Lothian v. City of Detroit

• Citation: 414 Mich. 160,324 N.W.2d 9
• Decision Date: 13 September 1982
• Docket Number: Docket No. 64875,No. 7,7
• Parties: Robert A. LOTHIAN, Plaintiff-Appellee, v. CITY OF DETROIT, Board of Trustees, Policemen and Firemen Retirement System, Defendant-Appellant. Calendar
• Court: Supreme Court of Michigan

Page 9

324 N.W.2d 9

414 Mich. 160

Robert A. LOTHIAN, Plaintiff-Appellee, v. CITY OF DETROIT, Board of Trustees, Policemen and Firemen Retirement System, Defendant-Appellant.

Docket No. 64875.

Calendar No. 7.

Supreme Court of Michigan.

Argued May 6, 1981.

Decided Sept. 13, 1982.

Donald A. Calkins, Taylor, for plaintiff-appellee.

Sylvester Delaney, Deputy Corp. Counsel, William Dietrich, Michael A. Hurvitz, Asst. Corp. Counsels, Detroit, for defendant-appellant.

COLEMAN, Chief Justice.

In this case, we are asked to decide whether plaintiff's claim for accrued retirement benefits, filed long after the applicable statutory period of limitations had expired, is barred. We hold that plaintiff's claim is barred. Accordingly, we reverse.

I

In 1962, plaintiff Robert Lothian, ¹ a veteran member of the Detroit police force, decided to retire. Shortly before his retirement, plaintiff was offered the appointive civilian position of Second Deputy Police Commissioner. Plaintiff accepted the offer. On August 7, 1962, he communicated with the city's Policemen and Firemen Retirement System to process the necessary papers for his retirement, which was scheduled to take place later that month. At that time, Peter Zylich, the secretary of the board of trustees of the retirement system, informed plaintiff that city policy prohibited persons collecting a salary from the city from simultaneously receiving city-paid pension benefits. Plaintiff was told that he would have to waive his pension benefits for the duration of his civilian employment with the city as Second Deputy Police Commissioner. Plaintiff executed the waiver on August 7. ² Plaintiff retired from the police force on August 16, 1962. On September 21, 1962, he received his appointment as Second Deputy Commissioner, a capacity in which he served until his retirement in August, 1967.

The catalyst in this case was the Court of Appeals issuance, on June 25, 1973, of its opinion in Van Antwerp v. Detroit, 47 Mich.App. 707, 210 N.W.2d 3 (1973). ³ The facts of the Van Antwerp case are facially similar to those in the case at bar. There, a pensioner of the City of Detroit had been required to execute a waiver of his pension benefits after his election to the Detroit Common Council because of the same city policy asserted in the instant case. The Court of Appeals determined that the city could not lawfully change the manner in which it administered pension benefits without first amending the Detroit City Charter. The Court additionally held that Mr. Van Antwerp's waiver was invalid because it did not contemplate a voluntary relinquishment of a known right.

Plaintiff, recognizing a parallel between his situation and that of Mr. Van Antwerp, by letter dated November 14, 1973, demanded voluntary payment of those pension benefits which the retirement system had withheld from him during his tenure as Second Deputy Commissioner. The board of trustees denied his request on January 24, 1974.

On May 8, 1974, plaintiff instituted the present action in the Wayne Circuit Court, alleging that defendants unlawfully withheld $21,247.71 in pension benefits due him, and requesting that mandamus issue against defendants. After an abbreviated ⁴ trial, the trial court issued a judgment granting mandamus and ordering defendants to pay to plaintiff all pension benefits withheld during his civilian service.

On March 7, 1980, the Court of Appeals affirmed in an unpublished per curiam opinion. ⁵ This Court granted defendants' application for leave to appeal on November 20, 1980, 409 Mich. 946 (1980).

II

Because the instant case is addressed to the interplay between the equitable doctrine of laches and its counterpart at law, the statute of limitations, we pause briefly to examine the traditional roles of these two doctrines.

A statutory limitations period represents a legislative determination of that reasonable period of time that a claimant will be given in which to file an action. A statute of limitations is a statute of presumption. The fact of " 'delay extending to the limit prescribed' ", without further proof, " 'is itself a conclusive bar' " to suit, Ramsey v. Child, Hulswit & Co., 198 Mich. 658, 671, 165 N.W. 936 (1917). ⁶ Although at one time limitations provisions were looked upon with disfavor because of the harsh results worked by their application, ⁷ the modern view treats them as statutes of repose, McKisson v. Davenport, 83 Mich. 211, 47 N.W. 100 (1890), and as "wise and beneficial" ⁸ laws common to " 'all systems of enlightened jurisprudence' ". Ramsey, supra, 198 Mich. at 671, 165 N.W. 936. In general, statutes of limitations are regarded as procedural, not substantive, in nature. Forest v. Parmalee, 402 Mich. 348, 359, 262 N.W.2d 653 (1978); Buscaino v. Rhodes, 385 Mich. 474, 189 N.W.2d 202 (1971). ⁹ The statute of limitations is assertable as a "perfectly righteous * * * meritorious" affirmative defense. Bigelow v. Walraven, 392 Mich. 566, 570, 221 N.W.2d 328 (1974); GCR 1963, 111.7.

