McClements v. Ford Motor Co., No. 126276. Calendar No. 9.

• Decision Date: 26 July 2005
• Docket Number: No. 126276. Calendar No. 9.
• Citation: 702 N.W.2d 166,473 Mich. 373
• Parties: Milissa McCLEMENTS, Plaintiff-Appellee/Cross-Appellant, v. FORD MOTOR COMPANY, Defendant-Appellant/Cross-Appellee.
• Court: Michigan Supreme Court

702 N.W.2d 166

473 Mich. 373

Milissa McCLEMENTS, Plaintiff-Appellee/Cross-Appellant, v. FORD MOTOR COMPANY, Defendant-Appellant/Cross-Appellee.

No. 126276. Calendar No. 9.

Supreme Court of Michigan.

Argued April 13, 2005.

Decided July 26, 2005.

As Amended on Denial of Rehearing September 23, 2005.

Scheff & Washington, P.C. (by George B. Washington and Miranda K.S. Massie), Detroit, MI, for the plaintiff.

Kienbaum Opperwall Hardy & Pelton, P.L.C. (by Elizabeth Hardy and Julia Turner Baumhart) (Patricia J. Boyle, of counsel), Birmingham, MI, for Ford Motor Company.

OPINION

MARKMAN, J.

We granted leave to appeal in this case to resolve two questions: (1) whether a common-law claim of negligent retention can be premised on sexual harassment in light of the remedies provided by the Civil Rights Act (CRA), M.C.L. § 37.2101 et seq.; and (2) whether an employer can be held liable under the CRA for sexual harassment against a non-employee. The trial court granted summary disposition to defendant on both issues, ruling that there was insufficient notice to Ford to support the negligent retention theory, and that plaintiff could not pursue a claim under the CRA without demonstrating at least a "quasi-employment" relationship. The Court of Appeals affirmed with respect to the CRA claim, but reversed with respect to plaintiff's negligent retention claim. We hold that: (1) a common-law claim for negligent retention cannot be premised upon workplace sexual harassment; and (2) because plaintiff has failed to establish a genuine issue of material fact that defendant affected or controlled a term, condition, or privilege of her employment, she cannot bring a claim against defendant under the CRA. Accordingly, we affirm in part and reverse in part the judgment of the Court of Appeals, and reinstate the trial court's order of summary disposition in favor of defendant.

I. FACTS AND PROCEDURAL HISTORY

Defendant Ford Motor Company hired AVI Food Systems to operate three cafeterias at its Wixom assembly plant. Plaintiff Milissa McClements was hired by AVI as a cashier at the Wixom plant in March 1998.¹ Plaintiff testified that Daniel Bennett, then a superintendent in the predelivery department of the plant, had in November 1998² invited her on "three or four" occasions to meet him at a local fast food restaurant. On each occasion, plaintiff rebuffed his invitation. According to plaintiff, Bennett "seemed very persistent, like he didn't understand that I wasn't interested." Plaintiff acknowledged that, at this point, Bennett was polite, and there was no testimony that he used sexual or foul language. Bennett denies making any such invitations.

Plaintiff described two additional encounters with Bennett that occurred during this same time period. During the first of these encounters, Bennett allegedly entered the cafeteria while it was closed, and approached plaintiff from behind. Plaintiff testified that "I was facing the opposite way. He came up and just grabbed me and turned me around and stuck his tongue in my mouth." After "a few days," plaintiff allegedly had a second encounter with Bennett in the closed cafeteria. According to plaintiff, Bennett again grabbed her from behind, attempted to stick his tongue in her mouth, and stated, "Come on, I know you want it. Isn't there somewhere we can go and have sex?" Plaintiff refused this advance, and Bennett left the cafeteria. Plaintiff allegedly reported the incidents to her union steward, but claims that she was advised that if she reported the incident to defendant, it would "turn around and stab you in the back and you [would] end up losing your job." Plaintiff did not report the incident to either defendant or AVI until the instant lawsuit was filed.

In 2000, plaintiff was approached by another Ford employee, Justine Maldonado,³ who claimed that she had also been sexually harassed by Bennett. Specifically, Maldonado claimed that in January or February 1998, Bennett exposed himself to her and demanded oral sex in the parking lot of the Wixom plant. Bennett also allegedly followed Maldonado in his car, got out after she had stopped at a floral shop, and reached into her car and tugged on her blouse. In late-October 1998, Maldonado told Joe Howard, her uncle and a production manager at Wixom, about the incidents.⁴ During "the last couple days" in October, Maldonado told David Ferris, a former Ford superintendent who was on temporary assignment to her union, about the incidents. Maldonado testified that she spoke with Ferris just before undergoing knee surgery on November 2, 1998. Ferris testified that "two or three days" later, he confronted Bennett about Maldonado's accusations. The next day, Ferris informed Jerome Rush, Wixom's director of labor relations, about the alleged incidents of sexual harassment. Ferris testified that the conversation lasted a minute "at the most." Rush allegedly told Ferris that he "need not be involved in these types of issues" and took no further action.

