text:
    YOUMANS v CITIZENS INSURANCE COMPANY OF AMERICA
    Docket No. 78-828.
    Submitted January 9, 1979, at Lansing.
    Decided April 2, 1979.
    Leave to appeal applied for.
    Plaintiff, Dale A. Youmans, was injured in an automobile accident in which his wife was killed. His daughter, Tanya, survived. Plaintiff sued defendant, Citizens Insurance Company of America, in district court for benefits for reasonably incurred expenses for the care of Tanya necessitated by the death of her mother. The amount claimed exceeded the jurisdictional limits of the court and the suit was removed to the Genesee Circuit Court. In an amended complaint plaintiff also sought benefits for services performed for him that he would have performed for himself had he not been injured and for various medical expenses, and plaintiff contested the validity of the excess-deductible provision in his policy with defendant. After the accident both plaintiff and Tanya stayed with plaintiffs mother and mother-in-law until plaintiff remarried. Plaintiff alleged an agreement with his new wife to pay her $20 per day to care for Tanya. The court, Robert M. Ransom, J., concluded that plaintiff "reasonably incurred” expenses with his mother and mother-in-law for his own ordinary and necessary care at the maximum $20-per-day rate, that plaintiffs remarriage reestablished the family unit and ended the need for plaintiff to incur expenses for ordinary and necessary services for Tanya, and that plaintiff was entitled to benefits for Tanya’s care only from the time he returned to work to the date of his remarriage, and awarded plaintiff a judgment accordingly. Plaintiff appeals the denial of benefits for replacement services for Tanya after plaintiffs remarriage. Held:

    Remarriage of a husband and father of a child whose mother was killed in an automobile accident does not terminate the child’s eligibility to receive survivor’s loss benefits under the no-fault act for loss of sérvices which would have been provided by the child’s mother; the father may contract with his new wife to provide those services.
    Reversed and remanded.
    Reference for Points in Headnote
    New Topic Service Am Jur 2d, No-Fault Insurance § 31.

      Automobiles — No-Fault Insurance — Survivor’s Loss Benefits — Statutes.
    Remarriage of a husband and father of a child whose mother was killed in an automobile accident does not terminate the child’s eligibility to receive survivor’s loss benefits under the no-fault act for loss of services which would have been provided by the child’s mother; the father may contract with his new wife to provide those services (MCL 500.3108; MSA 24.13108).

      Hicks, Beltz, Behm & Nickola, for plaintiff.

      Milliken & Magee, for defendant.
    Before: V. J. Brennan, P.J., and M. F. Cavanagh and C. J. Hoehn, JJ.

       Circuit judge, sitting on the Court of Appeals by assignment.

   V. J. Brennan, P.J.

Plaintiff appeals as of right from a portion of a February 17, 1978, judgment of Genesee County Circuit Judge Robert M. Ransom. Plaintiff was injured in an automobile accident on February 19, 1975. His wife was killed. Surviving was their two-year-old daughter, Tanya. Defendant is plaintiff’s "no-fault” insurer.

Plaintiff filed a complaint in district court in Flint on October 3, 1975. The amount of damages sought exceeded district court jurisdictional limits and on August 2, 1976, the case was removed to circuit court. An amended complaint was filed in circuit court on October 27, 1976, alleging that defendant had failed to pay benefits for reasonably incurred expenses for the care of plaintiff’s daughter necessitated by plaintiff’s wife’s death and for services performed for plaintiff that he would have performed for himself had he not been injured. Plaintiff also sought recovery for various medical expenses and contested the validity of an excess-deductible provision in his policy with defendant.

Plaintiff testified that he suffered hip, back and internal injuries. His back was broken. He had to wear a corset until June 7, 1975. He was unable to bend over or to move around without crutches. He and his daughter, Tanya, stayed with plaintiffs mother and his mother-in-law who cared for them. Plaintiff returned to work on October 1, 1975. From October . 1975 until January of 1976 plaintiffs mother-in-law cared for Tanya.

On January 6, 1976, plaintiff remarried. Plaintiff stated that he had an agreement with his new wife to pay her $20 per day to care for Tanya. The amount was based on the benefit provided in the no-fault statute. There was no definite term to the agreement between the parties.

