Gardner v. Stodgel

Decision Date10 April 1989
Docket NumberDocket No. 103301
Citation175 Mich.App. 241,437 N.W.2d 276
PartiesBetty GARDNER, individually and as Next Friend of April Foster and Starr Foster, Plaintiff-Appellant, v. Joseph E. STODGEL, d/b/a White Rock Tavern, T & L Operations, Inc., d/b/a Dixie Bar, and Loy M. Limbaugh, d/b/a Sailmaker Lounge, jointly and severally, Defendants-Appellees, and Carl Combs and Marilee Kelly, d/b/a Club Tahoe, Defendants. 175 Mich.App. 241, 437 N.W.2d 276
CourtCourt of Appeal of Michigan — District of US

[175 MICHAPP 243] Woll, Crowley, Berman, Olsman & Nolan, P.C. by Alan F. Giles, Royal Oak, for plaintiff-appellant.

Garan, Lucow, Miller, Seward, Cooper & Becker, P.C. by Thomas F. Myres and Robert D. Goldstein, Detroit, for T & L Operations, Inc.

Before J.H. GILLIS, P.J., and DOCTOROFF and SANBORN, * JJ.


This is a dramshop action, M.C.L. Sec. 436.22; M.S.A. Sec. 18.993, in which plaintiff appeals as of right from the trial court's orders granting defendants' motions for summary disposition pursuant to MCR 2.116(C)(8), on the basis that plaintiff failed to "name and retain" the alleged intoxicated person (AIP). M.C.L. Sec. 436.22(5); M.S.A. Sec. 18.993(5). We affirm.

On March 5, 1984, while driving in Waterford Township, Emma Jean Frisch (decedent) caused her vehicle to cross the center line and collide with another car. Both drivers (Frisch and James Monforton) were killed. Decedent's blood alcohol [175 MICHAPP 244] level was determined to be 0.22 percent. Her daughter, April Foster, a passenger, sustained a closed-head injury.

On February 1, 1985, plaintiff Betty Gardner, mother of decedent, filed suit on behalf of April and Starr Foster, decedent's daughters, alleging violation of the dramshop act. Decedent's estate was not named as a defendant.

Plaintiff's first amended complaint was filed June 24, 1985. The second amended complaint, filed in early February, 1986, added defendants Carl Combs and Marilee Kelly, doing business as Club Tahoe. Plaintiff's case and the Monforton case were mediated together October 14, 1986. On January 23, 1987, plaintiff moved for a determination of proper parties under the dramshop act or to amend the complaint to add the Frisch estate as a defendant. The court informed plaintiff's counsel that it would not rule on the motion. Plaintiff then moved to add the estate as a defendant. That motion was denied at a hearing on March 11, 1987.

On March 18, 1987, Betty Gardner, as next friend of April Foster, filed a separate negligence suit against the estate of Emma Jean Frisch. Defendant T & L Operations, Inc. (T & L) moved for summary disposition of the instant case on the basis that plaintiff's failure to name and retain the AIP defeated the cause of action under the dramshop act. Plaintiff then requested that the new case be consolidated with this case. This motion was denied.

The trial court granted T & L's motion for summary disposition pursuant to MCR 2.116(C)(8). Plaintiff's motion for rehearing was denied on July 31, 1987. Defendant Joseph E. Stodgel's motion for summary disposition was granted on September 8, 1987. Defendants Limbaugh, Combs and Kelly apparently[175 MICHAPP 245] settled with plaintiff. Plaintiff appeals from the orders granting summary disposition to defendants Stodgel and T & L Plaintiff first claims that the trial court erred in granting summary disposition on the basis of the "name and retain" provision of the dramshop act because an exception to that provision exists in situations where the plaintiff has no cause of action against the AIP. Plaintiff contends she and decedent's daughters are beneficiaries of decedent's estate. Thus, it would be meaningless for them to sue the estate because, in essence, they would be suing themselves. Plaintiff argues that the purpose and intent of the name and retain provision, to prevent possible fraud and collusion between the AIP and the plaintiff, does not apply in this case where there is no cause of action against the AIP and the AIP is deceased. We disagree with both plaintiff's reasoning and conclusion.

M.C.L. Sec. 436.22(5); M.S.A. Sec. 18.993(5), as amended by 1980 P.A. 351, provided, at times pertinent to this action:

"An action against a retailer, wholesaler, or anyone covered by this act or a surety, shall not be commenced unless the minor or the alleged intoxicated person is a named defendant in the action and is retained in the action until the litigation is concluded by trial or settlement." (Emphasis added.)

