Nagele-Kelly Mfg. Co. v. Hannak

• Decision Date: 25 September 1968
• Docket Number: Docket No. 3037,NAGELE-KELLY,No. 1,1
• Citation: 164 N.W.2d 540,13 Mich.App. 427
• Parties: , 53 A.L.R.3d 658 MANUFACTURING COMPANY, an Ohio corporation, and Aetna Insurance Company, a foreign corporation, subrogee of Nagele-Kelly Manufacturing Company, Plaintiffs-Appellees, v. Joan Marie HANNAK, Defendant-Appellant
• Court: Court of Appeal of Michigan — District of US

Page 540

164 N.W.2d 540

13 Mich.App. 427, 53 A.L.R.3d 658

NAGELE-KELLY MANUFACTURING COMPANY, an Ohio corporation, and Aetna Insurance Company, a foreign corporation subrogee of Nagele-Kelly Manufacturing Company, Plaintiffs-Appellees, v. Joan Marie HANNAK, Defendant-Appellant.

Docket No. 3037.

Court of Appeals of Michigan, Division No. 1.

Sept. 25, 1968.

Leave to Appeal Denied Jan. 15, 1969.

Released for Publication Feb. 14, 1969.

Joseph Zanglin, Becker, Mitchell, Phillips, Zanglin & Vann, Detroit, for appellant.

Michael J. Kelly, Detroit, for appellees.

Before LEVIN, P.J., and BURNS and DELTON, ^* JJ.

LEVIN, Judge.

An automobile owned by the plaintiff Nagele-Kelly Manufacturing Company collided with one driven by the defendant Joan Marie Hannak. The Nagele-Kelly automobile was being driven on its business by one of its employees.

The trial judge, who sat without a jury, found both drivers negligent. After reading Universal Underwriters Insurance Company v. Hoxie (1965), 375 Mich. 102, 133 N.W.2d 167, the judge concluded Nagele-Kelly was guilty of contributory negligence because its driver's negligence must be imputed to it. A judgment of no cause of action was entered denying Nagele-Kelly recovery for damages to its property alleged to have been suffered in the collision.

Within 20 days after entry of the judgment Nagele-Kelly moved to amend the judgment pursuant to GCR 1963, 527.5. At the hearing on the motion to amend judgment, the trial judge decided his first reading of Universal Underwriters was erroneous, and that correctly interpreted that decision holds: 'that an employer may not be held responsible for the negligent acts of his employee, unless he has actual control over the driving of the employee.' ¹ The original judgment was thereupon set aside and judgment was entered in favor of Nagele-Kelly for damages caused its property by the collision. We think the trial judge was right to first time and, accordingly, reverse.

The doctrine of imputed contributory negligence has a bad reputation and has been abrogated in most applications, both in this State and elsewhere. Nevertheless, a majority of our Supreme Court has refused to abolish the doctrine altogether. In Universal Underwriters, 4 justices stated (pp. 110, 112, 133 N.W.2d p. 170) that Bricker v. Green (1946), 313 Mich. 218, 21 N.W.2d 105, 163 A.L.R. 697, did not abolish the doctrine of imputed negligence, 'rather it repudiated the doctrine as it has previously been applied in actions by a blameless passenger against a third party.' One justice concurred in the result, ² but did not sign any of the 2 concurring and 1 dissenting opinions. While 3 justices were prepared to hold the doctrine altogether abolished, we are satisfied a majority of the Court has not yet been mustered to achieve that result. The opinions signed by a majority of the Court in Universal Underwriters retain for Michigan the imputed contributory negligence doctrine at least for the kind of case here presented--an action by an employer against a third party for Property damage suffered as a result of the servant's and the third party's negligence.

Just 4 years ago the American Law Institute, while generally rejecting the imputed contributory negligence doctrine, ³ readopted its prior statement concerning the doctrine's application to actions by an employer:

'A master is barred from recovery against a negligent defendant by the negligence of his servant acting within the scope of his employment.' Restatement, Second, Torts, § 486

Prosser stated in the third edition of his work, Prosser on Torts, published in 1964, that while the doctrine of imputed contributory negligence has been largely abolished where the agency is fictitious, i.e., driver-passenger, husband-wife, bailorbailee,

'if the plaintiff and the third person stand in such a relation to one another--as for example that of master and servant--that the plaintiff will be charged with that person's negligence as a defendant, it will ordinarily follow that he will likewise be charged with it as a plaintiff.' Prosser, Law of Torts (3d ed.) p. 501.

