Wilson v. Doehler-Jarvis Division of National Lead Co., DOEHLER-JARVIS

• Decision Date: 04 January 1960
• Docket Number: DOEHLER-JARVIS,No. 27,27
• Citation: 358 Mich. 510,100 N.W.2d 226
• Parties: Edna WILSON, Guardian of Sharon Louise BENTLEY and Ronald Bentley, minor children of James A. Bentley, deceased, Plaintiff, Appellee and Cross-Appellant, v.DIVISION OF NATIONAL LEAD COMPANY, Defendant, Appellant and Cross-Appellee.
• Court: Michigan Supreme Court

Page 226

100 N.W.2d 226

358 Mich. 510

Edna WILSON, Guardian of Sharon Louise BENTLEY and Ronald Bentley, minor children of James A. Bentley deceased, Plaintiff, Appellee and Cross-Appellant, v. DOEHLER-JARVIS DIVISION OF NATIONAL LEAD COMPANY, Defendant Appellant and Cross-Appellee.

No. 27.

Supreme Court of Michigan.

Jan. 4, 1960.

Marcus, Kelman, Loria, McCroskey & Finucan, Muskegon, for plaintiff, appellee and cross-appellant.

Warner, Norcross & Judd, Grand Rapids, for defendant and appellant.

Before the Entire Bench.

VOELKER, Justice.

This appeal and cross-appeal involves a claim of interest on a workmen's compensation award. On May 11, 1954 the initial application for hearing and adjustment of claim before the workmen's compensation commission was filed by the injured employee, James A. Bentley. Thereafter Mr. Bentley died of cancer. On March 25, 1955 the plaintiff herein, Mrs. Edna Wilson, guardian for Mr. Bentley's 2 minor children, filed her application for hearing and adjustment of claim. An award was allowed by the hearing referee, which was ultimately appealed to and affirmed by this Court. See Wilson v. Doehler-Jarvis Division of National Lead Co., 353 Mich. 363, 91 N.W.2d 538. So much for background.

Thereafter a motion was filed in the circuit court praying judgment on the award in accordance with the opinion of this Court and also seeking interest on the award at the rate 5% per annum from February 19, 1955, the date of death. Judgment and interest were granted at the rate requested, but not the date, but instead from the date of the appeal board's order of October 23, 1956, and from the due date of each payment coming due thereafter. From that judgment the parties have appealed and cross-appealed. Defendant-appellant, Doehler-Jarvis Division of National Lead Company, claims that the circuit court had no jurisdiction whatever to allow any interest, and that even if it possessed such jurisdiction interest should not have been allowed until the award was final, which appellant urges is not until it had been finally affirmed by this Court. On her side plaintiff and cross-appellant understandably argues that the court had jurisdiction not only to allow interest, but that it should have been allowed from the date compensation first became due and payable.

The controversy boils down to 2 questions. Can interest ever be allowed by the circuit court on a workmen's compensation award when neither the award nor the statute makes specific reference thereto? Assuming jurisdiction in the circuit court ever to allow interest, at what point should such interest commence?

To support its claim that the circuit court was without jurisdiction to allow interest on the award, appellant cites us to Fowler v. Muskegon County, 340 Mich. 522, 65 N.W.2d 801, a similar case dealing with the allowance of interest on a workmen's compensation award. That case held flatly that interest is statutory, and that because the workmen's compensation act did not specifically provide for interest, the circuit court was without authority to allow it. Appellant then says in its brief:

'It is obvious that what is sought in this case is a reversal of the Fowler decision, and that Judge Searl's opinion awarding interest is based not upon the settled law of the State of Michigan but upon his guess as to how a majority of the present Supreme Court might view the law.

'It is likewise obvious that adherence to the doctrine of stare decisis will result in a reversal of Judge Searl's decision, and a vacation of the judgment entered by him.

'Only if a majority of the present court is convinced (a) that the Fowler decision is wrong, (b) that the universally followed procedure under the Michigan Workmen's Compensation Law that interest is not paid on awards should be set aside, and (c) that the rules of stare decisis should, in this case, be set aside, can the judgment appealed from be sustained.'

Notwithstanding appellant's quoted understanding of the oft-discussed doctrine of stare decisis, this Court will not close its eyes to a possible error it may have committed in the past. We do not believe that the doctrine of stare decisis means that this Court and the evolution of the law should be controlled by the 'dead hand from the past.' Nor do we believe that this Court must perpetuate error simply because it may have reached a wrong result in one of its earlier decisions. Such is not our understanding of the doctrine of stare decisis. See Van Dorpel v. Haven-Busch Co., 350 Mich. 135, 85 N.W.2d 97 for an extended discussion. With these thoughts in mind we will proceed to our discussion of the questions before us, and re-examine the principles set out in the cited Fowler Case.