The trial court concluded that plaintiff "reasonably incurred” expenses with his mother and mother-in-law for his own "ordinary and necessary” care at the rate of $20 per day. In fact, the court thought that the reasonable value of the services rendered to plaintiff was more than the $20 allowed under the no-fault statute.

The court also concluded that plaintiffs remarriage reestablished the family unit and ended the need for plaintiff to incur expense for ordinary and necessary services for Tanya in lieu of those provided by her dead mother. The court found insufficient evidence of a contract between plaintiff and his new wife for the care of Tanya. The court denied plaintiff benefits for replacement services for Tanya from the date of his remarriage, although it awarded benefits for the time between plaintiffs return to work and his remarriage, when Tanya was cared for by her grandmother.

The court found that the excess-deductible provision in plaintiffs policy was a part of the policy at the time of the accident. Plaintiff was awarded his claimed unreimbursed medical expenses.

Plaintiffs appeal contests only the denial of benefits for replacement services for Tanya after plaintiffs remarriage.

The plaintiff argues that his remarriage did not end the dependency of the child on the deceased mother. MCL 500.3110(1)(c); MSA 24.13110(1)(c). He argues that the trial court’s conclusion that plaintiffs remarriage reestablished a family unit and ended the provision of replacement services for Tanya is without legal basis and that nowhere in the no-fault statute is there language that disqualifies relatives from performing services. He further argues that in the Worker’s Disability Compensation Act, another no-fault statute, the Supreme Court has held that a disabled employee may recover benefits for services rendered him by his wife, Kushay v Sexton Dairy Co, 394 Mich 69; 228 NW2d 205 (1975), and that the insurer should not reap a windfall because ordinary and necessary services rendered to replace those which would have been performed are performed by a wife instead of a housekeeper or a nursemaid. We agree.

Defendant argues that there was no contract between plaintiff and his new wife to care for Tanya and that the language of the statute requiring expenses to be reasonably incurred can hardly be construed to provide for payment to a new wife for the care of her husband’s daughter.

Defendant further argues Kushay v Sexton Dairy Co, supra, is distinguishable since it arose under a section of the Worker’s Disability Compensation Act which requires employers to furnish services to the injured employee. It is defendant’s position that § 3108 of the no-fault act does not require payment for child care under all circumstances, but only where the expenses are reasonably incurred and that the trial court properly found that expenses claimed here were not reasonably incurred.

This is a case of first impression under the no-fault act. MCL 500.3101 et seq.; MSA 24.13101 et seq.

No cases have construed § 3108 of the act, the contested provision in this case. It reads as follows:

"Personal protection insurance benefits are payable for a survivor’s loss which consists of a loss, after the date on which the deceased died, of contributions of tangible things of economic value, not including services, that dependents of the deceased at the time of his death would have received for support during their dependency from the deceased if he had not suffered the accidental bodily injury causing death and expenses, not exceeding $20.00 per day, reasonably incurred by these dependents during their dependency and after the date on which the deceased died in obtaining ordinary and necessary services in lieu of those that the deceased would have performed for their benefit if he had not suffered the injury causing death. The benefits payable for survivor’s loss in connection with the death of a person in a single 30-day period shall not exceed $1,000.00 and is not payable beyond the first 3 years after the date of the accident.” MCL 500.3108; MSA 24.13108.

Plaintiff argues that his agreement with his new wife to pay her $20 per day for the care of his daughter entitled him to benefits under the section. Defendant argues that a remarriage in which the new wife provides ordinary and necessary services to the daughter ends the insurer’s obligation under this section where there are no other expenditures to care for the daughter. The trial court agreed with defendant.

The Supreme Court has decided that the provision of services by a spouse or relative, where reasonable, is compensable under a provision of the Worker’s Disability Compensation Act. MCL 418.315; MSA 17.237(315). Although the provision does not exactly parallel § 3108 of the no-fault act, both statutes create an entitlement for benefits reasonably provided. Kushay v Sexton Dairy Co, supra. Both statutes are concerned with the provision of services and not with the status of the person providing those services. Thus, the Court in Kushay held that a spouse could recover for services rendered to a husband, even though, in all probability, she would have performed them absent the possibility of recovery from the employer. Kushay v Sexton Dairy Co, supra, pp 74-75.

