faith.
Inclusion of religious considerations in a best interests test may serve two purposes. For older children who unfortunately become the subjects of custody disputes, consideration of a party’s inclina tion to raise a child in the child’s religion serves to assure the continuity we have spoken of, providing, of course, the child is receiving some religious training or at least has some religious preference or affiliation. In the case of all children, including younger ones, consideration of religious factors serves to promote values highly prized in our society. We do not, however, believe that a mother’s preference that an infant child be raised in the mother’s own faith should be given controlling weight in deciding whether to terminate the natural father’s parental rights, all other things being equal.
For all of the foregoing reasons, the lower court’s conclusion that it would not be in the best interests of the child to award custody to appellant is not, therefore, supported by the record.
IV
In light of the foregoing, we find it unnecessary to reach appellant’s remaining contentions.
The order of the probate court terminating appellant’s parental rights is vacated. The case is remanded to the probate court for further proceedings not inconsistent with this opinion.
No costs.
Kavanagh, C.J., and Williams, Levin, Coleman, Fitzgerald, and Blair Moody, Jr., JJ., concurred with Ryan, J.
MCLA 710.36; MSA 27.3178(555.36).
Section 39 of the Adoption Code provides in part:
"(1) If the putative father is one who has not established any custodial relationship with the child or who did not provide any support or care for the mother during pregnancy or for either mother or child after the child’s birth until notice of the hearing was served upon him, and if the putative father appears at the hearing and requests custody of the child, the court shall inquire into his fitness and his ability to properly care for the child and shall determine whether the best interests of the child will be served by granting custody to him. If the court finds that it would not be in the best interests of the child to grant custody to the putative father, the court shall terminate his rights to the child.
"(2) If the putative father is one who has established a custodial relationship with the child or has provided support or care for the mother during pregnancy or for either mother or child after the child’s birth during the 90 days before notice of the hearing was served upon him, the rights of the putative father shall not be terminated except by proceedings in accordance with section 2 of chapter 12a.”
The case at bar is governed by subdivision (1) of § 39. See the discussion infra.
MCLA 710.65; MSA 27.3178(555.65).
In re Mark T, supra; Sovereign v Sovereign, 354 Mich 65; 92 NW2d 585 (1958).
Brewer v Blougher, 39 US (14 Pet) 178; 10 L Ed 408 (1840).
Rights of illegitimate children and their parents in matters beyond custody have continued to evolve. In Michigan, for example, an illegitimate child has a right to support from his parents and his father’s estate, MCLA 722.712; MSA 25.492; to inherit from his mother as if legitimate, MCLA 702.81; MSA 27.3178(151); and to inherit as if legitimate from his father following intermarriage of his parents or acknowledgement. MCLA 702.83; MSA 27.3178(153).
Illegitimate children as a class enjoy equal protection of the laws under a standard of judicial review which, although not of strictest scrutiny, "is not a toothless one”. Trimble v Gordon, 430 US 762, 767; 97 S Ct 1459; 52 L Ed 2d 31 (1977).
The interest of a putative father in his illegitimate child is one protected by due process of law. Stanley v Illinois, 405 US 645; 92 S Ct 1208; 31 L Ed 2d 551 (1972).
In re Ernst, 373 Mich 337; 129 NW2d 430 (1964); Sawyer v Sawyer, 312 Mich 524; 20 NW2d 295 (1945); Corrie v Corrie, 42 Mich 509; 4 NW 213 (1880).
The Adoption Code incorporates the decision in Stanley v Illinois, supra.
We agree with Justice Levin who wrote in In re Mark T:
"Although the proposed living arrangement described by Mr. S
would not have the organization one would expect in a home where there is both a mother and a father, as it would be necessary to hire housekeepers and to rely on family members for daytime supervision, this is not much different than the arrangement which prevails in many households where the mother works, is deceased, incapacitated, or the parents are separated or divorced and custody has been awarded to the father. A home is not rendered unsuitable merely because there is not a permanent mother or, for that matter, father figure in residence throughout the day.” (Citations omitted.) 8 Mich App 122, 150-151.
MCLA 710.31; MSA 27.3178(555.31).
Id.
It was testified that the child would in all probability not be placed for adoption in his then current foster home, but would rather be moved to some other situation not yet chosen at the time of the hearing.
See In re Mark T, supra.
In In re Weldon, supra, Justice Coleman made the following observations concerning the fitness-best interests controversy which are relevant to our discussion:
"The argument most frequently used for the 'fitness’ test is that such a consideration might result in a comparison of wealth, the respective luxury of homes and, in short, become solely a contest of economics. Indeed, this would become a tragedy for it is common knowledge that some wealthy homes are not healthy homes for children and would not serve their best interests.
"It is an effective technique to argue extremes, so the opposite position could be, for example, that third-party custody could turn upon the fact that the parent lives in a home without plumbing.
"The answer to both extremes is that neither condition in itself would be determinative. Many well-balanced, successful people have come from both financially rich and poor homes. Neither condition would be a core factor.
"The argument of comparative wealth sidetracks the real issue and even has the 'red herring’ effect of diverting attention from the most important factors to be considered.” 397 Mich 225, 266.
Section 3 of the Child Custody Act provides:
" 'Best interests of the child’ means the sum total of the following factors to be considered, evaluated and determined by the court:
"(a) The love, affection and other emotional ties existing between the competing parties and the child.
"(b) The capacity and disposition of competing parties to give the child love, affection and guidance and continuation of the educating and raising of the child in its religion or creed, if any.
"(c) The capacity and disposition of competing parties to provide the child with food, clothing, medical care or other remedial care recognized and permitted under the laws of this state in lieu of medical care, and other material needs.
“(d) The length of time the child has lived in a stable, satisfactory environment and the desirability of maintaining continuity.
"(e) The permanence, as a family unit, of the existing or proposed custodial home.
"(f) The moral fitness of the competing parties.
"(g) The mental and physical health of the competing parties.
"(h) The home, school and community record of the child.
"(i) The reasonable preference of the child, if the court deems the child to be of sufficient age to express preference.
"(j) Any other factor considered by the court to be relevant to a particular child custody dispute.”
In re Weldon, supra; opinion of Coleman, J., 397 Mich 225, 264; opinion of Levin, J., 397 Mich 225, 326-327.
The court found the alternatives offered for placement of the child would equally well serve the child’s needs for love, affection and guidance (§ 3[b] of the custody act); food, clothing and medical care (§ 3[c]); permanence in the custodial home (§ 3[e]); and moral fitness and mental and physical health in the custodial parties (§ 3, subds [f|, fe])-
In In re Weldon, supra, Justice Coleman quoted the following from Henry H. Foster, Jr., Adoption and Child Custody: Best Interests of the Child?, 22 Buff L Rev 1, 12-13 (1972):
"Although the article speaks to revocation of adoption consent, the following is pertinent:
" 'Recent decisions in other states indicate an increasing acceptance of generally recognized theories of child development. It has been recognized that the psychological parent-child relationship is more important than biological parenthood and that true mother love entails the care and nurture of a child, rather than an empty sentiment. Ordinarily, the best psychological interests of a child require continuity and consistency in the parent-child relationship. Removing a child from the warmth and security of the place he knows as home should be done only in the most compelling circumstances.’ ”
See, also, Note: Alternatives to "Parental Right” in Child Custody Disputes Involving Third Parties, supra.
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Fitzgerald, C.J.
This case requires us to construe certain exclusion clauses in the comprehensive general liability insurance policy purchased from defendant by plaintiffs. We hold that the policy did not provide coverage for the claims at issue and that defendant insurance company, therefore, is not liable to indemnify plaintiffs. Accordingly, the judgment of the Court of Appeals is reversed.
I
Plaintiffs are builders who, beginning in 1968, purchased comprehensive general liability policies from defendant insurance company in connection with the development of a residential area called White Oaks Subdivision. Plaintiffs subsequently contracted with William and Delphine Harding for the construction of a house on one of the subdivision lots.
According to the parties’ stipulation of facts, the Hardings alerted plaintiffs to an accumulation of water in the basement of the house after the foundation was laid, but before the structure was finished. Nonetheless, the house was completed and the transaction closed in November, 1970.
Almost immediately after moving into their new dwelling, the Hardings began experiencing difficulties with excess water in the basement. Gradually the foundation began to deteriorate; the concrete floor collapsed and the walls caved in. Plaintiffs attempted repairs over several years, ultimately installing a replacement drainage system in early 1976.
According to the parties’ stipulation, the standard drain tile material that had been used when the house was built was inadequate because the ground condition was abnormal. Sand, some of which came from beneath the footings, flowed into the drainage system through an opening and was carried away. This gradually undermined the substructure. The replacement "poroswall” system remedied the difficulty.
The Hardings eventually sued plaintiffs, alleging breaches of warranties regarding the quality of their lot and fitness of their house, as well. as personal injury (emotional upset). Plaintiffs notified defendant insurance company, which agreed to participate in the suit on the condition that all rights be reserved under its contract with plaintiffs. After several days of trial, a settlement was reached in which plaintiffs and defendant each paid the Hardings $25,000.
A provision of the settlement was that the dispute between plaintiffs and defendant over insur anee coverage be resolved through a motion for declaratory relief. Plaintiffs subsequently initiated such an action. The trial court found in plaintiffs’ favor on cross motions for summary judgment, and the Court of Appeals affirmed. 97 Mich App 584; 296 NW2d 112 (1980). This Court granted leave to appeal. 411 Mich 900 (1981).
II
It is helpful initially to understand the history and format of the policy under consideration. The first standardized comprehensive general liability policy was drafted more than 40 years ago, with most casualty companies adopting such forms after World War II. Revisions occurred in 1943, 1955, 1966 and 1973. Such a standard policy was in use in 1968 when plaintiffs began purchasing insurance from defendant in connection with the White Oaks Subdivision project.
Although the standard form is called a "general liability automobile policy”, it includes basic definitions, conditions and other materials that apply to liability policies in general. This "jacket”, together with standard inserts called "coverage parts”, forms the complete policy. The inserts spell out the specific protection purchased by the insured.
The particular policy under consideration in this case is a multiple-page document on legal-size paper. The first two pages contain "declarations”, information such as the plaintiffs’ address, the policy period, liability limits and premium charges.
The coverage details at issue in this case begin on the third page. Four main categories are listed at the top:
I. Coverage A — Bodily Injury Liability
Coverage B — Property Damage Liability
II. Persons Insured
III. Limits of Liability
IV. Policy Period: Territory
It is with category I that this case primarily is concerned. Category I begins with a general statement of coverage.
"The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of
A. bodily injury or
B. Property damage
to which this insurance applies, caused by an occurrence, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but the company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of the company’s liability has been exhausted by payment of judgments or settlements.”
The parties have stipulated that at all times relevant, the policy was in force. They further agree that under the basic coverage statement, defendant would be liable to plaintiffs for the damages which the Hardings claimed.
The next segment of the policy is entitled "Exclusions”. There are 15 such exceptions to coverage and several have been debated in the course of this lawsuit. The parties’ disagreement now centers on the effect to be accorded three of the exclusions. The entire section is preceded by the statement: "This insurance does not apply:
"(a) to liability assumed by the insured under any contract or agreement except an incidental contract; but this exclusion does not apply to a warranty of fitness or quality of the named insured’s products or a warranty that work performed by or on behalf of the named insured will be done in a workmanlike manner;
"(k) to bodily injury or property damage resulting from the failure of the named insured’s products or work completed by or for the named insured to perform the function or serve the purpose intended by the named insured, if such failure is due to a mistake or deficiency in any design, formula, plan, specifications, advertising material or printed instructions prepared or developed by any insured; but this exclusion does not apply to bodily injury or property damage resulting from the active malfunctioning of such products or work;
"(m) to property damage to work performed by or on behalf of the named insured arising out of the work or any portion thereof, or out of materials, parts or equipment furnished in connection therewith”.
It is apparent from a reading of the above that not only are there exclusions to coverage, but there are exceptions to the exclusions.
This Court recently reiterated that "[a]ny clause in an insurance policy is valid as long as it is clear, unambiguous and not in contravention of public policy”. Raska v Farm Bureau Mutual Ins Co of Michigan, 412 Mich 355, 361-362; 314 NW2d 440 (1982). The Raska majority noted that the only pertinent question was "whether the exclusionary clause in this contract is ambiguous, for if it is not ambiguous we are constrained to enforce it”.
As stated by the Eighth Circuit Court of Appeals, "An insurance company may, with the insured’s acceptance, insert as many exclusion clauses in its liability policy as it deems proper or necessary as long as they do not conflict with public policy or the statutory law”. Biebel Brothers, Inc v United States Fidelity & Guaranty Co, 522 F2d 1207, 1210 (CA 8, 1975).
These statements emphasize that freedom of contract is a much- and long-revered doctrine in American jurisprudence. When examining the language of this or any other insurance policy, we are mindful of several other principles of construction so rudimentary as to be axiomatic:
The contract should be viewed as a whole.
The intent of the parties should be given effect.
An interpretation of the contract which would render it unreasonable should be avoided.
Meaning should be given to all terms.
Ambiguities should not be forced.
Conflicts among clauses should be harmonized.
The contract should be viewed from the standpoint of the insured.
The insurer should bear the burden of proving an absence of coverage.
The use of standard policies presents a unique situation in which the precise language we are asked to analyze already has been interpreted by courts in other jurisdictions. The existence of so many opinions is both an advantage and a disadvantage. The benefit, of course, is the insight provided by learned jurists in other states and in the federal courts. The danger is that weight unfairly may be accorded a view merely because it has withstood attack for a period of time or because it is embraced by the majority of jurisdictions.
Ill
We turn now from these prefatory remarks to examine more closely the disputed exclusionary clauses. We note that coverage under the policy is lost if any one exclusion is applicable to the claims at issue. B A Green Construction Co, Inc v Liberty Mutual Ins Co, 213 Kan 393; 517 P2d 563 (1973).
It is reasonable to assume that an insured reading the policy exclusions would begin with the first and ask, "What coverage is omitted by this provision?” The insured then would assess whether the deleted coverage was necessary to its venture, a construction project in the case of plaintiffs. If the answer were "yes”, the insured then would attempt to reinstate coverage. This procedure would have to be followed in turn for each exclusion. Should a question arise concerning any of the clauses, the prudent insured would discuss it with the insurer. The record in this case is bereft of evidence that such a discussion took place.
The assumption, of course, is that the insured read the policy.
"[T]he expectation that a contract will be enforceable other than according to its terms surely may not be said to be reasonable. If a person signs a contract without reading all of it or without understanding it, under some circumstances that person can avoid its obligations on the theory that there was no contract at all for there, was no meeting of the minds.
"But to allow such a person to bind another to an obligation not covered by the contract as written because the first person thought the other was bound to such an obligation is neither reasonable nor just.” Raska v Farm Bureau Mutual Ins Co of Michigan, 412 Mich 355, 362-363; 314 NW2d 440 (1982).
Our task then is to ascertain whether the insured reasonably should have known at the time it purchased the insurance policy that it was not protected from liability for damages such as occurred in this case. Hindsight may be a great teacher, but it cannot be our observation point for this purpose.
We begin with exclusion (a), which would omit coverage for any liability plaintiffs assumed under a contract with a third party except an incidental contract. This would remove coverage for damages under the contract between plaintiffs and the Hardings, were it not for the exception to exclusion (a). The exception reinstates coverage where liability stems from "a warranty of fitness or quality of the named insured’s products or a warranty that work performed by or on behalf of the named insured will be done in a workmanlike manner”. The parties have stipulated that due to this exception, plaintiffs would have been covered for the claims at issue if exclusion (a) were the only provision to consider.
Plaintiffs would accord the exception to exclusion (a) far greater status, however. The exception is tantamount to a grant of coverage and cannot be canceled by another provision, plaintiffs assert. Further, they insist that an attempted deletion would create such ambiguity as to require that the policy be enforced under plaintiffs’ interpretation.
We disagree, for to adopt plaintiffs’ logic would require us to ignore the principle that exclusionary clauses never grant coverage, but rather limit the scope of the basic protection statement. " '[E]ach exclusion is meant to be read with the insuring agreement, independently of every other exclusion. The exclusions should be read seriatim, not cumulatively. There is no instance in which an exclusion can properly be regarded as inconsistent with another exclusion, since they bear no relationship with one another.’ ” Weedo v Stone-E-Brick, Inc, 81 NJ 233, 248; 405 A2d 788 (1979).
Therefore, since we find that the exception to exclusion (a) is not a grant of coverage, it is necessary to examine independently exclusions (k) and (m). The parties have devoted most of their attention to exclusion (m). However, we will address the two exclusions in order because that is how an insured reasonably would approach them, and also because exclusion (k) affects both the property damage and bodily injury (emotional upset) claims.
The language of exclusion (k) pertinent to this case provides that there is no coverage for damage due to "failure of the named insured’s products or work completed * * * to perform the function or serve the purpose intended by the named insured, if such failure is due to a mistake or deficiency in any design, formula, plan, specifications”. The parties seem to agree that the damages caused by the inadequate drainage system would be excluded under this language. However, exclusion (k) also has an exception, and there is no agreement between the parties as to its effect. The exception reinstates coverage for bodily injury or property damage which results from the active malfunctioning of the insured’s products or work.
Early commentators suggested that this provision would be difficult to apply. The concept of "active malfunctioning” necessarily implicates the concept of "passive malfunctioning”, one author noted. "Having long wrestled with active versus passive negligence concepts, we may now enter a new arena of active versus passive malfunctioning.” Tarpey, The New Comprehensive Policy: Some of the Changes, 33 Ins Counsel J 223, 226 (1966).
Several illustrations were offered in an attempt to clarify the matter. Three widely quoted examples are the insecticide which failed to kill pests (passive) versus the insecticide which killed both pests and crops (active); the hair tonic which failed to prevent loss of hair (passive) versus the hair tonic which caused a skin rash (active); and the rust preventive which failed to stop rust (passive) versus the rust preventive that corroded a radiator (active). American Employers’ Ins Co v Maryland Casualty Co, 509 F2d 128, 130 (CA 1, 1975).
American Employers’ itself involved damages caused by the structural weakness of a floor in a municipal building. The Court held that this was due to design and akin to the hair tonic which failed to prevent baldness; therefore, there was no coverage.
Another example from the construction industry involves a structural collapse due to insufficient strength of a steel beam. If the beam used had been purposely selected by the insured, there would be no coverage. However, if the insured had chosen an adequate beam, but workmen put in the wrong one by mistake, there would be coverage. Gowan, Completed Operations and Products Liability Insurance Coverage of the New Comprehensive General-Automobile Policy, ABA Section of Insurance, Negligence and Compensation Law Proceedings — 1965-1966, p 276.
We do not believe it necessary to engage in this type of semantic sparring. Plaintiffs do not contend that the drainage system installed in this case was other than the one selected; the difficulty was that an inappropriate system had been chosen. Further, "malfunctioning” means functioning badly, not merely not performing as intended or designed. Id. There is no indication in the record that the drain tile system in this case "malfunctioned” at all. To the contrary, the system performed as intended by carrying away material. The problem was that sand as well as water entered the system. The damage, therefore, was due to the incompatibility of the drainage system and the abnormal ground condition, but was not caused by the system itself. The "error” was in design, plan or specification, to which exclusion (k) applies. The exception to exclusion (k) cannot reinstate coverage because there was no malfunction, active or otherwise.
We continue our discussion by examining exclusion (m), even though our interpretation of exclu sion (k) means that the insured was not protected against the claims in this case under its insurance contract with defendant. We choose to address exclusion (m) because the wording of exclusion (k) was changed radically in 1973 (see fn 6), and also because this Court has not analyzed this provision previously. Provision (m) excludes coverage for damage to "work performed” if the damage is due to "the work or any portion thereof’ or "materials, parts or equipment furnished in connection therewith”. Exclusion (m) has no exception, and we already have rejected plaintiffs’ contention that the provision cannot apply because the exception to exclusion (a) either grants coverage or creates an ambiguity.
There has been much ado about the meaning of the terms "work performed” and "work” in exclusion (m), but a resolution of that debate is not necessary to this case. Whether the terms refer to work under way or completed work, a plain reading of the provision would result in a denial of coverage where damage is caused by the work itself or any materials, parts or equipment used in the project. In other words, this is a classic example of an insurer denying liability when the insured itself is negligent or otherwise responsible for damage to the project. Whether viewed from the perspective of a faulty product or from the perspective of faulty workmanship, the damage in this case which arose from the installation of the inappropriate drainage system would fall outside the scope of plaintiffs’ policy. "If exclusion (m) does not apply to the facts before us, it is completely meaningless.” Biebel Brothers, Inc v United States Fidelity & Guaranty Co, 522 F2d 1207, 1211 (CA 8, 1975).
Plaintiffs have complained that if the implied warranty situations carved out by the exception to exclusion (a) do not create a grant of coverage, the exception is meaningless. This view fails to recognize that exclusion (m) does not remove coverage when property other than the work product itself is damaged due to problems with the product itself, materials or workmanship. The insured only is required to absorb the cost of replacement or repair of its own work where the damage arises out of the work.
"The products hazard and completed operations provisions are not intended to cover damage to the insured’s products or work project out of which an accident arises. (Citation omitted.) The risk intended to be insured is the possibility that the goods, products or work of the insured, once relinquished or completed, will cause bodily injury or damage to property other than to the product or completed work itself, and for which the insured may be found liable. The insured, as a source of goods or services, may be liable as a matter of contract law to make good on products or work which is defective or otherwise unsuitable because it is lacking in some capacity. This may even extend to an obligation to completely replace or rebuild the deficient product or work. This liability, however, is not what the coverages in question are designed to protect against. The coverage is for tort liability for physical damages to others and not for contractual liability of the insured for economic loss because the product or completed work is not that for which the damaged person bargained.” Henderson, Insurance Protection for Products Liability and Completed Operations — What Every Lawyer Should Know, 50 Neb L Rev 415, 441 (1971).
Thus, even if plaintiffs had purchased completed operations and products liability coverage, the "business risk” exclusions would bar protection from the damages the Hardings claimed.
IV
In summary, we hold that plaintiffs did not have coverage under the comprehensive general liability insurance policy they purchased from defendant for damages which arose out of a construction effort and which were confined to the building itself. Further, plaintiffs were not insured against bodily injury claims where the damages stemmed from a planning error and were not the result of an active malfunction. In our view, the disputed exclusionary provisions in the insurance contract between plaintiffs and defendant were unambiguous in deleting coverage for occurrencés of this sort.
"It is scarcely just either to deprive a purchaser of the protection he is entitled to receive or to extend one type of coverage to. fit a completely different situation from that contemplated.” 7A Appleman, Insurance Law and Practice, § 4508, p 335.
Reversed and remanded.
Coleman and Ryan, JJ., concurred with Fitzgerald, C.J.
Kavanagh, J.
(for affirmance). Although we agree that the insurance policy may reasonably be construed to exclude coverage, we do not agree that such is the only reasonable interpretation. Another reasonable interpretation is set' forth by Judge Beasley in his opinion for the Court of Appeals, 97 Mich App 584; 296 NW2d 112 (1980). This interpretation affords Coverage.
A contract is ambiguous when its words may reasonably be understood in different ways. Raska v Farm Bureau Mutual Ins Co of Michigan, 412 Mich 355, 362; 314 NW2d 440 (1982). If, fairly read, the entire contract of insurance leads one to understand that there is coverage under particular circumstances and another fair reading leads to an understanding of no coverage under the same circumstances, the contract is ambiguous and should be construed against its drafter and in favor of coverage. Id.
Since we find that this insurance contract yields two conflicting reasonable interpretations, it is ambiguous and we construe it in favor of coverage.
The judgment of the Court of Appeals is affirmed.
Williams and Levin, JJ., concurred with Kavanagh, J.
The late Justice Blair Moody, Jr., took no part in the decision of this case.
Insurers contend that by proceeding this way they achieve standardization and efficiency in underwriting operations. "[B]ut to those not familiar with the relationship, and nonrelationship, of the different parts of this type of policy arrangement, it appears to be a successful attempt at obfuscation by insurers.” Henderson, Insurance Protection for Products Liability and Completed Operations — What Every Lawyer Should Know, 50 Neb L Rev 415, 419, fn 12 (1971).
The policy submitted to the Court consists of eight unnumbered pages. The first in order is entitled Part B General Liability Automobile Policy Declarations, while the fourth in order is entitled Policy Provisions — Part A. A statement at the bottom of the first page notes that "This Part B, With 'Policy Provisions — Part A’, and Coverage Part(s) and Endorsement(s), (if any), Issued to Form a Part Thereof, Complete(s) the Above Numbered Policy.”
The comprehensive general liability policy purchased by plaintiffs did not include products liability and completed operations coverage. Although that protection was available, it was not automatically included. "On the contrary, this coverage has to be specifically purchased by the insured by so electing on the face of the policy or by purchasing an endorsement which either adds the coverage to or deletes the exclusion of the coverage under the basic policy.” Henderson, Insurance Protection for Products Liability and Completed Operations — What Every Lawyer Should Know, 50 Neb L Rev 415, 418 (1971). The first page of plaintiffs’ policy shows an advance premium paid for comprehensive general liability insurance, but the premium spaces are blank next to the option marked completed operations and products liability insurance. There also is no indication that plaintiffs secured an endorsement. Even if plaintiffs had purchased such coverage, however, it would not have aided them in this case because the disputed exclusionary provisions also limit the circumstances under which completed operations and products liability coverage exists. (See later discussion in part III.) The case law is somewhat confusing on this point because many opinions have not distinguished between those situations in which an insured has the completed operations-products liability coverage and those situations in which no such coverage has been purchased. See, for example, Indiana Ins Co v DeZutti, 408 NE2d 1275 (Ind, 1980), where the insured had paid a premium for "completed operations hazard” and "products hazard” insurance, and LaMarche v The Shelby Mutual Ins Co, 390 So 2d 325 (Fla, 1980), where the insured had only a comprehensive general liability policy.
Apparently the wording of exceptions in the 1966 revised policy was not foreseen as creating any misimpression that there was a grant of coverage. In fact, the language was anticipated to have just the opposite effect. "Present [prior to 1966] policies contain exceptions from the exclusions which led courts in some jurisdictions to conclude that an exception from an exclusion * * * was a grant of coverage. This was not the intent of the insurers. Under the new policy exceptions are stated thus,.'but this exclusion does not apply to;’ this unambiguous language avoids any inference that another exclusion may not apply.” 3 Long, The Law of Liability Insurance, § 10, p App-41.
Plaintiffs contend that even if exclusion (m) were found to delete coverage for the property damage claims, it does not affect personal injury claims. Therefore, it still would be necessary to address exclusion (k). This is so, say plaintiffs, because the Hardings’ suit against plaintiffs was settled and it is not apparent what portion of the settlement was for the property damage claims and what portion was for the personal injury (emotional upset) claim.
The commentators point out that the distinction in exclusion (k) as it read in 1966 was between performance failure or "production” error, for which there was coverage, and "design” error, for which there was no coverage unless damage was due to an active malfunction. The language was completely revised in 1973, broadening coverage and removing the production-design error distinction as well as the "active malfunctioning” concept. The 1973 revision reads:
" 'This policy does not apply to loss of use of tangible property which has not been physically injured or destroyed resulting from (1) a delay in or lack of performance by or on behalf of the named insured of any contract or agreement, or (2) the failure of the named insured’s products or work performed by or on behalf of the named insured to meet the level of performance, quality, fitness or durability warranted or represented by the named insured; but this exclusion does not apply to loss of use of other tangible property resulting from the sudden and accidental physical injury to or destruction of the named insured’s products or work performed by or on behalf of the named insured after such products or work have been put to use by any person or organization other than an insured.’ ” 2 Long, The Law of Liability Insurance, § 11.10, pp 11-57 through 11-58.
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Fitzgerald, C.J.
We are asked to determine whether defendants violated the Freedom of Information Act, MCL 15.231 et seq.; MSA 4.1801(1) et seq., by denying plaintiff’s request for a copy of the magnetic tape used to produce the Michigan State University student directory. We hold that such denial was proper, and therefore affirm the decision of the Court of Appeals.
I
In September, 1978, plaintiff Lawrence Kestenbaum sought from defendants Michigan State Uni versity and Dale Arnold, the university’s designated freedom of information officer, a duplicate of the computer tape used to produce the directory of students attending the school. Plaintiff contended that he was entitled to the tape under the Freedom of Information Act (hereinafter FOIA). Plaintiff stated that he wanted the tape to facilitate political mailings in connection with the November, 1978, election.
Defendants refused the request, offering instead to give plaintiff either a copy of the directory as soon as it was available, or an immediate printout of the information on the tape. The university asserted that its position was supported by the FOIA, specifically the provision exempting from disclosure information within the scope of the Family Educational Rights and Privacy Act of 1974, 20 USC 1232g.
Plaintiff subsequently filed suit in Ingham Circuit Court. On October 18, 1978, the trial court ordered defendants to create a duplicate magnetic tape for plaintiff’s use, deleting all information on the original except names and addresses of students. The trial court further directed that plaintiff make no use of the tape other than for political mailings, and that plaintiff return the tape after the election. Plaintiff was denied attorney fees, costs, disbursements or damages because the trial court concluded that defendants’ refusal had not been arbitrary or capricious, and that the case presented a valid question of first impression with substantial effects on the rights of third persons.
Plaintiff appealed the denial of attorney fees and costs. Defendants filed a cross appeal on the issues of whether the students’ names and addresses were exempt from disclosure under the Family Educational Rights and Privacy Act, and whether a public body is required under the FOIA to release for a nominal cost items of proprietary interest owned by the public.
The Court of Appeals affirmed the denial of attorney fees and costs, but reversed the trial court’s finding that plaintiff was entitled to a tape of the students’ names and addresses. Kestenbaum v Michigan State University, 97 Mich App 5; 294 NW2d 228 (1980). The Court did not rely upon the Family Educational Rights and Privacy Act, however, but rather upon § 13(1)(a) of FOIA, MCL 15.243(1)(a); MSA 4.1801(13)(1)(a), which protects against a "clearly unwarranted invasion of an individual’s privacy”. The Court further stated that release of the computer tape would contravene the constitutional prohibition against public funds being used to support a private purpose. Const 1963, art 9, § 18. Plaintiff’s application for rehearing was denied.
This Court granted leave to appeal. 411 Mich 869 (1981).
II
Freedom of information acts were passed by Congress and the various state legislatures in response to public concern over bureaucratic abuses and secrecy. The federal act preceded its Michigan counterpart by some ten years and served as a model for the state legislation. The thrust of both versions is a policy of disclosure.
Under the state act, a public body is required to disclose a public record upon request unless the record falls within the scope of certain enumerated exceptions. The terms "public body” and "public record” are defined in the preliminary sections of the FOIA.
There is no question that Michigan State University is a public body, having been "created by state or local authority or which is primarily funded by or through state or local authority”. FOIA § 2(b)(iv), MCL 15.232(b)(iv); MSA 4.1801(2)(b)(iv). A list of students appears to be a public record, i.e., "a writing prepared, owned, used, in the possession of, or retained by a public body in the performance of an official function, from the time it is created”. FOIA § 2(c). Further, the term "writing” specifically includes a magnetic tape. FOIA § 2(e).
It is important to note at this point that a significant difference between Michigan’s FOIA and the federal precursor is that the state act begins with a preamble which sets forth legislative intent:_
"It is the public policy of this state that all persons are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and public employees, consistent with this act. The people shall be informed so that they may fully participate in the democratic process. MCL 15.231(2); MSA 4.1801(1)(2).” (Emphasis added.)
Thus, each provision of the FOIA must be read so as to be consistent with the purpose announced in the preamble.
Whether a list of students is the kind of information envisioned by the Legislature as appropriate for disclosure is debatable, but such a determination is not necessary to our holding in this case.
By accepting without deciding that the list of students qualifies as a public record, we necessarily turn our focus to the enumerated exemptions. The posture of plaintiffs inquiry then becomes whether Michigan State University, a public body in possession of a public record, to wit, a magnetic tape, was authorized under the FOIA to deny disclosure.
We hold that the university was justified in denying plaintiffs request because the release of the magnetic tape containing the names and addresses of students would run afoul of the exemption set forth in § 13(l)(a) — information of a personal nature where the public disclosure of the information would constitute a clearly unwarranted invasion of an individual’s privacy.
In fact, despite the wording of § 13, which seems to make withholding of exempt information discretionary with the public body, the university arguably would not have been justified if it had granted plaintiffs request. It is logically persuasive that the public policy implicit in the exemp tions only can be served if nondisclosure prevails in those situations described in § 13.
Ill
The concept of privacy is elusive. Social scientists and legal scholars alike have struggled for a definition expansive enough to include important concerns and yet narrow enough to be workable.
Privacy as an existential condition must be distinguished from a legally cognizable right to privacy. The "right to privacy” has been described at various times as stemming from either property or trust theories or as flowing from certain constitutional guarantees or a penumbra thereof. This right, whatever its source, was labeled by Justice Cooley as "the right to be let alone”.
As society has expanded and distance contracted because of advances in communication and travel, the right to privacy for many has become the ability to choose with whom and under what circumstances they will communicate.
Obviously, not every interest of every person rises to a level which the law can or should protect. However, despite changing attitudes and changing laws, there has remained throughout this country’s legal history one recognized situs of individual control — the dwelling place. Without exception, this bastion of privacy has been afforded greater protection against outside assaults than has any other location. The United States Supreme Court on many occasions has re-emphasized the reverence with which the law views the private domicile.
These prefatory remarks serve to illustrate that any intrusion into the home, no matter the purpose or the extent, is definitionally an invasion of privacy. A fortiori, the release of names and ad dresses constitutes an invasion of privacy, since it serves as a conduit into the sanctuary of the home.
The United States Supreme Court has refused to endorse the idea that such an intrusion is so minimal as to be inconsequential.
"We therefore categorically reject the argument that a vendor has a right under the Constitution or otherwise to send unwanted material into the home of another. If this prohibition operates to impede the flow of even valid ideas, the answer is that no one has a right to press even 'good’ ideas on an unwilling recipient. That we are often 'captives’ outside the sanctuary of the home and subject to objectionable speech and other sound does not mean we must be captives everywhere. * * * The asserted right of a mailer, we repeat, stops at the outer boundary of every person’s domain.” Rowan v United States Post Office Dep’t, 397 US 728, 738; 90 S Ct 1484; 25 L Ed 2d 736 (1970).
It does not suffice, however, to merely label the release of names and addresses in this case an invasion of privacy. In order to come under exemption (l)(a) of § 13, the information must be of such a nature that "the public disclosure of the information would constitute a clearly unwarranted invasion of an individual’s privacy”.
The similarity between the FOIA and the federal act invites analogy when deciphering the various sections and attendant judicial interpretations. The exemption in the federal FOIA most similar to exemption (l)(a) of § 13 provides for the withholding of "personnel and medical files and similar files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy”. 5 USC 552(b)(6).
The wording of the federal exemption ostensibly makes it more narrow than the state exemption. Furthermore, it must be remembered that the overlay of legislative intent articulated in the preamble to the FOIA is not present in the federal act.
The federal act does not require persons seeking information to explain how they will use the material. It generally has been accepted, however, that where the requested information might fall under the federal privacy exemption, a balancing test must be employed, i.e., the public interest in disclosure must be weighed against the potential invasion of privacy.
The United States Supreme Court, in an opinion signed by five justices, has endorsed the balancing approach in the FOIA privacy exemption cases. Dep’t of the Air Force v Rose, 425 US 352, 372; 96 S Ct 1592; 48 L Ed 2d 11 (1976). "Congress sought to construct an exemption that would require a balancing of the individual’s right of privacy against the preservation of the basic purpose of the Freedom of Information Act 'to open agency action to the light of public scrutiny.’ ” The Court quoted from S Rep No 813, p 9: " 'The phrase "clearly unwarranted invasion of personal privacy” enunciates a policy that will involve a balancing of interests between the protection of an individual’s private affairs from unnecessary public scrutiny, and the preservation of the public’s right to governmental information.’ ” Id. It is not clear precisely what comprises the public interest to be weighed in any given instance.
Only a few courts have considered specifically whether names and addresses come under the protection of the federal privacy exemption. The usual approach in those cases has been to balance the privacy interest against the public benefit to be realized from the particular use intended by the person seeking the information. See, for example: Wine Hobby USA, Inc v United States Internal Revenue Service, 502 F2d 133 (CA 3, 1974), and Getman v NLRB, 146 US App DC 209; 450 F2d 670 (1971).
The drafters of the state FOIA similarly did not include language which would compel those seeking information to divulge their reasons for doing so. However, legislators recognized that the release of certain information could constitute a "clearly unwarranted” invasion of privacy and should not be required; thus, it also is necessary under the state act to balance interests.
It is important initially to designate the interests that are to be juxtaposed under § 13(l)(a) of the state act. Each side of the scales is to be measured with respect to the nature of the information requested. If the information is such that its release would be an invasion of privácy, however minimal, balancing is required. This means that potential harm from the invasion must be weighed alongside potential benefits to the public from disclosure.
The reason the information is sought in a specific instance is not a controlling factor. It is permissible to define the public interest in disclosure by referring to the uses contemplated by some members of the public, but not by exclusively focusing on the intention of the person requesting the information. If release of the material would be consistent with the legislative intent articulated in the preamble of the FOIA, and if the public interest would be sufficiently served, the scales tip in favor of disclosure. The only effective counterbalance would be a determination that, despite the potential benefits of public disclosure, the resulting privacy violation could not be justified because it would be "clearly unwarranted”.
As the First Circuit Court of Appeals noted when reviewing a privacy exemption case under the federal act, "[W]e do not believe that the capability of the individual requester is a proper subject of inquiry * * * any more than his relative degree of need for or interest in the information.” Kurzon v Dep’t of Health & Human Services, 649 F2d 65, 68, fn 2 (CA 1, 1981).
Another reason why a specific purpose cannot serve as a catalyst nor an impediment to disclosure is because there is no mechanism in the FOIA by which use can be restricted once a public body has permitted release. Only those requests which are reviewed de novo by the courts become subject to such limitations. Therefore, once it is deter mined that disclosure of certain information would result in a clearly unwarranted invasion of privacy, a further inquiry into intended use serves no purpose.
In the case at bar, for instance, the trial court held that because plaintiff would use the magnetic tape information in conjunction with an election campaign, the invasion of privacy was justified. Conversely, the Court of Appeals labeled the intended use a commercial one, not sufficient to neutralize the potential harm which would result from an invasion of privacy. Such differences in categorization underscore our point.
Conscious that the basic thrust of the FOIA was to be a policy of disclosure, the Legislature placed upon the public body denying a request the burden of justifying its decision. At no time is one seeking the information required to prove entitlement. As we stated, a particular intended use is irrelevant. The Court of Appeals was incorrect, therefore, in concluding that plaintiff was obliged to show that the public interest in release outweighed the possibility of harm to the people involved. It was up to Michigan State University to prove that the information was exempt from the general rule of disclosure.
We note, parenthetically, that the courts of this state, long before the enactment of the FOIA, recognized that citizens have a general right of free access to, and inspection of, public records. See Booth Newspapers, Inc v Muskegon Probate Judge, 15 Mich App 203; 166 NW2d 546 (1968), and the cases cited therein.
IV
Plaintiff has argued that by making the information available in a printed directory, the university sacrificed any privacy interests that may have existed.
However, we think that the university’s decision to publish the directory did not control the later decision to invoke exemption (l)(a) as to the magnetic tape.
Implicit in the university’s decision to publish the printed directory was its conclusion that the attendant invasion of privacy was not clearly unwarranted. Such a determination was reasonable.
In September, 1978, the student body numbered approximately 44,000 persons, a population comparable to that of the City of Muskegon. As it had done in past years, the university compiled a student directory to ease communications within the campus community and with those outside. The availability of the directory likely prevented a great deal of havoc as students attempted to contact acquaintances and settle down to college life.
The university therefore was justified in concluding that the invasion of privacy was not clearly unwarranted when balanced against the public interest in avoiding a potentially chaotic situation. It is important to note also that there was a procedure whereby students could "opt out” of the directory.
However, the same reasoning which supports the university’s decision to publish the directory cannot be extrapolated to compel release of the computer tape, even though it contains identical information.
It is not seriously debated that the pervasiveness of computer technology has resulted in an ever-increasing erosion of personal privacy. There is available a larger storehouse of information about each of us than ever before. Computer information is readily accessible and easily manipulated. Data available on a single tape can be combined with data on other tapes in such a way as to create new, more comprehensive banks of information.
"The central problem is to determine how the legal system can best insure that a proper balance is struck between the traditional libertarian ideals embodied in the concept of privacy and the immense social benefit that computer technology offers.” Miller, Personal Privacy in the Computer Age: The Challenge of a New Technology in an Information-Oriented Society, 67 Mich L Rev 1089, 1222 (1969).
While it is true that the computer era has brought untold benefits for society, it also is fraught with potential dangers to our notions of individual autonomy. Vigilance is necessary, lest the right to privacy atrophy due to lack of exercise.
"[T]he computer’s potential as an engine of social change — and human control — indicates that a greater threat to freedom may lie in inaction or continued application of ancient or inapposite doctrine in the face, of the growing power of information in contemporary life and the increasing concentration of control over it.” Id
Form, not just content, affects the nature of information. Seemingly benign data in an intrusive form takes on quite different characteristics than if it were merely printed.
The very existence of information in computer-ready form may serve to motivate an invasion of privacy. "Even if the cost of securing access to computerized information is higher than the cost of dredging out the information in a more traditional form of record, the centralized quality and compactness of a computerized dossier creates an incentive to invade it because the payoff for doing so successfully is much larger.” Miller, Computers, Data Banks and Individual Privacy: An Overview, 4 Colum Human Rights L Rev 1, 10 (1972).
The university was not wrong in concluding that the release of names and addresses on magnetic tape was a more serious invasion of privacy than disclosure in directory form.
Plaintiff has suggested that students whose names and addresses appeared in the directory no longer had an expectation of privacy as to that information. That deduction is not inevitable. Certainly those students who did not opt out should have known that the information was available to persons within the university community free of charge and to others who purchased copies of the directory. Such students also should have known that individuals and organizations with sufficient means could reduce the printed information to computer form and compile mailing lists, or undertake the onerous task of individually contacting each of the 44,000 students.
However, it does not follow that students should have known that an efficient and intrusive computer mailing system already was available to anyone for a nominal sum. In deciding whether to appear in or opt out of the directory, students should not have been expected to consider the mechanics by which the university published the information.
Plaintiff also challenged the trial court’s denial of attorney fees and costs. That issue is moot, since we hold that plaintiff was not entitled to a copy of the computer tape containing the names and addresses of students.
Affirmed. No costs, a public question being involved.
Williams and Coleman, JJ., concurred with Fitzgerald, C.J.
Ryan, J.
This is the first case in which this Court has been called upon to interpret the Michigan Freedom of Information Act (FOIA).
The plaintiff, Lawrence Kestenbaum, sought disclosure of a magnetic tape containing the student directory at Michigan State University and documentation for that tape. The defendants, Michigan State University and its designated FOIA officer, Dale Arnold, defended their refusal to release the tape on the grounds that the FOIA does not require disclosure; that disclosure would constitute an unconstitutional granting of credit in aid of private persons; and that even if the refusal violated the FOIA, the university should not be required to pay plaintiffs reasonable attorney fees, costs, and disbursements. We disagree.
We hold that the requested magnetic tape is a "public record”; that the "public policy” section of the FOIA does not justify nondisclosure; that the tape does not fall within the privacy exemption; that disclosure does not constitute an unconstitutional granting of credit; and that the plaintiff may recover reasonable attorney fees, costs, and disbursements. Accordingly, we would reverse the decision of the Court of Appeals.
The material facts are not in dispute. The plaintiff, president of a registered student political organization, requested a copy of the magnetic tape which the defendant Michigan State University used to produce a student directory. The plaintiff intended to use the names and addresses to facilitate voter registration and to conduct other politi cal mailings in connection with the general election of November, 1978.
The defendant Michigan State University denied the plaintiffs request. It is unclear whether the denial was because of defendant’s failure to respond in a timely fashion, or whether the university committee’s decision, dated October 6, 1978, constituted a timely denial. In any event, the denial of the request for the magnetic tape was followed by an offer to provide the plaintiff with a printed copy of the student directory as soon as it was received from the printer, or, if the plaintiff were willing to pay the cost, the university would run a computer printout of the contents of the tape. The plaintiff rejected the compromise offer, maintaining that the magnetic tape was a public record and that he was entitled to inspect and copy it.
The plaintiff then filed suit in Ingham Circuit Court. The defendant argued that the magnetic tape was exempt from disclosure because release of the information in that form would violate the Family Educational Rights and Privacy Act. However, it was argued that the printing of the permanent student directory did not violate the FERPA because the students were separately advised both of their general right to require their consent before the university released even "directory” information in any form whatsoever, and of their specific right to opt out of the student directory. In addition, MSU employed at least one person who was present at registration and available to discuss with students whether to consent to be included in the directory. Only 20 to 25 of the approximately 44,000 students enrolled at Michi gan State University exercised their option to delete their names from the student directory. The defendant also argued that releasing a copy of the magnetic tape would constitute the use of public funds for a private purpose.
On October 10, 1978, a hearing upon an order to show cause was held before Judge Harrison. In light of scheduling problems and the imminence of the November elections, the trial judge suggested that the attorneys cooperate by stipulating to as much as possible. The plaintiff’s attorney indicated that in order to expedite the matter he would not object to an order restricting the use of the magnetic tape to political purposes and requiring that the tape be returned to the university upon the completion of the campaign. The plaintiff’s attorney also stipulated to the deletion of all information to be published in the student directory (home address, major, year in school, and telephone number), except for the names and local addresses required for plaintiff’s political campaign purposes.
On October 18, 1978, the trial court issued an opinion ordering the defendants to create a copy of the magnetic tape for use by the plaintiff. The stipulated restrictions on use and deletions from the tape were included in the final order. The cost of duplication was to be paid by the plaintiff. The court further ordered that no attorney fees, costs, disbursements, or damages be awarded to the plaintiff, since the denial by Michigan State University was not arbitrary or capricious and the matter presented a valid question of first impression with substantial effects on the rights of third persons. The plaintiff’s motion to modify or amend the order to include reasonable attorney fees, costs, disbursements, and damages was denied.
The plaintiff appealed the denial of attorney fees, costs, disbursements, and damages to the Court of Appeals. The defendants filed a cross appeal on the issues of whether the students’ names and addresses were exempt from disclosure under the Family Educational Rights and Privacy Act, and whether a public body is required under the FOIA to release, for a nominal cost, items of proprietary interest owned by the public.
The Court of Appeals affirmed the denial of attorney fees and costs, but reversed the trial court’s ruling that the plaintiff was entitled to a copy of the magnetic tape. The Court did not rely upon the Family Educational Rights and Privacy Act ground asserted in defendants’ claim of appeal; instead, the Court decided sua sponte that the release of the tape constituted a "clearly unwarranted invasion of an individual’s privacy” within the meaning of MCL 15.243(l)(a); MSA 4.1801(13)(l)(a). The Court also found that release of the computer-readable tape would violate the constitutional provision against granting credit in aid of private persons. Mich Const 1963, art 9, § 18. Kestenbaum v Michigan State University, 97 Mich App 5; 294 NW2d 228 (1980). The plaintiff’s application for rehearing was denied.
This Court granted leave to appeal. 411 Mich 869 (1981). We would reverse.
I
We must determine initially whether the requested magnetic tape is a "public record” within the meaning of the Michigan FOIA. Only a "public record” is subject to the public right to inspect, copy, or receive copies of documents. MCL 15.233(1); MSA 4.1801(3)(1). If the Court of Appeals correctly held that the requested tape is not a "public record”, it would be unnecessary to decide whether the "privacy” exemption, or any exemption, authorizes nondisclosure. Accordingly, the statutory definition of "public record” must be examined.
The term "public record” is defined in MCL 15.232(c); MSA 4.1801(2)(c):
" 'Public record’ means a writing prepared, owned, used, in the possession of, or retained by a public body in the performance of an official function, from the time it is created.”
The computer tape that is the subject of this litigation is a "writing”, since MCL 15.232(e); MSA 4.1801(2)(e) defines a writing to include "magnetic or paper tapes * * * or other means of recording or retaining meaningful content”. The magnetic tape is undisputably "prepared, owned, used, in the possession of, or retained by” the defendant public body. The only remaining question is whether the computer tape was prepared, owned, used, possessed or retained "in the performance of an official function”.
The expression "in the performance of an official function” is not defined in the statute. Accordingly, the term must be construed according to its commonly accepted and generally understood meaning. Production Credit Ass’n of Lansing v Dep’t of Treasury, 404 Mich 301, 312; 273 NW2d 10 (1978). The need to exclude unofficial writings belonging to private citizens from the definition of "public record” is apparent when one recognizes that a state employee is included within the defini tion of a "public body”. MCL 15.232(b)(i); MSA 4.1801(2)(b)(i). A public body may not thwart disclosure under the FOIA by the simple expedient of sending sensitive documents home with its employees. However, unofficial private writings belonging solely to an individual should not be subject to public disclosure merely because that individual is a state employee.
We have no difficulty in concluding that the magnetic tape involved in this case was prepared, owned, used, possessed, and retained by the defendant public body "in the performance of an official function”. As the circuit judge aptly noted in his opinion, "Indeed, it would be useless to argue [that] such an institution could function without such a list of students”. The specific magnetic tape sought in this litigation was used in the preparation and publication. of a student directory, a publication our brother describes as compiled "to ease communications within the campus community” and likely to prevent "a great deal of havoc”. Facilitating communications among students, preventing a great deal of havoc, and simply operating the university in an efficient manner are all "official functions” of Michigan State University. Since the requested "writing” was prepared, owned, used, possessed, or retained by Michigan State University in the performance of these official functions, we hold that the magnetic tape is a "public record”._
II
The "public policy” section of the FOIA does not provide a separate or independent basis for denying disclosure. The first section of the act provides that:
"(1) This act shall be known and may be cited as the 'freedom of information act’.
"(2) It is the public policy of this state that all persons , are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and public employees, consistent with this act. The people shall be informed so that they may fully participate in the democratic process.”
The Court of Appeals apparently concluded that this section creates a special exemption to disclosure of "public documents”. We do not agree.
A policy section, like a preamble, may be used to clarify ambiguous portions of a statute but may not be used to create an ambiguity. 1A Sands, Sutherland Statutory Construction (4th ed), §20.12, p 63. Here, the statute clearly provides that all "public records” must be disclosed unless they are exempt from disclosure under § 13. As stated in MCL 15.232(c); MSA 14.1801(2)(c):
"This act separates public records into 2 classes: (i) those which are exempt from disclosure under section 13, and (ii) all others, which shall be subject to disclosure under this act.”
This strict statutory dichotomy belies the assertion that the public record sought in each individual request must inform the general public about the affairs of government. Instead of requiring a judicial declaration in every individual case that disclosure serves the interests of the "general public”, the Legislature adopted a per se rule requiring the release of all public records, save those falling within an enumerated exception. Such a rule necessarily requires the release of many public records that do not particularly advance the interests of the general public. Unless the release offends one of the § 13 exemptions, however, no reason exists not to disclose such documents.
The Legislature recognized that some FOIA disclosures would benefit only private individuals, while other disclosures would primarily benefit the general public. MCL 15.234(1); MSA 4.1801(4X1):
"Copies of public records may be furnished without charge or at a reduced charge if the public body determines that a waiver or reduction of the fee is in the public interest because furnishing copies of the public record can be considered as primarily benefiting the general public.”
If the preamble required that every FOIA disclosure affirmatively benefit the general public, all FOIA disclosures would qualify for a waiver or reduction of the copying fee. But the Legislature obviously contemplated that many, if not most, FOIA requests would serve "private” or "commercial” interests, since it carefully set forth the method of calculating the ordinary copying charge. MCL 15.234; MSA 4.1801(4).
The presumption in favor of release is clear. The requesting person need not prove any particular need or right to the information, or that the general public interest will be furthered. The test is whether the writing is a "public record” and whether it falls within an enumerated, exemption. The policy of the act is furthered by this test in that (1) administrative and judicial time is not wasted in applying a subjective standard like "furthering the general public interest”, and (2) the risk of erroneous nondisclosure is eliminated except in those cases involving the § 13 exemptions. Contrary to the assertion of the Court of Appeals, the FOIA does provide for free access to public records. The Court does not have an obligation, nor indeed the authority, to narrow by judicial fiat a statute written too broadly to suit its preference; rather the Court has an obligation to enforce the statute as written.
We hold that the "public policy” statement of the FOIA does not provide a rationale for denying disclosure of "public records”. If anything, the policy statement indicates that in close cases, the public body should err on the side of disclosure. The policy statement therefore supports rather than undermines the plaintiff’s request in this case.
Ill
We must now determine whether the requested public record falls within the privacy exemption of § 13. MCL 15.243(l)(a); MSA 4.1801(13)(l)(a):
"(1) A public body may exempt from disclosure as a public record under this act:
"(a) Information of a personal' nature where the public disclosure of the information would constitute a clearly unwarranted invasion of an individual’s privacy.”
A
Our initial inquiry is whether the requested information is "of a personal nature”. Although the Michigan FOIA was patterned after the federal FOIA, the requirement that the information be of a "personal nature” is unique to the state act.
We can find no judicial support for the proposition that names and addresses are "personal” information. Our brother cites the case of Rowan v United States Post Office Dep% 397 US 728; 90 S Ct 1484; 25 L Ed 2d 736 (1970), for the proposition that the release of names and addresses is per se an invasion of one’s personal privacy. In Rowan, a unanimous Supreme Court held that a federal statute allowing persons to have their names deleted from an advertiser’s mailing lists and pro hibiting future mailings to that person did not violate the sender’s First Amendment right to communicate. Nothing in Rowan suggests that the mere act of obtaining an individual’s name and address constitutes an invasion of privacy, or that mailing one piece of mail to an individual constitutes an invasion of privacy. If the individual finds the mailing objectionable and fills out the appropriate postal form, then and only then is the sender’s right to communicate extinguished. The Rowan Court emphasized that only an "unwilling” or "unreceptive” recipient could foreclose the receipt of "unwanted” material through the mail.
In interpreting 39 USC 4009, the Rowan Court struck a delicate balance between the right to send and the right not to receive mail. While purporting to follow Rowan, our colleague’s opinion strikes a far different balance, one greatly restricting the asserted First Amendment right to communicate. Instead of giving the sender the opportunity to make at least one initial mailing, with additional mailings prohibited to those persons finding the first mailing objectionable, our brother presumes that every person will find the first mailing an objectionable "invasion of privacy, * * * a conduit into the sanctuary of the home”, and therefore effectively forbids even the first mailing. This presumption is as paternalistic as it is erroneous. The Rowan decision actually supports the release of the names and addresses and the contemplated political mailing in this case, since it provides the mechanism by which individuals may choose whether to receive mailings from the plaintiff. The individual recipients should decide whether they find the plaintiff’s political mailings objectionable; this Court should not make that decision for them.
We are satisfied that names, addresses, telephone numbers, and other standard identifying information simply are not embarrassing information "of a personal nature” for the overwhelming majority of students at Michigan State University. Most citizens voluntarily divulge their names and addresses on such a widespread basis that any alleged privacy interest in the information is either absent or waived. People applying for employment reveal their names and addresses on their resumes; cashing a check or using a credit card requires the release of one’s address; and ordering magazines or otherwise communicating through the mail reveals one’s address. Being a licensed driver, a car owner, a property owner or taxpayer, an officer of a corporation, an applicant for a marriage license, or a registered voter requires revelation, at a minimum, of one’s name and address, information which is often routinely made available to the public. While some people might prefer that their names and addresses not be known to certain individuals such as advertisers, bill collectors, or freeloading relatives, that preference is simply not based on the fact that one’s address is a "personal”, intimate, or embarrassing piece of information. We leave for another day the question whether, in certain unusual circumstances, ordinarily impersonal information might take on an intensely personal character. Cf. United States Dep’t of State v Washington Post Co, — US —, —; 102 S Ct 1957; 72 L Ed 2d 358, 362, fn 2 (1982).
None of the decisions interpreting the federal FOIA suggest that the release of names and addresses, without more, constitutes an invasion of privacy. In one of the earliest "address list” cases, Getman v NLRB, 146 US App DC 209, 213-214; 450 F2d 670 (1971), the court upheld a federal FOIA request by two labor law professors for a list of names, addresses, and telephone numbers of employees eligible to vote in certain labor elections. The professors were studying the effect of campaign tactics utilized by employers and unions. In order to conduct a valid empirical study, the researchers wished to conduct personal interviews both before and after the election. Accordingly, eligible voters would be telephoned in order to solicit their consent to a personal interview. The court characterized any invasion of privacy involved in "losing their anonymity” and being solicited over the telephone as "relatively minor”.
"[T]he real thrust of Exemption (6) is to guard against unnecessary disclosure of files * * * which would contain 'intimate details’ of a 'highly personal’ nature. The giving of names and addresses is a very much lower degree of disclosure; in themselves a bare name and address give no information about an individual which is embarrassing.” 146 US App DC 214. (Footnotes omitted.)
The only cases in which the federal FOIA has been held not to require the release of names and addresses has been when the disclosure would have revealed additional embarrassing information about an individual. Thus, in Harbolt v Dep’t of State, 616 F2d 772, 774 (CA 5, 1980), the court denied a request for a list of the names and United States addresses of the United States citizens imprisoned in foreign countries on narcotics offenses. The court remarked that "[n]othing could be more personal than an individual’s name and home address, when linked with the stigma of incarceration abroad(Emphasis added.) Similarly, in Wine Hobby USA, Inc v United States Internal Revenue Service, 502 F2d 133 (CA 3, 1974), the release of a list of heads of households registering as making up to 200 gallons of wine per year for personal use was denied not because the release of any list of names and addresses invades the privacy of the persons on the list, but because release of the list would reveal certain potentially embarrassing facts. The court noted that release of the list would reveal (1) that the registering individual was not living alone, (2) that the registering individual was the head of the household, and (3) that winemaking activity was taking place within the home. It is easy to speculate about the embarrassing effect of it being revealed, for example, that the president of the local Women’s Christian Temperance Union makes 200 gallons of wine per year in her basement.
The release of biographical data, without more, has been held not to be barred by the privacy exemption of the federal FOIA. In Simpson v Vance, 208 US App DC 270; 648 F2d 10 (1980), the court found no clearly unwarranted invasion of privacy in the release of names, addresses, educational background, employment experience, and other biographical information about employees of the United States State Department. Of course, release of the list sought in this case would reveal that the named persons were enrolled at Michigan State University, but such information is also not personal, intimate, or embarrassing, especially as to those students electing to have their names published in the student directory. _
Another federal case closely on point is Disabled Officers Ass’n v Rumsfeld, 428 F Supp 454 (D DC, 1977). In that case, an unincorporated nonprofit association of officers retired with or for a service-connected disability sought a list of names and addresses of all such disabled officers. The association engages in a number of political activities, including lobbying and testifying before Congressional committees on legislation affecting the interests of retired military personnel. Like the instant plaintiff, the association intended to solicit support for its organization and its political goals by mailing information to the individuals on the list. The court concluded that, as in Getman, supra, the release of names and addresses did not reveal any personal or embarrassing information, and that any invasion of privacy was minimal.
In Ditlow v Schultz, 170 US App DC 352, 355-356; 517 F2d 166 (1975), the plaintiff sought the names and addresses of all individuals taking trans-Pacific airline flights during a certain time period. The plaintiff intended to use the information to assemble a list of members for his antitrust class action against the airlines. Unfortunately for the plaintiff, his antitrust suit had already been dismissed on the merits, with an appeal pending in the federal circuit court of appeals. The District of Columbia Circuit therefore deferred ruling on the plaintiff’s FOIA lawsuit until such time as it became clear that the antitrust lawsuit was reinstated and it was necessary to compile a list of class members. The Ditlow court did grant the plaintiff the requested relief by enjoining the defendant from destroying the requested data, noting that it was "doubtful” that the information would reveal "intimate or highly personal details” (id., fn 12), and noting that, as in Getman, supra, "disclo sure would result in less than a substantial invasion of privacy”.
Other cases have presented much more compelling reasons for denying the release of certain names and addresses, yet the federal courts have steadfastly implemented the FOIA policy in favor of disclosure. In Robles v Environmental Protection Agency, 484 F2d 843 (CA 4, 1973), the plaintiff sought the names and addresses and radiation levels of some 15,000 homes built with radioactive uranium tailings in and around Grand Junction, Colorado. The homeowners were told that the results of the survey would be confidential. The court held that the privacy exemption did not prevent disclosure, and the information was released. In Kurzon v Dep’t of Health & Human Services, 649 F2d 65 (CA 1, 1981), the court ordered the release of the names and addresses of unsuccessful applicants for research grants from the National Cancer Institute. Despite the damage that might be done to the unsuccessful applicants’ professional reputations, the court found that the case did not fall within the privacy exemption and ordered disclosure.
Consistent with federal authority, we hold that names and addresses of students enrolled at Michigan State University are not "information of a personal nature” within the meaning of MCL 15.243(l)(a); MSA 4.1801(13)(l)(a).
B
Assuming arguendo that the requested names and addresses are "personal” and that disclosure would create an invasion of privacy, the question then becomes whether disclosure would constitute a "clearly unwarranted invasion of an individual’s privacy”. In Dep’t of the Air Force v Rose, 425 US 352; 96 S Ct 1592; 48 L Ed 2d 11 (1976), the United States Supreme Court adopted a "balancing test” under which the public interest in disclosure is to be weighed against the individual’s right to privacy. The majority concluded that disclosure of discipline case summaries of honor code violations at the Air Force Academy did not necessarily constitute a "clearly unwarranted” invasion of privacy, as long as names and other identifying information were deleted. The court acknowledged that some officers’ identities might be known and revealed by fellow cadets who remembered the incident leading to a discipline hearing and that such identification "could expose the formerly accused men to lifelong embarrassment, perhaps disgrace, as well as practical disabilities, such as loss of employment or friends”. Id., p 377. But the Court reasoned that the privacy exemption "was directed at threats to privacy interests more palpable than mere possibilities”. Id., p 380, fn 19. Further, upon remand and in camera inspection, the trial court was free to withhold any case summary if deletion of all identifying information was insufficient to safeguard privacy. Id., p 381.
Unfortunately, the Supreme Court failed to specify whether the "balancing” is to be done in light of a hypothetical, unrestricted public disclosure or the specific disclosure and use contemplated by the requesting party. See Ditlow, supra, 170 US App DC 357; Getman, supra, 146 US App DC 216, fn 24; Disabled Officers Ass’n, supra, 428 F Supp 457. Perhaps in Rose it was unnecessary to decide that issue, since the specific use contemplated was unrestricted public disclosure in a law review article. In principle, most courts would find that unrestricted public disclosure is required by the fact that "any person” or "a person” may obtain re cords under the federal FOIA. In practice, however, the merits of the specific contemplated use appear to determine whether or not the court will order disclosure.
Our brother notes this dilemma and would hold that "[i]t is permissible to define the public interest in disclosure by referring to the uses contemplated by some members of the public, but not by exclusively focusing on the intention of the person requesting the information” (emphasis in original), and that "a specific purpose cannot serve as a catalyst nor an impediment to disclosure”. If the lower courts find it difficult to agree as to whether a specific public benefit is outweighed by a specific invasion of privacy, how can they possibly balance hypothetical public benefits against hypothetical invasions of privacy? The ease with which such a vague hypothetical balancing test can be manipulated is obvious. By failing to mention beneficial uses to which some members of the public might put the information, and emphasizing the dan gers of a "computerized dossier” that some members of the public might create, our brother’s conclusion is foreordained. While limiting the uses to which the information is put and the persons to which it is disclosed is not always easy or practical, such a procedure should be followed when the alternative is total nondisclosure. The overriding purpose of the FOIA is to require the fullest possible disclosure; when a clearly unwarranted invasion of privacy would result from unrestricted disclosure, but not from a disclosure limited to certain persons for specific purposes, the privacy exemption cannot justify the blanket nondisclosure approved by my colleague.
We think the public benefits of voter registration and political campaigning contemplated in this case clearly outweigh any minimal invasion of privacy. The fundamental importance of voter registration and political communication in a democ racy cannot be overestimated. However, as in Disabled Officers Ass’n, supra, which did not involve an "opt out” option, we do not find it necessary to impose any restrictions limiting disclosure to political purposes. One can agree that "[e]veryman’s mail today is made up overwhelmingly of material he did not seek from persons he does not know” without finding that such "junk mail” constitutes an intolerable or actionable invasion of privacy. In dismissing a suit to enjoin the State of New York from selling the names and addresses of persons registering automobiles, the federal court aptly noted that:
"The short, though regular, journey from mail box to trash can * * * is an acceptable burden, at least as far as the Constitution is concerned.” Lamont v Comm’r of Motor Vehicles, 269 F Supp 880, 883 (SD NY, 1967).
Students at Michigan State University may prevent the release of their names and the consequent receipt of unsolicited "junk mail” by (1) filing notice under the federal Family Educational Rights and Privacy Act that "directory information” is not to be released absent prior consent, or (2) responding to the specific "opt out” opportunity to be excluded from the student directory. Once a piece of "offensive” junk mail is received, further mailings from that sender may be prevented by (3) filing the appropriate form with the post office under 39 USC 3008. The persons listed on the requested tape have not one but three opportunities to avoid undertaking the journey from mail box to trash can; that is more than sufficient to protect their right of privacy. The stated purpose of Rowan, supra, 397 US 736, was to "make the householder the exclusive and final judge of what will cross his threshold”. Instead, this Court would impose its judgment as to the offensiveness of junk mail on those householders who have failed to exercise not one but three options to avoid such mail. That policy is both unwise and inconsistent with the provisions of the FOIA.
We therefore hold that unrestricted public disclosure of the requested information does not constitute a "clearly unwarranted invasion of an individual’s privacy” within the meaning of the privacy exemption.
IV
Our brother appears to agree that the disclosure of the requested names and addresses in printed form does not constitute a clearly unwarranted invasion of privacy. However, he asserts that disclosure in magnetic tape form does constitute a clearly unwarranted invasion of privacy.
We cannot accept the conclusion that the Legislature intended to allow a public body to exempt otherwise public records from disclosure by the simple expedient of converting the public record from one form to another. Surely such a result would exalt form over substance. The plain language of the statute reveals a legislative intent to treat all governmental "writings” in the same fashion regardless of form. MCL 15.232(e); MSA 4.1801(2)(e):
" 'Writing’ means handwriting, typewriting, printing, photostating, photographing, photocopying, and every other means of recording, and includes letters, words, pictures, sounds, or symbols, or combinations thereof, and papers, maps, magnetic or paper tapes, photographic films or prints, microfilm, microfiche, magnetic or punched cards, discs, drums, or other means of recording or retaining meaningful content.” (Emphasis added.)
The supposed protection of students’ privacy gained by denying disclosure in magnetic tape form is both unfair and illusory. The denial is unfair because it penalizes only those groups or individuals unable to afford the cost of converting the printed information into magnetic tape form. This cost barrier is illusory in that any commer cial organization anticipating a return from its solicitation in excess of the cost of creating the tape will have no deterrent whatsoever to putting the information in a computer-readable format. In fact, the actual number of unsolicited mailings to the student body might well increase, since the company has every incentive to recoup its initial investment by selling or renting the tape to as many groups or organizations as possible. The result would be that commercial solicitations of the student body would be feasible while political campaigns would be difficult, except perhaps for the particularly affluent.
The appellee argues that since the information is made available in printed form, the purposes of the Freedom of Information Act have been satisfied. But nowhere in § 13 can there be found an exemption for "information” already available to the public. Instead, we find in MCL 15.232(c); MSA 14.1801(2)(c), that "public records” not public information, must be disclosed unless exempt. Similarly, MCL 15.233; MSA 4.1801(3) gives a person the right to "inspect, copy, or receive copies of a public record”, not merely to obtain the "information” contained in a public record in any form in which the public body sees fit to release it. A paper printout is simply not a "copy” of a magnetic tape. Furthermore, the act directs that "A public body shall utilize the most economical means available for providing copies of public records”. MCL 15.234(3); MSA 4.1801(4X3). The undisputed testimony revealed that it was both cheaper and faster to copy the magnetic tape than to create a printed list of some 44,000 names and addresses. The defendant Michigan State Univer sity violated this clear statutory directive by attempting to utilize the less economical means of creating printed material from the magnetic tape.
Our brother holds that nondisclosure of the magnetic tape is justified because it converts "seemingly benign data” into "an intrusive form”. It is obvious that the magnetic tape form makes the information more usable for the purposes contemplated by the plaintiff: mailing political information. But to equate usefulness with intrusiveness is to turn the FOIA on its head. A public body should not be allowed to thwart legitimate uses of public information by releasing the information in a format difficult or expensive to use. Releasing the requested names and addresses in handwritten form would make it even more difficult to read and use the information; surely that does not mean that a person requesting a printed copy can be given a handwritten copy because the latter is less usable and therefore less "intrusive”? Following that rationale would encourage a public body to meet its FOIA requests with the response that the actual public document or "writing” cannot be copied, but the agency will gladly produce the same "information” in a "less intrusive” form such as a foreign language, Morse Code, or hieroglyphics.
Finally, our colleague attaches little significance to the fact that the students listed on the tape failed to exercise not one but two opportunities to prevent their names from even appearing on the tape. It is argued that their consent was limited to release in printed form only. I cannot agree in light of the unrestricted disclosure of "directory information” authorized under the Family Educational Rights and Privacy Act, 20 USC 1232g. That statute, as well as 45 CFR 99.37, does not restrict disclosure of names and addresses to any form, unless the student affirmatively forbids disclosure. Any student wishing to prevent identifying information from being disclosed on magnetic tape would have to "opt out”, since the university could always make a discretionary disclosure not required by the FOIA. Chrysler Corp v Brown, 441 US 281; 99 S Ct 1705; 60 L Ed 2d 208 (1979). In fact, the university did sell the requested magnetic tape to a private corporation, which in turn used the tape in a profit-making enterprise, the publication of the 1978-1979 Student Directory. The effect of our colleague’s opinion is that the university could sell or lease the same tape to other private corporations, to one political party and not another, to opponents of initiative proposals and not supporters, or to incumbent candidates for the board of trustees and not challengers. Surely the students failing to opt out of the directory did not have any reasonable expectation that their "directory information” would be released only in certain forms. To the extent any such expectation exists, it can be easily eliminated in the future by this Court’s opinion and any revised "opt out” notice given by the university.
We agree with the United States Supreme Court in Dep’t of Air Force, supra, 425 US 361, that the exemptions from disclosure "must be narrowly construed”. The Court must balance the public interest against the privacy interests with a "tilt” in favor of disclosure. Disabled Officers Ass’n, supra, 428 F Supp 457, and cases cited therein. We are obligated to remember that the alleged invasion of privacy must be "clearly unwarranted”. That standard charges the defendant Michigan State University with the heavy burden of proving that the requested document was exempt from the general rule of disclosure. That burden has not been met. We must dissent from the view that the requested magnetic tape may be exempted from disclosure under the exemption for a "clearly unwarranted” invasion of privacy.
V
The Court of Appeals assigned as a separate reason for denying disclosure Mich Const 1963, art 9, § 18, which provides in pertinent part that:
"The credit of the state shall not be granted to, nor in aid of any person, association or corporation, public or private, except as authorized in this constitution.”
Without engaging in an extended analysis of pre-1963 cases interpreting the analogous provision of earlier Michigan Constitutions, it is clear that in order to trigger application of art 9, § 18, there must be a lending of credit. Gaylord v Gaylord City Clerk, 378 Mich 273, 291-294; 144 NW2d 460 (1966); Advisory Opinion re Constitutionality of 1966 PA 346, 380 Mich 554, 563-564; 158 NW2d 416 (1968); Advisory Opinion on Constitutionality of 1976 PA 295, 1976 PA 297, 401 Mich 686, 701-703; 259 NW2d 129 (1977). In Skutt v Grand Rapids, 275 Mich 258; 266 NW 344 (1936), it appears that the city may have engaged in unauthorized borrowing by becoming party to repaying the indebtedness of others.
The opinion in Younglas v Flint, 345 Mich 576; 77 NW2d 84 (1956), was based not upon an unauthorized extension of credit, but upon the expenditure of tax funds for a nonpublic purpose. While the definition of "public purpose” for taxation purposes was once very narrow, the concept has been greatly enlarged in the modern era. See Poletown Neighborhood Council v Detroit, 410 Mich 616, 664; 304 NW2d 455 (1981) (Ryan, J., dissenting). The public purposes of the Freedom of Information Act are more than sufficient to justify the disclosure of public records on an equal basis to the general public for the incremental cost of copying, rather than the original cost of creating the public record. The general philosophy of the act is that public records "belong” to the public; we refuse to sanction nondisclosure on the theory that this is "proprietary” information "belonging” to the public body.
VI
Our reversal of the Court of Appeals on the merits necessitates consideration of the attorney-fee issue raised by the plaintiff. The attorney-fee provision of the Michigan FOIA provides:
"(4) If a person asserting the right to inspect or to receive a copy of a public record or a portion thereof prevails in an action commenced pursuant to this section, the court shall award reasonable attorneys’ fees, costs, and disbursements. If the person prevails in part, the court may in its discretion award reasonable attorneys’ fees, costs, and disbursements or an appropriate portion thereof. The award shall be assessed against the public body liable for damages under subsection (5).” MCL 15.240(4); MSA 4.1801(10X4).
Although the plaintiff prevailed at the circuit-court level by obtaining an order directing production of a copy of the magnetic tape containing student names and addresses, the circuit judge denied the requested attorney fees because
"the denial by MSU was not arbitrary or capricious and * * * the matter presented to the court was a valid question of first impression with substantial effects on the rights of third persons.”
A motion to modify or amend the order to include an award of attorney fees was denied without further explanation.
It may be that the trial court denied the requested attorney fees on the theory that the defendant public body did not "arbitrarily and capriciously” violate the act within the meaning of MCL 15.240(5); MSA 4.180N10)(5). But a finding of an arbitrary and capricious violation is only necessary when the plaintiff seeks additional punitive damages in the amount of $500 pursuant to subsection (5). The absence of any such requirement from the attorney-fee provision of subsection (4) is a persuasive indication that the Legislature intended to allow the plaintiff reasonable attorney fees even if the public body’s denial was not arbitrary and capricious but was in good faith. Under the Michigan FOIA, the court "shall award reasonable attorneys’ fees, costs, and disbursements” to a prevailing plaintiff.
The denial of attorney fees might also have been based upon the view, as urged by the defendant, that the plaintiff did not prevail but only prevailed "in part”. It is argued that if the plaintiff only "prevails in part” the trial judge has the unfettered discretion to deny attorney fees altogether. While at first blush the statute is susceptible of that interpretation, a closer reading convinces us that the court’s discretion is limited to awarding one of the two statutory alternatives; namely, "reasonable attorneys’ fees, costs, and disbursements”, or else "an appropriate portion thereof’.
The basic rule set forth in the statute is that a prevailing plaintiff is entitled to his attorney fees, costs, and disbursements. If the plaintiff prevails in full, it matters not a whit that the defendant’s denial was not arbitrary or capricious, that the legal point was one of first impression, or that the defendant may have sought in good faith to protect the rights of third parties by violating the statute. If the plaintiff seeks disclosure of ten documents and the court orders disclosure of the ten documents, the plaintiff has prevailed and the court shall award reasonable attorney fees, costs, and disbursements.
But suppose the same plaintiff sought disclosure of one more document in addition to the ten disclosed and the court upheld the denial as to this eleventh document. Must we conclude that since the plaintiff has only prevailed "in part” the trial judge can exercise his "discretion” and deny any award of attorney fees? Such an approach would be contrary to the spirit of the FOIA, since it would encourage plaintiffs to include in their FOIA suit only those requests which they are absolutely certain will prevail. Alternatively, that approach would encourage the drastic fragmentation of FOIA claims. A separate complaint would be filed for each document requested (or, in this case, each deletion or restriction on the use of the information) so that the plaintiff could prevail "in full” as to each document ultimately disclosed. Such a procedure fails to comport with judicial efficiency, legislative intent, or common sense.
In the case of a plaintiff who "prevails in part”, we read the statute to confer upon the court the discretion to award either the entire amount of plaintiff’s reasonable attorney fees, costs, and disbursements or an appropriate portion thereof. The appropriateness of the portion awarded is not to be measured by the good faith of the defendant or the novelty of the litigation, but rather by the amount of attorney fees, costs, and disbursements fairly allocable to the successful portion of the plaintiff’s case.
In the instant case, the plaintiff prevailed on the critical point in dispute, namely, whether Michigan State University is required to release the requested student names and addresses in magnetic tape form. The deletions from the tape and restrictions upon use were stipulations suggested by the plaintiff to expedite the decision. Whether we conclude that the plaintiff prevailed in full or in part, it is clear that the amount of attorney fees allocable to the "denied” portion of the magnetic tape was negligible. If anything, the plaintiff’s stipulation saved considerable court time and attorney fees for both sides; such stipulations should be encouraged rather than discouraged.
Accordingly, the decision of the Court of Appeals is reversed, and the case is remanded to the circuit court for a determination of reasonable attorney fees, costs, and disbursements. We do not retain jurisdiction.
Kavanagh and Levin, JJ., concurred with Ryan, J.
The late Justice Blair Moody, Jr., took no part in the decision of this case._
Michigan State University, as a recipient of federal funds, falls within the purview of the Family Educational Rights and Privacy Act (Buckley Amendment; PL 90-247, Title IV, § 438 as amended; 20 USC 1232g, 45 CFR 99.1 et seq.). That statute provides for access to student records by eligible students and parents, and also establishes the privacy of those records.
Under § 10 of the FOIA, MCL 15.240; MSA 4.1801(10), a person who challenges the denial of information and prevails in court is entitled to reasonable attorney fees, costs and disbursements. If the person prevails only in part, the award of compensation is discretionary with the court. If the court determines that the public body acted arbitrarily and capriciously, the plaintiff receives punitive damages in addition to any actual or compensatory damages.
The federal act, PL 89-487, 80 Stat 250 (1966), was codified at 5 USC 552 by PL 90-23, 81 Stat 54 (1967). Major amendments were enacted in 1974 by PL 93-502, §§ 1-3, 88 Stat 1561-1564. The act was amended further by PL 94-409, § 5(b), 90 Stat 1247 (1976); PL 95-454, Title IX, § 906(a)(10), 92 Stat 1225 (1978).
Section 13 of the FOIA reads in part: "(1) A public body may exempt from disclosure as a public record under this act”. (Emphasis added.) Total discretion to release information which meets the definition of particular exemptions would lead to peculiar results: a public body would be free to release information which would "interfere with law enforcement proceedings”, "deprive a person of the right to a fair trial or impartial administrative adjudication”, "endanger the life or physical safety of law enforcement personnel”, and violate certain privileges such as that of attorney-client, physician-patient and priest-penitent.
An action brought to enjoin the release of arguably private information is called a "reverse” FOIA suit. Most commentators agree that the drafters of the FOIA legislation probably did not contemplate the problems that such suits would create. One critic described the dilemma facing public bodies which must decide whether to disclose information which arguably could be withheld under the privacy exemption: "Under these circumstances, the government agency occupies a delicate position in the midst of the submitter’s and requester’s competing interests, requiring Odyssean skills to safely navigate the narrow strait between Scylla and Charybdis.” English, Protecting the Stakeholder: Defense of the Government Agency’s Interests During Reverse FOIA Lawsuits, 31 Adm L Rev 151, 152 (1979). Another critic suggests that a statutory scheme that makes withholding of such information discretionary with the public body yet does not provide for notice to the one whose privacy will be invaded "gives the impression of having been sketched by a surrealistic draftsman”. Miller, Personal Privacy in the Computer Age: The Challenge of a New Technology in an Information-Oriented Society, 67 Mich L Rev 1089,1196 (1969).
