Brownridge v. Michigan Mut. Ins. Co.

• Decision Date: 21 July 1982
• Docket Number: Docket No. 49751
• Citation: 115 Mich.App. 745,321 N.W.2d 798
• Parties: Joan BROWNRIDGE, Plaintiff-Appellee, v. MICHIGAN MUTUAL INSURANCE COMPANY, Defendant-Appellant. 115 Mich.App. 745, 321 N.W.2d 798, 46 Fair Empl.Prac.Cas. (BNA) 1635, 3 Indiv.Empl.Rts.Cas. (BNA) 1213
• Court: Court of Appeal of Michigan — District of US

Page 798

321 N.W.2d 798

Joan BROWNRIDGE, Plaintiff-Appellee, v. MICHIGAN MUTUAL INSURANCE COMPANY, Defendant-Appellant.

Docket No. 49751.

115 Mich.App. 745, 321 N.W.2d 798,

46 Fair Empl.Prac.Cas. (BNA) 1635,

3 Indiv.Empl.Rts.Cas. (BNA) 1213

Court of Appeals of Michigan.

Submitted Oct. 13, 1981.

Decided May 4, 1982.

Released for Publication July 21, 1982.

[115 MICHAPP 746] David K. Wenger, Detroit, for plaintiff-appellee.

Riley & Roumell by Craig W. Lange, Detroit, for defendant-appellant.

Before MacKENZIE, P. J., and BRONSON and BEASLEY, JJ.

MacKENZIE, Presiding Judge.

Plaintiff brought this action against her former employer to obtain damages and equitable relief for an allegedly wrongful discharge from employment. Plaintiff claimed that she had been discharged by defendant for refusing to engage in certain discriminatory "redlining" practices. Plaintiff claimed that such practices were contrary to public policy and violated the Uniform Trade Practices Act, M.C.L. Sec. 500.2001 et seq.; M.S.A. Sec. 24.12001 et seq. Defendant's motion for accelerated and summary judgment was denied and defendant appeals by leave granted.

We need only address one of the issues raised by defendant. Defendant argues that this action was barred by res judicata and that the circuit judge therefore erred by denying its motion for accelerated judgment pursuant to GCR 1963, 116.1(5). Plaintiff had commenced an action against defendant[115 MICHAPP 747] in the United States District Court for the Eastern District of Michigan on January 19, 1979. In that action, plaintiff claimed that her discharge by defendant was the product of sexual discrimination in violation of federal law. Plaintiff stipulated to the dismissal with prejudice of the action in federal court and an order dismissing the case with prejudice was entered on August 28, 1979. Plaintiff's action in state court commenced on August 10, 1979.

In Gose v. Monroe Auto Equipment Co., 409 Mich. 147, 160, 294 N.W.2d 165 (1980), the Court explained its position on res judicata as follows:

"Our opinions have endorsed both a narrow and a broad application of the rule. Narrow application bars a second action only if the same question was actually litigated in the first proceeding. Broad application bars as well those claims arising out of the same transaction which plaintiff could have brought, but did not. In recent opinions, we have acknowledged the conflicting language and opted for the broad rule. Gursten v. Kenney, 375 Mich. 330, 334-335, 134 N.W.2d 764 (1965) (order of dismissal); Curry v. Detroit, 394 Mich. 327, 332, 231 N.W.2d 57 (1975) (order of summary dismissal)." (Footnotes omitted.)

Gursten and Curry indicate that Michigan follows the rule stated in Henderson v. Henderson, 3 Hare 100, 115, 67 Eng.Rep. 313 (1843), and quoted in Harrington v. Huff & Mitchell Co., 155 Mich. 139, 142, 118 N.W. 924 (1908):

"The plea of res judicata applies, except in special cases, not only to points upon which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time."

[115 MICHAPP 748] The rule was further explained in Curry, supra, 394 Mich. 331, 231 N.W.2d 57, quoting Tucker v. Rohrback, 13 Mich. 73, 75 (1864):

"[A] judgment, to constitute a bar to a claim in a subsequent action, must be rendered upon the merits, upon the same matter in issue, and between the same parties or their privies."

Since both actions arose out of the same discharge from employment, both actions arose "out of the same transaction", both actions involved "point[s] which properly belonged to the subject of litigation", and both involved "the same matter in issue". See Arnold v. Masonic Country Club, 268 Mich. 430, 256 N.W. 472 (1934). A voluntary dismissal with prejudice is a final judgment on the merits for res judicata purposes. Astron Industrial Assoc., Inc. v. Chrysler Motors Corp., 405 F.2d 958 (CA 5, 1968). That plaintiff could have brought her state claims in the federal action may be shown by reference to United Mine Workers of America v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 1138, 16 L.Ed.2d 218 (1966):

"Pendent jurisdiction, in the sense of judicial power, exists whenever there is a claim 'arising under [the] Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority * * *,' U.S.Const., Art. III, Sec. 2, and the relationship between that claim and the state claim permits the conclusion that the entire action before the court comprises but one constitutional 'case.' The federal claim must have substance sufficient to confer subject matter jurisdiction on the court. Levering & Garrigues Co. v. Morrin, 289 U.S. 103 [53 S.Ct. 549, 77 L.Ed.2d 1062 (1933) ]. The state and federal claims must derive from a common nucleus of operative fact. But if, considered without regard to their federal or state character, a plaintiff's claims are such that he would ordinarily be [115 MICHAPP 749] expected to try them all in one proceeding, then, assuming substantiality of the federal issues, there is power in federal courts to hear the whole." (Footnotes omitted. Emphasis in original.)

Had plaintiff raised her state claims in federal court, the federal judge would have had discretion to decline to hear them. Id., 726, 86 S.Ct. 1139. However, we see no reason why the existence of such discretion should limit the res judicata effect of a federal judgment where, as here, plaintiff never gave the federal judge an opportunity to exercise his discretion.

Plaintiff relies on GCR 1963, 203.1:

"A complaint shall state as a claim every claim either legal or equitable which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject-matter of the action and does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction. Failure by motion or at the...