Court Opinion

ID: 9722011
Source: CourtListenerOpinion
Date Created: 2023-08-26 09:14:31.580583+00
Date Added: 2024-06-11T18:24:30.058641
License: Public Domain

Mallett, J.
I
The present case involves the question whether a landlord-tenant legal relationship may be recognized pursuant to a contract of employment where use and occupancy of an apartment are the sole and full compensation for the services rendered. We answer in the affirmative and reverse and remand the case for further proceedings consistent with this opinion.
II
Plaintiff Ellsworth Grant occupied a two-bedroom apartment in defendant Detroit Association of Women’s Clubs (dawc) in the City of Detroit. Use and occupancy of the apartment, as well as basic utilities, were provided by dawc pursuant to an employment contract in exchange for plaintiff’s services as a full-time caretaker. The contract provided that the use of the apartment and payment for the utilities were the "sole and full compensation for [the] agreement.”1 The contract further stated that dawc could summarily dismiss plaintiff for cause, or terminate the agree*600ment without cause at any time upon thirty days’ written notice.2
In a letter dated March 1, 1989, the president of dawc terminated plaintiff’s employment. Plaintiff testified that he received the letter on March 8, 1989. He responded on March 10, questioning the reasons for the termination. On March 18, the president replied, indicating "unsatisfactory” service as the reason for termination.
Without further notice, the president changed the locks on the apartment on April 5, 1989. Plaintiff’s personal possessions, including cash, kitchen, items, and a camera, remained inside the apartment.
Plaintiff brought an action in Wayne Circuit Court, seeking injunctive relief and damages, alleging that the change of locks unlawfully interfered with his possessory interest in the apartment. At a show cause hearing, the circuit court ruled that no tenancy existed and that plaintiff was a trespasser. The matter was held in abeyance pending commencement of summary eviction proceedings in the district court.
Dawc promptly instituted such proceedings, which were dismissed by the district court because it found that Grant was not a tenant, and, even if he was a tenant, defendant properly had given thirty days’ notice. The Wayne Circuit Court affirmed, holding that no tenancy existed. The Court of Appeals denied Grant’s application for leave to appeal.
The original circuit court action then progressed *601to mediation.3 Thereafter, the parties filed cross motions for summary disposition, and the court granted dawc’s motion and dismissed the action.
The Court of Appeals affirmed in an unpublished per curiam opinion, holding that if an employee occupies the premises of an employer’s business and does not pay rent, then a landlord-tenant relationship does not exist. Accordingly, it declined to address whether dawc’s failure to comply with the thirty-day notice requirement constituted unlawful interference with plaintiff’s possessory rights. Plaintiff’s application for leave to appeal was granted by this Court. 441 Mich 880 (1992).
III
Defendant contends that it is an established rule that an employee who occupies premises incidental to his employment is not a tenant, and that the employee loses the right to occupy the premises once the employment is terminated. In Alpine Twp School Dist No 11 v Batsche, 106 Mich 330, 333; 64 NW 196 (1895), a teacher occupying the upper level of a schoolhouse remained in possession of the premises with the school district’s permission after the school term ended. This Court held that an employment, and not a landlord-tenant, relationship existed between the parties because there were no terms to the agreement, no rent was reserved, and the purpose of the occupancy was to enable the employee to better serve the employer. However, the Court further held that a tenancy by sufferance may result where the employer acquiesces in the occupancy, regardless of the parties’ original relationship. Id. at 334.
The present case is distinguishable. The court in *602Batsche found that the plaintiff was a tenant by sufferance, because he was permitted to remain on the premises without having to perform his employment duties. Thus, no "housing in exchange for services” arrangement continued to exist. At no time in the present case, however, did defendant dawc acquiesce in Grant’s possession of the apartment. Furthermore, the employment contract in the present case expressly provided that use and occupancy of the premises were "the sole and full compensation” for the plaintiff’s services, the inference being that the plaintiff was paying for the use of the apartment by providing his services as caretaker for defendant dawc.
In Lane v Au Sable Electric Co, 181 Mich 26, 31; 147 NW 546 (1914), the chief operator of the defendant’s substation and his family occupied a dwelling house as part of his compensation for employment. When the plaintiff went on strike, the defendant notified him to vacate the premises, but he refused. A short time later, the defendant’s representatives moved all of the plaintiff’s furniture onto the street. This Court held that a landlord-tenant relationship did not exist because the plaintiff was in possession of the defendant’s property by virtue of his employment. When the plaintiff chose to strike, his entitlement to the property ceased to exist.
However, plaintiff asserts, and this Court notes, that contrary authority exists in our state and other jurisdictions. In Shaw v Hill, 79 Mich 86, 89; 44 NW 422 (1889), a third party agreed to keep trespassers off the defendant’s land in exchange for occupancy of the land. This Court made clear that
[r]ent may be reserved in services as well as in money; and if [the employee] agreed to render *603such services, for the use of the land, he occupied the position of tenant at will to [the employer]. '
Plaintiff also points to Munson v Menominee Co, 371 Mich 504; 124 NW2d 246 (1963), which offers insight through its treatment of the term "rent.” There, the plaintiff was employed with the department of social welfare within the county. While the plaintiff attempted to adjust a window shade in her office, the shade fell from its bracket and struck the plaintiff on the head. The defendant claimed governmental immunity, and the issue arose whether the defendant, in furnishing the office space to the state, acted in a proprietary capacity or was engaged in the exercise of a governmental function. In deciding that it was a proprietary function, this Court concluded that rent may be provided in services as well as money, and that the amount of consideration for the lease is not controlling.
The term "rent” is defined in 32 Am Jur, Landlord and Tenant, § 428, p 347 as follows:
"The word 'rent’ derives from the Latin word 'reditus.’ In ordinary use, it means the return made by one who occupies real estate under an express or implied contract with the owner, for the occupation of the premises, and is defined broadly as the compensation in money, provisions, chattels,’ or services, paid or given in exchange for the use and occupancy of real estate.” . . .
Likewise, in 52 CJS, Landlord and Tenant, § 462, p 201, it is said:
" 'Rent’ as the term is employed in the law of landlord and tenant, may be defined as the return, whether of money, service, or specific property, which the tenant makes to the landlord as compensation for the use of the demised premises.”[4]
