Source: https://thompsononeillaw.typepad.com/tov_blog/business_litigation/
Timestamp: 2019-04-21 10:30:02+00:00

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The Estate of John Anthony Sdao sued Makki & Abdallah Investments and others, arguing that the consumption of synthetic marijuana had poisoned the decedent and resulted in his death by suicide. They presented an expert in forensic psychiatry to support their claim; he testified that small amounts of psychoactive drug can drastically impact behavior. The defendant SARA Corporation argued that consumption of the drug was not causally related to Sdao's suicide and presented the testimony of forensic pathologist Warren Spitz in support of it's defense. The trial judge summarily dismissed the family's negligence and warranty claims, but allowed it's consumer protection claim to go to the jury. The jury held that the company had violated Michigan's Consumer Protection Act, but that it didn't cause Sdao's death. The family appealed.
The high court affirmed the jury verdict. Two of the three appellate judges rejected the family's argument that the judge should not have granted summary disposition on the negligence theories. They held that the Corporation "could not reasonably have foreseen" that its product could increase the risk of suicide. The appeals court also rejected the family's argument that the jury should not have heard the voir dire questions directed to the expert's qualifications. The higher court pointed out that since Spitz was ultimately allowed to offer his opinion testimony, his answers to the voir dire questioning were relevant to the weight to be given to his opinions.
One judge disagreed with the lower court's decision to summarily dismiss the negligence theories, pointing out that the ultimate decision about legal causation is usually a fact question for jurors to decide. Nevertheless, since the jurors ultimately concluded that violation of the CPA did not "cause" the death, it appeared to be a moot question whether negligence caused it.
In the Allegan Circuit Court action involving the Estate of Franklin Denison and Palm Beach Polo Holdings, the Court of Appeals affirmed a judgment that the Defendant was guilty of unjust enrichment in its management of a rented marina. The Court also reversed the trial judge's decision not to allow fees and costs to the prevailing party.
Duma v. Carson City Hospital involved Marcia Duma's attempt to seek compensation from her former employer after she was fired during a "down-sizing." A 10-year ER nurse, Duma was accused of stealing pain medicines and falsifying records. She adamantly denied the claim and was incensed when management used the occasion to inform staff that there were "mounds of evidence" of her guilt and that she did not deny the claim or defend herself. She filed suit alleging defamation, invasion of privacy and intentional interference with a business relationship. The local trial judge dismissed all her claims, holding that the statements by management were "privileged."
The Court of Appeals upheld the dismissal of part of Duma's lawsuit, but reinstated two theories. The Appeals judges held that since she could only identify 19 people who had been told the false account of her firing, the "audience" who heard the "false light invasion of privacy" was too small to support that theory. The Court held that if she is to pursue her claim of wrongful interference, she will need to document her efforts to achieve employment after the defamatory statements, and the causative impact of the Defendant's interference with her ability to find nursing work.
With regard to the defamation claim, the Court affirmed the dismissal as to two management employees, who hadn't defamed her broadly enough, but reinstated the claim as to one manager and the Hospital. Since the statements were made in the course of the defendant's duties with the hospital, the hospital would be vicariously liable for any wrongful conduct. And since the statements were made by the Defendant manager to "improve morale" or to "stop rumors," they were made for the Hospital's own business purpose and not privileged. Since the statements were shared with non-management employees who had no "need to know," the law of defamation applied to make them potentially actionable.
In Lamiman v. Bank of NY Mellon Trust, the Michigan Court of Appeals again decided that a foreclosed homeowner lacks "standing" to sue the bank for fraud if the homeowner wasn't able to redeem the property. The family's "rights to the property are extinguished..." So, the people who suffer the greatest harm from a (perhaps fraudulent) mortgage and foreclosure are also prevented by a legal obstacle from pursuing justice.
Donald Krupinski lost both legs after a motorist waiting in line in a gas station surged ahead, striking another vehicle in queue, and causing a third vehicle to strike Krupinski's vehicle. At the time, Krupinski was negotiating the gap between the vehicles on his way into the Costco station in Shelby Township of Macomb County. Krupinski's lawyers hired an expert who offered the opinion that the design of the gas "hyper-station" was partially at fault in causing the injuries. He argued that designing the station so that multiple vehicles stacked up in collinear queues (i.e., directly in line) posed an unreasonable threat of similar injuries to pedestrians. He testified that reasonable design principles would offset the vehicles so that an error by one driver would not endanger multiple pedestrian passages between vehicles.
The Court refused to allow the expert to testify and summarily dismissed the case. The Court ruled that the expert's testimony did not meet minimal requirements for establishing negligence in a property or product. It held that the expert had not adequately addressed the dangers inherent in competing designs and did not sufficiently quantify the "magnitude" of the risks associated with the Costco design. Since he could not quantify the "likelihood of occurrence," his design theory was inadmissible; further, the court held that the risk of walking between vehicles was "open and obvious" and therefore created no duty in the landowner. The case against Costco was summarily dismissed.