The particular objective of the dramshop act is to discourage bars from selling intoxicating beverages to minors or visibly intoxicated parties and to provide for full recovery under certain circumstances by those injured as a result of the illegal sale of intoxicating liquor. Browder v. International [175 MICHAPP 246] Fidelity Ins. Co., 413 Mich. 603, 611-612, 321 N.W.2d 668 (1982). The remedy provided to the injured person is not against the intoxicated person who caused the ultimate injury, but against the bar owner who sold intoxicating liquor to a minor or a visibly intoxicated person. Id., at p. 613, 321 N.W.2d 668; Millross v. Plum Hollow Golf Club, 429 Mich. 178, 184, 413 N.W.2d 17 (1987). The purpose of the name and retain provision is to avoid possible collusion between the plaintiff and the one who caused the injury. Browder, 413 Mich. at p. 615, 321 N.W.2d 668. Extrapolating from that purpose, we conclude that the name and retain provision is for the benefit of the tavern owner, in order to preserve his defenses against the plaintiff's claims. See Riley v. Richards, 428 Mich. 198, 209-210, 404 N.W.2d 618 (1987).

In Putney v. Haskins, 414 Mich. 181, 187, 190, 324 N.W.2d 729 (1982), reh. den. 414 Mich. 1111 (1982), our Supreme Court held that the legislative mandate of the name and retain provision must be enforced as written. It rejected the proposition that "substantial compliance" was sufficient and held that any settlement with the AIP requires the case against the tavern owner to be dismissed. However, the Court recognized an exception to the name and retain provision, as found in Salas v. Clements, 399 Mich. 103, 109, 247 N.W.2d 889 (1976), where the knowledge of the AIP's identity is unknown, "a circumstance entirely beyond [the plaintiff's] control."

In Riley, supra, 428 Mich. at p. 211, 404 N.W.2d 618, the Court again held that there can be no degrees of compliance with the name and retain provision. "Retained" means being a real party in interest in the full sense of those words. Id., at p. 213, 404 N.W.2d 618. The Court did not discuss the Salas exception.

Plaintiff contends that a second exception exists [175 MICHAPP 247] where it would be futile to require the plaintiff to name and retain a defendant against whom the plaintiff has no cause of action or where the intent of the statute, to avoid collusion, would not be enhanced. Plaintiff finds support for this conclusion in Scholten v. Rhoades, 67 Mich.App. 736, 242 N.W.2d 509 (1976) (in situations where no cause of action otherwise exists and recovery against the AIP is impossible, the mandatory application of the name and retain amendment is "awkward, strained and absurd"); Dickerson v. Heide, 69 Mich.App. 303, 244 N.W.2d 459 (1976) (name and retain provision should not be used to deny relief to plaintiffs who have no cause of action against the AIP); Schutz v. Murphy, 99 Mich.App. 386, 297 N.W.2d 676 (1980) (name and retain provision does not apply where plaintiff either cannot name the AIP or cannot retain the AIP as a defendant because the plaintiff has no cause of action against him); Newman v. Hoholik, 138 Mich.App. 66, 359 N.W.2d 253 (1984) (following Putney, Scholten is still "good law"; an injured person may maintain a dramshop action without naming and retaining as a party defendant a close family member against whom the plaintiff has no cause of action); Burke v. Angies, Inc., 143 Mich.App. 683, 373 N.W.2d 187 (1985) (adopted the holding of Newman; where the AIP was deceased and the plaintiffs were close family members [with no cause of action against the AIP], an exception to the name and retain provision exists).

The common factor in the above decisions is that the plaintiffs had no cause of action against the AIP. While we decline to comment on the propriety of the exception provided[175 MICHAPP 248] for in these decisions (see 1986 PA 176, effective July 7, 1986), we dispute the applicability of the exception to this case because we find that April Foster had a cause of action against her mother's estate since she was injured in the accident in which her mother, the AIP, was killed. Thus, she was required to name and retain decedent's estate as a party defendant. The trial court did not err when it dismissed plaintiff's case pursuant to the name and retain provision.

Plaintiff next claims that the trial court abused its discretion in denying plaintiff's motion to amend the complaint to add decedent's estate as a party defendant. MCR 2.118. We disagree.

A motion to amend a complaint should ordinarily be denied only where there is undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendment previously allowed, undue prejudice to the opposite party created by the allowance of the amendment, or futility of amendment. Davis v. Chrysler Corp., 151 Mich.App. 463, 473-474, 391 N.W.2d 376 (1986), lv. den. 428 Mich. 869 (1987). The trial court's decision to disallow the amendment will not be reversed absent an abuse of discretion. Rathbun v. Starr Commonwealth for Boys, 145 Mich.App. 303, 316, 377 N.W.2d 872 (1985), lv. den. 424 Mich. 908, 385 N.W.2d 585 (1986). When a trial court denies a motion to amend, the court must specify its reasons for doing so. Cummings v. Detroit, 151 Mich.App. 347, 352, 390 N.W.2d 666 (1986), lv. den. 426 Mich. 851 (1986).

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