Prosser goes on to observe (p. 501) that 'there may be special reasons of policy in particular cases which will lead to the imputation of the negligence to a defendant, but not to a plaintiff.' Professors Harper and James wrote favorably of those cases which refused to apply the doctrine to bar recovery by a vicariously liable automobile owner on account of the negligence of one operating the owner's car with his express or implied consent. Harper and James, The Law of Torts, § 23.6, pp. 1274, 1275. ⁴

Michigan is aligned with those States which do not allow imputation of the driver's negligence to the vicariously liable Owner. ⁵ Thus, the negligence of Nagele-Kelly's driver may not be imputed to it on account of its vicarious liability under the owner liability statute.

However, it does not necessarily follow that the driver's negligence may not be imputed to Nagele-Kelly as the driver's Employer in this action to recover property damage. It has been suggested by respectable authority there may be valid policy reasons for continuing to impute to the employer the negligence of his employee in a suit by the employer for Property damage. ⁶ We are persuaded that the Michigan Supreme Court has declined to abolish application in such a case of the imputed contributory negligence doctrine.

This brings us to Weber v. Stokely-Van Camp, Inc. (1966), 274 Minn. 482, 144 N.W.2d 540, a case heavily relied on by Nagele-Kelly, the plaintiff-employer in this case. Weber holds that an employee-driver's negligence is not imputable to a plaintiff-employer seeking recovery for Injuries sustained while a passenger in an automobile driven by his employee. While the court criticized the doctrine of imputed contributory negligence in general, it limited its holding to the factual situation there presented, a factual situation different from the one presently at hand.

If this were an action by an employer-passenger against a third party for personal injuries suffered as a result of the negligence of the third party and of his employee, we might, like the Weber court, conclude that our Supreme Court did not intend by its statements in Universal Underwriters to bar recovery in such a case on the basis of imputed contributory negligence. ⁷ We are not, however, confronted with an action by a personally injured employer-passenger but rather one by an employer who seeks recover for Property damage. The doctrine of imputed contributory negligence still operates to bar recovery by an employer in such a case. who seeks recovery for Property 91 N.W.2d 485, held that a husband could, without regard to his wife's negligence, recover from a third party for injuries suffered in a collision between the third party's car and one owned by the husband and his wife, the latter's car being operated by the wife at the time of the collision.

Our conclusion makes it unnecessary for us to decide whether the trial judge had the power to grant Nagele-Kelly's motion to Amend the judgment first entered against it. While we are inclined to the view that a common pleas judge is empowered to enter the modifying order here entered, ⁸ the attention of the legislature and Supreme Court is directed to the matter. The common pleas court is an important court exercising jurisdiction over a wide range of cases and there should be no doubt that it enjoys the same power to correct its own errors of judgment as does the circuit court.

Reversed and remanded for the entry of judgment of no cause for action. Costs to appellant.

* JOHN C. DALTON, Circuit Judge for the County of Jackson, appointed by the Supreme Court for the hearing month of May, 1968, pursuant to § 306 P.A.1964, No. 281.

1 It has not been asserted Nagele-Kelly had actual control of its employee's driving at the time of the accident.

2 Universal Underwriters allowed an automobile dealer's insurer to recover as the dealer's subrogee from a third party driver for damages done to the dealer's automobile in a collision between the third party's and the dealer's automobile without regard to the negligence of the customer of the dealer who was driving the dealer's automobile.

3 Restatement, Second, Torts, § 485. See, also, Restatement, Second, Torts, Tentative Draft No. 9, § 485, p. 51, for Note to Institute on reasons for suggested changes in § 485.

4 Similarly, see Prosser, Law of Torts (3d ed.), pp. 500, 501:

'A few courts have interpreted the (owner liability) statute to impute the driver's negligence both ways, so that the owner's action is barred. The greater number of courts have looked to the purpose of the statute, which is obviously to protect injured plaintiffs against the financial irresponsibility of drivers, and not to diminish any recovery which would otherwise be allowed; and accordingly they have held that the legislation does not have the effect of imputing contributory negligence.'

For Michigan's owner liability statute see C.L.S.1961, § 257.401 (Stat.Ann.1960 Rev. § 9.2101).

5 In Universal Underwriters, Mr. Justice O'Hara, in an opinion signed by an additional justice, concluded his opinion with the following observation (375 Mich. 102, 112, 133 N.W.2d 167): I agree further with my Brother that the 'ownership statute' imposes liability upon the owner for the acts of one driving with the owner's express or implied consent, but that it does not relate the driver's negligence to the owner in an action against a third party.' This, coupled with Mr. Justice Adams' opinion, signed by 2 other justices, which would have abolished the doctrine of imputed contributory negligence altogether, leads us to conclude that in Michigan the negligence of a driver may not be imputed to the vicariously liable owner.

6 While recognizing there would be little justification for imputing negligence to an innocent plaintiff in most cases, professors Harper and James...