Plaintiffs new wife does not legally replace his daughter’s dead mother. A stepmother is not liable for all the duties or entitled to all the rights of a parent. See MCL 710.60; MSA 27.3178(555.60). Nor does a stepmother enjoy any favorable presumption for purposes of child custody under the Child Custody Act. See MCL 722.25; MSA 25.312(5).

Plaintiffs remarriage, while re-estalbishing the family unit, in no way affected Tanya’s need for ordinary and necessary services that her dead mother once provided. The trial court improperly concluded that plaintiffs remarriage terminated his daughter’s eligibility to receive survivor’s loss benefits under § 3108 of the no-fault insurance act.

Reversed and remanded for entry of judgment accordingly. Defendant to pay costs and reasonable attorney fees.


source: Caselaw Access Project

author: V. J. Brennan, J.

license: Public Domain

text:
    MICHIGAN DENTAL ASSISTANTS ASSOCIATION v STATE BOARD OF DENTISTRY
    Docket No. 78-1123.
    Submitted December 11, 1978, at Lansing.
    Decided April 2, 1979.
    The Michigan Dental Assistants Association and others brought an action in the Court of Appeals seeking mandamus to compel the Michigan State Board of Dentistry and others to promulgate rules for the training and education of dental assistants, licensed dental assistants and dental hygienists under an amendment to the act regulating dentistry. The Court of Appeals dismissed the action, whereupon the plaintiffs filed an application for leave to appeal to the Michigan Supreme Court.
    In lieu of granting leave to appeal, the Supreme Court remanded the action to Ingham Circuit Court to afford the Michigan State Board of Dentistry the opportunity to promptly complete and promulgate such rules. 399 Mich 886 (1977). The Board of Dentistry filed the rules with the Secretary of State’s office and they were officially considered promulgated on February 23, 1978.
    The plaintiffs then brought an action in Ingham Circuit Court alleging that the Board of Dentistry had failed to complete the Supreme Court order in that the rules failed to provide for training and accreditation of office-trained dental assistants.
    The Ingham Circuit Court, Ray C. Hotchkiss, J., ordered the Board of Dentistry to adopt rules governing the training and accreditation of dental assistants. The defendants appeal. Held:

    The functions of dental assistants are limited, with supervision clearly defined by statute. The amendment to the dentistry act did not contemplate education or training for persons who assist in rendering care under the direct supervision of a licensed dentist. The Board of Dentistry has fully complied with the Supreme Court order.
    The circuit court order is reversed.
    References for Points in Headnotes

       61 Am Jur 2d, Physicians, Surgeons, and Other Healers § 20.

       73 Am Jur 2d, Statutes §§ 272, 275.

      1. Licenses — Dentists — Licensed Dental Assistants — Dental Hygienists — Dental Assistants — Training — Certification Procedure — Statutes.
    The statutory scheme for the training and accreditation of personnel assisting dentists sets forth the requisite training, certification and accreditation for "licensed dental assistants” and “dental hygienists” but does not require training for "dental assistants” (persons who assist in rendering care under the direct supervision of licensed dentists); therefore, the State Board of Dentistry is not required to establish a certification procedure for office-trained dental assistants (MCL 338.209a; MSA 14.629[9a]).
    2. Statutes — Statutory Construction — Legislative Intent.
    A most fundamental rule of statutory construction is that statutory language be given a reasonable construction in order to implement the Legislature’s intent.

      Harris, Lax & Gregg (by Maxine Boord Virtue), for plaintiffs.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Howard C. Manderosian, Assistant Attorney General, for defendants.
    Amicus Curiae: Clark, Klein, Winter, Parsons & Prewitt (by H. William Butler and L. A. Hynds), for Michigan Dental Association.
    Before: R. B. Burns, P.J., and J. H. Gillis and V. J. Brennan, JJ.
   V. J. Brennan, J.

In December of 1973, the Michigan Legislature amended the act regulating dentistry, MCL 338.201, et seq.; MSA 14.629(1), et seq., by adding § 9a, MCL 338.209a; MSA 14.629(9a), relating to dental assistants, dental hygienists and others. Pursuant to § 9a(3), defendant, the Michigan State Board of Dentistry (hereafter, the Board) was required to prescribe rules for the training and education of personnel covered under § 9a.

