Grant v. Detroit Ass'n of Women's Clubs

• Decision Date: 08 September 1993
• Docket Number: Docket No. 93157,No. 3,3
• Citation: 505 N.W.2d 254,443 Mich. 596
• Parties: , 62 USLW 2192 Ellsworth GRANT, Plaintiff-Appellant, v. DETROIT ASSOCIATION OF WOMEN'S CLUBS, Defendant-Appellee. Calendar
• Court: Michigan Supreme Court

Page 254

505 N.W.2d 254

443 Mich. 596, 62 USLW 2192

Ellsworth GRANT, Plaintiff-Appellant, v. DETROIT ASSOCIATION OF WOMEN'S CLUBS, Defendant-Appellee.

Docket No. 93157.

Calendar No. 3.

Supreme Court of Michigan.

Argued June 10, 1993.

Decided Sept. 8, 1993.

[443 Mich. 598] Wayne County N'Hood Legal Services, Linda D. Bernard and Candace Crowley, Detroit, for plaintiff-appellant.

Hansen Clarke, Detroit, Gary N. Gershon, Michigan Migrant Legal Assistance Project, Inc., and Richard G. Kessler, Law Office of Richard Kessler, Grand Rapids, for defendant-appellee.

Marilyn Mullane, Michigan Legal Services and Ted Phillips, United Community Housing Coalition, Detroit, brief for amici curiae, Michigan Migrant Legal Assistance Project, (MMLAP), Michigan Farmworker Ministry Coalition, Union De Trabajadores Agricolas De Michigan (UTAM), United Community Housing Coalition, Michigan Housing Coalition, Michigan Legal Services, Coalition on Temporary Shelters, Inter-Faith Hospitality Ministries, Michigan Up & Out of Poverty Campaign, Homeless Drop-in Center, Urban League Homeless Strategy Coalition, Cass Corridor Neighborhood[443 Mich. 599] Development Corp., Alternatives for Girls and Bishop Thomas Gumbleton.

OPINION

MALLETT, Justice.

I

The present case involves the question whether a landlord-tenant legal relationship may be recognized pursuant to a contract of employment where use and occupancy of an apartment are the sole and full compensation for the services rendered. We answer in the affirmative and reverse and remand the case for further proceedings consistent with this opinion.

II

Plaintiff Ellsworth Grant occupied a two-bedroom apartment in defendant Detroit Association of Women's Clubs (DAWC) in the City of Detroit. Use and occupancy of the apartment, as well as basic utilities, were provided by DAWC pursuant to an employment contract in exchange for plaintiff's services as a full-time caretaker. The contract provided that the use of the apartment and payment for the utilities were the "sole and full compensation for [the] agreement." ¹ The contract further stated that DAWC could summarily dismiss plaintiff for cause, or terminate the agreement without cause at any time upon thirty days' written notice. ²

In a letter dated March 1, 1989, the president of DAWC terminated plaintiff's employment. Plaintiff testified that he received the letter on March 8, 1989. He responded on March 10, questioning the reasons for the termination. On March 18, the president replied, indicating "unsatisfactory" service as the reason for termination.

Without further notice, the president changed the locks on the apartment on April 5, 1989. Plaintiff's personal possessions, including cash, kitchen items, and a camera, remained inside the apartment.

Plaintiff brought an action in Wayne Circuit Court, seeking injunctive relief and damages, alleging that the change of locks unlawfully interfered with his possessory interest in the apartment. At a show cause hearing, the circuit court ruled that no tenancy existed and that plaintiff was a trespasser. The matter was held in abeyance pending commencement of summary eviction proceedings in the district court.

DAWC promptly instituted such proceedings, which were dismissed by the district court because it found that Grant was not a tenant, and, even if he was a tenant, defendant properly had given thirty days' notice. The Wayne Circuit Court affirmed, holding that no tenancy existed. The Court of Appeals denied Grant's application for leave to appeal.

The original circuit court action then progressed to mediation. ³ Thereafter, the parties filed cross motions for summary disposition, and the court granted DAWC's motion and dismissed the action.

The Court of Appeals affirmed in an unpublished per curiam opinion, holding that if an employee occupies the premises of an employer's business and does not pay rent, then a landlord-tenant relationship does not exist. Accordingly, it declined to address whether DAWC's failure to comply with the thirty-day notice requirement constituted unlawful interference with plaintiff's possessory rights. Plaintiff's application for leave to appeal was granted by this Court. 441 Mich. 880 (1992).

