Predicting the Future of Justice

Okay, so maybe the title of this post is a little over-reaching.  Still, if you define justice as whatever the Michigan Supreme Court decides, that’s exactly what I’m going to do here — predict the results of the first eight cases the Court heard in the 2009-2010 term. 

Let me be very clear about this next part — I am not involved in any of these cases.  I did not work on them, I have no interest in their outcome, and I have done precious little research about the issues.  I have no sources in the MSC chambers.  Quite simply, these predictions result from 27 years of studying law, practicing law, and observing courts.

In other words, pure guesswork.

Actually, I’m doing this to test a theory about our current MSC.  Since the court went from majority conservative to majority liberal (or 3 conservatives to 3 liberals plus one wild card who hates the conservatives), the court has demonstrated its willingness to engage in obvious politics-based decision-making.  So, without knowing too much about the cases being heard, we should be able to predict results based solely on ideology.

Let’s give it a try.

1.  Adair v State of Michigan.  The plaintiffs, a bunch of school districts, sued the state because the state requires school districts to compile certain data and to send in reports about it.  The school districts argued that this costs money, and the state failed to appropriate funds for the reporting, in violation of Michigan’s so-called Headlee Amendment.  The state pointed out that it had increased general appropriations for the school districts and that they therefore had the money to spend on the increased reporting. The school districts won in the lower court.

Prediction:  The plaintiffs win again.  Liberals hate the Headlee Amendment because it imposes fiscal discipline, but they will use it when necessary to increase money for school districts because that ultimately helps teachers unions, whom liberals love more than anything.

2.   Pierron v Pierron.  Parents get divorced, but both live in Grosse Pointe Woods, so the kids go to school there.  Seven years later, Mother decides to move to Howell, taking kids with her.  Father objects.  Trial court rules for father, but Court of Appeals vacates the trial court’s ruling and remands for reevaluation.  A question here about the burden of proof.  Father appeals to MSC.  The test is what is in the best interests of the children.

Prediction:  A close one.  Still, mother wins out because she is the primary caregiver and men are stupid.

3.  People v Wilder.  Defendant is charged with first degree home invasion.  After a trial, he was convicted of third degree home invasion.  Defendant argued that third degree HI is not a lesser included offense with first degree HI and, therefore, it had to be charged separately.  The Court of Appeals agreed and vacated the conviction.  Prosecutor appeals.

Prediction:  Liberals love these kinds of loopholes.  Defendant wins again.

4.  Davis v Forest River, Inc.  This is a products liability case involving a recreational vehicle the plaintiff bought from a dealer.  He sued the manufacturer, seeking to return the vehicle and get a refund.  The manufacturer order that undoing the sale (in legal terms, a rescission) was not proper since the manufacturer did not have a contract with the plaintiff-buyer.  The Court of Appeals rejected this argument, finding that rescission was possible even though the plaintiff and the manufacturer were not in “privity of contract.”  The manufacturer appeals.

Prediction:  An individual against a big corporation plus the chance to extend consumer protections into an area where it never existed?  That’s too much for liberals to resist — the plaintiff wins again.

5.  Insurance Institute of Michigan v Commissioner.  The insurance commissioner promulgated a rule that prohibits insurance companies from using consumer credit report scores to establish insurance premiums.  A group of insurance companies and their customers sued, and the trial court declared the rule illegal, invalid, and unenforceable.  The commissioner appealed, and the Court of Appeals vacated the trial court’s ruling.

Prediction:  Another easy one.  Using credit scores sounds much  too accurate and is, therefore, incompatible with the kind of social engineering liberals love.  If we look at people individually, how will we ever see them as members of a protected class?  The plaintiffs lose this one, although the court may simply say that the plaintiffs did not exhaust their administrative remedies before the commissioner (yes, that’s correct, the plaintiffs would have to go through all kinds of proceedings with the defendant before suing.)

6.  First National Bank of Chicago v Department of Treasury.  The Michigan Department of Treasury foreclosed on a tax lien.  BankBoston held a mortgage on the property and was entitled to notice of the sale, but BankBoston had merged with Fleet National Bank and changed its name to FNB.  Notice of the foreclosure sale was sent to FNB in Rhode Island instead of to BankBoston in, well, Boston, which was the address of record in the mortgage documents.  The plaintiff, BankBoston’s trustee, sued, claiming its mortgage interest was foreclosed without due process.  The trial court ruled in favor of the plaintiff, and so did the Court of Appeals.

