International Union United Auto. Workers of America v. Wood

• Decision Date: 08 June 1953
• Docket Number: J,No. 46,46
• Parties: INTERNATIONAL UNION UNITED AUTOMOBILE WORKERS OF AMERICA v. WOOD et al. anuary term.
• Court: Michigan Supreme Court

Page 60

59 N.W.2d 60

337 Mich. 8

INTERNATIONAL UNION UNITED AUTOMOBILE WORKERS OF AMERICA v. WOOD et al.

No. 46, January term.

Supreme Court of Michigan.

June 8, 1953.

Wunsch & Coleman, Battle Creek, for appellant.

Sheldon Rupert, Paw Paw, for appellee Jack Ely.

John Verdonk, Bangor, for appellees Willard Kime and Oscar Getz.

Before the Entire Bench.

BUSHNELL, Justice.

Plaintiff Union's appeal is from two orders denying its motions to add Willard Kime, Jack Ely and Oscar Getz as parties defendant.

On October 25, 1950, defendant Phil Wood, doing business as The Bangor Advance, published in his newspaper a fullpage advertisement which contained the statement: 'This ad paid for by the Bangor Citizens' Committee.' The Union deemed this advertisement to be libelous. The text of the advertisement does not appear in the record, and the matter of whether it was libelous is not before us. On April 13, 1951, plaintiff began an action against Wood for damages in the sum of $5,000. This action was commenced by a summons, accompanied by a motion for 'pre-trial examination and for discovery of books and papers.' Wood filed his objection to the motion and entered his special appearance, together with a motion to quash the service of process.

The questions raised were argued and briefed and, on August 22, 1951, the circuit judge filed a memorandum opinion and an order denying the motion to quash and granting the motion directing that Wood disclose the names and addresses of the sponsors of the advertisement. Further proceedings were stayed until compliance with or vacation of the order. Wood's application for leave to appeal from this order was denied here on October 5, 1951.

Wood complied with the order on October 15th by disclosing that the sponsors were himself, Kime, Ely and Getz. Summonses were then issued and served upon the three last named persons. Ely appeared specially and moved to quash the summons. Kime and Getz later filed a special appearance and a motion to dismiss. On November 29th plaintiff filed a motion to order the addition of Kime, Ely and Getz as parties defendant. On March 27th the trial judge filed a memorandum opinion in which he held that the one-year statute of limitations, C.L.1948, § 609.13, Stat.Ann. § 27.605, had run against the plaintiff. Orders of dismissal as to Ely, Kime and Getz followed.

Among the questions raised here the de cisive one is whether the so-called fraudulent concealment statute, C.L.1948, § 609.20, Stat.Ann. § 27.612, includes within its scope the concealment of a party defendant. This section reads:

'If any person who is liable to any of the actions mentioned in this chapter shall fraudulently conceal the cause of such action from the knowledge of the person entitled thereto, the action may be commenced at any time within 2 years after the person who is entitled to bring the same shall discover that he had such cause of action, although such action would be otherwise barred by the provisions of this chapter.'

The trial judge held that, if the advertisement complained of should be held to be libelous, there can be no doubt that the cause of action, because of such libel, came into being when the publication was made. He pointed out that the meaning of the words and phrases complained of were then known by the plaintiff and that the 'force and meaning of such words and phrases would be as libelous upon the publication as they would six months or one year afterwards.' The name of the editor and publisher of the newspaper was then known, and plaintiff's action was begun against him within the one-year period. If that period is to be extended in order to include Ely, Kime and Getz as added defendants, proof must be produced of a fraudulent concealment of the cause of action.

The Union argues that the concealment of the names of sponsors who are proper parties defendant is a fraudulent concealment of a cause of action and, therefore, plaintiff is entitled to the benefit of the two-year statutory extension period. Testimony produced by the Union shows that every reasonable effort was made to ascertain the identity of the sponsors of the advertisement. When Wood's attorney was asked, in writing, to disclose these names, he replied by a letter which contained the single word 'Why?' When advised as to the reason for the request, counsel replied that he could not advise a client to open his personal files, and he knew of no requirement that imposed a duty upon Wood to so disclose.

It is apparent that the Union's extensive inquiry in the community, including conversations with Wood, was fruitless and that it was impossible to obtain the names of the sponsors until after the court ordered disclosure by Wood. The required information was not obtained by plaintiff until 10 days prior to the expiration of the one year period following the date of publication. Summonses for Kime, Ely and Getz, however, were not issued until November 8th, which was 14 days after the statutory period of one year had expired. Even then Kime, Ely and Getz could not be added as parties defendant until a court order had been obtained. C.L.1948, § 612.13, Stat.Ann. § 27.665.

