Hord v. ERIM

• Decision Date: 02 November 1999
• Docket Number: Docket No. 200481.
• Citation: Hord v. ERIM, 601 N.W.2d 892, 237 Mich. App. 95 (Mich. App. 1999)
• Parties: R. Michael HORD, Plaintiff-Appellee, v. ENVIRONMENTAL RESEARCH INSTITUTE OF MICHIGAN d/b/a ERIM, Defendant-Appellant.
• Court: Court of Appeal of Michigan

601 N.W.2d 892

237 Mich. App. 95

R. Michael HORD, Plaintiff-Appellee, v. ENVIRONMENTAL RESEARCH INSTITUTE OF MICHIGAN d/b/a ERIM, Defendant-Appellant.

Docket No. 200481.

Court of Appeals of Michigan.

Submitted April 20, 1999, at Lansing.

Decided August 10, 1999, at 9:10 a.m.

Released for Publication November 2, 1999.

Green, Green, Adams, Palmer & Craig, P.C. (by Philip Green), Ann Arbor, for the plaintiff.

Dickinson Wright PLLC (by Robert W. Powell), Detroit, for the defendant.

Before HOEKSTRA, P.J., and GRIBBS and MURPHY, JJ.

ON REMAND

GRIBBS, J.

This matter has been remanded to us for reconsideration in light of M & D, Inc. v. McConkey, 231 Mich.App. 22, 25, 585 N.W.2d 33 (1998), where a panel of this Court considered the issue of silent fraud. 459 Mich. 954, 590 N.W.2d 576 (1999). We again affirm.

In the case before us, plaintiff alleged both fraudulent misrepresentation and silent fraud. As we noted in our previous opinion, 228 Mich.App. 638, 641, n. 1, 579 N.W.2d 133 (1998), "fraudulent misrepresentation" denotes a standard fraud claim based on an affirmative statement, while "silent fraud" involves a failure to disclose information where there is a duty to do so. We specifically held that, in this case, plaintiff presented sufficient evidence of an affirmative misrepresentation to support the jury verdict on plaintiff's claim of fraudulent misrepresentation. Because we concluded that the trial court properly denied defendant's motion for a directed verdict on this basis, the question of silent fraud was never raised or relied on in the majority opinion. We remain convinced that the trial court properly found evidence of fraudulent misrepresentation in this case, and this Court's decision in M & D, Inc., supra, does not change that previous finding.

Having nonetheless reviewed this matter in light of our Supreme Court's remand, we find that the evidence here also supported plaintiff's silent fraud theory. As this Court stated in M & D, Inc., supra at 29, 585 N.W.2d 33, quoting and adopting Judge Young's opinion in the previous M & D, Inc. v. McConkey, 226 Mich.App. 801, 573 N.W.2d 281 (1997), defendant "also has a duty to disclose `"subsequently acquired information which he recognizes as rendering untrue, or misleading, previous representations which, when made, were true or believed to be true."`" 231 Mich.App. at 29, 585 N.W.2d 33. (Citations and emphasis omitted.)

We remain convinced that the jury in this case could fairly infer that defendant showed plaintiff the 1991 operating summary with the intention that plaintiff would rely on the information it contained. 228 Mich.App at 642-643, 579 N.W.2d 133. Therefore, in addition to finding that the evidence here supports a claim of simple fraud, we also find that defendant had a duty in this case to disclose the subsequently acquired information of defendant's financial position in 1992, which clearly rendered untrue any implications from the 1991 figures.

Affirmed.

MURPHY, J., concurred.

HOEKSTRA, P.J. (dissenting)).

Consistent with the remand order, I have reconsidered my opinion in light of M & D, Inc. v. McConkey, 231 Mich.App. 22, 585 N.W.2d 33 (1998). In my judgment, McConkey supports the conclusions I reached in my original dissent, and, consequently, I remain convinced that the trial court's judgment should be reversed. Therefore, I respectfully dissent.

Here, plaintiff does not claim that defendant's 1991 operating summary contained false or misleading information regarding the company's financial status as of 1991. Thus, standing alone, the summary provides no support for plaintiff's claims, because it accurately presents the 1991 figures. Plaintiff inferred from the 1991 financial figures that the company's situation remained unchanged through 1992. This inference, when coupled with a failure by defendant to disclose more current information, provides the basis for plaintiff's allegation of fraud. Id. at 29, 585 N.W.2d 33. However, I understand McConkey to hold that plaintiff's inference is unwarranted; therefore it cannot serve as the basis for his fraud claim. There is no evidence that defendant intended the 1991 operating summary to demonstrate the company's financial condition at the time it hired plaintiff. To the contrary, the document is clearly a report from fiscal year 1991, and any other inferences plaintiff may have made lack a discernible or objective basis. In addition, I see no basis for the conclusion that plaintiff had a right to rely on the 1991 summary as an accurate picture of the company's performance in fiscal year 1992, without some additional inquiry or affirmative representation by defendant. Both of these conclusions, that the 1991 figures were intended to represent financial performance in 1992 and that defendant had a duty to provide additional financial information, are essential to the majority's finding of fraud. Unfortunately, no...