*604Plaintiff notes that the Court of Appeals in the instant case quickly dismissed two instructive federal cases. In Folgueras v Hassle, 331 F Supp 615, 621 (WD Mich, 1971), the defendant owned and operated agriculture labor camps at which housing was a portion of the migrant workers’ compensation for labor.5 After the plaintiffs were forcibly removed from the premises, they sought a declaration of their right of access to the camps. The court concluded that the owner of the migrant camp could not lawfully bar access by visitors or representatives of assistance groups seeking entrance to the camps. In so doing, the court concluded that the migrants living in the camp were tenants, and that their tenancy entitled them, their guests, and representatives of assistance organizations to "full rights of ingress and egress to and from their dwellings.” Id. at 624. The court noted that a landlord-tenant relationship was present.
Thus, all the elements of the typical landlord-tenant relationship are present. The migrant pays for the dwelling he occupies; the landlord binds himself to provide a dwelling of a fixed quality; [and] the migrant occupies the dwelling exclusive of the landlord for an agreed upon term — the length of his employment. [Id.]
In Rodriguez v Berrybrook Farms, Inc, 672 F Supp 1009, 1020 (WD Mich, 1987), the plaintiffs argued that migrant camp owners and workers enjoyed a landlord-tenant relationship even though the workers did not pay cash for their housing. Relying on Folgueras, the court agreed and concluded that "the rental relationship arises because agri*605cultural workers in essence 'pay’ rent for the 'free housing’ when they exchange their labor for it.”
These cases establish the importance of examining whether the essential characteristics of a landlord-tenant relationship are present. The Court of Appeals has stated that a lease, and hence a landlord-tenant relationship, is created when the owner of an estate conveys to another a portion of his interest for a term less than his own for valuable consideration, thereby granting the lessee use and enjoyment of . the premises during the period stipulated. Dep’t of Natural Resources v Bd of Trustees of Westminster Church of Detroit, 114 Mich App 99; 318 NW2d 830 (1982). See also 51C CJS, Landlord and Tenant, § 1, p 32.6
In addition to the essential characteristics of the landlord-tenant relationship, the purpose of the occupancy has been deemed a crucial point of inquiry.
The relation of landlord and tenant is clearly distinguishable from that of master and servant, the principal distinction being in the possession by the tenant of an estate in the demised premises, which is lacking in the case of a servant. The question depends on the nature of the holding, whether it is exclusive and independent of, and in no way connected with, the service, or whether it is so connected, or is necessary for its performance.
*606[TJhere is no inconsistency between the relation of landlord and tenant and that of master and servant, and, where it appears that the occupation of the master’s premises is not treated by the parties themselves as a mere incident of the service, and the master has parted with the control of the premises, it may be regarded in law as an occupation as tenant, even though the rental is satisfied in whole or in part by the services rendered. Whether the occupancy is, in a given case, that of a tenant or of a servant or employee depends on the language of the agreement and the attendant circumstances.[7]
Plaintiff makes it clear that the essential characteristics of a landlord-tenant relationship are present. Plaintiff agreed to provide his services as caretaker in exchange for use and occupancy of the apartment at defendant’s clubhouse; plaintiff’s consideration for the úse and occupancy of the apartment was his labor; defendant transferred possession and control of the premises to plaintiff; plaintiff occupied the apartment exclusive of defendant; and the length of the tenancy was for an agreed-upon duration — the length of the employment relationship. That the agreement is labeled a "Contract of Employment,” as noted by the dissent,7
8 is not probative of the nature of the relationship between the parties.
It is also apparent that plaintiff’s occupancy of the premises was essentially independent of the services he rendered; it cannot be said that plaintiff’s occupancy was essential to his position as caretaker. Living on the premises was unnecessary for fulfillment of his caretaking duties, including cleaning the building as needed, handling reservations for the use of the clubhouse, setting *607up equipment when the clubhouse was occasionally rented, collecting rent and other charges, and snow removal. Although living on the premises may have made it more "convenient”9 for plaintiff to fulfill his duties, his residence did not guarantee compliance with his contractual obligations. That plaintiff’s presence on the property gave defendant the additional benefit of on-site, twenty-four hour security was an incidental outgrowth of the employment relationship; providing security to the premises was not a part of the employment contract. While it is true that plaintiff’s occupancy provided some advantages to one or both parties to the rent as payment for services relationship, we do not conclude that this fact detracts from the tenancy.
Furthermore, the occupancy was not treated by the parties as a marginal consequence of employment. According to the terms of the employment contract, use and occupancy of the apartment were "sole and full compensation” for the services he provided. As stated previously, such an arrangement implies that payment for the occupancy of the apartment was in the form of the caretaking services provided by the plaintiff.
Finally, public policy buttresses our decision. The Legislature enacted MCL 600.2918; MSA 27A.2918,10 commonly referred to as the "antilock*608out law” in an effort to prevent landlords’ self-help in executing evictions. The Legislature sought to reduce the number of violent confrontations occurring as a consequence of landlords entering onto the premises while tenants believed that they were rightfully in possession. There is no doubt that such a policy should be extended to cover situations in which housing is exchanged for employment. The type of consideration given for the housing has no bearing on the nature of this potentially volatile relationship. Further, the fact that a landlord wears two hats, landlord and employer, does not excuse the landlord from compliance both with housing and employment laws. The landlord’s dual status does not create an automatic exception to the applicable laws.
IV
We hold that where the essential characteristics of a landlord-tenant relationship are present, an employment contract may create a tenancy. The lower court improperly granted defendant’s motion for summary disposition. We remand this case to the circuit court for full consideration of plaintiff’s claim that defendant’s failure to comply with the thirty-day notice requirement unlawfully interfered with plaintiff’s possessory interest pursuant to MCL 600.2918; MSA 27A.2918.
Reversed and remanded.
*609Cavanagh, C.J., and Levin, Brickley, and Boyle, JJ., concurred with Mallett, J.