Warren & Brandeis, The Right to Privacy, 4 Harv L Rev 193, 195 (1890), quoting from Cooley, Torts (2d ed), p 29.
See, for instance, Martin v Struthers, 319 US 141; 63 S Ct 862; 87 L Ed 1313 (1943); Public Utilities Comm of the Dist of Columbia v Pollak, 343 US 451; 72 S Ct 813; 96 L Ed 1068 (1952); Mapp v Ohio, 367 US 643; 81 S Ct 1684; 6 L Ed 2d 1081 (1961); Camara v Municipal Court of the City & County of San Francisco, 387 US 523; 87 S Ct 1727; 18 L Ed 2d 930 (1967); Stanley v Georgia, 394 US 557; 89 S Ct 1243; 22 L Ed 2d 542 (1969); Rowan v United States Post Office Dep’t, 397 US 728; 90 S Ct 1484; 25 L Ed 2d 736 (1970). United States v Orito, 413 US 139; 93 S Ct 2674; 37 L Ed 2d 513 (1973); United States v Martinez-Fuerte, 428 US 543; 96 S Ct 3074; 49 L Ed 2d 1116 (1976); and FCC v Pacifica Foundation, 438 US 726; 98 S Ct 3026; 57 L Ed 2d 1073 (1978).
Determining the degree of an invasion of privacy should not be a difficult task for courts, since they have demonstrated their abilities to do so in other areas. When the phrase "clearly unwarranted invasion of privacy” is used in tort litigation, "courts have quantified the magnitude of the infringement by deciding whether the matters or information made public would be 'offensive and objectionable to a reasonable man of ordinary sensibilities’. The customs, mores, or ordinary views of the community have been used as references in this determination.” (Footnotes omitted.) Hoglund & Kahan, Invasion of Privacy and the Freedom of Information Act: Getman v NLRB, 40 Geo Wash L Rev 527, 539 (1972). A similar approach under the FOIA may avoid potential inequities.
Under § 10(1) of the FOIA, a person whose request for information is denied may sue in circuit court to compel disclosure. The court determines the matter de novo, with the burden on the public body to sustain its denial.
At least one federal circuit court of appeals has discussed the special dilemma a court faces when reviewing a FOIA case de novo and attempting a balancing of interests. "That a balancing is envisioned is plain. What is unclear is whether the balancing is to be performed in the context of unrestricted disclosure to the public or of a use-specified release confined to the requesting parties.” Ditlow v Schultz, 170 US App DC 352, 357; 517 F2d 166 (1975). Earlier the court had expressed this view in a footnote: Since the privacy exemption "necessarily requires the court to balance a public interest purpose for disclosure of personal information against the potential invasion of individual privacy, a court’s decision to grant disclosure * * * carries with it an implicit limitation that the information, once disclosed, be used only by the requesting party and for the public interest purpose upon which the balancing was based.” Getman v NLRB, 146 US App DC 209, 216, fn 24; 450 F2d 670 (1971).
Note: Even after determining that certain information is exempt from disclosure under the FOIA because its release would constitute a clearly unwarranted invasion of privacy, a public body and reviewing court are required to further ascertain whether the material could be edited so that certain segments still could be available as a public record. FOIA, § 14(1), MCL 15.244(1); MSA 4.1801(14)0). In the instant case, redaction of the exempt information — names and addresses of students — would render the computer tape useless to plaintiff Kestenbaum.
See fn 8.
Students who desired to withhold their names from the directory were required to submit a signed, written request at the Administration Building within the first five days of the fall term classes. The existence of the directory and students’ rights concerning it were noted in the Schedule of Classes and Student Handbook.
See, for example, O’Brien, Privacy and the Right of Access: Purposes and Paradoxes of Information Control, 30 Adm L Rev 45 (1978); Miller, Computers, Data Banks and Individual Privacy: An Overview, 4 Colum Human Rights L Rev 1 (1972); Miller, Personal Privacy in the Computer Age: The Challenge of a New Technology in an Information-Oriented Society, 67 Mich L Rev 1089 (1969).
The director of data processing at Michigan State University testified that the initial cost of developing the computer tape of the student directory was about $3,000. He estimated the incremental cost of producing a copy at only $60, however.
MCL 15.231 et seq.; MSA 4.1801(1) et seq.
The university did not produce the directory itself; instead, the magnetic tape was sold to a private profit-making corporation, Promotional Enterprises. That company printed at least 22,000 directories free of charge for the university; it covered its costs and made its profit by selling ads or "yellow pages” which are included in the student directory. Then the magnetic tape was either returned to the university or destroyed.
See MCL 15.235, subds (2) and (3); MSA 4.1801(5), subds (2) and (3).
20 USC 1232g.
Actions under the FOIA are to be heard at the earliest practicable date and expedited in every way. MCL 15.240(3); MSA 4.1801(10)(3).
The question whether a writing is a "public document” or a private one not involved "in the performance of an official function” is separate and distinct from the question whether the document falls within the so-called "privacy exemption” of MCL 15.243(1)(a); MSA 4.1801(13)(1)(a). Many writings prepared, owned, used, possessed, or retained by government in the performance of its functions may contain intimate and embarrassing facts of a personal nature. This does not prevent them from being classified as "public documents”. Nondisclosure of such "public documents” must be justified, if at all, under the enumerated exemptions of the FOIA.
MCL 15.231; MSA 4.1801(1).
"The list of names requested by plaintiff is not related to the affairs of government in such a way as to constitute a basis for official decisions on the part of the university. The release of these names and addresses and the other information contained in the student directory does not assist the general public in such a way as to permit them to fully participate in the affairs of government.” Kestenbaum v Michigan State University, 97 Mich App 20-21.
MCL 15.243; MSA 4.1801(13).
Even if the statute did require a finding that the general public interest be served before a public record could be disclosed, we would require disclosure under the facts of this case. The right of citizens to "be informed so that they may fully participate in the democratic process” is of little value if the government requires each person to seek out the information for himself. Many citizens depend on mailings from political candidates and groups to be fully informed. The theoretical availability of alternate forms of political communication, some or all of which may be costly or ineffective when compared to a selective mail campaign, does not deny the fact that the flow of information to the people is increased by the voter registration and political activities of the plaintiff.
In addition, it is not at all clear that the only public benefit to be derived from the FOIA relates directly to "open government”. As noted by Anthony T. Kronman in The Privacy Exemption to the Freedom of Information Act, 9 J Legal Studies 727, 744 (1980), one aim of the federal FOIA is:
"to facilitate the exploitation of positive externalities created by the government’s acquisition of valuable information. Although the bureau’s list was compiled for a specific governmental purpose, it could also be used productively in other ways (including those contemplated by the plaintiff). If the plaintiff’s use of the information were costless —if disclosure would not invade anyone’s privacy or impair the government’s ability to gather similar information in the future — the wealth of society could be increased by compelling the bureau to reveal its list of names and addresses.” See, also, pp 737-738.
"It is evident there is a tendency to interpret the FOIA as a freedom of public records act. When a statute is so broad that it makes all information available to anyone for any purpose, the court has an obligation to narrow its scope by judicial interpretation.” Kestenbaum, supra, 97 Mich App 23.
Of course, the plaintiff does not assert that the Michigan FOIA makes all information available to anyone for any purpose. The plaintiff simply insists that any exception to the general rule of disclosure must be grounded in a statutory exemption rather than a judicial "interpretation” that, in the opinion of the court, release would not affirmatively advance the interests of the general public.
The only other enumerated exception suggested by the defendant is MCL 15.243(1)(e); MSA 4.1801(13)(1)(e), "[i]nformation the release of which would prevent the public body from complying with 20 U.S.C. section 1232g”. We agree with the analysis of both lower courts, which held that release of the requested information in magnetic tape form would not violate the federal statute or its regulations.
In this section, we analyze whether the disclosure of the requested information falls within the privacy exemption without regard to the form in which the information is contained. In part IV, we specifically consider whether the fact that the requested writing is in magnetic tape form is sufficient to bring the document wijthin the privacy exemption.
Compare 5 USC 552(b)(6):
"(b) This section does not apply to matters that are—
"(6) personnel and medical files and similar files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.”
Even the most innocuous fact about a person is potentially embarrassing. See Kronman, supra, p 752, and Ditlow v Schultz, 170 US App DC 352, 355-356, fn 12; 517 F2d 166 (1975), regarding the names, addresses, and flight numbers of certain airline passengers:
"One can speculate instances in which disclosure of such information might prove embarrassing — e.g., to a traveler who for personal or commercial reasons has put forward a different account of his activities. There may likewise be occasions where a telecast of the crowd at a baseball game may show and embarrass the employee who sought and obtained time off for his grandmother’s funeral.”
If any information that might in the abstract prove embarrassing to some people could not be released, our state FOIA would never allow the release of any information about any identifiable person. We interpret "personal” information to mean the kinds of intimate or embarrassing details that most persons prefer to disclose infrequently and selectively, if at all.
39 USC 4009, now 39 USC 3008.
At most, 25 out of approximately 44,000 students exercised their option to delete their names, addresses, telephone numbers, and other such information from the published student directory. The 25 or so students who chose to "opt out” are not listed on the computer tape sought by the plaintiffs; it seems fairly safe to conclude that the remaining 43,975 students do not consider their names, addresses, and telephone numbers to be embarrassing personal information, the disclosure of which would constitute a "clearly unwarranted invasion of * * * privacy.”
For availability of driver’s license information, including record of traffic offenses and the duty to notify of address changes, see MCL 257.204a; MSA 9.1904(1), MCL 257.208; MSA 9.1908, MCL 257.315; MSA 9.2015, MCL 257.316; MSA 9.2016. For availability of vehicle registration lists, see MCL 257.232; MSA 9.1932, authorizing the Secretary of State to sell the lists to any person for a reasonable price. Names and addresses involved in the conveyance of real property are open to public inspection in the office of the register of deeds. MCL 565.25; MSA 26.543, MCL 565.551; MSA 26.791. Property tax assessment rolls and indexes may be inspected. MCL 211.10a; MSA 7.10(1), MCL 211.25a; MSA 7.25(1). Information on corporate officers and directors is available through the Corporations and Securities Bureau. MCL 450.1131; MSA 21.200(131). Names, addresses, ages, and other information required by the director of public health in making application for a marriage license are matters of record. MCL 551.102; MSA 25.32. The rolls of registered voters and the elections in which they have voted are available for inspection and copying. MCL 168.516; MSA 6.1516, MCL 168.522; MSA 6.1522.
It is hard to take seriously the assertion that the advent of the modern computer era poses a significant threat to the secrecy of one’s name and address. In the days of our forefathers, • one’s name and address were a matter of general public knowledge. An individual’s home may still be a "castle” into which "not even the king may enter”, Rowan, supra, p 737; but nothing prevents the king or anyone else from telling others whose castle it is, particularly when the castle-dweller himself has voluntarily released that information to the general public.
5 USC 552 et seq.
Or, as in Baldrige v Shapiro, 455 US 345; 102 S Ct 1103; 71 L Ed 2d 199 (1982), the requested names and addresses are within a different FOIA exemption. In Baldrige, names and addresses collected during the census were held to be "specifically exempted from disclosure by statute”, namely the Census Act, within the meaning of exemption three.
Kronman, supra, p 747. Even so, Wine Hobby may well have been wrongly decided. See Kronman, supra, pp 741-748, especially p 742: "The decision in the Wine Hobby case may be criticized on two related grounds: first, that the court unduly discounted the positive benefits of revealing the information sought by the plaintiff and, second, that it exaggerated the negative consequences of disclosure”.
While Simpson was criticized in United States Dep’t of State v Washington Post Co, — US —; 102 S Ct 1957; 72 L Ed 2d 358 (1982), that criticism was based on the lower court’s narrow interpretation of "similar files” rather than its ultimate conclusion that the privacy exemption did not authorize withholding the biographical data. The "similar files” language at issue in Washington Post Co was deleted from the Michigan FOIA; unlike the federal FOIA, Michigan’s privacy exemption is explicitly limited to "personal” information.
The former federal statute only authorized release to "persons properly and directly concerned”. See Kronman, supra, p 743, especially fn 60, for the argument that the requester’s motive is irrelevant and may neither contract or expand his FOIA rights. However, the privacy exemption, exemption six, may be an exception to the general rule. See Getman, supra, 146 US App DC 216, fn 24.
See Wine Hobby, supra, 502 F2d 137: "[T]he sole purpose for which [plaintiff] * * * seeks the information is for private commercial exploitation. Wine Hobby advanced no direct or indirect public interest purpose in disclosure of these lists and indeed, we can conceive of none.” Suppose the Washington Post sought the same list to further its investigation of fraud in the administration of the wine permit program? See Getman, supra, 146 US App DC 215: "This particular study has been reviewed and supported by virtually every major scholar in the labor law field.” Suppose instead a business association sought the same list to conduct its new anti-union campaign? Cf. Committee on Masonic Homes v NLRB, 556 F2d 214 (CA 3, 1977). Suppose the plaintiffs in Rose, supra, had been members of a communist party seeking to spread dissension in the ranks of the United States armed forces? See also Harbolt, supra, 616 F2d 775: "We can attach very little weight in terms of the balancing test described to any work a federal prisoner might accomplish for the detainees.”
E.g., some distinguished professors might use the list to study the quality of education at the university, or some newspaper might attempt to discover fraud in the number of students actually enrolled for purposes of calculating state aid, or some law review editors might study the minority admissions policy and its effect on the composition of the student body. Countless other possibilities exist.
Every bit of information released under the FOIA has the potential for misuse or abuse. At some point, such misuse is an independent supervening cause, e.g., when a name, address, and phone number listed in the student directory is used for obscene or threatening phone calls, MCL 750.540e; MSA 28.808(5), or extortion, MCL 750.213; MSA 28.410, the criminal act rather than the disclosure of information constitutes the invasion of privacy.
In this case, we note that the circuit judge restricted disclosure to the plaintiff solely for campaign purposes, with the tapes to be returned at the end of the campaign. The restriction was enforced by the court’s contempt powers, and nothing in the record indicates that the restriction was disobeyed. Similarly, when the defendant Michigan State University sold the requested magnetic tape to Promotional Enterprises, a private profit corporation, the tape was returned or destroyed after the specific contemplated use was completed. Thus, in the usual "limited disclosure” case, either contractual or judicial restrictions appear adequate to enforce any necessary restrictions on disclosure. If the restrictions are unenforceable under the facts of a particular case, then and only then must the choice be made between total disclosure and total nondisclosure.
Rowan, supra, 397 US 736.
My brother fails to cite a single decision, state or federal, for the proposition that the requested document should be withheld simply because it is stored in magnetic tape form. Until today, that claim has been uniformly rejected. Ortiz v Jaramillo, 82 NM 445, 447; 483 P2d 500 (1971), ("We fail to understand how it can be said the inspection and copying of information contained on a printed and written affidavit of registration, which is a public record, is proper, but the inspection and copying of this identical information from the 'working master record’ tape, which is also a public record, constitutes an invasion of the privacy of the individual named in and identified by this information. Nothing * * * cited by respondent, supports any claim that the information contained in a written public record becomes confidential, or cloaked with a protection of privacy, upon being converted into a reproducible form on a magnetic tape, which is also a public record.”); Martin v Ellisor, 266 SC 377, 379; 223 SE2d 415 (1976) (Required release of magnetic tape containing names and addresses of all registered voters despite defendant’s willingness "to provide the identical information in the form of a computer printout or microfiche.”); Menge v City of Manchester, 113 NH 533; 311 A2d 116 (1973) (Plaintiff held entitled to computerized tape indicating ownership, description, and value of all real property within the city; the fact that the cost of copying the tape was $40 while the cost of converting the written information onto tape was $12,500 is a "com mon sense argument in favor” of requiring release in magnetic tape form). See Minnesota Medical Ass’n v State, 274 NW2d 84 (Minn, 1978), (Information stored on computer tapes is still a "public record”; the court rejected the assertion that only microfilm of the original invoices was required to be disclosed, reasoning that the law "places no restrictions on the form in which the records shall be made available” nor does it "proscribe furnishing the records in some other form acceptable to the requester.” [Emphasis added.]). See also Ky Op Atty Gen 77-480 (1977); 630 Op Md Atty Gen (1978); Lorain County Title Co v Essex, 53 Ohio App 2d 274; 373 NE2d 1261 (1976) (microfilm).
Defendant’s witness testified that the original work cost a little less than $3,000, while the fair market value of the tape might be $4,000.
We do not mean to foreclose the argument in some future case that the public body must make public documents available if requested in a more expensive but more usable format as long as the requester is willing to pay the higher cost. A political organization without the funds or expertise to decode a magnetic tape with a computer might request the more expensive printed format; we leave for such future case the question whether there is a legitimate reason why a public body should be allowed to deny such a request.
It is not necessary to accept as fact plaintiffs nonrecord allegations that the defendant has in the past provided another registered student organization with approximately 30,000 mailing labels from the student directory for a political mailing to oppose certain tax-cut proposals. It is sufficient to note that such political favoritism might well occur if the state is free to distribute useful political materials with unfettered discretion. The state FOIA prevents such political favoritism by declaring that "public records” belong to the people, not the public body; under the correct interpretation of the act, the potential for such abuse is eliminated because the requested "public record” must be made available to all persons equally.
Compare the FOIA provision that exempts certain law enforcement records if the invasion of privacy resulting from disclosure would be "unwarranted”. MCL 15.243(1)(b)(iii); MSA 4.1801(13)(1)(b)(iii).
The Legislature recognized that the FOIA would result in some decrease in personal privacy. The benefits of full disclosure were deemed more important than the concomitant loss of privacy. In this sense, then, "It is an extraordinary piece of antiprivacy legislation”. Easterbrook, Privacy and the Optimal Extent of Disclosure Under the Freedom of Information Act, 9 J Legal Studies 775, 776 (1980). That we might prefer a little more privacy and a little less disclosure does not in any way reduce the deference owed to the Legislature’s statutory expression of the opposite view.
"(5) In an action commenced pursuant to this section, if the circuit court finds that the public body has arbitrarily and capriciously violated this act by refusal or delay in disclosing or providing copies of a public record, the court shall, in addition to any actual or compensatory damages, award punitive damages in the amount of $500.00 to the person seeking the right to inspect or receive a copy of a public record. The damages shall not be assessed against an individual, but shall be assessed against the next succeeding public body, not an individual, pursuant to whose public function the public record was kept or maintained.”
Note that the attorney-fee provisions of the federal FOIA are substantially different:
"The court may assess against the United States reasonable attorney fees and other litigation costs reasonably incurred in any case under this section in which the complainant has substantially prevailed.” 5 USC 552(a)(4)(E).
The federal provision differs from the Michigan provision in at least two material respects. First, it never requires that attorney fees be awarded, but instead grants the court broad discretion in awarding or denying attorney fees. Second, it requires that the plaintiff substantially prevail even to become eligible for an award of attorney fees, while our provision only requires that the plaintiff prevail in part. Federal authority interpreting the federal FOIA attorney-fee provision therefore provides little if any assistance in interpreting the Michigan statute.
Upon remand, the circuit court shall consider the plaintiffs claim for $500 punitive damages in light of 1978 PA 329, immediately effective July 11, 1978, which amended MCL 15.235(3); MSA 4.1801(5)-(3) to read as follows:
"Failure to respond to a request as provided in subsection (2) constitutes a final decision by the public body to deny the request. If a circuit court, upon an action commenced pursuant to section 10, finds that a public body has failed to respond as provided in subsection (2), and if the court orders the public body to disclose or provide copies of the public record or a portion thereof, then the circuit court shall assess damages against the public body as provided in section 10(5).” | [
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Blair Moody, Jr., J.
On April 30, 1973, the academic senate of Central Michigan University passed a resolution adopting a teaching effectiveness program which provided that students, as well as department faculty, evaluate the faculty members. Although the form of and weight to be given the student evaluations in department recommendations were not specified, the program did provide that "[departmental recommendations for reappointment, promotion and tenure should be accompanied by evidence of teaching effective-
On January 28, 1974, the Central Michigan University Faculty Association charged the university with an unfair labor practice. The faculty association claimed that Section I of the teaching effectiveness program was a mandatory subject of collective bargaining and, therefore, it was impermissible for the university to unilaterally adopt the program.
Administrative Law Judge Schlomo Sperka upheld the faculty association’s unfair labor practice charge, finding that the university had violated § 10 of the public employment relations act (hereinafter PERA) by unilaterally adopting and implementing the teaching effectiveness program without bargaining with the exclusive, certified collective bargaining agent of its faculty.
The university appealed to the Michigan Employment Relations Commission (hereinafter MERC). In a split decision, the two-member majority reversed Judge Sperka’s decision and dismissed the unfair labor practice charge. After discussing the difference between institutions of higher learning and other public employers as related to the scope of bargaining, the MERC majority found the program in question to be predominantly a matter of educational policy and not mandatorily negotiable. MERC reasoned that since Central Michigan University derives its existence from constitutional authority, § 15 of the PERA does not have full application when applied to university employees. Const 1963, art 8, § 6.
The Court of Appeals, over the dissent of the Honorable Michael F. Cavanagh, upheld the MERC decision. 75 Mich App 101; 254 NW2d 802 (1977). We granted leave to appeal. 401 Mich 831 (1977).
I
The issue on this appeal is whether the elements, procedures and criteria involving evaluations for purposes of reappointment, retention and promotion are "other terms and conditions of employment” within the meaning of the PERA. The crux of this issue is the question whether the nature of the public employment alters the scope of mandatory bargaining.
It is well settled that Michigan’s institutions of higher education are public employers subject to the provisions of the PERA. Board of Control of Eastern Michigan University v Labor Mediation Board, 384 Mich 561; 184 NW2d 921 (1971); Regents of the University of Michigan v Employment Relations Comm, 389 Mich 96; 204 NW2d 218 (1973). The duty of a public employer to bargain collectively with the employees’ representative is set forth in § 15 of the PERA, patterned after § 8(d) of the National Labor Relations Act (hereinafter NLRA). Section 15 provides, in relevant part:
"A public employer shall bargain collectively with the representatives of its employees as defined in section 11 and is authorized to make and enter into collective bargaining agreements with such representa tives. For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment.” MCL 423.215; MSA 17.455(15).
In both the PERA and NLRA, the collective bargaining obligation is defined as the mutual duty of labor and management to bargain in good faith with respect to "wages, hours, and other terms and conditions of employment”. The subjects included within the phrase "wages, hours, and other terms and conditions of employment” are referred to as "mandatory subjects” of bargaining. Once a specific subject has been classified as a mandatory subject of bargaining, the parties are required to bargain concerning the subject, and neither party may take unilateral action on the subject absent an impasse in negotiations. See generally Morris, ed, The Developing Labor Law, (Washington, D C: Bureau of National Affairs, Inc, 1971), chs 14-16; National Labor Relations Board v Wooster Division of Borg-Warner Corp, 356 US 342; 78 S Ct 718; 2 L Ed 2d 823 (1958); Fibreboard Paper Products Corp v National Labor Relations Board, 379 US 203; 85 S Ct 398; 13 L Ed 2d 233; 6 ALR3d 1130 (1964).
The United States Supreme Court has concluded that one of the primary purposes of the NLRA is labor relations peace and that this objective can best be achieved by adopting a liberal approach to what constitutes a mandatory subject of bargaining. See, for example, Fibreboard Paper Products, supra. Following the Federal courts’ approach, Michigan has adopted a broad view of "other terms and conditions of employment”. See, for example, Van Buren Public School Dist v Wayne Circuit Judge 61 Mich App 6; 232 NW2d 278 (1975).
In Detroit Police Officers Ass’n v Detroit, 391 Mich 44, 55; 214 NW2d 803 (1974), this Court looked to the private sector for examples of mandatory subjects of collective bargaining and found:
"[S]uch subjects as hourly rates of pay, overtime pay, shift differentials, holiday pay, pensions, no-strike clauses, profit sharing plans, rental of company houses, grievance procedures, sick leave, work-rules, seniority and promotion, compulsory retirement age, and management rights clauses, are examples of mandatory subjects of bargaining. ” (Emphasis added.)
Furthermore, after looking to Federal precedent, the Court of Appeals recently held that the subject of promotional standards and the criteria for those standards are mandatory subjects of collective bargaining. See Detroit Police Officers Ass’n v Detroit, 61 Mich App 487; 233 NW2d 49 (1975), lv den 395 Mich 756 (1975).
In the instant case we are asked whether the elements, procedures and criteria involving evaluations for purposes of reappointment, retention and promotion are "other terms and conditions of employment”. MCL 423.215; MSA 17.455(15). We conclude that reappointment, retention and promotion criteria are "other terms and conditions of employment” and are a mandatory subject of collective bargaining.
II
Having reached this conclusion, we must now address the critical question whether the nature of the public employment alters the scope of the collective bargaining obligation of particular public employers. The university makes essentially a two-fold argument for excluding the procedures and criteria for reappointment, retention and promotion from the mandatory subject category to which they would otherwise belong. First, the university maintains that the unique status accorded the state universities by constitutional and statutory authority justifies excluding the subject of promotion and retention evaluation criteria from the scope of the mandatory bargaining obligation.
This argument, that specific public employers should be insulated from the collective bargaining obligation of the PERA because of constitutional and statutory grants of authority, was recently advanced in Pontiac Police Officers Ass’n v Pontiac, 397 Mich 674; 246 NW2d 831 (1976). In that case, the municipality of Pontiac argued that to require bargaining concerning grievance and arbitration procedures would interfere with the constitutional and statutory powers vested in home-rule cities. Although three separate opinions were written in that case, all the justices taking part in the decision agreed that the public employer’s duty to bargain collectively pursuant to the PERA prevails over conflicting provisions of the charter of a home-rule city.
Therefore, we have previously held that the PERA was intended by the Legislature to supersede conflicting laws and is superimposed even on those institutions which derive their powers from the Constitution itself. The Legislature in adopting the very words of the NLRA chose to adopt the industrial model for public sector collective bargaining. In decreeing that "wages, hours, and other terms and conditions of employment” are mandatory subjects of collective bargaining, the Legislature focused on the effect a particular aspect of the employment relationship has on the employees’ status, not the effect it has on the "business”, i.e., the effect on educational policies. The statutory test of the PERA is whether the particular aspect of the employment relationship is a "term or condition of employment”. Under the act, a particular aspect of the employment relationship is a mandatory subject of collective bargaining, even if it may be siaid to be only minimally a condition of employment.
As stated in Justice Levin’s opinion in Pontiac Police Officers Ass’n, supra:
"If the Legislature deems it appropriate to redefine the scope of the collective bargaining obligation of the public employers generally or of particular public employers and the representatives of their employees to include 'wages, hours, and some other terms and conditions of employment’, it may do so.
"This Court cannot properly decide ad hoc that what has uniformly been regarded a 'condition’ of employment is not such a condition as applied to a particular public employer although it continues to be such a condition for other employers, public and private. By eschewing redefinition, we underscore the prerogative of the Legislature to give such consideration as it deems warranted to the claims of public employers that the scope of the collective bargaining obligation impinges unduly on their power to govern.” Pontiac Police Officers Ass’n, supra, 684.
Clearly, the PERA was intended to cover all public employees except for civil service employees specifically excluded by constitutional provision. Nearly every conceivable type of job and profession is covered by collective bargaining agreements under the PERA. If institutions of higher education are indeed different from other public employers, the Legislature could have specifically excluded them from coverage under the PERA. Any exemption or exclusion of public employers from the PERA is the Legislature’s prerogative, not that of MERC or the appellate courts.
As a result, we find the unique status accorded state universities by constitutional and statutory authority does not alter the scope of their collective bargaining obligation under the PERA. If university professors are truly unique and thus different from other public employees, the Legislature must carve out an exception to the PERA. This Court cannot.
Ill
Alternatively, the university contends that the incorporation of student evaluations into the criteria for faculty promotion and retention is predominantly a matter of education policy and, therefore, outside the arena of mandatory collective bargaining. We are urged that the case of Regents of the University of Michigan v Employment Relations Comm, 389 Mich 96; 204 NW2d 218 (1973), supports this position. The language from that case, of significance to this dispute, states:
"Because of the unique nature of the University of Michigan, * * * the scope of bargaining by the Associa tion may be limited if the subject matter falls clearly within the educational sphere. Some conditions of employment may not be subject to collective bargaining because those particular facets of employment would interfere with the,, autonomy of the Regents. For example, the Association clearly can bargain with the Regents on the salary that their members receive since it is not within the educational sphere. While normally employees can bargain to discontinue a certain aspect of a particular job, the Association does not have the same latitude as other public employees. For example, interns could not negotiate working in the pathology department because they found such work distasteful. If the administrators of medical schools felt that a certain number of hours devoted to pathology was necessary to the education of the intern, our Court would not interfere since this does fall within the autonomy of the Regents under Article 8, § 5.” Regents, supra, 109. (Emphasis added.)
Thus, the scope of collective bargaining is limited only if the subject matter "falls clearly within the educational sphere”. In the instant case, the procedures and criteria adopted affect the retention, tenure and promotion of faculty members. These are clearly matters within the employment sphere, crucial to the employer-employee relationship. They are not matters within the educational sphere as that phrase was used in Regents, supra.
We agree with the analysis of Court of Appeals dissenter Judge Michael Cavanagh:
"I cannot agree * * * that evaluative criteria for purposes of tenure and promotion are strictly 'educational policy’. This matter bears directly on the means by which the administration will determine whether or not untenured faculty members will continue their positions. Surely the criteria for that decision are important to the members of the bargaining unit. While evaluation of teaching effectiveness is not a trivial element of the university’s education program, I cannot perceive the method of that evaluation to be integral to the university’s mission: to educate. I would strike the balance in favor of the limited obligation to bargain before unilateral imposition of new criteria. This would not block the ultimate adoption of stñdent evaluations as part of the criteria of teaching effectiveness; it would merely impose the reasonable burden upon the university to consult the association and discuss the program before its implementation.” (Emphasis added.) Central Michigan University Faculty Ass’n, supra, 114.
Consequently, we reverse the MERC and Court of Appeals majority opinions and reinstate the decision and recommended order of the Administrative Law Judge.
Kavanagh, C.J., and Williams, Levin, and Ryan, JJ., concurred with Blair Moody, Jr., J.
Coleman, J.
This appeal concerns the scope of mandatory collective bargaining in public institutions of higher education. A program prpmoting teaching effectiveness developed by the Academic Senate of Central Michigan University provides the backdrop for the dispute. An element of the program was an intradepartmental evaluation of each faculty member’s teaching effectiveness, with some student input. The information obtained was to be made available to the evaluee and those persons making recommendations or decisions regarding reappointment, tenure and promotion.
The program was adopted by the Academic Senate after three years of deliberations and was implemented in various departments before referral to the University Board of Trustees for ratification.
Subsequent to the adoption of the program by the Board of Trustees, the Central Michigan University Faculty Association (Association) filed an unfair labor practice charge against the University. The Association contended that the evaluative criteria and procedures constituted "wages, hours, and other terms and conditions of employment”, MCL 423.215; MSA 17.455(15), and were, therefore, mandatory subjects of collective bargaining. Formal adoption of the teaching effectiveness program and its implementing recommendations was alleged to violate § 10 of the public employees relations act (PERA), MCL 423.210; MSA 17.455(10).
The administrative law judge upheld the Association’s charge. The Michigan Employment Relations Commission (MERC) determined, however, that the program was "predominantly a matter of education policy not mandatorily negotiable”. Consequently, MERC reversed the decision of the administrative law judge and dismissed the complaint. The Court of Appeals affirmed MERC’s decision. 75 Mich App 101; 254 NW2d 802 (1977).
We also agree with MERC. The particular facts of this case create issues which impact predominantly upon educational policy rather than upon conditions of employment. The industrial format of PERA presents some difficulties in application to collegial schemes of higher education such as this, in which the faculty is greatly involved in University governance and in which there is also some student input, but the difficulties are not insurmountable. MERC considered the competing policies and correctly decided the case on its facts. We therefore affirm.
I
Central Michigan University is a state institution of higher education. Pursuant to Const 1963, art 8, § 6, it is governed by a Board of Trustees appointed by the Governor. The constitutional grant of supervisory power to the board was implemented by the Legislature. MCL 390.551 et seq.; MSA 15.1120(1) et seq. However, this Court has consistently ruled that PERA applies to state universities.
The forerunner of the existing Academic Senate of Central Michigan University was first established in 1946 and a similar body has existed continuously ever since. On May 20, 1970, the current Academic Senate was formed. It was composed of some 41 faculty members elected by their departmental peers, 15 representatives of the administration (all deans plus the University President and Vice President) and 6 student representatives, elected by the Student Senate. As stated in the preamble to the Senate’s Constitution, the basic purpose of the Senate is to "provide a legislative body in the University in which representa tives of the Faculty can deliberate in the determination of academic policies”.
The Academic Senate is the principal academic (or educational) policy-making body of the University. Some concerns delineated in its Constitution are: admissions, curriculum, degree requirements, faculty participation in selection of administrators, academic freedom, issues of faculty welfare (salaries, insurance, vacations, etc.), University financial policies and planning, and standards for faculty appointment, promotion and tenure. In this way, the faculty of the University takes an active role in what would traditionally be considered management functions in a different setting. The Board of Trustees, while cloaked with de jure responsibility and authority, has delegated much of its role to the Academic Senate. The faculty thus shares authority over many management areas with the board. Indeed, the testimony of Dr. William B. Boyd, President of the University, makes it clear that the teaching effectiveness program became University policy upon passage by the Senate and would have remained so even without the imprimatur of the board.
Since the representative election of September 24, 1969, the Association has been the exclusive bargaining representative for the University faculty. This status was reaffirmed by a collective bargaining agreement covering the period from May 21, 1971 to June 30, 1974. As such, the Association is the agent of the faculty and the University must negotiate with it concerning "wages, hours, and other terms and conditions of employment”. MCL 423.215; MSA 17.455(15).
The concept that each academic department should establish a program promoting teaching effectiveness was first proposed to the University Senate (the immediate predecessor to the Academic Senate) on March 23, 1970. The Ad Hoc Committee on Evaluating Teaching Effectiveness was formed on April 27, 1970 and its report was submitted to the Senate on February 22, 1971. The report was then referred to all departments for evaluation, discussion and implementation.
Subsequently, a second committee was authorized to study and make recommendations concerning implementation of the program. This report was submitted on September 25, 1972. The University alleges that high-ranking Association members participated in "shaping the Senate’s course of action” during the three years prior to the program’s adoption. Also, a new labor agreement was adopted during that period (1971-1974) when everyone concerned had notice. Plaintiff says that makes no difference. The program, "Teaching Effectiveness — Implementing Recommendations”, was formally adopted by resolution of the Academic Senate on April 30, 1973. The University Board of Trustees ratified the program verbatim on August 15, 1973, without any formal notification to or discussion with the Association. The Association filed its unfair labor practice charge on January 28, 1974.
The charge alleged that the unilateral adoption of the program violated the mandatory bargaining aspects of PERA. Specific complaints were directed at Part I, which reads:
"I. Implementing recommendations: for departments.
"a. Each academic department should establish not later than one year after the approval of this recommendation, a systematic program for (a) evaluating and (b) improving teaching effectiveness of every faculty member in the department.
"b. All faculty members of the department should participate in determining the instruments and procedures involved in the evaluative process.
"c. Students as well as departmental faculty should evaluate the faculty of said department.
"d. Information obtained about an individual faculty member should be made available to that individual faculty member and to those individuals having the responsibility of making recommendations and/or decisions regarding reappointment, merit pay, tenure, and promotion.
"e. Departmental recommendations for reappointment, promotion and tenure should be accompanied by evidence of teaching effectiveness. This is not to limit the accompanying evidence to data on teaching effectiveness.”
Particular concern was expressed over the alleged mandatory inclusion of student evaluations. A student opinion survey had been in existence since 1968. Its use was optional with any particular department. Some departments used the data obtained from the student evaluations when making recommendations regarding faculty reappointment and tenure, while other departments did not consider student opinions.
The Association has made it clear that only Part I of the program is challenged. No objection is proffered concerning the concept of the teaching effectiveness program itself. The charge was directed solely at the unilateral institution of these evaluations as an element of the decision-making process in areas of reappointment, tenure, and promotion (and, allegedly, merit pay).
Although the document at issue purports to apply to merit pay, such was not actually the case. The mechanism for allocating merit increases was controlled by the collective bargaining agreement. The agreement established a University Achievement Increase Committee to develop procedures and criteria for selecting recipients and amounts subject to the approval of the Association and the University. 1971-1974 Agreement, p 28.
Therefore, we will be concerned only with the program’s effect upon reappointment, tenure, and promotion.
II
We are asked to decide whether Part I of the teaching effectiveness program is a mandatory subject of collective bargaining, as distinct from a permissive or illegal subject. The Court has recently defined these terms as having the same meaning under PERA as under the NLRA:
"Mandatory subjects of collective bargaining are those within the scope of 'wages, hours, and other terms and conditions of employment’. [MCL 423.215; MSA 17.455(15).] If either party proposes a mandatory subject, both parties are obligated to bargain about it in good faith.
"Permissive subjects of collective bargaining are those which fall outside the scope of 'wages, hours, and other terms and conditions of employment’, and may be negotiated only if both parties agree.
"Illegal subjects are those which even if negotiated will not be enforced because adoption would be violative of the law or of the NLRA.” Pontiac Police Officers Ass’n v Pontiac, 397 Mich 674, 679; 246 NW2d 831 (1976).
Detroit Police Officers Ass’n v Detroit, 391 Mich 44, 54; 214 NW2d 803 (1974). See generally Fibreboard Paper Products Corp v National Labor Rela tions Board, 379 US 203; 85 S Ct 398; 13 L Ed 2d 233 (1964), National Labor Relations Board v Borg-Warner Corp, 356 US 342; 78 S Ct 718; 2 L Ed 2d 823 (1958).
Therefore, the issue is whether Part I of the program encompasses mandatory or permissive subjects of bargaining. To sharpen the issue further, we accept MERC’s statement that:
"The scope of bargaining issues in educational institutions has been presented in terms of whether an employer’s action or activity is educational policy or a condition of employment. The PERA bargaining obligation, under this theory, applies only to the latter. Under this theory, the issue may be framed in the alternative. If the portion of the 'Teaching Effectiveness —Implementing Recommendations’ document to which objection is made by the Association is educational policy, the University Board of Trustees had power to adopt and implement it. If, on the other hand, Item I of the 'Teaching Effectiveness — Implementing Recommendations’ document is a condition of employment, PERA requires collective bargaining before adoption by the Board of Trustees.”
The evaluative criteria and procedures, as an element of the teaching effectiveness program— but also bearing upon faculty reappointment, tenure, and promotion — fall into that area of overlap and conflict between the uncontroverted extremes of "educational policy” and "employment conditions”. The growth of litigation testing the scope of the bargaining obligation in the public sector of higher education suggests that the majority of disputed items fall into this zone of overlap.
We note that the governing system employed at the University places members of the faculty on both sides of the bargaining table. They make many management decisions within the Academic Senate structure and yet are represented by the Association which challenges these same decisions. The teaching effectiveness program was originated and developed within the Senate structure but is challenged as a creature of the University.
Ill
As noted above, many courts recently have been asked to decide issues concerning the scope of mandatory bargaining in the public sector. Two basic approaches for resolving the problem have evolved.
Some courts* *** have required bargaining whenever employer actions "significantly relate to”, "concern” or "materially affect” conditions of employment. Because this type of test for determining the scope of the bargaining obligation is inherently biased toward mandatory negotiability, it has been observed that:
"This standard ['significant relation’ standard] is inadequate because it does not properly recognize the competing interests at stake where there is an overlap between conditions of employment on the one hand and management prerogatives on the other. By focusing on only one-half of the overlap problem, this standard gives undue weight to conditions of employment.” Clark, The Scope of the Duty to Bargain in Public Employment, Labor Relations Law in the Public Sector (Knapp, ed, 1977), p 92.
Other courts have adopted a test which attempts to weigh the effects on both management and union prerogatives — the balancing test. The Oregon Court of Appeals recently stated that:
"[T]he appropriate test to be applied in determining whether a proposed subject is a 'condition of employment’ and therefore a mandatory subject of bargaining is to balance the element of educational policy involved against the effect that the subject has on a teacher’s employment.” Sutherlin Education Ass’n v Sutherlin School District No 130, 25 Or App 85, 88; 548 P2d 204, 205 (1976).
Courts in Kansas, Pennsylvania and Alaska have also found the balancing standard to be appropriate. We further note that MERC has previously recognized the advantages of the balancing test. In Westwood Education Ass’n v Westwood Community Schools, 7 MERC Lab Op 313, 320 (1972), the majority stated that "[a] balancing approach to bargaining may be more suited to the realities of the public sector than the dichotomized scheme — mandatory and non-mandatory — used in the private sector”.
We find that the balancing approach is an evenhanded method for resolving scope questions. It "acknowledges that both parties have significant interests at stake” and "is well suited to a case by case determination of negotiability because it does not begin with a bias”. Clark, supra, pp 94-95. Such an approach is particularly appropriate to public sector decision-making in institutions of higher education because of variables not present in the private sector. Therefore, we determine that issues of the scope of mandatory collective bargaining in higher education under PERA shall be resolved by weighing the effects of a given subject upon educational policies against the effects upon the faculty member’s interest in "wages, hours, and other terms and conditions of employment”.
IV
The document challenged as to Part I states that each academic department should develop a program for evaluating and improving the teaching effectiveness of every faculty member. Student opinions are included as one element of the evaluative process. No particular weight is required. Departmental recommendations "should be” accompanied by "evidence of teaching effectiveness”. Such evidence is not limited.
The thrust of Part I is to require documentation of teaching effectiveness so that the individual can have access to concrete bases for a department’s recommendation and can be encouraged to improve specific defects. There is nothing novel in using professional rewards (promotion, tenure, reappointment) as a mode of encouragement. Teaching effectiveness data, albeit in a less systematic or above-board fashion, has always been a part of the decision-making process at the University when faculty members seek promotion, tenure or reappointment.
The controversial feature of Part I is the inclusion of student opinions as one element of the evaluation process. All other elements, criteria and procedures are to be developed by each individual department. Moreover, the weight to be given each piece of information when making recommendations is left to the departments. The departments are free to formulate the student evaluation process in any manner they choose. Therefore, the faculty, in their departmental settings, have primary control over implementation of the evaluations and their use.
It is not disputed that the decision to implement a program promoting teaching effectiveness constitutes educational policy. The Association’s position is that the elements, criteria, and procedures of the evaluation process affect conditions of employment (reappointment, tenure and promotion) and therefore require prior bargaining. Assuming, arguendo, that reappointment, tenure and promotion are conditions of public employment, we discern only a minimal effect from provisions of the evaluation process adopted by the University.
The only part of the evaluation process which is not left to subsequent faculty formulation is some use of student opinions. However, even the form of and weight to be given the student evaluations in departmental recommendations are left to the faculty. The impact upon conditions of employment from this requirement cannot be said to be anything more than minor, particularly when one notes that departments were using student evaluations in a similar fashion prior to adoption of the program in issue.
Utilization of student evaluations recognizes that those being taught are in a unique position to perceive whether the teacher, for instance, has adequate knowledge of the subject matter and can transmit it to a student, whether a student’s appetite for learning and for the process of learning is whetted or blunted, and whether the class participant is bored, discouraged, submerged or inspired. Therefore, student input provides a perspective of educational effectiveness not otherwise available. As such, it is a desirable although not determinative element of a program seeking to improve the quality of education. Moreover, it is a continuation of the growing nationwide acceptance of the student’s role in sharing responsibility and even some authority in institutions of higher education. See Campus Employment Relations, Part V: Student Involvements (Tice, ed, Ann Arbor: Institute of Continuing Legal Education, 1976).
Perhaps some tension derives from the fact that an individual’s evaluation of teaching effectiveness must by its nature be subjective. Some students may actually be unfair, but that is not a trait exclusive to a few among a predominantly adult group who happen to be students. This may be why the Senate provided such great flexibility in the use by the faculty of all criteria and why all departmental recommendations and supporting material must be provided to the person being evaluated. The core concern is the quality of education — from which the quality of teaching is inseparable.
At the University, the objectives and methods of enhancing the excellence of higher education and assisting the faculty toward effective teaching are within the ambit of educational policy.
We find, therefore, that Part I of the teaching effectiveness program impacts heavily upon matters of educational policy and only peripherally upon conditions of employment. Consequently, it is not a subject of mandatory collective bargaining.
V
Our holding is in accord with decisions in other jurisdictions. In Association of New Jersey State College Faculties, Inc v Dungan, 64 NJ 338; 316 A2d 425 (1974), the New Jersey Supreme Court held that a unilateral implementation of a program for granting tenure and evaluating tenured faculty, including student input, was a matter of major educational policy. The New Jersey version of PERA also requires bargaining over "terms and conditions of employment”. 34 NJ Stat Ann 13A-5.3. The Court suggested, however, that it would have been better labor relations policy to have discussed the program with the faculty prior to implementation. We note that the Central Michigan University program was developed exclusively by the Academic Senate itself over a three year period.
An analogous issue was decided by the New York Public Employee Relations Board in In the Matter of Board of Higher Education of City of New York, 7 PERB ¶ 7-3028, p 3042 (1974). After consultations with the faculty union, the Faculty Senate and the Student Senate, the board implemented student participation on the Personnel and Budget Committees of City University of New York. These committees recommended faculty reappointment, tenure and promotion. During subsequent contract negotiations, the faculty union demanded that the students be barred from the committees. The PERB held that student representation was not a subject of mandatory bargaining and noted:
"There is a difference between the role of college teachers as employees and their policy-making function which goes by the name of collegiality. Unlike most employees, college teachers function as both employees and as participants in the making of policy. Because of this dual role, it has been argued elsewhere that they are not entitled to representation in collective bargaining. In Matter of Fordham University, [193 NLRB 134; 78 LRRM 1177 (1971)], the National Labor Relations Board dismissed this challenge to the right of college teachers to representation and pointed out that the two types of interests of college teachers are compatible because they are addressed in different institutional structures. The NLRB specifically noted that the policy-making responsibilities of college teachers are exercised through academic committees and faculty senates, while they remain employees for the purpose of determining their terms and conditions of employment under the National Labor Relations Act.
"We, too, distinguish between the role of faculty as employees and its role as a participant in the governance of its colleges. * * * The right of the faculty to negotiate over terms and conditions of employment does not enlarge or contract the traditional prerogatives of collegiality; neither does it subsume them. These prerogatives may continue to be exercised through the traditional channels of academic committees and faculty senates * * *. We note with approval the observation that, 'faculty must continue to manage, even if that is an anomaly. They will, in a sense, be on both sides of the bargaining table’. We would qualify this observation, however; faculty may be on both sides of the table, but not their union.”
VI
The present trend of student and faculty involvement in university governance is a fact in our time of rapid change which must be squarely faced. The New York PERB in Board of Higher Education, supra, directs attention to the fact that student participation in faculty evaluation recog nizes the interests of those other than employer and employee:
"It would be a perversion of collective negotiations to impose it [mandatory bargaining] as a technique for resolving such disputes and thus disenfranchising other interested groups.”
Although there is logic in some of the arguments that collective bargaining in an institution of higher education will eventually eliminate collegiality and block out social and educational interests of any but the employer and employee, we believe it possible to have an external bargaining agent without atrophy of academic agencies such as the Senate.
The balancing test assures, so far as possible, a fair resolution of competing statutory, constitu tional and policy considerations. It is an appropriate instrument for piercing the veil of the "gray area” of overlapping responsibilities, objectives and interests.
In the balancing, we can afford some weight to the role of students whose interest as ultimate beneficiaries of University education is real. The prerogatives and autonomy of the board, as appointed public officials, are also given equal consideration with the interests of the faculty. This result is of particular importance given the inherent political nature of collective bargaining in the public sector.
With the Alaska Supreme Court, we are persuaded that it is in the public interest to guard against a shift in the control of educational policy from the boards to the unions through successive rounds of bargaining. That Court said:
"Such a result could threaten the ability of elective government officials and appointive officers subject to their authority * * * to perform their functions in the broad public interest.” Kenai Peninsula Borough School District v Kenai Peninsula Education Ass’n, 572 P2d 416, 419 (Alaska, 1977).
We are mindful that our adoption of the balancing test requires some consideration of the scope of bargaining in public institutions of higher learning on a case-by-case basis. This is a proper result, however, given the diversity of such public institutions and student-faculty relationships. It is difficult to compare the shared authority and collegiality of higher education with the aggressive confrontation prevalent between cities and their pub- lie employee unions and we make no attempt to do so.
Because MERC’s opinion employs the balancing test here approved, we find no procedural or substantive purpose in a remand to weigh opposing interests. The MERC majority in summation said:
"Consistent with the holdings in other jurisdictions and based on the record as a whole, we find that the documentation of teaching effectiveness is predominantly a matter of educational policy not mandatorily negotiable.” (Emphasis added.)
The governing system of shared authority and collegiality existing at Central Michigan University is both appropriate to excellence in higher education and conducive to good faculty-administration-student relations. Furthermore, we find that the role to be played by students in governing the University is a matter of educational policy and within the discretion of the board. Consequently, we agree with both MERC and the Court of Appeals.
Affirmed.
Fitzgerald, J., concurred with Coleman, J.
Section 8(d) of the NLRA, 29 USC 158(d) provides:
"For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession.”
Because of the virtually identical language of the two acts, this Court has concluded that the Michigan Legislature intended that Federal precedent would be given great weight in interpreting § 15 of the PERA. Detroit Police Officers Ass’n v Detroit, 391 Mich 44; 214 NW2d 803 (1974).
Const 1963, art 8, §§ 5, 6; Central Michigan University act, MCL 390.554; MSA 15.1120(4).
Const 1963, art 7, §§ 22, 34; home rule cities act, MCL 117.1 et seq.; MSA 5.2071 et seq.
Const 1963, art 4, § 48 provides:
"The legislature may enact laws providing for the resolution of disputes concerning public employees, except those in the state classified civil service.”
The bargaining obligation is set forth in MCL 423.215; MSA 17.455(15):
"A public employer shall bargain collectively with the representatives of its employees as defined in section li and is authorized to make and enter into collective bargaining agreements with such representatives. For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract, ordinance or resolution incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession.”
Section 10, in pertinent part, reads:
"(1) It shall be unlawful for a public employer or an officer or agent of a public employer * * * (e) to refuse to bargain collectively with the representatives of its public employees * * MCL 423.210; MSA 17.455(10).
Regents of University of Michigan v Employment Relations Commission, 389 Mich 96; 204 NW2d 218 (1973), Board of Control of Eastern Michigan University v Labor Mediation Board, 384 Mich 561; 184 NW2d 921 (1971).
A dispute over whether the provisions of Part I of the program are imperative or precatory (should versus shall) in nature has fluttered in and out of this litigation. MERC held that the language was only precatory as an alternate basis for dismissing the complaint. The Court of Appeals did not address the issue.
This Court has admittedly also used a similar type of analysis when deciding scope questions in the past. E.g., Pontiac Police Officers Ass’n v Pontiac, 397 Mich 674, 681; 246 NW2d 831 (1976), Detroit Police Officers Ass’n v Detroit, 391 Mich 44, 58; 214 NW2d 803 (1974). By changing our analytic approach for institutions of higher education, as will be discussed infra, we do not intimate that past cases would be decided differently in the future.
E.g., Clark County School Dist v Local Government Employee-Management Relations Board, 90 Nev 442; 530 P2d 114 (1974), Aberdeen Education Ass’n v Aberdeen Board of Education, 88 SD 127; 215 NW2d 837 (1974), Allied Chemical & Alkali Workers v Pittsburgh Plate Glass Co, 404 US 157, 178-179; 92 S Ct 383; 30 L Ed 2d 341 (1971) (private sector). See, also, Los Angeles County Employees Ass’n, Local 660 v Los Angeles County, 33 Cal App 3d 1; 108 Cal Rptr 625 (1973).
National Education Ass’n of Shawnee Mission, Inc v Board of Education of Shawnee Mission, 212 Kan 741, 753; 512 P2d 426, 435 (1973), Pennsylvania Labor Relations Board v State College Area School Dist, 461 Pa 494, 507; 337 A2d 262 (1975), Kenai Peninsula Borough School Dist v Kenai Peninsula Education Ass’n, 572 P2d 416, 422-423 (Alaska, 1977). (Although the Alaska court did not expressly adopt the balancing test, it is clear that the court approved of and used the test.)
If a faculty union could require bargaining over any subject which affected employment conditions, the role of a faculty legislative body would disappear over time. Professor Brown has described the problem as follows:
"Some statutes contain limitations on the scope of bargainable issues, but neither the limitations nor the generalization meets the special problem of a university faculty. That problem, stripped to its essentials, is to prevent the pervasive and traditional areas of faculty academic authority from being absorbed into the newly created collective bargaining process. Once a bargaining agent has the weight of statutory certification behind it, a familiar process comes into play. First, the matter of salaries is linked to the matter of workload; workload is then related directly to class size, class size to range of offerings, and range of offerings to curricular policy. Dispute over class size may also lead to bargaining over admissions policies. This transmutation of academic policy into employment terms is not inevitable, but it is quite likely to occur. Thus, an expert task force of the American Association for Higher Education, in a calm appraisal of the pros and cons of industrial-style collective bargaining for higher education, concluded that an academic agency such as a faculty senate would probably 'atrophy’ in the shadow of an external bargaining agent. If the faculty considers such an outcome undesirable, it is possible to argue that the bargaining agent, whether external or internal, is after all under the faculty’s control — a majority can in due course repudiate it and choose a new one. But this may be easier prescribed than accomplished.” Brown, Collective Bargaining in Higher Education, 67 Mich L Rev 1067, 1075-1076 (1969).
See, e.g., Summers, Public Employee Bargaining: A Political Perspective, 83 Yale L J 1156 (1974); Project, Collective Bargaining and Politics in Public Employment, 19 UCLA L Rev 887 (1972).
See Leslie, Faculty in Governance: A Rationale, Campus Employment Relations (Tice, ed, Ann Arbor: Institute of Continuing Legal Education, 1976), p 171. | [
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McGregor, J.
Defendant was tried and convicted of armed robbery, in the Recorder’s Court for the city of Detroit, from which he appeals.
Defendant was accused of robbing a gasoline station on June 21, 1967. Two employees, res gestae witnesses, were present at the time of the robbery and both had ample opportunity to view the gunman.
Shortly after the robbery, the two witnesses went to police headquarters to try to identify the gunman from photographs in police files. After an exten sive search, one of the witnesses identified the defendant from one of the photographs. This initial identification was corroborated by the other witness. Two and one-half months later, at a shownp, both witnesses identified the defendant as the gunman.
Although both witnesses had been indorsed on the information, only one testified at the trial. After a subpoena for the other had been returned unanswered, police learned that he had moved to Chicago. Several days before the trial, police wrote to him at his last known Chicago address, but no response was received. Efforts to phone such witness at the Chicago address were also unsuccessful.
The evidence presented at trial consisted of the complaining victim’s identification and testimony. Defendant offered several alibi witnesses who testified that he had been at a party at the time of the crime.
Defendant contends that the prosecution’s failure to produce an indorsed res gestae witness was reversible error. In People v. Barker (1969), 18 Mich App 544, 548, the Court said:
“The indorsement of the name of a witness on the information either voluntarily or under order, as in this case, creates a duty in the prosecution to produce such witness at the trial, and the defendant may rely upon the prosecutor to fulfill the obligation. People v. Lummis (1932), 260 Mich 170; People v. Ivy (1968), 11 Mich App 427, 430.”
In People v. Ivy (1968), 11 Mich App 427, 430, leave to appeal denied 381 Mich 815, it was said:
“The prosecutor may nevertheless be excused from producing the witness (indorsed witness) if he shows due diligence in attempting to produce him.”
In People v. Tiner (1969), 17 Mich App 18, 20, our Court stated:
“This question of diligence in production of indorsed witnesses is a matter within the discretion of the trial court, subject to being overturned on appeal only for clear abuse.”
We find that there was sufficient testimony from which the trial court could conclude that the prosecution had exercised due diligence in attempting to produce this witness.
Defendant also contends that the photographic identification procedures employed in this case deprived him of a fair trial. The facts in brief are that, shortly after the robbery, the eyewitnesses were in the same room at police headquarters, examining different pictures. After one of the witnesses had viewed more than 100 pictures, he indicated that he had found the assailant’s photograph; the other witness then examined the photograph and agreed that it was the gunman.
Defendant contends that the second witness identified the photograph only after it was selected by the first witness, thereby rendering the entire identification procedure “tainted.” The witness who first found the picture of the defendant was unavailable at the trial.
The standard by which photographic identification procedures are to be judged is established by Simmons v. United States (1968), 390 US 377, 384 (88 S Ct 967; 19 L Ed 2d 1247, 1253) :
“[W]e hold that each case must be considered on its own facts, and that convictions based on eyewitness identification at trial following a pretrial identification by photograph will be set aside on that ground only if the photographic identification procedure was so impermissibly suggestive as to give rise to a very substantial likelihood of irreparable misidentification. This standard accords with our resolution of a similar issue in Stovall v. Denno, 388 US 293, 301, 302, (87 S Ct 1967; 18 L Ed 2d 1199, 1206) and with decisions of other courts on the question of identification by photograph.”
The issue is whether the procedures used' in this case were “so impermissibly suggestive as to give rise to a very substantial likelihood of irreparable misidentification.”
An examination of the procedures employed leads us to conclude that defendant’s rights of due process were not violated. The record reveals that the witness had ample opportunity to view the gunman during the robbery. Photographic identification took place approximately five hours after the crime. Although we do not countenance the practice of eyewitnesses viewing photographs in the same room, the record indicates that each witness was viewing photographs from different trays; that, after the first victim remarked that he had found the picture of the robber, the second victim positively corroborated his statement by saying, “it sure is.” Two and one-half months later, the witness identified the defendant at a showup, and again at trial. There is no assertion that the police attempted to influence the witness’s selection of the photograph. Considering the circumstances in this case, we do not find that the identification procedures posed a substantial likelihood of misidentification.
Defendant’s final contention is that the trial judge, sitting without a jury, improperly stated that the other eyewitness, who was not produced at trial, would have corroborated the testimony and identification of the witness who did appear. The trial judge later stated that he would not consider the testimony of anyone not present at the trial:
“* * * but I must pass upon what I have heard and I can’t pass upon that which I did not hear.”
and also said, in considering the testimony of the defendant’s alibi witnesses, and the weight to be accorded to it,
“* * * so I weigh that against [the complaining witness’s] uncorroborated testimony.”
We conclude that the trial judge did not commit reversible error in light of the overall record.
Affirmed.
All concurred.
MCLA § 750.529 (Stat Ann 1970 Cum Supp § 28.797). | [
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Per Curiam.
Defendant was convicted by a jury of taking possession of and driving away a motor vehicle, contrary to MCLA § 750.413 (Stat Arm 1954 Rev § 28.645).
Testimony at trial shows that on August 3, 1968, at about 10:30 p.m., defendant was stopped by two' police officers while driving a car which'subsequent ly was found to be owned by the complaining witness. When questioned by the police, defendant gave a false name and also stated that he did not have the keys to turn off the automobile. In general, defendant’s explanation to police officers regarding his possession of the automobile was incredible.
Further testimony indicated that the automobile had been removed from the custody of the complaining witness without his permission about 5:00 p.m., and on the same day, defendant was seen driving the auto in an erratic manner, after leaving a bar.
On appeal, defendant questions the sufficiency of the evidence used to establish his guilt beyond a reasonable doubt.
The statute in question is quoted herein:
“Any person who shall, wilfully and without authority, take possession of and drive or take away, and any person who shall assist in or be a party to such taking possession, driving or taking away of any motor vehicle belonging to another * * * ” MCLA § 750.413 (Stat Ann 1954 Eev § 28.645).'
The elements of the crime are: (1) possession must be taken, (2) there must be driving or taking away, (3) done wilfully, and (4) without authority. People v. Limon (1966), 4 Mich App 440, 442. In People v. Stanley (1957), 349 Mich 362, 364, the Supreme Court of Michigan commented on the above-quoted statute and said:
“The act in question was intended to punish one who wilfully and without authority takes possession of and drives away another’s motor vehicle. Intent to steal is not an ingredient of the offense.”
and in another case said:
“the defendant need not have physically partid pated in the unlawful taking possession of the car, [but defendant is guilty if] * * * be was assisting in driving it away, knowing it to have been unlawfully taken * * * People v. Murnane (1921),213 Mich 205, 209.
There is testimony that the automobile in question was unlawfully taken from the rightful owner without his consent, and that 5-1/2 hours later the defendant was found driving and in possession of the car without keys. The jury could logically have reasoned or inferred from this and other facts and testimony in the record that defendant had wilfully and without authority either taken possession of the vehicle, or had assisted in so doing, and had unlawfully taken or driven it away.
“If circumstantial evidence satisfies the mind, then it is equal to positive evidence, because it produces the same effect. People v. Vanderpool, 1 Mich N. P. 264.” People v. Gerndt (1928), 244 Mich 622, 632.
“Defendant is not entitled to a redetermination of the facts in this Court; they were settled by the jury and we will not go into their determination so long as there was sufficient evidence presented from which the jury might have found the defendant guilty beyond a reasonable doubt.” People v. Dye (1959), 356 Mich 271, 276.
In People v. Tutha (1936),276 Mich 387, the owner parked his car at 7:30 p.m., returning at 11:30 p.m., and found it gone. Almost two weeks later, police officers observed the defendant in the vehicle, and after a high-speed chase from which defendant escaped, arrested him later that day. The Supreme Court of Michigan affirmed his conviction of unlawfully driving away an automobile, although there was no direct evidence, but only circumstantial evidence, to indicate that the defendant took the vehicle. Similarly, the cases of People v. Limon, supra, and People v. Helcher (1968), 14 Mich App 386, are pertinent to this issue.
“The question of the sufficiency of the evidence is one for the jury unless there is no evidence at all upon a material point * * * . Even where evidence is all circumstantial, if it is such as tends to show the guilt of the defendant, it should be submitted to a jury.” People v. Abernathy (1931), 253 Mich 583, 587, 588.
Affirmed. | [
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R. B. Burns, P. J.
The Detroit Fire Fighters Association, hereinafter referred to as the Association, was granted exclusive recognition as the representative of the city’s uniformed fire fighters in 1965. Negotiations were held and agreements were reached on various matters, but no comprehensive bargaining contract has ever been formally executed between the parties.
Title 4, ch 15, § 12 of the city charter provides:
“Promotions in the fire department shall be based on length of service therein. The officer or employee thereof having served the longest period in any position shall be advanced to fill any vacancy in the next higher position, if he shall have the qualifications therefor.”
In actual practice the most senior employee has almost invariably been promoted.
The commissioners instituted a new procedure for promotions. The Association objected to the new procedure and filed an unfair labor charge with the Michigan Labor Mediation Board. The trial examiner found the commissioners had refused to bargain with the Association as required by § 10(e) of the public employment relations act. MCLA § 423.210(e) (Stat Ann 1965 Rev § 17.455[lOe]).
The Michigan Labor Mediation Board affirmed the findings of the trial examiner and entered an order requiring the commissioners to cease and desist from refusing to bargain with the Association and in addition directed certain affirmative action. The commissioners appealed claiming MCLA § 423.213 (Stat Ann 1968 Eev § 17.455[13]) violates the equal protection clause of the Constitution in that it makes an unlawful classification of fire fighting personnel by making its supervisors part of the rank and file bargaining unit.
MCLA § 423.213 (Stat Ann 1968 Eev § 17.455[13]) provides:
“The board shall decide in each case, in order to insure public employees the full benefit of their right to self-organization, to collective bargaining and otherwise to effectuate the policies of this act, the unit appropriate for the purposes of collective bargaining as provided in section 9e of Act No 176 of the Public Acts of 1939; provided, that in any fire department, or any department in whole or part engaged in, or having the responsibility of, fire fighting, no person subordinate to a fire commission, fire commissioner, safety director, or other similar administrative agency or administrator, shall be deemed to be a supervisor.”
Until the party who assails such classification carries the burden of showing that it does not rest upon any reasonable basis but is arbitrary, we must assume that there was a sound basis for the legislature’s classification. City of Lansing v. Township of Lansing (1959), 356 Mich 641. The Supreme Court has on several occasions recognized that the work and living conditions of firemen are peculiar and unique, justifying a special classification. Grosse Pointe Park Fire Fighters Ass’n v. Village of Grosse Pointe Park (1942), 303 Mich 405; Slatterley v. City of Flint (1964), 373 Mich 102.
The order of the Michigan Labor Mediation Board is affirmed. It is ordered that the City of Detroit Board of Fire Commissioners forthwith carry out the orders of the Michigan Labor Mediation Board, the negotiation to be confined within the restrictions set forth in the city charter.
No costs, a public question being involved.
All concurred. | [
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R. B. Burns, J.
Defendant was tried and convicted by jury on August 16, 1968, of the crime of breaking and entering. MOLA § 750.110 (Stat Ann 1970 Cum Supp § 28.305). Before trial defendant challenged the array of the jury on the ground that it was illegally impaneled. The trial court denied the challenge after a hearing. Defendant appeals this decision and requests a new trial.
The jury that returned the guilty verdict against defendant was selected from a list composed of 52 names comprising the panel of petit jurors for the July, 1968, term of the Kalamazoo County circuit court. This list was in turn selected from a list of some 400 names comprising the entire panel of petit jurors for the July and the following three terms of the circuit court. Defendant claims the jury was illegally impaneled because the composition of the petit jurors for the July term did not exactly reflect the population ratio of the Kalamazoo County political subdivision as determined by the 1960 census. Because of this discrepancy he con jectures that the officials charged with the responsibility of selecting the names of those who were to go on the panel of petit jurors must have acted contrary to statute. But defendant neglects consideration of the fact that the 52 names in question were drawn from a list of some 400 names. Nothing has been submitted to indicate the list of 400 was selected in any other manner than according to law or that it did not reflect the population distribution of the county in its composition. Nor has there been a positive showing that the ratio of the July term was not merely the result of a random selection. The burden to prove that the officials of the county did not comply with the requirements of the law in the selection of jurors at random is on the moving party. Robson v. Grand Trunk W. R. Co. (1966), 5 Mich App 90. Defendant has also failed to substantiate his contentions that there was systematic exclusion of Negroes in the selection of the jury and that the former Michigan statutes on jury selection are unconstitutional. (See footnote 2.) The proofs do not show purposeful or systematic discrimination against Negroes. See Whitus v. Georgia (1967), 385 US 545 (87 S Ct 643; 17 L Ed 2d 599).
Affirmed.
All concurred.
The 1960 census expressed in terms of ratios showed that 36% of the county’s population resided in townships or villages and 64% in the cities, of which Kalamazoo contained 48% of the population. The July term panel’s ratio was 50% from non-city and 50% from cities, of which Kalamazoo was represented hy approximately 30%.
Chapter 12 of RJA, the provisions of which defendant elaims to have been violated, particularly MOLA § 600.1203 (Stat Ann 1962 Rev § 27A.1203) has been repealed and supplanted by the new chapter 13 (MOLA § 600.1301 et sea. [Stat Ann 1970 Cum Supp § 27A.1301 et sea.]). | [
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Lesinski, C. J.
On March 15,1967, defendant was arraigned on a charge of knowingly having in his possession a stolen motor vehicle, MOLA § 257.254 (Stat Ann 1968 Rev § 9.1954). On March 27, 1967, while represented by assigned counsel, defendant waived preliminary examination. On the day trial commenced in the Recorder’s Court of the city of Detroit, the court allowed the prosecution to amend the information to add a count of unlawfully driving away a motor vehicle, MOLA § 750.413 (Stat Ann 1954 Rev § 28.645). On December 8, 1967, the jury found defendant guilty on both counts. Defendant was later sentenced to imprisonment for a period of from 4-1/2 to 10 years on the first count and for a period of from 4-1/2 to 5 years on the second count, sentences to run concurrently.
On appeal defendant alleges that the trial court committed reversible error by allowing the amendment to the information which added the second count, thereby depriving defendant of his right of examination on the second charge. Plaintiff, during oral argument, conceded error on this point. Therefore, the conviction of the defendant on the second count of unlawfully driving away a motor vehicle is reversed and the matter is remanded for arraignment and a new trial.
Defendant also contends the court committed reversible error in allowing testimony regarding defendant’s failure to make a statement following his arrest. Defendant objects to the following testimony by Detective Peter Shaheen on direct examination :
“Q: What did you do when you saw Mr. Hicks ?
“A: I had him sit at a table across from me in one of the interrogation rooms. And my first duty was to hand him a slip which is called a Detroit Police Department Constitutional Eights Certificate of Notification. And I told him to read it and I gave it to him to read.
“Q: Did you inform him of all the constitutional rights he had prior to asking him any questions in regard to this case?
“A: Yes, I did. And I had him read the statement and I asked him if he understood it thoroughly. Then I had him sign it at 8:20 a.m. And I signed it as a witness to his signature.
“Q: Did you inform him he had a right not to say anything about this case?
“A: Yes, I did.
“Q: Did he say anything to you about this case ?
“A: No, he did not make a statement at that time.”
Defendant did not object to this testimony.
Defendant additionally alleges error occurred when he was cross-examined by the prosecutor regarding Jerry Fields. Defendant’s explanation was that he had borrowed the vehicle in question from Fields who claimed that it was his sister-in-law’s automobile and she had permitted him to drive it since she was going to be out of town. The following transpired:
“Q: Who is ‘Jerry’?
“A: His name is G-erald Fields. I call him Jerry. A friend of mine.
“Q: You ever seen Detective Shaheen before?
“A: Yes. I saw him before.
“Q: You ever told him about Gerald Fields before?
“A: No, I didn’t.
“Q: Why?
“Mr. Harper: I object to that, your Honor.
“The Court: Why is that ?
“Mr. Harper: I think Mr. Shaheen testified he had advised him of his constitutional right and he made no statement at all.
“The Court: Yes. I don’t understand your objection, though.
“Mr. Harper: I feel that to ask him why he didn’t is strictly a violation of the right to remain silent.
“The Court: He has the privilege of remaining silent. But he is no longer silent, as I understand it.
“Mr. Harper: But the officer already testified he told him nothing.
“The Court: Absolutely correct. He is on the stand now.
“Mr. Harper: Okay.
“Q': {By Mr. Poehlman) Why didn’t you tell the detective about Mr. Fields?
“A: Well, because I got arrested. I told the police officer that arrested me. It was a friend of mine’s car. When I talked to him, his attitude led me to believe that what I told him wouldn’t do any good at all. So I didn’t tell him anything.”
The essence of the line of questioning indicated above, which was objected to, when read in context with the prior unobjected to questions herein complained of, is to bring before the jury the fact that defendant exercised his constitutional right to remain silent.
In People v. McCrea (1942), 303 Mich 213, 279-286, our Supreme Court held that once a defendant takes the stand he then becomes subject to cross- examination as any other witness. This was true even as to cross-examination regarding grand jury testimony, which disclosed that he had stood upon his constitutional rights. The Court in deciding this point, at p 282, noted the comment by Justice Potter on page 465 of his work on Michigan Evidence, that “By being sworn in his own behalf he waives his constitutional privilege against self-incriminating questions material to the case.”
This rule of law prevailed in Michigan as the rule to be applied in state cases where the defendant takes the stand to testify in his own behalf. Howrever, as early as 1957 in Grunewald v. United States (1957), 353 US 391 (77 S Ct 963; 1 L Ed 2d 931), and later in Stewart v. United States (1961), 366 US 1 (81 S Ct 941; 6 L Ed 2d 84), in cases of Federal prosecution, the Supreme Court ruled that it was improper to allow cross-examination of the defendant so as to reveal that the defendant exercised his Fifth Amendment privileges.
In Malloy v. Hogan (1964), 378 US 1 (84 S Ct 1489; 12 L Ed 2d 653), the Supreme Court expressly held that the Fourteenth Amendment secures against state invasion the same privilege that the Fifth Amendment guarantees against Federal infringement — the right of a person to remain silent unless he chooses to speak in the unfettered exercise of his own will, and to suffer no penalty for such silence.
In Gruenwald, supra, the Court in deciding the propriety of allowing the complained of cross: examination, stated as follows at p 421: .. .
“Recent re-examination of the history and meaning of the Fifth Amendment has emphasized anew that one of the basic functions of the privilege is to protect innocent men.” (Emphasis by the court.)
In Slochower v. Board of Higher Education of the City of New York (1956), 350 US 551 (76 S Ct 637; 100 L Ed 692) the Supreme Court also commented on the Fifth Amendment privilege when the court said at pp 557, 558:
“The privilege serves to protect the innocent who otherwise might be ensnared by ambiguous circumstances.”
See, also, Fowle v. United States (CA 9, 1969), 410 F2d 48, and People v. Fry (1969), 17 Mich App 229, 232.
In the case before us there can be no question that by allowing cross-examination which shows that defendant exercised his privilege to remain silent he was required to pay a penalty for same. Juries composed of ordinary laymen not trained in the law tend to associate the exercise of the Fifth Amendment privilege with guilt rather than possible innocence and exposure to ambiguous compromising situations. While we cannot affirmatively say that every jury would so react, we cannot speculate that it would not.
While our own Supreme Court has not addressed its attention to this issue since Malloy v. Hogan, supra, we have no alternative but to find that under the rule of that case which we are obliged to follow, the questioning objected to was improperly allowed and that People v. McCrea, supra, no longer is controlling on this issue.
Reversed and remanded for a new trial.
Levin, J. Concurred.
See, also, People v. Lloyd (1967), 5 Mich App 717, in which People v. McCrea (1942), 303 Mich 213, is quoted. However, in that case our Court found that no confession or admission was introduced in evidence in the presence of the jury. Lloyd did not involve the issue presented in this ease. | [
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Reconsideration denied April 26, 1983.
December 6,1982
Proposed Amendment to GCR 1963, 972. On order of the Court, this is to advise that the Court is considering whether to amend GCR 1963, 972. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
(The present language is to be repealed and replaced by the following language except as otherwise indicated below:)
Rule 972. Eligibility for Reinstatement.
.1 (Unchanged.)
.2 Revocation or Suspension for More Than 120 Days. An attorney whose license to practice law has been revoked or suspended for more than 120 days is not eligible for reinstatement until he has petitioned for reinstatement under GCR 1963, 973 and has established by clear and convincing evidence that:
(1)-(7) (Unchanged.)
(8) he is in compliance with the requirements of subrule 972.3, if applicable; and
(9) (Unchanged.)
.3 Reinstatement After Three Years. An attorney who, as a result of disciplinary proceedings, resigns, is disbarred, or is suspended for any period of time, and who does not practice law for 3 years or more, whether as the result of the period of discipline or voluntarily, must be recertified by the Board of Law Examiners before the attorney may be reinstated to the practice of law.
Staff Comment: The proposed amendment of subrule 972.2(8) is a complementary change to reflect the requirements of subrule 972.3. Subrule 972.3 requires an attorney who, as the result of discipline, has not practiced law for 3 years to be recertified by the Board of Law Examiners before being reinstated to the practice of law.
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court. | [
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J. H. Gillis, J.
Defendant was convicted by a Detroit recorder’s court jury of assault with intent to rob and steal being armed. The appeal to this Court is one of right.
The facts of the case are as follows:
The complainant, Marguerite Jenkins, was the owner of a party store. Maurice Garrison, a retired police officer, acted as a “security guard” for the store. On August 26, 1967, at approximately 10 a.m., defendant entered complainant’s store and walked to the back to the canned goods counter. Mr. Garrison was at that time returning from the restroom in the rear of the building. Defendant grabbed him around the neck and wrestled him to the floor. He grabbed a gun which Mr. Garrison had placed under a pile of papers, and shot Garrison. Defendant then grabbed Garrison’s chánge purse, which was lying on the floor, turned, gun in hand, and approached the complainant who was standing behind a counter. Complainant shouted, “Don’t shoot! Don’t shoot!” and grabbed a gun from behind the counter. She shot at defendant and missed.
Defendant fired at her, but the bullet went into the ceiling. Complainant again fired erratically. Defendant. then fled the store, firing two more shots as he was running across the street. Defendant was arrested about two blocks away from the scene of the crime by the Detroit police. The change purse was also found.
Defendant was originally charged with armed robbery of the pistol, certain money, and keys. At trial, the information was amended charging only armed robbery of the pistol from the complainant.
Defendant raises six issues on appeal which will be considered individually below.
I
Did the Evidence Support a Finding of Guilty Beyond a Reasonable Doubt¶
Defendant claims that sufficient proof that he possessed the specific intent to rob complainant was not adduced at trial. Clearly, testimony must be elicited to establish specific intent where that intent is the' gist of the offense. A review of the record in this -case establishes that there was an assault upon the complainant. Secondly, proof was adduced that the act of asportation of the gun was completed by defendant. In the case of People v. Anderson (1966), 64 Cal 2d 633 (414 P2d 366, 51 Cal Eptr 238), the defendant entered a pawn shop and was voluntarily shown a rifle. He stated he wished to purchase it and also needed some shells. After these shells were delivered by the proprietor, defendant loaded the gun, stepped back, and shot a salesman. Defendant was convicted, inter alia, of robbery in the first degree (armed robbery) of the weapon and ammunition. On appeal the defendant argued that the evidence failed to support the robbery conviction. The court rejected the argument. See also People v. Brown (1966), 76 Ill App 2d 362 (222 NE2d 227), and People v. Phillips (1962), 201 Cal App 2d 383 (19 Cal Rptr 839, 841). There was sufficient evidence in the instant case to support a conviction for robbery armed also. Since our Supreme Court has stated that proof of the specific intent necessary to support a conviction of assault with intent to rob being armed can be found in the completed act of robbery armed, we find no merit in defendant’s first claim of error. People v. Blanchard (1904), 136 Mich 146. See also People v. Norman (1968), 14 Mich App 673.
II
Did the Trial Court Err in Allowing the Plaintiff to Amend the Information at Trial?
Defendant contends that the amended information improperly accused him of being armed with and stealing while armed, the very same pistol. We have answered this argument in section I.
Defendant also argues that the amended information was defective in that the pistol in question was not taken from the physical possession or person of the complainant. However, the testimony at trial established that the pistol was owned by complainant and was stolen in her presence. The armed robbery statute makes it a felony to “rob, steal, and take from bis person, or in bis presence, any money or other property”. As indicated in section I, proof of the elements of armed robbery will suffice to support a conviction for the lesser included offense of assault with intent to rob being armed. The defendant’s second claim of error is without merit.
III
Did the Examining Magistrate Err in Binding Defendant Over for Trial?
Defendant admits that the testimony at the preliminary examination was essentially the same as the testimony at trial. Nonetheless, he argues that this testimony was insufficient to support the magistrate’s finding of probable cause that a felony had been committed. In view of onr disposition in section I, discussion of this issue becomes unnecessary.
IV
Was the Jury’s Verdict of Assault with Intent to Rob Being Armed an Improper Compromise Verdict?
In framing this issue, defendant admits a consummated robbery. He then argues that a conviction for a lesser included offense was improper where the evidence establishes a consummated felony. This argument has been answered in People v. Baxter (1928), 245 Mich 229, and we find it unnecessary to repeat what was said there.
V
Were the Loiver Court’s Instructions to the Jury Erroneous?
Defendant questions the jury instructions for the first time on appeal. In the absence of substantial error resulting in a miscarriage of justice, failure to object below waives the issue for appeal. People v. Allar (1969), 19 Mich App 675; People v. Mallory (1962), 2 Mich App 359; GCR 1963, 516.2. Reading tbe instructions as a whole, we find no error.