In February of 1976, plaintiffs, Michigan Dental Assistants Association, et al., filed a writ of mandamus in the Court of Appeals seeking to compel the Board to promulgate rules pursuant to § 9a. This Court dismissed the action, whereupon application for leave to appeal was filed with the Michigan Supreme Court. In April of 1977, the Supreme Court in lieu of granting leave to appeal ordered:

"[T]hat this action in the nature of mandamus be remanded to the Ingham Circuit Court to afford the Michigan State Board of Dentistry the opportunity to promptly complete and promulgate rules and procedures for training, certifying and delineating the duties of dental assistants. Upon that board’s failure to do so, complainants may propose such rules and procedures to the circuit court and the board shall be required to show cause why such proposed rules should not be adopted.” 399 Mich 886 (1977).

At the time of entry of the above order the Board was engaged in the process of promulgating the rules in question pursuant to the Administrative Procedures Act, MCL 24.201, et seq.; MSA 3.560(101) et seq. A public hearing was held June 16, 1977, and the rules were certified by the legislative service bureau on October 27, 1977, as required by § 45 of the Administrative Procedures Act, MCL 24.245; MSA 3.560(145). The rules were certified by the joint committee on administrative rules on December 13, 1977. The rules were filed with the Secretary of State’s Office on February 8, 1978, and were officially considered promulgated on February 23, 1978. See 1978 AACS R 338.4101-R 338.4698.

Plaintiffs then filed an action in Ingham County Circuit Court contending that the Board had failed to comply with the above Supreme Court order since the promulgated rules did not fully implement § 9a. The plaintiffs allege that the rules failed to provide for training and accreditation of office-trained dental assistants, described in § 9a(1), and thus did not discharge the Board’s duties under the act and according to the Supreme Court order.

In a February 27, 1978, order Ingham County Circuit Court Judge Ray C. Hotchkiss concluded in part:

"The Michigan State Board of Dentistry SHALL BE AND HEREBY IS ORDERED to adopt rules governing the training and accreditation of dental assistants not included in current rules, specifically including office-trained dental assistants, either by adopting the rules suggested and proposed by Plaintiffs-Appellants and placed of record in this cause, or, alternatively, by adopting other rules which will indicate the training and accreditation required for office-trained dental assistants.”

It is from this order that defendants appeal.

The case at bar concerns the interpretation of § 9a of the dentistry act, supra, which provides in pertinent part:

"Sec. 9a. (1) A person may assist in rendering dental care to a patient under the supervision of a licensed dentist, excluding the diagnosing or prescribing for a disease, pain, deformity, deficiency, injury or physical condition, or the cutting of the human teeth, alveolar process, gums, jaws or attendant tissue, the removal of accretion and stains including calcareous deposits, deep scaling, root planing, restoration of hard or soft tissue and the independent administration of anesthesia, analgesia or acupuncture and other procedures prohibited by rules promulgated by the board. The provisions of this subsection shall become effective upon promulgation of the rules by the board.
"(2) A licensed dentist may delegate certain dental procedures prohibited by subsection (1) which the board finds would not jeopardize the dental health of the patient to a person authorized by a certifícate of the board to perform such procedures except that the removal of calcareous deposits, deep scaling, or root planing shall not be delegated to a person other than a dental hygienist. The certificate shall be issued to a person who has satisfactorily completed a program designed to train him to perform these procedures in a school approved by the board and who has passed an examination that may be given by the board. If a program of training for dental hygienists provided for in section 9 qualifies a dental hygienist to perform any of the functions which the board authorizes a person to perform under this subsection, the board shall authorize and grant a certificate to a dental hygienist to perform those functions without further training.
"(3) The board shall prescribe by rules * * * the training and education required to qualify for authorization to perform the procedures for which the applicant may apply. The board may prescribe which procedures shall be under the supervision and which shall be under the direction of a licensed dentist. If a person who has beén issued a certificate to perform certain delegated procedures applies for authorization to perform additional delegated procedures, the board shall determine what additional training shall be satisfactorily completed for an expanded certificate.” MCL 338.209a; MSA 14.629(9a). (Emphasis added.)

The rules as promulgated by the Board are comprehensive and quite detailed with repetition here unnecessary. However, a summary of the rules as they apply to this controversy is in order.