 For all services rendered under this agreement the Employer shall provide a two bedroom apartment for the use and occupancy of the Employee, all utilities for said apartment, except telephone service, shall be furnished/provided by the Employer. This shall be the sole and full compensation for this agreement.

 Employer may, with just cause, dismiss Employee summarily, and without cause may terminate this agreement, at any time, upon thirty (30) days written notice. Employee may terminate this agreement upon thirty (30) days written notice to the Employer. In such an event the Employee shall continue to render her [sic] services up to the date of termination.

 The mediation panel awarded plaintiff $12,000, which he accepted and dawc rejected.

 Munson, supra at 512-513.

 The agreement between the owner and the workers was set forth in a "Clearance Order,” which stated that housing was provided and "rent [was] free.” Folgueras, supra at 624.

 It is generally held that, in order that the relation of landlord and tenant may exist, there must be present all the necessary elements of the relation, which include permission or consent on the part of the landlord to occupancy by the tenant, subordination of the landlord’s title and rights on the part of the tenant, a reversion in the landlord, the creation of an estate in the tenant, the transfer of possession and control of the premises to him, and, generally speaking, a contract, either express or implied, between the parties.

 51C CJS, Landlord and Tenant, § 6(2), pp 39-40. See also Batsche, supra at 333-334.

 Post at 611.

 Post at 612.

 MCL 600.2918; MSA 27A.2918 provides in pertinent part:
(1) Any person who is ejected or put out of any lands or tenements in a forcible and unlawful manner, or being out is afterwards held and kept out, by force, if he prevails, is entitled to recover 3 times the amount of his actual damages or $200.00, whichever is greater, in addition to recovering possession.
(2) Any tenant in possession of premises whose possessory interest has been unlawfully interfered with by the owner, lessor, licensor, or their agents shall be entitled to recover the amount of his actual damages or $200.00, whichever is greater, *608for each occurrence and, where possession has been lost, to recover possession. Unlawful interference with a possessory interest shall include:
(a) The use of force or threat of force.
(b) The removal, retention, or destruction of personal property of the possessor.
(c) A change, alteration, or addition to the locks or other security devices on the property without forthwith providing keys or other unlocking devices to the person in possession.