In Younce v. JP Morgan Chase Bank, the plaintiffs sought to hold the bank accountable for using forged signatures to complete its foreclosure of their property in 2007. The Bank argued that the statute of limitations had run. The trial court agreed and the Court of Appeals upheld the decision because the plaintiffs "could have discovered the alleged forgery from the public record" and the husband admitted that he was aware of an improper lien on his house in "2009 or 2010."
Colby Smith lost a hand operating a Whirlwind jump saw at Michigan Pallet. He sued the company and two employee supervisors, arguing that they were not protected by the "exclusive remedy" provision of the workers compensation act because their intentional refusal to guard the saw created a statistical certainty that someone would be injured. The Court of Appeals agreed with Smith's experts and held that the conduct of the employer in failing to install and maintain the MIOSHA-required guard created circumstances that fell outside the "exclusive remedy" protection granted employers under workers compensation law. The Supreme Court reversed, holding in a one paragraph opinion that Smith's proofs were not adequate to show that the defendants had "a specific intent to injure" him. The proof must show that "an injury was certain to occur" and "willfully disregard" that knowledge.
A recently Oakland County case against the Philip R. Seaver Title Co. was summarily dismissed by the Court of Appeals, after the trial judge denied summary judgment. The homeowners had sued the title company employed by their bank, Charter One, after it distributed construction loan proceeds to the general contractor without verifying that subs had been paid. The homeowners argued that the title company was guilty of negligent breach of fiduciary duty and should be responsible for the unpaid sub-contractors' liens. The Court held that the Title Company "owed no duty" to the plaintiff's because the fraudulent, criminal behavior of the General Contractor was "unforeseeable." (We wonder by whom. This seems like the very essence of the purpose for escrow accounts and agents.) The Court held that disbursing money is a common obligation of a title agent, and since that duty was contained in the Defendant's contract with Charter One, the Defendant owed no duty to the homeowners outside the contract. A typical Kirsten Frank Kelly-pro insurance-anti-victim outcome.
In a recent holding by the Court of Appeals, the trial court's grant of summary disposition to Blue Cross Blue Shield was reversed, and the case, entitled Sault Ste. Marie Tribe of Chippewa Indians v. Blue Cross Blue Shield of MI, was reinstated. The Tribe sued the health insurer, claiming that the insurer made specific false representations about discounts and savings the tribe would achieve by contracting with BCBS to administer it's self-insured health plan. The insurer represented that it would give the tribe a 45.2% discount, rather than the 28.1% discount the prior administrator was charging, resulting in savings of $12 million dollars over five years.
The Tribe claimed the representations were false and that BCBS knew or should have known that they were not true. The judge had granted summary disposition, treating the promised inducements as sort of "puffing" or merely a promise of future efforts that is not actionable. The higher court concluded that there was a genuine question of fact with regard to whether the repeated claims were false statements of fact, recklessly or intentionally made with knowledge that they would reasonably be relied upon by Tribe administrators.
Court holds that leaving a message at your place of employment is not a "communication."
Under the Fair Debt Collection Practices Act, a debt collector's actions in "communicating" with a debtor are strictly limited. In Brown v. Van Ru Credit Corp., the plaintiff argued that the defendant violated the FDCPA when it left a voice message at the debtor's workplace requesting a return of the call.
The Court held that simply leaving a voice message requesting a return of the call is not a "communication" under the FDCPA because a "communication must convey...information regarding a debt directly or indirectly to any person through ay medium..." and such a message contains no information.
Michale Chelik broke an arm while in Lansing to assist in a theater production. Chelik was part of a Disney Broadway production at the Wharton Center when he fell while walking to his car. He was taken to Sparrow Hospital where his fractured left elbow and forearm were placed in a splint; he was discharged and told to see his orthopedic surgeon the following day. He asked not to be discharged, apparently, citing the fact that it was now 5:55 am, he was exhausted, and he had a 25-30 mile drive to his motel. The Hospital said it did not have a bed for him and called a cab.
While the cabbie was helping Chelik into the cab, Chelik fell and fractured his right arm. He later sued Sparrow for negligence, arguing that it owed a duty to allow him to stay on the premises, given the circumstances. The Court of Appeals upheld the trial judge's directed verdict against Chelik, ruling that "Michigan law does not impose a duty upon a hospital to assist a discharged patient with transportation."
Because Chelik was "stable" and the hospital had performed a "fall risk assessment" at some point prior to discharge, the judges ruled that it was "not reasonably foreseeable that plaintiff would injure himself." The Hospital "had no control" and "there was no special relationship between Sparrow and plaintiff." To his credit, Judge Hoekstra refused to sign on to the opinion authored by Judges Saad and Boonstra.