The workmen's compensation act neither provides for, nor forbids, the allowance of interest by the circuit court; the subject is simply not mentioned.* The question is, does the circuit court have authority to allow the legal rate of interest when it enters a judgment on a compensation award? In the Fowler Case we said that interest is purely statutory, yet the fact is that we have consistently allowed interest in many cases in which no express statute could be invoked. See Hammond v. Hannin, 21 Mich. 374 (damages for breach of contract to convey land); McCreery v. Green, 38 Mich. 172 (fraudulent conveyance, breach of contract); Snow v. Nowlin, 43 Mich. 383, 5 N.W. 443 (fradulent conveyance); Taylor v. Bay City St. Railway Co., 101 Mich. 140, 59 N.W. 447 (damages for negligence); Kaminski v. Wayne County Board of Auditors, 287 Mich. 62, 282 N.W. 902 (suit for back salary of a circuit court commissioner).

On this same subject the United States supreme court in Rodgers v. United States, 332 U.S. 371, 68 S.Ct. 5, 7, 92 L.Ed. 3 speaking through Mr. Justice Black said:

'* * * There is no language in the Agricultural Adjustment Act or in any other act of Congress which specifically allows or forbids interest on penalties such as these prior to judgment. But the failure to mention interest in statutes which create obligations has not been interpreted by this Court as manifesting an unequivocal congressional purpose that the obligation shall nor bear interest. Billings v. United States, 232 U.S. 261, 284-288, 34 S.Ct. 421, 425-427, 58 L.Ed. 596, 606-608. For in the absence of an unequivocal prohibition of interest on such obligations, this Court has fashioned rules which granted or denied interest on particular statutory obligations by an appraisal of the congressional purpose in imposing them and in the light of general principles deemed relevant by the Court. See, e. g., Royal Indemnity Co. v. United States, supra [313 U.S. 289, 61 S.Ct. 995, 85 L.Ed. 1361]; Board of Com'rs of Jackson County v. United States, 308 U.S. 343, 60 S.Ct. 285, 84 L.Ed. 313.

'As our prior cases show, a persuasive consideration in determining whether such obligations shall bear interest is the relative equities between the beneficiaries of the obligation and those upon whom it has been imposed. And this Court has generally weighed these relative equities in accordance with the historic judicial principle that one for whose financial advantage an obligation was assumed or imposed, and who has suffered actual money damages by another's breach of that obligation, should be fairly compensated for the loss thereby sustained (citing authority).'

We also feel that the failure of the legislature to mention interest does not necessarily mean that it intended that the obligation created by it should not bear interest. Rather we must look to the purpose of the legislation:

'The primary purpose of the Workmen's Compensation Act is to provide compensation for disability or death resulting from occupational injuries or diseases or accidental injury to or death of employees. The statute is a remedial one enacted primarily for the benefit of the man who works in the pursuits subject to its provisions; it is for the benefit of injured employees and not injured employers.' 24 M.L.P., Workmen's Compensation, § 2, p. 229.

Who benefited from the delay in payment here? Who, if anyone, suffered any loss? In the instant case the disputed claim for compensation has been in the throes of litigation for over 5 years. In the meantime the defendant-appellant has had the possession and use of funds that it now appears rightfully belonged all along to the plaintiff, while the plaintiff (theoretically if not actually) had to raise money elsewhere (and presumably pay interest on it) to meet the daily necessities of life. In a real sense, then, the employee and his dependents have been obliged to help subsidize the employer in the long expensive fight for possession of the money thus wrongfully withheld.

Considering the broad purposes of the workmen's compensation act and the various equities involved we think and hold that the circuit court properly had jurisdiction to allow interest on the award. In so holding we expressly overrule the contrary principles expressed in the Fowler Case. This decision shall not, however, be regarded as retroactive.

We are now left with the question of when the interest should begin to run. In that regard we quote with approval the comments of Dean Roscoe Pound on the case of Parker v. Brinson Construction Co., Fla., 78 So.2d 873. This commentary may be found in 16 N.A.C.C.A. Law Journal, pp. 135, 136.

'There was 'no controlling statute on the subject,' and the question was 'one of first impression in Florida.' The opinion of the Court puts the matter very well as follows: 'The basic philosophy of the act is to insure and secure prompt payment of compensation or other awards to the man who works for wages or his beneficiaries. This Court knows that the smaller the award of compensation, the greater is the need for the prompt payment thereof. It is common knowledge that those who work for small wages are dependent upon such wages for their immediate livelihood. Inherent in...