Phillips v. Mirac, Inc.

• Decision Date: 07 June 2002
• Docket Number: Docket No. 227257.
• Citation: 251 Mich. App. 586,651 N.W.2d 437
• Parties: Margaret PHILLIPS, Personal Representative of the Estate of Regeana Diane Hervey, deceased, Plaintiff-Appellee, v. MIRAC, INC., Defendant-Appellant.
• Court: Court of Appeal of Michigan — District of US

651 N.W.2d 437

251 Mich. App. 586

Margaret PHILLIPS, Personal Representative of the Estate of Regeana Diane Hervey, deceased, Plaintiff-Appellee, v. MIRAC, INC., Defendant-Appellant.

Docket No. 227257.

Court of Appeals of Michigan.

Submitted January 16, 2002, at Lansing.

Decided June 7, 2002, at 9:05 a.m.

Released for Publication September 10, 2002.

Trogan & Trogan, P.C. (by Nicholas R. Trogan, III), Saginaw, for the plaintiff.

Plunkett & Cooney, P.C. (by Ernest R. Bazzana and Hans H.J. Pijls), Detroit, for the defendant.

Before: GAGE, P.J., and HOEKSTRA and METER, JJ.

HOEKSTRA, J.

In this appeal, we must determine whether the statutory cap on recoverable damages set forth in M.C.L. § 257.401(3) violates the Michigan Constitution. This provision limits a plaintiff's recovery in an action against a lessor of a motor vehicle, absent negligence by the lessor, when bodily injury or death occurs from an accident involving a motor vehicle leased for thirty days or less. We find that the damages cap provision of M.C.L. § 257.401(3) does not violate a party's rights to a jury trial, to equal protection, or to due process of law, under the Michigan Constitution. Consequently, we hold that the statute is constitutional. Because the trial court found the statute unconstitutional, we reverse and remand.

I. Facts and Procedural History

This action arises from an automobile accident in October 1997 that resulted in the death of Regeana Diane Hervey, a passenger in the automobile driven by Da-Fel Reed. Reed had rented the automobile involved in the accident for a period of thirty days or less from defendant Mirac, Inc., doing business as Enterprise Rent-A-Car. Plaintiff Margaret Phillips, who is the decedent's mother and the personal representative of the decedent's estate, commenced this action against defendant¹ on the basis of owner's liability under § 401 of the Michigan Motor Vehicle Code (MVC), M.C.L. § 257.401. The parties stipulated that under Michigan law, defendant is responsible for Reed's authorized operation of the rented automobile. Plaintiff did not allege that defendant was negligent in leasing the automobile to Reed.

A jury trial commenced in November 1999, and the jury returned a verdict in favor of plaintiff.² Both plaintiff and defendant presented orders for entry of judgment. Plaintiff sought entry of judgment for $250,000, plus statutory interest, fees, and costs, while defendant sought entry of judgment for $20,000, pursuant to M.C.L. § 257.401(3) (subsection 401[3]), plus statutory interest, fees, and costs. After oral argument concerning the constitutionality of the statutory cap on recoverable damages in subsection 401(3), the trial court determined that this provision is unconstitutional under the Michigan Constitution because it violates the rights to a jury trial, equal protection, and due process. Thus, on April 26, 2000, the trial court entered judgment in favor of plaintiff in the amount of $250,000, plus interest, fees, and costs. This appeal ensued.

II. Standard of Review

The constitutionality of a statute is a question of law that this Court reviews de novo. Tolksdorf v. Griffith, 464 Mich. 1, 5, 626 N.W.2d 163 (2001); Proctor v. White Lake Twp. Police Dep't, 248 Mich.App. 457, 461, 639 N.W.2d 332 (2001). "A statute is presumed constitutional, unless its unconstitutionality is readily apparent." Tolksdorf, supra; McDougall v. Schanz, 461 Mich. 15, 24, 597 N.W.2d 148 (1999); Proctor, supra at 461-462, 639 N.W.2d 332. A statute is not unconstitutional merely because it is undesirable, unfair, or unjust. Doe v. Dep't of Social Services, 439 Mich. 650, 681, 487 N.W.2d 166 (1992); In re Juvenile Commitment Costs, 240 Mich.App. 420, 440, 613 N.W.2d 348 (2000).

III. Analysis

On appeal, defendant maintains that the trial court's finding that subsection 401(3) violates a party's rights to a jury trial, to equal protection, and to due process of law was error. Subsection 401(3) provides in pertinent part:

Unless the lessor, or his or her agent, was negligent in the leasing of the motor vehicle, the lessor's liability under this subsection is limited to $20,000.00 because of bodily injury to or death of 1 person in any 1 accident and $40,000.00 because of bodily injury to or death of 2 or more persons in any 1 accident. [MCL 257.401(3).]

The challenge to the constitutionality of this damages cap raises a question of first impression.