Gloria Watts fell on her way to the restroom at Fast Eddie's Oil Change in Ingham County. Perhaps the defendants worked a little too fast on this occasion, as Watts claimed that she fell in a slippery spot that smelled of oil. The owner's insurer argued that she was merely speculating about what caused her to fall and sought summary disposition, which the trial judge granted.
On appeal the higher court noted that even though Watts testified she did not see any oil on the red cement floor, her testimony formed a basis to have the jury evaluate her claim. It noted that immediately after she fell she attributed her fall to oil and claimed that the floor was "shiny and slippery" and "there was oil" in the area. It further noted that she claimed to have disposed of her clothing, because she could not get the oil washed out of it. Under these facts, the cause of her fall was not pure "speculation" and a reasonable juror could conclude that she knew what caused her fall.
In Bernstein v. Seyburn, Kahn, et al., the Michigan Supreme Court last month summarily denied leave to appeal sought by the defendant attorneys. The high court had initially told the parties to brief the issues, after the attorneys appealed a Court of Appeals' opinion that reversed summary disposition and reinstated a malpractice claim brought by a podiatrist against his attorneys.
The high court changed its mind and endorsed the reinstatement of the claim in a summary order. The Court of Appeals had concluded that the statute of limitation had not run on the podiatrist's claim that his attorney fraudulently concealed his breach of fiduciary duty by failing to disclose actions that were adverse to plaintiff's interest. It had also ruled that the retention of additional counsel, while the at-fault attorneys continued to provide general legal advice, did not commence the running of the pertinent statute of limitations.
This month, the Supreme Court responded to an appeal from the Court of Appeals by sending a case back to the lower court for further analysis. The case involved an action by a number of plaintiffs seeking discovery of the finances of the publicly-financed Michigan Catastrophic Claims Association (MCCA). The MCCA is funded by a mandatory tax on motorists seeking permission to operate a vehicle on Michigan's roads. It is used to fund medical expenses that exceed the threshold paid by the driver-owner's primary auto insurer. It is managed by the insurers, themselves, and although they frequently argue that Michigan's unlimited no fault medical coverage is inadequately funded, the insurers refuse to provide a public accounting of MCCA's assets and liabilities.
The lawsuit no doubt originated in the insurers' attempt two years ago, to grab the MCCA assets without assuming its residual medical obligations. That's right, it is our understanding that they sought legislation that would have resulted in their ability to walk away from the long-term care obligations the money was intended to fund, while keeping the money they had collected through a mandatory insurance fee. That was one step too far even for some Republicans and it didn't go far--but it most likely did prompt the lawsuit to uncloak the financial operations of the mandatory fund.
Several months ago the Court of Appeals held that the plaintiffs seeking an accounting of the MCCA's finances were not entitled to demand that information through the Freedom of Information Act. This month the Supreme Court went one step further and sent the case back to determine whether the MCCA is even a "public body" subject to the FOIA. Don't hold your breath waiting for an accounting of how the insurers are spending your money.
American Erectors placed its insurance through the McNish Group in Oakland County. It wanted to go cheap on labor, so it created an alter ego to employ workers. At the same time, it asked McNish to secure insurance on both it and the alter ego, to assure that it was covered in the event of injuries. Several months later, one of the plaintiff's employees was killed in an industrial accident; the insurer who had written the umbrella coverage wrote to the plaintiff informing it that the five million dollar umbrella would not cover the estate's wrongful death claim, because under the terms of the policy, the case pitted one insured against another.
While the case was pending the agency urged the plaintiff not to take legal action and to allow it to "manage" the claim through the trial. It specifically told the plaintiff employer that it had coverage for this kind of gap in coverage and that would take care of the matter if plaintiff lost the pending wrongful death case. It did, in fact, lose the case and suffer a seven million dollar verdict for negligence. It then sued the agent for negligence.
The Court upheld the dismissal of the insured plaintiff's case based on the statute of limitations. It pointed out that insurance negligence is not professional negligence and that the cause of action accrued when the umbrella insurer denied coverage (more than three years before the plaintiff filed its action against the agent). The Court further held that the agent was not "estopped" to assert the statute of limitations because its promises to address the problem down the road were merely promises of future action which the plaintiff should not have relied upon. To reach this conclusion, the Court of Appeals made the somewhat incredible finding that "McNish's representation that it would obtain affirmative relief...was ...not a false representation...designed to induce plaintiff to refrain from bringing a timely action."
It is a little hard to sympathize with a corporate employer "hung by its own petard," when it's attempt to reduce the rights of its own labor force backfires and results in a seven million dollar uninsured judgment. Nevertheless, it is even harder to justify a decision that does not hold a negligent (insurance agent) company to fulfill the explicit promises it has made to the victim of its own carelessness. But, when special interests dominate the judiciary, as insurance interests do in Michigan, this is the outcome you get.
