Blair v. Checker Cab Co.

• Decision Date: 01 November 1996
• Docket Number: Docket No. 185916
• Parties: , 1997-2 Trade Cases P 71,914 Nancy BLAIR, Plaintiff-Appellant, v. CHECKER CAB COMPANY, Defendant-Appellee.
• Court: Court of Appeal of Michigan — District of US

Page 439

558 N.W.2d 439

219 Mich.App. 667, 1997-2 Trade Cases P 71,914

Nancy BLAIR, Plaintiff-Appellant, v. CHECKER CAB COMPANY, Defendant-Appellee.

Docket No. 185916.

Court of Appeals of Michigan.

Submitted Sept. 4, 1996, at Detroit.

Decided Nov. 1, 1996, at 9:30 a.m.

Released for Publication Jan. 24, 1997.

Milton R. Henry, Bloomfield Hills, for plaintiff-appellant.

Alan R. Miller, P.C. by Thomas J. Fayfer, Birmingham, for defendant-appellee.

Before YOUNG, P.J., and TAYLOR and R.C. LIVO, ^* JJ.

TAYLOR, Judge.

Plaintiff appeals as of right from an order granting summary disposition of her complaint against defendant. We affirm in part, reverse in part, and remand.

Defendant is a voluntary nonprofit corporation whose members own and operate taxicabs that are licensed by the City of Detroit. The purpose of the corporation is to promote the private business interests of its membership through the rendition of certain services that include the operation of a computerized telephone referral and dispatch system. Defendant's constitution and bylaws contain an antitampering provision that provides that members may be expelled if they attempt to solicit a driver of another member.

Plaintiff became a member of the corporation in 1991. Like other members, plaintiff leased her taxicabs to drivers on a daily basis. In 1994, she was accused of violating the antitampering provision by soliciting other members' drivers to lease a taxicab from her at a lower daily rate. After notice and an opportunity to be heard at a scheduled meeting of defendant's board of directors, the board found that plaintiff had violated the antitampering bylaw and ordered her to pay a fine of $5,000. The board further ordered that plaintiff be expelled in the event that she did not pay the fine.

Plaintiff was subsequently expelled for failure to pay the fine. Plaintiff then filed a lawsuit against defendant, alleging: (1) the hearing she was provided was contrary to defendant's constitution and bylaws and denied her due process; (2) the antitampering bylaw implemented an unconstitutional system of involuntary servitude; and (3) the antitampering bylaw violated § 2 of the Michigan Antitrust Reform Act (MARA), M.C.L. § 445.772; M.S.A. § 28.70(2).

Plaintiff first argues that the trial court erred in considering documentary evidence in granting the motion for summary disposition. We disagree.

Defendant specifically moved for summary disposition pursuant to MCR 2.116(C)(8). Nevertheless, defendant submitted documentary evidence in support of its motion. MCR 2.116(G)(5) provides that the trial court may not consider documentary evidence when considering summary disposition motions brought pursuant to MCR 2.116(C)(8). However, where a party brings a summary disposition motion under the wrong subrule, the trial court may proceed under the appropriate subrule as long as neither party is misled. Ruggeri Electrical Contracting Co., Inc. v. Algonac, 196 Mich.App. 12, 18, 492 N.W.2d 469 (1992). Here, in opposing defendant's motion for summary disposition, plaintiff relied on her pleadings and documentary evidence and argued that genuine issues of material fact remained. Because plaintiff was not misled by defendant's citing the wrong subrule, the trial court did not err in considering documentary evidence and could consider the motion pursuant to subrule C(10). Id.

Plaintiff also claims that the hearing she was provided violated defendant's constitution and bylaws and her right to due process. The trial court summarily dismissed this claim because plaintiff did not exhaust her administrative remedy to appeal the board's decision to the senior members of the corporation as allowed by defendant's constitution and bylaws. Generally, summary disposition pursuant to MCR 2.116(C)(4) (lack of jurisdiction) is proper when a party such as plaintiff has failed to exhaust her administrative remedies. See Sewell v. Detroit Electrical Contractors Ass'n, 345 Mich. 93, 119-120, 75 N.W.2d 845 (1956); W.A. Foote Memorial Hosp. v. Dep't of Public Health, 210 Mich.App. 516, 522, 534 N.W.2d 206 (1995). However, a party is not required to exhaust internal remedies (1) when such a step would be futile, Manor House Apartments v. City of Warren, 204 Mich.App. 603, 605, 516 N.W.2d 530 (1994), or (2) under certain circumstances before filing a claim based on a constitutional issue. See Michigan Supervisors Union O.P.E.I.U. Local 512 v. Dep't of Civil Service, 209 Mich.App. 573, 578, 531 N.W.2d 790 (1995); W.A. Foote Memorial Hosp., supra at 524, 534 N.W.2d 206. Here, any appeal to defendant's senior members would have been futile because the senior members could not overrule the bylaws. Thus, an appeal would have been futile because defendant's senior members could not have granted plaintiff the relief she sought. However, summary dismissal of plaintiff's due process claim was proper because the hearing did not involve state action. See Christensen v. Michigan State Youth Soccer Ass'n, Inc., 218 Mich.App. 37, 42-43, 553 N.W.2d 638 (1996); Khalifa v. Henry Ford Hosp., 156 Mich.App. 485, 498, 401 N.W.2d 884 (1986). Therefore, plaintiff may argue on remand that her expulsion was not handled in accordance with defendant's constitution and bylaws, but may not argue that her rights to due process were violated.

