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Volume XXIV, No. 15, September 13, 2012      

 

From the Law Offices of Garan Lucow Miller, P.C.

From the Co-Editors

James L. Borin & Simeon R. Orlowski

 

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Michigan Supreme Court limits the tort duties owed by workers providing specific services under contract.

 

Contributor: David M. Shafer

 

In an majority (4-3) opinion written by Justice Mary Beth Kelly in an interlocutory appeal, the Michigan Supreme Court reversed the Court of Appeals and interpreted an appliance installer’s duty narrowly, to extend to doing the job the installer contracted to perform, but not extending beyond that to check the condition of nearby gas pipes.

More specifically, the majority opinion held that the plaintiff did not state a claim in tort for negligence because the defendant appliance installer did not have a legal duty to take action concerning, or to warn about, the danger of an uncapped gas line located behind the newly installed appliances.  Instead, the installer had a limited contractual duty to simply install the appliances, which duty did not extend to create any obligation to inspect or cap or do anything about a nearby uncapped gas line.

The opinion is Hill v Sears, Roebuck and Co, ___ Mich ___ (2012) WL 3537812 (August 16, 2012), and a copy of it may be obtained at

http://coa.courts.mi.gov/documents/opinions/final/sct/20120816_s143329_128_hill-op.pdf 

The plaintiff’s house exploded after she mistakenly released gas from an uncapped gas line.  Her daughter ignited the released gas when she attempted to light a candle.  The uncapped gas line was “hidden” behind an electric dryer that had been installed four years earlier by the defendant installer.  Both the plaintiff and her daughter had smelled gas in the house earlier in the day, but the plaintiff did not call anyone to do anything about it.

After the explosion, the plaintiff sued the installer on the basis that he should have done something about the uncapped gas line or warned about it before having installed the electric dryer, which concealed the uncapped gas line.  But four of the seven justices of the Supreme Court decided that the installer’s duty did not extend that far.  Rather, the installer’s duty was a limited contractual duty that encompassed simply installing appliances, which limited duty the installer had satisfied.  According to the majority opinion, “[t]he contract did not obligate [the installer] to inspect, cap, or in any manner touch the gas line.”  Moreover, the majority opinion observed that the plaintiff knew about the uncapped gas line before the electric dryer was installed, and added that “we are not aware of a single Michigan case that imposes a legally cognizable duty when a competent adult chooses to remain ignorant about a condition within his or her complete control.”  According to the majority opinion, “it is difficult to envision what social benefit would result were we to recognize plaintiffs’ claim because the result would be to absolve homeowners from any duty to protect themselves from hazards within their own homes.”  (Emphasis in original.)

Justice Mary Beth Kelly’s majority opinion was adopted by Chief Justice Robert Young and by Justices Stephen Markman and Brian Zahra.  The dissent was written by Justice Marilyn Kelly and was adopted by Justices Michael Cavanagh and Diane Hathaway.

Plaintiffs sometimes try to extend the duties owed to them by trades people who work on or in their homes.  This new Hill majority opinion of the Supreme Court might go a long way in limiting the extension of those duties beyond those assumed in the worker’s contract.

 

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MINI-TORT CAP INCREASED TO $1,000

CONTRIBUTOR: SIMEON R. ORLOWSKI

Beginning with accidents occurring on October 1, 2012, the mini-tort recovery cap is $1,000.   That is, beginning October 1, 2012, a person involved in a motor vehicle accident can recover up to $1,000 for damages done to a motor vehicle to the extent that the damages are not covered by insurance.

The other significant change in the law is that a person operating a motor vehicle  without the compulsory insurance required by MCLA 500.3101 will not be able to recover mini-tort damages.  Presently, a person operating a motor vehicle without the basic required insurance can still recover mini-tort damages.   Effective October 1, 2012, that will no longer be true.  However, an owner of an insured motor vehicle who has not purchased optional collision coverage can still collect mini-tort damages.

Note: Mini-tort coverage is optional.  Therefore, existing policies are not automatically amended to increase mini-tort coverage limits from $500 to $1,000.

Hundreds of people attended the firm’s No-Fault Update on August 30, 2012.  Mini-tort materials were provided to the attendees that day.  Those materials follow this brief article.  You will see the old law with amendments; three notes regarding the new law; and the amended MCLA 500.3135, effective October 1, 2012.

