B & B Inv. Group v. Gitler

Decision Date24 March 1998
Docket NumberDocket No. 189751
Citation229 Mich.App. 1,581 N.W.2d 17
PartiesB & B INVESTMENT GROUP, Plaintiff-Appellee, v. Pat GITLER and Mel Gitler, Defendants-Appellants.
CourtCourt of Appeal of Michigan — District of US

Sills, Law, Essad, Fiedler & Charboneau, P.C. by Ernest J. Essad, Jr., and David W. Geiss, Bloomfield Hills, for Plaintiff-Appellee.

Cox, Hodgman & Giarmarco by William H. Horton and Linda M. Watson, Troy, for Defendants-Appellants.

Before HOLBROOK, P.J., and WHITE and R.J. DANHOF *, JJ.

PER CURIAM.

In this statutory slander of title action, defendants appeal by leave granted the circuit court's order affirming the district court's judgment awarding plaintiff $30,000 in attorney fees and $7,500 in exemplary damages and various other orders of the district court. We affirm the award of attorney fees, vacate the award of exemplary damages, and remand in part.

I

Following a six-day bench trial, the district court issued an opinion and order from which we take these facts. Plaintiff 1 and defendant Pat Gitler (defendant) entered into a business relationship during either 1990 or 1991. The parties contemplated that plaintiff and defendant would join together to purchase real estate from mortgage foreclosures and sheriff's sales. Before their venture, the two were in competition with one another for selected properties and both were experienced in these types of real estate transactions.

During the course of the relationship, a dispute arose over the disbursement of certain funds from two particular pieces of property unrelated to this lawsuit. The parties were unable to resolve their dispute, and defendant caused claims of interest to be filed against seven other properties owned by plaintiff at that time. The claims of interest were filed as a matter of public record with the Oakland County Register of Deeds.

In March 1992, plaintiff filed suit, seeking removal of the claims of interest and monetary and equitable relief for the alleged slander of title. After hearings concerning the dispositive motions, the circuit court, in late June 1992, entered an order discharging the claims of interest, finding that the claims were discharged, released, and held for naught ab initio. The circuit court's order did not address the remaining slander of title claim, and, after mediation, the case was removed from the circuit court to the district court for trial.

The district court found no cause of action against defendant's husband, Mel Gitler. The court found that defendant had slandered the title of plaintiff's seven properties with malicious intent and in wilful and wanton disregard of plaintiff's rights under circumstances in which she had no cognizable interest in the properties, was aware that it was improper to file such claims of interest, and had been advised not to do so. The court further found that defendant made several public statements that demonstrated her intention to injure plaintiff and its business. The court awarded plaintiff $30,000 in attorney fees and $7,500 in exemplary damages.

II

Defendants 2 first argue that exemplary damages are not available under the slander of title statute, M.C.L. § 565.108; M.S.A. § 26.1278. This is an issue of first impression, which we review de novo. 3 Welch Foods, Inc. v. Attorney General, 213 Mich.App. 459, 461, 540 N.W.2d 693 (1995).

The primary goal of judicial interpretation of statutes is to ascertain and give effect to the intent of the Legislature. Farrington v. Total Petroleum, Inc., 442 Mich. 201, 212, 501 N.W.2d 76 (1993). If the plain and ordinary meaning of the language is clear, judicial construction is normally neither necessary nor permitted. Heinz v. Chicago Rd. Investment Co., 216 Mich.App. 289, 295, 549 N.W.2d 47 (1996). If reasonable minds can differ concerning the meaning of a statute, judicial construction is appropriate. Heinz, supra. The court must look to the object of the statute and to the harm it is designed to remedy and must apply a reasonable construction that best accomplishes the purpose of the statute. Marquis v. Hartford Accident & Indemnity (After Remand), 444 Mich. 638, 644, 513 N.W.2d 799 (1994).

The language of a statute should be read in light of previously established rules of the common law, including common-law adjudicatory principles. Nummer v. Dep't of Treasury, 448 Mich. 534, 544, 533 N.W.2d 250 (1995). Well-settled common-law principles are not to be abolished by implication, and when an ambiguous statute contravenes common law, it must be interpreted so that it makes the least change in the common law. Marquis, supra. Conversely, legislation must be interpreted in conformance with its express terms, even if in conflict with the common law. Tryc v. Michigan Veterans' Facility, 451 Mich. 129, 136, 545 N.W.2d 642 (1996). Statutes in derogation of the common law are narrowly construed. Rusinek v. Schultz, Snyder & Steele Lumber Co., 411 Mich. 502, 507-508, 309 N.W.2d 163 (1981).