Prediction:  A close one.  Liberals hate banks, but they also hate foreclosures, and they wouldn’t mind throwing up a few more foreclosure roadblocks.  This case helps them do it, and they can actually follow the law by ruling in the plaintiff’s favor.  The plaintiff wins.

7.  Department of Agriculture v Appletree Marketing LLC.  This is a beauty.  The Michigan Apple Committee provides marketing and research programs for Michigan apple growers.  The Committee is required by law, and apple distributors must collect payments for the apples they sell and pay them over to the Committee.  Appletree Marketing is a distributor and collected payments for 2004 and 2005, but did not pay them to the Committee.  The Department of Agriculture sued for the back payments under the law, and also sought treble (legalese for triple) damages under a common law claim of conversion.  The trial court and the Court of Appeals held in favor of the Department on the statute, but said the remedies under the statute were exclusive, so it could not bring a common law conversion claim.  The Department appealed, because it wants treble damages.

Prediction:  The liberals have been strongly criticized (and rightfully so) for ignoring statutory language to impose their own views of what the law should be.  Here is their chance to rule in a way that allows them to claim that they follow statutes, particularly where the plaintiff is made whole anyway and there are no pet interests to be appeased.  The defendant wins.

8.  People v Feezel.  The defendant, who was intoxicated and had been smoking marijuana, was driving along when he struck and killed a pedestrian.  The victim, also intoxicated, was walking in the middle of a dark road during a rainstorm.  Feezel was convicted of numerous charges, and the Court of Appeals affirmed.  The primary issue before the MSC is whether evidence of the victim’s intoxication — excluded by the trial court — should have been admitted.

Prediction:  Judges can’t be seen as soft on drunk drivers.  This case gives the liberals a chance to be seen as tough on crime without going out on a limb or making any difficult choices.  The conviction is affirmed.

That’s it for now — keep checking back to see how I did.

This ACORN Is Up A Tree, Part 1

In what will later be seen as one of the most stupid legal maneuvers ever attempted, ACORN, Tonja Thompson, and Shera Williams sued James O’Keefe, Hannah Giles, and Breitbart.com in the Maryland Circuit Court for Baltimore City.    The suit, filed September 23, alleges that O’Keefe and Giles “intercepted” communications from Thompson and Williams and seeks over $3 million in damages.

In case you’ve been in an isolation booth the last two weeks, O’Keefe and Giles are two young, conservative activists who have almost singlehandedly (doublehandedly?) devastated ACORN, the Association of Community Organizations for Reform Now.  Posing as a pimp and a prostitute, O’Keefe and Giles approached a number of ACORN offices seeking help to (a) set up a brothel, (b) bring in underaged girls from El Salvador to work as prostitutes, (c) avoid any tax liabilities, and (d) use the proceeds from the business to finance O’Keefe’s run for Congress. 

Beginning with Baltimore and continuing in other cities, including New York and San Diego, ACORN employees fell all over themselves advising the faux entrepreneurs on how to accomplish their patently illegal objectives.  All was recorded on hidden video, and the recordings were then posted on YouTube, Breitbart’s sister website, biggovernment.com, and aired frequently on the Fox News Channel.  Here’s a sample:

Naturally, ACORN fired the two employees involved, as you would expect.  Then came the lawsuit, and lo and behold, the same attorneys representing ACORN are also representing the fired employees!  The attorneys must not be familiar with Rule 1.7 of the Maryland Rules of Professional Conduct, which says that “a lawyer shall not represent a client if the representation involves a conflict of interest.  A conflict of interest arises if:  (1) the representation of one client will be directly adverse to another client; or (2) there is a significant risk that the representation of one or more of the clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.”

So, ACORN fires the workers, then hires lawyers to represent both ACORN and the workers in a lawsuit against the filmmakers.  Here’s what the lawsuit says about this:

“22.  As a direct and proximate result of the actions of defendants, Ms. Thompson and Ms. Williams have lost their employment and have suffered extreme emotional distress with attendant physical symptoms and injury to their reputations.”

“Lost their employment”?  It’s as though ACORN is saying, “Hey, one day they just lost their jobs.  It’s crazy!  We don’t know what happened!”

