Universal Underwriters Ins. Co. v. Vallejo

• Decision Date: 20 October 1989
• Docket Number: Docket No. 109076
• Citation: 179 Mich.App. 637,446 N.W.2d 510
• Parties: UNIVERSAL UNDERWRITERS INSURANCE COMPANY, Subrogee of Martin Chevrolet Sales, Inc., and individually, Plaintiff-Appellant, v. Jesus Ernesto VALLEJO, Defendant-Appellee. 179 Mich.App. 637, 446 N.W.2d 510
• Court: Court of Appeal of Michigan — District of US

Page 510

446 N.W.2d 510

UNIVERSAL UNDERWRITERS INSURANCE COMPANY, Subrogee of Martin Chevrolet Sales, Inc., and individually Plaintiff-Appellant, v. Jesus Ernesto VALLEJO, Defendant-Appellee.

Docket No. 109076.

179 Mich.App. 637, 446 N.W.2d 510

Court of Appeals of Michigan.

Submitted June 21, 1989.

Decided Aug. 21, 1989.

Released for Publication Oct. 20, 1989.

[179 MICHAPP 638] Davidson, Breen & Doud, P.C. by Janice M. Conrad, Saginaw, for plaintiff-appellant.

Smith & Brooker, P.C. by Gary R. Campbell, Saginaw, for defendant-appellee.

[179 MICHAPP 639] Before WAHLS, P.J., and DOCTOROFF and BRENNAN, JJ.

WAHLS, Presiding Judge.

Plaintiff, Universal Underwriters Insurance Company, appeals from a May 9, 1988, order of the Saginaw Circuit Court granting a motion for summary disposition brought by defendant, Jesus Ernesto Vallejo. We reverse the order of the trial court and remand the case for further proceedings as to plaintiff's claim for breach of a bailment contract.

The record reveals that on March 19, 1986, defendant was a customer at Martin Chevrolet Sales, Inc., in Saginaw, and requested permission to test drive a 1986 Chevrolet Camaro IROC. While test driving the vehicle, defendant was involved in an automobile accident and "totaled" the car. After absorbing a $1,000 deductible, Martin Chevrolet recovered $12,137.23 for the damage to the car under its insurance policy with plaintiff. On December 16, 1986, plaintiff, individually and as the subrogee of Martin Chevrolet, filed a lawsuit against defendant under a common-law bailment theory. On January 5, 1988, defendant filed a motion for summary disposition under MCR 2.116(C)(8) and 2.116(C)(10), claiming that "[t]he defendant's test drive of the motor vehicle with the permission of Martin Chevrolet did not constitute a bailor-bailee contract" and that "[t]he plaintiff's claims are barred by the provisions of the No Fault Act." The trial court twice delayed deciding defendant's motion in order to permit plaintiff the opportunity to amend its complaint to allege specific facts supporting its bailment claim. In its second amended complaint, filed on March 3, 1988, plaintiff alleged, among other things:

20. On or about March 19, 1986 Defendant, JESUS E. VALLEJO, entered [the premises of] Plaintiff's[179 MICHAPP 640] Subrogor, MARTIN CHEVROLET SALES, INC., with the intention to "test drive" a high performance vehicle.

21. On or about March 19, 1986 Defendant, JESUS E. VALLEJO, requested to "test drive" a 1986 Chevrolet Camaro IROC, which is a high performance sports car.

22. Defendant, JESUS E. VALLEJO, represented that he was interested in purchasing said vehicle in order to induce Plaintiff Subrogor, MARTIN CHEVROLET SALES, INC., to allow him to "test drive" said high performance sports car.

23. That Defendant, JESUS E. VALLEJO, expressly and/or impliedly agreed to take care of the vehicle while undergoing said test drive.

24. Defendant, JESUS E. VALLEJO, expressly and/or impliedly agreed to return said vehicle to Defendant, MARTIN CHEVROLET SALES, INC., upon completion of the test drive.

25. Defendant, JESUS E. VALLEJO, expressly and/or impliedly agreed to return said vehicle to Defendant Subrogor, MARTIN CHEVROLET SALES, INC., in the same condition as it was when he took possession for said test drive.

26. Relying upon the expressed and/or implied representations of Defendant, JESUS E. VALLEJO, Plaintiff Subrogor, MARTIN CHEVROLET SALES, INC., allowed Defendant VALLEJO to take possession and gave permission to test drive said vehicle.

27. Defendant VALLEJO had the sole and exclusive possession and control of said high performance sports car.

28. That while said vehicle was in Defendant VALLEJO's sole and exclusive possession and control, Defendant intentionally and willful [sic] and wantonly damaged the vehicle which was a "total loss" as described above.

29. Defendant, JESUS E. VALLEJO, failed to return the vehicle in the same condition as a direct and proximate result from his failure to keep the property safe and free from any damage, and the above-described conduct.

30. That the above-described business relationship[179 MICHAPP 641] between Defendant VALLEJO and MARTIN CHEVROLET SALES, INC., constitutes a contract as a result of the express and/or implied bailment agreement reached between the parties.

31. That Plaintiff Subrogor MARTIN CHEVROLET SALES, INC., and Defendant, JESUS E. VALLEJO, entered into said bailment for the benefit of the bailee.

