Case Name: ELBY v. LIVERNOIS ENGINEERING CO.
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1971-11-26
Citations: 37 Mich. App. 252
Docket Number: Docket No. 10551
Parties: ELBY v. LIVERNOIS ENGINEERING CO.
Judges: Before: Lesinski, C. J., and V. J. Brennan and O’Hara, JJ.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 37
Pages: 252–254

Head Matter:
ELBY v. LIVERNOIS ENGINEERING CO.
1. Administrative Law — Exhaustion of Remedies — Eutile Act.
Exhaustion of administrative remedies before commencing legal proceedings is not required where to seek relief in the administrative channel would be a futile act.
2. Administrative Law — Exhaustion of Remedies — Profit Sharing Plan — Advisory Board — Determination of Eligibility.
Plaintiff employees were not required, prior to commencing legal proceedings to determine their eligibility under their employer’s profit sharing plan, to seek a determination of their eligibility from an advisory board pursuant to the profit sharing trust agreement where seeking a determination from that board would have been a futile act since the employer had denied their eligibility and the advisory board was a mere creature of the employer.
3. Contracts — Ambiguity—Construction Against Drafter.
The terms of a contract which are ambiguous will be construed against the drafter of that contract.
References for Points in Headnotes
[1, 2] 2 Am Jur 2d, Administrative Law § 595 et seq.
[3] 17 Am Jur 2d, Contracts § 240 et seq.
Appeal from Wayne, George T. Martin, J.
Submitted Division 1 October 7, 1971, at Detroit.
(Docket No. 10551.)
Decided November 26, 1971.
Complaint by Dale Elby, for himself and as representative of all persons having an interest in Livernois Engineering Company Profit Sharing Trust, against Livernois Engineering Company for a determination of eligibility under the trust. Sum mary judgment for plaintiff. Defendant appeals.
Affirmed.
Rothe, Marston, Masey, Sachs, O’Connell, Nunn & Freíd, P. C., for plaintiff.
Oglesby é Oglesby (MacLean & Proppe, of counsel), for defendant.
Before: Lesinski, C. J., and V. J. Brennan and O’Hara, JJ.
Former Supreme Court Justice, sitting on the Court of Appeals by assignment pursuant to Const 1963, art 6, § 23 as amended in 1968.

Opinion:
Per Curiam.
This is an appeal from a summary judgment for plaintiff; the case was tried on an agreed statement of facts. It involves the status of 16 of defendant's former employees under a profit-sharing trust agreement. The employees involved were employed hy defendant for a portion of 1968; the question is whether or not they are entitled to benefits under the trust agreement for the year 1968. The trial court ruled that they were so entitled; defendant appeals.
The trial court ruled that the agreement did not require plaintiff to seek a determination of his status from the "advisory hoard" established by the agreement and therefore defendant's argument that plaintiff failed to exhaust his administrative remedies was without merit. We agree that that argument is without merit, hut for a different reason. The trust agreement did provide that the advisory committee would determine "all doubtful cases of eligibility to participate in this Plan and Trust". However, defendant had refused participation under the trust to plaintiff for the year in question. The advisory board was defendant's creature and seeking a deter- <. mination from that board would have been futile. Plaintiff was therefore not required to seek such a ruling before commencing legal proceedings. Welfare Employees Union v. Civil Service Commission (1970), 28 Mich App 343.
The remaining arguments in this case revolve around the trial court's reading of the contract and interpretation thereof. We agree with his rulings, and affirm them, but add an additional basis. The best that can be said of defendant's arguments is that they make out a case for the ambiguity of the contract. In such circumstances the ambiguity will be construed against the drafter.
Affirmed.
The Trust Agreement, Article VI, paragraph 1 provides:
"The Board of Directors of Livernois Engineering Co. shall appoint a committee of not less than three to be known as the 'Advisory Committee' (hereinafter sometimes referred to as the 'Committee') who shall serve at the pleasure of the board of said company. Vacancies in the Committee arising by resignation, death, removal or otherwise, shall be filled by the board."