Affirmed.
All concurred.
MCLA § 750.89 (Stat Ann 1962 Rev § 28.284).
1 Gillespie, Michigan Criminal Law $• Procedure (2d ed), §20, p 38. Assault with..intent to rob being armed is a specific intent crime. People v. McKeighan (1919), 205 Mich 367.
See MOLA § 767.76 (Stat Ann 1954 Rev §28.1016).
MCLA § 750.529 (Stat Ann 1969 Cum Supp § 28.797).
MCLA § 766.13 (Stat Aim 1954 Bev § 28.931).
See also People v. Norman (1968), 14 Mich App 673. | [
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Appeal dismissed on March 15, 1983, upon stipulation by the parties, with prejudice and without costs.
August 20, 1982
Proposed Amendment of GCR 1963, 516. On order of the Court, this is to advise that the Court is considering whether to amend GCR 1963, 516. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
(The rule is to be amended by adding subrule .8 set out below:)
Rule 516. Instructions to Jury.
.1 — .7 (Unchanged.)
.8 Determination of Relative Fault of Joint Tortfeasors.
(a) This subrule applies to cases in which the jury has returned a verdict in favor of the plaintiff against two or more defendants and in which there may be rights of contribution under MCL 600.2925a-600.2925d; MSA 27A.2925(1)-27A.2925(4).
(b) If a defendant has given notice before the start of trial of the intention to claim contribution, the court may submit the issue of the relative fault of the defendants who have been found liable to the same jury. No further evidence may be taken, but counsel for the defendants shall be permitted to argue the issue to the jury.
(c) The issue of the relative fault of the defendants may not be submitted to the jury unless at least one defendant so requests.
(d) If a defendant objects to the submission of the issue of relative fault to the jury, the court shall determine whether it is appropriate to do so. However, if a party has pleaded a claim for contribution and there is a demand for a jury trial of that claim, the issue of relative fault must be submitted to the jury. This subrule does not limit the court’s authority to order a separate trial under GCR 1963, 505.2.
(e) If the defendants who have been found liable stipulate not to submit the relative fault issue to the jury, a party may request that relative fault be determined by the judge who conducted the trial. Such a request must be made by a motion filed no later than 20 days after the entry of judgment for the plaintiff. For good cause the court may permit discovery and the presentation of additional evidence on the contribution issue. Otherwise, the ruling shall be made on the evidence produced at the trial.
(f) The findings regarding the relative fault of the defendants are binding only on the defendants who have been found liable to the plaintiff.
(g) A defendant who has paid more than his or her share as determined under this subrule may enforce the right of contribution by motion or separate action, as provided in MCL 600.2925c; MSA 27A.2925(3).
(h) Except as provided in subsection (f), the submission of (or failure to submit) the issue of relative fault as provided in this subrule does not affect the right to bring a separate action for contribution under MCL 600.2925c; MSA 27A.2925(3).
(i) Proceedings pursuant to this subrule do not affect the right of the plaintiff to a joint and several judgment.
Publication of this proposal does not mean that the . Court will issue an order on the subject, nor does it imply probable adoption in its present form. Timely comments will be substantively considered and your assistance is appreciated by the Court.
A copy of this order will be given to the secretary of the State Bar and to the State Court Administrator so that they can make the notifications specified in GCR 1963, 933. Comments on this proposal may be sent to the Supreme Court clerk within 60 days after it is published in the Michigan Bar Journal.
Staff Comment: The proposed amendment was submitted by the Standard Jury Instruction Committee.
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court.
Proposed Amendment of GCR 1963, 316. On order of the Court, this is to advise that the Court is considering whether to amend GCR 1963, 316. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
(The rule is to be amended by the addition of subrule .9, as set out below:)
Rule 316. Mediation.
.1 — .8 (Unchanged.)
.9 Expedited Mediation.
(a) Where all parties stipulate, any civil case may be submitted to expedited mediation to determine the relief.
(b) The matter may also be submitted on written motion by a party, or on the judge’s own motion as long as the stipulation provided for in subrule 316.9(a) has been filed, or if liability has been resolved pursuant to a grant of judgment based on GCR 1963, 117.2(2).
(c) Advancement of a case on the mediation calendar shall have no effect on the progress of the case toward trial.
(d) The effect of mediation remains the same as set forth in subrule 316.7.
Publication of this proposal does not mean that the Court will issue an order on the subject, nor does it imply probable adoption in its present form. Timely comments will be substantively considered and your assistance is appreciated by the Court.
A copy of this order will be given to the secretary of the State Bar and to the State Court Administrator so that they can make the notifications specified in GCR 1963, 933. Comments on this proposal may be sent to the Supreme Court clerk within 60 days after it is published in the Michigan Bar Journal.
Staff Comment: The State Bar Representative Assembly submitted the proposed amendment.
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court.
Proposed Amendment of GCR 1963, 921. On order of the Court, this is to advise that the Court is considering whether to amend GCR 1963, 921. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
(The present language is to be repealed and replaced by the following language:)
Rule 921. Legal Aid Clinics, Prosecuting Attorneys’ and City Attorneys’ Student and Graduate Programs, Law School Clinical Programs.
.1 Legal Aid Clinics. Effective legal service for each person in Michigan, regardless of that person’s ability to pay, is important to the directly affected person, to our court system, and to our whole citizenry. Law students, under supervision by a member of the State Bar of Michigan, may staff legal aid clinics organized under a city or county bar association or an accredited law school, or which are funded pursuant to the Legal Services Corporation Act.
.2 Other Clinical Legal Training Programs. Law students and graduates may participate in legal training programs organized in the offices of county prosecuting attorneys or city attorneys or in law school clinical practice programs, in which a law student obtains both academic and practice advocacy training, utilizing law school faculty or adjunct faculty members for practice supervision.
.3 Procedure. A member of the legal aid clinic, in representation of indigent persons, shall be authorized to advise such persons and to negotiate and appear in all courts of this state except the Court of Appeals and Supreme Court in criminal and civil matters on their behalf. These activities shall be conducted under the supervision of a member of the bar. Supervision by a member of the bar shall include the duty to examine and sign all pleadings filed on behalf of an indigent person. Supervision shall not require that any such member of the bar be present in the room while a student or law graduate is advising an indigent person or negotiating on the indigent person’s behalf nor that the member of the bar be present in the courtroom during a student’s or graduate’s appearance except in criminal or juvenile cases carrying a penalty in excess of six months. In no case shall any such student or graduate appear in any court of this state without first having received the approval of the judge of that court for his appearance. Where such permission has been granted, the judge of any court may suspend the trial proceedings at any stage where the judge in his sole discretion determines that such student’s or graduate’s representation is professionally inadequate and substantial justice so requires. Law students or graduates serving in a prosecutor’s or city attorney’s program or in a law school clinical practice program may be authorized to perform comparable functions and duties as assigned by the prosecuting attorney or city attorney or clinical practice program director, subject to all the conditions and restrictions in this rule and the further restriction that they may not be appointed as assistant prosecutors or assistant city attorneys.
.4 Eligible Students. Any student in an accredited law school who has received a passing grade in law school courses and has completed the freshman year shall be eligible to participate in the programs described herein if that student meets the academic and moral standards established by the dean of that school.
Publication of this proposal does not mean that the Court will issue an order on the subject, nor does it imply probable adoption in its present form. Timely comments will be substantively considered and your assistance is appreciated by the Court.
A copy of this order will be given to the secretary of the State Bar and to the State Court Administrator so that they can make the notifications specified in GCR 1963, 933. Comments on this proposal may he sent to the Supreme Court clerk within 60 days after it is published in the Michigan Bar Journal.
Staff Comment: The proposed amendment extends the authorization for the limited practice of law by law students to qualified students involved in law school clinical practice programs under the same conditions now applying to legal aid clinics and prosecuting and city attorneys’ legal training programs.
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court.
Proposed New GCR 1963, 918. On order of the Court, this is to advise that the Court is considering whether to adopt GCR 1963, 918. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
Rule 918. Use op Communication Equipment.
.1 Definition. “Communication equipment” means a conference telephone or other electronic device that permits all those appearing or participating to hear and speak to each other.
.2 Use. A district, probate, or circuit judge may, on his or her own motion or on the written request of a party, direct that communication equipment be used for a motion hearing, pretrial conference, or status conference. A judge must give notice to the parties before directing on his or her own motion that communication equipment be used. A party’s written request must be made at least 7 days before the day on which the communication equipment is sought to be used. A judge may, with the consent of all parties, direct that the testimony of a witness be taken through communication equipment. A verbatim record of the proceeding must still be made.
.3 Burden of Expense. The cost for the use of the communication equipment is the responsibility of the requesting party, unless the judge otherwise directs.
OR
The cost for the use of the communication equipment is to be shared equally, unless the judge otherwise directs.
Publication of this proposal does not mean that the Court will issue an order on the subject, nor does it imply probable adoption in its present form. Timely comments will be substantively considered and your assistance is appreciated by the Court.
A copy of this order will be given to the secretary of the State Bar and to the State Court Administrator so that they can make the notifications specified in GCR 1963, 933. Comments on this proposal may be sent to the Supreme Court clerk within 60 days after it is published in the Michigan Bar Journal.
Staff Comment: The State Bar Representative Assembly has recommended that this Court adopt a rule governing the use of communication equipment for motion hearings and pretrial or status conferences. Alternative versions of proposed subrule 918.3 are offered for comment. The Representative Assembly recommended a provision in which costs would be the responsibility of the requesting party. The State of Washington has provided for costs for these conferences to be shared equally. RAP 17.5(e).
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court.
Proposed Amendment of DCR 506. On order of the Court, this is to advise that the Court is considering whether to amend District Court Rule 506. Before determining whether the proposal should be adopted, changed before adoption, or rejected, this notice is given to afford any interested person the opportunity to comment on the form or the merits of the proposal, the text of which is as follows:
(The present language is to be repealed and replaced by the following language except as otherwise indicated below:)
DC Rule 506. Compelling the Testimony of Parties and Witnesses.
.1 — .4 (Unchanged.)
.5 Service of Subpoena.
(a) Civil Case. A subpoena in a civil case is to be served in a manner provided by DCR 105. The fees for one day’s attendance and for mileage, provided by law, are to be given to the person on whom the subpoena is served at the time of service. Service on a party of notice that his or her testimony has been ordered by the court may be served in a manner provided by DCR 107.
(b) Criminal Cases and Civil Infractions. A subpoena in a criminal case or civil infraction case may be served either in a manner provided by DCR 105 or by mailing to a witness a copy of the subpoena and a postage-paid card acknowledging service and addressed to the party requesting service. The fees for attendance and mileage, provided by law, are to be given to the witness after the witness appears at the court. If the card is not received by return mail, the subpoena must be served in a manner provided by DCR 105.
.6 (Unchanged.)
Publication of this proposal does not mean that the Court will issue an order on the subject, nor does it imply probable adoption in its present form. Timely comments will be substantively considered and your assistance is appreciated by the Court.
A copy of this order will be given to the secretary of the State Bar and to the State Court Administrator so that they can make the notifications specified in GCR 1963, 933. Comments on this proposal may be sent to the Supreme Court clerk within 60 days after it is published in the Michigan Bar Journal.
Staff Comment: The District Judges Association Rules and Forms Committee has recommended to the Court that subpoenas in criminal cases and in civil infractions be allowed to be served by mail. The proposal is based on the Kalamazoo County experience with this form of subpoena service.
The staff comment is published only for the benefit of the bench and bar and is not an authoritative construction by the Court. | [
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Lesinski, C. J.
Lutie O’Loughlin, widow of Terrence O’Loughlin, as administratrix of his estate, brought suit under the Wrongful Death Act to recover damages from defendant Detroit and Mackinac Railway Company. The trial court sitting without a jury awarded plaintiff damages of $100,-000. On its own motion the court reduced the recovery to $88,000. From this judgment defendant appeals and plaintiff cross-appeals.
At approximately 1:30 a.m. on October 3, 1963, plaintiff’s decedent was fatally injured when the car which he was driving collided with defendant’s freight train at a crossing on US 23 near Ossineke in Alpena County. O’Loughlin died without regaining consciousness.
Defendant raises two issues on appeal. First, whether the trial court was clearly in error in failing to find O’Loughlin guilty of contributory negligence. Second, whether the trial court committed reversible error in refusing to allow defendant’s witness, a chemist and toxicologist, to testify as an expert on the significance of 0.15% by weight of alcohol in O’Loughlin’s blood. We address ourselves to these questions in reverse order.
At trial defendant offered Alvah Gatrell, a toxicologist and chemist employed by the crime detection laboratory of the Michigan Department of Health, as an expert witness. After establishing that Mr. Gatrell analyzed the blood sample removed from decedent immediately after the accident and that the sample contained 0.15% alcohol, defendant asked the following question: “And Mr. Gatrell, what is the significance of that finding?” The answer to this question was objected to on the ground that the witness was not qualified to testify as to the effects of the stated amount of alcohol in a person’s bloodstream.
That the determination of the qualifications of an expert is a matter within the discretion of the trial judge, to be interfered with only to correct an abuse, is settled law in this State. People v. Hawthorne (1940), 293 Mich 15.
However, in this case we find that the trial judge abused his discretion in limiting the scope of this expert’s testimony. Mr. Gatrell testified that he received a degree in chemistry from Michigan State University (then College) in 1928. Subsequently he worked approximately 23 years in the chemical pharmaceutical field. He held various supervisory positions during that period. For the 13 years before the trial, he was employed by the Department of Health, spending 12 years in the crime laboratory. At the laboratory he worked with 12 physicians analyzing blood samples and observing various test situations involving alcohol experiments. He also testified that he assisted two students of the Michigan State University Police Administration School in a 13-week experiment studying the effect of alcohol upon drivers. It appears Mr. G-atrell aided in the conduct and analysis of the various experiments. In addition, it appears Mr. Gatrell assisted in various other similar experiments during his tenure at the laboratory. Similar testimony has been given by chemists in other jurisdictions, even in trials before juries, which is not this case. DeSalvatore v. State (1960), 52 Del 550 (163 A2d 244); Commonwealth v. Capalbo (1941), 308 Mass 376 (32 NE2d 225); People v. Markham (1957), 153 Cal App 2d 260 (314 P2d 217); State v. Libby (1957), 153 Me 1 (133 A2d 877). See generally, annotation, 77 ALE 2d 971.
The trial court should have had the benefit of Mr. Gatrell’s expert testimony before attempting to arrive at a conclusion. Failure to admit the testimony was clearly erroneous.
The question, therefore, turns to whether the error was prejudicial. We conclude, for two reasons, that it was not.
First, the trial court took notice of MCLA § 257.625a (Stat Ann 1968 Eev § 9.2325[1]), and began its factual determination of the case with the presumption that since O’Loughlin’s blood test showed 0.15% alcohol by weight, he was under the influence. The testimony of defendant’s expert could add little to this. Lacking firsthand knowledge of how alcohol affected O’Loughlin’s ability (as a particular individual) to drive, all the expert could have provided was certain statistical averages and generalities as to how people are effected by given amounts of alcohol. This testimony could have been met, just as the presumption was met, by competent evidence.
Second, intoxication is a defense in the instant case only if it was causally related to the accident. In this regard the trial court found: “Under all the circumstances here existing the train was not visible to plaintiff’s decedent nor would it have been visible to an ordinarily prudent driver.” (Emphasis supplied.)
Effectively the trial court found that defendant’s negligence had made the train so difficult to see on the night of the accident that even a person not under the influence (i.ethe ordinarily prudent driver) would not have seen it in time to avoid a collision. If this finding is not clearly erroneous, then O’Loughlin’s state of intoxication was not causally connected with the accident.
¥e must, therefore, consider defendant’s argument that the trial court’s failure to find O’Loughlin contributorily negligent was clearly erroneous.
Defendant points to several factors tending to indicate contributory negligence. O’Loughlin was driving at a speed of 50 to 60 miles an hour with his low beam lights although the night was dark and misty. He had 0.15% by weight of alcohol in his blood. He made no visible effort to avoid the collision until he was 135 feet from the crossing. A railroad crossing sign was located 500 feet in advance of the crossing.
While these points are true the record does reveal sufficient evidence to absolve O’Loughlin of an allegation of contributory negligence. The night of the accident was overcast and misty. It had been raining off and on earlier in the evening. Although an electric flasher signal, equipped with lights and bells, existed at the crossing, both eyewitnesses testified that it was not operating when the train in question was crossing US 23.
Moreover, the witnesses, who viewed the entire accident from a crossroad 135 feet north of the railroad crossing, described the train as “dark” and of a “dull color.” They testified: “You couldn’t see it too well,” and “I could barely see the train. It was kind of like a shadow going across a track or a street.”
Evidence was introduced, however, which tended to prove that the total stopping distance at 45 miles per hour is 186 feet and at 55 miles per hour 291 feet under ideal conditions. The record indicates that the nighttime speed limit on US 23 in the area of the accident was 55 miles per hour, and testimony supports the trial court’s finding of fact that O’Loughlin was driving between 50 and 55 miles per hour as he approached the crossing. In light of the testimony that the witnesses could “barely see the train” 135 feet from the crossing and the need of twice that distance to come to a safe stop, the significance of the absent warning lights becomes apparent.
The existence of a railroad crossing sign located 500 feet north of the crossing was not sufficient to put O’Loughlin on notice. Decedent was a resident of the area and had traveled this section of US 23 on many previous occasions. He was thus familiar with the electric flashing signal and had the right to rely on it. As noted in Motyka v. Detroit, G. H. & M. R. Go. (1932), 256 Mich 417, 418: “It was then a protected crossing. It is settled law, and it is common sense, that one may place some reliance on the protection afforded at the crossing. * * * If one may place no reliance on gates and flagmen, why have them.” The existence of the standard cross-buck sign 500 feet from the crossing did not reduce the reliance O’Loughlin could place in the electric flasher. Indeed, in light of O’Loughlin’s familiarity with the area, the crossbuck sign probably served as a warning to be on guard for the electric flasher.
Also, the fact that “he made no visible effort to avoid collision until he was 135 feet from the crossing” does not necessarily imply contributory negligence. O’Loughlin’s car left skid marks starting 102 feet from the crossing. The evidence in the record concerning stopping distances and reaction time indicates that if O’Loughlin was going 50-55 miles per hour, he would have traveled 55-60 feet after he saw the train before he would have applied his brakes, Therefore, he probably saw the train approximately 160 feet from the crossing. Considering the eyewitnesses could “barely see” it at a distance of 135 feet, O’Loughlin’s reactions appear to have been reasonable.
We conclude, therefore, that sufficient evidence exists to support the trial judge’s findings that considering the weather conditions prevailing on the night of the accident, the dark color of the train and the failure of the warning signal to operate, that neither O’Loughlin nor a reasonably prudent driver could have seen the train or had warning of it in time to avoid a collision. The record also supports the finding that the railroad knew or should have known that the electric signal was not properly functioning during a significant period preceding the accident. Our review of the record convinces us that the trial court was not clearly in error in its basic findings of fact. Hughson v. O’Reilly (1967), 7 Mich App 324; King v. Partridge (1968), 9 Mich App 540, OCR 1963, 517.1 and 810(2).
Defendant asserts that this case is governed by our decision in Music v. New York Central R. Co. (1966), 2 Mich App 467. There defendant had been found by the trial court to have been driving recklessly as he approached a crossing, which he did not claim to be unusually dangerous, on a clear, dry night. In the instant case the eyewitnesses testified that O’Loughlin’s speed did not seem excessive. Moreover, here the primary cause of the accident was the invisibility of the train at a distance where a safe stop was physically possible.
On cross-appeal plaintiff attacks the reduction of the verdict from $100,000 to $88,000 by the trial court. The action was taken on the trial court’s own motion. In its order reducing judgment, the trial court stated:
“Defendant having moved for entry of judgment of no cause of action and in the alternative a new trial, this court on its own motion amends the judgment heretofore entered in the amount of $100,000 which was based on the court’s. understanding that the expert actuary witness had not included interest in his computation of loss of earning and that, therefore, income taxes which might have been payable on such earnings would be thus offset, and, thereafter the court on reviewing the actuary’s testimony, believing that he did add interest, therefore reduces the judgment by $12,000 or the estimated income taxes payable, and over the objection of the plaintiff in open court.” (Emphasis supplied.)
Defendant initially argues that the trial court merely corrected a clerical error, citing GrCR 1963, 528.1. Our review of the record and the trial court’s order reducing judgment, however, convinces us that the trial court made a substantive change in the judgment by considering the element of taxes, which it had not previously taken into consideration.
The issue raised by the parties is whether the finder of fact may take into account income tax consequences in figuring the size of the compensatory award to be made. A review of authority reveals that the courts and commentators are badly split on the issue. The issue has not been decided in Michigan. Based on the record presented, however, it is not necessary to reach the issue and we, therefore, reserve judgment on the question.
“The court of its own motion is going to modify this judgment and reduce the amount of the judgment by the amount that the court had determined as being income taxes attributable to the moneys which would have been earned by the deceased and this amount is in the sum of $12,000.”
No evidence was either admitted or offered to show what O’Loughlin’s tax status would have been had he lived during the period between the accident and trial, or for the period following trial. Consideration of the effect of taxes, if it is to be allowed, may only be allowed when based upon facts and expert opinion properly brought into evidence. Just as the fact-finder must set its award according to an educated guess based on the facts presented at trial, so too, if the judgment is to be reduced it may only be done according to evidence presented.
As no evidence exists sufficient to support the trial court’s reduction of the verdict, the reduction constitutes error. On remand the trial court will enter its order reinstating the original judgment.
Affirmed as modified and remanded for actions not inconsistent with this opinion. Costs to plaintiff.
All concurred.
MOLA § 600.2922 (Stat Ann 1969 Cum Supp § 27A.2922).
Hereinafter also referred to as O’Loughlin.
The witness’ answer, made prior to objection, was: “He would definitely be under the influence of alcohol.”
See generally, 2 MLP, Appeal, § 461, pp 408, 409.
On the issue of whether MCLA § 257.625a (Stat Ann 1968 Eev § 9.2325 [1]), applies to civil suits, we specifically reserve judgment for another case. We simply note here that as a factual matter the trial court did give defendant the benefit of the presumption.
Its soundness will be discussed below.
Mr. Bernard Dalton, one of the two eyewitnesses, testified:
“Q. O.K. Then what happened?
“A. I started to pull out right away and then I thought there wasn’t any sense in it, because the train was there, and X would have to wait anyway, so I would just wait for the car to come and I looked up and looked — and it looked to me like he had plenty of time to stop and I was sitting there and about the time he got in front of us, I realized that he hadn’t even seen the train and wasn’t able to see anything at all and it just hit me all of a sudden that he didn’t see it. There rvasn’t any way to see it. I had, before, earlier — when we came to the first crossing down South Ossineke Boad and the railroad, there was no flashing or anything and being almost hit by the train I made a remark to myself and wife both that they should have a flasher there because a guy could get killed and I turned right and eame to the intersection of Piper Boad and US 23 and I turned to her and I said, ‘Well, they don’t have one here, either.’
“Q. Now, at that time, you heard no bells?
“A. Well, I may have heard a bell on the engine, maybe, but it wasn’t a bell of a signal or anything.
“Q. Did you observe any flashers at that time?
"A. No, there wasn’t anything flashing up there.
“Q. Did you hear any bells or observe any flasher prior to the time that the car—
“A. (interrupting). No, sir.”
Defendant asserts that the crossing was visible for 1,200 feet. While this ns true on a clear day, the testimony of the eyewitnesses adequately supports the conclusion that under the weather conditions at the time of the accident, it was barely possible to see the crossing from the crossroad only 135 feet away.
Evidence was produced to the effect that the signal would sometimes come on and stay on for hours at a time when no train was approaching from either direction and that the railroad had to be called to send an employee to turn it off. There was also evidence that the signal would sometimes turn off prematurely and testimony indicating that during the year preceding the accident, members of the local railroad brotherhood had registered complaints that the flasher was not operating properly so as to allow traffic on US 23 to stop and avoid collisions with the trains.
The record also contains the following statement made by the trial court:
See generally, 63 ALR2d 1393, Annotation: “Propriety of taking income tax into consideration in fixing damages in personal injury or death action.”
2 Harper and James, The Law of Torts, § 25.12 pp 1326-1327; Spangenberg: Wrongful Death and Survivorship. | [
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Levin, J.
Plaintiff, Nada Orlich, was injured when an automobile she was driving was struck in the rear by an automobile being driven by the defendant. She and her husband commenced this action and obtained a jury verdict. The question on appeal concerns the extent of the plaintiffs’ waiver of the statutory physician-patient privilege when they called as witnesses the physicians who treated Nada Orlich.
Nada Orlich was treated by one doctor from November 6, 1964, two days after the accident, through June 11, 1965. She was treated by another doctor from November 2, 1965 through April 1, 1966. Both of these doctors testified at the trial in November, 1967.
Mrs. Orlich testified that while she consulted no other doctor for conditions related to the accident, early in 1967 she saw Dr. William G-. Quigley, and had upper and lower gastrointestinal tests “and female tests and so forth, just a general physical.” She said that Dr. Quigley’s examination had nothing to do with “the complaint in this accident.”
The defendant’s attorney then subpoenaed Dr. Quigley. When the doctor arrived in court he permitted defendant’s attorney to see his records regarding Mrs. Orlich. Before Dr. Quigley could be called as a witness, the plaintiffs’ attorney objected to his testifying. The objection was considered on a segregated record.
Defendant’s attorney said that, “It is my understanding the doctor will indicate he performed a general examination on the plaintiff in February of this year and at that time when she was asked what her complaints were she did not indicate she had any back or neck problems. That’s my purpose in wanting to put the doctor on.”
Dr. Quigley then stated that Mrs. Orlich did not complain about cervical or back problems, and that she did not consult him about injuries to her neck and back.
The trial judge refused to allow the defendant to ask Dr. Quigley questions about his physical examination of Mrs. Orlich. The defendant claims the judge erred; we disagree and affirm.
The physician-patient privilege did not exist at common law; it is purely statutory. Under the Michigan statute if a plaintiff produces a physician as a witness who has treated him for an injury, he is. deemed to have waived the privilege as to all other physicians “who may have treated him for such injur [y] ,”
The defendant was not bound by Mrs. Orlieh’s testimony that Dr. Quigley’s physical examination did not concern the injuries which she claims she suffered in. the accident. However, on the segregated record, Dr. Quigley substantially corroborated her testimony concerning the extent of his examination and treatment. He said that she did not complain or consult him about injuries to her neck and back.
It was not the defendant’s claim on the segregated record that during Dr. Quigley’s physical examination of Mrs. Orlich he acquired knowledge of whether' she had suffered a neck or back injury or that he treated her for such an injury. The defendant’s attorney stated, rather, that he sought to question Dr. Quigley before the jury in an effort to establish that the doctor asked Mrs. Orlich what her complaints were and that she did not complain about back and neck problems: “That’s my purpose in wanting to put the doctor on.”
One can, indeed, interpret a failure by Mrs. Orlich to complain of neck and back problems to mean that she did not have a neck or back injury; an equally plausible interpretation is that she did not wish to consult Dr. Quigley about any neck or back injury. Whichever interpretation one chooses to adopt, such a question by a doctor and response by a patient is not “treatment” by the doctor “for such injury” within the meaning of the statute.
We also note that it is not claimed that Mrs. Orlich said that she had no other complaints, rather that she simply did not state any other complaints. She owed no duty to either Dr. Quigley or the defendant to relate to the doctor all her medical complaints. Her taciturnity was not the equivalent of “treatment” by him.
Nor did the trial judge err in refusing to allow Dr. Quigley to be further examined during the making of the segregated record. Under GrCR 1963, 604, where an objection is sustained, the objecting attorney may describe what he expects to prove by the answer of the witness, “or by leave of court, may examine the witness in relation thereto.” We find no abuse of the trial judge’s discretion in refusing to allow an examination of Dr. Quigley under the circumstance that the defendant’s attorney had already stated what he expected to prove through the doctor’s testimony. The function of permitting an offer of proof was thereby satisfied, i.e., that there be an adequate basis for the trial judge to pass on the objection and for the appellate courts to evaluate a claim that he ruled incorrectly. The record made in this case was sufficient for both purposes; there was no error.
Affirmed. Costs to plaintiffs.
All concurred.
The verdict was $4,500 in favor of Nada Orlich and $1,500 for Stephen Orlich,
See La Count v. Von Platen-Fox Co. (1928), 243 Mich 250, 253, 58 Am Jur, Witnesses, § 401, p 232.
MCLA § 600.2157 (Stat Ann 1962 Rev § 27A.2157); see Mulvena v. Alexander (1936), 278 Mich 265, 268; De Groff v. Clark (1960), 358 Mich 274, 278. Calling a treating physician did not waive the privilege as to other treating physicians under an earlier statute; see Slater v. Sorge (1911), 166 Mich 173, 178, 179, construing 3 Comp Law 1897, § 10181. (The statute took its present form when the judicature act of 1915 was adopted, see PA 195, No 314, Ch XVII, § 62.) It. is, therefore, apparent that the extent of the waiver of the privilege which results from calling a. treating physician depends on the language of the statute.
The defendant did not complain on the segregated record of the failure of fthe trial judge to , swear Dr. Quigley before the informal in-chambers examination of Dr. Quigley and colloquy between the judge and counsel took place.
Cf. La Count v. Von Flaten-Fox Co., supra; Magda v. Johns (1964), 374 Mich 14, 20.
See Conlon v. Dean (1969), 14 Mich App 415, 424. | [
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Levin, J.
This is an appeal from a judgment in a partnership accounting. The question presented is whether, upon dissolution of the partnership, the plaintiff was entitled to the return of the $Í0,000 which he had contributed to its capital before any division of profits. The trial judge ruled against the plaintiff; we reverse.
The plaintiff and the defendant were equal partners in a two-man partnership. The partnership purchased the common capital stock of Van Dyke Dodge, Inc., an automobile dealership. The plaintiff contributed $10,000 to the capital of the partnership which was used to pay part of the purchase price of the stock; the trial judge found that the balance of the purchase price was paid out of profits of the corporation. Neither partner contributed any other capital. The partnership had no business other than its investment in the capital stock of Van Dyke Dodge, Inc.
In connection with its dissolution, the partnership sold its only asset, the stock in Van Dyke Dodge, Inc., for $21,474. There were no liabilities; the trial judge found that the profits of the partnership were $21,474. He also found that the interest of each partner in the profits was one-half of that amount, namely, $10,737.
The defendant claimed that shortly after the sale of the stock $10,000 was paid to the plaintiff and the trial judge so found, which finding the plaintiff does not challenge on this appeal. The judge ruled that the $10,000 paid the plaintiff would be treated as partial payment of plaintiff’s $10,737 share of the profits and entered a judgment in plaintiff’s favor for $737 plus interest and costs.
Plaintiff contends that the trial judge erred in not first returning to him the $10,000 which he contributed to capital before dividing profits, and that after returning the $10,000 the profits of the partnership would be only $11,474, and that one-half of that amount, namely $5,737, should have been awarded to the plaintiff, together with interest and costs. We agree with the plaintiff’s analysis.
The partnership agreement was oral. It is not claimed that there was any agreement regarding the right of a partner who contributed capital to the return of his capital contribution. Accordingly, under §§18 and 40 of the uniform partnership act the plaintiff was entitled, upon dissolution of the partnership, to the return of the $10,000 which he had contributed to capital before profits were determined and distributed in settlement of the partners’ accounts.
The defendant was president and general manager of Van Dyke Dodge, Inc., and received a salary of $12,000 a year in 1962, which was increased to $15,-000 a year in 1965. The partnership was dissolved iti 1967. The plaintiff received a salary of $100 a week from the corporation during most of this period. The trial judge was of the opinion that the $5,200 annual salary paid by the corporation to the plaintiff was to be weighed in the partnership accounting. He said, “I might add in passing, I do not think Mr. Vassallo [plaintiff] has too much to complain about. For a $10,000 initial investment, which I think he got back, he received salaries which in my opinion were for absolutely nothing. Absolutely nothing. They were a gift. You received over $20,000 so you do not have much to complain about.” The point is, however, that the amounts paid weekly by the corporation to the plaintiff and the defendant were, as the judge found, paid as salaries, not either as a division of profits or as a return of capital.
Reversed and remanded for the entry of a judgment in plaintiff’s favor in the sum of $5,737 plus interest and costs.
All concurred.
“See. 18. The rights and duties of the partners in relation to the partnership shall be determined, subject to any agreement between them, by the following rules:
“(a) Each partner shall be repaid his contributions, whether by way of capital or advances to the partnership property and share equally in the profits and suiqilus remaining after all liabilities, including those to partners, are satisfied; and must contribute towards the losses, whether of capital or otherwise, sustained by the partnership according to his share in the profits.” MCLA § 449.18 (Stat Ann 1964 Eev § 20.18).
“See. 40. In settling accounts between the partners after dissolution, the following rules shall be observed, subject to any agreement to the contrary: * * *
“(b) The liabilities of the partnership shall rank in order of payment, as follows:
“(I) Those owing to creditors other than partners,
“(II) Those owing to partners other than for capital and profits,
“(III) Those owing to partners in respeet of capital,
“(IV) Those owing to partners in respect of profits;” MOLA § 449.40 (Stat Ann 1964 Eev § 20.40).
We, have found no Michigan decision in point. In the following cases the uniform partnership act was relied on to suqiport the court’s determination that upon dissolution of a partnership, in the absence of a conflicting agreement, each partner is entitled to have restored to him his capital contributions before any division of profits: Glenn v. Weill (1935), 319 Pa 380 (179 A 563) (Citing §18); Sinman v. Mezoff (1951), 327 Mass 285 (98 NE2d 263) (citing § 40) ; Gordon v. Ginsberg (1964), 22 App Div 2d 944 (255 NYS2d 966) (citing §40); Valley Springs Holding Corp v. Carlson (1929), 56 SD 163 (227 N¥ 841) (citing §18); West v. West (1965), 16 Utah 2d 411 (403 P2d 22) (citing § 18) ; En Taik Ha v. Kang (1960), 187 Cal App 2d 84 (9 Cal Rptr 425) (citing § 18) ; Burnett v. Mopwood (1932), 187 Minn 7 (244 NW 254) (citing §§ 18, 40); Bass v. Daetwyler (Mo App, 1957), 305 SW2d 339 (citing §§ 18, 40); Rosenberger v. Kuesel (1928), 292 Pa 184 (140 A 860) (citing §§18, 40).
Other eases so holding but whieh did not rely on either eited section of the uniform partnership aet are: Hunter v. Allen (1944), 174 Or 261 (147 P2d 213), modified on other grounds 174 Or 261 (148 P2d 936) ; Baum v. McBride (1950), 152 Neb 152 (40 NW2d 649); Tiffany v. Short (1943), 22 Cal 2d 531 (139 P2d 939).
See, generally, Crane and Bromberg, Law of Partnership, § 90, p 507; 40 Am Jur, Partnership, § 348, p 373.
There is an obvious inconsistency in saying that the $10,000 whieh the trial judge found plaintiff received following the dissolution of the partnership was paid in return of his $10,000 initial contribution to capital and also treating the same payment as plaintiff’s share of the profits. But that is what the trial judge did when lie held that the proceeds of the sale of the capital stock of Van Dyke Dodge, Inc., $21,474, should be equally divided, $10,737 to each partner, and against plaintiff’s share counting “the $10,000 initial investment, whieh I think he got back.” | [
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Bronson, J.
On March 20, 1967, plaintiff filed a civil action in Wayne County circuit court in assumpsit and trespass on the case. On May 22, the case was transferred to the Macomb County circuit court. Plaintiff alleged that defendant had been employed by plaintiff to survey a parcel of land which plaintiff had owned. As a result of his reliance on that survey, which plaintiff claims to have been inaccurate, plaintiff was sued. Plaintiff claims the losses he suffered were the result of the defendant’s negligence. Both parties agree that the cause of action arose December 19,1961. Defendant made a motion for summary judgment, claiming that since the action brought was either malpractice or negligence, it was barred by the statute of limitations. The trial judge granted defendant’s motion for summary judgment and plaintiff appeals.
In his complaint plaintiff states that as a result of defendant’s failure to live up to the contract between the parties, plaintiff has suffered damages and that there was a complete breach of their agreement by defendant’s failing to perform the work according to the terms of the contract. Plaintiff seeks $10,000 damages. This sum represents plaintiff’s legal fees incurred in his defense of the suit arising out of a sale of the property based on the survey, plus plaintiff’s loss of time from work to defend in that suit, damage.to his reputation at his place of employment, loss of previously good friends, and anxiety and damage to his future career. Plaintiff states that these losses are directly attributable to the negligence of defendant. The sole issue that we consider on appeal is whether the trial court was correct in granting summary judgment to defendant on the basis that either the two-year malpractice or three-year negligence statute of limitations applies to this suit against the surveyor rather than the six-year contract statute of limitations. It is plaintiff’s contention that the language of MCLA § 600.2912 (Stat Ann 1962 § 27 A-.2912) is permissive.
We feel the issue as presented really involves the question which of two statutes applies, MCLA § 600-.5805 (Stat Ann 1962 § 27A.5805):
“No person may bring or maintain any action to recover damages for injuries to persons or property unless, after the claim first accrued to himself or to someone through whom he claims, he commences the action within the periods of time prescribed by this section.
* * *
“(3) The period of limitations is 2 years for actions charging malpractice.
* * *
“(7) The period of limitations is 3 years for all other actions to recover damages for injuries to persons and property.”
or MCLA § 600.5807 (Stat Ann 1962 § 27A.5807):
“No person may bring or maintain any action to recover damages or sums due for breach of contract, or to enforce the specific performance of any con tract unless, after the claim first accrued to himself or to someone through whom he claims, he commences the action within the periods of time prescribed by this section.
* * *
“(8) The period of limitations is 6 years for all other actions to recover damages or sums due for breach of contract.”
The trial court found that plaintiff’s pleadings and oral argument on the motion for summary judgment stated a cause of action arising either from the negligence of defendant or from failure of defendant to exercise the required standard of care when furnishing the survey.
An action to recover damages for injury to person or property must be commenced within three years or it is thereafter barred by the statute of limitations irrespective of how plaintiff proceeds to seek recovery and regardless of whether or not the injury arises out of a contractual relationship of the parties, either express or implied. State Mutual Cyclone Insurance Company v. O & A Electric Cooperative (1968), 381 Mich 318. The three-year statute of limitations applies equally as well to breach of contract actions based on a tortious or negligent act. Baatz v. Smith (1960), 361 Mich 68. In the present case, however, plaintiff does not claim an injury to his property or to his person. What plaintiff alleges is that he was injured in his financial expectations. Since the cases cited are based entirely upon actual damage to property or physical injury to the plaintiff, there remains to be answered the question as to whether the injury plaintiff sustained is to his person as required by MOLA § 600.5805 (Stat Ann 1962 §27A.5805). It appears from the complaint that plaintiff was indeed injured in his financial expectations rather than in his person. In Fries v. Holland Hitch Company (1968), 12 Mich App 178, 183, the Court stated:
“* * * Although the above-quoted statutory-provisions are generally thought of as ‘tort’ and and ‘contract’ provisions respectively, the provisions are not applied through any sense of magical language found in the pleadings. A party cannot invoke the longer statute by the mere expedient of calling a tort an implied contract; but an action for breach will not be limited to 3.. years because the breach arose through defendant’s negligence. * * *” (Emphasis added.)
The Court in Fries went on to say, at p 185:
“We believe that the correct construction of these statutory provisions to be that where the injury is to specific property or persons, the 3-year limitation controls. The 6-year period may be thought of as an exception applicable to such actions wherein the injury is occasioned by breach of some express contractual provision. See for instance Stewart v. Rudner (1957), 349 Mich 459. On the other hand, in contracts of a commercial nature or where the breach injures one in his financial expectations and economic benefit, rather than his person or specific property, then such actions may be brought within 6 years whether founded upon express or implied contract. Abbott v. Michigan State Industries (1942), 303 Mich 575.”
In the present case there was a contract. Plaintiff claims that part at least of the damages involved here arose from a lawsuit brought against him due to the inaccurate survey and also that there was damage to his future career. Both of these claims would seem to come within the language of Fries, supra. Under the language cited from Fries, it is clear that plaintiff was injured “in his financial expectations and economic benefit rather than in his person or specific property.” Therefore, the statute of limitations should have been six years and it was error for summary judgment to have been granted for defendant.
Reversed and remanded.
All concurred.
“(1) A eivil action for malpractice may he maintained against any person professing or holding himself out to be a member of a state licensed profession. The rules of the common law applicable to actions against members of a state licensed profession, for malpractice, are applicable against any person who holds himself out to be a member of a state licensed profession. * * * ” (Emphasis added.) | [
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Per Curiam.
Defendant was arrested on a warrant for violation of plaintiff township’s zoning ordinance restricting land use in that he had placed a mobile home on his land, contrary to the ordinance. The case was initially heard before a justice of the peace and defendant was found guilty and ordered to remove the mobile home within seven days, or to serve ten days in jail in lieu of which he might pay a $50 fine. Defendant appealed to the Benzie county circuit court where the case was tried de novo on the merits. The circuit court concurred in the decision of the justice court, placing defendant on probation and assessing court costs, with a further provision that the mobile home be removed within 20 days. The only issue presented by defendant in the circuit court concerned the constitutionality of the zoning ordinance. The trial court found that the ordinance was reasonable and constitutional and defendant does not challenge that finding on appeal. Instead, he contends that the circuit court was without jurisdiction to hear the case because of allegedly improper service of process and other procedural errors.
The record indicates that defendant was personally present during all of the lower court proceedings. He was given a fair and impartial trial concerning the issue which he presented, the constitutionality of the zoning ordinance.
Defendant seeks to raise ten issues on appeal. Yet, none are properly before this court. The issues concerning the warrant and jurisdiction of the court were not raised for the consideration of the trial court, and in view of the record, they will not be considered on appeal. People v. Matteson (1937), 280 Mich 218; People v. Huey (1956), 345 Mich 120; People v. Elliot (1948), 322 Mich 313; People v. Willis (1965), 1 Mich App 428; People v. Dodson (1967), 9 Mich App 123, 127; People v. Underwood (1969), 19 Mich App 509.
Having found no miscarriage of justice on this record, we affirm. MCLA § 769.26 (Stat Ann 1954 Eev§ 28.1096).
Affirmed. | [
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Lesinski, C. J.
Defendant Carroll Way was committed to the Department of Mental Health for treatment following his acquittal by a jury of first-degree murder. The lower court based its action on MCLA § 767.27b (Stat Ann 1970 Cum Supp § 28.966[12]) Defendant brings this appeal as of right from his commitment.
Defendant was tried for the murder of his wife’s paramour. At arraignment defendant stood mute and a plea of not guilty was entered. Following proper notice, defendant produced evidence supporting a defense of insanity.
At the close of evidence the trial court instructed the jury that four verdicts were permissible: guilty of first-degree murder, guilty of second-degree murder, guilty of manslaughter, and “not guilty by reason of insanity.” A conference between counsel and the court was held out of the hearing of the jury after the instructions. Following the conference, further instructions were given, in the course of which the court again stated there were four possible verdicts. After reiterating the three guilty verdicts previously given, however, the court then-stated : “and the fourth would be not guilty.”
The jury returned a verdict of “not gmilty.” After excusing the jury the judge stated that he interpreted the verdict as meaning “not guilty by reason of insanity” and had defendant committed.
The sole issue on appeal is whether the trial court’s action was correct. For the reasons set forth below, we determine that the commitment of defendant was improper and remand.
It is well settled that a jury is always legally entitled to return a general verdict of not guilty in a criminal case. In People v. Clark (1940), 295 Mich 704, 707, the Court stated:
“One of the substantial elements of the constitutional right to trial by jury is the right of the jury, in criminal cases, to give a general verdict on the merits. Underwood v. People, 32 Mich 1 (20 Am Rep 633).”
See, also, People v. Young (1969), 20 Mich App 211.
This also holds where defendant has served the required notice of intent to produce evidence supporting an insanity defense. In People v. Woody (1968), 380 Mich 332, defendant gave notice of the defense of not guilty by reason of insanity. Beginning at p 337, the Court stated:
“In affirming the conviction the Court of Appeals held:
“ ‘The plea of not guilty by reason of insanity made the issue defendant’s sanity at the time of the offense, not whether he killed his wife.’
“We feel obligated to point out that any implication from the above language that in these circumstances the jury cannot bring in a general verdict of not guilty should be dispelled. This was early decided and we do not find the holding has ever been disturbed.
“In People v. Marion (1874), 29 Mich 30, 40, 41, we said:
“ ‘As it is one of the most essential features of the right of trial by jury at common law, that no jury should be compelled to find any but a general verdict in criminal cases, and the removal of this safeguard would violate its design and destroy its spirit, we cannot suppose the legislature intended to introduce such a revolution into the criminal law by any indirection.’
“In Underwood v. People, 32 Mich 1, 2, 3, we approved the holding:
“ ‘As suggested in People v. Marion, 29 Mich 31, one of its [trial by jury] substantial elements is the right of the jury to give a general verdict on the merits. * # * And while it is not competent to prevent an acquittal on a reasonable doubt of insanity, which would require a general verdict of not guilty, yet if the jury agree that the prisoner was insane, and that he would have been guilty if not so, they are undoubtedly at liberty, though they cannot be compelled, to find that fact specially.’
“To the extent then that the language of the Court of Appeals be read to mean the contrary, we disapprove it.”
This Court applied the Woody decision in People v. Deneweth (1968), 14 Mich App 604, holding it to be reversible error for the trial court to instruct the jury that it could not bring in a general verdict of not guilty where defendant raised the defense of insanity.
Therefore, the jury was legally entitled to return a verdict of not guilty.
The interpretation of the “not guilty” as “not guilty by reason of insanity” by the trial court was improper. It assumed that the jury was required to make a factual determination that defendant committed the killing and that the only question was his sanity. As noted above, however, this assumption was specifically rejected by the Supreme Court in Woody, supra. Moreover, in People v. Deneweth, supra, concurring opinion, Levin, J., at p 607:
“The defendant pled not guilty. A plea of not guilty puts in issue every element of the people’s ease. That view of the matter is not affected by the fact that the defendant gave notice as required by the statute (MCLA § 768.20 [Stat Ann 1954 Rev § 28.1043]) of his intention to introduce evidence in support of an insanity defense.”
The verdict “not guilty” is neither inherently ambiguous nor void. Standing alone it is not subject to any interpretation except a general acquittal. It means only that the jury concluded that the prosecution failed to prove beyond a reasonable doubt that defendant committed the act with requisite intent as charged.
MCLA § 767.27b (Stat Ann 1969 Cum Supp § 28-.966[12]) provides in pertinent part:
“Any person, who is tried for a crime and is acquitted by the court or jury by reason of insanity, shall be committed immediately by order of the court to the department of mental health.” (Emphasis supplied.)
The statute clearly requires a verdict of “not guilty by reason of insanity” as a prerequisite of commitment under its provisions. The statute may not be applied where the jury returns a verdict of “not guilty.”
On remand the trial court will enter its order releasing defendant from the Department of Mental Health.
Remanded for actions consistent with this opinion.
All concurred.
The statute provides:
“Any person, who is tried for a crime and is acquitted by the court or jury by reason of insanity, shall be committed immediately by order of the eourt to the department of mental health for treatment in an appropriate state hospital, until discharged in accordance with act No 151 of the Public Acts of 1923, as amended. The person shall not be released on convalescent care or final discharge without first being evaluated and recommended for release by the center for forensic psychiatry.”
MCLA § 768.20 (Stat Ann 1954 Rev § 28.1043).
The record discloses the following colloquy:
“The Court: I believe that this jury found this defendant not guilty by reason of insanity, by reason of the only defense you interposed. You did not deny the doing of the act.
"Mr. Gillis: We did, your Honor.
“The Court: No. The defendant got on the stand and said he didn’t remember.
“Mr. Gillis: A plea of not guilty denies all of the elements that the people have to prove.
“The Court: I think this is the proper thing to do. You may test it by a writ of habeas corpus. You will have to take the defendant into custody.”
As observed in People v. Deneweth (1968), 14 Mich App 604, concurring opinion, Levin, J., at p 607, by way of footnote:
“In Michigan there is no such thing as a plea of not guilty by reason of insanity. A defendant who wishes to raise an insanity defense pleads not guilty or a plea of not guilty is entered for him. Where an insanity defense is interposed the judge should charge the jury that it can bring in a general verdict of not guilty (Underwood v. People [1875], 32 Mich 1) as well as a verdict of not guilty by reason of insanity. See MCLA § 767.27b and People v. Dubina (1943), 304 Mich 363.”
Cf: People v. Young (1969), 20 Mich App 211. | [
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Y. J. Brennan, J.
The question here is whether the 1967 amendment of section 724(c) of the motor vehicle code eliminates scienter as an element of the misdemeanor defined by sections 716(a) and 722 of the code. We conclude that it does not.
On March 19, 1968, a weighmaster in Monroe County weighed a true]? owned by defendant Bark-man, found that its weight exceeded the limitations prescribed in section 722 of the motor vehicle code, and issued a notice of violation. At the trial in the circuit court, the prosecutor established that the defendant owned the truck and that it had indeed been driven on a public highway while “grossly” overloaded, and then rested his case, making no showing that the defendant knowingly permitted the truck to he driven while overloaded. The defendant moved for dismissal, contending, inter alia, that he could not he found guilty of the misdemeanor defined by section 716 without a showing of scienter on his part. In opposition to this motion, the prosecutor offered for the court’s consideration an opinion of the Attorney General, one requested by the prosecutor before trial, wherein the Attorney General expressed his view that scienter is no longer an element of the misdemeanor. The circuit court accepted this view, denied the motion, and levied the fine prescribed by section 724(c) when the defendant offered no.proofs in his defense. The defendant appeals.
Section 716(a) provides in relevant part:
“It is a misdemeanor for any person to drive or move or for the owner to cause or knowingly permit to he driven or moved on any highway any vehicle or vehicles of a size or weight exceeding the limitations stated in this chapter or otherwise in violation of this chapter * * * .”
Section 722 prescribes the weight limitations while section 724(c) prescribes the fines for violation of these limitations. Before amendment, section 724(c) read in part:
“Any owner of any vehicle as defined in this act, or any lessee, who violates the provisions of section 722 is guilty of a misdemeanor and upon conviction thereof shall be assessed a fine in an amount equal to * * * .”
In People v. Brown Bros. Equipment Company, Inc. (1966), 3 Mich App 618, this Court considered 724(c) in its unamended form and concluded that a showing of scienter is required before a fine may be levied, even though 724(c) makes no mention óf scienter. We said there, at 621:
“By its terms, section 724, subd (c) is related to section 722 of the act which establishes the lawful spacing between axles, axle load and wheel load. Section 724, subd (c) further establishes the fine to be levied for violation of section 722. These two sections read standing alone do not indicate the necessary elements of a crime, principally because the sections do not speak of an act, but rather of a condition. Thus, to make these sections meaningful, it is necessary to read other portions of the act. A complete reading of the sections of CLS 1961, § 257.716 et seq., supra, indicates its concern with the weight, size and load moved upon the highways of this State.
“Specifically the responsibility of an owner for an overloaded vehicle is found in section 716, subd (a) wherein it provides that if the owner causes or knowingly permits an overloaded vehicle to move upon the highways of this State, he shall be guilty of a misdemeanor.
“In the face of the provisions of section 716, subd (a), we cannot reason that by failure of the legislature to include in section 724, subd (c) the phrase ‘to cause or knowingly permit to be driven or moved’ the legislature intended scienter to be excluded as an element necessary to constitute a violation of the act.”
This construction of the code was later approved by the Supreme Court.
In 1967, section 724(c) was amended to read (again in part):
“Any owner of any vehicle as defined in this act, or any lessee of the vehicle of an owner-operator, who causes or allows a vehicle to be loaded and driven or moved on any highway, when the weight of that vehicle violates the provisions of section 722 is guilty of a misdemeanor and upon conviction thereof shall be assessed a fine in an amount equal to * * * .” (Emphasis added.)
It is the italicized portion of this amendment that the Attorney General and the prosecutor rely on in saying that the amendment eliminates scienter as an element. In the opinion submitted to the circuit court, the Attorney General said:
“Section 724(c) now speaks of an act; that of causing or allowing an overloaded vehicle to be driven or moved on any highway. Also, by the express terms of the section ignorance of the occurrence of the acts that caused the offense — overloading the vehicle — cannot constitute a defense. In order to complete the offense an owner or lessee need only allow an overloaded vehicle to be driven or moved on a highway.
“This conclusion is reenforced when Section 724 (c) is compared to Section 724(d) and Section 724 (f). Subsections (d) and (f) both condemn as a misdemeanor a knowing failure to stop a vehicle at a weighing station or at the command of an authorized official for the purpose of weighing the vehicle.”
We cannot accept this analysis of the amendment. Although the subsection as amended does speak of an act rather than of a condition, a distinction made in Brown Bros., to point out that the subsection deals with penalties, not elements, that it speaks of an act is by no means conclusive. A regulation may speak of an act rather than of a condition and still require scienter as an element. Nor can the addition of the language “causes or allows * * * ” to the subsection be fairly taken to mean that the legislature intended to eliminate scienter, especially when one considers that the addition was made after the subsection had been authoritatively construed as requiring* scienter. The words ‘cause’ and ‘allow’ simply do not carry the force needed for this construction. If anything, they imply knowledge or scienter on the owner’s part. See State of New Jersey v. American Alkyd Industries, Inc. (1954), 32 NJ Super 150 (107 A2d 830); Sawyer v. Mould (Iowa, 1909), 122 NW 813; City of Eastlake v. Ruggiero (1966), 7 Ohio App 2d 212 (220 NE2d 126); Colonial Stores, Inc. v. Scholz (Ga, 1945), 36 SE2d 189; Thurman v. Adams (1903), 82 Miss 204 (33 So 944). Most importantly, were we to construe this amendment as eliminating scienter, we would have to ignore the clear and as yet unamended language of section 716(a), language that cannot be ignored: “It is a misdemeanor for * * * the owner to cause or knoivingly permit to be driven * * * any vehicle * * * of a weight exceeding the limitations stated in this chapter * * * .”
We note in passing that the Attorney General’s reliance on the presence of the word “knowingly” in subsections (d) and (f) of 724 and its absence in (c) is misplaced. It is true, of course, that “knowingly” is used in (d) and (f) and not in (c). But it is used in these subsections because these subsections define, for the first time in the code, substantive offenses, namely, the knowing failure to stop at a weighing station and the knowing failure to stop on the request of an authorized person. Subsection (c) does not define a substantive offense, but merely prescribes the fine for the substantive offense defined earlier in the code by section 716 (a) — knowingly permitting to be driven any vehicle of a weight exceeding the limitations stated in section 722. Repetition of the elements in the section prescribing* the penalties is unnecessary.
Reversed and remanded for entry of an order granting defendant’s motion for dismissal.
All concurred.
PA 1967, No 277, § 1 (MCLA 1969 Cum Supp § 257.724[e]).
MCLA § 257.716 ert seq. (Stat Aun 1960 Roy § 9.2416 et seq.).
People v. Brown Brothers Equipment Company, Inc. (1967), 379 Mich 363. | [
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Lesinski, C. J.
Plaintiffs appeal a circuit court judgment in favor of defendants denying foreclosure and sale of certain land and property in Tawas City, Michigan. The stipulated facts are as follows:
On September 24, 1953, plaintiffs, as vendors, and defendants Wilmer L. Weber and Anne Weber, as vendees, executed a land contract for the sale of a motel and land. The $36,000 contract (hereinafter referred to as the 1953 contract) provided for a down payment of $13,500 and payments of $125 per month (principal and interest). Inter alia, the 1953 contract contained the following provision:
“9. The purchaser covenants and agrees that he will not assign or convey his interest, or any part thereof, in this contract without having first obtained the written- consent of seller. Any violation by the purchaser of this condition shall be considered a default of one of the conditions of this contract.”
The Webers have tendered and plaintiffs have accepted all monthly payments from September 24, 1953 to and including January 16, 1967 (leaving a balance, at the latter date, of $13,634.35).
On January 17, 1967, the Webers, without plaintiffs’ consent, executed a land contract for the sale of the Tawas City site to defendants Mr. and Mrs. Eldon J. Dreher. This contract (hereinafter referred to as the 1967 contract) provided for a $5,100 down payment (to the Webers), and a balance of $14,000 payable at $125 per month (principal and interest). On February 18, 1967, the Drehers sent plaintiffs a check for $125 and a note stating that “until further notice, we will be making the [1953] land contract payments for Mr. and Mrs. Weber.” Plaintiffs refused to accept this check. However, the Webers again tendered that payment and the next payments (from February 18, 1967 to and including the date of this action) to plaintiffs, who retained but did not cash the checks.
Subsequently, on March 16, 1967 and on May 5, 1967, “notices of intention to declare forfeiture” were sent to the Webers by plaintiffs. When no response was received, the plaintiffs brought the foreclosure action resulting in this appeal.
We are asked first to determine whether paragraph 9 of the 1953 contract is valid, and second, whether the 1967 contract constituted a violation of paragraph 9. Defendants’ contention, concurred in by the trial court, is that paragraph 9 is an unreasonable restraint on the alienation of property and hence null and void. We do not find it necessary to decide this issue at this time.
Assuming arguendo that paragraph 9 is valid and that the 1967 contract constituted a default thereunder, we fail to see where plaintiff has been damaged or his position as vendor-creditor made less secure. It is axiomatic that a person cannot convey greater title than he possesses. The Webers possessed only the equitable title to the property and the facts indicate that the Drehers entered into the 1967 contract with notice of this fact. Thus the Webers and the land itself remain primarily liable upon the 1953 contract and the Drehers are estopped to deny the plaintiffs’ legal title until the full purchase price (of the 1953 contract) has been paid. See Cutler v. Lovinger (1920), 212 Mich 272.
Restraints on alienation of property are strongly disfavored in Michigan. Mandlebaum v. McDonell (1874), 29 Mich 78, 107; Fratcher, Restraints on Alienation of Equitable Interests in Michigan Property, 51 Mich L Rev 509 (1953). Where they are permitted, they are strictly construed to prevent a forfeiture. Ortmann v. First National Bank of Monroe (1882), 49 Mich 56; Hodges v. Buell (1903), 134 Mich 162; Hull v. Hostettler (1923), 224 Mich 365. Here plaintiffs have not made any allegations of waste or impairment or loss of security. They continue to enjoy the benefit of their 1953 contract. See Jankowski v. Jankowshi (1945), 311 Mich 340. Hnder the facts of this case we will not require a forfeiture; to do so would be to impose an unreasonable restraint on the alienation of an equitable interest in real property.
Affirmed.
All concurred.
The claimed grounds of default were: ( 1) nonpayment of the February 18, 1967 installment and (2) violation of paragraph 9 of the 1953 land contract. The first claimed default has since been dropped by the parties from consideration.
The validity of provisions restricting assignment of land contracts has long been assumed in Michigan. See Goddard, Non-Assignment Provisions in Land Contracts, 31 Mich L Eev 1 (1932), and especially Sloman v. Cutler (1932), 258 Mich 372, However, our research discloses no Michigan case where the question has been decided in a foreclosure action between the original vendor and his vendee. Perhaps a reevaluation of the dicta in cases such as Sloman v. Cutler and Jankowski v. Jankowski (1945), 311 Mich 340, is in order by the Supreme Court. This course has been suggested by various authors as a measure necessary to protect the lives and life savings of people of modest (and less than modest) means. See, for example, Frateher, Restraints on Alienation of TSguitable Interests in Michigan Property, 51 Mich L Rev 509. 551 (1953).
Assignatus utitur jure auctoris, Blade’s Law Dietionary (4th ed), p 152, citing authority. | [
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Per Curiam.
Defendant was charged with armed robbery on two separate and unrelated complaints, contrary to CL 1948, § 750.529 (Stat Ann 1954 Rev § 28.797). He filed an affidavit of indigency and was furnished different counsel for each charge. He was arraigned on one of the armed robbery charges, and pleaded not guilty. Thereafter, an amended information was filed, adding Count II, unarmed robbery, MCLA § 750.530 (Stat Ann 1954 Rev § 28.798) to the Count I charge of armed robbery. At a second arraignment, defendant, with the same counsel, entered a plea of guilty to the unarmed robbery charge in Count II. The armed robbe1""" complaints were dismissed. Defendant contenas that the plea was not freely and voluntarily made because of the following colloquy between court and counsel at the time of sentencing:
“Mr. Wenzel [defense counsel] : Well, your Honor, it is my understanding that — with Mr. Kowalski [prosecutor] that the other charges would be nolle-prossed at this time. It that correct, Mr. Meden? [Assistant prosecutor.]
“The Court: My understanding is that the other matter will be dismissed.
“Mr. Meden: Yes, count one will be dismissed.
“Mr. Wenzel: ■ — and the other charges against Mr. Anderson—
“Mr. Gillard: I represent Mr. Anderson on the other charges [unrelated unarmed robbery com plaint] and it is my understanding that that would be dismissed.
“The Court: Well, I’m sure Mr. Kowalsid will honor his commitments with these other gentlemen and dismiss all those other charges — - * * * .”
Armed robbery carries a penalty of confinement for life or for any term of years. The maximum for unarmed robbery is 15 years. Defendant contends, in view of the possible longer armed robbery sentence, that he became the victim of plea bargaining and was coerced into making the plea of guilty to the lesser charge of unarmed robbery, in violation of GCB. 1963, 785.3(2). The defendant’s minimum sentence was set at five years, with 139 days credit for time served.
Defendant, in the presence of his counsel, made the following admission to the court:
“The Court: Out of his wallet? So you took it [money] from the person of this Theodore Blevins, is that right ?
“Defendant: Yes.”
The truth of a guilty plea has been reasonably ascertained when the trial judge, after questioning the defendant as required by court rule and case law, ascertains that there is a factual basis for the plea, and that the plea is a truthful, honest plea of guilty to an offense of which the accused person might well be convicted upon trial. People v. Bartlett (1969), 17 Mich App 205.
The record in the instant case clearly establishes that the court properly accepted the plea. Defendant’s contention that the sentencing judge took an active part in the charge reduction, thereby in some way forcing him to plead guilty to the lesser crime of unarmed robbery, is unsupported by the record. Court acknowledgment of previous plea bargain ing, without more, is insufficient grounds for withdrawing the plea. People v. Earegood (1968), 12 Mich App 256.
Defendant’s claim that his plea was induced by a promise that another charge pending against him would not be prosecuted is supported in the record. However, the promise has evidently been kept, and a fulfilled promise of such a nature is not a ground for vacating a guilty plea, even if the plea was induced thereby. People v. Kindell (1969), 17 Mich App 22.
Acceptance of guilty plea and conviction affirmed. | [
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Quinn, J.
Defendant was charged with the common-law rape of his 16-year-old stepdaughter. At arraignment, he pleaded not guilty. January 10, 1968, with his counsel present, defendant pleaded guilty to attempted rape. CLS 1961, § 750.520 (Stat Ann 1954 Rev § 28.788) and CL 1948, § 750.92 (Stat Ann 1962 Rev § 28.287). He was sentenced and thereafter moved to withdraw his plea. This motion was denied and defendant appeals.
The basis for the appeal is defendant’s contention that the plea transcript fails to disclose that the offense was accomplished by force and against the will of complainant; thus, a necessary element of the crime is not disclosed. The plea transcript supports that contention.
However, the sentencing transcript discloses the following:
“The Court: And she claims, although you don’t say it was so that she was forcibly taken into her room, slapped beforehand. She immediately, informed her mother of what happened and you admitted penetration of her sexual organ by yours. ■Slated that you found her sexually attractive and could not control your emotions. Admits slapping her and carrying her into the bedroom which is inconsistent with the theory of her willingness. . Admits in this statement, forced. on the bed and admitted' that you are aware of your deplorable behavior. A
# # #
“The Court: Dr. Wohelert says yod'aré deviated that way, as a rapist and you are not only that, you are alcoholic, and with this force you are dangerous. Sweet words get results but the use of force makes you dangerous. At least one may be overcome with sweet words and do something one ought not to do, but when you use force the female has no choice, and frankly, a prison sentence hasn’t done any good, but I don’t believe it is safe to leave you at liberty, I really don’t. I would look upon it differently, but this is force and all I know is all the others were force, for all I know. The use of marijuana and if as you admit the use of whiskey might one day take you to a point where not only would you use force and violence, you might go as far as death itself.
“I don’t know whether any of these others were the result of hanging around in the wee hours of the night waylaying some woman or not. This one wasn’t so.
“Now, that’s all I have to say. I have been rambling along in this fashion because I want the record to show some justification for whatever action I take. That is required under the rules. The rules often give you an opportunity to speak and your lawyer has always had that right.
“All right. Do you want to say anything?
“The Defendant: No, your Honor.”
A motion to withdraw plea of guilty after sentence is addressed to the court’s discretion. People v. Lang (1968), 381 Mich 393. Appellate relief is. granted if the record demonstrates an abuse of discretion. People v. Crane (1949), 323 Mich 646.
The excerpts quoted above demonstrate that force was involved, and this precludes a finding that the trial judge abused his discretion in denying the motion to withdraw the plea.
Affirmed.
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Fitzgerald, J.
The record, depositions and trial transcript of this appeal show that plaintiff was granted a divorce from her husband and that the judgment provided that each was granted a one-half interest as tenants in common in the property involved in the instant litigation. Plaintiff lived on the property for about four years after the divorce.
There is also evidence that Mrs. Mallick spent eight weeks in Northville State Hospital as a voluntary patient because of a physical and mental breakdown. However, when she left the hospital, she was told that she was well, but was cautioned by her doctors to avoid irritation.
In her deposition taken February 9, 1967, and at trial, plaintiff maintained that she wanted to gain title to the entire property involved in this dispute. She hired a succession of lawyers who seemed to be able to do little for her. Two offers of $35,500 to purchase the land were made by one John Nellis, but these offers were allegedly not accepted by plaintiff because she was prevented from doing so by her attorney. Mrs. Mallick testified that her attorney was instructed to purchase the land for her.
Pursuant to a partition suit instituted by Michael Mallick, the divorced husband, a public sale was held on November 29, 1960. The facts surrounding the sale are involved, but suffice it to say, the highest bid, $30,000, was tendered by plaintiff’s attorney. Under the terms of the sale, cash payment was required within 48 hours. The attorney had been given no money by Mrs. Mallick and apparently had none of his own. Defendant John Migut testified in his deposition taken January 31, 1967, that he was approached by Mrs. Mallick’s attorney and was convinced that both of them could make money if Migut purchased the land.
Subsequent to the public sale, plaintiff signed over her interest in the said land to defendant because of the alleged threat of her attorney that she would lose money otherwise.
Plaintiff sought to set aside a quit-claim deed which she executed to defendants and, in the alternative she sought specific performance of an agreement executed by John Migut to pay plaintiff an additional consideration for the property. The trial court ruled in favor of defendants on both counts but refused, however, to grant defendants extraor dinary costs and attorney fees. Defendants have cross-appealed from that portion of the order.
Plaintiff argues that, since this is an equitable matter, this Court, utilizing its ele novo review-powers, may set aside any injustice done below, specifically claiming that the action was against the great weight of evidence. Defendants argue that they made no misrepresentations in acquiring the property, thus the sale should be permitted to stand.
The trial court’s opinion stated that, “There is other evidence that he [defendant Migut] was not scrupulously interested in the legal refinements of * * * [the attorney’s] authority.” The court commented on the evidence of plaintiff’s emotional instability and physical illness; yet, in spite of these factors, did not grant plaintiff equitable relief.
Defendant argues that it is irrelevant that the attorney may have acted in bad faith for there was no evidence that Mrs. Mallick could have paid for the land and that the purchase price of $31,000 was a greater amount than would have been received at the public sale.
There is little doubt that an attorney has the duty of demonstrating professional skill and care and he must show loyalty to his client, since he is in a position of the highest trust and confidence. See Kukla v. Perry (1960), 361 Mich 311; Rippey v. Wilson (1937), 280 Mich 233, and McIntosh v. Fixel (1941), 297 Mich 331. As defendants aptly point out, however, this is an action against third-party purchasers and not against plaintiff’s attorney.
Plaintiff herself asks the next logical question: Did defendant John Migut in any way partake in a wrongdoing by the attorney? It is apparent that participation'in wrongdoing is not enough. Unless there is some indication that plaintiff suffered injury, she cannot recover. See Smith v. Taber (1961), 362 Mich 619, which recites the basic proposition that a necessary element of actionable fraud is injury to the plaintiff.
A review of the record indicates that the only possible injury to Mrs. Mallick was that she lost the land. The sale of the land was ordered by the court. It is purely speculative to assume that she could have raised the money to bid at the sale when, in fact, she had failed to buy the land for years. There was mention made of an offer to purchase of $38,000. However, no evidence was adduced to prove the validity of the offer. We cannot say that the trial court acted against the great weight of evidence in dismissing plaintiff’s fraud allegations.
The second question on appeal is whether the findings of the lower court were against the great weight of evidence in granting defendant a motion to dismiss on plaintiff’s allegations of an addendum to which she was entitled to specific performance.
At trial, plaintiff produced an addendum to the original purchase agreement between her attorney and Migut which reads :
“Additional Clause, Mallick — Migut Purchase Agreement as of November 29,1960. The purchaser, John Migut, agrees to pay as further consideration for the purchase of the Mallick Hicks Road property one-half the sale price of the home and land over and above $25,000 costs and expenses of sale (after sand removal from approximately 15 acres to grade in accordance with all governmental requirements).
“The sale of the house and land may be made subject to purchaser’s sand removal rights to grade.
“It is agreed that sale shall be made as promptly as possible.
“Dated: November 29, 1960.”
/s/
The court refused to grant specific performance of this agreement. Testimony supports this decision. Mr. Migut testified that this instrument was executed about eight weeks after the public sale to help the attorney who was involved in a complaint with the bar association and later cleared. The quitclaim deed given by Mrs. Mallick was unconditional on its face and made no mention of conditions as described in the addendum. The trial court is affirmed. As stated in Star Realty, Inc., v. Bower (1969), 17 Mich App 248, the Court of Appeals hears appeals of equity cases de novo, but gives great weight to the findings of fact of the trial judge and does not reverse unless it finds from a reading of the entire record that it would have reached a different result and that is not the situation here.
On defendants’ cross appeal, they cite GCR 1963, 111.6, and Fredal v. Forster (1967), 9 Mich App 215, which authorizes the granting of reasonable attorney fees if the allegations made were unreasonable. The wording of rule 111.6 is that “the court may * * * ” assess reasonable attorney fees. Under the circumstances of the case at bar, where there is evidence that defendants did not act in good faith, it was not an abuse of discretion to not award reasonable attorney fees.
Affirmed. Costs to appellees.
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Danhoe, J.
On December 14, 1963 plaintiff was involved in an automobile accident with a vehicle owned by the defendant Frank La Fave and driven with ’his knowledge and consent by defendant Timothy Kelleher. At the time of the accident both defendants, Kelleher and La Fave, were members of the armed forces assigned to the Belle Isle Missile Base within the State of Michigan. Subsequently, defendant Kelleher was discharged from the armed forces and returned to his home city of Cincinnati, Ohio as of January 29, 1964. From and after January 29, 1964 defendant Kelleher resided at various addresses, all in Cincinnati, Ohio. The complaint in this case was filed on November 17, 1966 and copies of the complaint and the summons were, in good faith, put in the hands of an officer for immediate service. The record discloses that a copy of the summons and the complaint were served upon the secretary of state in November of 1966 and a notice of this, together with a copy of the summons and the complaint were sent by certified mail to defendant Kelleher addressed as follows: Timothy John Kelleher, 3243 Woodfield, Cincinnati, Ohio. This mail was returned to the plaintiff’s attorney marked “unclaimed.” On March 5,1968 defendant Kelleher was personally served with a copy of the summons and the complaint at his residence 2445 Westwood Northern Boulevard, Cincinnati, Ohio. By affidavit defendant alleges that at no time did he reside at 3243 Woodfield, Cincinnati, Ohio, although he did reside at 3243 Whitfield, Fessell Garden Apartments, Cincinnati, Ohio from September 1, 1964 until September 30, 1965.
Defendant Kelleher, pursuant to GCB, 1963, 116 filed a motion for an accelerated judgment pleading the statute of limitations. The trial court by written opinion granted defendant’s motion for accelerated judgment and pursuant to GCB 1968, 806.1, plaintiff brings this appeal.
The question that this Court is asked to answer is whether there was proper service upon the defendant Kelleher before plaintiff’s cause of action was outlawed by the statute of limitations. Plaintiff’s cause of action is governed by the provisions of CLS 1961, § 600.5805 (Stat Ann 1962 Rev § 27A.5805) and thus the statute of limitations absent a tolling of the statute, would have run as of December 14, 1966. The trial court found that the plaintiff, in good faith, placed the summons and complaint in the hands of an officer for service. Thus, the statute was tolled for an additional time of 90 days as provided by CLS 1961, § 600.5856 (Stat Ann 1962 Rev § 27A.5856).
Plaintiff claims that the provisions of MCLA 1969 Cum Supp § 257.403 (Stat Ann 1968 Rev § 9.2103) which provides for service on nonresident operators or owners of motor vehicles has been met if service is made upon the secretary of state within the three-year period, and thereafter service is in fact accomplished upon the defendant by personal service or registered mail. Plaintiff claims that to require him to obtain either personal service or service by registered mail upon the nonresident defendant within the statutory period will make a nullity of the nonresident motorist statute. Thus, in essence what plaintiff claims is that the statute of limitations is tolled upon the filing of the complaint and the service of process upon the secretary of state and that he may thereafter serve the actual defendant beyond the statutory time. While sympathy may be expressed for this view the Supreme Court of Michigan and this Court have determined otherwise. In Bush v. Watson (1966), 3 Mich App 94 this Court stated:
«There is no provision in any statute for tolling of the statute of limitations in the event the plaintiff is unable to locate a nonresident motorist defendant notwithstanding the fact that he has made diligent effort to do so. The only method for tolling the statute is that contained in the statutes themselves. Vega v. Briggs Manufacturing Company (1954), 341 Mich 218. The remedy, if any, under these circumstances, is for legislative action.”
Thus, we must look to the statutes as to whether the statute of limitations was in fact tolled. CLS 1961, § 600.5853 (Stat Ann 1962 Rev § 27A.5853) states:
“If any person is outside of this state at the time any claim accrues against him the period of limitation shall only begin to run when he enters this state unless a means of service of process sufficient to vest the jurisdiction of a Michigan court over him was available to the plaintiff. If after any claim accrues the person against whom the claim accrued is absent from this state, any and all periods of absence in excess of 2 months at a time shall not be counted as any part of the time limited for the commencement of the action unless while he was outside of this state a means for service of process sufficient to vest the jurisdiction of a Michigan court over him was available to the plaintiff.” (Emphasis supplied.)
MOLA 1969 Cum Supp § 257.403 (Stat Ann 1968 Rev § 9.2103) supplies to the plaintiff a means of service of process sufficient to vest jurisdiction of a Michigan court. Consequently, there is no tolling of the statute because defendant Kelleher resided in the state of Ohio. Justice Kelly writing for a unanimous Court in Hammell v. Bettison (1961), 362 Mich 396 commented on this question, p 405:
“ ‘The fictional presence of a defendant by an agent, imposed by law upon the defendant, brings the defendant within the state for purposes of serv ice of process and the same fiction causes the period of limitations to run.
“ ‘To hold otherwise would be to permit a plaintiff, who has a claim against a nonresident operator or owner of a motor vehicle, to ignore indefinitely his right to make use of substituted service of process and bring an action thereunder whenever he chooses without any regard whatsoever for the periods of limitations.’ ”
And further on p 408:
“After consideration of decisions from other jurisdictions and the briefs and appendix submitted on this appeal, this Court adopts the majority decision of the several states, namely: That the statute of limitations is not suspended during the absence from the state of a nonresident motorist.”
In addition, our Supreme Court has held in Tomkiw v. Sauceda (1965), 374 Mich 381, that the nonresident motorist statute requires actual notice of the pendency of the action before jurisdiction is acquired over the defendant. On p 386 they quoted with approval 8 Am Jur 2d, Automobiles and Highway Traffic, § 867, p 423:
“ ‘Some courts have construed such provisions to mean the defendant must have actual notice of the pendency of the action before jurisdiction over him is acquired, and have held that where the registered mail is returned undelivered, there is no valid service upon the defendant, particularly where the statute requires that the return receipt be made a part of the record of the substituted service, or requires personal delivery of the registered mail.’ (Emphasis supplied.)
“We find this position to be the most tenable, especially since the applicable Michigan statute does require that the return receipt be made a part of the record of service.”
Thus, plaintiff is required to obtain either personal service or service by certified mail upon defendant Kelleher within the three-year and 90-day time limit granted to him by the statutes. Since defendant Kelleher was not served until June 5, 1968, the granting of the motion for accelerated judgment was proper.
Affirmed, costs to defendants-appellees.
All concurred. | [
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Williams, J.
Plaintiff-appellant, Dukesherer Farms, Inc., filed a class action on behalf of all cherry producers in the state of Michigan seeking a permanent injunction against further implementation of the Michigan Cherry Promotion and Development Program instituted pursuant to the Agricultural Commodities Marketing Act, MCL 290.651 et seq.; MSA 12.94(21) et seq. The complaint further sought a declaration that the Michigan Cherry Promotion and Development Program and the Agricultural Commodities Marketing Act are unconstitutional.
We affirm the decisions of the trial court and the Court of Appeals, find both the program and the act constitutional and therefore deny any right to a permanent injunction.
I. Facts
The Agricultural Commodities Marketing Act, MCL 290.651 et seq.; MSA 12.94(21) et seq. (hereinafter referred to as the Act) became effective March 31, 1966, with the purpose of providing a procedure whereby marketing programs could be established for a wide variety of Michigan’s agricultural products. A "marketing program” is defined by the Act as follows:
" 'Marketing program’ means a program established by order of the director pursuant to this act, prescribing rules and regulations governing the marketing for processing, distributing, selling, or handling in any manner of any agricultural commodity produced in this state during any specified period and which he determines would be in the public interest.” MCL 290.652(i); MSA 12.94(22)(i).
The content of a marketing program is also set forth in the Act:
"Any marketing agreement or program issued pursuant to this act may contain one or more of the following:
"(a) Provisions for establishing advertising and promotional programs.
"(b) Provisions for establishing market development programs.
"(c) Provisions for establishing and supporting supplemental research programs designed to improve the market acceptability of the specific commodity and contribute to the effectiveness of the program.
"(d) Provisions for development and dissemination of market information.
"(e) Provision for contracting with organizations, agencies or individuals for carrying out any of the above activities.
"(f) Provisions for:
"(1) Establishing standards for quality, condition or size for agricultural commodities sold as fresh products for resale or processing and standards for pack and/or container for commodities sold for use as fresh products.
"(2) Inspection and grading of the fresh commodity in accordance with the grading standards so established.
"(g) Provision for determining the existence and extent of any surplus in any marketing period, for any commodity or product, or of any grade, size, or quality thereof, and providing for handling and equitably sharing the cost of such surplus handling among the producers of the commodity. Before provisions under this paragraph are included in any marketing program, particular attention shall be given to determining that Michigan producers affected by the provisions produce a sufficient proportion of the product covered by the provisions for the program to be effective in the particular market toward which the provisions would be applicable.
"(h) Provision for payment for all usable products purchased from producers according to established grade.
"(i) Provision for exemption of nonparticipating producers.” MCL 290.653; MSA 12.94(23).