And how does ACORN deal with the firing during the lawsuit?  If they defend the firings as appropriate, how can they make a claim for damages on behalf of the employees?  And if they claim damages based on the firings being improper, isn’t ACORN itself on the hook for damages? 

No matter how ACORN characterizes the firings, there is an irreconcilable conflict of interest that even a carefully worded waiver can’t overcome.  In its haste to strike back at these two kids (O’Keefe is 23 and Giles is 20), ACORN has really gone out on a limb.

Next time:  ACORN’s nutty allegations

Oh, The Humanity!

“If we didn’t laugh, we would all go insane.” — Jimmy Buffett

Just when you think you’ve seen it all, you see something new.  Yesterday, the Michigan Court of Appeals issued its opinion in Liberty Mutual Fire Insurance Co v Stoutenberg.  The court found that the insurance company did not have to cover Stoutenberg in a pending civil case.  This is not itself a remarkable finding, since it happens often, but the facts of the case are outrageous.  Here, the court describes what happened:

On the evening of January 8, 2006, defendant Patrick Stoutenburg and Sandra Nash dined at Xochimilcos Mexican Restaurant in Detroit.  [Ed. note:  delicious food at Xochis!]  There, Stoutenburg and Nash ate and consumed approximately three to four margaritas each, in addition to imbibing alcoholic beverages prior to arriving at Xochimilcos. During dinner, Nash told Stoutenburg that her ex-husband, defendant James Dimitrijevski, had physically abused her in the past. Nash also showed Stoutenburg the marks left on her skin from the abuse.

Following dinner, Stoutenburg and Nash returned to Stoutenburg’s home, where Dimitrijevski was visiting his girlfriend, Debbie Rolander. There, Stoutenburg initiated an argument with Dimitrijevski, apparently over his past treatment of Nash. A verbal altercation ensued on Stoutenburg’s porch. Eventually, Dimitrijevski, who is much larger than Stoutenburg, grabbed Stoutenburg by the throat, pushed him against a wall, and shoved him into a chair.  Stoutenburg then ordered Dimitrijevski and Rolander to leave his house, and when Dimitrijevski refused, Stoutenburg replied, “[Y]ou [expletive] with the wrong person, I’m going to get my gun.” Stoutenburg went to his bedroom, retrieved a gun owned by his brother, and returned to the porch holding a rifle pointed at the ground. The gun discharged and a bullet ricocheted off the floor and stuck Dimitrijevski in the ankle. Following the shooting, the police were contacted, and Stoutenburg was arrested for felonious assault.

Naturally, this being America and all, Dimitrijevski (the girlfriend abuser) sued Stoutenberg (the ex-boyfriend shooter), and Stoutenberg turned it over to his insurance company!

The first amazing thing is that a classy guy like Stoutenberg even had insurance.  The second is that the insurance covered accidents, and Stoutenberg had already pleaded guilty to the intentional discharge of a firearm in a dwelling (and discharging a firearm while under the influence).

The insurance company then filed a lawsuit, asking the court to declare that it did not have to defend Stoutenberg.  The trial court agreed, and Stoutenberg appealed.  The Court of Appeals affirmed the trial court, holding that because Stoutenberg had pleaded guilty to firing the gun intentionally, he could not now claim that the firing was an accident. 

Seems obvious, right?  So, you ask, how did it get to the Court of Appeals?  Where did Stoutenberg come up with the money to pay an attorney to pursue such a ludicrous appeal? 

He didn’t. 

Stoutenberg was represented by the UAW Legal Services Plan, which is a benefit provided to UAW members through collective bargaining.  So, Stoutenberg paid nothing and did not feel the true cost of the litigation.  That was absorbed by the UAW and the insurance company, which means it was passed along to the public through higher insurance premiums and through the pricing of the goods sold by Stoutenberg’s employer.

This case illustrates in a small way the problem with third-party payer systems, such as legal services plans or health care insurance.  Consumers do not have to account for the true cost of the goods or services they purchase, so they do not self-regulate.  In the case of UAW Legal Services, this results in lawsuits and appeals that otherwise would not be clogging up our courts.