The Estate of Clifford Proctor sued Forrest Aggregate, LLC, after Proctor was injured in the defendant's gravel mine. It secured a verdict for a little over $500,000.00, based on evidence that the defendant had failed to address warnings about braking inadequacy in the dump truck he was driving. The defendant admitted that it owed a duty under federal regulations to assure that equipment used in the mine was safe, but claimed that its' failures were not causally related to Proctor's accident and injuries.
The Court noted that the jury was presented with testimony confirming that the owner of the truck Proctor was driving had warned the mine supervisor about the brakes, along with testimony that the brakes felt "spongy" to the operator. There was also substantial testimony about air in the brake lines. The Court concluded that there was ample testimony to support the jury's verdict that the mine owner's negligence was a cause of Proctor's injuries.
James Holland was attempting to deliver mail on his regular 20-year route when he encountered an icy sidewalk in front of the Northville City Car Wash. As he was "picking his path" across the icy sidewalk, he was confronted by a driver leaving the car wash exit who appeared not to be attentive. In attempting to evade the exiting car, Holland slipped on ice and suffered a severely fractured ankle. He filed a lawsuit against the car wash, arguing that its operations resulting in an icy public sidewalk were a cause of his injury and a public nuisance.
The car wash did not deny that it caused the walk to ice over throughout the winter; its employee confirmed much of Holland's account of the incident. Nevertheless, the car wash's insurer sought summary disposition of Holland's claim, arguing that the car wash owed no duty to remedy the icy sidewalk because the hazard was an "open and obvious" danger. The insurer also argued that the ice didn't present a "public nuisance" as that term has been re-defined by insurance-oriented activist jurists. The trial judge agreed with the insurer and Holland appealed. On appeal, the Court of Appeals cited several recent Supreme Court decisions and concluded that Holland's case was properly summarily dismissed.
The judges held that since Holland had encountered the icy sidewalk on his postal route on numerous occasions during his twenty year work history, the ice was an "obvious" condition which the Car Wash owed no duty to remedy. It rejected Holland's argument that encountering the exiting car while he was attempting to negotiate the ice did not affect the operation of the "open and obvious" doctrine: since he chose to negotiate the icy hazard initially, the landowner's duty to remedy the hazard was eliminated. He was not "trapped" by the hazard, and admitted that he could have "refused to deliver the mail," and therefore the landowner who created the hazard was entirely "off the hook" for his negligence.
The Court also held that the icy sidewalk--which had now existed for most of twenty winters, apparently--was not a "public nuisance." The high court has re-defined public nuisance in recent years and suggested a very limiting application of the doctrine. A "public nuisance" must involve not only a defect but also "threaten danger to the public." It must be "harmful to the public health...create an interference in the use of a way of travel...and affect...peaceful use of...public streets." This certainly sounds like the icy walk meets the definition of a public nuisance, but the judges ruled that it was not, because the ice was not "of a continuing nature that produces a permanent or long-standing significant effect on the rights of the public" and because Holland did not suffer "damages of a special character different from the injury suffered by the public generally."
So with a few twists of language, a guy who has suffered a badly fractured ankle hasn't suffered damage different than the public who must "pick a path" through an icy sidewalk, and ice that accumulates on a sidewalk "on an almost-daily basis for 20 years" is not "permanent or long-lasting." We should just quit pretending and let the insurance industry write the rules the Court is to apply: the result would at least be more honest and subject to scrutiny.
Craft Recreation Company was forced to sue it's insurer, Home-Owners Insurance Company, after its bowling alley was destroyed by fire. The owners had purchased business insurance that would cover reconstruction, however, the fire damage was so extensive it exceeded the policy limits. Home-Owners argued that if the owners didn't re-build the alley (with inferior construction), it was not obligated to pay the policy limits that the owners had purchased. The owners argued that under the plain language of the statutory coverage, since the damage exceeded their coverage limits, the insurer was obligated to pay the limits regardless of whether the owners re-built.
The trial court reviewed the statute and the terms of coverage, along with the cost of re-building, and concluded that the owners were entitled to summary disposition. The judge ruled that under the statutory language, the obligation to re-build prior to payment did not apply if the structure could not be re-built with comparable materials to a similar "condition and appearance." Similarly, the policy required the company to re-build with "comparable material and quality."
The insurer appealed and its arguments were summarily rejected by a unanimous panel of the Court of Appeals. The appellate judges agreed with the trial court that since Home-Owners admitted that the cost of re-building a "comparable" structure exceeded the policy limits, the owners were free to "cut their losses" and simply pocket the insurance limits without re-building an inferior structure. The judges noted that if there was any ambiguity in the insurer's policy obligation, it must be interpreted against the insurer who drafted the policy.