The Act provides that marketing programs established under it are to be administered by a "commodity committee, to consist of an odd number of members with no less than 5 nor more than 15 * * * producers and handlers or processors * * * directly affected by the marketing program * * * ”. MCL 290.657(a); MSA 12.94(27)(a).
The Act further sets forth detailed procedures to be followed in the institution and termination of a marketing program, MCL 290.660-290.663; MSA 12.94(30)-12.94(33). Briefly stated, for the institution of a marketing program the Director of the State Department of Agriculture must receive a petition favoring adoption, signed by 25% or 200, whichever is less, of the producers of a specific agricultural commodity. The Director must then give notice of a public hearing and may appoint a temporary committee to develop the proposed program to be considered at the public hearing. The Director is required to issue a decision based upon his or her findings, including a recommendation approving or disapproving the proposed program within 45 days of the public hearing. The recommendation must contain the full text of any proposed program and be supported by evidence taken at the hearing or by documents of which the Director is required to take official notice.
If the Director of Agriculture recommends the adoption of a particular marketing program, a referendum of affected producers and processors is required within 45 days. MCL 290.661; MSA 12.94(31). The recommended program goes into effect if either of the following conditions are met:
"(a) If 66-2/3% or more by number of those voting representing 51% or more of the volume of the affected commodity produced by those voting assent to the proposal.
"(b) If 51% or more by number of those voting representing 66-2/3% or more of the volume of the affected commodity produced by those voting assent to the proposal.”
The Act requires that a marketing program include a:
"definition of terms, purpose of the program, the maximum rate of assessment, method of collection, nominating procedure, qualifications, representation and size of the committee, and other necessary provisions.” MCL 290.665; MSA 12.94(35).
The program for a given commodity is to be funded by an assessment collected from each producer of the commodity who is directly affected by the marketing program. The Act specifies that all assessments are to be used solely to defray all program and administrative costs and further requires that each program specify the maximum assessment to be collected to cover these costs. The monies so collected are declared not to be state funds, and are required to be deposited in a bank, allocated to the marketing program under which they are collected, and disbursed for the necessary expenses incurred with respect to each separate marketing program. MCL 290.658; MSA 12.94(28). The same section also provides for auditing of all expenditures and publication of an activity and financial report. Refund of surplus money is provided for in MCL 290.659; MSA 12.94(29).
The Michigan Cherry Promotion and Development Program, (hereinafter referred to as the Program), which provides for the promotion and advertising of cherries grown in this state, meets all the requirements of the Act.
At the present time this program provides for an assessment of $3.75 . per ton for tart cherries, $3.00 per ton for sweet cherries and $1.25 per ton for both tart and sweet cherries when those cherries are sold for juice purposes. The Program further provides that these assessments are to be collected by the processors of the cherries and remitted to the Michigan Cherry Promotion and Development Committee. The provisions of the Program, including the above-mentioned assessments, received the approval of the requisite number of cherry producers in a referendum conducted by the Director of the Michigan Department of Agriculture between March 3, 1972 and March 22, 1972. After approval, the cherry Program was put into operation.
On October 13, 1972, plaintiff-appellant filed a class action on behalf of all cherry producers in the state subject to assessments under the Program. The Michigan Association of Cherry Producers was permitted to intervene as a defendant.
Both the principal and the intervening defendants subsequently filed motions for accelerated judgment based on the theory that plaintiff had failed to comply with the time limits for judicial review found in the Administrative Procedures Act of 1969, MCL 24.304(1); MSA 3.560(204)0), and therefore, the circuit court was precluded from exercising subject matter jurisdiction. In an opinion dated January 30, 1973, the circuit court granted the motions and dismissed plaintiff’s complaint. The Court of Appeals affirmed, Dukesherer Farms, Inc v Director of the Dep’t of Agriculture, 53 Mich App 489; 220 NW2d 46 (1974), but this Court reversed and remanded the case to the circuit court for consideration of the constitutional challenges raised by plaintiff. 393 Mich 758; 223 NW2d 294 (1974).
In an opinion dated November 6, 1975, the circuit court granted defendants’ motion for a summary judgment on the merits of the case. This disposition was affirmed by the Court of Appeals on January 6, 1977. 73 Mich App 212; 251 NW2d 278 (1977). We granted leave to appeal June 2, 1977.
II. Issues
The issues raised in this appeal are: 1) whether the "assessments” authorized by the Agricultural Commodities Marketing Act constitute "taxes” subject to constitutional limitations and restrictions and therefore represent an unconstitutional delegation of the taxing power to producers of agricultural commodities in violation of the Michigan Constitution, 2) whether the Agricultural Commodities Marketing Act delegates general legislative power to producers of agricultural commodities in violation of the Michigan Constitution, and 3) assuming an affirmative answer to issue 1 or 2, whether previously collected assessments should be returned to plaintiff and its class and whether plaintiff-appellant should be awarded attorneys’ fees?
We decide all issues in the negative and thereby affirm the trial court and Court of Appeals.
III. Assessment or Tax
If the levy authorized by the Act is a tax rather than an assessment, there must be specific compliance with the limitations of the Michigan Constitution:
"The legislative power of the State of Michigan is vested in a senate and a house of representatives.” Const 1963, art 4, § 1.
"The legislature shall impose taxes sufficient with other resources to pay the expenses of state government.” Const 1963, art 9, § 1.
"The power of taxation shall never be surrendered, suspended, or contracted away.” Const 1963, art 9, § 2.
"Every law which imposes, continues or revives a tax shall distinctly state the tax.” Const 1963, art 4, § 32.
As correctly stated by Judge William S. White, Berrien Circuit Court, in his opinion in the instant suit, "[t]axes and assessments do have a number of elements in common. Both are exactions or involuntary contributions of money the collection of which is sanctioned by law and enforceable by the courts. Here, however, the similarity ends”. Exac tions which are imposed primarily for public rather than private purposes are taxes. See People ex rel the Detroit & H R Co v Salem Twp Board, 20 Mich 452, 474; 4 Am Rep 400 (1870). Revenue from taxes, therefore, must inure to the benefit of all, as opposed to exactions from a few for benefits that will inure to the persons or group assessed. Knott v Flint, 363 Mich 483, 499; 109 NW2d 908 (1961); Fluckey v Plymouth, 358 Mich 447, 451; 100 NW2d 486 (1960).
The Act in question specifically states that funding is to come from an assessment collected from each producer of the commodity who is directly affected by the marketing program. The Act further states that monies so collected are not state funds and are to be disbursed solely for necessary expenses incurred with respect to each separate marketing program. Thus, the Act itself is consistent with the imposition of an assessment rather than a tax; it is structured to apply to and for the benefit of producers of specific commodities.
This is not to say that the proper subject matter for an assessment as opposed to a tax is always easily distinguishable. Levies authorized by the Legislature can confer special benefits on a particular group and, at the same time, create a general benefit for all persons in the state, through, for example, stimulation of the economy.
This was the case in Milk Marketing Board v Johnson, 295 Mich 644; 295 NW 346 (1940), which involved constitutional challenges to the Michigan milk marketing law. The law was held unconstitutional on procedural grounds not relevant here. However, this Court stated in regard to the section authorizing payments by distributors for the necessary expenses of local milk marketing committees:
"The board is given power to administer the funds so collected. The statute requires this check-off to be reasonable and limits the expenditures to the purposes of the act. The check-off provision was questioned in Reynolds v Milk Commission, 163 Va 957; 179 SE 507 [1935], We agree with the holding of that court that such assessment is not the levying of a tax, nor is the act a revenue measure. The provision is merely incident to regulation of the industry and is proper under the police power of the State.” Johnson, supra, 653. (Emphasis added.)
Within a few months of Johnson, however, this Court decided Miller v Michigan State Apple Commission, 296 Mich 248; 296 NW 245 (1941). The act in question, popularly known as the "Baldwin apple act”, imposed a tax upon "putting Michigan-grown apples in the marts of commerce”. Miller, supra, 252. All monies collected under the act were to " 'be expended exclusively to advertise apples’ ”. Miller, supra, 251. The majority of this Court found the act to be constitutional and found taxation by the state for the purpose of advertising apples to be a public purpose:
"We perceive that the stimulation of so large and important an industry will result in a benefit to the general public well-being, the increased prosperity of the entire apple-growing industry of necessity being reflected throughout the commonwealth. The funds expended are not paid to apple growers or to any other particular individuals or class thereof as was the case in Michigan Sugar Co v Auditor General, 124 Mich 674 [83 NW 625 (1900)] appeal dismissed, 185 US 112 [1902]. We hold that the tax is for a public purpose.” Miller, supra, 255 (emphasis added).
Although the question of whether the levy was an assessment or a tax was not at issue in Miller, this Court clearly found that expenditures to increase the use of apples produced in Michigan were for a public purpose.
Plaintiff finds support for his position in Miller and seeks to distinguish Johnson on the basis that, unlike the instant case, Johnson did not involve levies which would be spent for promotion or to produce increased revenue for those who were required to pay. Plaintiff claims that, because the Act presently in question primarily authorizes expenditures for advertising as in Miller, the levies are for a public purpose and the proper subject matter for taxation rather than assessment. This argument ignores the fact that a specific section with which this Court dealt in Johnson stated that one of the act’s avowed purposes was to cause the increased consumption of milk.
We do not doubt that expenditures for the advertising of a specific commodity to increase the use or consumption of that commodity produced in this state could be viewed as a benefit to all. In the same respect, the imposition of provisions of the Act which allow for the institution of standards of quality and inspection systems insuring that only wholesome produce reaches the market could be viewed as a benefit to all. However, the fact that these general benefits are by-products of the Act does not deny that the benefits inure primarily to the producers. The Legislature has made a rational decision that assessment as opposed to taxation is the reasonable means of effectuation of its purpose, and examination of the underlying circumstances here does not dictate a finding that the Legislature erred. Admittedly, Johnson and Miller appear to be conflicting precedent for the instant issue, but we are not compelled by dicta in Miller to reach a different result.
The instant situation is analogous to other sitúa tions which are commonly deemed the proper subject matter for assessment such as street improvements, drains and sewers. Undoubtedly, such projects bestow incidental benefits upon the general public, but the persons who receive the tangible and most immediate benefits are the ones obligated to pay.
Other courts have examined the distinction between a tax and assessment and their decisions are instructive.
In United States v Butler, 297 US 1; 56 S Ct 312; 80 L Ed 477 (1936), the Federal Agricultural Adjustment Act of 1933 was challenged. That particular act was primarily concerned with regulation and reduction of farmland acreage. Incident to such regulation was a levy on processing commodities. The levy was designated a tax and the United States contended that the respondents had no standing to challenge the "validity of the tax”. Butler, supra, 57. In light of this assertion, United States Supreme Court stated:
"It is inaccurate and misleading to speak of the exaction from processors prescribed by the challenged act as a tax, or to say that as a tax it is subject to no infirmity. A tax, in the general understanding of the term, and as used in the Constitution, signifies an exaction for the support of the Government. The word has never been thought to connote the expropriation of money from one group for the benefit of another. We may concede that the latter sort of imposition is constitutional when imposed to effectuate regulation of a matter in which both groups are interested and in respect of which there is a power of legislative regulation. But manifestly no justification for it can be found unless as an integral part of such regulation. The exaction cannot be wrested out of its setting, denominated an excise for raising revenue and legalized by ignoring its purpose as a mere instrumentality for bringing about a desired end. To do this would be to shut our eyes to what all others than we can see and understand.” Butler, supra, 61.
The Court in Butler held that there was standing to challenge the exaction because it was not a true tax, and that the exaction must fail, partially because it "invades the reserved rights of the states”. Butler, supra, 68.
In effectuation of the purpose of an assessment, as distinguished from a tax, the spending of sums acquired through assessment must be rigidly defined and the money collected must be segregated from all other accounts. In Memphis Natural Gas Co v McCanless, 183 Tenn 635; 194 SW2d 476 (1946), a special state governmental unit was charged with the supervision, inspection and control of its public utilities. The governmental unit was financed entirely from fees exacted from the utilities based upon gross receipts. The plaintiff utility company objected to the levy, arguing that the fee collected was a gross receipts tax. The Tennessee Supreme Court responded to plaintiff’s objection as follows:
"It is true that the amount of the fees is to be 'measured by the amount of the gross receipts of each public utility’ * * * but the fees are to be kept apart and deposited in a 'Public Utility Account’ * * * and from this account only expenses of the administration and supervision of public utilities may be paid. Use of funds in the account is limited to this purpose, and payment of administrative expenses is limited by the amount of this special fund. * * * Such a levy is a special assessment for a speciSc purpose and lacks essential elements of a tax. * * * Here the legislature decided that gross receipts from business done in the State provided a convenient yardstick for measuring the fair contribution of the public utility to the administrative expense fund. * * * Law dictionaries, text books and cases from other jurisdictions, make it clear that the essential test to determine whether such fees are, or are not taxes, is whether they are, or are not paid into the general public treasury and disbursable for general public expenses. * * * ” McCanless, supra, 650-651. (Emphasis added.)
Similarly, the provisions of the Michigan Act direct that the accounts be kept apart from the general funds, and the use of the funds is limited to defined and necessary purposes.
In Wickham v Trapani, 26 AD2d 216; 272 NYS2d 6 (1966), the Agriculture and Markets Law of New York was challenged on the basis that the imposition of the assessments solely on the growers violated constitutional due process. The court rejected the contention and discussed the nature of the assessment.
"Appellant regards the assessment imposed by the Commissioner as a 'tax’ and complains that because he has derived no profit from his apple-raising endeavors he should not be compelled to pay it. It is difficult to perceive any infringement upon his constitutional rights on this basis. Indeed, the assessment here involved does not appear to be a tax at all but merely a fund-raising measure incidental to a valid regulation and this is true even though the assessment may be the heart’ of the regulatory order.” Wickham, supra, 218-219. (Emphasis added.)
Plaintiff cites four cases for the proposition that assessments for advertising are taxes. Conner v Joe Hatton, Inc, 203 So 2d 154 (Fla, 1967); Scott v Donnelly, 133 NW2d 418 (ND, 1965); Conlen Grain & Mercantile, Inc v Texas Grain Sorghum Producers Board, 519 SW2d 620 (Tex, 1975); Robison v Dwyer, 58 Wash 2d 576; 364 P2d 521 (1961). We do not find these cases to compel a finding that the assessments in question, although primarily used for advertising, are taxes.
Conner, supra, did not involve whether the levy was to be classified as a tax or an assessment; the act in that case was declared unconstitutional on the basis of inadequate standards.
In Scott, a levy was authorized under an act similar to the one in the instant case. However, the program and levies were effectuated only as to growers in specific areas of the state. The commodity involved was potatoes which were grown throughout the state and not just in the areas to which the levy applied. The "areas [involved] were not determined by the Legislature and did not constitute either municipal corporations or political subdivisions of the State”. Scott, supra, 423. The levy was held to be a tax; it conferred no benefits upon the parties required to pay beyond those inuring to potato growers throughout the state. In contrast, under the Michigan Act, special benefits inure to all producers of a particular commodity, and all such producers are assessed.
Conlen again involved a challenge to a statute similar to the Michigan statute. Over two dissents representing the views of four justices of the Texas Supreme Court, the court decided that the levy fit within the "occupation tax” provision in the state constitution. That court appeared to limit assessments to costs based on the improvement of land. We do not believe that assessments in this case should be so limited.
Finally plaintiff relies on Robison, supra. That case, however, is support for the view that a levy under circumstances similar to the instant case is not a tax. The Washington Supreme Court quoted and relied on its prior decision in State ex rel Sherman v Pape, 103 Wash 319; 174 P 468 (1918):
"These funds were not taxes levied and collected for state purposes generally, but were assessments laid upon private lands particularly for the benefits done those private lands. It was not necessary, therefore, that the sums imposed and collected should come into the state treasury as provided by art 7, § 6.”
We find that both legal precedent and common sense dictate the finding that the provisions of the Act authorizing the collection of money sufficient to support a marketing program give the commodity committee the power to assess for necessary expenses incident to the effectuation of its regulatory and promotional goals and not the power to tax for general revenue. Incidental benefits to the general public such as enhanced revenue or reputation to the state resulting from increased revenue to the producers of a particular commodity, or enhancement of the public interest through increased and enforceable standardization of grading and quality of a particular commodity, do not change the fact that it is the producer who is the direct and most immediate beneficiary of a program initiated under the Act. We neither feel compelled precedentially nor practically to overrule the legislative judgment in this case.
Because we find the levy in the instant case to be an assessment and not a tax, there is no unconstitutional delegation of the taxing power of this state.
IV. Constitutionality of Delegation to Private Individuals?
The Act in question in this case authorizes decisions to be made by persons or bodies other than the Legislature on two different levels. First, the Act places certain powers in the Director of the Department of Agriculture. Second, it places certain powers with the producers.
Appellant’s only assertion as to impermissible delegation is based on the fact that under the Act, the producers are the ones who initially petition the Department of Agriculture for potential adoption of a program and vote by referendum for actual adoption or termination of a program. Because of this, appellant asserts that marketing orders are not promulgated by the Legislature but by producers and it is the producers rather than the Legislature who are permitted to determine the existence of a rational nexus between the legislation and a legitimate objective of the state’s police power. Therefore, appellant asserts that the Act provides for an unconstitutional delegation of legislative authority to private individuals which enables those individuals to bind an unconsenting minority.
Appellant’s challenge fails, however, on the basis of both prior case law upholding similar legislation and under a thorough analysis of the Act in question based on Department of Natural Resources v Seaman, 396 Mich 299; 240 NW2d 206 (1976).
A. Caselaw
The type of delegation which exists under the Act has survived constitutional challenges before the United States Supreme Court. United States v Rock Royal Co-operative, Inc, 307 US 533; 59 S Ct 993; 83 L Ed 1446 (1939); Currin v Wallace, 306 US 1; 59 S Ct 379; 83 L Ed 441 (1939). Professor Antieau, in discussing these cases as well as others involving different and impermissible delegation, stated the following:
"There are some available indications as to when the Supreme Court will find delegations permissible or impermissible. * * * Congress cannot delegate any of its powers to private individuals. It cannot, for example, give a group of coal producers the power to make law and enforce it upon others. Nor can it delegate to private individuals in industries to be regulated the power to establish codes of fair competition. However, Congress can pass a law and prescribe the conditions of its application, including in those conditions the re quirement of a favorable vote upon referendum by the group intimately aifected, such as milk producers or growers of tobacco. ” (Citations omitted.)
Currin v Wallace, supra, dealt with the Federal Tobacco Inspection Act of 1935, which authorized the Secretary of Agriculture to designate markets at which, after two-thirds of the growers voted in favor of proposed standards, no tobacco could be offered for sale which had not been inspected and graded in accordance therewith.
In a decision upholding the legislation against an attack based on an unconstitutional delegation of legislative authority, Justice Hughes, writing for the majority, stated:
"The argument that there is an unconstitutional delegation of legislative power is equally untenable. This is not a case where Congress has attempted to abdicate, or to transfer to others, the essential legislative functions with which it is vested by the Constitution. * * * We have always recognized that legislation must often be adapted to conditions involving details with which it is impracticable for the legislature to deal directly. We have said that — 'The Constitution has never been regarded as denying to the Congress the necessary resources of ñexibility and practicality, which will enable it to perform its function in laying down policies and establishing standards, while leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determination of facts to which the policy as declared by the legislature is to apply. Without capacity to give authorizations of that sort we should have the anomaly of a legislative power which in many circumstances calling for its exertion would be but a futility.’ * * * In such cases 'a general provision may be made, and power given to those who are to act under such general provisions to fill up the details.’ * * *
"So far as growers of tobacco are concerned, the required referendum does not involve any delegation of legislative authority. Congress has merely placed a restriction upon its own regulation by withholding its operation as to a given market 'unless two-thirds of the growers voting favor it.’ Similar conditions are frequently found in police regulations. * * * This is not a case where a group of producers may make the law and force it upon a minority (see Carter v Carter Coal Co, 298 US 238, 310, 318 [56 S Ct 855; 80 L Ed 1160 (1936)]) * * *. Here it is Congress that exercises its legislative authority in making the regulation and in prescribing the conditions of its application. The required favorable vote upon the referendum is one of these conditions.” Currin, supra, 306 US 15-16 (cited with approval in Milk Marketing Board v Johnson, 295 Mich 644, 660; 295 NW 346 [1940]). (Emphasis added.)
Similarly, the United States Supreme Court upheld the Agricultural Marketing Agreement Act of 1937 which " * * * was aimed at assisting in the marketing of agricultural commodities” in Rock Royal Co-operative, supra, p 543, against an attack based on unconstitutional delegation. The act provided that a marketing order may become effective when the Secretary of Agriculture determined that the issuance of the order is approved by two-thirds of the producers interested or by interested producers of two-thirds of the volume produced for the market of a specified production area. The Secretary was empowered to conduct a referendum to ascertain whether such approval of two-thirds existed. The majority stated,
"The objection is made that this is an unlawful delegation to producers of the legislative power to put an order into effect in a market. In considering this question, we must assume that the Congress had the power to put this Order into effect without the approval of anyone. Whether producer approval by election is necessary or not, a question we reserve, a requirement of such approval would not be an invalid delegation.” Rock Royal Co-operative, supra, 307 US 577-578.
The requirement of a referendum, therefore, is not without strong precedent, and need not constitute improper delegation, but can simply be a measured decision by the Legislature to allow those most intimately affected to decide whether forming a marketing program as presented in the Act and approved by the Director is a proper manner in which to effectuate their business goals. As long as this is carried forth under sufficient standards and safeguards set up by the Legislature under the Act, or other legislation applicable thereto, there is no improper delegation of author ity. See Oakman v Wayne County Supervisors, 185 Mich 359; 152 NW 89 (1915).
B. Standards
In reviewing the standards as required by Seaman, certain
" * * * guiding principles have evolved in Michigan jurisprudence to assist in making a determination * * *.
"First, the act in question must be read as a whole; the provision in question should not be isolated but must be construed with reference to the entire act. * * *
"Second, the standard should be 'as reasonably precise as the subject matter requires or permits’. * * *
"The preciseness of the standard will vary with the complexity and/or the degree to which subject regulated will require constantly changing regulation. * * *
"Third, if possible the statute must be construed in such a way as to 'render it valid, not invalid’, as conferring 'administrative, not legislative’ power and as vesting 'discretionary, not arbitrary, authority’.” (Citations omitted.) Dep’t of Natural Resources v Seaman, 396 Mich 299, 309; 240 NW2d 206 (1976).
1. Act When Read as a Whole.
The Act, when read as a whole, clearly and sufficiently defines standards to guide growers, the Director of the Department of Agriculture and the commodity committee in the formulation and operation of a program, and provides safeguards for all involved.
While the ability to propose a program or amendments to an existing program rests solely with a given percentage of affected growers, there can be no program unless it contains statutory requirements, is processed as required by statute and is approved by the Director. The Director may require a report of all names and addresses of producers from handlers or processers. Further, a public hearing with notice must be held to receive the views of the producers and within 45 days thereof the Director must issue a complete report with all findings and recommendations.
If the Director approves the program, it is put to a referendum. MCL 290.660-290.663; MSA 12.94(30)-12.94(33).
If a program is approved by referendum, the continuing duties of the Director are set forth in MCL 290.664; MSA 12.94(34) as well as the types of provisions that may be covered by a marketing agreement, MCL 290.653; MSA 12.94(23), and the duties of a commodity committee, MCL 290.657; MSA 12.94(27).
All proposed programs must include specified terms including the maximum assessment rate, MCL 290.665; MSA 12.94(35), and monies can be disbursed only for necessary expenses. MCL 290.658; MSA 12.94(28). There is also provision for refund of any money not so expended. MCL 290.659; MSA 12.94(29). At all stages, the Administrative Procedures Act applies, MCL 24.201, et seq.; MSA 3.560(101) et seq.
Such statutory provisions clearly set forth in the Act provide sufficient standards to insure that the persons affected will be protected and that any program resulting therefrom will not be the result of an abdication of authority by the Legislature, but will be in careful compliance with the legislative intent and power.
2. Standards as Reasonably Precise as the Subject Matter Permits.
The Act was drafted to permit utilization by the producers of a number of different agricultural commodities. By necessity, therefore, some flexibility must exist to permit effectuation of this purpose. This was explained by the circuit court in its decision in the instant case:
"It is true that the Act utilizes general terms and not specifics. The subject matter, however, demands such a treatment. Certain commodities subject to periodic surplusage must be rigidly controlled since further market expansion is impossible. Producers of other commodities may choose to solve their marketing problems through penetration into previously untapped areas. New hybrids or technical innovations may cause a radical change in market structures within a brief period of time. The Act must be flexible enough to deal with both the foreseeable and unforeseeable while at the same time defining with reasonable specificity those actions which are permitted in response thereto. Through passage of the Act, the Legislature has expressed its determination that any commodity program which complies with the standards set forth in the statute will effectuate the promotion of the general welfare.”
When viewed in light of the wide range of purposes for which producers may benefit by application of the Act, it is clear that it contains as much specificity as is practical. The Legislature has effectuated its purpose with standards as reasonably precise as the subject matter permits.
3. Act Must Be Construed as Valid if Possible.
In light of the above findings, it is without difficulty that we find the Act valid. The legislatively provided guidelines and standards which are " * * * necessary to minimize the opportunity for abuse of discretion as well as to adequately protect the interests of those affected by the regulations”, Seaman, supra, 313, are present.
The above analysis of specific provisions of the Act demonstrates that the producers must actively participate in all stages of development and effectuation of a marketing program. Further, a system of checks and balances is provided among producers, the Director of the Department of Agriculture and members of the commodity committee to insure not only compliance with the Act, but implementation of an objective marketing program that will meet the needs of those to whom it applies.
Because of our findings in favor of appellees on issues 1 and 2 (see parts III and IV), there is no need to reach issue 3; appellant is neither entitled to a refund of assessments previously paid nor attorneys’ fees.
V. Conclusion
We find that the Act in question authorizes assessments, not taxes, for the purpose of operating a marketing program and does not unconstitutionally delegate legislative authority to producers of commodities.
No costs, a public question being at issue.
Fitzgerald and Blair Moody, Jr., JJ., concurred with Williams, J.
This is exactly the same number of producers which may, at any time, petition the Director for termination of the program. MCL 290.663; MSA 12.94(33).
MCL 290.655; MSA 12.94(25):
"(a) Assessments shall be collected from each producer of any marketable agricultural commodity produced in this state and directly affected by a marketing program issued for the commodity to defray all program and administrative costs except as provided under subsection (i) of section 3.
"(b) Each program shall specify the maximum assessment to be collected to cover program and administrative costs,
"(c) For convenience the processors, distributors or handlers of the commodity may be required to collect and remit producer assessments. Processors, distributors or handlers paying the assessments for any producer may deduct the amount from any moneys which they owe to the producers.
"(d) Each program may specify the date after the production of the commodity when the assessment, whether collected by the producers, processors, distributors, or handlers of the commodity, is due in the account of the program on that production. Producers, processors, distributors, or handlers of the affected commodity shall be given notice of the due date at least 6 months in advance of the due date.”
Part (d) was added by amendment effective December 15, 1974.
The standards applicable to delegation were recently dealt with by six members of this Court in Westervelt v Natural Resources Commission, 402 Mich 412; 263 NW2d 564 (1978), in which we upheld the delegation of rule-making authority to a public agency.
The Williams opinion in Westervelt, signed by Justices Levin and Fitzgerald, set forth a two-pronged "safeguards, including standards” test for delegation, grounded both in constitutional separation of powers (standards) and constitutional due process (safeguards):
"With respect to the separation of powers, the Legislature does not [improperly] 'delegate’ or 'abdicate’ its power to an administrative agency if the challenged legislation contains 'standards * * * as reasonably precise as the subject matter requires or permits’. With respect to due process, the Legislature does not delegate power to an administrative agency in such a manner that the legislation 'becomes an open door’ to favoritism, discrimination, and arbitrary, uncontrolled discretion on the part of administrative agencies if the challenged legislation contains 'standards * * * as reasonably precise as the subject matter requires or permits.’ ” (Citations omitted.) Westervelt, supra, 438.
Justice Ryan concurred in the result in Westervelt but felt that the delegation doctrine is grounded solely in constitutional separation of powers requiring standards, and "the due process question [safeguards] involves a separate and distinct issue * * * ”. Westervelt, supra, 458. Chief Justice Kavanagh and Justice Coleman concurred in Justice Ryan’s view. Justice Blair Moody, Jr., took no part in the decision.
Because of this lack of a clear majority in Westervelt as to the proper method of analysis, we will rely primarily on the method employed in the prior case of Dep’t of Natural Resources v Seaman, 396 Mich 299; 240 NW2d 206 (1976).
In Westervelt, supra, we noted the different forms of delegation, i.e., delegation "to an administrative agency”, “delegation of lawmaking and/or judicial power to private groups or persons * * * and legislative delegation of 'non-judicial’ power to the judiciary”, pp 443-444, fn 21. However, we also noted that such differences in the form of the delegation do not require the adoption of a different method of analyzing the propriety of the delegation.
2 Antieau, Modern Constitutional Law, p 227.
The Secretary of Agriculture was also authorized by the act to investigate the handling, inspection and marketing of tobacco and to establish the standards by which its type, grade, size, condition or other characteristics could be determined. Currin v Wallace, supra, 306 US 6.
The United States Supreme Court recently found there to be no delegation when an issue of relevance to city residents was submitted to a vote by those residents. In issue was a city charter which required ratification by 55% of the voters for a proposed land use change. The Court stated the following:
"A referendum cannot, however, be characterized as a delegation of power. Under our constitutional assumptions, all power derives from the people, who can delegate it to representative instruments which they create. * * * In establishing legislative bodies, the people can reserve to themselves power to deal directly with matters which might otherwise be assigned to the legislature.” (Citations omitted.) Eastlake v Forest City Enterprises, Inc, 426 US 668, 672; 96 S Ct 2358; 49 L Ed 2d 132 (1976).
The Court further stated:
"Courts have frequently held in other contexts that a congressional delegation of power to a regulatory entity must be accompanied by discernible standards, so that the delegatee’s action can be measured for its fidelity to the legislative will. * * * Assuming, arguendo, their relevance to state governmental functions, these cases involved a delegation of power by the legislature to regulatory bodies, which are not directly responsible to the people; this doctrine is inapplicable where, as here, rather than dealing with a delegation of power, we deal with a power reserved by the people to themselves.” (Citations omitted.) Eastlake, supra, 426 US 675.
We do not decide the issue on this precedent but choose to go forth and examine whether proper standards and safeguards exist.
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Ryan, J.
The Michigan Public Service Commission (the Commission or PSC), an administrative agency of the State of Michigan, pursuant to MCL 460.301; MSA 22.101, possesses the authority to regulate the security issuances of certain companies.
On March 11, 1974, appellant Michigan Gas Storage Company (Storage Company) filed an application for disclaimer of jurisdiction or, in the alternative, application under protest for authorization to issue securities with the Commission. Storage Company sought either a determination that the Commission was without authority to regulate its security issuances or, in the event the Commission declined to disclaim jurisdiction, approval of the proposed securities issuance.
Public hearing on the application was held on March 29, 1974. Evidence adduced at the hearing by Storage Company established that it is a corporation organized and existing under the laws of the State of Michigan and is a wholly owned subsidiary of Consumers Power Company.
As authorized by its articles of incorporation, Storage Company is engaged in the purchase and transportation of natural gas in interstate commerce and the sale of such gas at wholesale for resale for ultimate public consumption. Storage Company purchases its natural gas supply from Panhandle Eastern Pipe Line Company and sells it to its sole customer, Consumers Power Company. Consumers Power Company is a public utility which operates in the State of Michigan and sells gas at retail to the public for domestic, commercial and industrial use.
As a natural gas company transporting and selling gas in interstate commerce, the operation of Storage Company was within the jurisdiction of the Federal Power Commission (FPC) under the regulatory powers granted in the Natural Gas Act, 15 USC 717 et seq. At the time this case was initiated, the Federal Power Commission was the regulatory authority under the Federal Power Act. Under 42 USC 7101 et seq., the Department of Energy Organization Act, the functions of the FPC were transferred to the Department of Energy and the Federal Energy Regulatory Commission.
With respect to the securities proposed to be issued in this case, Storage Company had applied neither to the Federal Power Commission, Securities and Exchange Commission or any state regulatory commission for approval prior to the March hearing. The issuance, the borrowing of $7,500,000 in exchange for Storage Company’s unsecured note to refinance a note for the same amount, was scheduled to take place on April 30, 1974, the due date for the expiring note. Storage Company had, however, filed an application with the FPC on February 15, 1974, seeking approval of a requested rate change to cover the increased costs that would be incurred as a result of the terms of the refinancing.
On April 15, 1974, the Commission issued its decision and order denying Storage Company’s request for disclaimer of jurisdiction and authorized the proposed issuance. Storage Company had previously paid, under protest, the applicable security issuance fee of $7,500.
Storage Company’s application for rehearing was denied by the Commission on July 28, 1975.
Leave to appeal was granted by the Court of Appeals. The case was consolidated for hearing and argument with Indiana & Michigan Power Co v Public Service Commission, post, 405 Mich 400; 275 NW2d 450 (1979). In an opinion issued November 22, 1976, the Court of Appeals reversed, holding that the Commission was without jurisdiction to regulate the securities issuances of Storage Company and ordered the refund of the statutory issuance fee. 72 Mich App 384; 249 NW2d 422 (1976).
The Court of Appeals, after reviewing the regulatory structure applicable to Storage Company, concluded that securities regulation under MCL 460.301; MSA 22.101 "is ancillary to the Commission’s general power to control rates, services, and facilities”.
We granted leave to appeal and also consolidated the case for hearing with Indiana & Michigan Power Co, supra, in which leave was also granted. 400 Mich 805 (1977).
The sole issue before the Court is whether the PSC may exercise any regulatory authority over the securities of Storage Company. We hold that it may.
I
We believe some exposition of our understanding of the regulatory framework will assist in setting the issues in perspective. At the outset, we must agree with the Court of Appeals that the record in this case is indeed sparse. As that Court noted, Storage Company, the moving party, bears the burden of producing sufficient evidence on which a conclusion of lack of jurisdiction can be based. The company claimed below that the record was sufficient to decide the jurisdictional issue.
As established at the hearing, it appears that Storage Company’s operations consist of the purchase, transportation, storage and sale of natural gas. The Company’s supply of gas is purchased from an interstate pipe line company. All of that gas is then sold to Consumers Power Company which owns all of the outstanding stock in Storage Company. There is no evidence in the record that Storage Company owns any facilities or significant assets that are located outside the state. Nor is there any evidence whether, or how much, if any, of the gas sold to Consumers is ultimately consumed outside the state.
As a company engaged in the purchase and transportation of natural gas acquired from an interstate pipe line, which gas is sold at wholesale for resale, Storage Company is subject to the provisions of the Federal National Gas Act, supra. Under that act the Federal Power Commission exercised regulatory authority over Storage Company’s rates, services and facilities. The Michigan Public Service Commission does not assert jurisdiction over these aspects of the Company’s activities.
II
The holding of the Court of Appeals, as we read that court’s opinion, was based on its determination that the Legislature intended securities regulation of utility companies to be ancillary to rate regulation and that therefore no jurisdiction would exist for the Commission to regulate the securities of a company whose rates were not also being regulated by the Commission.
Relying on the decision of another panel of the Court of Appeals in Great Lakes Transmission Co v Michigan Public Service Commission, 24 Mich App 77; 180 NW2d 59 (1970), the Court below opined:
"The very standards which the Commission must use in MCL 460.301; MSA 22.101 require the exercise of judgment as to whether use of the capital involved is 'reasonably required for the purposes of such * * * corporation’. * * * These judgments necessarily involve consideration of the propriety of Storage Company’s rates, services, and facilities. As this Court recognized in Great Lakes Transmission Co, supra, the capitalization of a company is integrally related to its rates of return and financial status, and in turn must have a direct bearing on the rates set by the agency in oversight. It would be at cross purposes to the legislative schemes of both this state and the Congress to split the authority over rates and securities issuances.” 72 Mich App 384, 396.
Although the Court’s opinion mentions concern for the effects state securities regulation might have on Federal authority over rates, its holding rests on state law grounds.
We do not agree with the Court of Appeals reading of the legislative intent.
Putting aside for the moment the problems presented by Federal regulation of rates, services and facilities and the impact of the Commerce Clause of the United States Constitution, we see no basis for concluding that the Legislature intended securities to be regulated only where rates were also being regulated.
First, there is no indication in the language of the statute that regulatory jurisdiction over securities issuances was to be invoked only where rates were also being regulated. The Legislature has, in other provisions of statutes dealing with public utilities, referred to other enactments that must apply in order to trigger applicability of a particular section of the law. The most obvious example in the statutory provisions we are concerned with is the section levying the security issuance fee. It recites "[wjhenever any [securities] * * * are authorized to be issued in accordance with any law of this state”, MCL 460.61; MSA 22.11. MCL 460.301; MSA 22.101 makes no similar reference to other activities of the Commission.
Indeed, the plain language of the statute evinces a legislative intent to apply its provisions to the enumerated companies without condition. We are hesitant to read language into the statute which the Legislature, for its own reasons, chose not to use.
Moreover, we are convinced that the regulation of securities of utility companies was intended to serve interests that rate regulation alone might be inadequate to protect.
As the portion of its opinion quoted supra indicates, the Court of Appeals viewed securities regulation as being complementary to rate regulation and concluded that the Legislature would not choose to regulate securities where it did not assert similar authority over rates.
While we agree that securities regulation and the attendant financial structure resulting from it will clearly have an effect on ratemaking just as the issuance of securities without the approval of a regulatory authority would, we are convinced that securities regulation serves valid legislative objectives even where the same authority is not exercising jurisdiction over rates.
In Peninsular Power Co v Secretary of State, 169 Mich 595; 135 NW 656 (1912), we identified one of the goals of securities regulation when we said that the plain purpose of the statute was to protect investors against the evils of overcapitalization. See, also, Hillsdale Light & Fuel Co v Michigan Public Utilities Commission, 220 Mich 101; 189 NW 893 (1922). We think appellee Storage Company is correct in its argument that proper evaluation of a proposed offering of securities will also affirmatively take into account the interests of the customers of the utilities, the ratepayers, as directed by statute. Proper securities regulation serves the interests of the ratepayers in assuring continued service without interruption from utilities and in receiving that service at reasonable rates. For example, physical property of a company within the state, essential to the company’s ultimate service to the public, could be jeopardized by inadequate financing, resulting in a failure in that service. We see no reason to conclude that the Legislature would have intended to forego participation in regulating matters affecting interests with respect to which the state may properly exercise its protective powers because it is not also regulating other aspects of the business.
In sum, we can find nothing in the language of MCL 460.301; MSA 22.101 or in logic to require the conclusion that the Legislature intended the Public Service Commission to limit the exercise of jurisdiction over the issuance of securities to utility companies whose rates it also regulates.
Ill
Storage Company makes an additional argument that, based on the language of MCL 460.301; MSA 22.101, the Commission does not have jurisdiction over its securities. The Company urges that it is not a public utility for state law purposes because the Commission does not exercise jurisdiction over its rates and, more specifically, that it is not "[a] corporation * * * exercising or claiming the right to carry or transport natural gas for public use, directly or indirectly * * *”.
It suffices to say that we agree with the Court of Appeals that the clear import of the language of the statute is to include a company like Storage Company. It is a wholly owned subsidiary of a utility operating within the state and, pursuant to its articles of incorporation, it sells gas only to that company, thereby conducting an integral part of the business of its parent of serving the people of this state.
We hold that Storage Company is within the jurisdiction of the Commission granted by MCL 460.301; MSA 22.101.
IV
It is next suggested that state regulation of securities issues was either not intended to occur where authority over rates and other matters is exercised by a Federal regulatory agency or may not occur because of the concurrent exercise of power by the Federal agency. The Court of Appeals expressed doubts that such regulation would be consistent with the state and congressional legislative schemes.
We must first reject any contention that the Legislature did not intend authority over securities to be exerted where Federal law controls rates. The provisions we are concerned with were passed prior to the Federal Natural Gas Act, supra, which asserted Federal regulatory jurisdiction over natural gas companies engaged in interstate commerce.
Nor do we believe that the Natural Gas Act has occupied the field of securities regulation so as to preempt state action in the area that does not otherwise conflict with Federal law or the Commerce Clause, a problem we will consider infra in Part V.
Some understanding of the genesis of Federal regulatory jurisdiction under the Natural Gas Act is helpful in dealing with the issue of preemption. The United States Supreme Court has described the scope of the act as follows:
"In § 1(b) of the Act, '[t]hree things and three only Congress drew within its own regulatory power, delegated by the Act to its agent, the Federal Power Commission. These were: (1) the transportation of natural gas in interstate commerce; (2) its sale in interstate commerce for resale; and (3) natural gas companies engaged in such transportation or sale.’ Panhandle Eastern Pipe Line Co v Public Service Commission of Indiana, 332 US [507, 516; 68 S Ct 190; 92 L Ed 128 (1947)]. Each of these is an independent grant of jurisdiction * * *. Federal Power Commission v East Ohio Gas Co, 338 US 464 [70 S Ct 266; 94 L Ed 268] (1950).” Federal Power Commission v Louisiana Power & Light Co, 406 US 621; 92 S Ct 1827; 32 L Ed 2d 369 (1972).
Enactment by Congress of legislation establishing Federal regulation of natural gas companies was motivated by the inability of the regulatory powers of the states to reach important aspects of what was becoming a nationally powerful and vital industry. Court decisions had made it clear that the states were generally without power to regulate rates of sales of gas for resale, usually to distributing companies, regardless of the character of ultimate use. Panhandle Eastern Pipe Line Co, supra. In addition, comprehensive and equitable distribution plans for gas transported in interstate commerce are practically beyond the competence of state regulatory agencies. Louisiana Power & Light Co, supra.
The goal of the legislation, then, was to occupy a particular field. "But it was meticulous to take in only territory which this Court had held the states could not reach.” Panhandle Eastern Pipe Line Co, 332 US 507, 519. "Congress meant to create a comprehensive and effective regulatory scheme, complementary in its operation to those of the states and in no manner usurping their authority [citations omitted].” Id., 332 US 507, 520.
In other words, the cases have repeatedly held that in enacting the Natural Gas Act, Congress intended to fill regulatory "gaps” and did not have as an object the removal of state power where it could be properly exercised.
In light of this background, we believe it is quite significant that the Natural Gas Act did not give the Federal Power Commission explicit authority to regulate the securities issuances of natural gas companies. Indeed,
"[b]ills recommended by the [Federal Power] Commission to regulate the issuance of securities by 'natural gas companies’ (as well as other persons seeking funds for the construction, acquisition or operation of any facility for which a certificate of public convenience and necessity is required under the Natural Gas Act) were introduced in 1949 and 1955, but were not reported out of committee [footnote omitted].” 1 Loss, Securities Regulation (2d ed), p 426.
As mentioned, officials of Storage Company testified that no other applications were filed for approval of the security issue with which this case is concerned.
In view of the foregoing, we conclude that Congress did not intend, in enacting the Natural Gas Act, to preempt the states from regulating the securities of companies like Storage Company.
The test for determining whether there is room for both state and Federal regulation in a specific area is not whether the regulatory purposes of each are aimed at similar or different objectives, but rather whether the regulations of both can be enforced without impairing the Federal superintendence of the field. Florida Lime & Avocado Growers, Inc v Paul, 373 US 132; 83 S Ct 1210; 10 L Ed 2d 248 (1963). In general, Federal regulation of a field of commerce should not be deemed preemptive of state regulatory power in the absence of persuasive reasons — either that the nature of the regulated subject matter permits no other conclusion or that the Congress has unmistakably so ordained. Id.
The Federal Power Commission exercised no explicit authority over the issuance of Storage Company’s securities. It did, however, exercise jurisdiction over its rates, service and facilities.
This is not, we are convinced, a situation in which compliance with both regulations is a practical impossibility. The Federal regulatory authority apparently has and is exercising authority over Storage Company’s rates. As we have said before, we have no doubt that the Michigan Public Ser vice Commission’s activities with respect to Storage Company’s securities may have some impact upon its rates, just as application of workers’ compensation laws or permissible state regulation of direct retail sales to consumers by utility companies that make both retail and wholesale sales do. But compliance with both the PSC’s orders and those of the FPC concerning rates was neither impossible nor impractical.
Second, in view of the legislative history of the Federal act and the absence therein of explicit provision for the exercise of authority over securities issuances, we do not find an assertion of congressional authority over Storage Company’s rates to amount to an expression of a design to displace an exercise of the state’s police power that is otherwise properly exercised under the Commerce Clause (Part V, infra). See Head v New Mexico Board of Examiners in Optometry, 374 US 424; 83 S Ct 1759; 10 L Ed 2d 983 (1963); Rice v Santa Fe Elevator Corp, 331 US 218; 67 S Ct 1146; 91 L Ed 1447 (1947).
Indeed, we believe it to be unlikely in the extreme that Congress intended the enactment of rate regulation for companies like Storage Company to be understood to preclude the valid exercise of state authority over securities. The purpose of the Natural Gas Act was to fill gaps in the regulation of utility companies, not to create them. If the state does not regulate this security issuance by Storage Company, no authority would.
Finally, regulation of securities of a company like Storage Company and the protection of investors in it is not a subject demanding exclusive Federal regulation to achieve uniformity vital to national interests, Florida Lime & Avocado Growers, Inc, supra, nor is it a subject by its very nature admitting only of national supervision. Id.
V
The appellant’s final challenge to the Commission’s attempt to regulate the securities of the company is the claim that the Commerce Clause of the United States Constitution forbids it. The Court of Appeals found that state regulation would not violate the Commerce Clause.
At the outset, we must reject appellee’s suggestion that because Storage Company sells natural gas solely in interstate commerce, the state is thereby powerless to regulate any aspect of its activities. It has been held repeatedly that the Commerce Clause, in conferring upon Congress power to regulate commerce, did not wholly withhold from the states the power to regulate matters of local concern with respect to which Congress has not exercised its power, even though the regulation affects interstate commerce. California v Thompson, 313 US 109; 61 S Ct 930; 85 L Ed 1219 (1941); New Mexico Board of Examiners, supra; Southern Pacific Co v Arizona ex rel Sullivan, Attorney General, 325 US 761; 65 S Ct 1515; 89 L Ed 1915 (1945).
A state may not, of course, impede the free flow of interstate commerce by discriminating against it in order to make local products more attractive, or imposing regulations that substantially interfere with the movement of commerce while at the same time affording only slight protection of local interests. Southern Pacific Co, supra. The test, then, is one accomplished by balancing. It is necessary to determine first the nature and extent of the burden which the state regulation imposes and then weigh the state and national interests at stake. Id., People v County Transportation Co, 303 NY 391; 103 NE2d 421 (1952), app dis 343 US 961 (1952); United Airlines, Inc v Illinois Commerce Commission, 32 Ill 2d 516; 207 NE2d 433 (1965); Panhandle Eastern Pipe Line Co, supra.
We are convinced that assertion of regulatory jurisdiction by the Michigan Public Service Commission over the securities of Storage Company does not offend the Commerce Clause.
The statute granting authority over the security issuances of utility companies in no way discriminates against interstate commerce. Cf. Polar Ice Cream & Creamery Co v Andrews, 375 US 361; 84 S Ct 378; 11 L Ed 2d 389 (1964). It applies, on its face, to companies engaged in intrastate commerce as well as those engaged in interstate commerce.
Moreover, we are convinced regulation does nothing to substantially impede the flow of interstate commerce. The cases cited by Storage Company all concern regulation of the rates at which particular interstate sales by utility companies are made.
As we have said above, the state has clear and substantial interests in the regulation of Storage Company’s securities. It has a properly recognizable concern for investors in a utility organized and operating and issuing securities under the laws of this state. In addition, proper state regulation of and control over the securities and debt of Storage Company will further the general interest of the citizenry who are ultimate consumers of gas stored and transported by Storage Company in efficient and reliable service. People v County Transportation Co, supra.
We do not believe the national interests which will be affected by state regulation of Storage Company’s securities outweigh these legitimate concerns of the state. The record contains no evidence that Storage Company has facilities or conducts business in any other state or that any of the gas it sells to its sole customer, Consumers Power Company, is ultimately consumed in any other state. Storage Company has suggested no reason for a need for national uniformity or that any other state would have any but the most remote interest in the securities of Storage Company.
We conclude, therefore, that any national interest in Storage Company’s securities does not, on this record, outweigh the state’s interest.
VI
In sum, we hold that the Michigan Public Service Commission may, under MCL 460.301; MSA 22.101, properly exercise jurisdiction over the securities issuances of Storage Company.
Accordingly, the decision of the Court of Appeals is reversed.
Coleman, C.J., and Kavanagh, Williams, Levin, Fitzgerald, and Blair Moody, Jr., JJ., concurred with Ryan, J.
MCL 460.301; MSA 22.101 provides in relevant part:
"Sec. 1. Any corporation or association except municipal corporations, organized and existing, or which may hereafter be organized or authorized to do business under the laws of this state, or any lessee or trustee thereof, or any person or persons owning, conducting, managing, operating or controlling any plant or equipment within this state used wholly or in part in the business of transmitting messages by telephone or telegraph, producing or furnishing heat, artificial gas, light, water or mechanical power to the public, directly or indirectly, and any railroad, interurban railroad or other common carrier, or any corporation, association, or individual exercising or claiming the right to carry or transport natural gas for public use, directly or indirectly, or petroleum oil by or through pipe line or lines or engaged in the business of piping or transporting natural gas for public use, directly or indirectly, or engaged in the business of purchasing natural gas for distribution may issue stocks, bonds, notes or other evidences of indebtedness payable at periods of more than 12 months after the date thereof, when necessary for the acquisition of property, the construction, completion, extension or improvement of facilities or for the improvement or maintenance of service or for the discharge or lawful refunding of obligations and may issue stock to represent accumulated earnings invested in capital assets and not previously capitalized: Provided, and not otherwise, That there shall have been secured from the Michigan railroad commission an order authorizing such issue and the amount thereof, and stating that in the opinion of the commission the use of the capital or property to be acquired to be secured by the issue of such stock, bonds, notes or other evidences of indebtedness, is reasonably required for the purposes of such person, corporation or association, or that the issue of such stock fairly represents accumulated and undistributed earnings invested in capital assets and not previously capitalized.”
If the Commission has jurisdiction over the issuance of securities, Storage Company is liable for the fee provided in MCL 460.61; MSA 22.11 as follows:
"Sec 11. Whenever any stocks, bonds, notes or other evidences of indebtedness are authorized by the commission to be issued in accordance with any law of this state, the party or parties upon whose application said securities are authorized shall before the issuance or sale of said securities, pay into the treasury of the state of Michigan a sum equal to 1/10 of 1 per cent of the face value of the securities so authorized; the sum so paid not to be less than $50.00 in any case: Provided, That a minimum fee of $5.00 shall be paid by rural telephone companies with respect to the authorization to borrow money: Provided, however, That where the property upon which such stocks, bonds, notes or other securities are authorized to be issued, is located partly within and partly without the state of Michigan, then said fee shall be computed only in such an amount and on such proportion of the entire issue, as the amount of the property of such applicant actually located within the state of Michigan, bears to the total amount of the property upon which such securities are issued.”
The Court of Appeals concluded that under the "Hinshaw Amendment” to the Natural Gas Act, 15 USC 717(c), a provision added to the Natural Gas Act in 1954, the Michigan Public Service Commission could regulate the rates, services and facilities of Storage Company. Under that section of the Natural Gas Act, an exemption from the provisions of the act is granted for companies that receive interstate gas within the state or at its border, provided that all the gas is ultimately consumed within the state and that the rates, services and facilities of those companies are regulated by a state commission. Specifically, that section provides:
"(c) The provisions of this chapter shall not apply to any person engaged in or legally authorized to engage in the transportation in interstate commerce or the sale in interstate commerce for resale, of natural gas received by such person from another person within or at the boundary of a State if all the natural gas so received is ultimately consumed within such State, or to any facilities used by such person for such transportation or sale, provided that the rates and service of such person and facilities be subject to regulation by a State commission. The matters exempted from the provisions of this chapter by this subsection are declared to be matters primarily of local concern and subject to regulation by the several States. A certification from such State commission to the Federal Power Commission that such State commission has regulatory jurisdiction over rates and service of such person and facilities and is exercising such jurisdiction shall constitute conclusive evidence of such regulatory power or jurisdiction.”
The Court of Appeals found Storage Company to be a person engaged in the requisite commerce in gas ultimately consumed within the state that was not, however, being regulated in the enumerated respects by the Public Service Commission. As that Court described the situation, the Commission has acquiesced in regulation by the Federal authority.
In the companion case of Indiana & Michigan Power Co v Public Service Commission, 72 Mich App 398; 249 NW2d 429 (1976), involving a similar issue under a different scheme of Federal regulation, the Court of Appeals made it clear that its holding in both cases was grounded in state law. It said:
"A preemption holding is unnecessary, for we find, as in Michigan Gas Storage Co v Public Service Commission, that the Michigan Legislature intended securities regulation in MCL 460.301; MSA 22.101 to be ancillary to the Commission’s regulatory jurisdiction over rates, services and facilities pursuant to MCL 460.6; MSA 22.13(6).” 72 Mich App 398, 408-409.
For example, securities are to be authorized to be issued when necessary, inter alia, for the construction of facilities or for the maintenance or improvement of service and should not be issued if overcapitalization would result.
In Louisiana Power & Light Co, supra, the Court said:
"This congressional blueprint has guided judicial interpretation of the broad language defining FPC jurisdiction, and
" 'when a dispute arises over whether a given transaction is within the scope of federal or state regulatory authority, we are not inclined to approach the problem negatively, thus raising the possibility that a "no man’s land” will be created. Compare Guss v Utah Labor Relations Board, 353 US 1 [77 S Ct 598; 1 L Ed 2d 601 (1957)]. That is to say, in a borderline case where congressional authority is not explicit we must ask whether state authority can practicably regulate a given area and, if we find that it cannot, then we are impelled to decide that federal authority governs.’ Federal Power Commission v Transcontinental Gas Pipe Line Corp [365 US 1, 19-20; 81 S Ct 435; 5 L Ed 2d 377 (1961)].” | [
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Kavanagh, J.
Four cases were consolidated on appeal in order to resolve a question common to all: should the trial court have granted defendant’s request for jury instructions on lesser included offenses?
Pursuant to People v Ora Jones, 395 Mich 379; 236 NW2d 461 (1975), and People v Chamblis, 395 Mich 408; 236 NW2d 473 (1975), it is clear that a defendant has a right upon request to have the jury instructed on necessarily included offenses. Further, a defendant has a right upon request to jury instructions on those cognate lesser included offenses which are supported by record evidence.
The automatic instruction rule for necessarily lesser included offenses removed the need for the trial judges to review the record in order to determine whether or not there is evidence to support a verdict on the lesser offense. Review of the record for evidentiary support is now in order only when the defense requests that the jury be instructed on a cognate lesser included offense.
We decided Ora Jones and Chamblis on December 18, 1975. The four instant cases involve trials which were commenced and concluded prior to December 18, 1975.
In each case here the prosecutor asks that we limit the application of Ora Jones and Chamblis to trials begun after December 18, 1975. The request is based on the claim that Jones and Chamblis announced new rules of law that should be given prospective effect only. We find that contention without merit. In People v Lovett, 396 Mich 101; 238 NW2d 44 (1976), without discussing the retro-activity issue, we found Jones/Chamblis error and reversed a conviction entered prior to our decision in Jones and Chamblis. See People v Lank Thomas, 399 Mich 826; 249 NW2d 867 (1977); People v Bills, 396 Mich 819; 238 NW2d 803 (1976); People v Dates, 396 Mich 820; 238 NW2d 360 (1976); People v Archie Smith, 396 Mich 825; 238 NW2d 536 (1976); People v Aaron, 396 Mich 843; 239 NW2d 602 (1976); People v Watson, 396 Mich 870 (1976); People v Delvin Jones, 397 Mich 871 (1976).
Moreover, in People v Jenkins, 395 Mich 440; 236 NW2d 503 (1975), a companion case released with Jones and Chamblis, we limited to prospective application our holding that a second-degree murder instruction was to be given sua sponte at every murder trial.
Noteworthy also is that the Court of Appeals, with few exceptions, has applied the lesser instruction rules retroactively in disposing of a large number of pre-Jones/Chamblis appeals. People v Bryant, 80 Mich App 428, 434-435; 264 NW2d 13 (1978).
At this juncture, we believe it is unnecessary to decide whether Jones and Chamblis announced new rules of law. Analysis of traditional considerations for limiting application of new rules convinces us that our decision in the instant cases would be retroactive application of Jones and Chamblis, the same disposition which obviously results from a determination that the already existing law has been merely restated or clarified.
Three factors must be balanced in order to limit the retroactive application of a judicial decision: (1) The purpose of the new rule, (2) general reliance on the old rule and (3) the effect on the administration of justice.
In deciding Ora Jones and Chamblis this Court was concerned with a defendant’s constitutionally guaranteed right to trial by jury. We noted that a trial court’s denial of a proper request for instruction on lesser included offenses exposes a defendant to conviction on a charged offense because the jury may be reluctant to acquit one guilty only of a lesser crime. Conversely, a trial court’s refusal to instruct increases the possibility that one guilty of a lesser crime may be acquitted. Either result is unnecessary. We believe a trial court’s failure to give a properly requested instruction attacks the "very heart of our jury trial system”. People v Hampton, 384 Mich 669, 676; 187 NW2d 404, 406 (1971).
We address the second and third considerations together. Whatever the reliance on those appellate decisions which applied a different rule, we find the impact of a retroactive application of this rule to be relatively insignificant on the administration of justice.
Analysis of records in this Court and the Court of Appeals indicate that those pending cases in which trials were concluded and the appellate process initiated prior to our decision in Jones and Chamblis number less than 12. Therefore, no more than 12 cases could, at the outset, require reversal and retrial as a consequence of our disposition in the instant matter. Further mitigation of any burden on the administration of justice may be effected by remand for resentencing on the lesser included offenses, the prosecutor maintaining the option to retry defendant on the greater offense.
Kamin
Defendant Kamin was arrested December 23, 1974, and charged with breaking and entering of an unoccupied dwelling, MCL 750.110; MSA 28.305. After being taken to the station, Kamin alleges he was told that the charges would be dropped and he would be given a lighter sentence if he would confess. Thereafter, Kamin did sign a statement and arranged for the return of certain stolen property. At trial, defendant moved to suppress the confession as improperly obtained. Following a Walker hearing, this motion was denied by the trial court. Defendant subsequently moved that the jury be charged on lesser included offenses of receiving and concealing stolen property and larceny. This motion was also denied. On March 4, 1975, defendant was found guilty of breaking and entering and was sentenced to 5 to 10 years in prison. On appeal, the Court of Appeals affirmed July 15, 1976.
The evidence presented by the prosecution established a completed breaking and entering, positive identification of defendant as the intruder by a neighbor, and defendant in possession of the stolen goods. Defendant entered a plea of not guilty and did not testify at trial.
Neither receiving and concealing stolen goods nor larceny are necessarily lesser included offenses of breaking and entering. Receiving and concealing, a cognate lesser included offense of breaking and entering, is unsupported by the evidence presented at this trial due to the lack of any proof as to the value of the stolen goods. Proof of value is a necessary element for conviction on that charge.
Larceny, a cognate lesser included offense of breaking and entering, is also unsupported by the evidence presented at defendant Kamin’s trial, for the same reason that there is an absence of proof on the necessary element of value of the goods stolen.
We therefore affirm defendant’s conviction.
Austin
Defendant Austin was charged with the unlawful delivery of heroin on June 20, 1973, in violation of MCL 335.341; MSA 18.1070(41). The complaint against him, however, was not filed until September 17, 1973. Defendant alleges, inter alia, that a res gestae witness necessary to his defense, "Marie”, was not indorsed and produced by the people. He also claims the trial court erred in refusing to instruct the jury on the charge of unlawful possession of a controlled substance. On June 7, 1974, defendant was convicted and sentenced to 7 to 20 years in prison. The Court of Appeals affirmed February 6,1976.
At trial, an undercover police officer, the prosecutor’s chief witness, testified that he purchased heroin from the defendant in the presence of several other people including Larry Mills, Rose Spurlock, and another woman, Marie. Another police officer corroborated the undercover officer’s testimony in part because he had the chief prosecution witness under surveillance and was therefore able to place him in the location of the drug transfer on the evening in question. Larry Mills, a long-time friend of defendant Austin, confessed on the stand, testifying that Marie sold the heroin to him and the undercover officer and that defendant Austin was not present at the time. The defendant did not take the stand at trial.
Our case law makes it clear that possession of a controlled substance may, though need not, be a lesser included offense of unlawful delivery. People v Syed, 394 Mich 105; 229 NW2d 1 (1975); People v Martin, 398 Mich 303; 247 NW2d 303 (1976). In People v Stewart (On Rehearing), 400 Mich 540; 256 NW2d 31 (1977), this Court stated:
"In a given case, sale may be found without posses sion. Likewise, possession may be determined without sale.* * *” 400 Mich 540, 548.
In the instant matter, defendant was in possession of the controlled substance according to the state’s evidence, and therefore the trial court’s refusal to deliver the requested instruction on possession was reversible error.
We reverse defendant’s conviction and remand to the trial court for entry of a judgment of conviction of possession of a controlled substance and resentencing, with an option afforded the prosecutor to retry defendant on the original charge of delivery of a controlled substance.
Harrison
Defendant Harrison was charged with the unlawful delivery of opium on August 23, 1974, in violation of MCL 335.341; MSA 18.1070(41). At the conclusion of testimony, defendant requested the jury be instructed on attempted delivery of a controlled substance, and possession of a controlled substance. These instructions were refused by the trial court. Thereafter, defendant was convicted and sentenced to 2 to 20 years in prison. On appeal, the Court of Appeals reversed September 8, 1976, for failure to give the requested instructions.
Testimony during the course of trial established that a drug addict, Lilia Churchill, acting as a police agent, arranged for a sale of opium from a person named "Cameron” to take place in the presence of police officers in a parking lot. Instead of "Cameron”, the defendant Harrison appeared with opium and transacted the sale with an undercover police agent accompanied by agent Lilia Churchill. Once the transaction was completed and the money counted, other officers arrived and arrested Harrison. Defendant’s rendition of the circumstances surrounding the delivery differed. Harrison testified that he happened to be present at Cameron’s place when Lilia Churchill, advised that Cameron was unable to procure a ride in order to meet her, arranged for Harrison to deliver the opium to her. Defendant testified that he realized no profit on this transaction and had never before been involved with Cameron in the sale or delivery of drugs. At the end of trial defense counsel requested that the trial judge instruct the jury on the lesser included offenses of attempted delivery and possession.
We find no error in the trial judge’s failure to instruct the jury on attempted delivery because the statutory definition of delivery under the Controlled Substances Act, MCL 335.304; MSA 18.1070(4) includes "the actual, constructive or attempted transfer from 1 person to another of a controlled substance”. (Emphasis added.) In this situation Michigan’s general attempt statute, MCL 750.92; MSA 28.287, is inapplicable because it is superseded by the specific coverage of attempt by the definitional language in the Controlled Substances Act, MCL 335.304; MSA 18.1070(4).
The trial court should have instructed the jury following defendant’s request on the cognate lesser included offense of possession.
The evidence introduced by both the state and the defendant showed defendant in possession of the controlled substance. We reverse defendant’s conviction and remand to the trial court for entry of a judgment of conviction of possession of a controlled substance and resentencing, with the option granted the prosecutor to retry defendant on the original charge of delivery.
Cargill
Defendant Cargill was charged with the armed robbery of a grocery store in violation of MCL 750.529; MSA 28.797. At the conclusion of testimony, defendant requested the jury be charged on lesser included offenses. This request was denied by the trial court. Thereafter, defendant was convicted and sentenced to 5 to 15 years in prison. On appeal, the Court of Appeals affirmed February 18, 1975. Defendant moved for a new trial in circuit court, which was denied.
The proofs taken at trial established that two men entered a grocery store at closing time and at gunpoint took approximately $750. There were three witnesses. Each witness was shown a number of photographs and each identified the defendant. At trial, defense counsel objected to introduction of the identification evidence on the basis that it showed that defendant may have had a prior criminal record. The trial court overruled the objection pursuant to the prosecutor’s response that the objection was untimely. On appeal, the defense asserts that the identification procedures were suggestive.
Defendant, testifying on his own behalf, presented an alibi defense which was corroborated by his girlfriend. At the close of trial defense counsel requested instructions on the lesser offenses of robbery unarmed, assault with intent to commit robbery while armed, attempt to commit robbery unarmed, larceny from the person, and assault and battery. The trial judge denied the requests because there was no evidence on the record to support conviction on the lesser offenses.
The trial judge erred in refusing to honor defense counsel’s request for instructions on robbery unarmed, assault with intent to commit robbery while armed, and attempt to commit robbery unarmed. They are necessarily lesser included offenses of armed robbery, the crime with which defendant was charged. It was also error to refuse instruction on the lesser cognate offense of larceny from the person.
Assault and battery need not have been instructed upon in the instant matter under the policy we announced in Chamblis, supra, 429. Because it is a misdemeanor punishable by less than one year and the charged offense of armed robbery is a felony punishable by more than two years it was not error for the trial court to have refused instruction on the charge.
We reverse defendant’s conviction and remand to the trial court for entry of a judgment of conviction of attempt to commit robbery unarmed and resentencing, with an option afforded the prosecutor to retry defendant on the original charge of armed robbery.
Upon request, the following issues were heard in the respective cases:
Kamin: Did the trial judge improperly deny defendant’s motion to suppress a signed confession which defendant claims was induced with a promise of leniency?
Austin: I. Did the trial judge err in denying defendant’s pretrial motion to quash the information due to an 89-day delay between the alleged commission of the crime and the day of his arrest?
II. Did the trial court err in denying defendant’s motion to indorse an uncharged accomplice?
III. Did the trial judge abuse his discretion when he denied defendant’s request for continuance following the indorsement of two res gestae witnesses on the first day of trial?
Cargill: I. Defendant argues for the first time on appeal that the prosecutor improperly cross-examined one of the alibi witnesses and made prejudicial comments concerning the defendant during his closing argument.
II. Defendant, also for the first time on appeal, alleges that the pretrial photo identification procedures were impermissibly suggestive.
We have carefully considered the briefs and arguments on these issues and are satisfied that there was no reversible error in connection with them.
Williams, Levin, and Fitzgerald, JJ., concurred with Kavanagh, J.
Blair Moody, Jr., J.
(against retroactive application). We granted leave to appeal and consolidated the following four cases: People v Kamin, 399 Mich 869 (1977); People v Austin, 399 Mich 869 (1977); People v Harrison, 399 Mich 870 (1977); People v Cargill, 399 Mich 870 (1977).
Each of these cases involves the failure of a trial judge to give a requested jury instruction on lesser included offenses. The common issue presented is whether the decision of this Court in People v Ora Jones, 395 Mich 379; 236 NW2d 461 (1975), which was decided on December 18, 1975, and involved jury instructions for lesser included offenses, should be given retroactive effect to trials commenced and completed prior to December 18, 1975.
Facts
Kamin
Defendant Kamin was arrested on December 23, 1974, and charged with breaking and entering an unoccupied dwelling, MCL 750.110; MSA 28.305. Defendant alleges that after he was taken to the police station he was promised that the charges would be dropped or he would receive a lighter sentence if he confessed. Defendant then signed a statement and arranged for the return of certain stolen property.
Prior to trial, at a Walker hearing, defendant moved for suppression of the confession as improperly obtained. The motion was denied by the trial court. At trial, defendant moved that the jury be charged on the lesser included offenses of receiving and concealing stolen property and larceny. This motion was also denied. On March 4, 1975, defendant was found guilty of breaking and entering and was sentenced to five to ten years in prison. The Court of Appeals affirmed defendant’s conviction on July 15, 1976.
Austin
On September 17, 1973, a warrant was issued and defendant Austin was arrested and charged with the unlawful delivery of heroin in violation of MCL 335.341; MSA 18.1070(41). Since the alleged date of the heroin delivery was June 20, 1973, and the warrant did not issue until September 17, defendant alleges he was denied due process because of the undue delay. Additionally, defendant claims that a res gestae witness necessary to his defense was not indorsed and produced by the people. At his trial, defendant requested the jury be instructed on the charge of unlawful possession of a controlled substance. Defendant’s request was denied, and on June 7, 1974, defendant was convicted of delivery of heroin. He was sentenced to 7 to 20 years in prison. The Court of Appeals affirmed on February 6, 1976.
Harrison
Defendant Harrison was charged with the un lawful delivery of opium on August 23, 1974, in violation of MCL 335.341; MSA 18.1070(41). At trial, defendant requested the trial court to instruct the jury on the lesser included offenses of attempted delivery of a controlled substance and possession of a controlled substance. The trial court refused the requests. On December 13, 1974, defendant was found guilty of the offense of delivery of a controlled substance. He was sentenced to 2 to 20 years in prison. On September 8, 1976, the Court of Appeals reversed defendant’s conviction because the trial court failed to give the requested instructions. 71 Mich App 226; 247 NW2d 360 (1976).
Cargill
Defendant Cargill was arrested and charged with armed robbery, MCL 750.529; MSA 28.797. Defendant was identified by the three witnesses to the armed robbery after each was shown a number of photographs by the police. No objection was made by defense counsel to the identification procedures prior to trial. At trial, when defendant objected to the introduction of identification evidence as unduly suggestive, the objection was overruled as being untimely. At the close of trial, defendant moved that the jury be instructed on the lesser offenses of robbery unarmed, assault with intent to commit robbery while armed, attempt to commit robbery unarmed, larceny from the person, and assault and battery. The motion was denied. Defendant was convicted of armed robbery on October 16, 1973, and sentenced to 5 to 15 years in prison. The Court of Appeals affirmed on February 18, 1975.
Discussion
The question presented, whether a new rule of law should be given retroactive or prospective application, is one which has beset this Court and others for years. The general rule as enunciated by the United States Supreme Court in Linkletter v Walker, 381 US 618, 629; 85 S Ct 1731; 14 L Ed 2d 601 (1965), is as follows:
"[W]e are neither required to apply, nor prohibited from applying, a decision retrospectively, we must * * * weigh the merits and demerits in each case by looking to the prior history of the rule in question, its purpose and effect, and whether retrospective operation will further or retard its operation.”
The essence of the Linkletter position was adopted by this Court in People v Hampton, 384 Mich 669; 187 NW2d 404 (1971).
Although Linkletter involved the question of retroactive application of a constitutional principle of law, it does give us some guidance in determining whether in a statutory or procedural context a new rule of law should apply retroactively or prospectively only. The Linkletter Court delineated three key factors to be taken into account: (1) the purpose of the new rule; (2) general reliance on the old rule; and (3) the effect on the administration of justice. Linkletter, supra, 629-640; Hampton, supra, 674.
In examining the purpose of the new rule announced in Ora Jones, it is essential to look at the state of the law prior to that decision. As this Court noted in Ora Jones, prior Michigan law on lesser included offenses "has not been clear or consistent”. Ora Jones, supra, 386. Within this confusing tableau, one of the better expositions of Michigan law was found in People v Stevens, 9 Mich App 531, 533-534; 157 NW2d 495 (1968) lv den 381 Mich 769 (1968):
"Where a request has been made to charge on a lesser included offense, the duty of the trial judge is determined by the evidence.
"If evidence has been presented to support a conviction of the lesser offense, the requested instructions must be given; failure to do so would constitute error. If, on the other hand, no evidence has been presented to support a conviction of the lesser offense, then the requested instruction should be refused.” (Emphasis added.) (Citations omitted.)
The effect of this so-called "no evidence” rule was to vest a high degree of discretion in the trial judge. Because reasonable minds could differ as to whether there was evidence on the record to support conviction on a lesser offense, abuse of discretion and uncertainty of the law often led to reversal on appeal.
This Court in Ora Jones made a sweeping change in the rule regarding lesser included offenses. Lesser included offenses were divided into two categories, those "necessarily included” and "cognate” lesser offenses. The Court said:
"If the lesser offense is one that is necessarily included within the greater,' the evidence will always support the lesser if it supports the greater.
"In the area of 'cognate’ lesser offenses, the evidence in each case adduced at the particular trial must be examined to determine whether that evidence would support a conviction of the lesser offense.” Ora Jones, supra, 390.
This was a dramatic change in procedure as an entire area of the lesser included offense theory was removed from the discretion of the trial court.
Because we view the purpose of the rule announced in Ora Jones as a fundamental change in the law regarding lesser included offenses, we are compelled to conclude that such a rule should be applied prospectively. Ora Jones did not so much reflect on the fundamental fairness of the trial process as it removed an element of discretion from the trial court and gave an additional fact finding alternative to the jury as a part of their mercy-dispensing powers.
Our holding in this case is further buttressed when the other elements of the Linkletter test are taken into consideration. There is little doubt that trial courts relied on the former statement of the law. This is graphically illustrated by an earlier decision of this Court, People v Rich, 397 Mich 399; 245 NW2d 24 (1976). In Rich, this Court refused retroactive application of a jury instruction on the defense of intoxication and specific intent because of the marked effect on the administration of justice in view of the profound reliance on the old rule. Justice Fitzgerald, speaking for a unanimous Court, stated succinctly:
"It makes no sense at all to hold trial courts to instructional standards that could not have been anticipated.”
* * *
"[I]f trial courts are to be effectively guided by our appellate pronouncements, a rational dependence on our decisions currently in effect must be encouraged.” Rich, supra, 404-405.
Further, it would be questionable to conclude that the impact on the administration of justice, by giving retroactive effect to Ora Jones, would be limited to 12 cases in the appellate pipeline. If our decision were to give retroactive effect, there is little doubt that creative counsel for the defense would find methods to bring cases tried long before December 18, 1975, into the appellate process.
For these reasons we hold that this Court’s decision in Ora Jones applies prospectively to cases tried and convictions rendered after December 18, 1975.
Application
Our discussion cannot end here.. We must decide, based on the law in effect at the time, whether the trial courts in the consolidated cases abused their discretion in failing to give the instructions on lesser included offenses.
In Kamin, defendant was charged with breaking and entering but sought instructions on receiving and concealing stolen goods and larceny. The evidence adduced at trial showed a completed breaking and entering, positive identification of defendant as the intruder, and defendant in possession of the stolen goods. No evidence was presented as to the value of the goods stolen. Since an essential element of a conviction for both receiving and concealing stolen goods and larceny is proof as to the value of the stolen goods, the trial court did not err in failing to give the requested instructions.
We, therefore, affirm defendant Kamin’s conviction.
In Austin, defendant was charged with unlawful delivery of heroin but sought an instruction on possession of a controlled substance. Our review of the evidence clearly shows that the trial court abused its discretion by failing to instruct on the lesser included offense of possession, as some evidence supported that lesser offense.
We, therefore, reverse defendant Austin’s conviction and remand to the trial court for entry of a judgment of conviction of possession of a controlled substance and resentencing, with an option afforded the prosecutor to retry defendant on the original charge of delivery of a controlled substance.
In Harrison, defendant was charged with unlawful delivery of a controlled substance. Defendant requested the trial court instruct on the charges of attempted delivery of a controlled substance and possession of a controlled substance.
We find no error in the trial court’s failure to instruct on attempted delivery. The Michigan Controlled Substances Act includes in its definition of delivery, "the actual, constructive or attempted transfer from 1 person to another of a controlled substance”. MCL 335.304; MSA 18.1070(4). (Emphasis added.) Because the Controlled Substances Act has specifically included attempt in its definition of delivery, Michigan’s general attempt statute, MCL 750.92; MSA 28.287, does not apply.
However, our review does show evidence on the record to support a charge of unlawful possession of a controlled substance.
We, therefore, affirm the Court of Appeals decision insofar as it is consistent with this opinion. We reverse defendant Harrison’s conviction and remand to the trial court for. entry of a judgment of conviction of possession of a controlled substance and resentencing, with the option granted the prosecutor to retry defendant on the original charge of delivery.
In Cargill, defendant was charged with armed robbery but sought to have the jury instructed on the lesser included offenses of robbery unarmed, assault with intent to commit robbery while armed, attempt to commit robbery unarmed, larceny from the person, and assault and battery. In light of the state of the law pre-Ora Jones, our review shows evidence to support charges on at least two of the lesser included offenses, namely, assault with intent to commit robbery while armed and larceny from the person.
We reverse defendant Cargill’s conviction and remand to the trial court for entry of a judgment of conviction of larceny from the person and resentencing, with an option afforded the prosecutor to retry defendant on the original charge of armed robbery.
Further, we have reviewed all the other issues raised by defendants in these consolidated cases and we find them without merit.
Conclusion
In summary, we conclude that the decision of this court in People v Ora Jones, applies prospectively only. Applying the law extant prior to Ora Jones: we affirm the Court of Appeals decision in People v Kamin; we affirm the Court of Appeals decision in People v Harrison insofar as it is consistent with this opinion and remand to the trial court for action pursuant to our decision today; we reverse the Court of Appeals decision in People v Austin and People v Cargill and remand to the trial courts for action pursuant to our decision today.
Coleman, C.J., concurred with Blair Moody, Jr., J.
Ryan, J.
I agree with my brother Moody’s conclusion that People v Ora Jones, 395 Mich 379; 236 NW2d 461 (1975), marked a fundamental change in the law regarding lesser included offenses and that the rule of Ora Jones should be applied prospectively to cases tried and convictions rendered after December 18, 1975.
I write separately because I disagree with his interpretation and application of the so-called "no evidence” rule. Under the standards of the "no evidence” rule, effective at the date of the trials at issue herein, the trial judges did not abuse their discretion in failing to give the requested instructions on lesser included offenses.
The "no evidence” standard is well articulated in Sansone v United States, 380 US 343, 349-350; 85 S Ct 1004; 13 L Ed 2d 882 (1965):
" 'In a case where some of the elements of the crime charged themselves constitute a lesser crime, the defendant, if the evidence justified] it * * * [is] entitled to an instruction which would permit a finding of guilt of the lesser offense.’ Berra v United States, supra, [351 US 131] 134. See Stevenson v United States, 162 US 313; 16 S Ct 839; 40 L Ed 980. But a lesser-offense charge is not proper where, on the evidence presented, the factual issues to be resolved by the jury are the same as to both the lesser and greater offenses. Berra v United States; supra; Sparf v United States, 156 US 51, 63-64; 15 S Ct 273; 39 L Ed 343. In other words, the lesser offense must be included within but not? on the facts of the case, be completely, encompassed by the greater. A lesser-included offense instruction is only proper where the charged greater offense requires the jury to find a disputed factual element which is not required for conviction of the lesser-included offense. Berra v United States, supra; Sparf v United States, supra, at 63-64.” (Emphasis supplied.)
Then Judge, now Justice, Levin elucidated the implications of this rule in People v Gregory Thomas, 38 Mich App 777, 779, 782-783; 197 NW2d 97 (1972):
"The rule is that entitlement to a charge on a lesser included offense largely turns on whether, on view of the evidence favorable to the defendant, there is evidence which would justify the jury in concluding that the greater offense was not committed and a lesser included offense was committed.
"Implicit in the long-established rule, recently reiterated by the Michigan Supreme Court, that it is not error to refuse to charge on a lesser offense which is not supported by the evidence, is the Court’s rejection of the contention advanced by Thomas that MCL 768.32; MSA 28.1055 entitles every defendant in every case to a charge on 'an attempt to commit such offense’ either because the statute so states or because 'every completed offense must include a successful attempt to commit the crime’ or because a jury may believe such portion of a witness’s testimony as it chooses to believe and discard the balance. It is obvious, in the light of the present case law concerning entitlement to a charge on lesser offenses, that Thomas’s argument has not prevailed in the councils of the Supreme Court.”