I have had some personal experience here.  A husband and wife borrowed money to purchase a lot and install a manufactured home.  The builder screwed up, and the couple sued.  But, they sued not just the builder, but the bank (my client) that lent them the money.  It was a frivolous claim, but they were represented by UAW Legal Services, so they pursued it.  The result?  Case dismissed, and the couple — and UAW LS — owe my client over $20,000 in sanctions.

That’s pretty expensive for free legal services.

Keepin’ It Real

Yesterday, the Michigan Lawyers Weekly published a column I wrote, responding to an attorney’s misreading of a recent Court of Appeals dissent.  They edited my response somewhat and, in so doing, removed what I considered to be the best part.  So, I reproduce it here, as originally written.  Enjoy!

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Michigan Lawyers Weekly published a letter from Paul Rosen on July 20, 2009, headlined “Our courts must rule based on law, not business interests.”  Mr. Rosen strains beyond the breaking point to find an example to fit his thesis, and the thesis itself is contrary not only to the history and purposes of tort law, but also contradicted by Mr. Rosen’s own argument.

Mr. Rosen’s letter posits that Judge Richard Bandstra’s dissent in Price v Kroger Co. illustrates the concern of Justices Breyer and O’Connor that the courts should not be viewed as an extension of the Junior League or, in Mr. Rosen’s words, the “Chamber of Commerce.”  He accuses the Federalist Society of advancing an economic agenda that did not make “businesses live up to reasonable and responsible standards for protecting the public,” resulting in the “greed and self-interest that precipitated on [sic] this terrible recession.”

Not only is Mr. Rosen’s knowledge of our current economic crisis lacking, so is his facility with Greek mythology.  He states that “we live in an economic Agamemnon.”  Agamemnon was the mythological  commander of the Achaeans in the Trojan War.  So, according to Mr. Rosen, “we live in an economic mythological Greek military commander.”  What does that mean?  But I digress.

In Price, the plaintiff claimed she fell over a one-inch wire prong allegedly extending from a basket of sale candy.  The plaintiff said the prong was two or three inches off the floor.  She sued Kroger and the trial court dismissed the case, finding the metal prong was open and obvious and further rejecting the notion that the prong “was unavoidable or posed an unreasonably high risk of severe injury.”  The Court of Appeals reversed in a 2-1 decision, finding a genuine issue of material fact as to whether the wire was open and obvious.

Judge Bandstra dissented, disagreeing with the majority’s “open and obvious” analysis, and further observing that there is more to the required inquiry.  Quoting Justice Cavanagh’s opinion in Williams v Cunningham Drug Stores, Judge Bandstra observed that premises liability “does not extend to conditions from which an unreasonable risk cannot be anticipated.”  Therefore, the issue was whether the one-inch wire constituted a dangerous condition presenting an unreasonable risk of harm.

Reasonable minds could differ on the application of the law to the facts in Price, but it is clear that Judge Bandstra engaged in a thorough legal analysis, basing his position on “the law,” as desired by Mr. Rosen.

Mr. Rosen objects to a single paragraph in Judge Bandstra’s dissent, in which he observes the probable impact of the majority’s decision on Michigan’s business environment.  It is this one paragraph on which Mr. Rosen focuses, although it is what is known as obiter dicta (but that’s Latin; we already know Mr. Rosen prefers Greek) — an opinion voiced by a judge that has only incidental bearing on the case in question and is therefore not binding.  Judge Bandstra points out that “the result here will further discourage employers from locating in Michigan.”  This is presented as an observation, not as the basis of his dissent, which is clearly founded on his view of the law.

Interestingly, Mr. Rosen’s argument is self-contradictory.  He contends that the courts should not base their decisions on societal impact, and as his evidence he points to the current state of our economy.  Then he argues that if courts had ruled differently, we could have avoided our current economic problems.  Presumably, therefore, economic impact is something the courts should consider.  But if economic impact is irrelevant, as he claims, his argument is completely and irretrievably inconsistent.

Perhaps Mr. Rosen believes that courts can consider the impact of their decisions, provided they do not consider the impact on employers.  If so, he should recall that without employers, there are no employees, a fact which is painfully obvious in Michigan.  Does he contend that courts purposely should decide cases against employer interests?