M.C.L. § 565.108; M.S.A. § 26.1278, which is part of the marketable record title act, M.C.L. § 565.101 et seq.; M.S.A. § 26.1271 et seq., provides:

No person shall use the privilege of filing notices hereunder for the purpose of slandering the title to land, and in any action brought for the purpose of quieting title to land, if the court shall find that any person has filed a claim for that reason only, he shall award the plaintiff all the costs of such action, including such attorney fees as the court may allow to the plaintiff, and in addition, shall decree that the defendant asserting such claim shall pay to plaintiff all damages that plaintiff may have sustained as the result of such notice of claim having been so filed for record.

A

In Michigan, slander of title claims have both a common-law and statutory basis. Slander of title has been recognized at common law since at least 1900 as a remedy for malicious publication of false statements that disparage a plaintiff's right in property. See 2 Cameron, Michigan Real Property Law (2d ed), Slander of Title, § 30.18, pp 1461-1462, and cases cited therein, including Harrison v. Howe, 109 Mich. 476, 67 N.W. 527 (1896), and Michigan Nat'l Bank-Oakland v. Wheeling, 165 Mich.App. 738, 419 N.W.2d 746 (1988).

To establish slander of title at common law, a plaintiff must show falsity, malice, and special damages, i.e., that the defendant maliciously published false statements that disparaged a plaintiff's right in property, causing special damages. See Sullivan v. Thomas Organization, PC, 88 Mich.App. 77, 82, 276 N.W.2d 522 (1979); Michigan Real Property Law, supra at 1461; 50 Am.Jur.2d, Libel and Slander, § 554, p. 847. Pecuniary or special damages must be shown in order to prevail on a claim. Id., citing Patten Corp. v. Canadian Lakes Development Corp., 788 F.Supp. 975 (W.D.Mich., 1991); anno.: What constitutes special damages in action for slander of title, 4 A.L.R.4th 532, § 2, pp. 536-537 (noting that "the existence of special damages is an element of a cause of action for slander of title").

The same three elements are required in slander of title actions brought under M.C.L. § 565.108; M.S.A. § 26.1278. GKC Michigan Theaters, Inc. v. Grand Mall, 222 Mich.App. 294, 301, 564 N.W.2d 117 (1997). But see Stanton v. Dachille, 186 Mich.App. 247, 262, 463 N.W.2d 479 (1990) (stating that "the elements of slander of title are falsity of statement and malice").

In Michigan, special damages have been recognized to include litigation costs, see Chesebro v. Powers, 78 Mich. 472, 44 N.W. 290 (1889); impairment of vendibility, see Sullivan, supra at 85, 276 N.W.2d 522, and loss of rent or interest, Harrison, supra. See also 2 Stockmeyer, Michigan Law of Damages (2d ed), §§ 16B.30-16B.35, pp 16B.27-16B.29, and 50 Am Jur 2d, Libel and Slander, § 560, pp 853-855.

We note that there are only two reported slander of title cases in Michigan brought under M.C.L. § 565.108; M.S.A. § 26.1278, Stanton, supra, 4 and GKC Michigan Theaters, supra. 5 Exemplary damages have not been awarded in any Michigan slander of title case, either common-law or statutory. However, exemplary damage awards in intentional tort cases have been considered proper if they compensate a plaintiff for the humiliation, sense of outrage, and indignity resulting from injuries maliciously, willfully and wantonly inflicted by the defendant. Kewin v. Massachusetts Mut. Life Ins. Co., 409 Mich. 401, 419, 295 N.W.2d 50 (1980) (citing cases involving assault and battery and libel). The theory of these cases is that the reprehensibility of the defendant's conduct both intensifies the injury and justifies the award of exemplary damages as compensation for the harm done to the plaintiff's feelings. Id.

Nonetheless, where a cause of action is statutorily based, there must be a basis in the statute for awarding exemplary damages, i.e., either an express provision or a legislative history from which one could infer "a legislative intent to provide such an unusual remedy." Eide v. Kelsey-Hayes Co., 431 Mich. 26, 54-55, 427 N.W.2d 488 (1988) (Griffin, J. 6 ); Peisner v. Detroit Free Press, Inc., 421 Mich. 125, 134-135, n. 10, 364 N.W.2d 600 (1984). We conclude there is no such statutory basis here; there is neither an express provision nor a legislative history from which one could infer a legislative intent to provide exemplary damages. In enacting other statutes, the Legislature has included words expressly providing for exemplary damages where it has intended that they be recoverable. See Eide, supra at 55, 427 N.W.2d 488, and statutes there cited; see also n. 3, supra.

The Legislature having failed to include such language in this instant statute, we conclude that exemplary damages are not properly awarded under M.C.L. § 565.108; M.S.A. § 26.1278, and we vacate the trial court's award of exemplary damages in the amount of $7,500.

III

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