Finally, you will find the mini-tort quiz that was given on August 30, 2012.  There are questions and answers for three hypothetical accidents which occur on September 30, 2012, and three hypothetical accidents which occur the following day, October 1, 2012, when the new law takes effect.  Good Luck!

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THE INSURANCE  CODE OF 1956 (EXCERPT)

Act 218 of 1956

….500 .3135.amended  THIS AMENDED SECTION IS EFFECTIV E OCTOBER !, 2012 •••••

500.3135.amended   Tort   liability  for   noneconomic   loss;   “serious  impairment  of   body function” defined

Sec 3135. (I) A  person remains subject  to  tort liability for noneconomic loss caused  by  his  or  her ownership, maintenance, or use of a motor  vehicle only if the injured person has suffered  death,  serious impairment  of body function, or permanent serious disfigurement.

(2) For a cause of action for damages pursuant to subsection (I) filed on or after July 26, 1996, all of the following apply:

(a) The  issues of  whether the  injured  person  has  suffered  serious impaim1ent of  body  function  or pem1anent serious disfigurement are questions of law for the court if the court finds either of the following:
(i) There is no factual dispute concerning the nature and extent of the persons injuries.

(il) There is a factual dispute concerning the nature and extent of the persons injuries, but the dispute is not material to the determination whether the person has suffered a serious impairment of body  function  or permanent serious disfiguration.  However, for a closed-head injury, a question of fact for the jury is created if a licensed allopathic or osteopathic physician who regularly diagnoses or treats closed-head injuries testifies under oath that there may be a serious neurological injury.

(b) Damages shall be assessed on the basis of comparative fault, except that damages shall not be assessed in favor of a party who is more than 50% at fault.

(c) Damages shall not be assessed in favor of a party who was operating his or her own vehicle at the time the injury occurred and did not have in effect for that motor vehicle the security required by section 3101 at the time the injury occurred

3) 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 section 310I 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 or her act or omission, the person does not cause or suffer that harm  intentionally if he or she acts or refrains from acting for the purpose of averting injury  to any person, including himself or herself, or for the purpose of averting damage to tangible property.

(b) Damages for noneconomic loss as provided and limited in subsections (I) and (2).

(c) Damages for allowable expenses work loss, and survivors 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 or her liability by the amount of taxes that would have been payable on account of income the injured person would have received if he or she had not been injured.

(d) Damages for economic loss by a nonresident in excess of the personal protection insurance benefits provided under section 3163(4). Damages under this subdivision are not recoverable to the extent that benefits covering the same loss are available from other sources, regardless of the nature or number of benefit sources available and regardless of the nature or form of the benefits.

(e) Damages up to $1,000.00  to a motor  vehicle,  to the extent that the damages are not covered  by insurance. An action for damages under this subdivision shall be conducted as provided in subsection (4).

(4) All of the following apply to an action for damages under subsection (3)(e):

(a) Damages shall be assessed on the basis of comparative fault, except that damages shall not be assessed in favor of a party who is more than 50% at fault.

(b) Liability is not a component of residual liability, as prescribed in section 3131, for which maintenance of security is required by this act.

(c) The action shall be commenced, whenever legally possible, in the small claims division of the district court or the municipal court. If the defendant or plaintiff removes the action to a higher court and does not prevail, the judge may assess costs.

{d) A decision of the court is not res judicata in any proceeding to determine any other liability arising from the same circumstances that gave rise to the action.

(e) Damages shall not be assessed if the damaged motor vehicle was being operated at the time of the damage without the security required by section 31 0 I.

(5) As  used in this section, “serious  impairment of  body function” means an objectively  manifested impainnent of an important body function that affects the persons general ability to lead his or her normal life.

Rendered Thursday

 June 21, 2012   

                                                 Page 1

Mchigan Compiled Laws Complete Through PA 164 and includes 166-172 & 174 of 2012

Courtesy of http://www.legislature.mi.gov/Legislative Council, State of Michigan


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MINI-TORT AMENDMENT

MCL 500.3135(3) AMENDED BY 2012 PA 5362

OLD LAW WITH AMENDMENTS

Sec. 3135.  (1) A person remains subject to tort liability for noneconomic loss caused by his or her ownership, maintenance, or use of a motor vehicle only if the injured person has suffered death, serious impairment of body function, or permanent serious disfigurement.