A. Right to Trial by Jury

In the trial court, plaintiff first challenged the damages cap provision of subsection 401(3) by claiming that the statute violates the right under the Michigan Constitution to a jury trial. Specifically, plaintiff maintained, and continues to maintain on appeal, that subsection 401(3) interferes with the plaintiff's right to have the jury assess damages and that the Legislature may not "whittle away" this right. According to plaintiff, the Legislature, by enacting this provision, has circumvented the jury's award of damages, which "hollows and eviscerates the right to trial by jury, thus rendering its existence one of mere form, and not substance."

To the contrary, defendant contends that subsection 401(3) is constitutional because it constitutes a valid and legitimate exercise of the Legislature's police power. In particular, defendant argues that subsection 401(3) does not violate the right to a jury trial because the Legislature has the authority to abolish or modify rights and remedies, whether they are based on common law or statutes. Defendant further argues that subsection 401(3) does not impinge on the jury's right to determine facts; rather, subsection 401(3) merely limits the legal consequences of the jury's finding. According to defendant, statutory damages caps constitute a legal, rather than factual, determination and therefore are not subject to the right to a jury trial.

In Michigan, our constitution guarantees the right to a jury trial. In relevant part, the Michigan Constitution provides that "[t]he right of trial by jury shall remain, but shall be waived in all civil cases unless demanded by one of the parties in the manner prescribed by law." Const. 1963, art. 1, § 14.³ First, we note that defendant does not challenge that the right to a jury trial extends to an action under the civil liability act of the MVC, M.C.L. § 257.401 et seq.⁴ Further, in Michigan the right to a jury trial includes the right to have the jury assess damages. See Wood v. DAIIE, 413 Mich. at 573, 583-584, 321 N.W.2d 653 (1982); Leary v. Fisher, 248 Mich. 574, 578, 227 N.W. 767 (1929); Mink v. Masters, 204 Mich.App. 242, 246, 514 N.W.2d 235 (1994); Equico Lessors, Inc. v. Original Buscemi's, Inc., 140 Mich.App. 532, 536, 364 N.W.2d 373 (1985). Overlying a plaintiff's right to have a jury decide damages in a suit against the owner of a motor vehicle is subsection 401(3), which the Legislature adopted to limit the amount that a plaintiff may recover against the owner in certain circumstances. Contrary to what the trial court held, we find that this damages cap provision does not impinge on a plaintiff's right to a jury trial for two reasons.⁵ First, our Legislature has the power to abolish or modify common-law and statutory rights and remedies. The Michigan Constitution provides that "[t]he common law and the statute laws now in force, not repugnant to this constitution, shall remain in force until they expire by their own limitations, or are changed, amended or repealed." Const. 1963, art. 3, § 7; see Donajkowski v. Alpena Power Co., 460 Mich. 243, 256, n. 14, 596 N.W.2d 574 (1999) (our Legislature has express constitutional authority to change the common law); Myers v. Genesee Co. Auditor, 375 Mich. 1, 7, 133 N.W.2d 190 (1965) (O'Hara, J.) (the common law and statutes abide unless "changed, amended or repealed"). Simply stated, what the Legislature gives, it may take away. Lahti v. Fosterling, 357 Mich. 578, 589, 99 N.W.2d 490 (1959); Ramsey v. Michigan Underground Storage Tank Financial Assurance Policy Bd., 210 Mich.App. 267, 270, 533 N.W.2d 4 (1995). Where the Legislature can abolish a cause of action, it necessarily follows that it can limit the damages recoverable for the cause of action. Kirkland v. Blaine Co. Medical Center, 134 Idaho 464, 468, 4 P.3d 1115 (2000).

Our Legislature has utilized its power to limit or eliminate defendant liability in certain cases. See, e.g., M.C.L. § 691.1407 (governmental immunity from tort liability); MCL 418.131 (worker's compensation is exclusive remedy against an employer); MCL 324.73301 (limitation of landowners' liability for injuries to guests to gross negligence or willful and wanton misconduct). In addition, through statutes of limitation or repose, our Legislature limits the time in which a plaintiff can bring an action, thereby preventing causes of action that it deems stale. See, e.g., M.C.L. § 600.5805 (statute of limitations for injuries to persons or property). Because our Legislature can change, amend, or repeal the common-law or statutory provisions and because that power allows it to limit or completely eliminate actions, we find that it logically follows that the Legislature may limit a plaintiff's remedy. We, like the Supreme Court of Idaho, "can discern no logical reason why a statutory limitation on a plaintiff's remedy is any different than other permissible limitations on the ability of plaintiffs to recover in tort actions." Kirkland, supra at 468, 4 P.3d 1115.

Nor do we believe that at the time the Constitution of 1963 was adopted, the intent was to prohibit the Legislature from addressing appropriate damages. A number of Michigan statutes at that time provided, and continue to provide, for double or treble damages in civil actions. See, e.g., M.C.L. § 230.7 (providing treble damages for injuries to bridges); MCL 429.103 (providing double the amount of damages sustained by breach contract of sale for Michigan wheat). Although these statutes increase, rather...