Plaintiff also claims that the bylaw that she was found to have violated creates an unconstitutional system of involuntary servitude because drivers were limited in their ability to take positions with other taxicab owners who were members of defendant. Initially, we question whether plaintiff has standing to raise this specific claim on behalf of others (the drivers). ¹ In any event, the claim is without merit. Both the Michigan and United States Constitutions prohibit involuntary servitude. U.S. Const., Am. XIII; Const.1963, art. 1, § 9. Because the language of these provisions are nearly identical and there is no constitutional authority for interpreting these provisions differently, the Michigan provision should be interpreted in conformity with the federal provision. People v. Pickens, 446 Mich. 298, 315, 521 N.W.2d 797 (1994). Involuntary servitude is defined in federal case law as the coerced service of one person for another through the use, or threatened use, of law, physical force, or some other method that causes the laborer to believe that the laborer has no alternative to performing the service. United States v. Mussry, 726 F.2d 1448, 1453 (C.A.9, 1984). Where the laborer has some alternative to performing the service, even if distasteful or less attractive than the service, there is no involuntary servitude. Brogan v. San Mateo Co., 901 F.2d 762, 763-764 (C.A.9, 1990). Because both the drivers and the owners could choose to work outside defendant company, or work in another field, plaintiff's involuntary servitude claim fails.

Plaintiff further argues that the trial court improperly granted summary disposition of her claim that defendant violated the MARA by forming a conspiracy or combination in restraint of trade. M.C.L. § 445.772; M.S.A. § 28.70(2). We agree.

The trial court's opinion indicates that the court granted summary disposition of the MARA claim pursuant to MCR 2.116(C)(8) (failure to state a claim upon which relief may be granted). In deciding such a motion, the court must accept all factual allegations as true and construe them most favorably to the nonmoving party. Wade v. Dep't of Corrections, 439 Mich. 158, 163, 483 N.W.2d 26 (1992). Such a motion should be granted only if the claim is so clearly unenforceable as a matter of law that no factual development could possibly justify recovery. Id.; Simko v. Blake, 448 Mich. 648, 654, 532 N.W.2d 842 (1995). Applying these rules, we find summary disposition of plaintiff's antitrust claim to have been improper.

The trial court held that plaintiff's antitrust claim was subject to summary disposition because it did not allege a combination of two or more persons. M.C.L. § 445.772; M.S.A. § 28.70(2) provides: "A contract, combination, or conspiracy between 2 or more persons in restraint of, or to monopolize, trade or commerce in a relevant market is unlawful," and this Court has found that an agent or employee cannot be considered a separate entity from his principal or corporate employer, respectively, as "long as the agent or employee acts only within the scope of his agency of [sic] employment." Metro Club, Inc. v. Schostak Bros. & Co., Inc., 89 Mich.App. 417, 420, 280 N.W.2d 553 (1979). In interpreting a similar provision of the Sherman Antitrust Act, 15 U.S.C. 1 et seq., federal courts have found that a corporation generally cannot conspire with its board of directors, officers, or employees, because a corporation acts only through those persons and conspiring with those persons would be like conspiring with itself. See Domed Stadium Hotel, Inc. v. Holiday Inns, Inc., 732 F.2d 480, 486 (C.A.5, 1984); Rothery Storage & Van Co. v. Atlas Van Lines, Inc., 597 F.Supp. 217, 225 (D.D.C., 1984). Thus, there can be no conspiracy between a corporation and its directors if the directors are acting on behalf of the corporation. Anno: Business units or persons within single, commonly owned enterprise as conspiring with each other in violation of § 1 or § 3 of Sherman Act (15 U.S.C.S. §§ 1, 3), 20 A.L.R.Fed. 682, § 7. Federal courts have found an exception to this general rule, however, where the directors have an independent personal stake in a particular action and, therefore, are actually acting on their own behalf. Domed Stadium Hotel, supra at 486, n. 5; Rothery Storage & Van Co., supra at 225.

Because the MARA and the Sherman Act require similar evidence of concerted action or combination, this Court will consider federal precedent interpreting the Sherman Act's prohibition on combination in restraint of trade. Mohammed v. Union Carbide Corp., 606 F.Supp. 252, 257 (E....