As clear as this case seems, we'll see if it withstands scrutiny by the Republican insurance-oriented Michigan Supreme Court five-judge majority. They pretty much give the insurance industry anything it wants, and I'm sure that insurers would prefer to be able to walk away from insureds in this situation.
Titan Insurance Company sued American Country Insurance after Titan was tabbed to pay the PIP benefits for two different employee drivers who were injured while operating uninsured vehicles owned by limousine services that insured part of their fleet with American Country. Titan had been assigned both claims through the Assigned Claims Plan: it argued that as the insurer of other vehicles "owned" by the owner of the uninsured taxis, American Country should be the priority insurer under the no fault scheme.
American Country argued that the statute should be interpreted in a way that placed the burden of the illegally uninsured vehicles on the entire insurance industry (through the Assigned Claims Plan) rather than on a single insurer. Noting that to hold otherwise would read one section out of the statute, the Court of Appeals interpreted the poorly-designed statute to require the insurer of the owner's other vehicles to bear the normal PIP expenses of an uninsured vehicle.
Paterak Mold & Engineering moved to the Village of Armada after securing a Special Approval Land Use permit (SALU) allowing it to operate in an area not zoned for light industrial. Critics argued that Paterak never followed through on its obligations under the SALU, and when Paterak sought to expand its operations, one particular village official engaged in something of a crusade against Paterak. Perhaps one group would claim that Paterak was being held to its obligations, while the other group would argue that it was being persecuted.
Ultimately, Paterak filed a 1983 claim, arguing that its critics exceeded the boundaries of reasonable when they cited Paterak for infractions that the Village had previously approved, and eliminated the Downtown Development Authority that John Paterak chaired. The District Court had found Paterak in contempt and summarily dismissed his First Amendment and 1983 claims. The Sixth Circuit rejected the lower court's analysis and reinstated the plaintiffs' claim. It concluded that a reasonable jury could readily reach the conclusion that the defendants' actions were "arbitrary and capricious" and denied the Paterak plaintiffs' civil and constitutional rights.
Steven Hamilton sued Arthur Jeannot and others, alleging he had been treated badly in the attempt to renovate and reopen the Brookside Inn in Benzie County. The trial judge summarily dismissed his lawsuit and sanctioned his attorney for filing a frivolous claim. Hamilton and his lawyer appealed. The Court of Appeals reversed. It concluded that the lawsuit was not frivolous, and in fact that there were genuine issues of material fact to be decided.
The lower court had ruled that Hamilton must re-pay promissory notes that Hamilton had executed, despite his claim that the notes were part of a complicated business transaction that had not been fulfilled by the defendants. The higher court agreed that he raised questions of fact and pointed to the fact that he worked for 17 months on the renovation before he was "dismissed' by Jeannot. The appellate court emphasized contradictions in Jeannot's claims as simple as arguing that Hamilton paid the Inn staff, when they were, in fact, on Jeannot's payroll.
The Court also reinstated Hamilton's defamation claim arising out of Jeannot's statement that Hamilton "embezzled or attempted to embezzle funds." Although Jeannot argued that the related statements were merely "opinion," the Court noted that they alleged a crime and were therefore defamation per se.
Kyle Moore was hurt in a 2007 car accident. Through his father, he was a covered beneficiary with the ERISA National Elevator Inc. Health Benefit Plan [hereafter NEI]. The ERISA plan paid a little over $34,000.00 in medical expenses. Meanwhile, Moore sued the at-fault. His claim was ultimately settled for $500,000.00. Under Ohio law, the at-fault Defendants were allowed to deduct from their award any payment Moore had received from any third-party insurance source and the latter was denied any right of subrogation. NEI sued, arguing that the latter state law rules were preempted by ERISA rules granting NEI a "reimbursement" lien on the recovery.
Moore's attorneys argued that the Summary Plan Description [SPD]of the NEI plan, which contained the right of subrogation and reimbursement, was inconsistent with the actual plan governing documents, and that in any event the Ohio law extinguished any subrogation claim that NEI might have enjoyed. The Court rejected this analysis. It held that the SPD was in fact the controlling plan document.
The Court also held that NEI was entitled to full and complete reimbursement of its entire expense, and that Moore was entitled to keep settlement funds only to the extent that they exceeded the NEI lien: thus if the settlement had been for $34,000.00, total, NEI would be entitled to claim the entirety of it and Moore would be entitled to nothing--regardless of the severity of his injuries, his wage loss, or the compromise of his quality of life.
While the Court's decision seems a fair and appropriate result in Moore's situation-- because his ultimate recovery substantially exceeded his out-of-pocket medical expenses and the NEI lien-- the outcome is far more troublesome in most cases. In most cases, the ultimate recovery of an injury victim is substantially limited by insurance coverage and "collectability," and the out-of-pocket medical expenses are proportionately much greater. As a result, in most cases, the victim of a particularly severe injury is victimized a second time when his entire recovery becomes the property of the entity that financed his medical care.