Questions of concealment and diligence are questions of fact. Groendal v. Westrate, 171 Mich. 92, 96, 137 N.W. 87. Fraudulent concealment was defined in DeHaan v. Winter, 258 Mich. 293, 296, 241 N.W. 923, 924, as meaning the

'employment of artifice, planned to prevent inquiry or escape investigation, and mislead or hinder acquirement of information disclosing a right of action. The acts relied on must be of an affirmative character and fraudulent.'

Our inquiry, therefore, is: What were the affirmative acts and who perpetrated a fraud?

Fraudulent concealment is more than mere silence. McNaughton v. Rockford State Bank, 261 Mich. 265, 268, 246 N.W. 84. See, also, Schram v. Burt, 6 Cir., 111 F.2d 557. No fiduciary relationship existed between the Union and Wood, as was alleged and denied in Dowse v. Gaynor, 155 Mich. 38, 42, 118 N.W. 615. See also, Stetson v. French, 321 Mass. 195, 72 N.E.2d 410, 173 A.L.R. 569, and authorities annotated beginning on page 578.

Plaintiff here cannot be said to have been guilty of a lack of diligence as was indicated in Barry v. Detroit Terminal Railway Co., 307 Mich. 226, 11 N.W.2d 867. Concealment of the parties has been held not to constitute a concealment of a cause of action. Staples v. Zoph, 9 Cal.App.2d 369, 49 P.2d 1131; Griffith v. Shannon, Tex. Civ.App., 1926, 284 S.W. 598; 173 A.L.R. 584; 54 C.J.S., Limitations of Actions, § 206, page 224.

It is argued that Wood was the agent of Ely, Kime and Getz in preparing the text of the advertisement. Even if Wood was only an agent for undisclosed principals, he, nevertheless, is liable. An agent is liable for his acts on behalf of his undisclosed principal. Pollasky v. Minchener, 81 Mich. 280, 46 N.W. 5, 9 L.R.A. 102.

'An agent is not exempt from liability for a fraud knowingly committed on behalf of a principal, even though the agent receives no personal benefit from the fraud, and the principal is at the bottom of it.' (Syllabus) Weber v. Weber, 47 Mich. 569, 11 N.W. 389.

Nor is mere concealment of the agency such fraud as would toll the statute of limitations. Owen v. King, 130 Tex. 614, 111 S.W.2d 695, 114 A.L.R. 859, and Gibson v. Jensen, 48 Utah 244, 158 P. 426. Concealment by one other than the one sought to be charged is not within the prohibition of the statute. See Stevenson v. Robinson, 39 Mich. 160.

The concealment in Unemployment Compensation Commission v. Vivian, 318 Mich. 598, 29 N.W.2d 102, arose through the mistake of the defendants as to the application of the unemployment compensation act to their business. Vivian, the defendant employer, was held liable, notwithstanding his mistaken concept of the law, as to contributions falling due less than 60 years prior to the commencement of the action against him. The action was brought by the commission after the running of the statute of limitations as extended by a period of 2 years following discovery of the concealment of the cause of action as to other contributions, which concealment was determined to have been fraudulent. The concealment in that case was of a cause of action and not of the party defendant.

Here, there is no proof that Wood concealed a cause of action against himself or others. There is no proof of any relationship with or towards the Union which required Wood to disclose the names of his associates. The ends of justice do not require the addition of parties defendant after the running of the statute of limitations, unless it has been tolled. See C.L.1948, § 612.13, Stat.Ann. § 27.665. The argument that amendments as to the parties may be made at any stage of the proceedings under the provisions of C.L.1948, § 616.1, Stat.Ann. § 27.838, overlooks the fact that no proceedings were pending against Ely, Kime and Getz at the time the motion was made, and that the statute of limitations had then run as to them.

The order of the trial judge is affirmed, with costs to appellees in this court. Costs in the trial court shall abide the outcome of the principal case.

DETHMERS, C. J., and BUTZEL, CARR, SHARPE, BOYLES, and REID, JJ., concurred with BUSHNELL, J.

ADAMS, Justice (dissenting).

I cannot agree with the conclusion of Justice BUSHNELL that there has been no fraudulent concealment of a cause of action as contemplated by C.L.1948, § 609.20, Stat.Ann. § 27.612. The term 'cause of action' means more than a known injury or a violation of a right. It must also include the identity of the person who is responsible for the injury or the violation. Damage or injury...