Limitations periods created by statute are grounded in a number of worthy policy considerations. They encourage the prompt recovery of damages, Buzzn v. Muncey Cartage Co., 248 Mich. 64, 67, 226 N.W. 836 (1929); they penalize plaintiffs who have not been industrious in pursuing their claims, First National Bank of Ovid v. Steel, 146 Mich. 308, 109 N.W. 423 (1906); they "afford security against stale demands when the circumstances would be unfavorable to a just examination and decision", Jenny v. Perkins, 17 Mich. 28, 33 (1868); they relieve defendants of the prolonged fear of litigation, Bigelow, supra, 392 Mich. at 576, 221 N.W.2d 328; they prevent fraudulent claims from being asserted, Bailey v. Glover, 88 U.S. (21 Wall.) 342, 22 L.Ed.2d 636 (1875); and they " 'remedy * * * the general inconvenience resulting from delay in the assertion of a legal right which it is practicable to assert' ". Lenawee County v. Nutten, 234 Mich. 391, 396, 208 N.W. 613 (1926).

There is a maxim in law "that nothing can interrupt the running of the statute of limitation", Klass v. Detroit, 129 Mich. 35, 39, 88 N.W. 204 (1901). However, exceptions to this tenet have been developed by both the courts and the Legislature. Under certain circumstances, e.g., for the duration of a claimant's personal disability (and perhaps for a specified time thereafter), M.C.L. Sec. 600.5851; M.S.A. Sec. 27A.5851, the running of the applicable statute of limitations may be suspended. Similarly, this affirmative defense may be waived by failure to plead it, by express agreement not to assert it, or by conduct which estops the defendant from interposing it. See Kibbey v. Gordon Mfg. Co., 260 Mich. 531, 245 N.W. 512 (1932); Klass, supra; Renackowsky v. Board of Water Comm'rs of Detroit, 122 Mich. 613, 81 N.W. 581 (1900); Voorheis v. People's Mutual Benefit Society of Elkhart, Indiana, 91 Mich. 469, 51 N.W. 1109 (1892); Allen v. Conklin, 112 Mich. 74, 70 N.W. 339 (1897); 51 Am Jur 2d, Limitation of Actions, Secs. 422-452, pp. 894-914.

Laches, ¹⁰ the corresponding judicially-imposed equitable principle, denotes "the passage of time combined with a change in condition which would make it inequitable to enforce a claim against the defendant." Tray v. Whitney, 35 Mich.App. 529, 536, 192 N.W.2d 628 (1971). The doctrine of laches reflects "the exercise of the reserved power of equity to withhold relief otherwise regularly given where in the particular case the granting of such relief would be unfair and unjust." Walsh, Equity, Sec. 102, p. 472. Laches differs from the statutes of limitation in that ordinarily it is not measured by the mere passage of time, Smith v. Sprague, 244 Mich. 577, 222 N.W. 207 (1928); Chamski v. Wayne County Board of Auditors, 288 Mich. 238, 284 N.W. 711 (1939); Chesnow v. Nadell, 330 Mich. 487, 47 N.W.2d 666 (1951). Instead, when considering whether a plaintiff is chargeable with laches, we must afford attention to prejudice occasioned by the delay. As a general rule, "[w]here the situation of neither party has changed materially, and the delay of one has not put the other in a worse condition, the defense of laches cannot * * * be recognized." Walker v. Schultz, 175 Mich. 280, 293, 141 N.W. 543 (1913). Simply stated, "laches [is concerned] with the effect of delay", while "limitations are concerned with the fact of delay". Sloan v. Silberstein, 2 Mich.App. 660, 676, 141 N.W.2d 332 (1966). Like its legal counterpart, laches is pled as an affirmative defense. Chippewa County Board of Supervisors v. Bennett, 185 Mich. 544, 152 N.W. 229, 153 N.W. 814 (1915).

Although laches is recognized as a doctrine independent from the statute of limitations, both in its development and in its conceptualization, in certain cases arising in equity courts have readily resorted to a particular technique by which they apply statutory limitations provisions "by analogy":

"[T]here has been a strong tendency to apply by analogy the corresponding limitation at law fixed by statute upon corresponding legal actions, and to hold that delay beyond that period will bar the action in equity without much attention to whether an important change in the position of the parties has taken place or not." Walsh, Equity, Sec. 102, p 474.

See, also, Young v. Young, 200 Mich. 236, 167 N.W. 23 (1918); Brown v. Harrison, 242 Mich. 603, 219 N.W. 606 (1928). As suggested by the excerpt above, judicial inclination to apply limitations provisions by analogy is limited to those cases in which the law provides relief analogous to that awardable in chancery. "Equity follows the analogies of the law in all cases where an analogous relief is sought upon a similar claim." Michigan Ins. Co. of Detroit v. Brown, 11 Mich. 265, 272 (1863). See, also, People ex rel. Attorney General v. Michigan Central R. Co., 145 Mich. 140, 145, 108 N.W. 772 (1906); Campau v. Chene, 1 Mich. 400 (1850); Jenny, supra. The reason underlying this "by analogy" technique is...