Under the Court's analysis, the health insurer/ERISA plan manager is allowed to stand back and wait--and then seize the victim's entire recovery without paying any litigation expenses, without paying any attorney fees, and without recognizing that the victim has suffered a lifetime loss of income and normal enjoyment. Since the ERISA plan's right is unencumbered by any exceptions or limitations, the plan is under no pressure to compromise it's rights to achieve a balanced or reasonable allocation or outcome.
Ultimately, this is simply another example of how the escalating cost of medical care and special interest influence are threatening the well-being of ordinary people in the United States. Courts and legislators are willing to grant any accommodation to insurers and willing to impose any duties on consumers if the ultimate effect may be a slight downward influence on health care costs--even if the impact is an unreasonable burden on an individual or group that lacks influence.
Dasch, Inc. sued Signature Assocs., Inc., arguing that the defendant should be accountable for over-stating comparable rents in a "comps list." The buyer-Plaintiff argued that it over-paid for rental office space because the Defendants negligently and falsely over-stated the likely rental value of the space. In a bench trial, the judge ruled that although the Defendants prepared the "comps list without exercising reasonable care" the content was "merely opinion" and therefore not actionable. The judge held that the seller's agent would be responsible for negligent misrepresentations only if the Plaintiff proved that the agent knew that the claims were false and they were relied upon by the Plaintiff.
The Court of Appeals agreed with the trial judge that under Michigan law, the Plaintiff could not hold the seller's agent accountable for negligence unless the Plaintiff could prove that the agent knew that his representations were false before the buyer knew. Since the buyers here did not prove that the agent learned of the falsehood before the buyers, the buyers could not recover for the agent's lack of due care or negligent misrepresentations.
MIchael and Suzie Baker lost their home in a foreclosure action. The next year they filed for Chapter 7 bankruptcy. They later learned that the assignment of mortgage pursuant to which they were foreclosed was, in fact, fraudulently executed. They attempted to pursue a claim for damages. The defendants in the Baker's civil lawsuit contended that even if the Bakers could prove "a fraud upon the court," they had no remaining interest or standing to take legal action. The Court of Appeals agreed, holding that the Bakers sole remedy would have been to raise the "fraud on the court" argument in the Court where the purported fraud occurred.
Land Escape Outdoor Maintenance [LEOM] sued Insurance Advisors, Inc. [IA], in Oakland County Circuit Court, after one of its dump trucks incurred a liability claim. LEOM's insurer, Secura, had denied that there was liability coverage on the truck involved in the claim. LEOM sued its agent, noting that for a decade it had purchased insurance through IA that was reduced during winter storage periods. LEOM's owner manager testified that IA had represented to him that he would have limited liability coverage during storage periods; that it negligently allowed liability coverage to be removed; and that it negligently represented that the coverage was still extant.
During discovery it turned out that Secura, and not IA, had botched the coverage by making a misrepresentation about what equipment would have liability coverage and when. For that reason, LEOM's original complaint of negligent misrepresentation by the agent was summarily dismissed and the Court of Appeals upheld that outcome. Nevertheless, the judges concluded that it was error for the lower court to refuse to allow LEOM to amend its complaint to raise the failure by IA to write the coverage that its' insured had sought--and purchased.
The Court pointed out that even if LEOM should have read and understood that it had no liability coverage, despite IA's allegedly erroneous advice, this would be comparative fault and not entirely dispositive of LEOM's claim. Since IA negligently procured the wrong coverage and failed to respond to Secura's erroneous endorsement, LEOM had stated a valid claim against an independent insurance agent.
The Court also rejected the argument that insurance "professionals" should be protected by the shorter, two-year, statute of limitations governing professional malpractice. The Judges pointed out that a similar claim was recently rejected in the Court of Appeals and that, as the defendant agent explained during her deposition, her education was "irrelevant;" she "majored in English and education" and lacked any specialized education in a profession.
This month, the Republican-dominated Legislature granted broad immunity to "equine professionals" and "equine activity sponsors." Twenty years ago Michigan adopted the Equine Activity Liability Act that granted limited immunity to horse owners, but that immunity did not apply where there was documented negligence (the failure to act as a "reasonable person").
The new act, adopted in 2015, however, contains no exception: it grants immunity to horse people unless they demonstrate a "willful or wanton" indifference to an expected injury. They are no longer accountable for negligence--like the rest of us. The special influence Michigan judiciary has previously ruled that these "aggravated negligence" standards raise the threshold for liability well above lack of due care to an actual expectation of injury that is ignored.