Even after learning of the Maldonado incidents, plaintiff did not come forward with her allegations. However, plaintiff's attitude changed after Maldonado informed her in August 2001 that Bennett had exposed himself to three teenage girls. In 1995, Bennett was convicted of misdemeanor indecent exposure, for exposing himself to three teenage girls on I-275 while he was driving a company car. Defendant was aware of the incident, because the police determined Bennett's identity by tracing the car through Ford.⁵

After learning about the indecent exposure arrest and conviction, plaintiff filed the instant lawsuit in September 2001. Plaintiff claimed that defendant: (1) negligently retained Bennett, whom it knew had a propensity to sexually harass women; and (2) breached its obligation under the CRA to prevent Bennett from sexually harassing her.

The trial court granted defendant's motion for summary disposition. First, the trial court found that there was no evidence that defendant knew of Bennett's propensity to sexually harass women in the workplace. Maldonado's complaints to her uncle and friend were not sufficient to give defendant notice of Bennett's sexually harassing behavior and the 1995 conviction alone is insufficient to establish that propensity. Thus, defendant could not be held liable under the negligent retention theory. Second, the trial court found that plaintiff as a nonemployee could not hold defendant liable under the CRA. However, even if defendant were potentially liable under the CRA, it could not be held liable under these circumstances, because its higher management was never made aware of the allegedly sexually harassing behavior. In an unpublished opinion, the Court of Appeals affirmed in part and reversed in part the judgment of the trial court. Unpublished opinion per curiam of the Court of Appeals, issued April 22, 2004 (Docket No. 243764), 2004 WL 868255. The Court of Appeals held that defendant's knowledge of the indecent exposure arrest and Maldonado's allegations created a genuine issue of material fact whether defendant "knew or should have known of Bennett's sexually derogatory behavior toward female employees." However, the Court of Appeals also applied the "economic reality test," Ashker v. Ford Motor Co., 245 Mich.App. 9, 14, 627 N.W.2d 1 (2001), and held that defendant was not plaintiff's employer. As a result, the Court of Appeals concluded that plaintiff could not maintain a CRA complaint against an entity that is not her employer. This Court granted defendant's application for leave to appeal, as well as plaintiff's application for leave to file a cross-appeal. 471 Mich. 937, 690 N.W.2d 99 (2004).

II. STANDARD OF REVIEW

We review de novo the grant or denial of a motion for summary disposition. Kreiner v. Fischer, 471 Mich. 109, 129, 683 N.W.2d 611 (2004). A motion under MCR 2.116(C)(10) tests the factual support of a plaintiff's claim. Spiek v. Dep't of Transportation, 456 Mich. 331, 337, 572 N.W.2d 201 (1998). Summary disposition is only permitted if the evidence, while viewed in a light most favorable to the plaintiff, fails to establish a claim as a matter of law. Wilkinson v. Lee, 463 Mich. 388, 391, 617 N.W.2d 305 (2000). We review de novo the questions whether the CRA displaces a common-law claim for negligent retention based upon sexual harassment in the workplace and whether an employer can be held liable under the CRA for sexual harassment against a nonemployee because they are questions of law. Morales v. Auto-Owners Ins. Co. (After Remand), 469 Mich. 487, 490, 672 N.W.2d 849 (2003).

III. ANALYSIS

The issue in this case is not whether Bennett has engaged in reprehensible conduct either inside or outside the workplace. Rather, the issues are: (1) whether defendant negligently retained Bennett as a supervisor as of the time Bennett allegedly sexually harassed plaintiff, despite the fact that it knew or should have known of his propensity to sexually harass women; and (2) whether defendant is responsible under the CRA for failing to prevent sexual harassment of plaintiff even though plaintiff was not a direct employee of defendant.

A. NEGLIGENT RETENTION CLAIM

Plaintiff's first theory is that defendant negligently retained Bennett as a supervisor after learning of his propensity to sexually harass women. In general, an employer is not responsible for an intentional tort in the workplace committed by its employee acting outside the scope of employment. Martin v. Jones, 302 Mich. 355, 358, 4 N.W.2d 686 (1942). However, this Court has previously recognized an exception to this general rule of liability when the employer "`knew or should have known of his employee's propensities and criminal record before commission of an intentional tort by [that] employee . . . .'" Hersh v. Kentfield Builders, Inc., 385 Mich. 410, 412, 189 N.W.2d 286 (1971) (citation omitted). Plaintiff argues that defendant knew of Bennett's "propensity" to engage in...