Applying the above principles to the cases con solidated on appeal, I conclude that in each instance the trial court properly exercised its discretion in refusing to instruct on the requested lesser included offenses.
In Kamin defendant was charged with breaking and entering of an unoccupied dwelling, MCL 750.110; MSA 28.305. The evidence adduced at trial showed a completed breaking and entering, positive identification of the defendant as the intruder, and defendant in possession of the stolen goods. No evidence was presented with respect to the value of the stolen goods. The defendant moved that the jury be instructed on receiving and concealing stolen goods and larceny. Defendant contends that the trial judge abused his discretion in failing to give the requested instructions.
An essential element of a conviction for receiving and concealing stolen goods, as well as for larceny, is proof as to the value of the stolen goods. Since the evidence adduced at trial would not support a conviction for either of the above offenses, the trial court was correct in refusing to give the requested instructions.
I therefore would affirm defendant’s conviction.
In Austin defendant was charged with unlawful delivery of heroin but sought an instruction on possession of a controlled substance.
At trial, an undercover police officer, the chief witness for the prosecutor, testified that he purchased heroin from the defendant in the presence of several other people. Another police officer corroborated the undercover officer’s testimony in part because he had the officer under surveillance and was therefore able to place him in the location of the drug transfer on the evening in question. Austin’s defense was predicated upon the testimony of Larry Mills. Mr. Mills, a longtime friend of defendant Austin, testified that a woman by the name of Marie sold the heroin to him and the undercover officer and that defendant Austin was not present at the time. Defendant did not take the stand.
The sole factual dispute centered about whether or not the defendant was at the scene of the delivery. The undercover officer’s credibility, or the reliability of his identification, applies with equal force to the officer’s testimony that defendant first possessed the heroin and to the testimony that he subsequently delivered it. The rule is clear that lesser included offense instructions are "not proper where, on the evidence presented, the factual issues to be resolved by the jury are the same as to both the lesser and greater offenses”. Sansone v United States, supra. The instant factual situation falls squarely within this rule. There was no evidence which would justify the jury in concluding that the greater offense of delivery was not committed and a lesser offense of possession was committed. Accordingly, the trial court did not err in failing to give the requested instruction. I would, therefore, affirm Austin’s conviction.
In Harrison defendant was charged with the unlawful delivery of opium. Testimony during the course of trial established that a drug addict, Lilia Churchill, acting as a police agent, arranged for a sale of opium from one Cameron. The sale was to take place in the presence of undercover officers in a specified parking lot. Instead of Cameron, the defendant Harrison appeared with the opium and transacted the sale with an undercover police agent who had accompanied Churchill. After the transaction was completed and the money counted, other officers arrived and arrested Harrison. In his defense, Harrison took the stand and testified that he happened to be present at Cameron’s place when Lilia Churchill called on the telephone. According to Harrison’s testimony, Churchill asked him and a companion of his if they would deliver the opium to her because Cameron was unable to procure a ride. Harrison acknowledged that he did make the delivery but emphasized that he realized no profit on the transaction and had never before been involved with Cameron in the sale or delivery of drugs. At the end of trial, defense counsel unsuccessfully requested that the trial judge instruct the jury on the lesser included offenses of attempted delivery and possession.
The statutory definition of delivery under the Controlled Substances Act, MCL 335.304; MSA 18.1070(4), includes "the actual, constructive, or attempted transfer from 1 person to another of a controlled substance”. The specific language of the Controlled Substances Act covering attempted deliveries supersedes and thus renders inapplicable Michigan’s general attempt statute, MCL 750.92; MSA 28.287. Accordingly, the trial court was correct in refusing to instruct on attempted delivery.
With respect to the defendant’s requested instruction on possession, there was no evidence on the record which would justify the jury in concluding that the greater offense, delivery, was not committed while the lesser offense, possession, was committed. There was no dispute in the testimony as to whether defendant merely possessed opium or whether he sold it. Although defendant testified to a mitigating factual circumstance which would possibly lessen his culpability, he never contended that he did not actually deliver or intend to deliver the opium to the police agent. On this factual predicate the trial court did not abuse its discretion in failing to give the requested instruction on possession of a controlled substance.
The Court of Appeals, applying the rule of Ora Jones, reversed appellant’s conviction. I would reverse the decision of the Court of Appeals and affirm defendant Harrison’s conviction.
In Cargill defendant was charged with the armed robbery of a grocery store in violation of MCL 750.529; MSA 28.797. The evidence introduced at trial established that two men entered a grocery store and at gunpoint took approximately $750. Defendant was identified by the three witnesses to the armed robbery after each was shown a number of photographs by the police. Testifying on his own behalf, defendant presented an alibi defense which was corroborated by his girlfriend. At the close of trial, defense counsel requested instructions on the lesser included offenses of robbery unarmed, assault with intent to commit robbery while armed, attempt to commit robbery unarmed, larceny from the person, and assault and battery. The trial court denied the requests.
A review of the lower court record supports the trial judge’s decision. Evidence presented at trial was conclusive of the completed offense of robbery armed. The undisputed evidence established that the men who took the money were armed with a sawed-off shotgun and that the taking was with force or threat of violence. The defense was alibi. The only question for the jury to pass upon was whether the defendant was one of the men present and participating in the commission of the crime. This factual issue was the same as to both the lesser and greater offenses.
Accordingly, there is no evidence which would justify the jury in concluding that the greater offense was not committed and the lesser included offenses were committed. Therefore, I find no error in the trial court’s failure to instruct on the requested lesser included offenses, and would affirm Cargill’s conviction.
There is one exception to the "request” requirement in the case of first-degree murder. The judge is bound, without regard to a defense request, to instruct the jury on second-degree murder. People v Jenkins, 395 Mich 440; 236 NW2d 503 (1975).
This approach was recommended by B. J. George in Lesser Included Offenses in Michigan, 1975 DCL Rev 35, 40.
Justice Swainson, writing for the Court in Hampton, said:
"[T]his Court is under no constitutional compulsion to apply the * * * [new] rule, either prospectively or retrospectively.” Hampton, supra, 674.
For a full discussion of Michigan law on lesser included offenses prior to this Court’s decision in Ora Jones, see Koenig, The Many-Headed Hydra of Lesser Included Offenses: A Herculean Task for the Michigan Courts, 1975 DCL Rev 41.
See George, Lesser Included Offenses in Michigan, 1975 DCL Rev 35, 38. It is the author’s contention that when a trial court errs in failing to give an instruction on a lesser included offense, the error should be viewed as an abuse of discretion rather than an impairment of the right to jury trial.
For a further discussion of what the authors view as the radical change in Michigan law regarding lesser included offenses, see Atkinson, 1977 Annual Survey of Michigan Law: Criminal Law, 24 Wayne L Rev 421, 428-430 (1978); Corrigan & Grano, 1976 Annual Survey of Michigan Law: Criminal Law, 23 Wayne L Rev 473, 494-504 (1977). | [
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Levin, J.
Tracey-Ann Foxworth, then 14, was burned when a jug of wood alcohol exploded during a physical science class in a public school.
Her mother, Annie M. Bush, individually and as next friend, commenced this action against Oscoda Area Schools, its superintendent, the principal and the classroom teacher. The circuit judge granted defendants’ motion for summary judgment on the ground that the complaint failed to state a claim upon which relief could be granted. The Court of Appeals affirmed as to the school district and the superintendent and reversed as to the principal and teacher.
We conclude that the complaint states claims as to all defendants, and remand for trial.
I
Foxworth attended Oscoda High School and was enrolled in Introductory Physical Science. The class had been conducted in the chemistry laboratory, but due to increased enrollment was rescheduled to meet in a non-laboratory room. The chemistry laboratory was equipped with a safety shower, ventilation or exhaust hoods, sinks, enclosed storage areas, stationary laboratory desks and water and gas outlets. The substitute room was not so equipped.
The classroom teacher had complained to the school principal about the substitute room: She said "[y]ou cannot keep sending us this many students and expect us to do lab work in rooms this size where the tables move too easily. It’s just too crowded”. "When you throw more students in that classroom * * * [y]ou have more hands to get into things, more bodies in the small amount of space, more confusion at times. People sometimes bump into each other. You tend to have more clumsiness occurring and it’s just too hard to manage too many students.”
Introductory Physical Science is the first science course offered the high school students. The course experiments are relatively simple. During the first six to ten weeks the experiments concentrate on measuring. At about the eighth to tenth week the experiments require heat, and burners are used in two experiments. In the chemistry laboratory the students use gas-fired burners which are connected to a permanent installation for the gas supply. In the substitute room portable alcohol burners were used.
The alcohol was stored in the chemistry lab. A practice developed of pouring the alcohol into a plastic jug for transport to the substitute classroom. Before school the classroom teacher poured enough alcohol into the jug for the day’s classes. The alcohol jug and burners were put on the rear counter. The jug had an open top. Students filled their burners at the counter and took them to their desks. The classroom teacher lit the burners at the desks. Goggles were worn during the experiment. After the experiment the students were to extinguish the burners and return them to the counter.
At the time of the accident Foxworth was returning her burner and noticed a lighted burner on the counter. She picked it up and as she attempted to extinguish it an explosion occurred and she caught fire.
Foxworth panicked. Another teacher came into the room. The fire extinguisher, which was kept at the opposite end of the room, was given to the classroom teacher and she put out the fire.
Foxworth suffered second- and third-degree burns.
II
Plaintiffs contend that the school district is not immune from suit because:
i) the governmental tort liability act is unconstitutional, or, alternatively,
ii) the operation of a school is not a "governmental function” within the meaning of that act, and, in any event,
iii) it is liable under the defective building provision of the act because the classroom lacked necessary safety equipment.
Three Justices have indicated in other opinions that a school district is subject to liability for negligence in the operation of a school and would therefore find it unnecessary to decide whether the complaint states a claim within the defective building provision. Because there is no majority to so hold, we must determine whether the complaint states a claim within the defective building provision. We hold that it does.
The defective building provision, in relevant part, reads as follows:
“Governmental agencies have the obligation to repair and maintain public buildings under their control when open for use by members of the public. Governmental agencies are liable for bodily injury and property damage resulting from a dangerous or defective condition of a public building.” MCL 691.1406; MSA 3.996(106).
The school district contends that the provision "impose[s] liability only for those injuries resulting from defective conditions in public buildings caused by inadequate or negligent repairs or maintenance [emphasis in original]”. The duty is only to "repair and maintain”, and unless that duty is breached there can be no liability. Plaintiffs have not alleged a failure to "repair or maintain” the building and have therefore failed to state a cause of action.
In an analogous situation involving defective highways, this Court has rejected similar arguments. Statutes imposed a duty to keep highways "in reasonable repair” and "reasonably safe and fit [or 'convenient’] for travel”. It was unsuccessfully argued that "reasonable repair” qualifies and limits "reasonably safe and fit [convenient] for travel”.
In Joslyn v Detroit, 74 Mich 458, 459, 460; 42 NW 50 (1889), the city claimed that it was not liable "because the injury did not result from a want of repair of the street”, and in Finch v Village of Bangor, 133 Mich 149, 150; 94 NW 738 (1903), the village argued that it was not liable because "want of repair was not the immediate cause of the injury”. This Court construed the statutes as imposing a duty to keep the highway both in "good repair” and in a condition "reasonably safe and fit for travel”.
In Malloy v Walker Twp, 77 Mich 448, 458; 43 NW 1012 (1889), the plaintiff did not claim any failure to repair, but asserted that the township had been negligent in not providing barriers or railings along the side of an embankment. The township asserted that liability could not be imposed "on account of a plan or scheme of construction of a road”. This Court responded:
"A municipality cannot construct a dangerous and unsafe road, — one not safe and convenient for public travel, — and shield itself behind its legislative power to adopt a plan and method of building and constructing in accordance therewith.” Id., p 462.
The defective building provision is structurally similar to the defective highway provisions. It states a duty, "repair and maintain”, and in providing a cause of action extends it to "a dangerous or defective condition of a building”. We construe the defective building provision as we have the defective highway provision. Governmental agencies are subject to liability for a dangerous or defective condition of a public building without regard to whether it arises out of a failure to repair and maintain.
As in the highway cases, a building may be dangerous or defective because of improper design, faulty construction or the absence of safety devices.
Plaintiff has alleged that the improper design of the classroom and absence of safety devices ren dered it unsafe as a science classroom, and the classroom was therefore dangerous and defective and a cause of Foxworth’s injuries.
Ill
Two judges of the Court of Appeals said that "as to particular uses or activities for which a public building, or a part thereof, is specifically assigned, failure to provide the usual building components and safety devices appropriate to such contemplated use would be actionable under the statute”, but affirmed the summary judgment because "the complaint alleges a course of classroom conduct which would be dangerous even in a properly equipped laboratory”. The third judge agreed with affirmance because Foxworth’s "injury did not result from a defective condition of the building but from the use to which the classroom was put”.
We agree with the majority of the Court of Appeals that the question whether a part of a building, in this case a classroom, is dangerous or defective is to be determined in light of the "uses or activities” for which it is "specifically assigned”, in this case a physical science class. As stated in Pichette v Manistique Public Schools, 403 Mich 268, 285; 269 NW2d 143 (1978) (Fitzgerald, J.), "in providing for the three exceptions to the general grant of immunity contained in MCL 691.1407; MSA 3.996(107), the Legislature intended to protect the general public from injury by imposing upon governmental agencies the duty to maintain safe public places, whether such places are public highways or public buildings.” (Emphasis supplied.)
To be sure, the lack of certain safety devices did not render the classroom defective per se; it is ordinarily unnecessary to install laboratory safety equipment in classrooms. In determining whether a place is safe, one must consider the use or purpose it serves. A building may be safe for one use or purpose, but not for another. A school is not a school because it is called one, but because it is used and functions as one. If a hospital is converted into a prison, the building must be maintained as a safe prison, not as a safe hospital. The room in which Foxworth was injured had by use become a physical science room, and therefore had to meet the standards of a physical science room although it had once been a mathematics room.
The trier of fact must determine whether the room was defective when used as a physical science classroom and, if so, whether the defect was a cause of Foxworth’s injuries. Conceding that the alleged "course of classroom conduct * * * would be dangerous even in a properly equipped laboratory”, it is yet possible that if the room were properly equipped the accident would not have occurred or the injuries would have been less severe. The question of the significance of the defect in relation to the alleged injuries is a question of fact.
IV
The school district claimed that increased enrollment necessitated conducting physical science classes in non-laboratory rooms. We recognize that circumstances change and temporary accommodation must be made so that business may continue while adjustments are being made. In such situations it might be reasonable to change temporarily the use of a building or room or in the case of a highway, reroute traffic.
A governmental agency is not subject to liability for a dangerous or defective condition unless it "had actual or constructive knowledge of the defect and, for a reasonable time after acquiring knowledge, failed to remedy the condition or to take action reasonably necessary to protect the public against the condition”. It was thus a question of fact whether the school district, with knowledge of the defect, failed "to take action reasonably necessary to protect” the students. Temporary use of the unconverted room may have been reasonable provided the school district took appropriate action to protect the students until permanent protective measures could be provided.
V
The complaint against the individual defendants was dismissed on the ground that it failed to state a claim upon which relief can be granted, GCR 1963, 117.2(1). The complaint did state claims against the individual defendants.
We reverse and remand for trial.
Kavanagh and Fitzgerald, JJ., concurred with Levin, J.
The motion was brought under GCR 1963, 117.2(1), failure to state a claim upon which relief can be granted. The parties stipulated that the judge could consider depositions in deciding the motion. The depositions are a part of the record on appeal and are the basis of the facts related in Part I.
We do not wish to be understood as indicating that even upon stipulation of the parties a judge may decide disputed factual questions in resolving whether a complaint states a claim upon which relief can be granted. We view the stipulation as permitting consideration of undisputed testimony as an expansion and particularization of allegations of plaintiffs complaint.
Bush v Oscoda Area Schools, 72 Mich App 670, 676; 250 NW2d 759 (1976).
See fn 1, supra.
MCL 691.1401 et seq.; MSA 3.996(101) et seq.
MCL 691.1406; MSA 3.996(106).
I would hold on equal protection grounds that a school district is subject to the same liability as a private school. See Thomas v Dep’t of State Highways, 398 Mich 1, 14; 247 NW2d 530 (1976). Justice Kavanagh and Justice Fitzgerald have said in an opinion which I signed that the operation of a school is not a governmental function. Thomas v Dep’t of State Highways, supra, pp 21-22. See, also, Pichette v Manistique Public Schools, 403 Mich 268; 269 NW2d 143 (1978).
Plaintiffs negligence theory and defective building theory are not equivalents. Plaintiffs negligence theory was that the defendants failed to exercise due care in holding the class in a non-laboratory room, scheduling too many students in the classroom and failing to adequately supervise the class.
Plaintiffs defective building theory is based on lack of safety devices.
The two theories are not equivalents because plaintiff might fail to prove that lack of safety devices, the alleged building defect, was a cause of the injury, and yet, had they been permitted to proceed on the negligence theory, may have been successful in establishing, for example, that the lack of supervision or the size of the class was a cause of the injuries.
"Each governmental agency having jurisdiction over any highway shall maintain the highway in reasonable repair so that it is reasonably safe and convenient for public travel. Any person sustaining bodily injury or damage to his property by reason of failure of any governmental agency to keep any highway under its jurisdiction in reasonable repair, and in condition reasonably safe and fit for travel, may recover the damages suffered by him from such governmental agency.” MCL .691.1402; MSA 3.996(102).
The source of the statute contained almost identical language. It imposed on.townships, villages, cities or corporations "the duty * * * to keep in reasonable repair, so that they shall be reasonably safe and convenient for public travel, all public highways * * *”. (Emphasis supplied.) 1909 PA 283, ch 22, § 3; 1915 CL 4586; 1929 CL 4225; 1948 CL 242.3; 1887 PA 264, § 3; 1897 CL 3443; 1885 PA 214, § 4; 1879 PA 244, §4.
Another section of the act created the cause of action for those injured by reason of a defective highway. It provided:
“Any person or persons sustaining bodily injury upon any of the public highways or streets in this state, by reason of neglect to keep such public highways or streets, and all bridges, sidewalks, crosswalks and culverts on the same in reasonable repair, and in condition reasonably safe and fit for travel by the township, village, city or corporation whose corporate authority extends over such public highway, street, bridge, sidewalk, crosswalk or culvert and whose duty it is to keep the same in reasonable repair, such township, village, city or corporation shall be liable to and shall pay to the person or persons so injured or disabled just damages, to be recovered in an action of trespass on the case before any court of competent jurisdiction.” 1909 PA 283, ch 22, § 1; 1915 CL 4584, § 1; 1929 CL 4223, § 1; 1948 CL 242.1; 1887 PA 264, § 1; 1897 CL 3441, § 1; 1885 PA 214, § 1; 1879 PA 244, § 1 (emphasis supplied).
The comparable statute imposing on counties the duty to keep highways in reasonable repair contains the same language as the repealed city-township statute. The county statute, as does the present defective highway statute, establishes the cause of action within the provision imposing the duty. MCL 224.21; MSA 9.121.
In Joslyn v Detroit, 74 Mich 458, 459; 42 NW 50 (1889), a private citizen had piled sand in the street while building a house. Plaintiff claimed that the city was negligent "in placing and in allowing the said bank to obstruct the street for so long a time, and in not providing suitable warnings to prevent any collision therewith”.
This Court held it to be a jury question whether under the circumstances the street was kept in a reasonably safe condition. Finch v Village of Bangor, 133 Mich 149, 151; 94 NW 738 (1903); see, also, McEvoy v Sault Ste Marie, 136 Mich 172; 98 NW 1006 (1904); Jablonski v Bay City, 248 Mich 306; 226 NW 865 (1929); Kowalczyk v Bailey, 379 Mich 568; 153 NW2d 660 (1967); Peters v Dep’t of State Highways, 400 Mich 50; 252 NW2d 799 (1977); Mullins v Wayne County, 16 Mich App 365; 168 NW2d 246 (1969).
See, also, Carver v Detroit & Saline Plank Road Co, 61 Mich 584, 590; 28 NW 721 (1886).
Bush v Oscoda Area Schools, supra, p 699 (Peterson, J.).
Id., p 700.
Id., p 675 (Kelly, J.).
MCL 691.1406; MSA 3.996(106).
Similarly, in the highway situation, when there is a temporary detour during construction, it is within the duty to keep highways safe for public travel that the city "must take into account the natural inclination of children to run about in play and the perverse insistence of adults to cut corners and cross streets and grass plats instead of following precisely the beaten or provided path”. Jablonski v Bay City, supra, p 310. | [
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Per Curiam.
When the trial judge was asked to exclude defendant’s prior conviction, in each case he concluded that the similarity of the prior offense and the one for which the defendant was standing trial was a factor to be weighed in favor of allowing impeachment by the previous conviction. We hold that the trial judge misapplied the guidelines we set forth in People v Jackson, 391 Mich 323; 217 NW2d 22 (1974), and reverse.
I
Preston Baldwin was charged with assault with intent to commit murder and convicted by a jury of assault with intent to do great bodily harm less than murder in November of 1974. The defendant admitted stabbing the victim, but claimed he acted in self-defense. Before testifying, he asked the trial judge to exclude evidence of his prior convictions of felonious assault and attempted armed robbery. The trial judge observed that both of the prior convictions were assaultive in nature, like the charged offense, and under Luck v United States, 121 US App DC 151; 348 F2d 763 (1965), the similarity of conduct was a factor weighing in favor of admitting the previous crimes. The Court of Appeals affirmed the defendant’s conviction in an opinion that did not discuss his impeachment by prior convictions. 74 Mich App 700; 254 NW2d 619 (1977).
Winston Woolfolk was charged with and convicted by a jury of armed robbery in 1976. Shortly after the people rested, the defendant moved to suppress his prior conviction of unarmed robbery. The trial judge denied the motion, citing Jackson and Gordon v United States, 127 US App DC 343; 383 F2d 936 (1967), for the proposition that the similarity of the prior conviction and the charged offense is a factor weighing in favor of allowing impeachment by use of the conviction. After the denial of his motion, the defendant chose not to take the stand. In an unpublished opinion, the Court of Appeals affirmed the defendant’s conviction and held that the trial judge did not err in denying the motion to suppress because he "expressly recognized that he had discretion to allow or disallow the prior conviction impeachment”.
II
In Jackson, we discussed the Luck and Gordon cases and said that we intended trial judges to be guided in their exercise of discretion in this area by the factors enumerated in those decisions:
"Among the factors to be considered are the nature of the prior offense, whether it is for substantially the same conduct for which the accused is on trial, and the effect on the decisional process if the accused does not testify from fear of impeachment by prior convictions.” 391 Mich 333.
The error in these cases occurred because the trial judge weighed the nature of the prior offense (similarity) as a factor in favor of admissibility. Gordon, rather, makes similarity a factor weighing against admissibility:
"A special and even more difficult problem arises when the prior conviction is for the same or substantially the same conduct for which the accused is on trial. Where multiple convictions of various kinds can be shown, strong reasons arise for excluding those which are for the same crime because of the inevitable pressure on lay jurors to believe that 'if he did it before he probably did so this time.’ As a general guide, those convictions which are for the same crime should be admitted sparingly; one solution might well be that discretion be exercised to limit the impeachment by way of a similar crime to a single conviction and then only when the circumstances indicate strong reasons for disclosure, and where the conviction directly relates to veracity.” 127 US App DC 347.
The trial judge’s misapplications of this factor were error. Pursuant to GCR 1963, 853.2(4), we reverse the judgments of the Court of Appeals and remand each case to the Wayne Circuit Court for a new trial at which the trial judge shall decide, under Gordon, whether prior convictions should be admitted.
Coleman, C.J., and Kavanagh, Williams, Levin, Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred.
The record is not clear and it is possible that defendant’s prior conviction may have been of attempted robbery. | [
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Blair Moody, Jr.,
J. The sole issue before this Court is whether the Michigan criminal obscenity statute, MCL 750.343a; MSA 28.575(1), which proscribes the knowing dissemination of obscene materials, is constitutionally valid and enforceable on its face as it pertains to consenting adults under the First Amendment of the United States Consti tution and Article 1, § 5, Michigan Constitution of 1963. Today this Court, authoritatively construes the Michigan criminal obscenity statute as constitutionally proscribing the knowing dissemination of obscene materials to consenting adults. Miller v California, 413 US 15; 93 S Ct 2607; 37 L Ed 2d 419 (1973).
I. Facts
On October 21, 1975, defendant Neumayer was charged in the 50th District Court with two counts of violating MCL 750.343a; MSA 28.575(1). Specifically, the charges were possession with intent to show and showing two motion pictures ("All the Way” and "Final Blow”) at the Campus Theatre in Pontiac, Michigan.
On January 13, 1976, after a jury trial, the defendant was convicted on the "showing” count and he was sentenced on February 10, 1976, to two years probation. The "possession” count was dismissed by the district court judge.
Defendant appealed his conviction to the Oakland Circuit Court. The circuit court reversed the conviction, holding that the instant criminal obscenity statute applied only to the dissemination of obscene materials to juveniles and unconsenting adults but not to consenting adults.
The Michigan Court of Appeals denied leave to appeal, citing as authority People v Bloss, 394 Mich 79; 228 NW2d 384 (1975), and Kent County Prosecutor v Robert Emmett Goodrich Corp, 53 Mich App 267, 275; 218 NW2d 771 (1974), aff'd 396 Mich 253; 240 NW2d 242 (1976).
Upon appeal to this Court, the instant case was held in abeyance pending a decision in People v Llewellyn, 401 Mich 314; 257 NW2d 902 (1977). That decision was not dispositive of the issue presented herein, so we granted leave to appeal. 402 Mich 802 (1977).
We reverse the circuit court’s determination as to the criminal obscenity statute, but we affirm the reversal of the defendant’s conviction because at the time he committed the conduct charged, this Court had not construed the statute to proscribe such conduct.
II. The Current Status of the Federal Constitutional Law on Obscenity
In Miller v California, the United States Supreme Court simultaneously reaffirmed its previous position that obscenity is not constitutionally protected speech and fashioned a new, more restrictive definition of constitutionally protected speech. In Paris Adult Theatre I v Slaton, 413 US 49; 93 S Ct 2628; 37 L Ed 2d 446 (1973), released with Miller, the Court also unequivocally rejected the de facto holding of Redrup v New York, 386 US 767; 87 S Ct 1414; 18 L Ed 2d 515 (1967), that state police powers could not regulate obscene materials if displayed only to consenting adults. The Court announced that "there are legitimate state interests at stake in stemming the tide of commercialized obscenity, even assuming it is feasible to enforce effective safeguards against exposure to juveniles and to passersby.” 413 US 49, 57-58.
After dismantling the Redrup protection accorded to materials restrictively displayed, the Court proceeded in Miller to broaden the scope of the obscenity standard previously enunciated in Memoirs v Massachusetts, 383 US 413; 86 S Ct 975; 16 L Ed 2d 1 (1966).
Under the new Miller formulation, the Court declined to "propose regulatory schemes for the States”, Miller, supra, 25, but instead revised the Memoirs test in order to provide guidelines for the trier of fact to determine what is constitutionally obscene:
"(a) whether 'the average person, applying contemporary community standards’ would find that the work, taken as a whole, appeals to the prurient interest;
"(b) whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law; and
"(c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value.” (Citations omitted.) 413 US 15, 24.
Concomitant with its expansion of the scope of unprotected speech, the Court’s majority emphasized that state statutes designed to regulate obscene materials must be "specifically defined” and "carefully limited” either as written or as authoritatively construed by the state courts. The Court offered two examples "of what a state statute could define for regulation under the second part (b) of [the Miller test]”:
"(a) Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated.
"(b) Patently offensive representations or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals.” 413 US 15, 25.
See, also, United States v 12 200-ft Reels of Super 8mm Film, 413 US 123, 130, fn 7; 92 S Ct 2665; 37 L Ed 2d 500 (1973).
The majority was also careful to point out that its entire consideration of the question of obscenity was limited to the minimum protections afforded by the United States Constitution. That is, the Court did not "undertake to tell the States what they must do, but rather to define the area in which they may chart their own course in dealing with obscene materials”. 413 US 49, 53-54. Therefore, under the guarantees of the First and Fourteenth Amendments, the states may not use their police powers to regulate speech in a more restrictive fashion than allowed by Miller et al.
III. The Constitutionality of the Michigan Obscenity Statute Under Current Federal and State Law
The Michigan criminal obscenity statute, 1957 PA 265 as amended, MCL 750.343a; MSA 28.575(1), prohibits the knowing dissemination (or possession with intent to disseminate) of obscene materials:
"Any person who knowingly either sells, lends, gives away, distributes, shows or transmutes or offers either to sell, lend, give away, distribute, show or transmute, or has in his possession with intent either to sell, lend, give away, distribute, show or transmute, or advertise in any manner, or who otherwise knowingly offers for either loan, gift, sale or distribution, any obscene, lewd, lascivious, • filthy or indecent, sadistic or masochistic book, magazine, pamphlet, newspaper, story paper, writing, paper, phonograph record, picture, drawing, photograph, motion picture film, figure, image, wire or tape recording or any written, printed or recorded matter of an indecent character which may or may not require mechanical or other means to be transmuted into auditory, visual or sensory representations of such character, shall be guilty of a misdemeanor, and upon conviction shall be punished by imprisonment in the county jail for not more than 1 year or by a fine of not more than $1,000.00, or by both such fine and imprisonment.
"For the purpose of this section, possession of 6 or more identical copies, or 6 or more articles of any obscene, lewd, lascivious, filthy or indecent book, magazine, pamphlet, newspaper, story paper, writing, paper, phonograph record, picture drawing, photograph, slide, motion picture film, figure, image, wire or tape record ing, or any written, printed or recorded matter of an indecent character, shall be prima facie evidence of possession with intent to sell, lend, give away, distribute, show or transmute the thing.”
The standard to be employed by the trier of fact in determining whether certain materials are "obscene, lewd, lascivious, filthy or indecent, sadistic or masochistic” is found in MCL 750.343b; MSA 28.575(2) (1958 PA 127):
"The test to be applied in cases under section 343a of this act shall not be whether sexual desires or sexually improper thoughts would be aroused in those comprising a particular segment of the community, the young, the immature or the highly prudish, or would leave another segment, the scientific or highly educated or the so-called worldly wise and sophisticated, indifferent and unmoved. But such test shall be the effect of the book, picture or other subject to complaint considered as a whole, not upon any particular class, but upon all those whom it is likely to reach, that is, its impact upon the average person in the community. The book, picture or other subject of complaint must be judged as a whole in its entire context, not by considering detached or separate portions only, and by the standards of common conscience of the community of the contemporary period of the violation charged.”
In People v Bloss, supra, this Court was first presented with an opportunity to examine these two statutes in light of the test set forth in Miller, supra. However, the Court declined the invitation to decide whether the statutes could be validly applied to the dissemination of obscene material to consenting adults:
"We are persuaded that defendant’s conviction cannot stand for the reason that at the time he did the act complained of this Court had not construed the obscen ity statute (as permitted in Miller) to proscribe such conduct.
"We are unanimously of the opinion that the Michigan statutes regulating the dissemination of 'obscene’ material as applied to juveniles and unconsenting adults are valid and enforceable.
"We are divided as to whether such statutes can properly be construed by us without further legislative expression as proscribing the dissemination of 'obscene’ material to consenting adults. See Const 1963, art 1, §5.”
The people once again invite us, and indeed argue that we are compelled, to "authoritatively construe” the foregoing statutes so as to conform to the Miller standards and thus preserve their constitutionality. Miller, supra, 24, fn 6. Also see Hamling v United States, 418 US 87, 112-116; 94 S Ct 2887; 41 L Ed 2d 590 (1974), and Ward v Illinois, 431 US 767; 97 S Ct 2085; 52 L Ed 2d 738 (1977).
The defendant maintains that the instant statutes are constitutionally vague and overbroad, and fail to incorporate the minimum constitutional requirements set forth in Miller. Furthermore, the defendant contends that these statutes cannot be authoritatively construed to conform to Miller because the Michigan Constitution of 1963, art 1, § 5, contains a less restrictive definition of freedom of speech than that found in the First Amendment of the United States Constitution.
A. Vagueness and Overbreadth: Miller
Even a cursory comparison of the Michigan criminal obscenity statutes with the detailed requirements set forth in Miller reveals that the statutes lack the specificity required of a statute which seeks to regulate speech and thus unquestionably fail to pass Federal constitutional muster.
The terms employed in MCL 750.343a; MSA 28.575(1) — "obscene, lewd, lascivious, filthy or indecent, sadistic or masochistic” — are neither "specifically defined” nor "carefully limited” as constitutionally required of any statute designed to regulate speech or expression. Miller, supra.
Likewise, MCL 750.343b; MSA 28.575(2) does not contain, inter alia, the necessary limitation that the material in question lack "serious literary, artistic, political, or scientific value” in order to be found obscene. Miller, supra. Insofar as this statute defines "obscenity”, it appears to adopt the since-abandoned test announced in Roth v United States, supra, by asking "whether to the average person, applying contemporary community standards, the dominant theme of the material taken as a whole appeals to prurient interest”. 354 US 476, 489.
To define obscenity for constitutional purposes solely in terms of the capacity of the material to excite sexual thoughts or desires is clearly incompatible with Miller v California. Under Miller, statutes designed to suppress obscene material must, as written or construed, be limited not only to works which (a) appeal to prurient interests, but also to those which (b) depict or describe, "in a patently offensive way, sexual conduct specifically defined by the applicable state law”, and which (c) taken as a whole, lack "serious literary, artistic, political, or scientific value”.
MCL 750.343a; MSA 28.575(1) and MCL 750.343b; MSA 28.575(2) are not so limited. These statutes are vague and overbroad, and therefore unconstitutional on their face, as the people concede.
B. Michigan Constitution of 1963, Article 1, § 5
It is clear, as the defendant contends and the people concede, that the Michigan criminal obscenity statute, as presently written, is unconstitutionally vague and overbroad under First Amendment and Miller analysis. However, the people urge us to "construe” this obscenity statute, as Miller expressly permits, to conform to the Miller stan dards and thus prospectively preserve its constitutionality.
It is axiomatic that this Court will presume that all legislation is constitutional and will attempt to construe legislation so as to preserve its constitutionality:
"We are duty bound under the Michigan Constitution to preserve the laws of this state and to that end to construe them if we can so that they conform to Federal and state constitutional requirements.” People v Bricker, 389 Mich 524, 528; 208 NW2d 172 (1973).
The First Amendment provides in pertinent part:
"Congress shall make no law * * * abridging the freedom of speech.”
This First Amendment right to freedom of speech is guaranteed to citizens of the states by the Fourteenth Amendment. Book Tower Garage, Inc v Local No 415, International Union, UAWA(CIO), 295 Mich 580, 586; 295 NW 320 (1940).
But, as we discussed earlier, the United States Supreme Court has determined that obscenity is not within the scope of speech protected by the First Amendment. Miller, supra, 23. Therefore, we hold that the Michigan criminal obscenity statute, under the authoritative construction as to definitional limits given it today, does not conflict with the First Amendment.
However, the freedom of expression guarantee found in the Michigan Constitution is phrased somewhat differently:
"Every person may freely speak, write, express and publish his views on all subjects, being responsible for the abuse of such right; and no law shall be enacted to restrain or abridge the liberty of speech or of the press.” Const 1963, art 1, § 5.
The defendant, among others, urges us to hold that Michigan’s freedom of expression clause has a wider scope than the First Amendment and confers greater protection than its Federal counterpart on the dissemination of obscene materials to consenting adults.
While we agree that, in certain instances, the Michigan Constitution may confer broader protection upon certain types of expression, we do not agree that the right to freedom of expression in Michigan is unlimited.
Furthermore, upon careful examination, we find nothing either in the provision itself or in the history of the constitutional convention which even remotely leads us to believe the drafters ifitended to afford obscenity unlimited constitutional protection.
On the contrary, the phrase "being responsible for the abuse of such right” indicates that the drafters foresaw situations in which certain types of speech would not fall within the protection guaranteed by the provision. We believe that obscenity, as presently defined by the United States Supreme Court, represents an "abuse of such right” and therefore does not fall within the purview of the protection assured.
Additionally, we must not forget that constitutional provisions must be interpreted within the context of the times. Weems v United States, 217 US 349; 30 S Ct 544; 54 L Ed 793 (1910). The drafters of such provisions, even those who drafted such provisions as recently as the early 1960’s, could not anticipate all societal needs. The proliferation of obscene publications and films together with the commercial establishments which deal in such items have become commonplace in many areas and, as such, constitute a blight on our commercial and residential neighborhoods.
The Legislature has determined that the dissemination of obscene materials within this state is injurious to society. Therefore, the Legislature has decided, as a matter of public policy, to proscribe the dissemination of obscene materials. "The public policy of this state is a mandate upon us.” Bricker, supra, 529.
We do not agree that the intervening 1963 Michigan Constitution, art 1, § 5, provides greater protection for the knowing dissemination of obscene materials to consenting adults than that afforded by the First Amendment of the United States Constitution. Nor do we find any indication of legislative intent that the instant statute be applied only to the dissemination of obscene maté rials to juveniles and unconsenting adults, but not to consenting adults. See Bloss, supra.
IV. Conclusion
Despite prior suggestions from this Court that the Legislature revise the present criminal obscenity statute in light of Miller v California, supra, to provide a specific definition of obscenity and specific standards for the trier of fact in determining what is constitutionally obscene, the Legislature has not seen fit to act in this regard.
However, in view of previously expressed legislative public policy, we refuse to leave Michigan without a valid criminal obscenity statute. Therefore, with some reluctance, we announce today that prospective from the date of this opinion the courts of this state shall construe MCL 750.343a; MSA 28.575(1), so that it conforms to the minimum standards set forth in Miller v California, supra.
Specifically, we hold that the standards to be employed by the trier of fact in determining what is constitutionally obscene are those formulated in Miller:
"(a) whether 'the average person, applying contemporary community standards’ would find that the work, taken as a whole, appeals to the prurient interest;
"(b) whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law; and
"(c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value.” (Citations omitted.) 413 US 15, 24.
Furthermore, in defining the terms "obscene, lewd, lascivious, filthy or indecent, sadistic or masochistic”, MCL 750.343a; MSA 28.575(1), we incorporate the Miller definitions into the existing statute:
"(a) Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated.
"(b) Patently offensive representations or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals.” 413 US 15, 25.
In conclusion, we reverse the circuit court’s determination that the instant criminal obscenity statute has no applicability to the dissemination of obscene materials to consenting adults. As for defendant Neumayer, we affirm the circuit court’s reversal of his conviction because at the time he committed the conduct charged, this Court had not construed the statute per Miller to proscribe such conduct.
Coleman, C.J., and Williams, Fitzgerald, and Ryan, JJ., concurred with Blair Moody, Jr., J.
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”
"Every person may freely speak, write, express and publish his views on all subjects, being responsible for the abuse of such right; and no law shall be enacted to restrain or abridge the liberty of speech or of the press.”
Llewellyn was an appeal of convictions for exhibition of two allegedly obscene films under an East Detroit anti-obscenity ordinance. Defendants argued that their convictions must be reversed because the anti-obscenity ordinance in question was pre-empted by the existing state statutory scheme governing criminal obscenity offenses, and was thus unconstitutional under Const 1963, art 7, § 22.
Given the comprehensive coverage of the field under the state statutory scheme, MCL 750.343a et seq.; MSA 28.575(1) et seq., and the need for a uniform, statewide definition of criminal obscenity offenses for purposes of protecting free speech and effectively deterring obscenity, this Court held that East Detroit’s anti-obscenity ordinance was pre-empted by the existing state statutory scheme and was thus unconstitutional under Const 1963, art 7, § 22.
■The Court opined that statewide definition of obscenity allowed for both vigorous, effective local prosecution under state law and the protection of legitimate freedom of expression. Moreover, localities could supplement the protection afforded them under the state obscenity statutory scheme with municipal zoning, such as that recently promulgated in Detroit, designed to regulate the location of establishments featuring so-called "adult entertainment”. Such municipal zoning ordinances were declared outside the field of prohibition occupied by the state statutory scheme.
The Court, however, was not presented with and therefore did not reach the question of whether the state criminal obscenity statute itself was constitutional.
The United States Supreme Court released seven other opinions along with Miller. While Miller was the principal opinion, the other opinions dealt in detail with related obscenity issues. See Paris Adult Theatre I v Slaton, 413 US 49; 93 S Ct 2628; 37 L Ed 2d 446 (1973); Kaplan v California, 413 US 115; 93 S Ct 2680; 37 L Ed 2d 492 (1973); United States v 12 200-ft Reels of Super 8mm Film, 413 US 123; 92 S Ct 2665; 37 L Ed 2d 500 (1973); United States v Orito, 413 US 139; 93 S Ct 2674; 37 L Ed 2d 513 (1973); Heller v New York, 413 US 483; 93 S Ct 2789; 37 L Ed 2d 745 (1973); Roaden v Kentucky, 413 US 496; 93 S Ct 2796; 37 L Ed 2d 757 (1973); Alexander v Virginia, 413 US 836; 93 S Ct 2803; 37 L Ed 2d 993 (1973).
In Roth v United States, 354 US 476; 77 S Ct 1304; 1 L Ed 2d 1498 (1957), a five-justice majority, the first of many such narrow majorities in obscenity cases, concluded, through Justice Brennan, that obscenity was not entitled to first amendment protection inasmuch as it was utterly without redeeming social importance. Logically extending from this premise, the Court articulated as the appropriate test for obscenity whether the "dominant theme” of the material challenged "taken as a whole appeals to the prurient interest” of "the average person, applying contemporary community standards”. Roth, supra, 489. The Court, however offered no criteria through which to reduce such an amorphous concept of obscenity to workable sociojudicial guidelines.
For an extensive historical analysis of the development of obscenity case law, see Lockart & McClure, Censorship of Obscenity: The Developing Constitutional Standards, 45 Minn L Rev 5 (1960), and Note, Constitutional Law — Obscenity, 40 Brooklyn L Rev 442 (1973).
In Memoirs v Massachusetts, 383 US 413; 86 S Ct 975; 16 L Ed 2d 1 (1966), the Court reversed a decision from Massachusetts that Fanny Hill was obscene. In so doing, the Court, again under the leadership of Justice Brennan specified that the proper test of obscenity required that the materials challenged must meet each of three Federal constitutional criteria independently: the material must appeal to prurient interests; it must be patently offensive; and it must be "utterly without redeeming social value”. This so-called Roth-Memoirs test remained as the controlling doctrine until 1973.
The plurality opinion in Memoirs represented only one of seven approaches taken in that case. The position this opinion occupied in the spectrum of viewpoints allowed it, in effect, to be decisive. But because of the multiplicity of viewpoints, many subsequent cases were decided according to an approach developed in Redrup v New York. In Redrup, the Court reversed several state convictions, explaining in a per curiam opinion that the publications in question were constitutionally protected no matter which of the prevailing views was applied. Thereafter, the Court disposed of 31 obscenity cases in this manner, often giving no explanation other than a citation to Redrup.
The Memoirs standard was a plurality, not a majority, position. It never gathered majority support but continued to be the controlling definition of obscenity through Redrup and until Miller.
See fn 4.
Clarity in the law is a prime requisite of due process. A criminal statute will be found vague and thus void on its face if it fails to provide fair notice of what the state commands or forbids or if it invites arbitrary and erratic enforcement. This is quite apart from whether or not it interferes with liberty of speech or expression.
A law suppressing speech is subject, however, to especially strict standards of specificity. Freedom of expression is vulnerable to greatly damaging but barely visible encroachments. Vague prohibitions engender the possibility that people will restrict their conduct only to that which is unquestionably safe. Free speech may not be so chilled. Thus even greater clarity and precision than in other contexts is required of statutes regulating expression.
In this respect, the problem of vagueness in the area of protected expression is closely related to that of overbreadth. A law may be unconstitutionally overbroad, even though perfectly definite, if its terms deter the exercise of rights protected by the First Amendment. Such a law is also void on its face; even a litigant whose conduct falls outside the First Amendment may assert that the statute applied against him is unconstitutionally overbroad. See amicus curiae brief of the American Civil Liberties Union Fund of Michigan, p 7.
People’s brief, p 19.
Some, but not all, states have accepted the Court’s invitation to "Miller-ize” their existing statutes.
The Harvard Law Review compiled an impressive state-by-state survey of what the various states had done in this regard as of 1975:
"Some state courts have regarded the Miller requirement that obscenity laws specifically define potentially offensive depictions or descriptions of sexual conduct as necessitating the invalidation of pre-Miller obscenity laws. See Commonwealth v Horton, [365 Mass 164] 310 NE2d 316, 319-322 (1974); Art Theater Guild, Inc v State, 510 SW2d 258, 260-261 (Tenn, 1974); Mohney v State, [261 Ind 56] 300 NE2d 66, 67 (1973); State v Wedelstedt, 213 NW2d 652, 656-657 (Iowa, 1973); State v Shreveport News Agency, Inc, 287 So 2d 464, 468-470 (La, 1973). In Louisiana, Massachusetts, and Tennessee, state legislatures enacted replacement obscenity statutes satisfying the Miller specificity requirement. See La Rev Stat Ann § 14:106 (West 1974); Mass Gen Laws Ann, ch 272, § 31 (1975); Tenn Code Ann § 39-3010 (Supp 1974). The Iowa legislature elected to do without a statute criminally punishing distribution of obscenity to consenting adults, but instead passed a law prohibiting dissemination of obscenity to minors. See ch 1267, [1974] Iowa Acts 977. In Indiana, local ordinances have filled the gap left by invalidation of the state statute. See Note, Defects in Indiana’s Pornographic Nuisance Act, 49 Ind L J 320, 331 (1974). Other state courts, however, dealing with essentially similar statutes, have held that the requisite specificity may be achieved through judicial construction. Many of the courts engaging in statutory construction simply read into state obscenity laws Miller’s examples of specific definitions, see 413 US at 25. See, e.g., Pierce v State, 292 Ala 473, 477; 296 So 2d 218, 221 (1974), cert den [419 US 1130] (1975); Gibbs v State, [255 Ark 997] 504 SW2d 719, 725-726 (1974); State v Welke, 298 Minn 402, 409; 216 NW2d 641, 646-647 (1974); State v DeSantis, 65 NJ 462, 471-472; 323 A2d 489, 495 (1974); State v Bryant, 285 NC 27, 40; 203 SE2d 27, 35 cert den, 419 US 974 (1974); State v Watkins, [262 SC 178] 203 SE2d 429, 432-433 (1973), app dis, 418 US 911 (1974).
"In a few states, however, judicial specification has been more elaborate. See, e.g., State v Harding, [114 NH 335] 320 A2d 646, 651 (1974) (listing six categories of 'potentially offensive "sex” or "sexual conduct” ’); State v J-R Distrib, Inc, 82 Wash 2d 584, 601-602; 512 P2d 1049, 1060-1061 (1973), cert den, 418 US 949 (1974) (adding bestiality to categories listed in Miller examples); State ex rel Chobot v Circuit Court, 61 Wis 2d 354, 369-370; 212 NW2d 690, 698 (1973), modified on other grounds, 61 Wis 2d 374a; 212 NW2d 701 (1974) (same). Courts have found judicial reconstruction unnecessary in some cases, either because statutory language was thought to be sufficiently specific already, see, e.g., Ballew v State, 292 Ala 460, 464; 296 So 2d 206, 209 (1974), cert den, [419 US 1130] (1975); State v Aiuppa, 298 So 2d 391, 396-397 (Fla, 1974); State v Little Art Corp, 191 Neb 448, 451-452; 215 NW2d 853, 856 (1974); State ex rel Wampler v Bird, 499 SW2d 780, 784 (Mo, 1973) (per curiam); State ex rel Keating v "Vixen,” 35 Ohio St 2d 215, 218-219; 301 NE2d 880, 882 (1973), or because prior construction had seemingly confined a statute’s scope within the Miller limits, see, e.g., People v Enskat, 33 Cal App 3d 900, 908-909; 109 Cal Rptr 433, 438-439 (1973), cert den, 418 US 937 (1974); Rhodes v State, 283 So 2d 351, 357-359 (Fla, 1973); Slaton v Paris Adult Theater I, 231 Ga 312, 316; 201 SE2d 456, 459 (1973), cert den, 418 US 939 (1974); People v Heller, 33 NY2d 314, 327-328; 307 NE2d 805, 812-813; 352 NYS2d 601, 612-613 (1973), cert den sub nom, Buckley v New York, 418 US 944 (1974); Price v Commonwealth, [214 Va 490] 201 SE2d 798, 800 (1974), cert den, 419 US 902 (1974).
"Some state legislatures have independently responded to the Miller specificity requirement, in a few instances enacting new statutes even though courts had either approved the specificity of the prior law, or had construed that law to meet Miller’s requirement. See, e.g., Ky Rev Stat § 531.010 (1975) (Penal Code); NY Penal Law § 235.00 (McKinney Supp 1974); NC Gen Stat § 14-190.1 (Supp 1974); Ohio Rev Code Ann § 2907.01 (Page Supp 1973). In a few instances, legislatures apparently moved in advance of state courts. See, e.g., Ariz Rev Stat Ann § 13-531.01 (Supp 1974); SD Compiled Laws Ann § 22-24-27 (Supp 1974).
"Following the Supreme Court’s dictum in United States v 12 200-Ft Reels of Super 8mm Film 413 US 123, 130, fn 7 (1973), federal obscenity statutes have been judicially construed to satisfy the specificity requirement through incorporation of the Miller examples. See, e.g., Hamling v United States, 418 US 87, 114 [94 S Ct 2887; 41 L Ed 2d 590] (1974) (construing 18 USC 1461 [1970]); United States v Thevis, 484 F2d 1149, 1155 (CA 5, 1973), cert den, 418 US 932 (1974) (construing 18 USC 1462 [1970]); United States v Marks, 364 F Supp 1022, 1026 (ED Ky, 1973) (construing 18 USC 1465 [1970]); United States v One Reel of Film, 481 F2d 206, 209-210 (CA 1, 1973) (construing 19 USC 1305[a] [1970]).”
Note, Community Standards, Class Actions, and Obscenity Under Miller v California, 88 Harv L Rev 1838, fn 51, 1847-1848 (1975).
Since this Court previously refused to construe the criminal obscenity statute vis-á-vis consenting adults, People v Bloss, supra, and since the statute as presently written is vague and overbroad, we can only "Miller-ize” the statute prospectively.
It would be an obvious denial of due process to hold any defendant, including defendant Neumayer, criminally ("knowingly”) responsible for conduct charged before today’s construction of the statute.
The Miller "definitional limits” represent minimum protections. The Legislature is still free to enact a criminal obscenity statute which would afford greater protection to certain types of speech. It could conceivably determine to remove any restrictions upon obscenity whatsoever. The State may not use its police power, however, to regulate certain forms of speech in a more restrictive fashion than allowed in today’s opinion. See New Hampshire v Manchester News Co, Inc, 387 A2d 324 (1978).
See, for example, Norris, A "Freedom of Expression” in the New Constitution, 31 Detroit Lawyer 190 (1963); Burkoff & Adamo, Obscenity Under the Michigan Constitution: Protected Expression?, 54 Mich St B J 964, 969-973 (1975).
This Court has determined in various cases that the Michigan Constitution confers greater protection than its federal counterpart. See, inter alia, People v Beavers, 393 Mich 554; 227 NW2d 511 (1975); People v White, 390 Mich 245; 212 NW2d 222 (1973); People v Den Uyl, 318 Mich 645; 29 NW2d 284 (1947); People v Victor, 287 Mich 506; 283 NW 666 (1939).
Also cf. Brennan, State Constitutions and the Protection of Individual Rights, 90 Harv L Rev 489 (1977); Howard, State Courts and Constitutional Rights in the Day of the Burger Court, 62 Va L Rev 873 (1976).
The "freedom of expression” provision of our present constitution differs in two relevant respects with the earlier Constitution of 1908. The word "express” was added to the section, and the word "views” was substituted for "sentiments”. The changes were explained to the delegates by committee comment:
"The committee believes that the multiplicity of contemporary means of expression (as over and against the traditional means of speaking and writing) justifies the first change, while the word 'views’ seems to have a sharper and more specific meaning than the former word sentiments.”
See 1 Official Record, Constitutional Convention 1961, Committee Proposal 15, § 4 (Const 1963, art 1, § 5), p 466.
Furthermore, in the "Address to the People”, the publication which informs voters of the purpose of constitutional provisions, it was stated:
"This is a revision of Sec 4, Article II, of the present constitution preserving these traditional guarantees. It broadens them by including the word 'express’ and substituting the word 'views’ for 'sentiments’. Addition of the word 'express’ is intended to recognize development of new means of communication in recent years. The word 'views’ seems to have a sharper and more specific meaning than the former word 'sentiments.’ ”
See 2 Official Record, Constitutional Convention 1960, Address to the People, p 3363.
To assist in determining the purpose sought to be accomplished by a constitutional provision, the convention debates and the Address to the People may be consulted. Regents of the University of Michigan v Michigan, 395 Mich 52; 235 NW2d 1 (1975); Burdick v Secretary of State, 373 Mich 578; 130 NW2d 380 (1964).
It should not be overlooked that even a display of "specifically defined” obscene material under the Miller standard would not be obscene in the constitutional sense and therefore not proscribed if the work, taken as a whole, possesses serious literary, artistic, political or scientific value.
The Constitution of 1963 was promulgated almost six years after the criminal obscenity statute was enacted (1957 PA 265).
People v Bloss, supra; People v Llewellyn, supra, 322, fn 3.
On February 24, 1978, the Governor signed 1978 PA 33 prohibiting the dissemination of sexually explicit material to minors (effective June 1,1978).
The Legislature has not acted regarding the dissemination of obscene materials to unconsenting and consenting adults. The uncertainty of the Legislature regarding the constitutionality of legislation in this field prompted House Resolution No 440, adopted April 24, 1978, requesting the opinion of the Supreme Court as to the constitutionality of 1978 PA 33.
We reluctantly take today’s action. The Court has only two options at this point in time: "Miller-ize” the existing statute or declare it unconstitutional under Federal and state law. We perceive the Miller approach to be the less offensive option because it does not leave Michigan without a criminal obscenity statute.
However, we would have preferred that the Legislature pass a new comprehensive state criminal obscenity statute. We would still encourage the Legislature to enact a new statute because, while we view the Miller approach as less offensive, we are not convinced Miller presents a viable solution to the problem.
The history of the obscenity problem post-Miller indicates that we are no closer to a solution of this thorny legal problem at either the federal or state level.
Nevertheless, as stated by Chief Justice Earl Warren:
"In this and other cases in this area of the law, which are coming to us in ever-increasing numbers, we are faced with the resolution of rights basic both to individuals and to society as a whole. Specifically, we are called upon to reconcile the right of the Nation and of the States to maintain a decent society and, on the other hand, the right of individuals to express themselves freely in accordance with the guarantees of the First and Fourteenth Amendments.
"No government — be it federal, state, or local — should be forced to choose between repressing all material, including that within the realm of decency, and allowing unrestrained license to publish any material, no matter how vile. There must be a rule of reason in this as in other areas of the law, and we have attempted * * * to provide such a rule.” Jacobellis v Ohio, 378 US 184, 199-200; 84 S Ct 1676; 12 L Ed 2d 793 (1964).
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Williams, J.
In this case we consider whether to adopt a rule of comparative negligence in Michigan. The factual circumstances involve a close question of the negligence of one or both of two drivers: driver Placek, a layperson who was traveling on a through street and the other, Police Officer Ernst on an emergency run traveling past a stop sign. We do not sit as trier of fact as to whether either, neither or both of these drivers were negligent.
We hold, in the interest of justice for all litigants in this state, that the doctrine of comparative negligence hereby replaces the doctrine of contributory negligence and that the standards of comparative negligence are to be applied by the court on remand for new trial in the instant case and on a limited retroactive basis.
I. Facts
On April 8, 1970, plaintiff, Patricia Placek was traveling east on Plumbrook, a two-lane highway, at 30-35 miles per hour. It is uncontested that this was the speed at which plaintiff was traveling and that the posted speed limit was 35 miles per hour.
Plaintiff was following the car of Cabell and Virginia Woods, also traveling east on Plumbrook. As the Woods’ car approached Schoenherr, the driver of that vehicle slowed to execute a right- hand turn. At this point Ms. Placek moved her vehicle into the left lane to go around the Woods’ vehicle and pass through the Schoenherr intersection. She collided with the right side of the vehicle driven by Police Officer Ernst a little more than half way across Schoenherr. Ms. Placek testified that she had only become aware of the police vehicle when it was too late to avoid the collision.
Defendant Police Officer Ernst was traveling south on Schoenherr on an emergency run. As he approached the Plumbrook intersection, both his siren and flasher were in operation. Defendant testified that he was aware of the Woods’ vehicle but did not see plaintiffs vehicle. Defendant further testified that he slowed down before he approached the Plumbrook intersection but had begun to speed up again as he entered the intersection. There is disputed testimony as to the speed at which defendant was traveling; defendant told Officer James Porter, the investigating officer at the scene of the accident, however, that he was traveling at 30 miles per hour.
Nothing at the intersection obstructed the view of either driver.
The only non-party witnesses to the accident were Cabell and Virginia Woods. As stated above, their vehicle was traveling east on Plumbrook in front of plaintiffs vehicle, and had begun execution of a right-hand turn onto Schoenherr. Virginia Woods, the passenger, noticed the approaching police car and called it to her husband’s attention. Mr. Woods then brought his vehicle to a stop. Mr. Woods testified that he thought the police vehicle was traveling at 40 miles per hour. Ms. Woods testified that the officer was traveling faster than the posted 35 miles per hour speed limit.
Plaintiff originally filed suit against defendants Ernst and the City of Sterling Heights on July 28, 1970. A trial was held in October, 1972, and resulted in a verdict of no cause of action against plaintiff. This verdict was reversed and remanded for new trial by the Court of Appeals on the basis that the trial court had erred in allowing plaintiff to be questioned as to whether she wore a seat belt. Placek v Sterling Heights, 52 Mich App 619; 217 NW2d 900 (1974). The second trial took place in May, 1975, and again resulted in a verdict of no cause of action against plaintiff. This verdict was affirmed by the Court of Appeals in an unpublished memorandum opinion. Leave to appeal was granted by this Court on November 23, 1977.
II. Issues
We granted leave to appeal to consider three issues: (1) whether a comparative negligence standard should be adopted in this state, (2) whether the trial court’s instruction as to plaintiff’s duty of care was prejudicially erroneous and (3) whether reasonable minds can differ as to whether defendant Ernst was negligent.
III. Comparative or Contributory Negligence
There is little dispute among legal commentators that the doctrine of contributory negligence has caused substantial injustice since it was first invoked in England in 1809. Of significance in this regard is that almost every common-law jurisdiction outside the United States has discarded contributory negligence and has adopted in its place a more equitable system of comparative negligence. Even in this country, considered the only remaining primary location employing contributory negligence, 32 states and the United States Supreme Court in the case of admiralty law have discarded or rejected it in favor of some form of comparative negligence. This precedent is so compelling that the question before remaining courts and legislatures is not whether but when, how and in what form to follow this lead. Therefore, to the properly raised question of whether a comparative negli gence standard should be substituted for contributory negligence in Michigan, we answer in the affirmative.
In July, 1977, three Justices on this Court would have established comparative negligence as the rule in this state. Kirby v Larson, 400 Mich 585; 256 NW2d 400 (1977), involved a factual situation typical of the potential injustice of the doctrine of contributory negligence.
In Kirby, a defendant, driving north, approached an intersection passing by a car also traveling north which had already come to a stop at the intersection for a changing light. Plaintiff Christine Kirby was a passenger in a car which had been proceeding south on the same street and was stopped at the intersection waiting to make a left-hand turn. Both Kirby and the driver saw the first .vehicle come to a stop and anticipated that defendant, then about three or four car lengths back from the intersection, would do the same.
Plaintiff suggested completion of the turn to the driver, although there was some disputed testimony as to whether this suggestion was made after the driver was already turning the wheel of the car, and the driver proceeded to turn. Defendant’s car, traveling at 25-30 miles per hour, struck the right rear of the car in which plaintiff was a passenger; plaintiff was thrown from the car and seriously injured.
The trial court instructed the jury on contributory negligence:
"* * * if you find that Christine Kirby was personally and contributorily negligent and such negligence was a proximate cause of the injury and damages alleged by her and in that event Christine Kirby cannot recover from the defendant and your verdict therefore would be for the defendant.” Kirby, supra, 595.
The jury returned a verdict in favor of defendant.
Kirby was heard at this Court by six Justices, and the ultimate disposition included two opinions, each one representing the views of three Justices. The Williams opinion in Kirby found in part III that instructional errors at the trial level required reversal and remand for new trial. Beyond this, through the Williams opinion, the Chief Justice, Justice Levin and Justice Williams would have adopted comparative negligence as a substitute for contributory negligence in Michigan and would have instituted that doctrine as prevailing on remand.
The three other participating Justices in Kirby concurred in part III of the Williams opinion, finding error below necessitating remand and a new trial. Justice Fitzgerald’s opinion, however, signed by Justices Coleman and Ryan, did not find Kirby the appropriate vehicle for adopting comparative negligence. That opinion found the record before this Court inadequate because, unlike the instant case, the parties had not fully briefed and discussed the issue.
Because many aspects of comparative negligence were extensively dealt with in Kirby, only a brief review of certain of these is necessary. The sub-issues specifically discussed under headings "A”, "B” and "C”, infra, are those raised by the parties. A. Judicial Adoption of Comparative Negligence
In part IX of the Williams opinion in Kirby, a brief analysis was made as to the propriety of judicial versus legislative abrogation of contributory negligence and adoption of comparative negligence.
There is no question that both this Court and the Legislature have the constitutional power to change the common law.
"The common law and the statute laws now in force, not repugnant to this constitution, shall remain in force until they expire by their own limitations, or are changed, amended or repealed.” Const 1963, art 3, § 7.
This provision has been construed to authorize both judicial change and legislative amendment or repeal. Myers v Genesee County Auditor, 375 Mich 1, 7; 133 NW2d 190 (1965).
Further, when dealing with judge-made law, this Court in the past has not disregarded its corrective responsibility in the proper case.
"[O]ur Court has heretofore believed that rules created by the court could be altered by the court. For example, we abrogated the defense of assumption of risk, Felgner v Anderson, 375 Mich 23; 133 NW2d 136 (1965), repudiated the doctrine of imputed negligence, Bricker v Green, 313 Mich 218; 21 NW2d 105 (1946), eliminated the privity requirement in actions for breach of an implied warranty, Spence v Three Rivers Builders & Masonry Supply, Inc, 353 Mich 120; 90 NW2d 873 (1958), overruled the common-law disability prohibiting the wife from suing for the loss of her husband’s consortium, Montgomery v Stephan, 359 Mich 33; 101 NW2d 227 (1960), overruled the common-law disallowance of recovery for negligently inflicted prenatal injury, Womack v Buchhorn, 384 Mich 718, 724-725; 187 NW2d 218 (1971); and even eliminated charitable immunity from negligence, Parker v Port Huron Hospital, 361 Mich 1; 105 NW2d 1 (1960).” Kirby, 625.
The question then is whether a judicial forum is appropriate for adoption of comparative negligence. In three of the states now employing comparative negligence, that rule was judicially adopted: Alaska, Kaatz v State, 540 P2d 1037 (Alas, 1975); California, Li v Yellow Cab Co of California, 13 Cal 3d 804; 532 P2d 1226; 119 Cal Rptr 858 (1975); Florida, Hoffman v Jones, 280 So 2d 431 (Fla, 1973).
Points raised against such judicial action include the legislature’s superior power of investigation and ability to handle collateral problems as well as the legislature’s ability to pass statutes which come into effect at some future date thereby providing notice to the bench and bar of impending change.
However, considerations favoring judicial adoption rather than legislative are equally if not more compelling. Professor Fleming analyzes and ably disputes the three main points often asserted in favor of legislative adoption:
"First is the question which of these two bodies is better equipped to understand the nature and implications of the problem and to make an informed choice from available alternatives. It is fashionable to suppose that the investigatory opportunities of the legislature establish its superior credentials in this respect. * * * But on the question of contributory negligence, one cannot very well dispute the unique judicial experience and preoccupation * * *. Moreover, such quantitative data as exist on the impact of comparative negligence on insurance rates [see appendix in Kirby, p 651] and on the processing of claims by settlement or resort to court [see appendix in Kirby, p 648] are at least as well available to judges as to legislators. * * * Nor should one lightly indulge the fancy that because many legislators have enjoyed legal training, they are therefore as sensitive to the need for reform or as well equipped to pass an independent judgment on this issue as are the courts. In a nutshell, this is preeminently lawyer’s law.” (Emphasis added.) Fleming, Foreword: Comparative Negligence at Last — By Judicial Choice, 64 Calif L Rev 239, 279-280 (1976).
The next point analyzed by Professor Fleming is the assertion of the Legislature’s superior ability to enact the primary change and simultaneously anticipate and resolve the numerous details and collateral issues at one time. Professor Fleming cites two points in response.
"First, almost all comparative negligence statutes are * * * in the briefest conceivable form and leave the very same ancillary questions likewise to the courts for future solution. Second, courts can * * * anticipate several of the most important of these questions and thus dispose [sic] with the need for having them later explored at the cost of future litigants. Far from deserving rebuke for dealing with hypotheticals, this practice reveals courts as being on occasion at least as well equipped as legislatures in laying down a reasonably comprehensive blueprint of reform.” Fleming, supra, 281.
Finally, Professor Fleming analyzes
"the argument that legislative reform can give affected parties time to prepare themselves for the change of law, for example by procuring liability insurance and by adjusting cost calculations. Thus, statutes abrogating charitable and other immunities have commonly postponed their commencement for that purpose. But courts also have long broken with the Blackstonian fiction that judicial decisions must necessarily be retroactive in operation because they merely declare what the common law should always have been discovered to be.” Fleming, supra, 281.
As is indicated by the above analysis, although the courts have not been the primary agencies for adoption of comparative negligence, they are certainly in as good, if not better, a position to evaluate the need for change, and to fashion that change.
Further, as to the final point raised by Professor Fleming regarding the need for advance warning, this is uniquely satisfied in this jurisdiction because the bench and bar were put on notice a year and a half ago when three members of this Court advocated adoption of comparative negligence in Kirby, supra.
With all these factors in mind, we find adoption of comparative negligence is consistent with this Court’s responsibility to the jurisprudence of this state.
B. Appropriate Form of Comparative Negligence
Extensive discussion in the Williams opinion in Kirby was devoted to an analysis of the most appropriate form of comparative negligence to adopt. Kirby, 629-645. Since that time, we have not altered our view that the doctrine of "pure” comparative negligence most nearly accomplishes the goal of a fair system of apportionment of damages. "Only pure comparative negligence truly distributes responsibility according to fault of the respective parties.” Schwartz, Comparative Negligence (Indianapolis: Allen Smith Co, 1974), § 21.3, p 347.
As stated in Kirby,
"We are convinced, as was the United States Supreme Court and the other courts which have adopted the comparative negligence doctrine, that the 'pure’ form is preferable to any other.
"The 'pure’ form does not 'unjustly enrich’ anyone. For example, if an accident is wholly the fault of one party, then that party would not, of course, recover damages. If an injured plaintiff was 51% to blame, there still remains 49% of the fault which was not plaintiffs, and for which therefore the person who caused that much of the injury should be liable.
"The rule preventing recovery if plaintiffs negligence exceeds 50% of the total fault is just as arbitrary as that which completely denies recovery. Is the person who is 49% negligent that much more deserving than the one who is 51% negligent?
"We acknowledge that even under the 'pure’ form of comparative negligence there will be appeals concerning the percentage of award, but it is undoubtedly more compelling to appeal when you have been awarded nothing than when you have received some compensation. However, just as we did not reach our decision on 'contributory negligence because of the anticipated number of case filings, we will not reach our decision on the form of comparative negligence because of an equally unpredictable element, the anticipated number of appeals.
"Commentators acknowledge that the hybrid 50% rule leads to strange results.
"What the hybrid rule does in fact is not eliminate contributory negligence, but merely lower the barrier.
"The doctrine of pure comparative negligence does not allow one at fault to recover for one’s own fault, because damages are reduced in proportion to the contribution of that person’s negligence, whatever that proportion is. The wrongdoer does not recover to the extent of his fault, but only to the extent of the fault of others. To assume that in most cases the plaintiff is more negligent than the defendant is an argument not based on equity or justice or the facts. What pure comparative negligence does is hold a person fully responsible for his or her acts and to the full extent to which they cause injury. That is justice.
"This is the system of comparative negligence judicially adopted in Florida, California, Alaska, and by the United States Supreme Court to replace the equal division rule in admiralty actions. It is the system in the FELA, the Merchant Marine Act, the Jones Act, and Death on the High Seas Act. It is simplest to administer where multiple defendants are concerned. The system in operation has not led 'to runaway verdicts for negligent plaintiffs’. Schwartz, Treatise, § 3.2, p 52.
"We recognize that the 50% system has been the most popular among those legislatively adopted. Schwartz, § 3.5, p 73. But it is not the system which we believe will really do justice.” (Footnotes omitted.) Kirby, 642-645.
Recognizing this same rationale, we now adopt the pure form of comparative negligence. Hereafter, a special verdict shall be used in any negligence case where the negligence of the plaintiff is at issue.
C. Appropriate Application
The extent of application of the new rule announced today remains to be determined. Although there are a great variety of ways in which a new rule of law may be given effect, application normally falls within one of three main categories. A new rule can be (1) made applicable to all cases in which a cause of action has accrued and which are still lawfully pending and all future cases, (2) made applicable to the case at bar and all future cases or (3) made to exclude the case at bar but be made applicable to all cases to be filed hereafter or after an arbitrary control date specified herein. See Myers v Genesee County Auditor, 375 Mich 1, 11; 133 NW2d 190 (1965).
In Li v Yellow Cab Co of California, supra, 829, the California Supreme Court gave limited retroactive effect to its adoption of comparative negligence. The court stated that its opinion would be
"applicable to all cases in which trial has not begun before the date this decision becomes final in this court, but * * * it shall not be applicable to any case in which trial began before that date (other than the instant case) — except that if any judgment be reversed on appeal for other reasons, this opinion shall be applicable to any retrial.”
The Alaska Supreme Court in Kaatz v State, supra, 1050, applied its opinion adopting comparative negligence as follows:
. "The rule will, of course, apply in the retrial of the case in which we have reversed the judgment today. It will also apply to any case in which the trial commences after the date of this opinion. In any case pending on direct appeal in which the application of the comparative negligence rule was requested or asserted in the trial court, and in which the request or assertion was preserved as a ground for appeal, there shall be a retrial under the principle of comparative negligence. Our holding today will be applicable to any trial which has commenced, but has not been submitted for decision by the trier of fact, and in which prior to submission to the trier of fact for decision there has been a request or an assertion that the rule of comparative negligence should be applied.”
Finally, the Florida Supreme Court, in its opinion adopting comparative negligence, Hoffman v Jones, supra, 440, held that the
"* * * opinion shall be applied as follows:
"1. As to those cases in which the comparative negligence rule has been applied, this opinion shall be applicable. [In Hoffman, before the case reached the Florida Supreme Court, the District Court of Appeal had adopted comparative negligence.]
"2. As to those cases already commenced, but in which trial has not yet begun, this opinion shall be applicable.
"3. As to those cases in which trial has already begun or in which verdict or judgment has already been rendered, this opinion shall not be applicable, unless the applicability of the comparative negligence rule was appropriately and properly raised during some stage of the litigation.
"4. As to those cases on appeal in which the applicability of the comparative negligence rule has been properly and appropriately made a question of appellate review, this opinion shall be applicable.
"5. This opinion shall be applicable to all cases commenced after the decision becomes final.”
The long-standing rule of law has been in favor of full retroactivity. See Kuhn v Fairmont Coal Co, 215 US 349, 372; 30 S Ct 140; 54 L Ed 228 (1910); Donohue v Russell, 264 Mich 217, 219; 249 NW 830 (1933); 20 Am Jur 2d, Courts, § 233, p 562. However, more frequently courts are favoring more flexible approaches which allow determinations on a case-by-case basis.
"The determination of whether an overruling decision shall be applied retroactively or prospectively, is a matter left to state courts for determination on a case-by-case basis. As the Alaska Supreme Court noted:
" 'A state supreme court has unfettered discretion to apply a particular ruling either purely prospectively, purely retroactively, or partially retroactively, limited only "by the juristic philosophy of the judges * * *, their conceptions of law, its origin and nature.” The decision is not a matter of law but a determination based on weighing the merits and demerits of each case. Consideration is given to applying a ruling prospectively "whenever injustice or hardship will thereby be averted.” ’ Warwick v State ex rel Chance, 548 P2d 384, 393-394 (Alas, 1976).” Jones v Watson, 98 Idaho 606, 608; 570 P2d 284 (1977).
See, also, State ex rel Washington State Finance Committee v Martin, 62 Wash 2d 645, 673; 384 P2d 833, 849 (1963). This Court has also recognized the principle,
"This Court has overruled prior precedent many times in the past. In each such instance the Court must take into account the total situation confronting it and seek a just and realistic solution of the problems occasioned by the change.
"It is evident that there is no single rule of thumb which can be used to accomplish the maximum of justice in each varying set of circumstances. The involvement of vested property rights, the magnitude of the impact of decision on public bodies taken without warning or a showing of substantial reliance on the old rule may influence the result.” Williams v Detroit, 364 Mich 231, 265-266; 111 NW2d 1 (1961) (opinion of Justice Edwards in which Justices Talbot Smith, T. M. Kavanagh and Souris concurred).
The benefit of flexibility in opinion application is evident. If a court were absolutely bound by the traditional rule of retroactive application, it would be severely hampered in its ability to make needed changes in the law because of the chaos that could result in regard to prior enforcement under that law. When this Court overruled the doctrine of imputed negligence in Bricker v Green, 313 Mich 218, 236; 21 NW2d 105 (1946), that decision was applied to pending and future cases. Without the flexibility to so apply the decision, it would be unlikely that much needed change could be effectuated in this state.
We now turn to the question of the proper application in the instant case. In Kirby, supra, 645, the Williams opinion would have followed a course of applying comparative negligence, "* * * to the instant case and all cases filed after the date of this decision, where the negligence of plaintiff is an issue * * For two reasons we now find a slightly broader application to be proper.
First, affording limited retroactive effect to the better rule of comparative negligence will not unjustly burden litigants of this state. The limited retroactive application in Bricker, supra (to pending as well as future cases), could not work a hardship because there could be no detrimental reliance on the doctrine of imputed negligence. By way of contrast, in Parker v Port Huron Hospital, 361 Mich 1; 105 NW2d 1 (1960), this Court overturned the doctrine of charitable immunity. We refused to give that decision any retroactive effect because of possible detrimental reliance placed upon that doctrine by charitable hospitals.
"In the interests of justice and fairness, in view of the new ruling and the reliance that some, albeit few, charitable, nonprofit hospital corporations may have placed on the old ruling, and may have failed to protect themselves by the purchase of available insurance, we believe the new rule should apply to the instant case and to all future causes of action arising after September 15, 1960, the date of the filing of this opinion.” Parker, supra, 28.
Unlike Parker, no similar injustice could result by according some retroactive effect to the instant decision.
It is the second and we believe more unique factor, however, which encourages us to accord a limited retroactive application similar to that ac corded by the three other state supreme courts faced with this specific issue.
Since July, 1977, the bench and bar of this state have had clear notice that three Justices of this Court were ready to adopt comparative negligence and that three others might be willing in another case. Since the issuance of Kirby, members of the bar of this state have diligently argued the issue on behalf of their clients. At this Court alone we presently have three cases being held pending this decision in which comparative negligence was raised and argued. If no retroactive application is -accorded our decision today, the fortuity that the instant plaintiffs’ case was the first to arrive at this Court would be the sole determinant of who would benefit from the fairer doctrine of comparative negligence. This would be true despite the fact that many litigants had exercised the same diligence exercised by the instant plaintiffs in raising the issue.
Therefore, we hold the rule announced today applicable to the instant case and all appropriate cases in which trial commences after the date of this opinion including those in which a retrial is to occur because of remand on any other issue. Further, we find comparative negligence applicable to any case presently pending on appeal in which application of the doctrine was requested at the trial court and the issue preserved for appeal. Finally, comparative negligence shall be the applicable rule in any case commenced but not submitted to the trier of fact prior to the date of this decision, but in no case shall it apply unless there is an appropriate request by counsel prior to submission to the trier of fact.
IV. Instruction on Plaintiff’s Duty of Care
The trial court gave the following instruction to the jury regarding plaintiffs duty of care:
"Now, I want to instruct you jurors that the Supreme Court has said that a so-called right of way is not an assurance of safety, and does not grant an absolute right of way under all conditions. The driver on the street who does have a so-called right of way is still required to exercise due care in driving his car, or her car, in view of the conditions as they existed at that time. The driver on a favored highway, the superior highway, has a right to assume that other drivers will obey properly erected traffic signs, but you must keep in mind here that this accident is with an authorized emergency vehicle which had a right under certain conditions to violate an erected traffic sign. The driver on a through highway may not proceed blindly. The driver is required to remain alert to hazards on the highway and to make reasonable observations of other drivers approaching the intersection and must keep such lookout ahead and to the sides of intersecting highways as a reasonably, prudent, careful person would do in order to discover possible dangers, and he must act carefully with the same care that the ordinary careful and prudent person would act upon the existing conditions that then existed. ” (Emphasis added.)
At trial plaintiffs counsel objected to the instruction on the ground that plaintiff
"had no duty to look to either direction, but had a right to assume other vehicles were going to assume [sic] her the right of way until she knew or should have known that another vehicle was going to interfere with her right of way.”
There are several statutes relevant to the resolution of this issue. One is MCL 257.649(f); MSA 9.2349(f), which gives the driver on a through street the right of way paramount to a driver traveling on a stop street,
"Except when directed to proceed by a police officer, the driver of a vehicle approaching a stop intersection indicated by a stop sign shall stop before entering the crosswalk on the near side of the intersection * * *.” (Emphasis added.)
Cases interpreting this statute have held that the standard of care to which the favored driver (driver with the right of way) must adhere is a standard of reasonable or due care under the circumstances. See Koehler v Thom, 285 Mich 593, 598; 281 NW 336 (1938); Beauchamp v Olsen, 42 Mich App 323, 325; 201 NW2d 677 (1972). What is reasonable on the part of the favored driver has been further refined.
”[T]he operator of an automobile proceeding through an intersection controlled by a traffic signal is under no duty to make an independent determination as to whether the traffic approaching a red light will stop. In such a situation the operator of an automobile is not required to observe traffic approaching a red light to determine whether it is safe to proceed. The driver can justifiably rely on what all have come to expect — that traffic approaching a red light will stop.” Buchholtz v Deitel, 59 Mich App 349, 352; 229 NW2d 448 (1975). (Emphasis added.)
This reliance, of course, does not absolve the favored driver from the need to exercise due care. See Beauchamp v Olsen, 42 Mich App 323; 201 NW2d 677 (1972).
Other statutes must also be considered when, as in the instant case, there is an authorized emergency vehicle involved. MCL 257.653; MSA 9.2353 states in relevant part,
"(a) Upon the immediate approach of an authorized emergency vehicle * * *
"1. The driver of every other vehicle shall yield the right of way * * *
"(b) This section shall not operate to relieve the driver of an authorized emergency vehicle from the duty to drive with due regard for the safety of all persons using the highway. ” (Emphasis added.)