III

Defendant contends that it is an established rule that an employee who occupies premises incidental to his employment is not a tenant, and that the employee loses the right to occupy the premises once the employment is terminated. In Alpine Twp. School Dist. No 11 v. Batsche, 106 Mich. 330, 333, 64 N.W. 196 (1895), a teacher occupying the upper level of a schoolhouse remained in possession of the premises with the school district's permission after the school term ended. This Court held that an employment, and not a landlord-tenant, relationship existed between the parties because there were no terms to the agreement, no rent was reserved, and the purpose of the occupancy was to enable the employee to better serve the employer. However, the Court further held that a tenancy by sufferance may result where the employer acquiesces in the occupancy, regardless of the parties' original relationship. Id. at 334, 64 N.W. 196.

The present case is distinguishable. The court in Batsche found that the plaintiff was a tenant by sufferance, because he was permitted to remain on the premises without having to perform his employment duties. Thus, no "housing in exchange for services" arrangement continued to exist. At no time in the present case, however, did defendant DAWC acquiesce in Grant's possession of the apartment. Furthermore, the employment contract in the present case expressly provided that use and occupancy of the premises were "the sole and full compensation" for the plaintiff's services, the inference being that the plaintiff was paying for the use of the apartment by providing his services as caretaker for defendant DAWC.

In Lane v. Au Sable Electric Co., 181 Mich. 26, 31, 147 N.W. 546 (1914), the chief operator of the defendant's substation and his family occupied a dwelling house as part of his compensation for employment. When the plaintiff went on strike, the defendant notified him to vacate the premises, but he refused. A short time later, the defendant's representatives moved all of the plaintiff's furniture onto the street. This Court held that a landlord-tenant relationship did not exist because the plaintiff was in possession of the defendant's property by virtue of his employment. When the plaintiff chose to strike, his entitlement to the property ceased to exist.

However, plaintiff asserts, and this Court notes, that contrary authority exists in our state and other jurisdictions. In Shaw v. Hill, 79 Mich. 86, 89, 44 N.W. 422 (1889), a third party agreed to keep trespassers off the defendant's land in exchange for occupancy of the land. This Court made clear that

"[r]ent may be reserved in services as well as in money; and if [the employee] agreed to render such services, for the use of the land, he occupied the position of tenant at will to [the employer]."

Plaintiff also points to Munson v. Menominee Co., 371 Mich. 504, 124 N.W.2d 246 (1963), which offers insight through its treatment of the term "rent." There, the plaintiff was employed with the department of social welfare within the county. While the plaintiff attempted to adjust a window shade in her office, the shade fell from its bracket and struck the plaintiff on the head. The defendant claimed governmental immunity, and the issue arose whether the defendant, in furnishing the office space to the state, acted in a proprietary capacity or was engaged in the exercise of a governmental function. In deciding that it was a proprietary function, this Court concluded that rent may be provided in services as well as money, and that the amount of consideration for the lease is not controlling.

"The term 'rent' is defined in 32 Am Jur, Landlord and Tenant, § 428, p 347 as follows:

" 'The word "rent" derives from the Latin word "reditus." In ordinary use, it means the return made by one who occupies real estate under an express or implied contract with the owner, for the occupation of the premises, and is defined broadly as the compensation in money, provisions, chattels, or services, paid or given in exchange for the use and occupancy of real estate.' ...

"Likewise, in 52 CJS, Landlord and Tenant, § 462, p 201, it is said:

" ' "Rent" as the term is employed in the law of landlord and tenant, may be defined as the return, whether of money, service, or specific property, which the tenant makes to the landlord as compensation for the use of the demised premises.' " ⁴

Plaintiff notes that the Court of Appeals in the instant case quickly dismissed two instructive federal cases. In Folgueras v. Hassle, 331 F.Supp. 615, 621 (W.D.Mich., 1971), the defendant owned and operated agriculture labor camps at which housing was a portion of the migrant workers' compensation for labor. ⁵ After the plaintiffs were forcibly removed from the premises, they sought a declaration of their right of access to the camps. The court concluded that the owner of the migrant camp could not lawfully bar access by visitors or representatives of assistance groups seeking entrance to the camps. In so doing, the court concluded that the migrants living in the camp were tenants, and that their tenancy entitled them, their guests, and representatives of assistance organizations to "full rights of ingress and egress to and from their dwellings." Id. at 624. The court noted that a landlord-tenant relationship was present.

"Thus, all the elements of the typical landlord-tenant relationship are present. The migrant pays for the dwelling he occupies; the landlord binds himself to provide a dwelling of a fixed quality; [and] the migrant occupies the dwelling exclusive of the landlord for an agreed upon term--the length of his employment." Id.

In Rodriguez v. Berrybrook Farms, Inc., 672 F.Supp. 1009, 1020 (W.D.Mich., 1...