32. As a result of Defendant, JESUS E. VALLEJO's, intentional, willful and wanton and reckless acts, omissions and conduct, and breach of the bailment contract, both express and implied, damages result[ed] in the amount of Thirteen Thousand One Hundred Thirty-seven Dollars and Twenty-three Cents ($13,137.23) of which UNIVERSAL UNDERWRITERS paid Twelve Thousand One Hundred Thirty-seven Dollars and Twenty-three Cents ($12,137.23) with a net salvage value of Two thousand Sixty-eight Dollars and fifty Cents ($2,068.50), leaving a total loss of Ten thousand Sixty-eight Dollars and Sixty-five Cents ($10,068.65) and MARTIN CHEVROLET SALES, INC. paying the One Thousand ($1,000.00) Dollar deductible.

Of the three remaining counts in plaintiff's second amended complaint, one was withdrawn by plaintiff and two were not raised, and therefore were abandoned, on appeal. Midland v. Helger Construction Co., Inc., 157 Mich.App. 736, 745, 403 N.W.2d 218 (1987).

In granting defendant's motion for summary disposition, the trial court specified neither the specific subrule of MCR 2.116(C) upon which it relied nor the specific reasons prompting it to grant defendant's motion. The court merely stated, "I'm going to grant the motion for summary judgment [sic] in this case for the reasons requested by the defense attorney." The defense attorney had argued, among other things not now relevant, that plaintiff's second amended complaint failed to state a claim upon which relief could be granted [179 MICHAPP 642] because it did "not [state] any specific facts other than what has already been alleged in general terms in [the] original complaint" and because it was barred by the provision in the no-fault act, M.C.L. Sec. 500.3101 et seq.; M.S.A. Sec. 24.13101 et seq., which abolished tort liability for unintentionally caused loss. M.C.L. Sec. 500.3135; M.S.A. Sec. 24.13135.

On appeal, plaintiff first contends that the no-fault act does not bar its common-law bailment claim against defendant in this case.

The no-fault act in large measure abolished tort liability for injuries or damages arising from the ownership, maintenance, or use in Michigan of a motor vehicle. M.C.L. Sec. 500.3135; M.S.A. Sec. 24.13135; Citizens Ins. Co. of America v. Tuttle, 411 Mich. 536, 544-547, 309 N.W.2d 174 (1981). However, the act did not abolish contractual liability for losses arising from the use of a motor vehicle. National Ben Franklin Ins. Co. v. Bakhaus Contractors, Inc., 124 Mich.App. 510, 335 N.W.2d 70 (1983); Kinnunen v. Bohlinger, 128 Mich.App. 635, 341 N.W.2d 167 (1983); Hengartner v. Chet Swanson Sales, Inc., 132 Mich.App. 751, 758, 348 N.W.2d 15 (1984). In the present case, plaintiff sought to impose liability against defendant for losses incurred as a result of defendant's breach of a bailment contract. It follows, therefore, that plaintiff's contract claim was not barred by the no-fault act.

Second, plaintiff contends that its second amended complaint sufficiently stated a cause of action for breach of a bailment contract to survive defendant's motion for summary disposition under MCR 2.116(C)(8). Regarding this court rule, this Court has stated:

A motion for summary disposition brought under MCR 2.116(C)(8), failure to state a claim upon which relief can be granted, is tested by the pleadings[179 MICHAPP 643] alone and examines only the legal basis of the complaint. The factual allegations in the complaint must be accepted as true, together with any inferences which can reasonably be drawn therefrom. Unless the claim is so clearly unenforceable as a matter of law that no factual development could possibly justify recovery, the motion should be denied. Beaudin v Michigan Bell Telephone Co, 157 Mich App 185, 187, 403 NW2d 76 (1986). However, the mere statement of the pleader's conclusions, unsupported by allegations of fact upon which they may be based, will not suffice to state a cause of action. Nu Vision v Dunscombe, 163 Mich App 674, 681; 415 NW2d 234 (1988 [1987] ), lv den 430 Mich 875 (1988). [Roberts v. Pinkins, 171 Mich.App. 648, 651, 430 N.W.2d 808 (1988).]

The term "bailment" has been defined by this Court as follows:

"Bailment," in its ordinary legal signification, imports the delivery of personal property by one person to another in trust for a specific purpose, with a contract, express or implied, that the trust shall be faithfully executed and the property returned or duly accounted for when the special purpose is accomplished. In re George L Nadell & Co, Inc, 294 Mich 150, 154; 292 NW 684 (1940); National Ben Franklin Ins Co v Bakhaus Contractors, Inc, 124 Mich App 510, 512, n 2; 335 NW2d 70 (1983). Phrased another way, it is a relationship wherein a person gives to another the temporary use and possession of property other than money, the latter agreeing to return the property to the former at a later time. Godfrey v City of Flint, 284 Mich 291, 295-296; 279 NW 516 (1938). [Goldman v. Phantom Freight, Inc., 162 Mich.App. 472, 479-480, 413 N.W.2d 433 (1987), lv. den., 429 Mich. 867 (1987).]

That a bailment contract may be created under circumstances such as those present in this case is not in any way surprising. Defendant was given [179 MICHAPP 644] the temporary use of the car owned by Martin Chevrolet for the special purpose of test driving it. Clearly, an implicit, though perhaps unwritten, prerequisite of such use was that defendant agreed to return the car in the same condition it was in...