Further, MCL 257.603; MSA 9.2303, states in relevant part,
"(c) The driver of an authorized emergency vehicle may:
"2. Proceed past a red or stop signal or stop sign, but only after slowing down as may be necessary for safe operation.
"3. Exceed the prima facie speed limits so long as he does not endanger life or property.” (Emphasis added.)
Under these statutes it is clear that defendant, like plaintiff, is not absolved of the duty to drive "* * * with due regard for the safety of others * * Kalamazoo v Priest, 331 Mich 43, 48; 49 NW2d 52 (1951). Neither plaintiff nor defendant, therefore, had an absolute right to proceed blindly.
We must now determine if the instruction as framed by the trial court correctly set forth the law as to plaintiffs duty of care.
In 1937 this Court was faced with a case similar to the one at bar, Lansing v Hathaway, 280 Mich 87; 273 NW 403 (1937). In that case a fire truck owned by the city of Lansing proceeded through a red stop light while on an emergency run. The fire truck was struck by defendant’s vehicle which was proceeding under benefit of a green light. The city brought suit to recover its damages in repair of the truck and cure of the injured firefighters. The visibility was reduced in that case by a severe rain storm.
The plaintiff city appealed a bench trial judgment in favor of defendant.
This Court, relying on a city ordinance which was consistent with the present statutes on emergency vehicles, set forth the applicable standard.
"We assume, for the purposes of decision, that, under the city ordinance, the fire truck, as an emergency vehicle responding to a fire alarm, had a right to run the red light upon giving 'audible signal’ and having reasonable regard for the safety of others. Defendant had a right, under permission of the green light, to cross the intersection unless, by the reasonable exercise of the senses of sight and hearing, he should have noticed or heard warning to the contrary.” (Emphasis added.) Hathaway, supra, 89.
This same standard was upheld by this Court in Holser v Midland, 330 Mich 581, 584; 48 NW2d 208 (1951), and by the Court of Appeals in Keevis v Tookey, 42 Mich App 283, 287; 201 NW2d 661 (1972).
We again affirm the correctness of the Hathaway standard to the effect that the driver travel ing on a through street, as against an emergency vehicle, has a right to cross the intersection unless, by the reasonable exercise of the senses of sight and hearing, he or she should have noticed or heard warning to the contrary.
As quoted above, in instructing as to plaintiffs duties, the court stated:
"The driver on a through highway may not proceed blindly. The driver [Placek] is required to remain alert to hazards on the highway and to make reasonable observations of other drivers approaching the intersection and must keep such lookout ahead and to the sides of intersecting highways as a reasonably, prudent, careful person would do in order to discover possible dangers, and he must act carefully with the same care that the ordinary careful and prudent person would act upon the existing conditions that then existed.”
We find the instructions on the whole to be unfairly and erroneously weighted against plaintiff.
Under the law of this state, plaintiff could proceed unless, by the reasonable exercise of sight and hearing, she should have noticed or heard warning to the contrary. Hathaway, supra, 89. Reasonable exercise includes a duty to be "fairly alert as to potential dangers that may be readily seen or heard”. Holser, supra, 584. There is a discernible difference between remaining fairly alert to readily cognizable potential dangers which she should have noticed or heard under Holser and Hathaway, and being "required to remain alert to hazards”. While the specific language "required to remain alert to hazards” appears in Krause v Ryan, 344 Mich 428; 74 NW2d 20 (1955), the language in Krause is simultaneously tempered by other language similar to that required by Hathaway. In the instant case there was no such tempering to place plaintiff’s duty in the proper perspective.
Similarly, authority for the trial court’s instruction that the favored driver,
"* * * must keep such lookout ahead and to the sides of intersecting highways as a reasonably prudent careful person would do in order to discover possible dangers, and he must act carefully with the same care that the ordinary careful and prudent person would act upon the existing conditions, that then existed” (emphasis added),
appears in the case of Arnold v Krug, 279 Mich 702, 708; 273 NW 322 (1937). Again, however, the language only appears within the context of other qualifying language.
Adding to the unfair impact of the instruction regarding plaintiffs duties is the fact that the trial court stated in relation to plaintiff and in the course of the objected-to instruction, that the "driver on a through highway may not proceed blindly”. Although the same is true as the law of this jurisdiction applies to the driver of an emergency vehicle, no similar instruction was given as to defendant.
We find the instructions as given constitute error because they unfairly represent the law as to plaintiffs duties. The fact that they do not suffi ciently define defendant’s duties is not a specific basis for this appeal and is merely noted to preclude similar error and further prolongation of this litigation.
V. Defendant’s Negligence
Prior to the trial court’s submission of the instant case to the jury, counsel for plaintiffs moved for a directed verdict on the issue of defendant’s negligence. The motion was denied by the trial court.
Plaintiffs claim at this Court that the denial of this motion constituted error because the evidence presented below clearly established that the defendant failed to exercise due care prior to entering the intersection. Plaintiffs contend that this negligence is evidenced by defendant’s excessive speed and by defendant’s act of merely glancing to his right and then observing only the Woods’ vehicle. This issue need not long detain us.
It is clear from the testimony that the speed at which defendant Ernst was traveling is in dispute. Virginia Woods testified that defendant was exceeding the 35-mile-per-hour speed limit, Cabell Woods testified that defendant was traveling at 40 miles per hour, and Officer Ernst told Officer James Porter, the investigating officer at the scene of the accident, that he was traveling at 30 miles per hour. (See Part I, supra.)
Further support for a finding of the existence of a dispute as to both speed and whether defendant did reasonably attempt to observe the surrounding traffic is found in the deposition of defendant Ernst which was read into the record at trial. During that deposition, the following exchange occurred:
"Q. * * * Now, when you entered the intersection did you make an observation of the intersection before you entered it to see if there was any other traffic approaching either from the east or west on Plumbrook?
”A. I observed the intersection as a whole, yes, sir.
"Q. And all you saw was this one car?
"A Yes, sir.
”Q. Now, as you entered the intersection did you make an observation to the right or to the left to see if there was any traffic approaching?
’A. I was primarily interested in that car [Woods’ vehicle]. No traffic to the left, or southwest of Schoen herr on Plumbrook, and I was primarily interested to make sure that this car that was at the stop sign remained stopped, wouldn’t pull out in front of me any further.
”Q. Did you make an observation as you entered the intersection to the right to see if there was any other traffic approaching from the west traveling east on Schoenherr?
"A. Yes, sir.
”Q. Let me ask you this: When you stated you were slowing down to enter the intersection of Plumbrook, knowing that Plumbrook was a through street, how much did you slow your car down to?
"A. Like I say, a rolling speed.
”Q. What would that be, rolling speed?
"A. 5 miles, 6, 8 miles an hour, something like that.
”Q. As you approached this intersection of Plumbrook you decelerated your car, braked your automobile until you got down to a speed where you could stop if there was any traffic coming from the east or west on Plum-brook?
"A. Yes, sir.
"Q. Approximately?
"A. Hard to say, 8, 10 miles an hour, somewhere in there, just a rough estimate.
”Q. But it wasn’t 30 miles an hour?
"A. To my knowledge, no, sir.”
Although it is undisputed that defendant did not observe plaintiffs’ vehicle, there remains a question of fact as to whether the failure to observe plaintiffs’ car constituted negligence because of the existence of another potential danger — the Woods’ vehicle.
Plaintiffs claim however, under authority of Kalamazoo v Priest, 331 Mich 43; 49 NW2d 52 (1951), that defendant’s negligence is established. In Priest, the city sued a driver who had collided with a fire truck under circumstances similar to the instant case except for the fact that the firefighter driving the truck had seen defendant’s car and had sped up in an effort to pass ahead and avoid the accident. Based on the defense of contributory negligence, the trial court directed a verdict in favor of defendant. This Court affirmed because
"plaintiffs driver did not make proper observation nor see seasonably what was plainly there to be seen so as to be able to form a reasonable belief as to whether he could proceed into the intersection in safety.” Priest, supra, 47.
The emergency vehicle statute operative in Priest required the exercise of due regard for the safety of others; plaintiff’s driver, as a matter of law, was held to have violated that statute.
"Inasmuch as the statute has not relieved drivers of fire trucks from the same duties to maintain a lookout, to see and heed what is present to be seen, and, on the basis of such observation, to form a reasonable belief that it is safe to proceed, it follows inescapably that plaintiffs driver must likewise be held to have been guilty of contributory negligence as a matter of law, barring plaintiffs right to recovery.” Priest, supra, 48.
We find Priest distinguishable on two grounds. First, in the instant case there remains a question of fact as to the speed at which defendant was traveling. The issue of defendant’s speed is part of plaintiffs’ proofs as to defendant’s negligence. Second, as stated above, there remains a question of fact as to whether the failure to observe plaintiffs’ vehicle was negligent because defendant was focus ing his attention on the Woods’ vehicle which could rightfully be considered a potential danger.
We, therefore, agree with the trial court as to this issue. We cannot say, as a matter of law, that defendant breached his duty to proceed with due regard for the safety of others. The issue must be determined by the trier of fact.
VI. Conclusion
The doctrine of contributory negligence in Michigan is hereby replaced with the more just and -equitable doctrine of comparative negligence to be applied in the limited retroactive manner discussed in Part III C, supra.
We find error in the trial court’s jury instruction as to plaintiffs duty of care but affirm the decision of the trial court that defendant’s negligence is a question of fact to be decided by the trier of fact.
Reversed and remanded for new trial. Costs to plaintiffs.
Levin and Blair Moody, Jr., JJ., concurred with Williams, J.
As a matter of terminology we replace the doctrine of contributory negligence. In actuality, however, it is contributory negligence as a total bar to recovery which is replaced. The effect of this action is to establish contributory negligence as a partial bar to recovery by insuring that any recovery of damages by a plaintiff be reduced to the extent of his or her own negligent contribution to the injury.
Butterfield v Forrester, 11 East 60; 103 Eng Rep 926 (1809). The "checkered” history of the doctrine of contributory negligence is discussed in the Williams opinion in Kirby v Larson, 400 Mich 585, 613-623; 256 NW2d 400 (1977).
Wade, A Uniform Comparative Fault Act — What Should It Provide?, 10 U of Mich J of L Reform 220, 221 (1977) (hereinafter cited as ,Wade).
Id.
Pope & Talbot, Inc v Hawn, 346 US 406, 408-409; 74 S Ct 202; 98 L Ed 143 (1953); Alaska, Kaatz v State, 540 P2d 1037 (Alas, 1975); Arkansas, Ark Stat Ann, §§27-1763 to 27-1765; California, Li v Yellow Cab Co of California, 13 Cal 3d 804; 532 P2d 1226; 119 Cal Rptr 858 (1975); Colorado, Colo Rev Stat, § 13-21-111; Connecticut, Conn Stat Ann, § 52-572h (Supp 1978); Florida, Hoffman v Jones, 280 So 2d 431 (Fla, 1973); Georgia, Ga Code Ann, § 105-603; Hawaii, Hawaii Rev Stat, § 663-31; Idaho, Idaho Code, §§ 6-801, 6-802 (Supp 1978); Kansas, Kan Stat Ann 60-258a; Maine, Me Rev Stat Ann, tit 14, § 156 (Supp 1978-1979); Massachusetts, Mass Gen Laws Ann, ch 231, § 85 (Supp 1978); Minnesota, Minn Stat Ann, § 604.01 (Supp 1978); Mississippi, Miss Code Ann, § 11-7-15; Montana, Rev Codes Mont, § 58-607.1 (Cum Supp 1977); Nebraska, Rev Stat Neb, § 25-1151; Neveda, Nev Rev Stat, § 41.141; New Hampshire, N H Rev Stat Ann 507:7-a (Supp 1977); New Jersey, NJ Stat Ann 2A:15-5.1—2A:15-5.3 (Supp 1978-1979); New York, NY Civ Prac, § 1411 (McKinney 1976); North Dakota, N D Cent Code, § 9-10-07; Oklahoma, Okla Stat Ann, tit 23, § 11 (Supp 1978-1979); Oregon, Ore Rev Stat 18.470; Pennsylvania, Pa Stat Ann, tit 17, §§ 2101, 2102 (Purdon, Supp 1978-1979); Rhode Island, RI Gen Laws, § 9-20-4 (Supp 1977); South Dakota, S D Comp Laws, § 20-9-2; Texas, Vernon’s Tex Ann Civ Stat, art 2212a, § 1 (Supp 1978-1979); Utah, Utah Code Ann 78-27-37; Vermont, Vt Stat Ann, tit 12, § 1036; Washington, Rev Code Wash Ann 4.22.010 (Supp 1978); Wisconsin, Wis Stat Ann 895.045 (Supp 1978-1979); Wyoming, Wyo Stat, § l-7.2(a) (Supp 1975).
Also, although South Carolina is not generally a comparative negligence state, the doctrine has been enacted on a limited basis for automobile negligence cases. S C Code, § 15-1-300.
Defendants challenge whether comparative negligence was properly raised in the instant case. Plaintiffs apparently raised the issue for the first time during the second trial in this matter, in which the following exchange occurred:
"Mr. Miller [plaintiff’s attorney]: For the record, I had another motion I wanted to take up, which was, I would move to strike Mr. Zotter’s answers, or opening statement concerning the law on contributory negligence, as I would ask the court to apply comparative negligence in this case, and I would assume that would be rejected, but I would like to place it on the record and keep it there should it ever become necessary. That is what the law should be and this is a perfect case for it, Judge.
"The Court: Well—
"Mr. Zotter: I oppose it, your Honor.
"The Court: Even though I might agree with you I have to deny it.”
Subsequent to jury instructions, plaintiff’s counsel made the following objection:
"The Court: All right, gentlemen. Now you can protect yourself from here to there on the record.
"Mr. Miller: I would first object, your Honor, to the charge of contributory negligence. I requested a charge over comparative negligence which the court is aware of.
"The Court: Yes.
"Mr. Miller: That we can pass on, I assume. I hope it won’t be necessary, but preserve it.”
On appeal to the Court of Appeals, plaintiff raised the same three issues raised before this Court, including whether a comparative negligence system should be adopted in this state.
We find the issue properly raised and preserved for our consideration.
There has been some discussion in legal literature regarding whether substitution of comparative negligence for contributory negligence is necessary in a state in which a no-fault insurance act is in effect. Schwartz, Comparative Negligence (Indianapolis: Allen Smith Co, 1974), § 1.6, pp 28-29; Sherman, An Analysis of Pennsylvania’s Comparative Negligence Statute, 38 U Pittsburgh L Rev 51, 56-57 (1976). We agree with the conclusions reached by both authors that the existence of a no-fault act does not preclude the necessity for the substitution.
"Even in states that adopt a 'no-fault system,’ comparative negligence cap be an important part of the law for at least two reasons. First, the well-known no-fault plans apply only to motor vehicle cases. Cases involving slip and fall, product liability, or plane, boat, or train accidents will not be affected. Second, most no-fault plans that have proved of interest to legislators retain the fault system for damages exceeding specified limits.” (Footnote omitted.) Schwartz, pp 28-29.
See discussion in the appendix to the Williams opinion in Kirby, 656-658.
Kavanagh, C.J., and Williams and Levin, JJ.
Justice Blair Moody, Jr., did not participate.
This topic has occasioned much comment. See, e.g., Fleming, Foreword: Comparative Negligence at Last — By Judicial Choice, 64 Calif L Rev 239, 241, 273-282 (1976); Am Jur 2d, New Topic Service, Comparative Negligence, § 7 (1977); Schwartz, Comparative Negligence, §§ 21.6, 21.7, pp 353-361; 78 ALR3d 421.
Even earlier notice of impending change was presented in the Williams opinion in Vanderah v Olah, 387 Mich 643, 659-661; 199 NW2d 449 (1972). Further, the notice provided by Kirby has apparently been heeded by litigants in Michigan, see fn 13, infra, and accompanying text.
Of course, as noted in footnote 54 in the Williams opinion in Kirby, 642, the Legislature in this state "has the power to reinstate contributory negligence or to modify this rule of comparative negligence”.
See the appendix for alternative suggested jury instructions and special verdict forms.
This is not to say that some liability will not be created where none existed before. The fact that new liability may exist is unrelated to the problem of detrimental reliance on prior decisions of this Court.
By order of March 29, 1978, Castonia v JD Smith, Lake Region Development Co (Docket No. 60401) is being held; by order of April 5, 1978, the Estate of Dixon v The Young Men’s Christian Ass’n (Docket No. 60728) is being held; by order of May 24, 1978, Turri v Bozek (Docket No. 60632) is being held.
Defendant attempts to distinguish "traffic light” cases from "stop sign” cases. Our research, however, has led us to no authority holding that there is a valid basis for distinction between these two means of traffic control. If anything, it would appear that a right of way existing under authority of a green light is less reliable from a driver’s viewpoint because the street with the right of way is continuously changing. In contrast, placement of a stop sign on only one of two intersecting streets is tantamount to a declaration that one street is always dominant.
In Krause the quoted language appears within the context of the following paragraph:
"The driver on the arterial, we have decided, is the favored driver. It is not necessary in approaching an intersection, as we said in Arnold v Krug [279 Mich 702, 707; 273 NW 322 (1937)], that he 'have his car under such control * * * that he may stop at once and avoid collision with persons who may illegally come into his path.’ Lacking notice otherwise, he may assume that others using the highways will comply with the rules of the road and properly posted signs and he is not guilty of contributory negligence in acting upon such assumption. It should not, however, be assumed from the foregoing that he may proceed blindly upon the arterial, secure in the supposition that he can do no wrong. He must remain alert to the hazards surrounding him and with which he is confronting others.” (Emphasis added.) Krause, supra, p 432.
In Arnold, this Court stated prior to the language quoted in the instruction,
"The right of way accorded to a driver upon a trunkline highway is something more than the privilege of going through the intersection in advance of a car which reaches it at the same time. Drivers approaching the trunkline are required to stop before entering the intersection whether anyone is at or near the crossing or in sight on the trunk highway. It is an improved road — usually hard surfaced. Its purpose is to afford rapid transit. The driver is entitled to assume that those approaching it will obey the law and stop. He is not obliged to have his car under such control at each intersecting road that he may stop at once and avoid collision with persons who may illegally come into his path.” (Emphasis added.) Arnold, supra, p 707.
Subsequent to the instructed language,
"A driver cannot be convicted of negligence on a general charge that he did not exercise the care a prudent person would have used under the circumstances. It is necessary to charge and prove the specific act he did or did not do. Wallace [the driver of defendant’s truck] was driving on the right side of the road at a very reasonable rate of speed and with his truck under control. The only claim of fault which could be made against him, and which the court found, is that he failed to reduce his speed as he neared the intersection. But to what rate should he have reduced the speed? It is evident that, to have avoided the collision, he would have had to so slacken his speed that he could have stopped well within 30 feet. To impose such a duty on drivers upon trunkline highways would seriously impair their purpose, be foreign to the general conception of careful drivers of their rights and duties upon them, in large measure destroy the preferential right of way, and offer inducement to drivers approaching on intersection roads to violate their legal duties. It is not the rule as a matter of law.
"Nor as a matter of fact was such duty to slacken speed imposed on Wallace. He was obliged to anticipate such possible danger in the intersection and do such acts to avoid it as a reasonably prudent person would have anticipated and done, if such person had the knowledge of the situation which Wallace possessed and had the right to assume that one about to enter the trunk highway at the intersection would perform his legal duty to stop and look for traffic.” Arnold, supra, p 708.
Read within the context of its surrounding language, the words employed in the instruction are greatly qualified.
In dissent to our finding of error, Chief Justice Coleman finds that plaintiff’s position was fairly communicated. As support for her conclusion she quotes the following statement of the trial judge made during his charge to the jury:
"It is the plaintiff’s claim further that the defendant here, Mr. Ernst, must establish by convincing evidence that the plaintiff knew, or should have known, of the approach of the police car under the circumstances that she was confronted with.
"It is the plaintiff’s theory that at all times * * * [she] acted as a “reasonable, prudent person would have acted under the same or similar circumstances * * (Emphasis added.)
We cannot agree because we do not equate a trial judge’s statement of plaintiffs theory of the case (which is exactly what the above quoted language is) with an instruction as to the law. The trial judge in the case at bar agreed that there is a vast distinction between these two. After instructing as to the theories and the general duties of the jurors, the judge stated, "[n]ow, what we are just beginning to enter now, the important part of the instructions * * *” (emphasis added). The judge then proceeded to instruct as to the legal definitions and duties. It is the latter "important” portion in the instructions which we find to constitute error.
Further as added support for finding plaintiffs position fairly communicated, the dissent states,
"Finally, the trial judge did instruct that the plaintiff was driving on a 'superior highway’ and that
" '[t]he driver on a favored highway, the superior highway has a right to assume that other drivers will obey properly erected traffic signs * * *.’ (Emphasis added.)
"These instructions fairly informed the jury of the plaintiffs rights as a favored driver.”
This quotation, however, omits the second half of the instructed sentence. The full sentence reads as follows:
"The driver on a favored highway, the superior highway, has a right to assume that other drivers will obey properly erected traffic signs, but you must keep in mind here that this accident is with an authorized emergency vehicle which had a right under certain conditions to violate an erected traffic sign.” (Emphasis added.)
We do not question that the trial judge must instruct as to defendant’s rights, but this had already been fully accomplished and repetition within the above context stripped the language as to plaintiffs rights of its proper impact.
Under these circumstances, we are convinced that the instructions in the instant case were so unfairly weighted against plaintiff as to constitute reversible error. | [
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Introduction
Williams, J.
The principal issue in this case was whether the jury could properly find first-degree murder, premeditation and deliberation, from the evidence presented. The defendant, Mr. Tilley, was charged with the first-degree murder of Mr. Mickel, an off-duty sheriff’s deputy. The shooting followed an altercation outside a restaurant. During the struggle the defendant obtained possession of Mickel’s gun. Five or six shots were fired by the defendant at Mickel, some in the parking lot, and others in the vestibule of the restaurant where the victim had retreated. • •
The defendant was convicted by a jury of firstdegree murder. The Court of Appeals affirmed. 70 Mich App 18; 245 NW2d 389 (1976). We granted leave to appeal. We hold there was evidence upon which the trier of fact, the jury, could have based its verdict.
We affirm.
Facts
On Sunday, November 29, 1973, at approximately 2:30 a.m., the defendant entered the Nugget Restaurant. A friend of the defendant’s, Mr. Moss, entered the restaurant and started an argument with the victim. At the time Mr. Mickel was wearing civilian clothes. Moss and Mickel left the restaurant followed by Tilley and some other restaurant patrons. Once they were outside, the argument between Mickel and Moss continued. Moss pulled a gun from his pocket, which Mickel knocked to the ground. Mickel picked up Moss’s gun and drew his own revolver; he placed Moss under arrest and identified himself as a Wayne County Sheriffs Deputy.
The crowd which had gathered questioned Mickel’s authority. Mr. Toth, a restaurant bouncer, approached both men. Mickel showed Toth his badge and said he had everything under control. Toth went back into the restaurant and, as requested by Mickel, called the local police. The crowd continued to ask for Mickel’s identification. Tilley began speaking to Mickel in a taunting manner. This distraction enabled Moss to turn and jump Mickel, who then struck Moss with his gun hand. The three men, Tilley, Moss and Mickel, began to struggle, during which time Tilley obtained possession of Mickel’s gun. One witness testified that after Tilley gained possession of the gun both Tilley and Moss held Mickel.
At this point Mickel began to back towards the restaurant. Tilley began shooting. Five or six shots were fired at Mickel. Some were fired in the parking lot, and others in the vestibule of the restaurant where Mickel had retreated with Tilley in pursuit.
The testimony of the witnesses varied as to the time lapse between Tilley obtaining possession of the gun and the first shots. There was also variátion in the testimony as to the time lapse between the first and the final shots. The variance ranged from one second to one minute for each of the two intervals. There was also testimony presented that the defendant held the gun with two hands while pointing it at Mickel during the first volley, that he dropped his hands while running after Mickel and had to raise the gun in order to fire the final volley of shots.
Factual Analysis
We examine the totality of the circumstances to determine whether there is evidence to support the findings of the trier of fact; in particular whether the findings of premeditation and deliberation are supported.
In People v Wolf, 95 Mich 625; 55 NW 357 (1893), this Court did examine the circumstances surrounding a homicide in determining whether premeditation and deliberation were present. In People v Bauman, 332 Mich 198; 50 NW2d 757 (1952), the same type of factual analysis was reaffirmed. The majority of decisions by this Court involving first-degree murder have been based on such factual analyses of the totality of the circumstances.
A careful review of the testimony in this case persuades us that there was evidence to support the jury’s verdict. For purposes of illustration we list several factors surrounding the homicide which support the jury’s verdict. We do not intend to imply that any one particular factor is essential to a finding of premeditation and deliberation, but that only by reviewing the circumstances as presented through the testimony of the witnesses can a determination be made.
First, we realize when a homicide occurs during a sudden affray this Court has found that it would be "a perversion of terms to apply the term deliberate to any act which is done on a sudden im pulse”, Nye v People, 35 Mich 16, 19 (1876). In this case the testimony presented allows the jury to find that the fighting had ended when (1) Tilley obtained possession of the gun or (2) Mickel began retreating. There was also testimony that Tilley and Moss were in control of the situation, holding Mickel, before Tilley started shooting.
A second consideration is the time required to premeditate and deliberate. In People v Vail, 393 Mich 460; 227 NW2d 535 (1975), this Court said:
"While the minimum time necessary to exercise this process is incapable of exact determination, the interval between initial thought and ultimate action should be long enough to afford a reasonable man time to subject the nature of his response to a 'second look.’ ” Vail, 469.
There was an interval between Tilley securing possession of the gun and the first volley of shots as Mickel was retreating. The testimony presented various estimates of the time lapse ranging from one second to one minute.
Third, there was testimony that Tilley followed Mickel after the first volley of shots as Mickel continued retreating, creating a time lapse between the first and second volley. Witnesses also testified that after following Mickel through the doorway of the restaurant Tilley had to raise the gun before firing the second volley of shots.
We recognize that "[s]ome time span between initial homicidal intent and ultimate action is necessary to establish prerheditation and deliberation”, People v Hoffmeister, 394 Mich 155, 161; 229 NW2d 305 (1975). The jury had evidence to sup port the conclusion that the defendant had ample opportunity to premeditate and deliberate.
In addition, there was testimony of another kind indicating premeditation and deliberation. It was that Tilley was holding the gun with two hands when he pointed it at Mickel.
Conclusion
Based on the facts of this case presented through the testimony of the witnesses, there was evidence to support the verdict of the jury.
We affirm the conviction of the defendant of first-degree murder.
Coleman, C.J., and Fitzgerald, Ryan, and Blair Moody, Jr., JJ., concurred with Williams, J.
While the jury charge was not an issue in this case, it is a fact that the trial court charged the jury that "the interval between initial thought and ultimate action should be law [sic] enough to afford a reasonable man time to subject the nature of his response to a 'second look’ ”. | [
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Ryan, J.
We granted leave in this case, together with Michigan Gas Storage Co v Public Service Commission, ante, 405 Mich 376; 275 NW2d 457 (1979), to determine whether the Michigan Public Service Commission may properly exercise jurisdiction over the securities of certain companies under MCL 460.301; MSA 22.101. In Michigan Gas Storage we held that jurisdiction did exist in the circumstances involved in that case and that it could properly be exercised. Although the Federal regulatory framework applicable to Indiana and Michigan Power Company (Power Company) is different from the one involved in that case, we reach the same conclusion and, accordingly, reverse the decision of the Court of Appeals.
I
Power Company is a corporation organized and existing under the laws of the State of Michigan, having its principal office in the state at the Donald C. Cook Nuclear Plant, Bridgman, Michigan.
The Michigan Public Service Commission (the Commission or PSC) is an administrative agency of the State of Michigan.
Power Company filed certain applications with the Commission seeking approval or a disclaimer of jurisdiction of certain planned security issuances. The Commission approved the proposed transaction and ordered Power Company to pay to the State of Michigan the statutory fee prescribed by MCL 460.61; MSA 22.11.
Seeking a refund of the security issuance fee, Power Company filed the instant suit in the Court of Claims on September 21, 1972. Power Company and the Commission entered into a stipulation of facts in the Court of Claims. The stipulation established that Power Company was organized solely to acquire, to complete construction of, and to operate the Donald C. Cook Nuclear Electric Generating Plant. To acquire and finance construction of the plant, the company was required to issue securities • in substantial amounts. The aforementioned applications to the Commission were filed and the issuances were approved.
All of the outstanding capital stock in Power Company is owned by Indiana and Michigan Electric Company (Electric Company). Under a "power agreement” entered into between Power Company and Electric Company, Power Company will, upon commencement of operation of the generating plant, sell to Electric Company all of the electric power - generated there. Electric Company will be Power Company’s only customer and will receive delivery of the electricity at the site of the plant at Bridgman.
Power Company’s parent, Electric Company, is a corporation organized under the laws of the State of Indiana and having its principal office in that state. It is engaged in the generation, purchase, transmission, distribution and sale of electricity at retail in the states of Michigan and Indiana. Electric Company is a public utility under the laws of both states, each of which regulates the rates of the company’s retail sales within its borders.
Electric Company also sells electricity at wholesale for resale to other electric companies in Indiana, Michigan, Illinois and Ohio. These sales at wholesale for resale by Electric Company were subject to the exclusive regulatory jurisdiction of the Federal Power Commission (FPC) under the Federal Power Act, as amended, 16 USC 791a et seq. At the time this case was initiated, the FPC was the regulatory authority under the Federal Power Act. Under 42 USC 7101 et seq., the Department of Energy Organization Act, the functions of the FPC were transferred to the Department of Energy and the Federal Energy Regulatory Commission. Under that act the FPC regulated Electric Company’s wholesale rates and its services and facilities. In addition, the rates at which Electric Company purchases electricity from Power Company were also to be regulated by the FPC.
All of the outstanding stock of Electric Company is in turn owned by American Electric Power Company, Inc. (American), a New .York corporation with its principal place of business in New York City. American is a public utility holding company owning all of the common stock of various electric utility companies operating in the statés of Ohio, Indiana, Michigan, Virginia, West Virginia, Kentucky and Tennessee. These subsidiaries are physically interconnected and are operated and coordinated as a single, integrated electric utility system. As a registered public utility holding company under the Public Utility Holding Company Act of 1935 (PUHCA), 15 USC 79 et seq., American and its subsidiaries, including Power Company, are subject to the jurisdiction of the Securities and Exchange Commission. See the discussion, infra.
With respect to the security issues involved in this case, Power Company filed, in addition to the applications filed with the Public Service Commission, declarations (see the discussion, infra) with the SEC pursuant to §6 of the PUHCA, 15 USC 79f. The SEC issued orders permitting the declarations to become effective.
Following the decision and orders of the Michigan Public Service Commission, Power Company paid the statutory issuance fees under protest and filed the instant suit.
On August 4, 1975, the Court of Claims entered a judgment granting a refund of $431,500 to Power Company. Appellants, State of Michigan and the Commission, appealed to the Court of Appeals which affirmed the decision of the Court of Claims. Indiana & Michigan Power Co v Public Service Commission, 72 Mich App 398; 249 NW2d 429 (1976).
We granted leave to appeal. 400 Mich 805 (1977).
II
As we stated in Michigan Gas Storage, supra, the Court of Appeals held in these two cases, as we read their opinions, "that the Michigan Legislature intended securities regulation in MCL 460.301; MSA 22.101 to be ancillary to the Commission’s regulatory jurisdiction over rates, services and facilities pursuant to MCL 460.6; MSA 22.13(6)”. 72 Mich App 398, 409.
In Michigan Gas Storage we stated that we did not so read the legislative intent. We reaffirm that opinion here.
Power Company readily admits that regulation of the securities issuances was motivated by the evils and injurious effects on the public of overcapitalization. It argues, however, as did Michigan Gas Storage Company in the related case, that the capital structure of the company is an essential element in its rate structure, that rate and securities regulation are inextricably tied together, and that the Legislature would not have intended to exercise jurisdiction over securities where it was not asserting similar authority over rates.
Briefly, we are convinced that securities regulation was intended to, and does, protect interests which rate regulation alone could not effectively control. It serves the interests of both the investors in, and creditors of, a company organized and operating and issuing securities under the laws of this state and those of ratepayers in efficient and uninterrupted service at reasonable rates. People v County Transportation Co, 303 NY 391; 103 NE2d 421 (1952), app dis 343 US 961 (1952). There is no reason to believe that the Legislature intended to reserve use of this valuable tool for serving the public interest to cases where rates are also being regulated while leaving some companies free to issue securities without public participation. The statutory language gives no indication of any such intent and we will not read limiting language into it.
We also hold that Power Company, like Michigan Gas Storage Company, is a public utility indirectly selling electricity to the public.
Ill
The next matter that must be considered is whether the Congress, in enacting a Federal regulatory scheme applicable to Power Company, preempted state regulation of Power Company’s securities issuances. We believe that it did not.
As mentioned, Power Company, upon commencement of operations, will sell electricity only to Electric Company at wholesale for resale. In this setting, Power Company was subject to the jurisdiction of the FPC under the Federal Power Act. Under that act, the FPC was to exercise authority over Power Company’s rates, service and facilities.
The Federal Power Act, unlike the Natural Gas Act, did contain explicit authority under which the FPC was authorized to regulate the securities of subject utilities where regulation by specified states does not exist. Those provisions are not dispositive of the question before us, however, because the Federal Power Act also provides that the securities regulation provisions do not apply when the PUHCA applies, as it does in this case.
Provisions of the PUHCA authorize, inter alia, the Securities and Exchange Commission to regulate the issuance and sale of securities by regis tered public utility holding companies and their subsidiaries. The Court of Appeals found, and we agree, that the PUHCA created concurrent regulatory jurisdiction in the SEC and the states over companies like Power Company. The Court then went on to express doubt whether Congress intended to allow the states to regulate securities where they do not regulate rates, a matter we will discuss, infra.
Briefly, the scheme of the PUHCA, with respect to securities issuances, is one which requires the approval of the SEC before a holding company or subsidiary company to which the securities provisions apply issues or sells its own securities or alters the priorities, preferences or powers attached to existing securities. 15 USC 79f. The procedure for acquiring the approval of the SEC requires the filing of a "declaration” with the Commission which may become "effective”, thereby creating the condition necessary for the lawful issuance and sale of securities. 15 USC 79f, 79g.
As mentioned, supra, Power Company filed declarations with the SEC with respect to the issuances with which we are concerned here. The SEC issued orders permitting the declarations to become effective.
The holding company act also, we are convinced, contains a clear expression of congressional intent not to remove from the states power over the securities of local subsidiary operating companies as exercised through the state public service commissions. State commissions have not been divested of all jurisdiction over the securities of these companies. Rather, a partnership of concurrent state-Federal control has been created.
This intent is evidenced by a number of provisions of the statute.
First, 15 USC 79u provides in part:
"[N]or shall anything in this title affect the jurisdiction of any other commission, board, agency, or officer of the United States or of any State or political subdivision of any State, over any person, security, or contract, insofar as such jurisdiction does not conflict with any provision of this title or any rule, regulation or order thereunder.”
Next, 15 USC 79g(g) requires that as a condition necessary to the effectiveness of a declaration, applicable state laws must be complied with:
"If a State commission or State securities commission, having jurisdiction over any of the acts enumerated in subsection (a) of section 6 [15 USC 79f(a)], shall inform the Commission, upon request by the Commission for an opinion or otherwise, that State laws applicable to the act in question have not been complied with, the Commission shall not permit a declaration regarding the act in question to become effective until and unless the Commission is satisfied that such compliance has been effected.”
Finally, as discussed at length by the Court of Appeals, the PUHCA establishes an "exemption” from the provisions of 15 USC 79f, supra, which require an effective declaration before securities may be lawfully issued or sold, for subsidiary companies of registered holding companies where "the issue and sale of such security are solely for the purpose of financing the business of such subsidiary company and have been expressly authorized by the State commission of the State in which such subsidiary company is organized and doing business * * *”.
Power Company urges that an exemption from the declaration requirements did not exist in this case because an exemption must be applied for and no such application was filed for the securities issues concerned here. Instead, a declaration was filed and approved pursuant to the provisions of 15 USC 79g.
We agree with Power Company that there was no exemption here. None was applied for. We do disagree, however, with Power Company’s suggestion that because the issuances have not been exempted and have been subject to thorough SEC regulation under 15 USC 79g, the Michigan Public Service Commission has been relieved of all authority with respect to issuance of its securities.
On the contrary, we believe the statutory provisions described above seek to preserve state regulatory authority in these matters. We do not believe there was any intent on the part of Congress to allow subsidiary operating companies to avoid state jurisdiction by simply choosing to file a declaration under 15 USC 79g. Indeed, that section assumes the continued jurisdiction of a state commission over matters covered by 15 USC 79f, including the issuance of securities where the state legislatures have granted regulatory authority to the commissions.
In light of what we believe is a clear congressional intent not to place exclusive regulatory control of securities issuances like the instant one to the SEC under the PUHCA, we conclude that Public Service Commission regulation in the instant case has not been preempted by that act. Further, we find no congressional intent to preempt the states in this area in the Federal Power Act which granted rate jurisdiction to the FPC. We discussed a similar argument at length in Michigan Gas Storage, supra, and rejected it.
As we have said, supra, the Federal Power Act grant of explicit authority to the FPC to regulate the securities of electric companies within its jurisdiction was limited to those instances in which the companies are not organized and operating in a state under which their securities issues are regulated by a state commission.
As in the case of the Natural Gas Act, the legislative history of the congressional enactments indicates a purpose to extend Federal regulation to matters that could not be regulated by the states and also to exert Federal authority to strengthen and assist the states in the exercise of their regulatory powers and not to impair or diminish the proper powers of any state commissions. See Jersey Central Power & Light Co v Federal Power Commission, 319 US 61; 63 S Ct 953; 87 L Ed 1258 (1943); Connecticut Light & Power Co v Federal Power Commission, 324 US 515; 65 S Ct 749; 89 L Ed 1150 (1945). We believe the Federal statutory scheme and the history behind it strengthen that conclusion based upon application of the general test for determining whether a Federal statute has occupied an area to the exclusion of any action by the states. See Florida Lime & Avocado Growers, Inc v Paul, 373 US 132; 83 S Ct 1210; 10 L Ed 2d 248 (1963).
The issue is not, according to that case, as Power Company urges, whether the two levels of regulation are both aimed at the same objective, viz: the protection of utility ratepayers, but whether both regulations can be enforced without impairing the Federal superintendence of the field. Given the explicit statutory deference to state commission authority over companies organized and operating in that state, we are convinced that Congress recognized that state securities regulation would have some effect on Federal regulation of inter state rates and had no intent to eliminate that effect.
IV
The final argument offered by Power Company against exercise of the regulatory authority of the Michigan Public Service Commission is that the Commerce Clause itself precludes it as an undue interference with commerce.
We reject this contention for the same reasons we did in Michigan Gas Storage, supra, and for the additional reason that Congress, which has legislative authority over interstate commerce, has explicitly recognized and affirmed state jurisdiction in legislating in the area. The mere fact that a company is engaged in interstate commerce, as we said in Michigan Gas Storage, does not foreclose the state from regulating some aspects of its operations. The states may continue to exercise their police powers over matters of local concern, even though the regulation affects interstate commerce, so long as the regulation does not impede the free flow of commerce. Southern Pacific Company v Arizona, 325 US 761; 65 S Ct 1515; 89 L Ed 1915 (1945). Whether a state regulation unconstitutionally burdens commerce must be evaluated in light of the nature and extent of the burden that would be imposed and the state and national interests at stake. Id., Panhandle Eastern Pipe Line Co v Public Service Commission of Indiana, 332 US 507; 68 S Ct 190; 92 L Ed 128 (1947); People v County Transportation Co, 303 NY 391; 103 NE2d 421 (1952), app dis 343 US 961 (1952).
As we said in Michigan Gas Storage, we do not believe any undue burden exists as a consequence of the type of regulation involved here. We are dealing with a company organized under the laws of the state — one which will have all of its facilities and assets located in this state and one which operates under the laws of this state. It will sell electric power to its parent which will take delivery at Power Company’s plant, all within this state. We believe the state has a very substantial interest in the issuance of securities under its laws by a company organized and operating here.
On the other hand, it appears on the record in this case, unlike the record in Michigan Gas Storage, that electricity generated by Power Company may ultimately be transported to and consumed in other states. Like the situation in that other case, however, no other state appears to have jurisdiction over Power Company. The orders of the Securities and Exchange Commission allowing Power Company’s declarations to become effective under the PUHCA stated that no other state commission had jurisdiction. And, the Federal legislation in the area generally recognizes the state in which utilities are both organized and operating. In this situation we are convinced that no burden on the national interest will be created.
V
In view of the foregoing, the decision of the Court of Appeals is reversed.
Coleman, C.J., and Kavanagh, Williams, Levin, Fitzgerald, and Blair Moody, Jr., JJ., concurred with Ryan, J.
MCL 460.61; MSA 22.11 provides for the following statutory securities issuance fee:
"Whenever any stocks, bonds, notes or other evidences of indebtedness are authorized by the commission to be issued in accordance with any law of this state, the party or parties upon whose application said securities are authorized shall before the issuance or sale of said securities, pay into the treasury of the state of Michigan a sum equal to 1/10 of 1 per cent of the face value of the securities so authorized; the sum so paid not to be less than $50.00 in any case: Provided, That a minimum fee of $5.00 shall be paid by rural telephone companies with respect to the authorization to borrow money: Provided, however, That where the property upon which such stocks, bonds, notes or other securities are authorized to be issued, is located partly within and partly without the state of Michigan, then said fee shall be computed only in such an amount and on such proportion of the entire issue, as the amount of the property of such applicant actually located within the state of Michigan, bears to the total amount of the property upon which such securities are issued.”
The total statutory fee for the applications filed in the instant case amounted to $431,500.
16 use 824c.
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Brennan, J.
Following a jury trial, defendant was convicted of conspiracy to deliver 225 grams or more, but less than 650 grams of cocaine and delivery of the same amount of cocaine, MCL 750.157a; MSA 28.354(1); MCL 333.7401(2)(a)(ii); MSA 14.15(7401)(2)(a)(ii). Defendant was sentenced to concurrent terms of 120 to 360 months of imprisonment. He appeals as of right, and we affirm.
Defendant first argues that the trial court committed error requiring reversal admitting testimonial evidence of prior bad acts of the defendant. Codefendant Gary Ciraulo testified regarding defendant’s drug-dealing activities during the year before defendant’s arrest. The trial court allowed the testimony under MRE 404(b) as proof of defendant’s intent to distribute cocaine.
Evidence of similar acts may be admitted where: (1) there is substantial evidence that the defendant committed the similar act; (2) some special quality of the act tends to prove the defendant’s identity or the motive, intent, absence of mistake or accident, scheme, plan, or system, and opportunity, preparation, and knowledge; (3) one or more of these factors are material to defendant’s guilt of the charged offense; and (4) the probative value of the evidence substantially outweighs the danger of unfair prejudice. People v Golochowicz, 413 Mich 298, 307-309; 319 NW2d 518 (1982).
In the present case, there was substantial evidence that defendant committed the prior acts. In addition to codefendant Ciraulo’s testimony, Mark Rubino testified that he purchased drugs from Ciraulo and that Ciraulo told him that he had received the drugs from defendant. The testimony was credible in light of the fact that it was also damaging to Ciraulo and Rubino. The testimony regarding the prior drug activity showed defendant’s intent to distribute cocaine, which was necessary for defendant’s convictions. Defendant ad mitted possession of the drugs, and the only major issue in the case was whether he intended to deliver the drugs to others. Therefore, intent was in issue. Although the evidence was clearly prejudicial to defendant, it was highly probative with regard to the issue of intent. We believe that the probative value of the evidence substantially outweighed the danger of unfair prejudice. Accordingly, we find that the trial court did not abuse its discretion in allowing the evidence. People v Rockwell, 188 Mich App 405, 410; 470 NW2d 673 (1991).
Defendant further argues that the trial court abused its discretion in sentencing him to the mandatory ten-year minimum sentence when there were substantial and compelling reasons for departing from the mandated minimum. Defendant alleges that the substantial and compelling circumstances consisted of his act of revealing a fellow prisoner’s plan to have several individuals executed. Defendant states that his cooperation ultimately resulted in the fellow prisoner’s plea-based conviction of solicitation to murder. We note that the trial court imposed the sentence requested by defense counsel. Moreover, we find that substantial and compelling reasons for departing from the mandatory minimum sentence did not exist. Although the trial court may consider postarrest facts in determining whether substantial and compelling reasons exist, it should do so with greater caution than when considering prearrest facts, given the risk that defendants will create postarrest events to influence the sentencing court. People v Windall Hill, 192 Mich App 102, 115; 480 NW2d 913 (1991). We do not find defendant’s case to be exceptional or his cooperation with the authorities to be of such significance that it renders the statutory sentence clearly inappropriate to defendant. People v Krause, 185 Mich App 353, 357; 460 NW2d 900 (1990), citing People v Downey, 183 Mich App 405, 416; 454 NW2d 235 (1990). Accordingly, we find that the trial court did not abuse its discretion in sentencing defendant. Krause, supra, p 359.
Defendant argues that his trial counsel rendered ineffective assistance at sentencing because counsel was under the illusion that the twenty-year rather than the ten-year mandatory minimum sentence was in effect at the time of sentencing. However, the sentencing transcript clearly reveals that defense counsel was aware that the ten-year mandatory minimum was in effect. Defense counsel argued for a ten-year minimum as opposed to the twenty-year minimum sentence the prosecutor was requesting. In addition, during the sentencing proceeding, the prosecutor addressed the fact that the mandatory minimum sentence was ten years.
Defendant further contends that his counsel was ineffective because counsel did no investigatory work pertaining to defendant’s cooperation with the authorities in reporting the murder contract initiated by a fellow prisoner. Defendant explains that his attorney merely stated on the record that defendant cooperated with the authorities and, as a result, the sentencing court referred to defendant’s "alleged” cooperation and the "alleged” contract to kill. Defendant contends that the court would have had substantial and compelling reasons to depart from the mandatory minimum sentence had it believed that defendant cooperated. However, regardless of whether the trial court believed defendant’s claim, we have already found that defendant’s claim does not constitute substantial and compelling reasons to depart from the statutory minimum sentence. Therefore, defendant has suffered no prejudice as a result of defense counsel’s "omission,” and defendant’s ineffective assistance of counsel claim is without merit. People v Gist, 188 Mich App 610, 613; 470 NW2d 475 (1991).
Finally, defendant argues that the trial court actually resentenced defendant at the hearing on his motion for resentencing without the defendant being present. However, in its opinion regarding defendant’s motion for resentencing and to correct judgment of sentence, the trial court merely noted that it had not previously articulated its reasons for defendant’s sentences and proceeded to do so. This does not constitute resentencing. Therefore, defendant is not entitled to resentencing. See People v Strunk, 172 Mich App 208, 211; 431 NW2d 223 (1988).
Affirmed.
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Connor, J.
Defendant appeals as of right his judgment of sentence of April 19, 1989. A jury convicted defendant of one count of first-degree felony murder, MCL 750.316; MSA 28.548, and he received a mandatory sentence of life imprisonment without possibility of parole. We affirm.
The victim in this case was found dead in her. home on October 8, 1987. The cause of death was established as multiple stab wounds to the chest area. The front screen door had a cut in it, apparently made by a knife. Inside the victim’s home, the contents of her purse were strewn about the area where it was believed a struggle occurred. Many items thought to have been inside the purse were covered with blood, including the victim’s driver’s license and her wallet. The wallet was found to contain one folded-up dollar bill in the change section along with some change. The victim’s live-in boyfriend testified that he saw the victim place at least $4 inside the wallet the evening before her death.
i
Defendant first argues that there was insufficient evidence presented by the prosecution to bind him over to the circuit court on the charge of first-degree felony murder. The examining magistrate originally agreed with defendant and only found probable cause to charge defendant with second-degree murder. The prosecutor appealed that ruling to the circuit court, which reversed the magistrate’s decision and charged defendant with first-degree felony murder.
In order for a defendant to be bound over for trial, the magistrate must find that there is evidence amounting to probable cause to believe that a felony has been committed. People v Hill, 433 Mich 464, 469; 446 NW2d 140 (1989); MCL 766.13; MSA 28.931. Although a finding of guilt beyond a reasonable doubt is not necessary, there must be evidence regarding each element of the crime charged or evidence from which the elements may be inferred. Hill, supra.
In reviewing a decision to bind a defendant over for trial, the circuit court may not substitute its judgment for that of the examining magistrate, and may reverse only if it appears on the record that the magistrate abused his discretion. People v Cotton, 191 Mich App 377, 384; 478 NW2d 681 (1991). This Court also reviews the record to determine if the examining magistrate committed an abuse of discretion. People v Lopez, 187 Mich App 305, 308; 466 NW2d 397 (1991).
For felony murder, the following elements of the crime must be established:
(1) [T]he killing of a human being (2) with the intent to kill, to do great bodily harm, or to create a very high risk of death or great bodily harm with knowledge that death or great bodily harm was the probable result (3) while committing, attempting to commit, or assisting in the commission of any of the felonies specifically enumerated in MCL 750.316; MSA 28.548. [People v Bush, 187 Mich App 316, 327; 466 NW2d 736 (1991).]
See also People v Flowers, 191 Mich App 169, 174-176; 477 NW2d 473 (1991).
The enumerated felony relied upon in this case was larceny. The statute, MCL 750.316; MSA 28.548, provides that murder is of the first degree if "committed in the perpetration, or attempt to perpetrate . . . larceny of any kind.” Because the intent to commit the enumerated felony of larceny was an element of the crime of felony murder, the prosecution had to produce some evidence with regard to this element or evidence from which this element could be inferred. Hill, supra, p 469.
It is not necessary that the murder be contemporaneous with the enumerated felony. The statute requires only that the defendant intended to commit the underlying felony at the time the homicide occurred. People v Goddard, 135 Mich App 128, 136; 352 NW2d 367 (1984), rev’d on other grounds 429 Mich 505; 418 NW2d 881 (1988); People v Vaughn, 128 Mich App 270, 273-274; 340 NW2d 310 (1983). However, the felony-murder doctrine will not apply if the intent to steal property of the victim was not formed until after the homicide. People v David Wells, 102 Mich App 122, 133; 302 NW2d 196 (1980). Where evidence conflicts or raises a reasonable doubt regarding the defendant’s guilt, it is not for the examining magistrate to discharge the defendant; such questions are for the trier of fact to resolve. People v Doss, 406 Mich 90, 103; 276 NW2d 9 (1979).
In this case, the examining magistrate in the district court bound the defendant over on a charge of second-degree murder because the magistrate found that the evidence that money was removed from the victim’s wallet merely estab lished that a larceny was committed. The magistrate felt the larceny could have been an afterthought to the homicide and noted that the wallet was covered with blood. The prosecution appealed this decision to the circuit court. The circuit court found that the examining magistrate had abused his discretion by unduly focusing on the timing of the larceny rather than the timing of the intent. The court also found that a jury could infer that the defendant intended to commit the larceny at the time of the killing and ordered the defendant bound over on a charge of first-degree felony murder. The court specifically referred to medical testimony regarding the presence of defensive wounds on the victim’s hands, indicating a struggle, and police testimony that placed the strewn contents of the victim’s purse IV2 to 2 feet from where the struggle began.
Although it is a close question, we agree with the circuit court that the decision to bind defendant over for trial on the reduced charge of second-degree murder was an abuse of discretion. The trier of fact could infer from the evidence that the killing and the underlying felony were so closely connected in point of time, place, and causal relation that the homicide was incident to the felony and associated with it as one of its hazards. Goddard, supra, p 136. Considering all the facts and circumstances in evidence, we believe the trier of fact could infer that the wounds were inflicted during a struggle for the purse. We find in this case that the question regarding precisely when the defendant’s larcenous intent was first formed was for the jury to decide, not the examining magistrate. Flowers, supra, pp 178-179.
11
Defendant’s next issue on appeal concerns his challenge of statements made to the police that were ruled admissible by the trial court. The challenge of the admissibility of these statements is based on the Deaf Persons’ Interpreters Act, MCL 393.501 et seq.; MSA 17.55(101) et seq. Section 5 of that act, MCL 393.505; MSA 17.55(105), provides as follows:
(1) If a deaf person is arrested and taken into custody for any alleged violation of a criminal law of this state, the arresting officer and the officer’s supervisor shall procure a certified interpreter or qualified interpreter in order to properly interrogate the deaf person and to interpret the deaf person’s statements.
(2) A statement taken from a deaf person before a certified interpreter or qualified interpreter is present shall not be admissible in court.
The act defines a "deaf person” as
a person whose hearing is totally impaired or whose hearing, with or without amplification, is so seriously impaired that the primary means of receiving spoken language is through other sensory input; including, but not limited to, lip reading, sign language, finger spelling, or reading. [MCL 393.502(e); MSA 17.55(102)(e).]
The purpose of the act is to provide a way for deaf individuals to meaningfully participate in judicial (or investigative) proceedings. Bednarski v Bednarski, 141 Mich App 15, 19-20; 366 NW2d 69 (1985). Our research has not disclosed a published criminal case where this act has been applied.
A
A trial court’s decision regarding whether an individual is a deaf person is based upon factual findings, and we review that decision for clear error. MCR 2.613(C). An evidentiary hearing should be conducted when there is a challenge of the admissibility of a statement from a defendant who asserts he should have been provided with an interpreter under MCL 393.505; MSA 17.55(105).
We believe the preliminary focus of the hearing is sufficiently stated in MCL 393.502(e); MSA 17.55(102)(e) by the definition of a "deaf person.” The testimony should center on whether the individual lacked the necessary communication skills to make a statement without the aid of an interpreter.
In this case, there was conflicting testimony from experts and laypersons regarding defendant’s hearing ability. There was no question that defendant has had some form of hearing impairment for years and has even worn a hearing aid in the past. However, he apparently did not require the use of the hearing aid in his day-to-day activities, and refused to wear it for unknown reasons. Nonetheless, the experts testified that although defendant could hear some conversation, particularly at elevated levels, he still relied on visual cues to receive communications. Defendant was believed to be proficient at lip reading, but was never tested for this skill.
Other witnesses who either worked with defendant or engaged in high school athletics with him offered a different view of his hearing ability. They either were not aware that defendant had any hearing problem or had seen him pretend not to hear in situations where he was being scolded or embarrassed.
Most of the officers who had contact with defendant during his four police interviews noted that he had a speech or hearing problem, and efforts were made to ensure that he could hear and understand. Defendant told the officers that he had a bad ear, and he would turn so that the officers’ voices were directed at his good ear. At no point did defendant state that he was deaf or required an interpreter. The officers did not inquire if an interpreter was needed. All conversations with the police were conducted with only a few feet, or less, of space separating the conversants. The officers also provided defendant with a copy of an advice-of-rights form to follow along as they explained his rights. Generally, defendant did not appear to have a problem understanding the officers, although some statements had to be repeated, and defendant gave appropriate responses to all questions he was asked.
We have reviewed the findings of fact enunciated by the court after it conducted an evidentiary hearing regarding defendant’s hearing ability. We do not find the findings of fact and conclusions of law with regard to this issue to be clearly erroneous. The evidence conflicted with regard to the degree of defendant’s hearing disability and whether he was required to rely on means other than hearing to receive spoken communications.
Our analysis does not end here, however. We believe a reviewing court must engage in a two-step analysis when determining whether a defendant’s statement is admissible when he claims he has a hearing deficiency. First, if the court finds the defendant is "deaf,” as defined by the statute, then the Legislature has provided that the defendant cannot be interrogated unless he is provided with an interpreter and that any statement made by a deaf defendant unaided by an interpreter must be automatically excluded. MCL 393.502(e); MSA 17.55(102)(e); MCL 393.505(2); MSA 17.55(105)(2). Second, if the court finds the defen dant is not "deaf,” as provided by the statute, the court must still determine whether the hearing-impaired defendant was able to comprehend his rights and make a knowing and intelligent waiver of his rights.
B
We believe the Deaf Persons’ Interpreters Act is generally based on the same Fifth Amendment concepts associated with the waiver of rights and the voluntariness of statements. Consequently, we find that the basic principles applicable to Walker hearings are applicable to hearings under the Deaf Persons’ Interpreters Act. Where a defendant does not knowingly and intelligently waive his Miranda rights, the statement is involuntary. People v Nantelle, 130 Mich App 51, 53; 342 NW2d 627 (1983). A defendant must understand the circumstances surrounding an interrogation, otherwise the voluntariness of any statement is vitiated. People v Langston, 57 Mich App 666, 675; 226 NW2d 686 (1975).
An effective waiver of Miranda rights does not require an oral recitation. Although it is not generally encouraged, a written advice-of-rights form may be sufficient. Nantelle, supra, pp 52-53. The use of a written form becomes more palatable in a case involving a defendant who is hearing-impaired.
Before utilizing a statement made by a hearing-impaired defendant either with or without the assistance of an interpreter, it must be established that the defendant comprehended his Miranda rights and intelligently waived them before making the statement. See State v Spivey, 755 SW2d 361, 362 (Mo App, 1988); State v Randolph, 698 SW2d 535, 539 (Mo App, 1985). A waiver is intelligently made when the Miranda warnings are explained to the defendant by an interpreter familiar with and competent in the defendant’s primary language. State v Mason, 53 Or App 811, 821-822, n 3; 633 P2d 820 (1981). Where a hearing-impaired defendant is subjected to polygraph examinations, even greater care must be taken in explaining the rights and questions involved. Id.
When the defendant has challenged the admissibility of his statements, the prosecution has the burden of proving voluntariness by a preponderance of the evidence. People v DeLisle, 183 Mich App 713, 719; 455 NW2d 401 (1990). When reviewing the voluntariness of a statement, we review the trial court’s determination after a review of the entire record, and an independent determination is made by this Court. However, great deference is given to the trial court’s assessment of the credibility of witnesses, and its findings of fact will not be reversed unless clearly erroneous. People v Seymour, 188 Mich App 480, 482-483; 470 NW2d 428 (1991).
We have considered the totality of the circumstances surrounding the defendant’s statements that were ruled admissible by the trial court, People v Cipriano, 431 Mich 315, 334; 429 NW2d 781 (1988). We believe that the totality of the circumstances demonstrate that defendant understood his rights and agreed to waive them by speaking to the police. In light of defendant’s hearing difficulties, the police took special care to see that he understood his rights by use of a written form explaining the rights he was waiving. Under these circumstances, we do not believe the trial court erred in ruling that defendant voluntarily waived his rights and that the waiver was intelligently and knowingly made.
hi
The third and final issue raised by defendant concerns whether the affidavits presented in support of a search warrant established probable cause. The warrant allowed the police to search defendant’s residence, where they found bloodstained clothing and shoes placed within a suspended ceiling in the basement.
An affidavit for the search warrant was prepared by Officer Michael Debnar. It incorporated by reference two other affidavits.
Probable cause sufficient to support issuing a search warrant exists when all the facts and circumstances would lead a reasonable person, to believe that the evidence of a crime or the contraband sought is in the place requested to be searched. People v Lucas, 188 Mich App 554, 567; 470 NW2d 460 (1991).
After reviewing the affidavits offered in support of the search warrant, we find no error. The affidavits established probable cause to search defendant’s home, which he shared with his mother, for evidence related to the victim’s homicide. We also find no error in the fact that the affidavit offered in support of the warrant request incorporated two other affidavits related to the homicide. Even if we were to treat the supplemental affidavits as hearsay, we would still find them adequate because each specifically named the individual supplying the information and alleged that the information was based on personal knowledge. MCL 780.653; MSA 28.1259(3); People v Harris, 191 Mich App 422, 425; 479 NW2d 6 (1991). Compare People v Sherbine, 421 Mich 502, 507-511; 364 NW2d 658 (1984). The supplemental affidavit of Glenda Wells established that she had a telephone conversation with the victim shortly before her death and that defendant was at the victim’s home at that time, and Officer Davis’ affidavit established the circumstances of the victim’s death. This information coupled with Officer Debnar’s own personal information established that there was probable cause to search defendant’s home for evidence related to the victim’s death. Moreover, the warrant was particular enough with regard to the place to be searched and the items to be seized. US Const, Am IV; Const 1963, art 1, § 11; MCL 780.651; MSA 28.1259(1). Contrary to defendant’s argument, there was no evidence that the home he shared with his mother was a multiunit dwelling. Therefore, unit numbers were not required for the warrant. See People v Hunt, 171 Mich App 174, 177; 429 NW2d 824 (1988).
Affirmed._
People v Walker (On Rehearing), 374 Mich 331; 132 NW2d 87 (1965) .
Miranda v Arizona, 384 US 436; 86 S Ct 1602; 16 L Ed 2d 694 (1966) .
The 1988 amendments of MCL 780.653; MSA 28.1259(3) are not applicable in this case because the search warrant was obtained in 1987. | [
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Sullivan, J.
Plaintiffs’ suit against their former employer, defendant Philip Morris, Inc., and two of its employees, defendants W. Allen Graham and Barry Hopkins, arose out of the termination of plaintiffs’ employment. Plaintiffs alleged wrongful discharge and tortious interference with contractual relationships. Following a jury trial, the jury returned a verdict for plaintiffs on both theories. Plaintiff Bradley was awarded $906,000 against Philip Morris, $10,600 against Hopkins, and $14,500 against Graham. Plaintiff Carsley was awarded $500,000 against Philip Morris, $10,600 against Hopkins, and $14,500 against Graham. A judgment was entered in accordance therewith. Defendants’ posttrial motions were denied. They now appeal as of right. We reverse and remand for a new trial on plaintiffs’ claims against Philip Morris, and reverse the judgment against defendants Graham and Hopkins with no new trial.
At the outset, we note that reversal of the judgment against Philip Morris is based on the exclusion of evidence we believe Philip Morris was entitled to present to the jury for a proper determination — evidence of misconduct of plaintiffs, which was not discovered until after their employment was terminated, and evidence of Philip Morris’ duties under title VII of the Civil Rights Act of 1964, 42 USC 2000e et seq., and the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq.
The termination of plaintiffs’ employment arose out of events that allegedly occurred on a Detroit Grand Prix weekend in a hotel room paid for by Philip Morris. Philip Morris arranged to have hotel rooms available in the Westin Hotel for its employees and for the purpose of entertaining clients. Plaintiff Ronald Bradley and defendants Graham and Hopkins all were supervisors in Philip Morris’ Farmington Hills office.
On the evening in question, two secretaries who worked in the Farmington Hills office — plaintiff Cynthia Carsley and Gina Stauch — met other Philip Morris employees in the Renaissance Center for drinks. Bradley, Carsley, and Stauch ended up in Bradley’s hotel room, which was paid for by Philip Morris. Briefly put, Stauch alleged that she fell asleep in a chair in the room, and when she awoke a few hours later, Bradley and Carsley were having sexual intercourse in the bed located a few feet away.
Out of concern over what would happen if they knew she had seen them, Stauch ignored the situation. Eventually, however, Stauch’s allegations were made known to Graham and Hopkins. Stauch’s work performance and attitude had allegedly declined and she no longer respected Bradley or Carsley. Graham testified that he believed Bradley was favoring Carsley by not assigning her work when she did not appear to be busy. Although Bradley and Carsley testified that they did not have sexual intercourse on the night in question, they were both fired for misconduct — offensive action to another employee.
Plaintiffs’ theory at trial was threefold. First, they argued that Stauch had lied, they did not have intercourse in the hotel room in front of Stauch, and therefore just cause to terminate their employment did not exist. Then they argued that, even if Stauch was not lying, the misconduct was not work-related. Finally, they argued that Philip Morris did not follow its six-step procedure in terminating their employment — the rules were not uniformly applied as promised. The jury found in favor of plaintiffs.
Before trial, plaintiffs moved to exclude any evidence of previous misconduct that was discovered after their employment was terminated. The trial court ruled that such evidence was irrelevant and highly prejudicial. We disagree.
Evidence of employee misconduct occurring before termination is admissible as substantive evidence even if the former employer did not know of the misconduct until after the termination. Just cause for termination may include facts and circumstances existing at termination but not known to the employer. See 53 Am Jur 2d, Master and Servant, §46, pp 120-121; Leahey v Federal Express Corp, 685 F Supp 127 (ED Va, 1988); Summers v State Farm Mutual Automobile Ins Co, 864 F2d 700, 708 (CA 10, 1988); and Pugh v See’s Candies, Inc, 203 Cal App 3d 743; 250 Cal Rptr 195 (1988). Moreover, this type of evidence is relevant to the issue of damages. Having reviewed the record, we conclude that the trial court abused its discretion in excluding this type of evidence and in not permitting defendants’ attorney to make a corresponding argument to the jury.
Furthermore, the trial court precluded defendants’ attorney from presenting evidence regarding defendants’ duties under title VII and the Civil Rights Act with regard to claims of sexual harassment and defendants’ concern over its potential liability to Stauch. An employer may avoid liability for a sexual discrimination claim based on a hostile work environment if it adequately investigated and took prompt and remedial action upon notice of the alleged hostile work environment. Downer v Detroit Receiving Hosp, 191 Mich App 232; 477 NW2d 146 (1991).
In the recent decision in Reisman v Regents of Wayne State University, 188 Mich App 526; 470 NW2d 678 (1991), involving reverse discrimination, a panel of this Court held that the trial court’s instruction that if race was at least one of the reasons for not renewing the plaintiffs contract, the defendant could not avoid liability to the plaintiff by claiming that the defendant’s acts were done pursuant to an unapproved affirmative action plan precluded the jury from considering the defendant’s possible affirmative action motivation as a justification for the decision not to renew the plaintiff’s contract. The Court reasoned that unapproved affirmative action plans are not invalid and that actions taken pursuant to such plans are not discriminatory per se. To hold that an unapproved plan is void ignores the purpose of the Civil Rights Act and fails to consider the duty of public employers under the federal constitution to implement affirmative action programs to remedy the effects of past discrimination. Id., p 537.
As in Reisman, the trial court in this case precluded a "defense” from being presented to the jury, resulting in error requiring reversal. We believe that the trial court’s exclusion of evidence of defendants’ concern over its potential liability to Stauch for a possible sexual harassment claim precluded the jury from fully considering defendants’ reasons for terminating plaintiffs’ employment and whether just cause existed. It is not enough that an employer acted in good faith or was not unreasonable in discharging an employee. Instead, the jury must determine whether the reason for discharge amounted to good cause. Renny v Port Huron Hosp, 427 Mich 415, 429; 398 NW2d 327 (1986). The evidence sought to be admitted in this case was relevant to determinations the jury was required to make.
Because of the exclusion of these two types of evidence, a new trial is warranted with regard to plaintiffs’ wrongful discharge claim.
We also reverse the judgment against individual defendants Graham and Hopkins. However, a new trial is not warranted. Instead, we hold that the trial court erred in not granting judgment notwithstanding the verdict.
To maintain a cause of action for tortious interference with a contract, a plaintiff must establish that the defendant instigated the breach of a contract and did so without justification. Henry v Hosp & Health Services Credit Union, 164 Mich App 90, 94; 416 NW2d 338 (1987); Dzierwa v Michigan Oil Co, 152 Mich App 281, 287; 393 NW2d 610 (1986). The defendant is not liable if, as here, he is a corporate agent or officer and if he acted on his employer’s behalf. In other words, the defendant who is a corporate officer or agent is liable for tortious interference only if he acted for his own benefit with no benefit to the corporation. See Stack v Marcum, 147 Mich App 756, 759-760; 382 NW2d 743 (1985), and Tash v Houston, 74 Mich App 566, 571-574; 254 NW2d 579 (1977).
In this case, even viewing the evidence in a light most favorable to plaintiffs — the nonmoving party —we conclude that reasonable minds could not differ over whether Graham and Hopkins were acting for the benefit of Philip Morris or for their own personal benefit with no benefit to Philip Morris. The evidence and the inferences to be drawn therefrom failed to show that Graham’s and Hopkins’ actions were based on personal motivation and that the actions were for their personal benefit. The judgment against Graham and Hopkins is reversed.
This matter is remanded for a new trial on the wrongful discharge claim only.
During the direct examination of Philip Morris’ director of employee relations, defendants’ attorney asked the witness whether under the circumstances of this case the company had "any liabilities, vis-a-vis Title Seven of the Civil Rights Act of 1964.” The witness answered definitely. But plaintiffs’ subsequent objection was sustained because this was not a title VII action, and the question was withdrawn. Moreover, on redirect examination, the same witness testified that the company was worried about its liability to Stauch if the company failed to do anything about her complaints. Plaintiffs’ objection was again sustained.
The standard of review is:
A trial court’s denial of a motion for judgment notwithstanding the verdict is reviewed to determine whether there are material issues of fact upon which reasonable minds might differ. Means v Jowa Security Services, 176 Mich App 466, 471; 440 NW2d 23 (1989). In deciding a motion for directed verdict or for judgment notwithstanding the verdict, a trial court must examine the testimony and all legitimate inferences that may be drawn from that testimony in a light most favorable to the nonmoving party. When the evidence is such that reasonable jurors could disagree, neither the trial court nor this Court may substitute its judgment for that of the jury. Means, supra. [Lester N Turner, PC v Eyde, 182 Mich App 396, 398; 451 NW2d 644 (1990).] | [
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McGregor, P. J.
This aetion was commenced by the City of Midland on September 1, 1970, against defendant as the circulator of a petition requesting that § 10.16 of the city charter, dealing with recall, be amended.
The proposed amendment, passed by the electorate on November 3, 1970, adds the city manager to the officers subject to voter recall and reads as follows:
“Any elective and one appointed officer, the city manager, may be removed from office by the electors of the city in the manner provided by the general laws of the state. Vacancy created by the recall of any elective and one appointed officer, the city manager, shall be filled in the manner prescribed by law.” (Amendment additions to the original § 10.16 are in italics.)
Defendant contends that the proposal is an amendment and its passage conformed to statutory procedure and is valid, and that it is not unconstitutional simply to add the city manager to the list of officers subject to voter recall.
Plaintiff argues that it is unconstitutional to amend the city charter with a provision permitting the recall of a nonelective officer and that the amendment is void and unconstitutional because the change was in fact a charter revision rather than an amendment.
The case was submitted to the trial court as a question of law on the pleadings. In a published opinion, the trial court held that:
“This opinion is not intended to, nor does it, hold that the electorate cannot change the charter of the City of Midland to provide for the recall of the city manager, as well as other administrative officers, if they so desire, but this change should be accomplished by revision of the charter and the creation of a different form of city government. Such a change would obviously not be a council-city manager form of government.
“For the reasons hereinbefore stated, a judgment may be entered declaring the revision of the city charter to be illegal and of no effect.” (Emphasis added.)
On appeal there are two issues: first, this Court is asked whether, under the 1963 Michigan Constitution, a city charter may be amended so as to provide for the recall of a nonelective city official; second, the question is whether the proposal to change the original city charter is a charter amendment or a charter revision. Constitutional questions need not be decided where a case may be disposed of without such a determination. MacLean v State Board of Control for Vocational Education, 294 Mich 45 (1940); Cole v Battle Creek, 298 Mich 98 (1941); In re Winkle, 372 Mich 292, 325 (1964). Our decision on the second issue makes it unnecessary for us to determine whether or not the provisions of the state constitution of 1963 and related statutes, concerning the recall of a nonelective city manager, are constitutional.
Defendant’s proposed charter change was drafted in the form of an amendment and was passed in accordance with the procedure covering amendments. MCLA 117.21; MSA 5.2100. Plaintiff contends that the proposal is a charter revision which is a totally different concept, and is procedurally controlled by MCLA 117.18; MSA 5.2097.
If the proposed change only amends, alters, or improves within the lines of the original charter, it is an amendment and the passage by the city electorate was valid. But, if the proposed change totally disrupts, cancels, abrogates, or makes inoperable the original charter, it is a revision and the amendment procedure and vote is subject to reversal.
A change in the form of government qf a home rule city may be made only by revision of the city charter, not by amendment In Kelly v Laing, 259 Mich 212, 217 (1932), the Court stated:
“ ‘Revision’ and ‘amendment’ have the common characteristics of working changes in the charter and are sometimes used inexactly, but there is an essential difference between them. Revision implies a re-examination of the whole law and a redraft without obligation to maintain the form, scheme, or structure, of the old. As applied to fundamental law, such as a constitution or charter, it suggests a convention to examine the whole subject and to prepare and submit a new instrument, whether the desiréd changes from the old be few or many. Amendment implies continuance of the general plan and purport of the law, with corrections to better accomplish its purpose. Basically, revision suggests fundamental change, while amendment is a correction of detail.” (Emphasis added.)
The Michigan Supreme Court has examined the theory of recall on several occasions. In Amberg v Welsh, 325 Mich 285, 296 (1949), the Court stated:
“It must be borne in mind that proceedings for recall differ very materially from those for removal from office. Proceedings for removal are court proceedings and those for recall are passed upon by the electors. The leading case in this State is People eco rel Elliot v O’Hara, 246 Mich 312 (1929), wherein Mr. Justice Fead, speaking for the Court, stated:
“ Tt hardly need be pointed ont that the recall is fundamentally different from proceedings for removal of an officer. The theory of the recall is that the right of the people to revoke an official commission which they have granted is coextensive with their initial power to grant it.’ ”
As the proposal submitted to the voters institutes a fundamentally different method of removing a city manager, it follows that such a change in the charter would have to be accomplished by revision rather than amendment.
The Midland charter provides for a city council in which all of the powers of the city are vested, including direction, supervision, and policy decisions relative to the acts and duties of the city manager. He can be removed by them for cause or noncompliance.
In his written opinion, the trial court held that:
“The effect of the amendment providing for the recall of the city manager, in the opinion of this court, changes the fundamental concept of commissioner-city manager government. The charter places certain responsibilities upon the city manager. These, amongst others, consist of recommendations from him to the council and vest him with the entire administration of the city subject to the directives and policy decisions of the council. If the city manager is not performing his functions correctly, he can be removed under the charter by the city council in accordance with the procedures therein set up. Under the amendment, a city manager who is performing his duties properly, legally and in exact accordance with his instructions could be recalled merely because he had incurred the disfavor of the electorate. The effect of this provision means that the city manager would no longer be controlled by the city council but would be obliged to curry favor with the public under penalty of being recalled. In short, he could have two masters and it would be impossible for him to serve both properly. The net result of this provision, permitting the recall of the city manager, is to effectively destroy the city manager form of government, in the opinion of the court. If the directives given to the city manager by the city council are not in accordance with the wishes and desires of the public, then, the proper procedure would be the recall of the council who are elected by the public and answerable to the public for the actions of the city manager under their direction.”
We agree with the court that the innocuous-appearing proposed charter amendment would effectively destroy the city manager form of government. Such a change would result in much more than a mere amendment of ..the charter; it would constitute a substantial revision of that document.
Thus, the proposed change in the city charter should be effected by means of a charter revision, pursuant to MCLA 117.18; MSA 5.2097.
Our decision herein makes unnecessary any further discussion on the constitutional issue raised by this appeal.
The trial court’s holding that the proposed charter change was a revision and that the attempted amendment procedure was illegal and of no effect is affirmed. No costs are awarded, as a public question is involved.
All concurred. | [
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T. M. Burns, J.
About 4:30 p.m. on June 27,1964, an intersection accident occurred involving a pickup truck and a car. Robert M. Skiff, driver of the truck, was killed. Jane Elizabeth Dickens, driver of the car, survived. There were no passengers in either vehicle and no eyewitnesses except for the defendant and the deceased.
A complaint was filed on July 15, 1966, by Roy M. Skiff, administrator of the estate of the deceased, charging the defendant with negligence. A jury trial was held in January of 1969 and a verdict of no cause for action was returned. Plaintiff’s motion for a judgment notwithstanding the verdict or a new trial was denied on April 7,1969. A delayed appeal to this Court followed.
When defendant was called as a witness by the plaintiff, she testified as to the speed of each vehicle, the visibility, the evasive action taken by her, how far away she was when she saw the truck and attempted to stop, that both parties approached the intersection at the same time, that within the stopping distance she saw no cross-traffic, and how far the Skiff vehicle was into the intersection at the time of the accident. Plaintiff contends that all of the above testimony should have been excluded under the so-called “Dead Man’s Statute”, MCLA 600.2166; MSA 27A.2166, which repealed MCLA 600.2160; MSA 27A.2160.
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“(1) When an action or proceeding is prosecuted or defended by the heirs, assigns, devisees, legatees, or personal representatives of a deceased person, the opposite party, if examined as a witness in his own behalf, shall not be admitted to testify at all to matters which, if true, must have been equally within the knowledge of such deceased person. When any action or proceeding is prosecuted or defended by any surviving partner or partners, the opposite party, if examined as a witness in his own behalf shall not be admitted to testify at all in relation to matters which, if true must have been equally within the knowledge of the deceased partner, and not within the knowledge of any one of the surviving partners.”
However, the statute in force at the time of the trial provided in pertinent part:
“Sec. 2166. (1) In any action against a person incapable of testifying, a party’s own testimony shall not be admissible as to any matter which, if true, must have been equally within the knowledge of the person incapable of testifying, unless some material portion of his testimony is supported by some other material evidence tending to corroborate his claim.” (1967 PA 263.)
The trial judge, therefore, ruled that the defendant’s testimony was admissible since the statute provided for the exclusion of testimony only when an action was brought against the person incapable of testifying. In this case, of course, the person incapable of testifying is the plaintiff, and the statute would have no application.
On May 15, 1969, the Michigan Supreme Court added Court Rule 608 “effective immediately to meet an unintended discrepancy in the law”. The court rule provided:
“Rule 608. Dead Man’s Statute. Section 2166 of the revised judicature act, as amended by PA 1967, No. 263, is hereby made applicable in any action brought by or against a person incapable of testifying.”
Plaintiff now contends that he was denied a fair trial and that a grave injustice occurred because during the short period when the trial took place, the statute applied only to actions brought against the person who is incapable of testifying. At all other times since 1846, the statute has applied to both actions by or against the person incapable of testifying.
It is defendant’s position that the testimony complained of was not equally within the knowledge of the deceased and, therefore, the statute would have no application to the instant case no matter to whom it applied. We agree. Defendant testified as to her speed, her visibility, her evasive action, her distance from the intersection when she saw the Skiff vehicle, and that she saw no cross-traffic.
The matters defendant testified to are not the type which necessarily must have been equally within the knowledge of the deceased. Defendant merely testified to what she saw and how she reacted. There is no way of knowing whether deceased at any time even knew he was going to be in an accident let alone whether he observed all of the things testified to by the defendant. Indeed, deceased may not have even been aware of the speed of his own vehicle.
In Noonan v Volek, 246 Mich 377, 381 (1929), the Court made the following observation:
“Defendant was not permitted to testify that, upon approaching the wagon, he sounded his horn. The ruling was in support of an objection that the fact, if true, was equally within the knowledge of the deceased. Who knows what the deceased knew? If defendant sounded his horn and Mr. Noonan did not hear it, then the fact, if true, was not within the knowledge of the deceased at all.”
In our opinion defendant’s testimony would have been admissible even assuming the Dead Man’s Statute was in force and applicable in actions “by or against” a person incapable of testifying at the time of the trial in the instant case. We do not, therefore, find it necessary to decide whether the plaintiff was denied a fair trial due to the wording of the statute when the trial in the instant case took place.
Plaintiff next argues that the clear weight of the evidence shows that the Skiff vehicle entered the intersection first and, therefore, had the right-of-way. Plaintiff cites Scurlock v Peglow, 263 Mich 658 (1933).
Assuming that tbe testimony did establish that plaintiff entered the intersection first, our reading of the S curio ck case does not require us to hold, as a matter of law, that plaintiff then had the right-of-way. All the Supreme Court held in that case was that under all the circumstances surrounding the accident, it could not be said that plaintiff was guilty of contributory negligence or defendant free from negligence and that there was a case for the jury.