It is hard to say just why we need to grant special protection from ordinary negligence to "equine professionals." Is it because horses cannot hurt a person or damage a car if struck while loose on the highway? Is it because they are a Yuppie female teen's best friend and status symbol? Is it because "equine professionals" were leaving the state in droves because of liability claims? (We couldn't find one in the last few years' of reported cases...) Or is it simply because the horsie industry has a lot of money and paid lobbyists who can buy special protection while the rest of us aren't looking?
Edward Stokes slipped on ice and fell after putting gas in his car. He fell in an area where gas station employees had recently dumped water on a previous customer's gas spill. There was divergent testimony with regard to the current and immediately prior weather conditions and widely divergent testimony about the visibility of the icy condition where Stokes fell. The Court of Appeals rejected the trial judge's conclusion that the black ice was, as a matter of law, an "open and obvious" hazard which the gas station owed no duty to alleviate. The judges agreed that there was a genuine issue of material fact which should have been presented to the jury for decision.
This month the Court of Appeals upheld the summary disposition of a claim brought by the Dubuc family against the Auto Club and others. The Court held that the plaintiffs' evidence was not sufficient to proceed against the insurer, their builder, or the mold eradication specialist, for water damage to their home. The Court held that there was no evidence of conspiracy and insufficient evidence of breach of contract or negligence and that the builder owed the homeowners no fiduciary duty.
In Hunter v. Bank of America, the plaintiff mortgagor sought to hold the bank accountable for improper mortgage foreclosure procedures. Likely citing the considerable fraud and mismanagement that occurred in the making, transferring and enforcement of 2008-era mortgages, Ms. Hunter attempted to sue to recover damages from the bank. The Court of Appeals upheld the granted summary disposition, ruling that Hunter did not have "standing" to argue about the foreclosure procedures because she did not prevent the foreclosure or redeem the property during the six month redemption period.
Auto Owners attempted to avoid paying for damages that resulted after its insured's allegedly defective work caused property damage to a homeowner. The insurer argued that this was purely a case of poor performance by North Arrow Log Homes and filed a declaratory judgment action to deny liability; the insurer claimed that no "occurrence" as defined in the policy had created any duty on its part to pay damages.
The Court rejected this analysis, noting that since the homeowner suffered damage to personal property that was not the insured's work, under the language of the policy the coverage was invoked. Auto Owners could not avoid the obligation it was paid to cover.
In Cronk v. De Jager Construction, the Court of Appeals affirmed the summary disposition of an injury claim brought by a worker who struck his head on a ladder. The worker claimed that his injury resulted from the general contractor's failure to safely maintain the common work area at the construction site. Although the worker cited two MIOSHA regulations to support his claim that the stacked ladders on the site were a readily observable and avoidable danger, the Court ruled that there was insufficient evidence that the ladders were "stored," that they were "unsecure" or that they were a hazard.
Ted Whitby sued Dennis Lee Wright in Calhoun County Circuit Court after he was injured while attempted to help herd loose cattle out of the road and back into their pen. He argued that the farmer who owned the cows was negligent and should be responsible for his injuries. The trial judge held that the farmer owed him "no duty" and granted summary disposition. The Court of Appeals upheld the lower court, ruling that Whitby didn't produce adequate evidence to support his claim that the farmer was negligent in failing to contain the animals. It also held that a statute affording a remedy for property damage to victims of stray beasts did not afford an injury victim a cause of action.
Kevin James was recruited to help remove wooden pallets on the property of the Facility Matrix Croup in Oakland County. The employer agreed to pay him $100.00 "under the table." He was severely injured when the fork lift he had been operating tipped over as an FMG employee negligently attempted to extract it from broken asphalt. When James applied for workers compensation coverage, FMG denied that he was an employee and denied him benefits.
James then filed a civil damages lawsuit against FMG and the at-fault employee; FMG answered by arguing that James could not sue because his exclusive remedy was through workers compensation as an employee. James contended that the employer could not reverse its prior claim of non-employment and rely on James' alleged employee status to summarily dispose of James' lawsuit. The trial court disagreed and dismissed the case. The Court of Appeals affirmed. The judges ruled that James was an "employee" under Michigan's workers comp act and that the employer was not "estopped" to claim the exclusive remedy provision of the workers compensation scheme.
In Rollison v. Kingsbury, a doctor attempted to sue his former partner and the hospital from which he wanted to rent office space. He argued that the hospital's refusal to rent to him constituted "tortious interference with a contract and a business relationship." The Court rejected his claim and reversed the trial judge's refusal to grant summary disposition to the defendants. It concluded that he didn't actually have a contract that was "interfered with;" and that he had no proof of a malicicious intent to eliminate his potential competition with his former partner.
Michigan's courts have recently expanded the "open and obvious" exception to the landowner's duty to maintain a safe business, so that anyone who has lived a winter in Michigan is deemed to be aware of the existence of "black ice." As a result, even though it is invisible, by definition, it is deemed "open and obvious" and the landowner is not held responsible for any injury that results from a negligent failure to take reasonable steps to address the condition.