Often, lawyers can benefit from returning to the classics, such as Greek mythology or Prosser on Torts.  Prosser points out:

Society has some concern even with the single dispute involved in a particular case; but far more important than this is the system of precedent on which the entire common law is based, under which a rule once laid down is to be followed until the courts find good reason to depart from it, so that others now living and even those yet unborn may be affected by a decision made today.  There is good reason, therefore, to make a conscious effort to direct the law along lines which will achieve a desirable social result, both for the present and for the future.

Tort law generally, and premises liability in particular, reflect a balance – to what extent should persons be responsible for their own injuries or be insurers against damages incurred by others?  While no rule can encompass every set of facts and cases on the margins – such as Price – are difficult, it should give us all pause to consider that the majority in Price would subject a defendant to litigation over a one-inch wire prong protruding from a candy sale bin.  Is there no room for common sense in our jurisprudence?

Mr. Rosen hyperbolizes beyond credulity when he accuses Judge Bandstra of “undermin[ing] the perception of an independent judiciary, creat[ing] a preferred class of citizens in violation of equal protection, and attack[ing] the jury system,” all based on a single paragraph of dicta in a dissent.  Discussing the permissible considerations upon which an opinion legitimately may be based would be interesting, and may be necessary, but Mr. Rosen’s letter does nothing to advance this discourse. 

Remembering the Chief Justice

The Supreme Court is not particularly transparent — its decisions are reached behind closed doors, with only the justices in attendance.  From time to time, there are new “tell all” books about life behind the bench, but it’s difficult to gauge their accuracy. 

One good source of information, however, is the papers of the justices.  Recently, papers belonging to the late Chief Justice William Rehnquist have been released, giving an important glimpse into the man.

William Rehnquist served on the U.S. Supreme Court for 33 years, the last 19 as Chief Justice.  He wrote about and commented on the most important issues of our day.  More than that, though, his papers reveal his close personal relationships with the other justices, even those with whom he usually disagreed. 

I always liked the Chief Justice, although I never knew him, of course, and I almost always agreed with him.  It’s reassuring, therefore, to see that the private Rehnquist was a genuinely nice guy.

Check out the story here.

The Opening Salvo

The plaintiffs’ bar — particularly the plaintiffs’ personal injury bar — relies heavily on emotion and hysterics to move public opinion, with only a passing regard for the truth.  A case in point was a June 9 column in the Detroit Legal News by a plaintiffs’ attorney, decrying a recent Michigan Court of Appeals decision.  What follows is a version of my response, edited somewhat for this post, but essentially unchanged.  This will be characteristic of the sort of analysis and review I intend to put on this site.  Enjoy and comment!

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I do not generally practice personal injury law, nor do I claim to be an expert on no-fault insurance, but I was struck by the absurdity of a column in the Detroit Legal News on June 9, titled “Decision allows insurers to get away with lying.”  This column was so obviously wrong and so symptomatic of the problems with our current legal system and our society that I felt it necessary to respond.

The column’s author, a well-known auto negligence attorney who represents plaintiffs exclusively, seriously misrepresented the basis for the Michigan Court of Appeals’ ruling in Johnson v Wausau, in which the Court affirmed partial summary disposition for the defendant.  The author states that the “Court of Appeals held . . . that even if an insurance claims adjuster’s representation is fraudulent – meaning even if it’s a deliberate lie – an insured person in Michigan cannot establish that he or she relied on this lie to sue the insurance company for fraud.”  This holding does not appear anywhere in the decision.

Johnson centered on a plaintiff-caregiver’s claims against an insurance company for breach of contract and fraud.  Plaintiff was the second person to care for a woman who was injured as a baby in a 1983 automobile accident.  The plaintiff claimed that the insurance company failed to pay hourly attendant care benefits, paying a small daily rate instead, and that the insurance adjuster committed a fraud by telling her – falsely, as it turned out – that there were no additional benefits to which she was entitled.

The insurance company moved for partial summary disposition, claiming that the benefits sought by the plaintiff were limited by the no-fault law’s “one-year-back” rule, which provides that a “claimant may not recover benefits for any portion of the loss incurred more than 1 year before the date on which the action was commenced.”  MCL 500.3145(1),

The trial court granted the motion, and the Court of Appeals granted the plaintiff’s application for leave to appeal.  After leave was granted, the Supreme Court issued its decision in Cooper v Auto Club Insurance Association, in which it held that common law fraud claims are separate and distinct from claims under the no-fault law and, therefore, are not subject to the one-year-back rule.