Here plaintiff’s case went to the jury, and they returned a verdict of no cause for action. Plaintiff cites no authority which would require the circuit judge or this Court to upset that verdict by granting a judgment notwithstanding the verdict or a new trial. We find no merit in plaintiff’s contention that, under the evidence, he was entitled to a judgment notwithstanding the verdict or, in the alternative, a new trial.
Plaintiff finally contends that the trial court erred in excluding testimony which would have shown that defendant parsed the intersection where the accident occurred 30 or 40 times rather than 6 times as defendant testified.
The trial court ruled that the testimony was inadmissible because it would impeach the defendant on a collateral matter. In so ruling the trial court noted that all the witness in question could testify to was that he saw the defendant pass his home and that there were two intersections where defendant could have turned between the witness’s house and the intersection where the accident took place.
The trial court correctly stated the law when he ruled that the defendant could not be impeached upon a collateral matter. See Mills v Warner, 167 Mich 619 (1911); Hall v Iosco County Board of Road Commissioners, 2 Mich App 511 (1966). Since the testimony in question is collateral to the issue of defendant’s negligence, plaintiff was bound by the answer defendant gave during cross-examination.
Affirmed.
All concurred.
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Brennan, J.
Plaintiff, Hunters Pointe Partners Limited Partnership, appeals as of right from a December 18, 1989, order granting summary disposition to defendant United States Fidelity & Guaranty Company. We reverse.
Hunters Glen, Ltd., and Hoffman Construction Company entered into a construction contract on May 6, 1981, under which Hoffman Construction agreed to act as general contractor on a project to build a 150-unit apartment complex in Southfield, Michigan. A performance bond was issued by usf&g, as surety, to secure the performance of Hoffman Construction. According to the terms of the bond, the surety would be obligated only as long as Hunters Glen paid Hoffman Construction, the principal on the bond, in strict accordance with the terms of the construction contract. In accordance with certain supplemental agreements, Hoffman Construction was entitled to a limited partnership interest in Hunters Glen, which it was required to sell to Hunters Glen upon completion of construction. The benefits inuring to Hoffman also accrued to usf&g as an inducement for its issuance of the bond. The additional payments for Hoffman’s limited partnership in the complex would have totaled $432,000, but were never made by Hunters Glen. In 1983, after construction was completed, Hunters Glen filed for bankruptcy. Pursuant to the plan of reorganization, all of its interest in the construction project was sold to plaintiff Hunters Pointe.
Plaintiff subsequently brought this suit, alleging that Hoffman Construction and usf&g must reimburse it pursuant to the construction contract and the performance bond for the expenses incurred in correcting certain defects in the project. Both par ties brought motions for summary disposition. Plaintiff argued that usf&g’s failure to defend Hoffman Construction at trial and protect its interests as surety prohibits any argument regarding the issue of damages. Usf&g argued that it was not liable under the bond because plaintiff did not pay in strict accordance with the construction contract. Usf&g further argued that the period of limitation had run on plaintiff’s claim. Finally, usf&g argued that because construction of the project was completed and plaintiff accepted the performance, defendant’s obligations under the bond were terminated. The trial court granted usf&g’s motion for summary disposition and denied plaintiff’s motion. The court found that the surety was relieved of its obligations under the bond upon completion of the project and plaintiff’s unequivocal acceptance of the project with known, patent defects. The court further found that the doctrine of collateral estoppel did not apply to the case at bar because there was insufficient identity of the parties.
Plaintiff argues that the court erred in granting summary disposition to usf&g. Plaintiff contends that, pursuant to the terms of the construction contract, Hoffman Construction was responsible for correcting all defects that were discovered within one year of completion of the project, and that, pursuant to the terms of the bond, usf&g would remain liable until Hoffman Construction fully performed in accordance with the construction contract. Plaintiff asserts that because Hoffman Construction has not corrected defects discovered within one year of completion, usf&g remains liable on the bond. Finally, plaintiff argues that the issuance of the certificate of substantial completion is not a bar to recovery where the defects are latent.
The trial court apparently granted summary disposition pursuant to MCR 2.116(0(10). A motion for summary disposition under MCR 2.116(C) (10) tests whether there is factual support for a claim. Giving the nonmoving party the benefit of the doubt, the court must determine whether a record might be developed that would leave open an issue upon which reasonable minds could differ. Pemberton v Dharmani, 188 Mich App 317, 320; 469 NW2d 74 (1991).
There is no case in Michigan directly on point. However, we note that in jurisdictions that have addressed this issue, the courts read the performance bond together with the construction contract and found that a surety could be held liable on the performance bond for a breach of the construction contract by the contractor that results in latent defects. See School Bd of Pinellas Co v St Paul Fire & Marine Ins Co, 449 So 2d 872 (Fla App, 1984), City of Gering v Patricia G Smith Co, 215 Neb 174; 337 NW2d 747 (1983), Salem Realty Co v Batson, 256 NC 298; 123 SE2d 744 (1962), and City of Osceola v Gjellefald Construction Co, 225 Iowa 215; 279 NW 590 (1938). See also 17 Am Jur 2d, Contractors’ Bond, § 34, p 771. Here the construction contract between Hunters Glen and Hoffman Construction was incorporated by reference into the performance bond. The performance bond contains the following language:
Now, therefore, the condition of this obligation is such that, if Principal shall well and truly perform all the undertakings, covenants, terms, conditions and agreements of said Contract on its part, and fully indemnify and save harmless Obligees from all cost and damage which they may suffer by reason of failure so to do, and fully reimburse and repay Obligees all outlay and expense which Obligees may incur in making good any such default, then this obligation shall be null and void; otherwise it shall remain in full force and effect.
This language clearly states that if the principal, Hoffman Construction, fails to fully perform under the construction contract, plaintiff is entitled to protection from usf&g. Therefore, we must next review the construction contract to determine if plaintiff is entitled to protection under the performance bond. Article 2, paragraph B of the construction contract provides: #
The Contractor shall correct any defects due to faulty materials or workmanship which appear within one year from the date of completion.
Article 2, paragraph D provides:
The date of completion shall be the date the hud Representative signs the hud Representative’s trip report (HUD5379) which indicates construction is complete and which report is subsequently endorsed by the Chief architect as being the final inspection report.
The hud representative signed his report on September 29, 1982. All defects that appeared between September 29, 1982, and September 29, 1983, were thus to be corrected by Hoffman Con struction. Accordingly, usf&g, in its role as surety, is liable for Hoffman’s failure to perform under the contract and correct those latent defects appearing by September 29, 1983. Assuming plaintiffs allegations are true that latent defects appeared by September 29, 1983, we find that the trial court erred in granting summary disposition to defendant. As a result of our disposition of this issue, we need not decide whether the trial court erred in finding that the doctrine of collateral estoppel is not applicable here. Further, we note that defendant has raised various issues that we decline to address because they were not raised in a cross appeal and also were not addressed by the trial court. See Kim v Ford Motor Co, 170 Mich App 544, 550; 429 NW2d 203 (1988); Swickard v Wayne Co Medical Examiner, 438 Mich 536, 562; 475 NW2d 304 (1991).
Reversed.
This is the second motion for summary disposition brought by defendant usf&g. The first motion was granted by the trial court, but was then reversed by this Court. Hunters Pointe v USF&G, 177 Mich App 745; 442 NW2d 778 (1989).
Moreover, we note that a surety’s liability corresponds exactly with that of its principal. Therefore, if the principal can be held liable for breach of a construction contract, so may the surety. Ackron Contracting Co v Oakland Co, 108 Mich App 767, 772; 310 NW2d 874 (1981). | [
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Levin, J.
The defendant, Norma White, appeals her conviction by a jury of selling or dispensing marijuana. MCLA 335.152; MSA 18.1122. Under that statute the court was required to impose a sentence of not less than 20 years nor more than life. She was sentenced to serve a term of 20 years to 20 years and 1 day.
The people’s evidence tended to show that at 10:30 p.m. on September" 5, 1969 the defendant admitted to her home James Ball, a police informer, and Joseph Young, an undercover narcotics agent for the Michigan State Police, and that she sold them a quantity of marijuana for $10, and that they left before 11 p.m.
The defense was alibi. Five persons testified that on September 5 the defendant was at a party from 6 o’clock in the evening until at least 11 o’clock.
I
During the direct examination of informer Ball and narcotics agent Young they testified that they asked the defendant whether she could furnish a quantity of “smack” and that she replied she could not. In response to the prosecutor’s follow-up question, “What does smack refer to?”, Ball said that smack is a street term for heroin.
The defendant’s attorney moved for a mistrial on the ground that his client was charged with the sale of marijuana, not the sale of heroin, and that the reference to the possibility that the defendant might be a heroin seller was prejudicial. The motion was denied. In our opinion the motion should have been granted.
This is not a case of a witness blurting out an unanticipated remark. Ball and Young were the people’s principal witnesses. They were testifying about what occurred at the defendant’s home when the marijuana was purchased. Both witnesses gave precisely the same testimony about the attempted purchase of' smack; the witnesses’ references to smack were not inadvertent. The prosecutor’s request that Ball define the term “smack” was obviously deliberate.
In the judgment of a considerable portion of the citizenry there is an enormous difference between selling marijuana and selling heroin. This judgment is reflected in the recent amendment of the statutes which reduces the maximum prison term for the “delivery” of marijuana to 4 years, while the maximum penalty for the delivery of heroin is set at 20 years. (The maximum prison term for possession of marijuana has been reduced to one year, while the maximum for possession of heroin is four years: ) These substantial differences in the maximum penalties adumbrate the extent of the difference in the public’s attitude regarding marijuana and heroin.
We are persuaded that the clear innuendo of the prosecutor’s questions and the witnesses’ responses was that the defendant, whether she could then supply heroin or not, was a seller of heroin, not just a seller of marijuana. In the light of the commonly-held attitude regarding sellers of heroin, this was highly prejudical. The jurors, who represented a cross section of the community from which they were drawn, could well have been influenced unfavorably to the defendant by the unsavory innuendo deliberately and extraneously injected by the prosecutor. A mistrial should have been granted.
II
Before the new trial the defendant may renew her motion for dismissal in the light of United States v Marion, 404 US 307; 92 S Ct 455; 30 L Ed 2d 468 (1971), and the record made at the trial and any other evidence that can be produced, on the ground that she suffered “actual prejudice” as a result of the five-month delay between the date, September 5, 1969, that the charged offense occurred, and the date, February 9, 1970, that the people obtained an arrest warrant.
There is no need to discuss the defendant’s contention that the people failed to establish that she did not have a license to sell narcotics. Recently, in People v Rios, 386 Mich 172, 180-181 (1971), the Michigan Supreme Court outlined procedures that can be followed in making such proof.
The photograph of the defendant taken, according to the photographer, at the party between 8 and 9 o’clock on the evening in question, and the photographs of other persons said to have been taken at the party between 7:30 and 10:30 o’clock tend to corroborate the testimony of the defendant and her alibi witnesses that there was a party which the witnesses and the defendant attended. Although the time sequences during which the photographs were taken do not obviate the possibility that the defendant was both at the party and made the illegal sale between 10:30 and 11 o’clock, the photographs were of some probative value.
During his cross-examination of one of the alibi witnesses, the. prosecutor asked the witness whether she had made certain statements to the police. At the time, the prosecutor was holding a document in Ms hand. After he fiMshed tMs line of questioning the defendant’s lawyer asked to see the “statement”. The judge refused to allow him to see the document saying that “there was no statement read into the record. Hé had a pencil and paper in his hand. He asked this witness if she made certain oral statements to the man that visited her”. During oral argument in our Court an assistant prosecutor indicated that the trial prosecutor may have been bluffing — that there was no written statement or memorandum of a statement of the witness.
The defendant’s trial lawyer needed to see the document in the trial prosecutor’s hand to determine whether its contents might enable Mm to rehabilitate the credibility of the witness which had been weakened by the innuendo that she had given a different account to the police reflected in the document. After the witness had finished her testimony, there could be no justification for shielding the document from scrutiny. Even if — and on this we need intimate no opinion — a prosecutor may properly attempt to bluff a witness, he has no right to bluff the jury. The judge should have directed the prosecutor to yield the document for examination so that the jury might become apprised of its true contents.
Tbe judge did not err in allowing the technician employed by the Kalamazoo Police Department to testify that in his opinion the substance purchased from the defendant was marijuana.
The contention that Ball and Young should not have been permitted to relate statements alleged to have been made by the defendant when she sold them the marijuana because before the statements were made an investigation had focused on her and she was, therefore, entitled to the protection of an advance independent judicial determination of probable cause before the investigating team “invaded” her privacy and to be represented by counsel during the “interrogation” that led to the claimed unlawful sale is, in the present state of the law, manifestly without merit.
There was sufficient evidence to support the jury’s verdict.
Beversed and remanded for a new trial.
T. M. Burns, J., concurred.
1971 PA 196, § 41; MCLA 335.341; MSA 18.1070(41).
See People v Greenway, 365 Mich 547, 551 (1962); People v Camel, 11 Mich App 219, 221 (1968); People v Ignofo, 315 Mich 626, 636 (1946); People v Montevecchio, 32 Mich App 163 (1971) ; People v Milkovich, 31 Mich App 582, 585 (1971); Cachola v The Kroger Co, 32 Mich App 557, 558 (1971).
“Events of the trial may demonstrate actual prejudice”. United States v Marion, 404 US 307, 326; 92 S Ct 455, 466; 30 L Ed 2d 468, 482 (1971).
It appears that the court reporter was under the impression that the trial prosecutor was purporting to read from the document he was holding in his hand. The reporter placed the portions of the prosecutor’s questions consisting of the statements allegedly made by the witness to the police in quotation marks, viz:
“Q. Did you tell the detective you stated at that party, 'Well, it is 11 o’clock, and Norma and I have to go to work.’?
“A. If he got that down there, I must have said it.
“Q. I am asking you if you told him that?
“A. I don’t know. If he has got it there, I must have said it.”
Cf. People v Dellabonda, 265 Mich 486, 499 (1933); People v Marra, 27 Mich App 1, 7, 14 (1970).
Cf. People v Wimberly, 384 Mich 62, 68 (1970), where the Michigan Supreme Court declared: “Once a witness has testified at trial we hold as a matter of law that the traditional reasons for secrecy no longer exist and, as a matter of right, the defendant is entitled to all the testimony that witness gave before the grand jury relevant to the defendant’s guilt or innocence.” | [
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J. H. Gillis, J.
From the entry of a summary judgment (pursuant to GrOR 1963, 117) in favor of the plaintiff in each of six eases which had been consolidated in recognition of their common issues, defendants bring this appeal.
Following the assessment by defendants of real property taxes against plaintiff for the years 1966, 1967, and 1968, an appeal was taken to the State Tax Commission (hereafter designated as STC) pursuant to § 152 of The General Property Tax Act (MCLA 211.152; MSA 7.210). Subsequently, and in compliance with § 53 of The General Property Tax Act (MCLA 211.53; MSA 7.97) plaintiff, following the payment under protest of said assessed taxes, instituted suits in the circuit court for refund. The common allegation of the plaintiff in the several complaints was as follows:
“Plaintiff avers that said assessment valuation, and the resultant assessments and tax levied against the property here involved, were far in excess of the applicable ratio of assessment to true cash value under the law of the State of Michigan in such case made and provided; were and are excessive and discriminatory and based upon wrong principles of assessments; that thereby plaintiff was over-assessed, deprived of its property without due process of law, and denied the equal protection of the law.”
The STC’s determination (which affirmed the taxing authorities’ position) was then appealed directly to the Supreme Court upon grant of petition to bypass the Court of Appeals. In Fisher-New Center Co v State Tax Commission, 380 Mich 340 (1968), rev’d on rehearing, 381 Mich 713 (1969), the Court held invalid, because unrelated to true cash value, the formulas by which the plaintiff’s real property had been assessed by the City of Detroit and the STC. In December, 1970, the STC rescheduled for hearing and determination both the assessments involved in the earlier appeal and also the assessments which had in the meantime been made by defendants and appealed by the plaintiff. As a result of said hearings, the STO, on January 22, 1971, issued formal orders determining the lawful assessment of the plaintiff’s property for the years in question. Each of the several orders included a determination as to both the true cash value of the plaintiff’s property and the prevailing ratio or level of assessment in the City of Detroit for the applicable year. None of the STC orders was appealed by either side.
Plaintiff then filed its motion for summary judgment in the instant consolidated circuit court actions based upon the unappealed revised assessments contained in the STC’s decisions and orders. In response to said motion, defendants, although admitting the finality of the STC’s findings regarding the true cash value, disputed the commission’s determinations as to average levels of assessment. Partial summary judgments were entered on April 30, 1971 as to the uncontested portion of the refund, accruing to plaintiff resulting from the STC’s redetermination of the true cash value. Proceedings were then held on the contested portion of the refund claims resulting in the entry on May 14, 1971, of supplemental summary judgments in favor of the plaintiff pursuant to the STC’s determination regarding the average levels of assessment. At the hearing on the motion for supplemental summary judgment, defendants introduced four affidavits in opposition to said motion, all of which alleged that the STC had made an error of law or had adopted wrong principles in arriving at the average level of assessment for the City of Detroit.
In lieu of these charges defendants bring this appeal claiming the circuit judge was in error in concluding he did not have jurisdiction to consider defendants’ allegations, and, hence, granting plaintiff’s motion for summary judgment, thereby denying a trial on said issue. Plaintiff, on the other hand, contends that the trial court was correct in ruling that the defendants had not pursued their appeal of the STC’s decision through the proper channels (i.e., to the Court of Appeals), that the decision must be regarded as final in that court, it having no jurisdiction to review the matter. Therefore, plaintiff concludes there being no other material issue of fact presented so as to preclude the entry of a summary judgment, the circuit judge was not in error in doing so.
Public Act 270 of 1969 amended § 152 of The General Property Tax Act (MCLA 211.152; MSA 7.210) by providing that the “contested case” provisions of the Administrative Procedures Act of 1969 (MCLA 24.271-24.287; MSA 3.560 [171-187]) are inapplicable to the STC, and that “in its determination, art 6, § 28 of the Constitution of the State of Michigan shall apply.” Section 28 provides that “in the absence of fraud, error of law or the adoption of wrong principles, no appeal may be taken to any court from any final agency provided for the administration of property tax laws from any decision relating to valuation or allocation.” Thus, the standard of review from an STC determination has been established — its decision is final unless fraud, error of law, or misapplication of principles is demonstrated. As for the avenues of review that are open to a particular entity, resort must be had to the applicable statutes for such a determination.
At the outset, a basic distinction must be recognized between the position of the two different entities who would seek to appeal from an STC determination. While the Legislature has given taxpayers alternative remedies — of either (1) appealing to the STC (pursuant to § 152 of The General Property Tax Act, MCLA 211.152; MSA 7.210) and/or (2) paying the tax under protest and suing in the circuit court for refund (pursuant to § 53 of The General Property Tax Act, MCLA 211.53; MSA 7.97) — it has not expressly provided such alternative remedies to the taxing authorities. Section 53 of The General Property Tax Law is solely a remedy granted to a taxpayer. Nothing in said section authorizes a taxing entity to use such a proceeding. Hence, the only remedy provided under the statute for a taxing authority that is aggrieved by a decision of the STC is to prosecute an appeal to the appellate courts of this state. None of the cases cited by the appellants nor any that have been found by this Court support the argument that the assessing entities have a remedy under § 53. Said cases deal solely with the scope of a taxpayer’s right to bring a circuit court suit under § 53 of the act for recovery of allegedly excessive taxes. Moreover, the decisions make clear that even the taxpayer is bound by a STC determi nation in the absence of proof of fraud, error of law, or application of wrong principles.
Perhaps the confusion over the applicability of § 53 results from the fortuitous circumstance that although § 152 of The General Property Tax Law authorizes the STC to hear assessment appeals, it fails, however, to explicitly provide the commission with authority to order or enter judgment for the enforcement of its refund orders. Therefore, as an excess of caution, lawyers, who have appeals pending before the STC and whose clients are obligated, during the pendency of appeal, to pay the tax, do frequently advise their clients to pay the tax under protest and commence a § 53 action for refund. However, as the language of § 53 clearly demonstrates the remedy was provided to enable a taxpayer to recover a refund of taxes that are shown to be void as a result of a determination on the merits by the circuit court and was not designed as an aid in the enforcement of orders of the STC. Minor Lumber Co v Alpena, 97 Mich 499, 500 (1893); Turnbull v Alpena Twp, 74 Mich 621, 627 (1889).
In the case at bar the taxing authorities did not appeal the STC’s determination against them to our Court as all agree they might have done. The taxpayer, by making use of his alternative remedy under § 53 during the pendency of his appeal to the STC, in order to protect himself in case the commission’s determination was adverse to him, cannot be said to have given the taxing authorities an alternative forum in which to review the decision of the STC when said commission held against it. The taxpayer no longer needed his alternative remedy once it won before the STC. His utilization of the refund action as a means or vehicle of enforcing the STC order did not permit a reopening of the meritorious issues decided by the STC. As subordinate officials under the STC’s supervisory jurisdiction, the assessing authorities’ position is wholly different from the statutory remedy accorded solely to a taxpayer under § 53 of the act.
Under defendants’ theory herein, the city need only refuse to refund the excess tax determined by the STC, relegate the taxpayer to an action in circuit court, and then demand a retrial of the same factual issues already decided by the STC. When the STC’s decision determining that the assessment was excessive became final, the city became obliged to refund tihe taxes excessively collected on the basis of that erroneous assessment. That obligation to make refund arose by implication under the provisions of The General Property Tax Law authorizing the STC to hear and decide tax assessment appeals and conferring on the STC general supervisory authority over subordinate tax assessing officials. The city’s obligation to refund taxes that the STC determines have been excessively assessed and collected does not depend on whether the taxes excessively collected have been paid under protest or whether an action for refund has been commenced under § 53 of The General Property Tax Law.
The circuit court had no alternative but to grant the motion for summary judgment directing the payment of a refund of the taxes. With respect to defendants-appellants the STC decision had become final.
Affirmed. Costs to appellee.
All concurred.
Pending the hearing and determinations of said appeals, plaintiff likewise paid these subsequent assessments under protest and instituted circuit court actions seeking refunds.
The circuit court suits reached the pretrial stage prior to the STC scheduling of the pending appeals. Plaintiff requested the circuit judge, who was conducting the pretrials, to adjourn said pretrials for the specific reason that the STC had already acquired prior jurisdiction to determine the lawful assessments for the subject property. Plaintiff contended the STC decision would be determinative of the issues raised in the circuit court suits. The court agreed with this contention and adjourned the pretrial hearings to await the STC determination. Defendants’ application for leave to appeal this, ruling to the Court of Appeals was denied.
The practice of taxpayers challenging the validity of a tax commission decision by a § 53 suit for refund is well established in this state. Kingsford Chemical Co v City of Kingsford, 347 Mich 91 (1956); Naph-Sol Refining Co v Twp of Muskegon, 346 Mich 16 (1956); Helin v Grosse Pointe Twp, 329 Mich 396 (1951); Fruehauf Trailer Co v Detroit, 325 Mich 407 (1949); Moran v Grosse Pointe Twp, 317 Mich 248 (1947); S S Kresge Co v Detroit, 276 Mich 565 (1936); Hoerner-Waldorf Corp v Ontonagon, 26 Mich App 542 (1970); Hudson-Webber Realty Co v Southfield, 18 Mich App 66 (1969).
“The person paying under such protest may, within 30 days and not afterwards, sue the township for the amount paid, and recover, if the tax or special assessment is shown to he illegal for the reason shown in such protest.” (Emphasis supplied.) | [
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Per Curiam.
Defendant appeals as of right a postjudgment alimony award made thirteen years after the original judgment of divorce pursuant to a "reservation of alimony” clause in the original judgment.
The parties were married in 1953 and divorced in 1974. Plaintiff became unable to work in 1985, depleted her life savings, and filed a petition for alimony in 1987. The petition was brought pursuant to a provision in the original judgment stating: "The Court shall reserve the right to rule on alimony when a petition for same is submitted. The Court shall maintain jurisdiction to this end.”
Extensive evidentiary hearings revealed that the sixty-four-year-old plaintiff was in poor health. She received approximately $157 a week, not including money she borrowed from her friends, and her expenses approximated $466 a week. The sixty-four-year-old defendant was semiretired from a job that paid $50,000 a year. He received $235 a month from a military pension and claimed $2,000 a month in shared rental income. He owned $190,000 in stock and received $135,000 from a lawsuit pending at the time of the divorce. He was also waiting until he reached the age of sixty-five to receive two other pensions. Plaintiff’s attorney presented information that computed defendant’s net income at $2,200 a week, including deprecia tion on his commercial properties, but excluding losses. On February 8, 1991, the trial court ordered defendant to pay plaintiff $200 a week in permanent alimony.
On appeal, defendant claims that plaintiffs claim is barred by the ten-year period of limitation applicable to enforcement of divorce judgments, MCL 600.5809(3); MSA 27A.5809(3). We disagree. The ten-year limitation period begins to run against each alimony installment when it becomes due. Rybinski v Rybinski, 333 Mich 592, 596; 53 NW2d 386 (1952); Gabler v Woditsch, 143 Mich App 709, 711; 372 NW2d 647 (1985). In the present case, alimony payments had not yet become due at the time of plaintiffs petition. Therefore, the ten-year period of limitation related to actions to enforce noncontractual money obligations had not yet begun to run on this unaccrued alimony claim. MCL 600.5809(1); MSA 27A.5809(1). An obligation to pay alimony may be modified where alimony was awarded or explicitly reserved as a possibility in the divorce judgment. Copeland v Copeland, 109 Mich App 683, 686; 311 NW2d 452 (1981). See also McCoy v McCoy, 317 Mich 478, 481; 27 NW2d 62 (1947). Because the plaintiff was seeking modification of the original judgment, the enforcement provision of MCL 600.5809(3); MSA 27A.5809(3) was not triggered. Plaintiffs petition for alimony was not barred.
Defendant also claims that the trial court’s findings of fact were insufficient to facilitate appellate review of this case. This Court reviews findings of fact for clear error. Beason v Beason, 435 Mich 791, 805; 460 NW2d 207 (1990); Beckett v Beckett, 186 Mich App 151, 153; 463 NW2d 211 (1990). Although the trial court did not specifically articulate whether defendant’s assets generated income to satisfy his alimony obligation, its findings were based in part upon defendant’s extensive property holdings. In addition, tax returns showed that defendant should readily be able to meet the alimony obligation. The trial court’s factual findings were supported by the evidence and are not clearly erroneous.
Defendant next claims that plaintiff did not sustain her burden of proving his ability to pay and that the trial court’s order to pay plaintiff $200 a week far exceeded his income. The award of alimony is in the trial court’s discretion. Pelton v Pelton, 167 Mich App 22, 27; 421 NW2d 560 (1988). This Court reviews alimony orders de novo and will not modify an award unless it is convinced that, sitting in the trial court’s position, it would have reached a different result. Parrish v Parrish, 138 Mich App 546, 553; 361 NW2d 366 (1984). In this case, the trial court reviewed extensive evidence and considered the required alimony factors. Thames v Thames, 191 Mich App 299, 308; 477 NW2d 496 (1991). Evidence presented by plaintiff indicated that defendant’s weekly income is sufficient to pay the ordered amount. The trial court’s findings are supported by the record and are not clearly erroneous.
Defendant next claims that he should not be compelled to encumber or invade the corpus of his joint assets in order to meet the alimony obligation. MCL 552.23; MSA 25.103 gives the court the authority to use real estate as the source of an alimony award. Income has been broadly interpreted to include capital gains from the sale of assets, and not just net taxable income for federal income tax purposes. Gaylord v Stuart, 372 Mich 216, 218; 125 NW2d 485 (1964). In dicta, this Court has indicated that a court could allow, but need not require, a party to invade the corpus of its assets to pay alimony. Zecchin v Zecchin, 149 Mich App 723, 735; 386 NW2d 652 (1986). The main objective is to balance the incomes and needs of the parties in a way that would not impoverish either party. Id. The evidence presented indicated that plaintiff was close to impoverishment and defendant was well established, with many property holdings, two expected pensions, and other income. The trial court did not err in ruling that, despite defendant’s claims of low net income, defendant had many other sources from which to pay alimony. The trial court did not require defendant to invade the corpus of his assets, nor did defendant present evidence that he would need to sell or mortgage properties to meet the alimony obligation. For these reasons, this issue lacks merit.
Defendant finally argues that plaintiff’s claim is barred by laches. Unlike the statute of limitations, which is concerned with the time of the delay, the concern of laches is the effect of or prejudice caused by the delay. Eberhard v Harper-Grace Hosps, 179 Mich App 24, 38; 445 NW2d 469 (1989); Lothian v Detroit, 414 Mich 160, 168; 324 NW2d 9 (1982). A passage of time, prejudice to defendant, and lack of diligence by the plaintiff are essential prerequisites to invoking laches. In re Crawford Estate, 115 Mich App 19, 26; 320 NW2d 276 (1982). There is no basis for defendant’s laches defense under these facts. Although there was a considerable length of time between the original judgment and the petition for alimony, plaintiff did not petition for alimony until she needed it, and defendant was not prejudiced.
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McGregor, P. J.
This case is a familiar one by now, as it reaches us for the fourth time, in what is hopefully the last of its many journeys through the appellate machinery. Though the facts are, in substance, uncommonly simple, a barrage of legal maneuvers has rendered the case uncommonly confused. What began as a simple motor vehicle negligence case has ascended to the complexities of a multifaceted action for contribution.
On September 2, 1965, Mary Paisley, then a three-year-old child, was playing in back of a gasoline service station owned by Gulf Oil Corporation and leased by Carleton Holtz, when a delivery truck owned by United Parcel Service and driven by John Michelin arrived to do business with Reveo. Michelin drove east through an alley, paused, and backed his truck up to a loading dock behind the Reveo building. As he did so, he noticed Mary Paisley playing in the area behind Holtz’ service station. This area, along with the paved apron to the loading dock, also belonged to Gulf Oil Corporation and was leased by Carleton .Holtz. As Michelin loaded his parcels into the truck, he noticed Mary Paisley near the truck, whereupon he told her to get away from the truck. Having completed his loading, Michelin entered the cab of the truck and proceeded to make an entry in his logbook regarding the packages he had loaded. During the nearly 45 seconds it took him to do this, he did not observe Mary Paisley. When he started to drive away he did not see her or her tricycle. The truck moved about one length before he stopped and discovered Mary on the pavement under his truck. Mary received extensive injuries.
Plaintiffs commenced action against United Parcel Service on October 31, 1966, alleging negligence in the operation of the truck. Defendant United Parcel answered by way of general denial and. counterclaimed for contribution, based on negligent supervision of Mary Paisley. Plaintiffs responded, asserting that the negligence of defendant United Parcel was “the sole and proximate cause of the injuries sustained by Mary Paisley”.
Defendant United Parcel Service then filed a third-party complaint for contribution against Gulf Oil Corporation, Carleton Holtz, and Reveo, Incorporated, setting forth in substance the theory of attractive nuisance. Gulf Oil Corporation moved for summary judgment, based on its lack of control of the premises involved. The trial court entered such summary judgment, which was affirmed on appeal. Paisley v United Parcel Service, Inc, 14 Mich App 301 (1968). Revco, having likewise moved for summary judgment, based on lack of control of the premises, was granted such judgment by the trial court, which was affirmed on appeal. Paisley v United Parcel Service, Inc, 17 Mich App 672 (1969).
In the interim, Carleton Holtz had moved for summary judgment, based on the assertion that plaintiffs’ complaint did not allege concurrent or joint negligence and, therefore, defendant-third-party plaintiff United Parcel Service had not alleged facts sufficient to state a cause of action for contribution. This motion was denied. Holtz then filed a third-party complaint against Reveo, alleging a joint tortfeasor claim for contribution. Reveo moved for summary judgment on Holtz’ third-party complaint for failure to state a cause of action. The trial court denied Reveo’s motion.
To recapitulate, the result of the foregoing procedures produced the following:
(1) Richard Paisley and Lillian Paisley, as guardians of Mary Paisley, a minor v. United Parcel Service, Inc. (for simple negligence in the operation of their truck).
(2) United Parcel Service, Inc. v. Carleton Holtz (for contribution as joint tortfeasor).
(3) Carleton Holtz v. Reveo, Inc. (for contribution as joint tortfeasor).
At this juncture, defendant-third-party plaintiff United Parcel Service entered into and satisfied a $13,000 consent judgment with plaintiffs. Holtz and Reveo then moved for summary judgment, based on the consent judgment. The trial court denied both motions. (Leave to appeal was denied to both Holtz and Reveo by the Court of Appeals on May 25,1970.) Holtz also moved for a summary judgment, based on defendant-third-party plaintiff’s second amended complaint. This motion was denied.
When the case proceeded to trial, only the claims of United Parcel Service and Carleton Holtz for contribution remained in issue. The jury returned a verdict in favor of defendant-third-party plaintiff United Parcel Service against third-party defendant Carleton Holtz, and in favor of third-party plaintiff Holtz against third-party defendant Reveo. Holtz then moved for judgment notwithstanding the verdict or a new trial. The trial court denied both motions. Third-party-defendant-third-party-plaintiff Holtz brings this appeal as of right.
The basic issue on appeal is whether the trial court erred in denying third-party defendant Holtz’ motion for summary judgment, based on defendant-third-party plaintiff’s second amended complaint.
The third-party complaint by United Parcel Service is a complaint for contribution. The fact that this second amended third-party complaint may set forth a cause of action on behalf of the initial plaintiffs does not dispose of third-party defendant’s motion for summary judgment. In order to withstand a motion for summary judgment, this second amended third-party complaint by United Parcel Service must set forth a cause of action for contribution.
The action for contribution is founded solely on statute, for at common law, tortfeasors were allowed no right of contribution. MCLA 600.2925(1) MSA 27A.2925(1), provides:
“Whenever a money judgment has been recovered jointly against 2 or more defendants in an action for bodily injury or death resulting therefrom, or property damage, and such judgment has been paid in part or in full by 1 or more of such defendants, each defendant who has paid more than his own pro rata share is entitled to contribution with respect to the excess so paid over and above the pro rata share of the defendant or defendants making such payment. Joint tort-feasors who are summoned in as third party defendants pursuant to court rule may likewise be liable for contribution. No person may be compelled to pay to any other defendant an amount greater than his pro rata share of the entire judgment.”
Third-party defendant Holtz was in fact summoned pursuant to GUR 1963, 204.1(1), as provided in the above-quoted statute. It is clear that the liability, if any, of third-party defendant Holtz to third-party plaintiff United Parcel is for contribution.
A careful reading of defendant-third-party plaintiff’s second amended complaint reveals that this complaint sets forth potential liability of third-party defendant Holtz to plaintiffs, yet fails to allege that third-party defendant Holtz is a joint tortfeasor with United Parcel Service. This cause of action delineated in the third-party complaint appears to be one of attractive nuisance. Noteworthy is the fact that the initial complaint by plaintiffs against defendant-third-party plaintiff was founded on automobile negligence, not attractive nuisance. Thus, while plaintiffs might have sued United Parcel Service and Holtz jointly on an attractive nuisance theory (which may have opened the door for a contribution claim), the fact remains that they did not.
Essential to the success of the second amended third-party complaint is a specific allegation of joint tortfeasor status or an allegation of facts giving rise to such an inference.
In Moyses v Spartan Asphalt, 383 Mich 314, 331-332 (1970), the Supreme Court considered the language of MCLA 600.2925; MSA 27A.2925, and stated:
“Presumably the 1939 draft was before the Legislature and its drafting committee when the purposeful phrasing of the 1941 act was written up and enacted. The same must have held true of the 1955 draft when the EJA was written and enacted in 1961. Certainly the Michigan decisions cited post must have been at hand, particularly Geib v Slater, the then most recent dissector of § 2925’s immediate prototype, the act of 1941. From all this it must be assumed that the employment of ‘joint tortfeasors,’ appearing as it does four times in § 2925, was both advertent and exclusive of what in (3) of § 2925 was permitted in favor of liability insurers only, that is, contribution arising out of a judgment against persons ‘jointly or severally liable.’ In veritable sum, ‘joint tortfeasors’ only, not other grades or types of severally liable tortfeasors, may upon third-party discretion of the court have contribution under the second sentence of § 2925(1). This follows, the Court having found it unnecessary to decide, in Morqan v McDermott (1969), 382 Mich 333, whether § 2925, with or without permitted impleader, was intended to provide the substantive right of contribution between and among joint tortfeasors.
“When one speaks specifically of joint tortfeasors, he does not refer (a) to wrongdoers the liabilities of whom arise out of variant legal positions, the concurrently applied hut legally different derelictions of whom make them severally responsible to the plaintiff in damages, or (b) to the acts or omissions of several who act independently rather than in concert, or (c) to those who may — under present rules of court — be joined as defendants, by the plaintiff (see G-CR 1963, 206), and held responsible to him for damages sustained on account of their causally cooperating but non-joint acts or omissions, say by the negligence of one, the violation of a statute like the dramshop act by another, and the breach by still another of an express or legally implied warranty. See the exhaustive opinion Judge Levin recently prepared for Duncan v. Beres (1968), 15 Mich App 318, and the exemplary cases of Virgilio v. Hartfield (1966), 4 Mich App 582, Boucher v. Thomsen (1950), 328 Mich 312, Geib v. Slater (1948), 320 Mich 316 and Detroit, G. H. & M. R. Co. v. Boomer (1916), 194 Mich 52.”
The Court in Moyses simply overruled “the remnants of Michigan’s common-law rule which— loosely — had barred ‘wrongdoers’ from the equitable right of contribution where, by the standards of equity, that right exists generally”. 383 Mich 314, 329. The Court caused its holding to be retroactive to include any claims for contribution having arisen on or after August 12, 1969. Defendant-third-party plaintiffs’ cause of action for contribution matured on March 20, 1969, with the satisfaction of the $13,000 consent judgment. Thus, the general common-law bar to contribution was applicable to the instant case and only such contribution as was allowed by MCLA 600.2925; MSA 27A.2925 was available to third-party plaintiff.
The language of Moyses, supra, clearly points to the conclusion that United Parcel Service and Carleton Holtz were not joint tortfeasors. As such, no contribution was available upon the second amended complaint of third-party plaintiff United Parcel Service.
The trial court should have granted third-party defendant Holtz’ motion for summary judgment.
Reversed.
All concurred. | [
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Fitzgerald, P. J.
Plaintiff appeals as of right from a judgment entered on October 26, 1970, pursuant to a jury verdict of no cause of action in favor of defendants, rendered on September 30,1970.
At approximately 5:30 p.m. on the afternoon of October 29, 1967, plaintiff was seated in the right front seat of an automobile which had stopped for a traffic signal at an intersection in Battle Creek. While stopped for the traffic signal, the car in which plaintiff was riding was struck from behind by another vehicle owned by defendant Otis Carson and being driven by defendant Beatrice Carson. It had been raining most of the day, and the pavement was wet at the time of the accident. The resulting impact caused plaintiff to be thrown frontward and backward and broke the front bench-type seat of plaintiff’s vehicle.
After the accident, plaintiff complained of neck pain and was x-rayed and treated at the emergency room of a local hospital. X-rays at this time showed moderately-advanced degenerative arthritic changes in the cervical spine which most likely antedated the date of the accident. Plaintiff was treated symptomatically at this time for acute cervical strain.
Defendant stated that she was following at least two car lengths behind plaintiff’s vehicle. She had her lights and windshield wipers working and had made several stops previously and had experienced no sliding or skidding on the wet pavement. She stated she was not watching the lights of plaintiff’s vehicle, but was watching the car itself, that she observed said vehicle come to a stop, that she then applied and pumped her brakes, but her vehicle inexplicably slid into the rear of plaintiff’s stopped car.
Defendant estimated her speed prior to the accident at approximately 15-20 miles per hour and stated that given her speed and her following distance, she believed she should have been able to stop in time to avoid a collision, except for the unexpected and unexplained slipperiness which caused her vehicle to skid. Although testimony by the investigating police officer adverted to the fact that an accumulation of oil on the highway can sometimes result in slippery patches at the onset of a rain, there was no testimony in this ease which indicated that such a condition existed at the time and place of the collision. Furthermore, this officer testified that the oil slicks are usually washed away after the first hour or so of rain.
An orthopedist who treated plaintiff for some time following the accident testified that plaintiff first complained of back pain on December 5,1967. Since plaintiff’s complaint of low back pain and diminished capacity resulting therefrom constituted the gravamen of her action, defendants sought to show that since plaintiff’s complaint of back pain followed the accident by over one month, it was unlikely that said back ailment was causally related to the collision. The witness stated that in his opinion plaintiff’s symptoms of neck discomfort seemed definitely related to the accident, but added that it was conceivable that plaintiff’s pre-existing arthritic condition was aggravated by the accident. Testimony of other treating physicians was conflicting, creating a large number of questions for jury consideration.
Plaintiff also produced testimony of several friends and acquaintances who commented upon plaintiff’s diminished capacity due to back pain following the accident.
After the jury verdict in favor of defendants, plaintiff moved for a new trial claiming that the verdict was contrary to law and against the great weight of the evidence. The trial court denied plaintiff’s motion and appeal followed.
The issues will be treated in seriatim:
1. Did the trial court err in refusing to grant plaintiff a directed verdict?
Plaintiff’s complaint alleged that defendants violated the following statutory provisions: MCLA 257.627; MSA 9.2327 (assured clear distance statute); MCLA 257.643; MSA 9.2343 (following too closely); and MCLA 257.402; MSA 9.2102 (rear-end collision raising presumption of negligence). The trial court properly instructed the jury regarding the contents of these statutes and the legal effect of a jury finding that defendant Beatrice Carson had violated any or all of the said statutes. At the close of plaintiff’s evidence, plaintiff’s attorney moved for a directed verdict on the ground that defendants were negligent as a matter of law. This motion was denied by the trial judge. Plaintiff renewed her motion at the conclusion of defendants’ evidence and the motion was again denied. Plaintiff now contends that the trial court’s denial of these motions constituted prejudicial error.
In reviewing the trial court’s denial of a directed verdict in favor of plaintiff, the evidence must be viewed in the light most favorable to defendants. McKinney v Anderson, 373 Mich 414 (1964). If the evidence, when so viewed, could lead reasonable men honestly to reach different conclusions upon the questions presented, the issue is one for the jury and not for the court. Anderson v Gene Deming Motor Sales, Inc, 371 Mich 223 (1963). Utilizing this standard, and following the format in defendants’ brief, the questions presented by plaintiff’s first issue will be discussed under two general topics.
A. MCLA 257.402; MSA 9.2102 (Rear-end Collision Raising Presumption of Negligence).
Under this statute, a motorist who collides with the rear end of another vehicle traveling ahead and in the same direction is presumed negligent. Both parties admit that this statute was applicable under the facts pertaining in the case at bar. The pre sumption raised by this statute is, of course, a rebuttable one. Garrigan v LaSalle Coca-Cola Bottling Co, 362 Mich 262 (1961); Patzer v Bowerman-Halifax Funeral Home, 370 Mich 350 (1963). However, the usual grounds relied upon for rebuttal of this presumption are encompassed in the so-calle'd “sudden emergency doctrine”, which does not appear in the instant ease.
Defendants contend, however, that the “sudden emergency doctrine” is not the sole basis for rebutting the presumption of negligence arising from the rear-end collision statute.
The general rule appears to be that evidence required to rebut this presumption as a matter of law should be positive, unequivocal, strong, and credible. Krisher v Duff, 331 Mich 699 (1951); Petrosky v Dziurman, 367 Mich 539 (1962). In the case at bar, defendant driver contended that she was at all times driving in a reasonable and prudent manner.
Although the issue presented here is a close one, the trial court was correct in its decision that there was sufficient evidence on the issue of reasonable care to present a factual consideration for the jury and to preclude a directed verdict for plaintiff as a matter of law. Although the statutory presumption of negligence was certainly not rebutted by defendants’ evidence as a matter of law, the trial court decided that there was sufficient evidence at least to generate a jury question regarding rebutting of the presumption.
B. MCLA 257.627; MSA 9.2327 (Assured Clear Distance Statute), and MCLA 257.643; MSA 9.2343 (Following Too Closely).
The following quotation from Hackley Union Nat’l Bank & Trust Co v Warren Radio Co, 5 Mich App 64, 71 (1966), indicates the current standard applicable to interpretation of the above-cited statutes :
“Whereas, at one time, the application of the statute (assured clear distance) was strictly construed and applied as evidenced by the rule in the case of Lewis v Yund, 339 Mich 441 (1954), recent cases indicate that the statute must be reasonably construed and exceptions to the statutory edict have been created to accomplish justice, including bringing the assured clear distance rule to qualification by the test of due or ordinary care, exercised in the light of the attending conditions. Sun Oil Company v Seamon, 349 Mich 387 (1957); Nass v Mossner, 363 Mich 128 (1961); Dismukes v Michigan Express, Inc, 368 Mich 197 (1962).”
See Hendershot v Kelly, 11 Mich App 173 (1968). The qualification applying to the assured-clear-distance statute as enunciated in the above quotation is also applicable to the rule against following too closely. Hendershot v Kelly, supra.
Since there was at least some evidence that defendant driver was operating her vehicle in a reasonable and prudent manner prior to the accident, the question of whether or not defendant violated one or both of these statutes was properly a factual one for the jury to resolve.
2. Was the verdict of no cause for action rendered by the jury manifestly contrary to the great weight of evidence¶
Plaintiff secondly contends that the jury verdict was manifestly contrary to the great weight of evidence, arguing that the jury, in returning its verdict of no cause for action, must have concluded that there was no negligence on defendants’ part, since plaintiff contends that a hospital bill incurred by plaintiff for emergency-room treatment following the accident clearly demonstrates the element of damages.
It is unfortunate that a special verdict under GCR 1963, 514 was not rendered in the case at har. Since only a general verdict was returned, it is impossible to state with certainty whether the jury found that defendants were not negligent, or if negligent, that said negligence was not a proximate cause of the accident, or, if defendants were negligent and said negligence was a proximate cause of the accident, whether plaintiff suffered no damage as the result.
In reviewing a jury verdict, the appellate court will not reverse the jury merely because it is possible or even probable that the appellate court would have reached a different conclusion had it been the trier of facts, at least where there is testimony to support the jury verdict.
3. Did the trial court err in excluding evidence regarding a traffic ticket to defendant, Beatrice Carson, as a result of the collision with plaintiff’s automobile?
Plaintiff claims she, suffered prejudicial harm as a result of the trial court’s action in striking as not relevant certain testimony by a district court clerk regarding a traffic ticket which defendant received as a result of the accident, and in instructing the jury to disregard said testimony. Considerable testimony and colloquy preceded the court’s ruling. Evidence of a traffic conviction is inadmissible as substantive evidence in civil actions. MCLA 257.731; MSA 9.2431 states:
“No evidence of the conviction of any person for any violation of this chapter or of a local ordinance pertaining to the use of motor vehicles shall be admissible in any court in any civil action.”
See, also, Dudek v Popp, 373 Mich 300 (1964). Evidence of defendants’ conviction of the traffic violation was therefore properly excluded by the trial court in the instant case. Such evidence could have been utilized on plaintiff’s cross-examination of defendant driver, but that was not done in the case at bar. See GCR 1963, 607; Sting v Davis, 384 Mich 608 (1971); Taylor v Walter, 384 Mich 114 (1970), on rehearing 385 Mich 599 (1971). See, also, Zimmerman v Goldberg, 277 Mich 134 (1936). A further consideration is that the ordinance in question had not been properly pleaded.
The fact that a party was issued a traffic ticket is not barred from evidence by statute, court rule, or case law. Dudek v Popp, supra. However, plaintiff has no cause to complain in this regard since the transcript clearly shows that evidence concerning issuance of a traffic citation to defendant Beatrice Carson following the accident in question was properly presented during the trial. The investigating officer testified as follows:
“Q. [by plaintiff’s attorney]: Now as a result of your investigating the accident, was any citation issued?
"A. Yes, there was.
“Q. And who was the citation issued to, and for what reason?
“A. The citation was issued to Beatrice Carson for violation of the basic speed law.”
The above testimony was neither objected to nor stricken and must therefore be regarded as having been before the jury during its deliberation. It thus appears that plaintiff received all of the evidence to which she was entitled under the instant facts.
An extensive review of the record in the instant, admittedly close, case leads us to affirm the trial court for the reasons herein stated.
Affirmed. Costs to appellees.
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Levin, J.
The defendant, Bobert W. Kearns, was charged with contempt of court. After a hearing, the circuit judge found that Kearns was guilty of both criminal and civil contempt.
Kearns was sentenced on account of the criminal contempt to pay a fine of $250 or serve 30 days in jail, and, on account of the civil contempt, to serve 30 days in jail or until such time as the judge was satisfied that Kearns was no longer requiring payment of a $3 fee by members of the public who wished to examine certain records then under Kearns’ control.
The parties are in agreement that Kearns’ conviction of criminal contempt must be set aside because the proceedings were not conducted in conformity with the standards set forth in People v Johns, 384 Mich 325 (1971).
Kearns was found guilty of violating an order entered by the circuit court directing the Department of Buildings and Safety Engineering of the City of Detroit to provide reasonable facilities for the inspection and examination of its records by the general public. At the time the order was entered Kearns was serving as commissioner of the depart ment. He was still serving in that capacity when he was found guilty of civil and criminal contempt. Subsequently he was removed from his post. He is, thus, no longer in a position to comply with the circuit court’s order.
We recently observed in Spalter v Wayne Circuit Judge, 35 Mich App 156,161 (1971) :
“Since the purpose of civil contempt is to enforce compliance with a court’s order rather than to punish for disobedience, one convicted and sentenced for civil contempt may not be incarcerated beyond the time that he is able to comply with the court’s order.”
Accordingly, Kearns, who can no longer comply with the court’s order concerning the operation of the Department of Buildings and Safety Engineering, may not now be punished for civil contempt.
The City of Detroit asks that we go on to determine whether, in finding Kearns guilty of contempt, the judge correctly construed the order directing the department to provide reasonable facilities for the inspection and examination of its records by the general public. This we decline to do.
Kearns, not the city, filed this appeal. It is an appeal from a contempt conviction, not from a declaratory judgment. Kearns can no longer be punished for civil contempt; we set aside his conviction of criminal contempt on grounds that make it unnecessary for us to decide whether the judge correctly construed the order requiring that departmental records be made available to the public.
The city seeks a construction of the order so that the department may have guidance for the future. It would appear that the facts as they have developed since Kearns was convicted of contempt and since he was removed from office, as well as the factual context in which the order was entered, have a bearing on the correct resolution of the constructional issue. It would be inappropriate without a current record to attempt to declare how the order should be construed and to what extent, if at all, it inhibits the city from taking action it might otherwise wish to take.
Reversed.
All concurred.
Johns applies retroactively without regard to whether the issues decided in Johns were preserved at the trial or, indeed, at the appellate level. See People v Nowicki, 384 Mich 482 (1971), reversing 17 Mich App 525 (1969), | [
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McDonald, J.
The people appeal by leave granted from an April 29, 1991, interlocutory order granting defendant’s motion in limine regarding the admissibility of expert opinion testimony regarding the "battered spouse syndrome” (bss). We affirm in part, reverse in part, and remand for further proceedings consistent with this opinion.
The issue before this Court is one of first impression and involves the admissibility of expert testimony regarding the bss in situations where a self-defense claim is raised in a homicide trial. Defendant is charged with open murder, MCL 750.316; MSA 28.548, and possession of a firearm during the commission of a felony, MCL 750.227b; MSA 28.424(2), arising out of the shooting death of her husband. Defendant admits shooting the victim while he slept, but claims she acted in self-defense following forty-eight hours of abuse and death threats and years of battery.
Defendant asserts expert testimony regarding the bss is essential to her defense, and thus she filed a motion before trial to obtain an advance ruling regarding its admissibility. The people challenged the motion, denying the relevancy of the proposed testimony absent an offer of proof by defendant demonstrating that she was battered during her relationship with her husband and arguing defendant should be required to disclose the identity of the proposed witness. The people further suggested that the testimony, if found admissible, should be limited to a description by the expert of general behavioral patterns attributable to an individual suffering from the syndrome, and should not include expert testimony regarding the ultimate fact whether defendant suffers from the syndrome or whether the shooting resulted therefrom. The trial court entered an opinion and order finding expert testimony regarding the bss admissible under the following parameters:
[A]n expert qualified in the battered spouse syndrome may testify: (1) to a description of the general syndrome; (2) that the particular behavior of the spouse was characteristic of battered spouse syndrome victims generally; (3) whether the defendant suffers from the syndrome; (4) whether the defendant’s act was the result of the syndrome. The expert may not testify that the allegations of battering are in fact truthful or not. Issues of credibility are for the jury.
We agree with the people and find the trial court’s holding allowing expert testimony that defendant suffers from this syndrome and that defendant’s specific acts are attributable to this syndrome too broad and thus improper.
The decision to admit or deny expert testimony falls within the sound discretion of the trial court and will not be reversed absent a clear abuse of that discretion. People v Beckley, 434 Mich 691; 456 NW2d 391 (1990). Expert testimony may be received when it is "necessary” or "helpful” to the trier of fact in deciding an issue that is material. MRE 702; Beckley, supra.
Defendant argues expert testimony regarding the bss will help present her theory of self-defense. In People v Heflin, 434 Mich 482; 456 NW2d 10 (1990), our Supreme Court addressed the test for determining whether a person acts in self-defense. In Michigan, a homicide is justified under the theory of self-defense if the defendant "honestly and reasonably believes that his life is in imminent danger or that there is a threat of serious bodily harm.” Heflin at 502. A defendant who argues self-defense implies his actions were intentional but that the circumstances justified his actions. Heflin, supra. Thus, defendant argues the jury should consider the fact she suffered from the bss in evaluating her self-defense claim because it relates to the question whether she reasonably believed her life was in danger. Defendant also argues the evidence is relevant in rebutting the prosecution’s claim that she could have left her husband. One court has described the syndrome as follows:
The "battered woman syndrome” generally refers to common characteristics appearing in women who are physically and psychologically abused by their mates. The typical pattern of violence consists of three recurrent phases of abuse: a tension-building stage, characterized by minor abuse; an acute battering stage, characterized by uncontrollable explosions of brutal violence; and a loving respite stage, characterized by calm and loving behavior of the batterer, coupled with pleas for forgiveness. The continued cycle of violence and contrition results in the battered woman living in a state of learned helplessness. Because she is financially dependent on the batterer, she may feel partly responsible for the batterer’s violence, she may believe that her children need a father, or fear reprisal if she leaves. The battered woman lives with constant fear, coupled with a perceived inability to escape. Eventually, she comes to believe that her only options are enduring the abuse, striking back, or committing suicide. [Tourlakis v Morris, 738 F Supp 1128, 1134 (SD Ohio, 1990), citing Fennell v Goolsby, 630 F Supp 451, 456 (ED Pa, 1985).]
We do not believe the average juror is familiar with the complex behavior of a victim of the bss. Moreover, the majority of jurisdictions favor the admissibility of expert testimony regarding the bss. See, generally, anno: Admissibility of expert or opinion testimony on battered wife or battered woman syndrome, 18 ALR4th 1153 (1982); Tour lakis v Morris, supra. Testimony regarding the bss has been used in other jurisdictions to explain how a battered spouse reacts to the batterer, to explain the reasonableness of the battered spouse’s perception that danger or great bodily harm is imminent, and also to rebut the prosecution’s inference that the defendant could have left rather than kill the spouse. Tourlakis, supra, State v Hennum, 441 NW2d 793 (Minn, 1989), and Mather, The skeleton in the closet: the battered woman syndrome, selfdefense and expert testimony, 39 Mercer L R 545 (1988).
We conclude that in cases such as this one expert testimony regarding the bss will give the trier of fact a "better understanding of the evidence or assist in determining a fact in issue.” Beckley at 711.
Having determined the introduction of expert testimony regarding the bss generally may be relevant and helpful to the jury, we must now address the scope of its admissibility. As previously noted, we find the parameters outlined by the trial court to be too broad. We look to our Supreme Court’s decision in People v Beckley, supra, for guidance. In Beckley, the Court addressed the admissibility of expert testimony regarding the child sexual abuse accommodation syndrome. Given the nature of "syndrome” evidence, we find the reasoning contained in Beckley applicable to testimony regarding the bss.
In Beckley, the Court found expert testimony regarding the syndrome useful to the jury because it provided the jury information with which to dispel some of the common misconceptions regarding a child’s behavior following abuse. Given this rationale for the introduction of "syndrome” testimony, the Court limited the testimony to background information or discussion of the traits or symptoms experienced by victims of the syndrome. Because an expert regarding the child sexual abuse accommodation syndrome is an expert with regard to the syndrome and not the victim, it is inappropriate for that expert to render an opinion regarding whether the victim actually suffers from the syndrome. However, the Court in Beckley held the expert could render an opinion that the victim’s behavior is common to the class of child abuse victims as long as the symptoms are already established in evidence. The expert may not introduce new facts about the victim unless those facts are properly admitted under a rule other than MRE 702. Beckley at 726-727, 729.
We believe the same limitations should apply to experts who testify about the bss. As with the child abuse syndrome, the bss expert is an expert with regard to the syndrome and not the particular defendant. Thus, the expert is qualified only to render an opinion regarding the "syndrome” and the symptoms that manifest it, not whether the individual defendant suffers from the syndrome or acted pursuant to it.
We therefore affirm that portion of the trial court’s interlocutory order permitting the introduction of expert testimony regarding a description of the general syndrome and that certain behavior of the defendant already in evidence is characteristic of battered spouse victims generally, but reverse that portion of the order permitting testimony regarding whether the defendant suffers from the syndrome and whether the defendant’s act was the result of the syndrome. Further, as ordered by the trial court and consistent with Beckley, the expert may not testify that the allegations of battery are in fact truthful, this being an issue of credibility for the jury.
Affirmed in part, reversed in part, and remanded for further proceedings. We do not retain jurisdiction.
We do not address the requirement of MRE 702 that the expert testimony constitute evidence of a recognized scientific, technical, or other specialized discipline because the people concede this point by acknowledging the admissibility, in some form, of bss testimony. Moreover, in Beckley, supra, our Supreme Court recognized the existence of the syndrome and held as a general rule that behavioral sciences are not subject to the Davis-Frye test, People v Davis, 343 Mich 348; 72 NW2d 269 (1955); Frye v United States, 54 App DC 46; 293 F 1013 (1923). Likewise, we do not address the sufficiency of defendant’s proposed expert’s qualifications because the trial has yet to commence and the trial court has therefore not ruled with regard to this question.
In Beckley, supra, in permitting the introduction of expert testimony regarding the child sexual abuse accommodation syndrome, our Supreme Court recognized society’s adverse reaction to the typical behavior of victims of sexual assaults and found testimony by an expert helpful to explain the unfamiliar responses of children subjected to such abuse. | [
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Per Curiam.
The City of Auburn Hills appeals as of right from a November 20, 1989, judgment of the Oakland Circuit Court that held that the Oakland County Road Commission (ocrc) had validly relinquished jurisdiction over a portion of a county road, Lake Angelus Road, and that the portion of Lake Angelus Road within the City of Lake Angelus reverted to the City of Lake Angelus and the portion of the road within the City of Auburn Hills reverted to the City of Auburn Hills. We reverse the decision of the trial court, and return jurisdiction of the road to the ocrc.
On October 8, 1984, the ocrc passed a resolution, pursuant to MCL 224.18; MSA 9.118, relinquishing to the City of Auburn Hills jurisdiction over a portion of Lake Angelus Road ranging from Rohr Road to Giddings Road. This portion of the road was, in fact, a boundary road between the two cities, with the boundary being the center line of the road. The northerly half of the road is in Auburn Hills and the southerly half is in Lake Angelus. The ocrc attempted to relinquish jurisdiction over the road on November 1, 1984.
On December 21, 1988, the City of Lake Angelus filed a complaint for declaratory judgment, seeking a determination that MCL 224.18; MSA 9.118 did not authorize the ocrc to transfer jurisdiction of the road to Auburn Hills because a portion of the road was in Lake Angelus. Lake Angelus took the position that the relinquishment was entirely ineffective and jurisdiction over the road remained with the ocrc or, in the alternative, jurisdiction over the road was relinquished by the ocrc and the southern half of the road was transferred to Lake Angelus by operation of law.
On January 26, 1989, an order was entered permitting Auburn Hills to intervene as a defendant. Oral arguments on Lake Angelus’ motion for summary disposition were heard on April 19, 1989. On July 19, 1989, the trial court entered an order for partial summary disposition in favor of Lake Angelus, holding that the action taken by the ocrc on October 8, 1984, "was unauthorized by statute and beyond the legal authority of the Oakland County Road Commission to the extent that it purported to grant jurisdiction to the city of Auburn Hills over that part of Lake Angelus road between Baldwin and Rohr which is located within the city of Lake Angelus.” In denying the ocrc’s motion for reconsideration of the above order, the trial court noted that "none of the parties addressed what effect should be given to a county road commission resolution which in part exceeded the lawful powers of the road commission.”
Thereafter, the trial court and the parties agreed that the jurisdictional issue raised by the pleadings could be resolved by submission of briefs and oral argument. On November 8, 1989, the trial court heard the arguments of the parties. On November 20, 1989, the trial court entered its judgment in this matter, finding that the October 8, 1984, resolution of the ocrc "validly relinquished its jurisdiction over Lake Angelus road between Baldwin and Rohr effective as of November 1, 1984.” The court also held that, pursuant to MCL 224.18; MSA 9.118 and by operation of law, jurisdiction over the road was to be divided between Lake Angelus and Auburn Hills. It is from this ruling that Auburn Hills appeals as of right.
The City of Auburn Hills contends that the trial court erred in declaring that the ocrc validly relinquished jurisdiction over the road and that jurisdiction over the road was to be divided between the two cities. Auburn Hills argues that, because the resolution purported to relinquish jurisdiction over the road only to the City of Auburn Hills, the resolution was unauthorized by law and, therefore, the attempted relinquishment was invalid. We agree with this contention.
Declaratory relief is available to a party when necessary to guide its future conduct in order to preserve its legal rights. Menken v 31st District Court, 179 Mich App 379, 380; 445 NW2d 527 (1989). Our review is de novo on the record. Id.
In this case, the trial court interpreted the following pertinent portion of MCL 224.18; MSA 9.118:
The board of county road commissioners of any county which has adopted the county road system is hereby authorized and empowered to, at any time, either relinquish jurisdiction of or absolutely abandon and discontinue any county road, or any part thereof, by a resolution adopted by a majority vote. The vote of the county road commissioners in respect to either such relinquishment of jurisdiction or absolute abandonment and discontinuance shall be taken and entered, and notice thereof be given, in the same manner as required in this section, in cases in which county roads are adopted. After proceedings to relinquish jurisdiction have been had, the jurisdiction and control of such road, or part thereof, shall revert to the township or municipality within which the same is situated, and the county shall be relieved of the responsibility therefor. [Emphasis added.]
The duty of the courts is to interpret the statutes as found. Matheson v Secretary of State, 170 Mich App 216, 219; 428 NW2d 31 (1988). A plain and unambiguous statute is to be applied and not interpreted, because such a statute speaks for itself. Id. Courts may not speculate regarding the probable intent of the Legislature beyond the words employed in the act. Id. The use of the word "shall” in a statute indicates mandatory, rather than discretionary, action. Id.
We are of the opinion that the ocrc did not properly relinquish jurisdiction over Lake Angelus Road, and the October 8, 1984, resolution is null and void insofar as it pertains to this particular road. In attempting to relinquish jurisdiction over the entire width of the road to Auburn Hills, the ocrc’s resolution failed to comply with the mandates of MCL 224.18; MSA 9.118, which provides that after proceedings to relinquish jurisdiction have been had, the jurisdiction and control of the road, "or part thereof, shall revert to the township or. municipality within which the same is situated, and the county shall be relieved of the responsibility therefor.”
The ocrc’s resolution was, as noted by the trial court, unauthorized by statute and beyond the legal authority of the ocrc. The action of the ocrc was ineffective to relinquish and transfer jurisdiction of Lake Angelus Road, and the trial court could not correct the ocrc’s mistake by declaring a valid relinquishment and then dividing the subject road between the two cities.
This conclusion is supported by Village of Breedsville v Columbia Twp, 312 Mich 47; 19 NW2d 482 (1945), and Village of Bangor v Bangor Twp, 324 Mich 665; 37 NW2d 666 (1949). In Breedsville, the Michigan Supreme Court sought to determine the rights and obligations of the Village of Breedsville, the Township of Columbia, and the Van Burén County Board of Road Commissioners with regard to a bridge located within the corporate limits of the village. Id., pp 54-55.
The bridge was built in 1890 by the Township of Columbia, which maintained the bridge until 1927, when it was taken over by the Van Burén County Board of Road Commissioners. Id. Pursuant to a September 5, 1941, resolution, the board sought to "return” the bridge to the Village of Breedsville. Id. At the time in question, the predecessor to MCL 224.18; MSA 9.118 provided that after proceedings were held to discontinue and abandon a road, the jurisdiction and control of the road would revert to the township or municipality within which the road was situated, which, before the time of its adoption as a county road, had jurisdiction and control thereof. Breedsville, p 55. We would point out that the provision as it then existed also applied to a "relinquishment of control” by the board, as well as to the absolute abandonment and discontinuance of a road. Bangor, p 669.
The Michigan Supreme Court held that under the statute, the board could not return the highway to the village. Breedsville, p 55. The Court concluded that "the village of Breedsville has no authority to repair or rebuild the bridge.” Id. The board argued that the resolution adopted was sufficient in form and purpose to surrender its jurisdiction over that portion of the highway. Id., p 56. However, the Court stated that, in its opinion, the intent of the board to return the highway to the village and the failure to provide the Township of Columbia with notice of its intent to abandon or discontinue the road indicated a failure to comply with the statute. Id., pp 56-57. "The resolution did not accomplish the purpose now claimed for it.” Id., p 57. The Court concluded that the obligation of maintaining the bridge remained with the board. Id.
In Bangor, supra, the Van Burén County Board of Road Commissioners admitted that the proceedings used to relieve itself of various bridges, including the one at issue in Breedsville, "were not sufficient for the purpose intended.” Bangor, p 667. In Bangor, as in Breedsville, the record did not show that the "mandatory” requirements of the statute were met by the board and, therefore, the board still had sole responsibility for maintenance and control of the bridge. Bangor, p 669.
Similarly, in the case at bar, the ockc did not satisfy the mandatory requirements of the statute. The ocrc, pursuant to its resolution, sought to transfer jurisdiction over both halves of Lake Angelus Road to the City of Auburn Hills. The stat ute specifically provides that after proceedings to relinquish jurisdiction have been had* the jurisdiction and control of such road, "or part thereof, shall revert to the township or municipality within which the same is located . . . . ”
We believe that, consistent with Breedsville and Bangor, supra, the trial court was precluded from fashioning a proper resolution for the parties regarding the jurisdiction over the disputed portion of the road. We hold that the October 8, 1984, resolution of the ocrc was unauthorized by law and was ineffective to relinquish jurisdiction over the subject road. Additionally, we hold that the trial court did not have authority to correct the ocrc’s defective resolution.
We reverse the judgment of the trial court, return jurisdiction and control of Lake Angelus Road to the ocrc, and remand the case to the trial court for further proceedings consistent with this opinion. We do not retain jurisdiction. | [
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AFTER SECOND REMAND
Before: Shepherd, P.J., and Sawyer and Con-nor, JJ.
Connor, J.
Defendant appeals as of right from an amended judgment of divorce entered on August 9, 1989. We affirm in part and reverse in part.
This case has been before this Court on two previous occasions. The parties continue to dispute how to deal with plaintiffs military retirement pension. In Keen v Keen, 145 Mich App 824; 378 NW2d 612 (1985), we held that the pension was a marital asset susceptible to division. In Keen v Keen, 160 Mich App 314; 407 NW2d 643 (1987), we reversed the trial court’s award of alimony as a means of dividing the pension, and we ordered the trial court to ascertain the value of the pension and determine the appropriate amount and method of division. 160 Mich App 318.
On remand, the trial court determined the pension to be worth $218,767 and decided that distributing forty-five percent of the "net pension” to defendant would be equitable. The trial court also determined that weekly payments were an appro priate means of dividing and distributing the asset.
Defendant contends that the trial court did not follow the remand order precisely in determining how to value and divide the pension. We affirm the trial court’s determination of value. However, we note that the trial court’s use of the phrase "net pension” should be understood to mean "disposable retired pay” as defined by federal law. 10 USC 1408(a)(4). Only that portion of plaintiffs total retirement pay defined by statute as disposable retired pay is properly divisible. Mansell v Mansell, 490 US 581, 588-589; 109 S Ct 2023; 104 L Ed 2d 675 (1989). This Court also finds that the trial court did not err in ordering periodic payments. This method of distribution accords with the federal statute and will make it possible for defendant to receive her money directly from the federal government, 10 USC 1408(d). Moreover, federal law prohibits defendant from having any right to any portion of plaintiffs retired pay after her death, and retired pay stops when plaintiff dies, 10 USC 1408(c)(2), (d)(4). Because the applicable law has changed from the time of this Court’s second decision, the ruling by the trial court should not be viewed as inconsistent with this Court’s order for remand. See Barcheski v Bd of Ed of Grand Rapids Public Schools, 162 Mich App 388, 394; 412 NW2d 296 (1987).
Defendant also complains that the trial court erred in awarding her only forty-five percent of the disposable retired pay. This Court reviews dispositional rulings by a trial court de novo, but will not reverse the decision unless convinced that it would have reached a different result. Burkey v Burkey (On Rehearing), 189 Mich App 72, 78-79; 471 NW2d 631 (1991). The trial court’s findings of fact in reaching that decision are reviewed under the clearly erroneous standard. Beason v Beason, 435 Mich 791, 805; 460 NW2d 207 (1990); Burkey, supra. Distribution of marital assets should be fair and equitable in light of all the circumstances. Beckett v Beckett, 186 Mich App 151, 152-153; 463 NW2d 211 (1990). The trial court had already granted the bulk of the other marital assets to defendant while distributing to plaintiff the marital debts. At most, defendant could receive only fifty percent of the pension. 10 USC 1408(e)(1). Considering the property division as a whole, we find no error in the trial court’s decision. The property division was fair and equitable.
Defendant next argues that she should have been awarded interest on any arrearages. Considering the passage of time, we agree. Thomas v Thomas (On Remand), 176 Mich App 90, 92; 439 NW2d 270 (1989). However, we note that there may have been overpayments to defendant at times. Therefore, when arrearages are calculated, five percent simple interest should be added to all underpayments and deducted from all overpayments. Id., 93.
Defendant further contends that she should have been named beneficiary of plaintiffs survivor benefit plan. 10 USC 1448. However, if she were to be named beneficiary, plaintiffs disposable retired pay would be reduced, and consequently her share of that retirement pay would likewise be reduced. 10 USC 1408(a)(4)(D). Additionally, benefits under the plan may be lost if defendant remarries before reaching age fifty-five. 10 USC 1450(b). We find no error in the trial court’s decision.
Finally, defendant argues that the trial court should have granted her a life insurance policy on plaintiff to protect her interests in continued payments. Because we have found the property division to be fair and equitable, defendant is not entitled to any further property, including a life insurance policy. If she desires to insure against the risk that plaintiff may die prematurely, she can purchase the insurance herself.
We therefore affirm the judgment of the trial court, but remand for entry of an order clarifying that payments to defendant are to be based on forty-five percent of plaintiffs disposable retired pay and stating that when arrearages are calculated, five percent simple interest is to be charged on any underpayments and the same credited on any overpayments.
Affirmed in part and remanded for entry of an order clarifying the award and granting interest. We do not retain jurisdiction._
We note that 10 USC 1408(d)(3) provides that payments made directly from the federal government shall not be made more frequently than once a month, despite any court order to the contrary. The trial court determined that weekly payments were appropriate. Because we are again remanding this case to the trial court, its order should be clarified further to conform to 10 USC 1408(d)(3) by setting periodic payments on a monthly basis only, although the amount of the payments need only be expressed as a percentage of the disposable retired pay, 10 USC 1408(a)(2)(C).
There is disagreement among panels of this Court concerning whether the de novo standard of review for dispositional rulings survived the Supreme Court’s decision in Beason v Beason, 435 Mich 791; 460 NW2d 207 (1990). The panel in Moreen v Moreen, unpublished opinion per curiam, decided August 26, 1991 (Docket No. 122660), believed a de novo standard for dispositional rulings no longer exists, citing the reasoning in Judge Sawyer’s partial dissent in Burkey v Burkey (On Rehearing), 189 Mich App 72; 471 NW2d 631 (1991), but was required to follow the majority decision in Burkey under Administrative Order No. 1990-6, 436 Mich lxxxiv. Likewise, we are required by the administrative order to follow the majority’s decision in Burkey and apply a de novo standard of review with regard to the division of property. However, we need not express an opinion regarding this conflict under the facts of this case because our result would be the same under either standard.
We are aware that a previous panel addressed this issue on appeal. 145 Mich App 830-831. However, we have revisited this issue rather than apply the law-of-the-case doctrine because of the substantial changes that have occurred in the law while this case was pending. | [
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Fitzgerald, J.
These civil actions are consolidated before the Court on appeal as of right from judgments entered against defendant-appellant on April 26, 1971, in the Circuit Court for the County of Manistee after trial by the court without a jury on February 16, 1971. ■ Claim of appeal was filed on May 12,1971.
On April 23,1966, at about 11:20 a.m., the defendant-appellant, Michael Green, was driving an automobile owned by him at the intersection of US 31 and Merkey Road in Filer Township, Manistee County, Michigan. The plaintiffs were passengers in the car with him. The group belonged to the Jehovah’s Witnesses. At the time of the accident, they were going out into the community to teach those who were not affiliated with this organization to understand the Bible and attain personal salvation according to the Jehovah’s Witnesses’ biblical interpretations.
At said intersection, a collision occurred between defendant-appellant’s automobile and a car owned by defendant Jerome Nickelson and being driven by defendant Myra Irene Finley, as a result of which the plaintiffs were injured and these actions were instituted.
Plaintiff Sharon Lauer, a minor, by the guardian of her estate, Edwin Lauer, filed suit against defendant Michael Green as well as the owner and driver of the automobile with which defendant Michael Green collided. In a separate action, plaintiff Edwin Lauer sought damages from defendant Michael Green alone.
After a pretrial hearing, the court consolidated the two actions. Defendant Michael Green there after filed Ms motions for summary judgment in the two-captioned matters. These motions were denied.
On February 16, 1971, both matters were tried to the court without a jury. Defendant-appellant then moved for directed verdicts at the close of all of the proofs. These motions were also denied by the trial court. The court entered a judgment of no cause of action for defendants Finley and Nickelson, concluding that the former had not been negligent in operating the latter’s automobile. Judgment was entered against defendant-appellant and in favor of plaintiffs pursuant to a finding that plaintiffs and defendant-appellant were joint venturers and that the latter had been negligent in operating his vehicle.
On appeal, the sole issue before this Court is whether the lower court erred in finding that plaintiffs were engaged in a joint venture with defendant-appellant at the time of the accident in question so as to render the guest passenger statute, MCLA 257.401; MSA 9.2101, inapplicable.
The establishment of a joint venture or joint enterprise renders the guest passenger act inapplicable. MCLA 257.401; MSA 9.2101. Boyd v Mc-Keever, 384 Mich 501 (1971). Therefore, a proper test must be applied to the facts to determine whether the parties were engaged in a joint venture. The most recent test was enunciated in Boyd, supra, where the Court stated that the test of a joint venture as set forth in Emons v Shiraef, 359 Mich 526 (1960), places too much emphasis on the element of right of control. The Boyd Court established a three-pronged rule, p 508:
“To constitute a joint enterprise between a passenger and the driver of an automobile within the meamng of the law of negligence, there must be a community of interest in the use of the vehicle; there must be a finding of common responsibility for its negligent operation; and it must be found that the driver is acting as the agent of the other members of the enterprise.” (Emphasis supplied.)
The trial court did not apply this exact standard. In its opinion; citing Emons, supra, as authority, it established the following test:
“The case law merely states the following requirements :
“ (1) There must be a community of interest in the objective or the purpose of the undertaking.
“(2) An equal right to direct and govern the movements and the conduct of each other, and
“(3) Each must have some voice and right to be heard in its control or management.”
The first requirement in the trial court test, community of interest, agrees with the test set down in Boyd, supra. In the instant case, all parties in the defendant-appellant’s car were serving the church. They were evangelizing and preaching the word of Jehovah. The trial court correctly determined that there was a community of interest in the objective or purpose of the undertaking.
The second requirement set out by the trial court, an equal right to direct and govern the movements and the conduct of each other, meets the third criterion set out by Boyd regarding the status of the driver as the agent of the other members of the enterprise. The Supreme Court could not have intended that the strict law of agency be applied to joint enterprise because if the driver was agent for the other passengers, then the law, which states that the principal is liable for the acts of the agent, would act as a bar to any action brought on the grounds of joint enterprise, because the passengers, principals, would always be responsible for tbe acts of the driver. This Court adopts a more reasonable interpretation. The driver must be an agent for the others in that he adopts the behavior the group decides upon. The group decides the movements and conduct of all of the persons in the automobile. The driver then follows the directions dictated by the group decision. That is the exact situation in the instant case. Defendant-appellant followed the decisions made by the group. The trial court correctly found this element to be present.
Seemingly, the third criterion set by the trial court was incorrect because the Supreme Court, in Boyd, p 508, specifically states that too much emphasis has heretofore been placed on control. The Supreme Court apparently replaces this test with “a finding of common responsibility for its negligent operation”. The Court does not elaborate on the meaning of that language, but the Court in Emons, supra, p 531, quoted approvingly the following statements in Farthing v. Hepinstall, 243 Mich 380, 382 (1928):
“To constitute a joint enterprise between a passenger and the driver of an automobile within the meaning of the law of negligence, there must be such a community of interest in its operation as to give each an equal right of control. There must be a common responsibility for its negligent operation, and there can be no common responsibility unless there is a common right of control.” (Emphasis supplied.)
Furthermore, a literal translation of the second requirement of the Boyd test, in light of the language in Emons, would imply contributory negligence as a prerequisite to a finding of joint enterprise. This interpretation would preclude recovery in any joint enterprise situation. This could not have been the intent of the Supreme Court.
This Court finds that the trial court substantially-complied with the second criterion of the Boyd test. This requirement was satisfied in that all the parties in the car mutually decided the course of action taken by the driver. Peer group pressure alone provided sufficient control over the driver to constitute common right of control. Furthermore, a joint decision was made as to where the field ministry work was to be done and the mode of transportation to be used to reach the agreed-upon destination. The automobile was merely the tool for carrying out the prearranged plans. Each member in the auto did in fact share in the control of this tool.
The three criteria set forth in Boyd were met under the test utilized by the trial judge in the case at hand. Therefore, plaintiffs were engaged in a joint venture with defendant-appellant at the time of the accident in question so as to render the guest passenger statute inapplicable.
Affirmed with costs to the plaintiffs-appellees.
All concurred. | [
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Memorandum Opinion.
Defendant was tried and found guilty by a jury of armed robbery, MCLA 750.529; MSA 28.797, was sentenced to 7-1/2 to 15 years in prison and now appeals.
An examination of the record and briefs discloses no prejudicial error.
Affirmed. | [
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Memorandum Opinion.
Defendant was convicted on plea of guilty of assault with intent to rob while armed, and appeals. The people have filed a motion to affirm.