In the recent Crippen v. 5 Star Lanes, Inc., case, the court went a step further: it held that while the plaintiff was on notice of the icy condition, the defendant--who owed a theoretical duty to inspect its premises for safety problems--was not. The "general awareness" that ice could form in winter conditions--particularly after salting--is enough to put an invited visitor on notice, but not enough to hold a business accountable.
Dennis Cole was beaten in a Wayne County bar. He attempted to sue the owner, arguing that the operator and the other assailants were "agents" for whom the owner should owe responsibility. The Court rejected his claim, holding that the bar operator was an "independent contractor" and therefore the owner owed no duty to protect his victims.
Several people sued the Southfield Lodge, Inc., doing business as the Marvin's Garden Inn, after a shooting occurred during a party at the Inn. One of the shooting victims died as a result of his wounds. The victims argued that the Lodge was negligent in responding to events as the party spiraled out of control. The attorneys for the Lodge's insurer argued that the hotel owed no duty except to call police when employees became aware of a "risk of imminent harm to identifiable [guests]."
The trial judge ruled that the circumstances created a question of fact with regard to whether the Hotel was negligent under Michigan law. The hotel appealed and the Court of Appeals reversed, granting summary disposition of the shooting victims' claims. The Appeals Court judges cited recent rulings by Michigan's insurance-friendly Supreme Court majority holding that a business cannot and need not anticipate "unforeseeable" criminal behavior.
Cottrill hired Sunbay to sell various properties and signed a listing agreement which Cottrill claimed he did not sign and did not believe was fair. The Court held that Cotrilll could not defend a commission action by arguing that he had not read his contract and that he was bound by its terms, whether he fully understood them or not. The Court of Appeals also returned the case to the lower court to assess attorneys' fees against Cottrill, since the listing agreement contained a provision awarding fees.
Matthew Shelson, a truck driver, was hurt while operating a vehicle owned by Sam Forrest and insured by Great West. He was personally insured with Secura. He was forced to sue for PIP benefits when neither insurer would acknowledge responsibility. The trial court ruled that Shelson, whom all parties agreed was an independent contractor, should collect from his own insurer, Secura, because he did not "own" the truck he was operating. Secura argued that because he had been driving the same truck for Forrest for three months, he was now the "owner" of the truck under Michigan law.
The trial judge rejected this argument, as did the Court of Appeals. The latter issued an opinion pointing out that while Shelson had been driving Forrest's truck for more than 30 days, he did not have any indicia of "ownership" or "control" and remained subject to the dictates of Forrest, the owner. Therefore, by statute and pursuant to several prior decisions, Shelson did not "own" the truck he was driving.
In what started out as a three-party unpaid rent case, the Court was forced to decide whether a release executed by two of the parties was binding on a third. The trial judge refused to examine the language of the release and gave it broad interpretation to the disadvantage of the party who was not involved in its execution. On appeal, the Court of Appeals ruled that the Court erred in its broad interpretation of the Release language, but then refused to allow reference to it, since it was not initially raised by the non-signer and was not "newly discovered evidence" since the party was aware of the other parties' settlement.
The Michigan Supreme Court recently overturned a Court of Appeals decision in a case where the parties to a religious "congregational" dispute attempted to involve the courts in its resolution. The parties had engaged in dispute resolution through ecclesiastical procedures. When they were ineffective--or at least unsatisfactory to one of the parties, a suit was filed to determine ownership of property.
The Court of Appeals, relying on a prior Michigan holding, held that the statute of limitations was equitably tolled (extended) while parties engaged in mandatory dispute resolution. The Supreme Court reversed, holding that the mandatory exhaustion of religious dispute resolution remedies did not equitably extend the statute of limitations.
In Watz v. Wal-Mart Stores, the plaintiff appealed the summary disposition of his discrimination claim. He argued that he was a victim of disability harassment based on his cerebral palsy issues. He claimed that his boss "refused to give him earned days off, prevented him from performing his job, and removed personnel from his department." Wal Mart argued that the manager had been coached because of a "difficult management style" and that Watz couldn't prove that the abuse he suffered or the supervisor's conduct were "based on Watz's disability." The trial judge rejected this basis for summary disposition of Watz's claim and Wal-Mart appealed.
The Court of Appeals disagreed and granted summary disposition to Wal-Mart. The judges held that since the manager was "difficult" and other employees had complained, there was no evidence that Watz was targeted because of his disability.
Medical provider's PIP claim is dismissed because insured's claim resulted in previous ruling of "full payment."
Court summarily dismisses apartment renter's claim against landlord and snow plowing company: "no duty"
Loose animals, stray beasts, etc.
Negligence theories that are not "routine"

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