(3) 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 section 3101 was in effect is abolished except as to:

(e) Damages up to $500.00 $1,000.00 to A motor vehicles VEHICLE, to the extent that the damages are not covered by insurance.  An action for damages pursuant to UNDER this subdivision shall be conducted AS PROVIDED in compliance with subsection (4).

(4) In ALL OF THE FOLLOWING APPLY TO an action for damages pursuant to UNDER subsection (3)(e):

(a) Damages shall be assessed on the basis of comparative fault, except that damages shall not be assessed in favor of a party who is more than 50% at fault.

(B) Liability shall IS not be a component of residual liability, as prescribed in section 3131, for which maintenance of security is required by this act.

(C) (5) Actions under subsection (3)(c) THE ACTION shall be commenced, whenever legally possible, in the small claims division of the district court or the municipal court.  If the defendant or plaintiff removes the action to a higher court and does not prevail, the judge may assess costs.

(D) (6) A decision of a THE court made pursuant to subsection (3)(e) is not res judicata in any proceeding to determine any other liability arising from the same circumstances as THAT gave rise to the action.  Brought pursuant to subsection (3)(e)

(E) DAMAGES SHALL NOT BE ASSESSED IF THE DAMAGED MOTOR VEHICLE WAS BEING OPERATED AT THE TIME OF THE DAMAGE WITHOUT THE SECURITY REQUIRED BY SECTION 3101.

* * * * * * * * * * * * * * * * * * * * * *

1. Effective for accidents occurring on and after October  1, 2012.

2. Mini-tort insurance is optional and, therefore, existing policies are not automatically amended to the higher limits.

3. Uninsured motor vehicle is defined as a motor vehicle which does not have 3101 – required coverages.

An owner of an insured motor vehicle which does not have optional collision coverage can collect mini-tort.

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MINI TORT QUIZ

ACCIDENT ON SEPTEMBER 30, 2012

I.

          A B

% at Fault

50% 50%

No Fault Insurance

Yes Yes

Collision Damage

$1,000 $500

Mini-Tort Coverage

$500 $500

 

ANSWER

 

* A’s insurer pays B $250.

* B’s insurer pays A $500.

II.

          A B

% at Fault

50% 50%

No Fault Insurance

Yes No

Collision Damage

$2,000 $1,000

Mini-Tort Coverage

$500 None

ANSWER

 

* A’s insurer pays B $500.

* A gets judgment against B for $1,000.

III.

          A B

% at Fault

30% 70%

No Fault Insurance

Yes yes

Collision Damage

$1,500 $1,500

Mini-Tort Coverage None $500

ANSWER

*

B gets nothing. He is more than 50% at fault.

* B’s insurer pays $500 to A.

* A cannot sue B for balance of collision damages – B has tort immunity

ACCIDENT ON OCTOBER 1, 2012

I.

          A B

% at Fault

50% 50%

No Fault Insurance

Yes Yes

Collision Damage

$2,000 $2,000

Mini-Tort Coverage

$500 $1,000

 

ANSWER

 

* B’s insurer pays $1,000 to A.

* A’s insurer pays $500 to B.

* B gets judgment for $500 against A.

II.

          A B

% at Fault

25% 75%

No Fault Insurance

Yes No

Collision Damage

$2,000 $1,000

Mini-Tort Coverage

$1,000 None

ANSWER

 

*

A gets judgment against B for $1,500.

* B gets nothing because his car is uninsured and he is more than 50% at fault.

III.

          A B

% at Fault

50% 50%

No Fault Insurance

Yes Yes

Collision Damage

$5,000 $5,000

Mini-Tort Coverage

$1,000 $500

ANSWER

* A gets $500 from B’s insurer.  Also gets judgment for $500 in mini-tort action.

* A has unsatisfied property damage claim of $1,500 which he cannot pursue against B who enjoys tort immunity.

* B gets $1,000 from A’s insurer.

* B has unsatisfied property damage claim of $1,500 which he cannot pursue against A who enjoys tort immunity.