Upon examination of the brief and record, it is manifest that the question sought to be reviewed is so unsubstantial as to need no argument or formal submission.
Motion to affirm granted. | [
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Shepherd, J.
Plaintiff appeals by leave granted from an order of the Washtenaw Circuit Court affirming an order of the 15th District Court that granted summary disposition for defendants West-field Insurance Company and Mundus and Mundus, Inc., and dismissed the claims against them. Plaintiff claimed a theft loss under a homeowner’s insurance policy issued by Westfield; Mundus was the insurance agent that sold plaintiff the policy, and plaintiff claimed that an employee of Mundus induced him to replace the missing items before the claim had in fact been approved, resulting in loss to him. Plaintiff also claimed that defendant Richard Colon took the items in question. Plaintiff and Colon reached a settlement on the record, and, although no order dismissing the case against Colon was entered, he is no longer involved in this matter.
Westfield denied the claim on the ground that no theft occurred within the meaning of the policy. Plaintiff filed suit in district court, alleging breach of contract against Westfield and equitable estoppel against defendant Mundus.
Plaintiff hired Colon to work on drywall and stucco in plaintiff’s home. Plaintiff was dissatisfied with the job, and on August 11, 1987, his wife told Colon that plaintiff expected him to finish the job and they would discuss payment. Plaintiff’s wife left the home to get plaintiff. Plaintiff said that Colon agreed to finish the job while they were gone; Colon claimed that he already had finished the job and was waiting for payment and plaintiff left him waiting for several hours.
When plaintiff arrived home, Colon was gone, and plaintiff discovered that twenty-five items, primarily tools and hardware of various kinds, were missing. Plaintiff reported the incident to the police and, on the next day, called his insurance agent, Mundus. Plaintiff purchased his homeowner’s insurance policy from Westfield through Mundus. Plaintiff claimed that, in a telephone conversation, an employee of Mundus told him that the loss was covered and, because he had replacement value coverage, he should buy new items and submit the receipts for reimbursement. Plaintiff did so and submitted a claim totaling $3,790.
Several days later, Colon confronted plaintiff and told him he had taken the property. Plaintiff said that he asked Colon to turn the property over to the police, but Colon did not do so. The police, apparently, did not pursue the matter.
Some time later, Westfield denied plaintiff’s claim on the ground that there was no "theft” within the meaning of the policy. Plaintiff sued Westfield, Mundus, and Colon. Colon answered the complaint by letter, in which he claimed that he had finished the job plaintiff hired him to do and had asked plaintiff’s wife for payment. He said that plaintiff’s wife stated that she had to go get plaintiff and left. Colon said he waited at plaintiff’s home for over five hours. When plaintiff did not return with payment, he was "forced to take” collateral. He also said that he left a note on plaintiff’s door stating that he had taken seven specified items that he would return upon payment for his work. Colon said that he left messages on plaintiff’s answering machine and went to his home a few days later. Plaintiff persisted in refusing to pay, so Colon refused to return the tools.
After announcing a bench ruling regarding the motion for summary disposition, the district court was about to proceed to trial of plaintiff’s claim against Colon. After a recess, the parties informed the court that they had reached an agreement, and they placed a settlement agreement on the record. Colon agreed to return the seven items he had listed in his letter, and plaintiff agreed to pay him $366. The agreement was incorporated into an order entered on February 3, 1989. Neither the settlement nor the order includes any recitation of facts concerning the circumstances under which Colon took the property.
The district court granted defendants’ motion for summary disposition following oral argument on January 26, 1989. The court entered an order on May 9, 1989, and plaintiff appealed to the circuit court. The parties waived oral argument, and the circuit court affirmed the district court order on April 23, 1990.
Plaintiff claims that the circuit court erred in affirming the district court’s grant of summary disposition and that both lower courts erred in applying a technical, legal definition to the term "theft” in a homeowner’s insurance policy. We hold that the term "theft” in the insurance policy includes the element of felonious intent.
The insurance policy in this case insured against theft of unscheduled personal property under the following provision:
10. Theft, meaning any act of stealing or attempt thereat, including loss of property from a known place under circumstances when a probability of theft exists.
a. General Theft Exclusions:
This policy does not apply to loss:
(1) if committed by an Insured;
(2) in or to a dwelling under construction or of materials or supplies therefor until completed and occupied;
(3) arising out of or resulting from the theft of any credit card or loss by forgery or alterations of any check, draft, promissory note, bill of exchange, or similar written promise, order or direction to pay a sum certain in money; or
(4) of a precious or semi-precious stone from its setting.
Defendant Westfield refused plaintiff’s claim on the ground that the occurrence here was not a theft within the meaning of the policy because Colon did not intend to deprive plaintiff of the property permanently. Westfield contends, and both lower courts agreed, that the terms "theft” and "stealing” invoke definitions from the criminal law, and that larceny and related "theft” crimes require a specific intent to deprive the owner of the property permanently.
Defendant Westfield cites Daugherty v Thomas, 174 Mich 371, 378; 140 NW 615 (1913), for a definition of "steal” that includes felonious intent. In Daugherty, the Court considered the validity of the then recently enacted owner’s liability statute with respect to motor vehicle accidents. The statute provided that the owner of a vehicle was liable for an injury caused by the negligent operation of the vehicle by any person. 1909 PA 318, § 10(3). The statute allowed the following exception: "but such owner shall not be so liable in case such motor vehicle shall have been stolen.” Id. In Daugherty, a repairman with whom the owner left the car for repairs struck and injured the plaintiff while driving the car without the owner’s knowledge or consent. The question was whether that situation was within the statutory exception. The Court held that it was not:
The word "stolen” can have but one meaning when used in connection with personal property, as in this case. To steal is to commit larceny. The word "steal” has a uniform signification when used in connection with personal property, and in common, as well as in legal parlance means, the felonious taking and carrying away of the personal goods of another. [Daugherty, 174 Mich 378.]
This passage from Daugherty strongly supports Westfield’s position. The reference to common usage of the term may have been dicta, but the Court unequivocally considered the word "steal” to include the felonious intent element of larceny.
A similar issue was apparently raised by the defendant in Wetzel v Cadillac Mutual Ins Co, 17 Mich App 57; 169 NW2d 128 (1969). This Court, however, decided the case on other grounds and did not address the question whether the person who took the plaintiffs car had the intent permanently to deprive the owner of the property within the meaning of the theft provision of an automobile insurance policy. In that opinion, however, the Court implied, but did not hold, that theft within the meaning of the insurance policy included the elements of common-law larceny. Id., p 60.
The position of a majority of the other jurisdic tions, and one adopted by authors of major treatises, agree with Westfield that in order to constitute loss by theft under an insurance policy, there must be a wrongful taking and asportation with intent to deprive the owner of property permanently. Home Fire & Marine Ins Co v E V McCollum & Co, 201 Okla 595; 207 P2d 1094 (1949); Penn-Air, Inc v Indemnity Ins Co, 439 Pa 511, 518-519; 269 A2d 19 (1970); VanVechten v American Eagle Fire Ins Co, 239 NY 303, 305; 146 NE 432 (1925); Hayes v Financial Indemnity Co, 118 Cal App 2d 883, 894; 257 P2d 765 (1953) (see pp 886-894 for summaries of cases holding the majority and the minority views); 10A Couch, Cyclopedia of Insurance Law (2d ed), § 42:116, pp 250-251; anno: What constitutes theft within automobile theft insurance policy — modern cases, 67 ALR4th 82. One treatise notes that even where the courts have extended the meaning of "theft” beyond common-law larceny to include embezzlement, swindling, or the like, the common requirement is that there be intent to deprive the owner of the property permanently. 5 Appleman, Insurance Law & Practice, § 3171, pp 490-491.
Accordingly, we hold that the trial court correctly granted summary disposition in favor of Westfield.
With respect to Mundus, count n of plaintiffs complaint reads as follows:
16. At all times herein, Defendant, Mundus and Mundus, Inc., held themselves out as agents for Defendant Westfield Insurance Company.
17. On or about August 12, 1987, upon filing a Proof of Loss with Defendant, Mundus and Mundus Inc., Plaintiff was advised by an employee of Defendant Mundus and Mundus Inc., to replace the stolen items.
18. In reliance upon Defendant, Mundus and Mundus Inc.’s representations, Plaintiff replaced many of the stolen items at his own expense.
19. Defendant, Westfield Insurance Company, has refused to reimburse Plaintiff for money spent.
20. As a proximate result of Defendant Mundus and Mundus Inc.’s representations, Plaintiff has sustained damages in the amount of Four Thousand ($4,000.00) Dollars.
The district court granted summary disposition for Westfield and Mundus with respect to this count, stating:
Defendant’s [Westfield] Motion for Summary Disposition is granted. As to the Defendant Mundus and Mundus, the law is clear that an insurance agent is not responsible for the payment of a loss under an insurance policy, and nothing that they did could be construed as estoppel.
The circuit court affirmed on similar reasoning.
On appeal, plaintiff argues that "the doctrine of estoppel” entitles him to relief for Mundus’ representation that "the theft was covered by [plaintiff’s] homeowner’s insurance policy, [and] that he should replace the stolen items and submit his receipts for full reimbursement.” Plaintiff continues:
Plaintiff relied on these representations and replaced many of. the stolen items at his own expense. The insurance agent was in a position of authority with regard to Plaintiff’s insurance coverage. Plaintiff was entitled to rely on the agent’s representations. It would be inequitable after the fact for Defendant [Westfield Insurance Company?] to be permitted to deny coverage for those items already replaced.
In his opinion, Judge Alexander stated that nothing that the insurance agent did could be construed as estoppel. . . . This is a finding of fact which is disputed. Defendants argue that the agent only explained a claims procedure. . . . Plaintiff has alleged in his complaint that an employee of the agent told Plaintiff to replace the stolen items and that Plaintiff relied on this representation and replaced many of the stolen items. [Emphasis added.]
Thus, plaintiff argues, to the extent the trial court granted summary disposition pursuant to MCR 2.116(0(10), it erred.
Plaintiff also argues:
Plaintiff[’]s complaint sets forth sufficient allegations to support plaintiff[’]s claim for damages against Westfield Insurance Company for breach of contract and against Defendants Mundus & Mundus and Westfield Insurance Company for detrimental reliance or equitable estoppel.
We agree that plaintiff failed to state a claim upon which relief can be granted, MCR 2.116(C)(8) —or at least has failed to explain how the facts that were pleaded support a cognizable claim. We affirm the trial court’s grant of summary disposition, albeit for different reasons. However, we remand to give plaintiff an opportunity to amend his pleadings. MCR 2.116(C)(8), 7.216(A)(7).
Plaintiff’s argument that he has stated a claim against defendant insurance agent is premised on the assumption that equitable estoppel constitutes a cause of action. Although there may be occasional aberrant opinions, the general rule is that equitable estoppel is a doctrine, not a cause of action. A distinction must be made between promissory estoppel and equitable estoppel. Plaintiff asserts that the doctrine of equitable estoppel is applicable here. The elements of promissory estoppel are set forth in Parkhurst Homes, Inc v Mc Laughlin, 187 Mich App 357, 360-361; 466 NW2d 404 (1991):
(1) a promise, (2) that the promisor reasonably should have expected to induce action of a definite and substantial character on the part of the promisee, (3) which in fact produced reliance or forbearance of that nature, and (4) in circumstances requiring that the promise be enforced if injustice is to be avoided.
Equitable estoppel arises where
a party, by representations, admissions, or silence, intentionally or negligently induces another party to believe facts, the other party justifiably relies and acts on this belief, and will be prejudiced if the first party is permitted to deny the existence of those facts. [Southeastern Oakland Co Incinerator Authority v Dep’t of Natural Resources, 176 Mich App 434, 442-443; 440 NW2d 649 (1989).]
It has been held that "the major distinction between equitable estoppel and promissory estoppel is that equitable estoppel is available only as a defense, while promissory estoppel can be used as a cause of action for damages.” Tiffany Inc v WMK Transit Mix, Inc, 16 Ariz App 415, 419; 493 P2d 1220 (1972).
Thus, a panel of this Court has said:
[W]e would further note that equitable estoppel or estoppel in pais is available as protection from a defense raised by the defendant. It is not available to the plaintiff in stating a cause of action. Dickerson v Colgrove, 100 US 578; 25 L Ed 618 (1880). [Harrison Twp v Calisi, 121 Mich App 777, 787; 329 NW2d 488 (1982).]
Notwithstanding the dicta in Calisi, our Courts have apparently allowed plaintiffs to avail themselves of the doctrine. See 1 Michigan Pleading & Practice, § 8.33, p 426 ("if rights relied upon are based upon estoppel of the opposite party to assert them, they must be set up in the complaint to show the estoppel”). See also Cuddihy v Wayne State University Bd of Governors, 163 Mich App 153, 156-157; 413 NW2d 692 (1987) (distinguishing promissory from equitable estoppel, and concluding that plaintiffs complaint sounded in the latter, but not stating that former does not constitute a cause of action). Indeed, one panel has held that it was error for the trial court not to instruct the jury with regard to an equitable "estoppel cause of action.” AAMCO Automatic Transmissions, Inc v Motor Trans, Inc, 45 Mich App 539, 545-546; 207 NW2d 156 (1973).
In our view, Prosser’s discussion of equitable estoppel in connection with misrepresentation is correct:
For obvious reasons, it appears most frequently as a defense to an action brought by the party to be estopped; but, while it never has been recognized as a cause of action in itself, it may serve as an important, or even the sole, aid to the plaintiff. Thus a warehouseman, who represents that he holds goods for another in response to an inquiry by an intending purchaser from that other, or one who informs such a purchaser that his signature forged to a negotiable instrument is genuine, may be estopped to deny the truth of his statement if the purchase is made in reliance upon it; or a corporation which fails to require surrender of an old stock certificate when a new one is issued may find itself estopped as against a holder for value of the old certificate. In such cases the plaintiff prevails, not on the theory that the defendant’s mis representation is tortious in itself, but because the defendant is not allowed to assert the truth, which would otherwise be a defense to some other action. Estoppel, of course, is not confined to tort cases, and runs throughout the entire field of law. [Prosser, Torts (4th ed), § 105, pp 691-692. Emphasis added.]
In summary, equitable estoppel is a doctrine that might assist plaintiff; it is not a cause of action and therefore provides no remedy such as damages. In this case, it appears that plaintiffs attempt to set forth a claim against the insurance agency on the basis of the alleged (mis)representation of its employee could fall into one of the following categories (other than the nonexistent claim of equitable estoppel): fraud or negligence. A careful reading of count n of plaintiffs complaint leads one to conclude that this was the thrust of plaintiffs claim although the count is inartfully stated.
We remand to the district court in order to give plaintiff an opportunity to plead a claim of fraud or to state properly a claim of negligence against defendant Mundus only.
We affirm with regard to defendant Westfield Insurance Company. We do not retain jurisdiction.
Affirmed in part and remanded.
Plaintiffs pleadings do not clearly allege a claim against Westfield arising out of the misrepresentations of Mundus. To the extent that Mundus made false representations to plaintiff, Mundus was acting outside the scope of its agency. There was a precise method for filing claims, which method did not include replacing the items before Westfield had approved the claim. There is nothing before us to justify any claim that the alleged misrepresentations amounted to anything other than negligence or fraud on the part of the insurance agency acting without the authority of Westfield. We make no comment regarding the truth of plaintiffs claim against Mundus or his ability to prove any damages. | [
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Per Curiam.
Defendant was convicted by a jury in Detroit Recorder’s Court of carrying a concealed weapon on his person. MCLA 750.227; MSA 28.424. He was sentenced to a term of three to five years. Defendant appeals of right.
The testimony at trial revealed that on May 6, 1970, Detroit Police Officers Dennis Shiemke and Wayne Marien were patrolling a high-crime area in Detroit. Officer Shiemke observed a man walking six feet behind a man and woman in an alley. When this man noticed the officers, he reached into his coat and pitched something behind a garbage can. He then ran to the back door of a nearby apartment building. The officers drove into the alley where Officer Shiemke observed a handgun laying near the garbage can while Marien proceeded to the front of the building. Shiemke yelled to Marien, “It’s a gun”, and the latter arrested the defendant as he came out of the apartment’s front door. There was also testimony that on May 6, 1970, defendant did not have á license to carry a gun. At the close of the people’s proofs, defendant moved to dismiss the charge. The motion was denied.
The only issue on appeal is whether the trial judge erred in denying the motion to dismiss. Defendant argues that the evidence submitted does not support a conviction of carrying a concealed weapon. He contends that the only evidence produced was that he was seen to pitch some unknown thing and that there was no evidence of concealment.
On investigating a suspicious situation and in pursuit of a suspected felon, Officer Shiemke found a gun behind the garbage can in which the suspect was seen to have thrown something. The search, seizure, and introduction of the gun into evidence was proper. Warden, Maryland Penitentiary v Hayden, 387 US 294; 87 S Ct 1642; 18 L Ed 2d 782 (1967). This is sufficient to permit the jury to find the gun was in defendant’s possession and that he threw it. A criminal jury may draw reasonable inferences from facts established either by direct or circumstantial evidence. People v Grabowski, 12 Mich App 672 (1968); People v Iron, 26 Mich App 235 (1970).
Concealment is an essential element of the crime of carrying concealed weapons. People v. Pickett, 21 Mich App 246 (1970). A weapon is concealed if it is hidden from the ordinary observation of persons in the ordinary and usual associations of life. People v Johnnie W Jones, 12 Mich App 293 (1968). The issue of concealment depends on the particular circumstances present in each case. The question of whether the gun was concealed is for the trier of fact. People v Jones, supra. In this case, there was a question of fact as to whether the gun was concealed. It was for the jury to decide. People v Iacopelli, 30 Mich App 105 (1971).
Affirmed. | [
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Memorandum Opinion.
Defendant pleaded guilty to second-degree murder. MCLA 750.317; MSA 28.549. He was sentenced to a term of 14 to 15 years in prison and appeals.
An examination of the record and briefs discloses no prejudicial error.
Affirmed. | [
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O’Hara, J.
The Commissioner of the Financial Institutions Bureau of Michigan’s Department of Commerce determined, after a hearing held January 8, 1970, that plaintiff was violating § 171 of the Banking Code of 1969 (MCLA 487.471; MSA 23.710 [171]).
This act prohibits the establishment of a branch bank in a city or village in which a state or national bank or branch thereof is then in operation. The commissioner determined that the plaintiff was oper ating a branch, bank in the city of Southgate, Michigan, where the Security Bank & Trust Company also has its main office and two branches. The commissioner ordered the plaintiff to cease and desist its operation of a branch bank in Southgate, acting pursuant to his authority under § 35 of the Banking Code of 1969 (MCLA 487.335; MSA 23.710 [35]). The court below affirmed the findings of the commissioner and this appeal followed. The cease and desist order has been stayed pending our decision.
The only issue raised on appeal asks whether or not the activities practiced by the plaintiff constitutes prohibited branch banking.
Section 5(d) of the Banking Code of 1969 (MCLA 487.305[d]; MSA 23.710[5] [d]) defines a branch bank as follows:
“ ‘Branch’ means any branch bank, branch office, branch agency, additional office or any branch place of business at which deposits are received or checks paid ormoney lent.”
In interpreting this definition, we take guidance from the United States Supreme Court which recently had an occasion to interpret an identically worded definition of a branch bank contained in 12 USC 36(f). The result reached in First National Bank v Dickinson, 396 US 122; 90 S Ct 337; 24 L Ed 2d 312 (1969), is relevant to the case at bar. A comparison between the factual situations in the two cases makes this readily apparent.
In Dickimon, a national bank sought to maintain an armored car service and an off-premises receptacle service for the receipt of its customer’s cash and check deposits. The armored^ car picked up such deposits at the places of business of the bank’s customers. The stationary, vault-like receptacle was located in a shopping center, and the bank’s customers could take tbeir cash or checks to this location to make deposits, including night deposits by customers having a key. The customers received a transmittal slip for their deposits which in effect was a contract stating that a deposit was not deemed made until the cash or checks were delivered to the bank. Thus, theoretically, both the armored car service and shopping center service were agents of the customer rather than of the bank, liable to the customer until the cash or checks were actually delivered. In reality, however, the bank assumed the risk of the loss of the deposit while in transit by purchasing appropriate insurance. Furthermore, both the armored car and the shopping center receptacle were operated by and at the direction of employees of the bank.
The United States Supreme Court held that these activities constituted branch banking as defined by the Federal act. The court was not persuaded that the private contract between the bank and its customers — to the effect that no deposits were made until the monies were actually received at the bank— in any way changed the basic character of the branch banking activities practiced:
■ “But while the contracting parties are free to arrange their private rights and liabilities as they see fit, it does not follow that private contractual arrangements, binding on the parties under state law, determine the meaning of the language or the reach of § 36(f).
“Because the purpose of the statute is to maintain competitive equality, it is relevant in construing ‘branch’ to consider, not merely the contractual rights and liabilities created by the transaction, but all those aspects of the transaction that might give the bank an advantage in its competition for customers. Unquestionably, a competitive advantage accrues to a bank that provides the service of re ceiving money for deposit at a place away from its main office; the convenience to the customer is unrelated to whether the relationship of debtor and creditor is established at the moment of receipt or somewhat later.” 396 US at pp 136-137; 90 S Ct at pp 34A-345; 24 L Ed 2d at pp 321-322.
Striking parallels exist in the present case. Plaintiff moved out of its Southgate office when granted permission to open a bank in Warren but its ties with its Southgate customers were never completely severed. Plaintiff bank continued to maintain a lease on the Southgate premises. The physical features of this office were kept the same except for the removal of the bank’s name. Teller windows and a vault were maintained on the premises. Tellers and a manager remained at the Southgate office. All were paid by the plaintiff. The bank covered them under a surety bond and deducted their withholding for income tax purposes.
Working through Tri-City Services, Inc., with whom the plaintiff appears to have a contract, the employees at the Southgate office not only received cash and cheek deposits for savings and checking accounts with the plaintiff, but cashed checks, paid withdrawals, and handled various aspects of loan transactions for the plaintiff. While Tri-City Services, Inc., was titularly and contractually responsible for such activities until cleared by the plaintiff, in fact the plaintiff paid for the insurance necessary to protect both itself and its Southgate cusr tomers throughout these transactions. It further appears that some of the money received in deposit at the Southgate office was never transferred to the plaintiff, but was used at the discretion of the South-gate employees for the payment of checks and withdrawals and for the making of change for the South-gate customers.
The Attorney General, on behalf of the commissioner, argued that Tri-City Services, Inc., and TriCity Bank of Warren, though two different corporations, were in fact the same entity and that in such circumstances courts should not hesitate to “pierce the corporate veil.”
Under the facts of this case, if a corporate veil was created it was. so flimsy as to amount almost to bi-corporate indecent exposure.
We are in complete accord with the succinct findings and conclusions of the learned trial judge:
“The operations of * * * Tri-City Services, Inc., was in fact that of the Tri-City Bank and * * * the various instrumentalities used by the Tri-City Services, Inc., to avoid the appearance of a banking corporation are mere subterfuges * * * . The conclusion from the record is clear. Plaintiff bank was engaged in the illegal operation of a branch bank.”
We agree.
The stay order heretofore issued is dissolved.
The order of the Commissioner of Financial Institutions is affirmed. Costs to the appellee.
All concurred. | [
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North, J.
The Congregation Shaarey Zedek, an incorporated body affiliated with the United Synagogue of America, petitioned the common 'council of the city of Detroit to vacate the east 111 feet of an alley which extends through the block bounded on the east by Lawton avenue; on the west by Wildemere avenue; on the north by Rochester avenue, and on the south by Chicago boulevard. This alley is 18 feet in width, runs parallel with Rochester avenue, and is distant approximately 107 feet therefrom.
The Congregation owns all the property abutting on that portion of the alley sought to be vacated. Each of the plaintiffs herein owns a large multiple apartment building located on lots in said block abutting on this alley west of the portion sought to be vacated. They filed a bill in the circuit court of Wayne county, by which they sought to have the defendants restrained from vacating the portion of said alley above described.
The petitioner desires the proposed changes to enable it to- construct a community building and temple extending across the easterly end of this block, and costing upwards of half a million dollars. In lieu of the portion of this alley sought to be vacated the Congregation proposes to dedicate from its property a parcel of land for alley purposes 20 feet in width, and extending to Rochester avenue,.from a point 30 to 40 feet west of the easterly end of the alley as changed. The result would be an “L” shaped alley instead of one extending on a straight line through the block. To provide adequate turning space at the corner in this alley the Congregation also offers to dedicate additional land sufficient to accommodate fire trucks and other large vehicles. The short portion of the existing alley which would extend east of the corner is to be increased in width from 18 feet to 30 feet, thus affording space in which to turn around with ordinary vehicles in the cul-de-sac portion'of the proposed alley. All these changes have been submitted to the city plan commission of Detroit, and after hearing the respective parties this commission reported to the common council
“That proper alley circulation will be provided in the block with the opening of a new alley, and that no person in said block will be injured by the change in the alley. * * * The city plan commission therefore recommends that the petition be granted."
The officials of the fire commission objected to the proposed changes in this alley on the ground that the fire hazard would be increased.
■ Hearings were had before the common council, and the plaintiffs and others opposed granting the petition of the Congregation, claiming the proposed changes would interfere with fire protection for their buildings, some of which are four-story apartments, being only semi-fire proof, and occupied by many families, the safety of whom, it was claimed, would be jeopardized. It was also urged by those opposing the petition, that the proposed action in vacating or changing this alley would deprive them of property without due process of law. The common council, acting as a committee of the whole, voted to vacate the portion of this alley as prayed by the petitioner; but before further or final action was taken, this bill was filed and a temporary injunction issued. After the hearing on the merits, the temporary injunction was dissolved and the bill of complaint dismissed. The plaintiffs have appealed.
The record presented here discloses that there is no ground for contending that the common council of Detroit, in its proposed action, was or is prompted by fraud or any dishonest motive, or that it has failed to give a hearing and due consideration to all parties concerned. Evidently the common council, when acting as a committee of the wjiole, decided that no serious increase of fire hazards would result from the- proposed change, and that the public welfare would be served thereby, since it would enable the Congregation Shaarey Zedek to erect a community building and temple. The power to determine this question is clearly vested in the common council, and, having acted without fraud or abuse of discretion, its decision cannot be reviewed by this court. Phelps v. Stott Realty Co., 233 Mich. 486, 492.
Three other questions are presented in this case, as follows:
(1) Has the common council of Detroit, under its present charter, the power to vacate alleys?
(2) If it has this power, will these plaintiffs be deprived of property without due process of law by the proposed action of the common council?
(3) Is the provision of the Constitution of Michigan which vests the reasonable control of their streets and alleys in cities, villages, and townships (art. 8, § 28) or the somewhat similar provision of the Detroit city charter, in violation of the Federal Constitution?
1. It is strenuously urged in behalf of the plaintiffs that the power to vacate streets and alleys in Detroit is not now possessed by the common council because the present city charter adopted in 1918 (title 3, chap. 1, § 12 g), vests in the common council only the power “to provide for the management and control of all property including streets and alleys;” whereas the former charter (1904) expressly vested the common council with power to “alter, vacate, and abolish” alleys. Plaintiffs’ contention is that by necessary implication this amounts to a withdrawal of the power to alter, vacate, and abolish alleys. We are not in accord with this contention. The mere changing of the verbiage of the charter is of no consequence if the power thereby vested is equally broad.
In placing a construction upon the present charter, we must be mindful of the provision of the State Constitution of 1908 that “the right of all cities, villages, and townships to the reasonable control of their streets, alleys, and public places is hereby reserved to such cities, villages, and townships.” Art. 8, § 28. It is a fair and reasonable inference that in drafting the city charter of 1918 there was an attempt to follow more closely the wording of the Constitution of 1908, rather than an intent to deprive the city of this power of local self-government incident to its streets and alleys. This inference is especially potent since, so far as we can ascertain from this record, no specific provision was made in the new charter for vesting this important power in any other body. This construction is also justified by the fact that the preamble to the present city charter recites that said charter was adopted in order that the people of Detroit might “secure the fullest measure of self-government conferred by the Constitution and laws of the State of Michigan.” In arriving at the foregoing conclusion, we have not overlooked plaintiffs’ contention that, by ■the Detroit charter, the power to control its alleys, including the power to control vacating the same, is vested in the fire commission. Vacating streets and alleys can hardly be said to be germane to the duties of a fire department or a fire commission; and we find the Detroit charter is not subject to such a construction ; but, on the contrary, we find this power is vested in the common council by the city charter, which provides that the common council shall have -power-“to providé for the management and control of all' property, including streets, alleys, and other public places.” Title 3, chap. 1, § 12g.
2. The second question for determination here is whether changing this alley in the manner proposed will deprive plaintiffs of property, without due process of law. This question has been adjudicated against the contention of the plaintiffs so recently in this State that it is unnecessary to discuss it here, and a reference to some of the decisions and the authorities there cited is deemed sufficient. Tomazewski v. Palmer Bee Co., 223 Mich. 565; Phelps v. Stott Realty Co., 233 Mich. 486.
From a review of the above and other authorities the controlling element seems to be. this: If the vacating or changing is of such a character that it deprives any abutting owner of a substantial right appurtenant to his property, resort must be had to due process of law incident to the exercise of eminent domain; but if it clearly appears that the proposed change in vacating a portion of an alley is to be brought about in such a manner that it does not deprive an owner of any substantial right appurtenant to his property, such change can be made as a matter of right by the municipality, because the control of the streets and alleys is vested in the municipality by the Con stitution, and, in this instance, also by the city charter. This case falls within this latter class.
. 3. In plaintiffs’ amended bill of complaint, it is alleged that the provisions of the Michigan Constitution and of the Detroit charter under which the defendants assert power to act in the matter of vacating this alley ■are void because of being in conflict with the Fifth .and Fourteenth Amendments to the Constitution of the United States. These provisions forbid taking private property without due process of. law. But if, as pointed out above, under the circumstances here involved, there is no taking of private property or rights, then, as applied to the facts and issues in this case, neither section 28 of article 8 of the Michigan Constitution, nor the Detroit charter provision can be held to be in contravention of the Federal Constitution.
And for the same reason, the charter provision is not in violation of section 1, or section 2, article 13 of the Michigan Constitution (eminent domain), as is contended in plaintiffs’ brief. In a case involving similar questions, Chief Justice Wiest said:
“The question of eminent domain is not involved. By no stretch of imagination can it be said that property rights of plaintiffs are taken.” Tomazewski v. Palmer Bee Co., 223 Mich. 565, 569.
Plaintiffs have cited and rely upon Horton v. Williams, 99 Mich. 423, and Smith v. McDowell, 148 Ill. 51 (35 N. E. 141, 22 L. R. A. 393). The Horton Case has been distinguished by former decisions so clearly from one like the instant case that it seems unnecessary to repeat here. See Phelps v. Stott Realty Co., 233 Mich. 486, 493. In citing the Smith Case in plaintiffs’ brief, it is said:
_ “The State of Illinois has directly decided the question as to whether a statute giving the municipal corporations control of the streets and alleys within the municipality gives it the power to vacate the same or any portion thereof, for the 'benefit and use of a private person.”
But this decision is not an authority on the question now before this court, because it appears that, except as delegated to the municipality by the legislative enactment, the plenary power over the roads and streets of Illinois remains in the legislature; while in Michigan the Constitution has reserved to the cities, villages, and townships, all reasonable’control over the streets and alleys. And, further, the Smith Case involves the rights of the public in streets as contradistinguished from the rights in alleys. ■ The marked difference in the rights of the general public in streets as compared with its rights in alleys has been plainly indicated in former Michigan decisions. Bagley v. People, 43 Mich. 355 (38 Am. Rep. 192).
It is also evident that the plaintiffs cannot successfully claim that because the method of procedure is not specified in the Constitution or in the city charter by which the municipality is to enforce its power to control or vacate, therefore the present proceedings are void. These plaintiffs have been present and have been heard at every essential stage, and they cannot now complain because of lack of notice. Moreover, in the absence of some express provision of the law to the contrary, it is not requisite that notice should be given. 3 McQuillin, Municipal Corporations, p. 3004; Dempsey v. City of Burlington, 66 Iowa, 687 (24 N. W. 508); Baudistel v. Railroad Co., 113 Mich. 687.
The decree is affirmed, with costs to the defendants.
Sharpe, C. J., and Bird, Flannigan, Fellows,1 Wiest, Clark, and McDonald, JJ., concurred. | [
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Bird, J.
(dissenting). Plaintiffs own the Harding apartments, in the city of Detroit, the estimated value' of which is $375,000. On the 12th day of July, 1922, they leased the building to defendant Misner for a period of 15 years at a monthly rental of $2,900 and the taxes and insurance. The lease was the ordinary real estate lease of such property. The lessee soon proved to be a slow payer. He was in default each month until a proceeding was commenced against him before a circuit court commissioner. He paid the taxes only in part and defaulted on the insurance. It was also shown that the lessee misused and seriously damaged the premises, and that during the time he occupied them they gathered a very unfavorable reputation on account of the immorality of women, who lived or visited there. The prosecuting attorney of Wayne county finally filed a bill to get permission to padlock it on this account. Plaintiffs soon grew very tired of this sort’ of a tenant, and, on December 10, 1923, plaintiff Samuel Pelavin and his attorney went to the apartments. They found Mrs. Misner, the wife of defendant, in charge. Plaintiff Pelavin introduced his attorney to her as a prospective purchaser and requested her to show him around the apartments. She complied, and, on the pretext of examining something on the outside of the building, they went into the alley to inspect it, and when Mrs. Misner and the attorney were once outside Mr. Pelavin closed the door and locked it. In this way Mr. Pelavin took possession of the premises. • When Mr. Misner returned from the city he was denied admission. He made threats that he would regain possession and that he would kill plaintiff Pelavin. This bill was then filed for a temporary and permanent injunction, prohibiting defendant from interfering with plaintiffs’ possession. Defendant answered and filed a cross-bill, claiming plaintiff took possession by force, and that he was entitled to be repossessed of the property. He claimed in his cross-bill that he was in arrears for only two months’ rent, and plaintiff refused to accept that unless he would make certain payments on .the furnishings, and he prayed for. an accounting.
Upon the hearing the court refused to go into the question of accounting, but did take the proofs on the question of forcible ejection. He did not decide that question, however, but did order a decree protecting plaintiffs in their possession by continuing the injunction.
When the proofs were closed the chancellor should have determined the question of forcible entry and detainer, because that was the principal issue in the case. Had he found that plaintiff secured possession forcibly in violation of the statute, that would have been an end to the controversy, because, however clear plaintiff’s right was to possession, he had no right to acquire it by force. If he found the possession was obtained peaceably this would not justify a continuance of the injunction unless he further found that plaintiffs were entitled to the possession by reason of the failure of defendants to comply with the provisions of the contract', and that the same had been forfeited.
Defendants insist that possession was obtained by plaintiffs by force. The proofs on that question do not show any force was used. No force was offered and none was threatened. The possession was really gained by strategy or trick, but was gained peaceably. There may have been some force used to keep the possession after it was obtained, but this was permissible. Hoffman v. Harrington, 22 Mich. 52.
_ “To render an entry forcible it must be accompanied either by actual violence, or by circumstances tending to excite terror in the owner or other persons in possession, and to prevent them from maintaining their rights. There must be at least apparent violence or some unusual weapons, or the attendance of an unusual number of people; some menaces or other acts giving reasonable cause to fear that the person making the forcible entry will do some bodily harm to those in possession, if they do not give up the same.” 19 Cyc. p. 1136.
See, also, Cockerline v. Fisher, 140 Mich. 95; Marsh v. Bristol, 65 Mich. 378; Gillespie v. Beecher, 85 Mich. 347; Smith v. Loan & Building Ass’n, 115 Mich. 340 (39 L. R. A. 410, 69 Am. St. Rep. 575) ; Pendill v. Union Mining Co., 64 Mich. 172.
If the injunction was to be continued the question then arose as to the right of possession. This depended. on the question whether defendant was in default on his lease, and whether it had been forfeited. The testimony on this question should have been taken by the court and the question decided. The case should be remanded for proofs on that question. If found not in default defendant should be put into possession again. If found in default on his lease the present decree should be affirmed. Costs of this court should abide the finding on this question.
McDonald, J., concurred with Bird, J.
Wiest, J.
The question here presented is: May a landlord, if rent is unpaid and the tenant is guilty of permitting an improper use of the premises, visit the premises leased, request the wife of the tenant in charge of the premises to step outside of the building to show a pretended purchaser where repairs are needed, then lock the door and when the woman immediately enters by opening another d.oor with a latch key, forcibly prevent her from going upstairs and thereby obtain a possession recognized as valid and to be maintained under injunctive process from a court of equity? I think not. Such an invasion, under color of a legitimate purpose, supplemented by stratagem or trick, carried' out under a false pretense and successful for a moment only, did not result in a possession recognized by the law. But, even if a peaceable entry, it was followed by a forcible detainer when the entrant evinced the purpose by force, if necessary, to prevent the wife of the lessee from going about her affairs in the building. I think the’ evidence in this case shows- a forcible entry and detainer.
This court said in Seitz v. Miles, 16 Mich. 455, and repeated it in McIntyre v. Murphy, 153 Mich. 342:
* *' * “but if the entry be obtained by stealth or stratagem, or without real violence, and the party entering evinces his purpose in having entered to have been the expulsion of the party in possession, and it is followed up by actual expulsion by means of personal threats or violence, or superior force, it will amount to a forcible entry.”
The act of entry is coupled with the act of expulsion when the acts are contemporaneous or so close in point of time as to constitute one occurrence. There was a forcible entry and detainer and the court below should have so held. On this point we need but quote from the testimony of Leonard C. Lendzion, a witness for plaintiffs:
“I am* a lawyer. * * * I went to the Harding apartments in the city of Detroit on the 10th day of December, 1923, in company with Mr. Pisula and the Pelavin Brothers, Sam and Morris. When we got to the building, Sam and myself went in first. The others remained outside — where I don’t know. * * * Mrs. Misner was in the lobby in the building when we got there. Sam Pelavin informed Mrs. Misner that I was a buyer, and then she immediately proceeded to show me through some apartments and after noticing two or three apartments, then Mr. Pelavin stated that I was very much interested in the boiler or the steam plant, and I said yes, * * * and so we went down through the corridor and down into the boiler room and there we looked around, and I was mostly interested in the janitor to see if he was around there, and he wasn’t there. And after remaining in the boiler room about two minutes, then Mr. Pelavin stated that there was something wrong with the walk in the rear of the building. I believe he said the cornice or some part of the walk. And Mrs. Misner was surprised to hear that and I said that I would like to see it. And then Mr. Pelavin led Mrs. Misner and myself towards the rear door. Mrs. Misner and myself went out, and after we were out I heard the door slam, and a thud — presumably a lock of some kind was latched. And Mrs. Misner got out maybe five or ten feet from the sidewall of the building in the alley towards Cass avenue and she looked up, and so did I. Asked me if I seen anything wrong, and I said ‘No.’ At that time we were in the alley. I know where the court is — we had gone out through the court — we had to to see that side of the building. * * * Then I handed Mrs. Misner a .paper and told her that I was delegated to serve her with that paper, and she accepted it, and while she was reading it, I told her what it was, informed her of the fact that it was a forfeiture of the lease for nonpayment of .certain instalments on furniture and rents. * * *
_ “Q. After you served the notice upon Mrs. Misner, did Mrs. Misner say anything?
“A. Yes. She said that, ‘Then this is nothing but a ruse,’ or some language to that effect. Perhaps, maybe, the word ‘trick’ was used ‘to get me out.’ I says, ‘That is it, exactly,’ and then told her perhaps some day she might be in the same position as the Pelavin Brothers and would resort to the same thing. And altogether I would say that we were ■ out there about five minutes. * * * And then we walked down the alley, that is, the alley towards the front of the building. * * * and Mrs. Misner went into the vestibule. * * *
“Q. And what is your estimate of the length of time that elapsed between your going out of the Harding Apartments with Mrs. Misner and your leaving the premises, at which time Mrs. Misner was still in the vestibule ?
“A. At least ten minutes.”
Tricks and stratagems have been employed to get possession but never so bald-faced and inept as in this instance.
The Pelavins were guilty of a forcible entry and detainer, and their asserted peaceable entry and possession was but a travesty. The decree here should so declare and the case should be remanded to the circuit to determine the' damages occasioned defendants Misner. Plaintiffs claim this may not be done, although asked b.y the answer in the nature of a cross-bill. In the bill plaintiffs set up a peaceable entry and possession and obtained an injunction, and defendants- Misner had a right to traverse the claim and seek their damages in the very suit and. forum selected by plaintiffs. Defendants Misner should recover costs of this court.
Fellows, Clark, and Sharpe, JJ., concurred with Wiest, J.
The late Justice SNOW and Justice Steere took no part in this decision. | [
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Sharpe, C. J.
On December 4, 1925, plaintiff gave his note to W. G. Arthur Reid in the sum of $27,500, and to' secure the payment thereof executed a mortgage on certain real estate then owned by him in the city of Detroit. The amount thereof was payable in monthly installments of $500 each, the whole sum to be due and payable in two years from the date thereof. On June 11, 1926, Reid assigned the mortgage and note to the defendant. At that time several of the monthly payments were due and unpaid. On September 25, 1926, defendant began foreclosure proceedings by advertisement, pursuant to the statute. Before the sale was had thereunder, plaintiff filed his bill of complaint herein, alleging that the actual amount secured by the mortgage was $20,000; that the. sum of $7,500 thereof was a bonus exacted from him by Reid at the time it was given,' and praying that defendant be enjoined from proceeding further with the foreclosure proceedings. A temporary injunction was granted, but later dissolved. The bill did not contain any offer to pay the amount then due on the mortgage. . A sale was had, and the property was bid in by defendant for the amount claimed to be due and deed executed to him by the deputy sheriff. The trial court was not satisfied that the consideration of the note and mortgage was not as expressed therein, and dismissed the bill of complaint. Plaintiff appeals.
The plaintiff for many years had been engaged in the real estate and building business, dealing considerably in subdivision properties. He testified that he had “handled millions of dollars’ worth of property.” It appears that on-April 27, 1923, certain lots in the Mulberry Hill subdivision in the city of Detroit (about 95 in number), owned by plaintiff, were mortgaged by Peter A. Miller, in whom the title stood, at plaintiff’s request to Reid to secure the payment of $78,000. In the mortgage Reid agreed to release certain lots from the effect thereof on specified payments being made therefor. Most of these lots had been sold prior to December 4, 1925, the date of the mortgage here involved. Certain releases had been secured and some of the lots sold, subject to the mortgage. Reid had himself made certain collections at plaintiff’s request. At that time the mortgage was past due. Plaintiff was also indebted to Reid for taxes paid by him, and also on what is spoken of as the Baltimore mortgage. On December 4, 1925, the parties met in Reid’s office and had an accounting. As a result thereof, plaintiff executed the mortgage for $27,500 and Reid gave him a check for $7,736.43. Plaintiff admits that he kept no book account of his dealings with Reid, but he presents figures, which he claims were considered on such accounting, which indicate that the indebtedness secured by the mortgage was but $20,000. His claim in this respect is somewhat corroborated by the testimony of his stenographer, who claims to have been present. Reid testified that he had not kept the figures used on the accounting, which involved many items, some of which were in. dispute. He admits that he took credit therein for services which he had rendered the plaintiff in appraising the lots and making collections for him, but insists that no bonus entered into the sum as stated in the note and mortgage.
The consideration for a note secured by a mortgage, as between the parties thereto, may always be inquired into. But, as was said in Wiswall v. Ayres, 51 Mich. 324, 332:
“The presumption of mere fact is that the representation of the debt given in the mortgage by the parties to it was not false, but true, and nothing short of clear and cogent evidence could establish the contrary.”
Of course, it need only be established by a preponderance of the evidence. Badalow v. Bogosoff, 229 Mich. 299. To sustain plaintiff’s claim, we must find that he executed this note and mortgage for $27,500 the next day after he and Reid had met and by an accounting determined that the amount of his indebtedness, including the cash he was then to receive, was but $20,000. The amount of the claimed bonus, $7,500, in its proportion to the debt, is so large as to shock the conscience and to cause serious doubt whether a man of plaintiff’s business experience would execute a note and mortgage in which it was included. No matter how pressing his necessities, if the security was adequate, and there is no suggestion that it was not, he could surely have obtained a loan from some other person on more favorable conditions. The only other explanation of his conduct in doing so is that he fully understood that he could be required to pay but $20,000 and that he was willing to acknowledge in writing an indebtedness which he knew did not exist and for which he could not be held liable. An honest business man would not want to so stultify himself, and we are unwilling to do so.
Reid was apparently unable to state the particular items which entered into the accounting. He kept no account of the transaction in a book. He claims that certain releases of lots in the Peter Miller mortgage for which he had not been paid were taken into account and charged to plaintiff. He does, however, admit that he charged plaintiff with a service fee of $2,500 to cover “principal and necessary expenses that I had in arriving at the value of the' building that was mortgaged.” His testimony is suggestive that he was advised that he had a right to do this.
This leads us to infer that the holding of this court in Federal Bond & Mortgage Co. v. Burstein, 222 Mich. 88; is being misconceived. It was decided in that case that the service which the plaintiff company undertook to render in disposing of a bond issue, seeing to it that the payments made were applied to the purchase of materials and the payment of labor, and rendering other service to protect the purchasers of the bonds secured by the mortgage, was not. “a mere subterfuge for the purpose of exacting and collecting an illegal rate of interest on the loan.” This holding in no way supports the claim that a mortgagee may charge a service fee for examining the property to be mortgaged, or passing upon the sufficiency of the title, or for any expense deemed necessary and incurred by him in determining whether he will make the loan. These are but the usual incidents to the mortgaging of real estate, and are included in the rate of interest stipulated for in the mortgage. See Continental Nat. Bank v. Fleming, 170 Mich. 624, and cases there cited.
The defendant claims to be a holder in due course. While the assignment of the mortgage to him bears date June 11,1926, it was not recorded until September 21st of that year, and the foreclosure proceedings were begun five days thereafter and without any notice to or demand upon the plaintiff. On June 11th there was default in the payment of a number of the monthly installments. He claims to have turned over securities to Reid in the sum of $26,450, and to have given him a check for $550, thus making up the face value of the mortgage. The mortgage provided:
“That the whole of said principal sum shall become due and payable after default for more than 30 days in the payment of any installments of principal or interest upon said indebtedness.”
He was therefore not a holder in due course. 2 Comp. Laws 1915, § 6093. Neither do we think that he has overcome the presumption that he purchased with notice of the infirmity in the security. Thompson v. Village of Mecosta, 127 Mich. 522, 528. He testified:
“The substance is that I did not look it up, but took Mr. Reid’s word for it. * * * I did not see the mortgage before I purchased it. I took Mr. Reid’s word that the mortgage was all right. * * * I was depending on Mr. Reid’s advice in the matter.”
There is no offer in the bill of complaint to pay the amount found to be due on the mortgage. The prayer asks only that defendant be restrained from proceeding further in the foreclosure proceedings. No affirmative relief is prayed for in the answer.
A decree may be here entered setting aside the foreclosure proceedings had by advertisement and fixing the liability of the plaintiff on the mortgage at $25,000. As plaintiff has come into a court of equity asking relief, he will be required to pay interest on that sum at the rate of five per cent, per annum. There having been no offer on the part of the plaintiff to do equity, we think no costs in either court should be awarded to him.
Bird, Fellows, Clark, and McDonald, JJ., concurred. Wiest, J., concurred in the result. Flannigan, J., did not sit.
The late Justice Snow took no part in this decision. | [
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Wiest, J.
Defendant reviews, on exceptions before sentence, his conviction of a violation of the prohibition law, and, as the principal point he presents was decided adversely to his contention in People v. Feltner, ante, 209, we may make this opinion very brief.
An affidavit for a warrant to search the first story of his dwelling house and the outbuildings on his premises set forth:
“Deponent has seen whisky purchased on the premises, deponent has seen whisky on the .premises, deponent has seen intoxicated persons on the premises, May 8, 1925.”
Defendant’s motion to suppress the evidence seized under the search warrant was denied and objections to its admission at the trial overruled. . In the Feltner Case we held a similar affidavit with a like tailpiece date good, and we again make the same holding, intimating, however, that a little more care in justice’s ■court is highly desirable and would materially lessen the work of reviewing liquor cases.
The officers in their search found three quarts of “moonshine” whisky in a little compartment built beneath the backhouse seat, and discovered three intoxicated men and defendant seated at a table in the dwelling with a bottle of “moonshine” whisky before them. We think there was no error in admitting this testimony. The officers were rightfully there in quest of liquor and the intoxicated men and the bottle of whisky were in plain view.
The point that the body of the warrant did not carry -the allegations of fact made in the affidavit, and, therefore, was invalid under the holding in People v. Moten, 233 Mich. 169, was;'not raised in the circuit, and is not before us by way' of any exception.
Counsel for defendant very frankly stated to the trial judge:
“If this evidence was properly obtained and this was a good search warrant and they had a right to introduce the testimony that has been introduced here, then there is no defense to this action at all.”
Defendant offered no evidence. The exceptions have no merit. We are constrained to hold there was no defense.
The conviction is affirmed and judgment advised.
Bird, C. J., and Sharpe, Snow, Steere, Fellows, Clark, and McDonald, JJ., concurred. | [
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Bushnell, J.
After the death of George W. Balch in 1911, his widow, Mary E. Balch, and his four children, Kate Balch Mattoli, Elizabeth Balch Ranney, George C. Balch, and Frederick A. Balch, as trustees under an “agreement of trust,” united in appointing defendant Detroit Trust Company as their agent. The Balch trust terminated upon the death of the widow, Mary E. Balch, on June 18, 1932. Soon thereafter, plaintiff herein, Frederick A. Balch, one of the trustees, filed a bill of complaint for an accounting, naming as defendants the other surviving trustees and the agent. This matter was finally heard in 1934 and a decree was entered by the late Judge Harry B. Keidan in accordance with a settlement agreement between the parties, dated April 18, 1934.
In the accounting proceedings it was shown that at the time of the closing of the banks of Detroit by proclamation of the governor in February of 1933, defendant trust company, as agent of the trustees, had on deposit in a fiduciary account in the First National Bank-Detroit, $25,036.83, one-half of which had been paid or applied by the receiver of the bank against an indebtedness, and the remainder was impounded and unavailable.
The settlement agreement provided in part as follows:
“The Detroit Trust Company agrees to collect and receive such funds to the extent to which the same may be collectible from said First National Bank-Detroit and in full from said Detroit Savings Bank, subject only to solvency thereof, and to promptly pay over all sums so collected together with a pro rata portion of any interest so collected to said Balch trustees, all without further charge by said Detroit Trust Company for services and expenses in so doing. Said sums so collected shall be paid over to said Balch trustees by Detroit Trust drawing its check payable to said three trustees or the survivors or survivor and delivering the same to any of said trustees. ’ ’
The liquidation and distribution of the trust assets had not been completed at the time of the death of Elizabeth Balch Eanney. Frederick A. Balch, plaintiff herein, as sole surviving trustee, filed a further petition in the same cause on June 20, 1940, seeking further relief in the liquidation proceedings. As a result of this petition a supplemental decree was entered by Judge Keidan on July 15, 1940, which stated in part that, “all of the parties to this proceeding and all of the parties interested in the property now held in said safe deposit box and in said trust and the accounting therefor and in the undistributed residue of the trust funds thereof, appearing and consenting to the following order and supplemental decree * * * it is ordered, adjudged and decreed,” et cetera.
This supplemental decree contains detailed provisions for completion of the distribution of the assets of trust. When it was entered, the balance in the fiduciary account in the First National Bank-Detroit had been reduced to $5,085.58, and plaintiff Balch was ordered forthwith, “upon obtaining access to said safe deposit box, (to) pay to the following persons the following amounts in cash and'cause to be assigned to each of said persons the following face amounts of the remaining $5,085.58' of impounded bank balance with the First National Bank-Detroit, to-wit: ’ ’ one quarter to plaintiff Balch, one quarter to the executors of the will of Elizabeth Balch Eanney, deceased, one quarter to.tbe execu tors of the will of George C. Balch, deceased, one eighth to Agostino Mattoli, and one eighth to Giorgio Mattoli, the children of Kate Balch Mattoli, deceased, or their attorneys in fact.
It subsequently developed that $5,085.58 was not the correct balance but that it was in fact $4,974.16. After the entry of the supplemental decree plaintiff Batch’s attorney addressed a letter to the trust company under date of August 2, 1940, which referred to the supplemental decree, and requested that certificates of beneficial interest be issued to the beneficiaries named above, and in the same proportion, covering the corrected amount just stated. Such certificates were issued in which the trust company, as agent, agreed to pay the beneficiaries therein named— £his (her) proportionate share of any and all funds released by First National Bank-Detroit in further liquidation of said fiduciary account as soon as reasonably possible after such liquidation payment or payments have been received.”
The full amount of the bank balance was received by the trust company on November 1, 1940, distributed to the beneficiaries and the certificates of beneficial interest were surrendered and cancelled. Two years later, the trust company received from the receiver of the bank an “interest claim settlement. dividend. ” This dividend covered interest calculated over the period while funds were in the hands of the bank since its closing in 1933, and amounted to $1,894.04.
Plaintiff Frederick A. Balch, as surviving trustee, and his attorney claimed the entire amount of this fund by reason of paragraph (d) of the supplemental decree under which certain specified assets were assigned to them, “in full accord and satisfaction of any and all lawful charges which they, or either of them, have or claim to have upon said trust funds, for trustee fees as trustee or surviving trustee of said trust and as attorney for such trustee and/or surviving trustee.” Among the assets so assigned was an item described as, ‘ ‘ The rest, residue and remainder of said trust funds and property of whatever name and nature, $1.”
Defendant trust company took the position that it did not claim this money or any part of it, but it did not agree with the contention of plaintiff and alleged that other parties had made conflicting claims thereto. .
Balch and his attorney filed the instant petition on August 11, 1944, and, after a hearing before Judge Keidan’s successor, Judge William Friedman, an order was entered for the payment of the $1,894.04 to the several beneficiaries of the Balch trust, their successors, representatives and assigns, in the proportion stated in the Keidan decree. The trial judge in the opinion dictated in open court said the following, with reference to the Keidan decrees :
“There was no guarantee or assurance that the beneficiaries would receive the full amount set forth in these certificates as an unliquidated balance. They might have gotten less. It happened they got more. That was purely a contingent proposition. ’ ’
Plaintiff and his attorney have appealed from the order directing such distribution of the fund.
Appellants’ position is that the trust company, by its erroneous certification of fact in its “certificate of beneficial interest,” improperly effected a modification of Judge Keidan’s supplemental decree, and that Balch is not estopped by his acceptance of such certificate, and he and his attorney are still entitled to receive the total amount of interest dividends under that portion of the supplemental decree which assigns the “rest, residue and remainder” of the trust funds and property to them in lieu of their fees. They further contend that the acceptance of the certificate by Balch, and payment thereof, did not constitute a waiver of their right to “after-acquired or pick-up assets of the trust. ’ ’
Appellees state the problem in this fashion:
“Where a court order in distribution of a trust directs specified face amounts of a remaining impounded balance of an account of the trust in a closed bank to be assigned to each of the several beneficiaries, do the beneficiaries take any possible interest which may be paid by the receiver of such bank on the accounts therein (or is such interest taken by the trustee and his counsel for their fees as being a part of the rest, residue and remainder of the trust estate) ?”
In reviewing the matter de novo, we are not bound by the reasoning in the.opinion of the trial judge. As we view the situation, neither the original nor supplemental decree of Judge Keidan contemplated any further income by the trust, and all parties completely overlooked the possibility of a further realization by way of interest dividends on impounded bank funds.
Interest has been defined as “a charge for the loan or forbearance of money,” Eames v. Barber, 192 Mich. 1, 14. It “is paid for the use of money,” Coon v. Schlimme Dairy Co., 294 Mich. 51, 56; or “given for the delay in the payment of money,” Drennan v. Herzog, 56 Mich. 467, 469.
Under generally understood and applied princi-. pies, it “is merely an incident of the principal and must be accounted for,” School District of the City of Pontiac v. City of Pontiac, 294 Mich. 708, 716. See, also, Stewart v. Barnes, 153 U. S. 456 (14 Sup. Ct. 849, 38 L. Ed. 781).
Plaintiff Balch, the surviving trustee, and his attorney seek equity and, consequently, they must do equity. They cannot be heard to complain because a court of equity directed that interest on impounded1 funds be paid to those entitled to the impounded funds, in proportion to their share therein. That is what the court did in the instant case. The interest received by defendant trust company as agent of the Balch trustees was a part of the original fund and incident thereto.. The construction by Judge Friedman of Judge Keidan’s decree was proper.
The order which was entered1 in this cause on November 20, 1944, and from which plaintiffs have appealed, should be affirmed.
Defendant Detroit Trust Company has urged that notwithstanding the fact it claimed no right in the fund in question, it was forced to appear, answer and contest plaintiffs’ petition, or pay at its peril. Petitioners did not bring other necessary parties before the court, and the trust company was alone required to defend. Not being able to charge anyone additional fees for such service, it has requested that we allow it the necessary cost of the litigation that was forced upon it. In support of its position it submits as authority Cleveland v. Second National Bank & Trust Co. (C. C. A.), 149 Fed. (2d) 466. Certain phases of that litigation appear in Second National Bank & Trust Company of Saginaw v. Reid, 304 Mich. 376. In that case the court of appeals approved an allowance of costs of litigation to the trustee. We feel such an .allowance is proper in the instant case and proofs of such costs may be submitted and taxed.
The order is affirmed, with the allowance to appellees of the nSnal costs on appeal, and snch additional costs as have been directed herein, same to be paid by appellant Balch individually.
Starr, C. J., and North, Butzel, Sharpe, Boyles, and Reid, JJ., concurred. The late1 Justice Wiest took no part in the decision of this case. | [
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North, J.
This is a libel suit. Plaintiff for more than 15 years prior to 1938 practiced as a masseur in Detroit. The defendant, Doctor Henry Vaughan, for many years and at the time of the alleged libel was a member of the board of health of the city of Detroit; and defendant Eleanor McGarvah at the time of the alleged libel was a supervising nurse in the Detroit department of health and an assistant to Major Roehl who was also connected with that department. On trial before a jury in the circuit court plaintiff had a verdict and damages in the amount of 12 cents. After verdict, on defendants’ motion for judgment non obstante veredicto, a judgment of no cause of action was entered. Plaintiff has appealed and asks that a new trial be ordered.
In 1938, an ordinance became effective in Detroit which required that those who desired to practice as masseurs should take and pass an examination as a prerequisite to being licensed to practice. This examination was under the supervision of the city department of health of which defendant Doctor Vaughan was the head. In 1939, plaintiff took the examination, but failed to pass. Thereupon he filed a petition with the Detroit -common council to be granted a license, .notwithstanding he had failed to pass the examination. This petition was referred by the common council to the department "of health, and an answer to the petition was filed with the common council by that department. Defendant Eleanor McGarvah had taken part in conducting the examination which plaintiff failed to pass. She, apparently at Doctor Vaughan’s request, prepared the answer to plaintiff’s petition and submitted it to Doctor Vaughan. He signed the answer and it was filed with the common council. This answer contained the following:
“Replying to the tenth paragraph, this department submits a report of the violations of the medi cal practice act: Case No. 1,1-25-20, the petitioner through the press offered to cure any one suffering from influenza. He was prosecuted for violating the medical practice act. His case was dismissed 2-25-20 as he promised not to practice medicine any more. Case No. 2, 11-3-22, William Tease, 4142 Grand River avenue, signed a complaint charging Mr. Power with practicing medicine without a license. Mr. Power was bound over for trial 12-18-22 and after five adjournments his case was nolle prossed, as the complaining witness could not be found.”
The alleged libel in the instant case is based upon the foregoing portion of the answer to plaintiff’s petition filed with the common council. Court records introduced in evidence in the instant case of the two prosecutions of defendant referred to in the above quotation establish in every material respect the truth of this portion of the quoted answer except in two particulars. The court records do not disclose (and plaintiff denies) that incident to the first prosecution plaintiff herein “through the press offered to cure anyone suffering from influenza” or that the prosecution against him was dismissed “as he promised not to practice medicine any more.” But in determining whether either or both of these statements constituted libel in consequence of which plaintiff can recover, it must be borne in mind that on the face of the answer it appears defendants herein merely said: “Replying to the tenth paragraph, this department submits a report of the violations of the medical practice act, et cetera;” and that it was true there was a report literally in accord with the context of defendants ’ answer in the file of the health department; and further that this portion of defendants’ answer was in reply to the tenth paragraph of plaintiff’s petition filed with the common council wherein he had set forth: “That being a law-abiding citizen and being desirous' of complying with the laws of this city and State” he applied for ánd took the examination to which reference has hereinbefore been made.
The report in the files of the health department was made by Major Roehl whose duties in that department included making investigations and reports to the department of alleged violations of the medical practice act. The above-quoted portion of defendants’ answer to plaintiff’s petition is an accurate statement of matters contained in Roehl’s report filed in the Detroit department of health, and neither of defendants had any reason to question its verity.
In the foregoing we have not made note of plaintiff’s claim that the recital in the above-quoted answer that the second prosecution against plaintiff “was nolle prossed, as the complaining witness could not be found, ’ ’ was not an accurate statement of the record made in the trial court wherein it was stated: “Verdict dismissed on motion of defense.” We deem this slight variance immaterial and in no sense libelous. Further, undisputed testimony in this case discloses that on an adjourned date for hearing the criminal case the complaining witness could not be found.
The grounds urged in support of plaintiff’s claim that he is entitled to a new trial are: (1) that the trial court erred in receiving certain evidence, (2) that the court abused its discretion incident to the cross-examination of plaintiff, (3) That the court erred in receiving certain oral testimony and written notations which plaintiff claims tended to conflict with records of the recorder’s court of Detroit, (4) that there was error because of certain prejudicial remarks made by the court and like remarks by defendants’ counsel, and (5) that the court erred in its charge to the jury “in emphasizing the proposition of six cents verdict.” We have given consideration to each of these claims but find them to be without merit. In any event, in view of the fact that decision on this appeal is controlled by our conclusion hereinafter expressed on another phase of the record, discussion in detail of the foregoing alleged errors would serve no purpose.
The controlling question on this appeal is whether the trial court was in error • in entering judgment notwithstanding the verdict. There is no dispute concerning the facts or circumstances which gave rise to the issuing or publication of the alleged libelous statements upon which plaintiff relies. The record shows that the trial judge in granting defendants’ motion for judgment non obstante veredicto based decision upon his conclusion that there was no evidence tending to establish malice on the part of defendants.
Our review of the record brings the conclusion that, as asserted by defendants, under the circumstances of this case the alleged libelous communication to the common council of Detroit was absolutely privileged. By filing his petition with the common council plaintiff sought to override the conclusion of the health department that his failure to pass the examination disclosed lack of qualifications to practice as a masseur. The common council referred plaintiff’s petition to the health department for “a recommendation” which in effect requested a reply by the department of health to plaintiff’s petition, and it was in this reply or answer that the alleged libelous matter was contained. . As hereinbefore noted all the department attempted to do in this respect was to submit to the common council the contents of the official file in the health department pertaining to plaintiff, and so stated as follows: “Replying to the tenth paragraph, this department submits a report of the violations of the medical practice act, et cetera.” There is no question about this report being a part of such files. The report was not prepared by either of defendants, but instead by Major Roehl, who testified to the truth of the matters contained in the report. • And the undisputed testimony discloses that defendant Eleanor McG-arvah, who prepared the answer filed with the common council, intended to be fair and believed the contents of the file in the health department were true. As to Doctor Vaughan, who was not a witness, there was no testimony that he knew or had reason to suspect any inaccuracies in the report. The common council was within the scope of its official duties in requesting a response to plaintiff’s petition by the department of health; and that department was also within the legitimate exercise of its official duties in making its report to the common council by way of an answer to plaintiff’s petition. Notwithstanding plaintiff points out that in the answer filed by defendants it is asserted that the former complaints against plaintiff for violating the medical practice act had no bearing “on the conclusions reached regarding petitioner’s qualifications to entitle him to a license,” we are not in accord with his contention that the alleged libelous statements were not pertinent to the matter under official consideration. That was a question of law for the court. Trebilcock v. Anderson, 117 Mich. 39. Surely the matter of which plaintiff complains had to do with whether the common council should grant or deny the prayer of plaintiff’s petition which was:
“That this Honorable Body reverse the order and action of the said board (of health), and order instead thereof, a license issued unto your petitioner herein. ’ ’
Nor are we in accord with plaintiff’s contention that it was incumbent upon defendants to investigate the court files in the two prosecutions of plaintiff for practicing in violation of the medical practice act before defendants were justified in reporting to the common council the relevant contents of the file in the health department.
Under the circumstances above noted it must be held that the alleged libelous matter was a part of the contents of a privileged communication, and being such, plaintiff is not entitled to recover.
“What is privileged in publications? The truth is privileged when published from good motives, and for justifiable ends. And that which is not true, but honestly believed to be true, and published in good faith, by one in the performance of a public or official duty, in certain cases, is also privileged. This is so in the case of communications made to a body or officer having power to redress a grievance complained of, or having cognizance of the subject matter of the communication, to some intent or purpose; and in cases where the communication is made confidentially, or upon request, where the party requiring the information has an interest in knowing the character of the person inquired after.” McAllister v. Detroit Free Press Co., 76 Mich. 338, 356 (15 Am. St. Rep. 318).
While not identical in their factual aspects, for decisions of this Court at least somewhat in the same field of law and holding communications of like character to be absolutely privileged, see Hart v. Baxter, 47 Mich. 198; Trebilcock v. Anderson, supra; Shinglemeyer v. Wright, 124 Mich. 230 (50 L. R. A. 129); Wells v. Toogood, 165 Mich. 677; and Bolton v. Walker, 197 Mich. 699 (Ann. Cas. 1918 E, 1007). The headnotes of the last-cited case contain the following:
“Words spoken by the president of the poor commission of the city of Detroit, who is ex officio a member of the city board of estimates, with power to participate in the deliberations and proceedings of such board, but without right to vote upon measures brought before it, at a regular meeting of the board, and in relation to a matter of public interest, imputing that a member of the board was susceptible to improper influences, by bribery or otherwise, are absolutely privileged, since such board has a function in taxation demanding the exercise of semi-legislative discretion. * * *
. “If the privilege in uttering slanderous words is absolute the questions of good faith and absence of malice are immaterial. * * # .
“Where the occasion and attending circumstances are not in dispute the question of privilege in uttering slanderous words is for the court.
“Where a privilege in uttering slanderous wo,rds is found by the court to be absolute a verdict should be directed for the defendant.”
Even if under the circumstances of the instant case the alleged libelous matter were to be considered as being published only under a qualified privilege, rather than an absolute privilege, still the judgment entered in the circuit court would have to be affirmed under Raymond v. Croll, 233 Mich. 268, 275, wherein we said:
“To overcome the presumption of good faith the circumstances must be such as to show that the defendant was actuated by a bad motive, which led him to take advantage of the occasion to injure the plaintiff. The court should not permit dishonesty of purpose to be lightly inferred from acts which are just as consistent with good faith as with bad faith. If the circumstances relied on as showing malice are as consistent with its nonexistence as with its existence, the plaintiff has not overcome the presumption of good faith, and there is nothing for the jury.”
Both before and at the close of proofs defendants moved for a directed verdict, but decision was reserved. There is no merit to plaintiff’s contention that defendants by asking a stay of proceedings after verdict waived the right to be heard on their motion for judgment non obstante veredicto. Nor was that right barred by reason of a judgment having been entered on the verdict. The circuit judge in setting aside the judgment did so on the ground, that it “was inadvertently and prematurely entered.” In this there was no error. Sheltrown v. Railroad Co., 245 Mich. 58, and Strausser v. Sovereign Camp of the Woodmen of the World, 283 Mich. 370.
The judgment entered in the circuit court is affirmed. Costs to appellees.
Starr, C. J., and Butzel, Bushnell, Sharpe, Boyles, and Beid, -JJ., concurred. The late Justice Wiest took no part in the decision of this case.
See 2 Comp. Laws 1929, § 6737 et seq. (Stat. Ann. § 14.531 et seq.).—Reporter. | [
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Wiest, J.
Paradise Gardens subdivision is in the county of Macomb, between the 10 and 11-Mile roads, about half a mile from Gratiot avenue. In September, 1921, plaintiffs had an equity in a home in the city of Hamtramck. Wladyslaw Dylewski owned three lots in Paradise Gardens. Harry Wasylyshyn is a real estate agent and plaintiffs listed their equity with him for sale or exchange and Dylewski also employed him to sell or exchange his lots. The real estate agent brought the parties to a deal, in which Dylewski gave plaintiffs the three lots, a half interest in a Ford truck being purchased on the installment plan, paid $175 in cash, and took over plaintiffs’ equity in their home at an agreed value of $3,000.
Claiming false and fraudulent representations, plaintiffs filed the bill herein for rescission. Decree was entered setting the deal aside, adjusting taxes paid, payments made on the land contract, use of premises and repairs, with a personal decree against the real estate agent for the commission paid 'him by plaintiffs. Defendants appealed.
But one alleged false representation need be considered. It is claimed by plaintiffs that the owner of the lots, and the real estate agent in his behalf and presence, stated the lots were on the 7-Mile road near Gratiot. This was denied. Defendants also set up the fact that they took Mr. Salata to view the lots, and he then had opportunity to note their location. Defendants did take Mr. Salata to the lots, but reached there after dark. The lots, as before stated, are between the 10 and 11-Mile roads, about half' a mile from Gratiot, but Mr. Salata was not acquainted with that section and this, together with the darkness, rendered him unable to note the location thereof.
The evidence satisfies us that the lots were represented to be on the 7-Mile road near Gratiot avenue. This was false. The lots are on Forest street, two and one-half miles beyond the 7-Mile road. Lots at the 7-Mile road are worth far more than lots in Paradise Gardens.
It would be of no benefit to the profession to quote the testimony. The want of fairness of the real estate agent is indicated in his admission that the three lots he engineered his client to take at a value of $3,000 were then worth but $1,400. In fact the three lots were not worth anywhere near $1,400. This agent, charged .plaintiffs $175 commission and tried to get. $150 commission from Dylewski. Again we have verification of the saying “No man can serve two masters.”
Mr. Dylewski appears to have an unreliable memory. He remembers that Mrs. Salata went with her husband to view the lots. All the other members of the party testified she did not go.
But it is said in behalf of defendants:
“We do not see how fraud could have been committed upon the plaintiffs, assuming the statements to have been made which they claim, because such statements did not have any significance, since they could not associate them with a location, about which they knew something and without such association of ideas, in other words, without knowledge of the character of the neighborhood which they claim the lots were represented to be located in, they could not have been deceived in any way. Defendants said nothing about the neighborhood.”
Of course, no authority is cited in support of this view. It does not appeal to us. When it was represented to plaintiffs that the lots were located at a mentioned point, even if such point was one not familiar to plaintiffs, they had a right to rely thereon, and defendants may not be heard to say that plaintiffs were so densely ignorant of streets and locations that the fraud they practiced could find no lodgment.
It is also insisted that plaintiffs did not tender a deed of the lots, release of the interest in the truck, or the $175 cash payment, before filing the bill, and are, therefore, without remedy.
Mr. Salata testified:
“After I found out where these lots were located, I went and talked with Mr. Dylewski. I told him the lots were too far away and not in the place that he said they were. I asked him what he would do to straighten it out, and asked him to give me back mine, and I would give him back his. He said what he wanted he had, and everything else was lost, and -I understood from that he meant that I had nothing else to do with it. I told him that he cheated me, that the lots were not where they were supposed to be — that I wanted my house back, and I would give him back the lots, but he would not do that. I asked him this several times while he was living in the house with me. I would see him almost every day while he lived there, and on every occasion I would talk about this deal, telling him that he had cheated me, and that I lost much money from this. It was several weeks from the time I asked him to give me back my house that I started this suit.”
Tender would have been an idle ceremony and the •attitude of defendants show a tender would avail nothing even at this date. Defendants are in no position to rely on want of tender. Snyder v. Markham, 172 Mich. 693; Cox v. Holkeboer, 200 Mich. 86; Burns v. Misura, 228 Mich. 152. The evidence supports the decree and equity and good conscience require that the wrong be righted.
The decree is affirmed, with costs to plaintiffs.
Bird, C. J., and Sharpe, Snow, Steere, Fellows, Clark, and- McDonald, JJ., concurred. | [
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McDonald, J.
(dissenting). This action was
brought to recover damages for personal injuries received in falling down a stairway in the defendant’s restaurant. The declaration alleges negligence on the part of the defendant, in that he did not keep the stairway lighted, that he did not maintain a railing along the side of the stairway, and that it was defectively constructed, the first step down being immediately inside of the door between the restaurant and the stairway. The issue involved the negligence of the defendant and the contributory negligence of the plaintiff. Both of these questions were submitted to the jury. The plaintiff recovered a verdict for $1,000. Notwithstanding this verdict the trial court entered a judgment for the defendant on the ground that the plaintiff was guilty of contributory negligence as a matter of law. Whether he erred in so doing is the only question presented by the record.
It appears by the plaintiff’s testimony that she is a married woman, 63 years of age. On the day of the accident, accompanied by her husband she went into the defendant’s restaurant for lunch. While waiting to be served she inquired for the ladies’ toilet and was directed by an employee of the defendant to a door opening upon a stairway which led to the basement. She testified:
“Well, I went to that door and when I took hold of the knob it opened a little and I see it dark in there and I just thought I would turn around and find the switch and in turning around there was no platform or anything there and my foot went down and that overbalanced me. * * * I didn’t see any stairway. I didn’t see a thing in sight.
“Q. Couldn’t you see in the dark?
“A. No, I couldn’t see anything. I didn’t see a thing.
“Q. Because it was dark in there?
“A. It sure was. * * *
“Q. It is clear then from your testimony that when you opened the door it was pitch dark in there?
“A. Yes.”
In view of this testimony, which under the circumstances must be taken as true, the trial court was in error in holding that the plaintiff stepped off into the dark space without taking any precaution to determine whether the stairway ascended or descended. There is no uncertainty in her testimony as to what caused her fall. She says that when she opened the door she was unable to see her way because of the darkness; that with her hand on the knob she turned on. the threshold, and as she was turning her foot slipped;; that she lost her balance and fell down the stairway.. These facts and the conflicting claims in regard to the lights and surrounding conditions made the plaintiff’s contributory negligence a question for the jury. It was therefore error for the court to enter the judgment non obstante veredicto.
The cause should be remanded to the circuit court that judgment may be entered for the plaintiff on the verdict. The plaintiff should have costs.
Bird, C. J., and Clark, J., concurred with McDonald, J.
Wiest, J.
The opinion of Justice McDonald does not touch the question of the negligence of defendant. The contributory negligence of plaintiff does not arise until defendant’s negligence appears. I have given the subject of defendant’s negligence thought and examination, have been unable to find satisfactory adjudications, and have reached the conclusion that mere want of a light in the stairway did not constitute negligence rendering defendant liable to one falling down the stairs. There was no defect in the stairway. It is common in private homes, especially in the, country, to have dark stairways to cellars and basements and no one ever considered such a want of care. If defendant was guilty of negligence, then plaintiff’s contributory negligence was a question for the jury.
The judgment is affirmed.
Sharpe, Steere, and Fellows, JJ., concurred with Wiest, J.
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Sharpe, J.
On July 1, 1918, plaintiffs executed and delivered to Moses Wartell a note for $6,000, payable in three years, with interest at 6 per cent. To secure this note, they executed a mortgage on certain real estate in the city of Detroit, which was duly acknowledged and recorded. Mr. Wartell died on December 21, 1921. Alleging that the mortgage had been paid in full, and that foreclosure proceedings were threatened, plaintiffs filed the bill herein, praying for a decree discharging it. The administrator of the estate and the widow, who was also made a defendant, answered, denying that the mortgage had been paid, and in a cross-bill prayed for its foreclosure. They were granted a decree, fixing the amount due at $4,247.75. The plaintiffs appeal.
It is plaintiffs’ claim that they have not only paid the debt secured by the mortgage, but that they made payments thereon in excess of the sum due, to the amount of $2,385.55. It is unfortunate that a»settlement was not had between the parties during the lifetime of Mr. Wartell. The plaintiffs had no proof except the testimony of Theodore Gerasimos, the mortgagor, who produced a number of checks, drawn to Moses Wartell and indorsed by him or his wife, and receipts bearing his signature, and other evidences of payment. The signatures were admitted by defendants’ counsel. Plaintiffs’ counsel sought to show by the witness that these sums, were paid upon the mortgage indebtedness. This proof was clearly inadmissible (3 Comp. Laws 1915, § 12553), and the court so held.
In our opinion, where there is proof of an indebtedness and proof of payments made to the creditor, without identification of the application thereof, it will be presumed that such payments were made to apply on such indebtedness. Harvey v. Quick, 9 Ind. 258; Frick v. Trustees of Schools, 99 Ill. 167. This presumption may be overcome by a showing that there were other dealings between the parties, on which the payments might have been made. After identifying plaintiff’s signature thereto, defendants’ counsel offered in evidence an agreement entered into between Wartell and the plaintiff on June 17, 1918, a few weeks before the date of the mortgage, which recited that plaintiff had given to Wartell a bill of sale of a soda fountain outfit to secure two notes in the sum of $5,350, payable in 6 months, and provided that on payment of the notes the property should be re- transferred to him. Defendants also sought to show by plaintiff that the soda fountain outfit was in the possession of Wartell at the time of his death, but, on objection of plaintiffs’ counsel, were not permitted to do so.
■ The fact that the receipts, checks, etc., offered by plaintiff showed that he had overpaid the amount due on the mortgage by more than $2,000 would, in itself, tend to show that there were probably other dealings between the parties, but we think defendants were also entitled to have the bill of sale received in evidence as further proof thereof, and to establish by competent evidence the facts relating to that transaction. Plaintiffs’ counsel in his brief says that “plaintiffs in this case have a mass of checks and receipts showing that that other matter was also very much overpaid” and that “none of these were put in evidence because the court below had ruled it out.”
It is apparent that the rights of the parties may not be fairly determined on the record before us. It would seem that counsel, after taking into consideration all of the dealings between these parties, should be able to arrive at a fair settlement of the matters in dispute. The defendants, if satisfied as to the sums which Wartell, or those representing him, received from plaintiffs, should be willing to give them credit therefor on the several items of their indebtedness, and plaintiffs cannot ask for more. In this connection it may not be improper to say that we agree with the trial court that the claim of usury is not established.
Section 12493, 3 Comp. Laws 1915, reads as follows:
“In all chancery cases, the court shall rule upon all objections to the competency, relevancy or materiality of testimony, or evidence offered, the same as in suits at law; and in all cases where the court is of the opinion that any testimony offered is incompetent, irrelevant, or immaterial the same shall be excluded from the record: Provided, however, That if the testimony so offered and excluded is brief, the court may in its discretion permit the same to be taken down by the stenographer separate and apart from the testimony received in the case; and in case of appeal, such excluded testimony may be returned to the appellate court under the certificate of the trial court: Provided, further, That where such excluded testimony is not taken and returned to the Supreme Court on appeal, if upon the hearing of such appeal, the Supreme Court shall be of the opinion that any such testimony is competent and material, it may order the same to be taken by deposition, or under a reference, and returned to said court.”
Should counsel be unable to reach a settlement, this court, on being so advised, will order further proof to be taken under deposition or reference, as counsel may agree.
Bird, C. J., and Snow, Steere, Fellows, Wiest, Clark, and McDonald, JJ., concurred. | [
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