In its Johnson decision, the Court of Appeals examined the elements of the plaintiff’s common law fraud claims, an important aspect of which is reliance.  The Court quoted approvingly from the Supreme Court’s Cooper opinion, in which the high court cited authorities ranging from 1871 to 2005.  Distilled to its essence, the Court of Appeals found that (1) insureds must show that any reliance on [the insurer’s] representations was reasonable; (2) fraud cannot be perpetrated upon one who has full knowledge to the contrary of a representation; (3) one is presumed to have read the terms of his or her insurance policy; (4) where the insured has the same knowledge or means of knowledge as the insurer, the insurer cannot be regarded as occupying any fiduciary relationship that would entitle the insured to rely on the insurer’s representations; and (5) insureds are bound to inform themselves of their rights before acting, and, if they fail to do so, they themselves are responsible for the loss.

The Court of Appeals also expressly quoted Cooper (which is the law in Michigan) for the proposition that “when the process involves information and facts that are exclusively or primarily within the insurers’ ‘perceived ‘expertise’ in insurance matters, or facts obtained by the insurer[s] in the course of [their] investigation, and unknown’ to the insureds, the insureds can more reasonably argue that they relied on the insurers’ misrepresentations.”

Thus, the Court did not find that insureds cannot establish reliance, contrary to the claims of the plaintiffs’ attorney who wrote the June 9 column.  Instead, the Court described those circumstances in which insureds are themselves responsible and those in which insureds can plausibly argue they reasonably relied upon their insurer’s representations..

The Court of Appeals affirmed the trial court, finding the plaintiff could not establish that either she or her predecessor caregiver relied upon the misrepresentation of the insurer because the representation “did not involve information or facts that were exclusively or primarily in the control of” the insurer.  The Court further stated that the plaintiff “had means, i.e., consultation with a lawyer, to determine whether [the adjuster’s] representation was true. Indeed, soon after plaintiff learned that additional benefits might be available . . .she consulted a lawyer and the present case was initiated soon thereafter.  Plaintiff does not claim, nor is there even the slightest hint of evidence, that defendant in any way prevented her . . . from determining the truthfulness of [the adjuster’s] representation.”

There is nothing new in the Court’s recitation of the law or its holding.  The cases cited for these propositions span nearly 140 years of Michigan jurisprudence.  The Johnson decision recognizes the enforceability of contracts and the importance of exercising personal responsibility.

And therein lies the rub for the author of the June 9 column.  The notion of personal responsibility and accountability directly threatens the livelihood of those who depend upon emotion and histrionics as a substitute for logic and the rule of law.  This explains why the author seizes upon one parenthetical phrase – “i.e., consultation with a lawyer” – to misrepresent the holding completely and to claim, disingenuously, that the decision protects “a lying insurance company” over “a brain-injured baby.”

Johnson does nothing more than apply time-honored legal principles, albeit to a case with painful facts.  The author of the June 9 column ignores the aphorism that “hard cases make bad law” in favor of an approach that ultimately would eliminate all communications, even helpful ones, between insurance company representatives and their insureds. 

Under the system apparently preferred by the author, insureds aiming to avoid the one-year-back rule could claim that insurance adjusters lied to them, without having to show they reasonably relied on the adjusters’ representations.  While that would be a boon for the plaintiffs’ personal injury bar, the only rational response from the insurance companies to such a rule would be to prohibit all verbal communications with their insureds in favor of written communications vetted by the legal department, thus imposing tremendous and unworkable transactional burdens.

The author’s response to this may well be that insurance companies would have nothing to fear if they just told the truth all the time. 

You mean, like plaintiffs and their lawyers? 

Just as it is wrong to paint all plaintiffs and their lawyers with one brush, it is similarly wrong to claim, as the author does, that “thousands of people . . . will now be lied to by insurance company adjusters” in order to “save millions of dollars at the expense of the most vulnerable and catastrophically injured members of our communities[.]”

Everyone has a right to his or her opinion, but no one has a right to be wrong on the facts.  By misrepresenting the Johnson holding, the author of the June 9 column did nothing to advance the discourse over how to improve our legal system, but his obvious desire to jettison any concept of personal responsibility certainly demonstrated one of its gravest shortcomings.