Under the rules, personnel performing the procedures under § 9a(1l) are described as "dental assistants”. Their functions are quite limited with supervision clearly defined. The personnel performing the procedures under § 9a(2) are described as "licensed dental assistant” and "dental hygienists”. Each respectively perform wider functions (in relation to "dental assistant”) with less supervision. The rules set forth the requisite training, certification and accreditation for "licensed dental assistants” and "dental hygienists”. However, no formal training of "dental assistants” is necessary to perform the procedures allowed under § 9a(1). It is this latter deficiency which plaintiffs contend constitutes nonconformance with the Supreme Court order. We disagree.

The rules as established by the Board are in accordance with the subject statutory scheme. Section 9a(1) does not express any requirement for education or training for persons who assist in rendering care under the direct supervision of a licensed dentist. Sections 9a(2) and 9a(3) contemplate certification by the State Board of Dentistry for persons to perform duties designated by licensed dentists. These duties would otherwise be prohibited under § 9a(1).

Had the Legislature intended to require training and accreditation for all personnel assisting dentists, it could have expressed its intention. However, § 9a does not express such an all-embracing requirement. Instead, the Legislature expressed its intention that assistants performing limited functions under § 9a(1) need not obtain certificates indicating they had completed specialized training and education.

To hold, as plaintiffs argue, that the Supreme Court order required the Board to establish a certification procedure for office-trained dental assistants would be contrary to the most fundamental rule of statutory construction, that statutory language be given a reasonable construction in order to implement the Legislature’s intent. King v Director of the Midland County Dep’t of Social Services, 73 Mich App 253; 251 NW2d 270 (1977). While the statutory language here is somewhat involved, its meaning is clear. The circuit court erroneously concluded that the Supreme Court’s order required the Board to promulgate rules prescribing training and certification for the persons described in § 9a(1) of the dentistry act.

We hold that the Board has fully complied with the Supreme Court order of April 22, 1977, and with the requirements under § 9a regarding the promulgation of the rules in question.

The lower court order is reversed. We retain no further jurisdiction. No costs, a public question being involved.


text:
    WARREN POLICE OFFICERS ASSOCIATION v CITY OF WARREN
    Docket No. 78-1324.
    Submitted November 13, 1978, at Detroit.
    Decided April 2, 1979.
    Contract negotiations between defendant, City of Warren, and plaintiff, Warren Police Officers Association, reached an impasse after the contract had expired and arbitration was begun pursuant to the compulsory arbitration of labor disputes in municipal police and fire departments act. An award was granted and signed by the parties. Plaintiff filed a complaint with the Macomb Circuit Court to enforce the provisions of the award which plaintiff claimed directed defendant to provide certain health and dental benefits retroactively. The court, Howard R. Carroll, J., found the award did provide for the benefits retroactively and ordered defendant to comply. Defendant appeals. Held:

    An implicit goal of the compulsory arbitration of labor disputes in municipal police and fire departments act is to provide arbitration awards which approximate agreements that would have been reached in the normal course of collective bargaining; the award of health and insurance benefits retroactively is contemplated by the act, since such benefits are normally included in a private-sector bargaining agreement.
    Affirmed.
    1. Labor Relations — Police and Fire Departments — Statutes — Construction.
    The purpose of the compulsory arbitration of labor disputes in municipal police and fire departments act is to provide an expeditious and effective means of solving a labor dispute where the public welfare cannot endure the impact of a work stoppage while awaiting the resolution of problems through normal negotiations and ambiguous terms in the act should be interpreted in accordance with public policy and the underlying purpose of the act (MCL 423.231 et seq.; MSA 17.455[31] et seq.).

      References for Points in Headnotes

       48A Am Jur 2d, Labor and Labor Relations § 1773.
    Validity and construction of statutes or ordinances providing for arbitration of labor disputes involving public employees. 68 ALR3d 885.

       48A Am Jur 2d, Labor and Labor Relations § 1891.

       4 Am Jur 2d, Appeal and Error § 76.

      2. Labor Relations — Police and Fire Departments — Retroactive Benefits — Statutes.
    An implicit goal of the compulsory arbitration of labor disputes in municipal police and fire departments act is to provide arbitration awards which approximate agreements that would have been reached in the normal course of collective bargaining; the award of health and insurance benefits retroactively is contemplated by the act, since such benefits are normally included in a private-sector bargaining agreement (MCL 423.231 et seq.; MSA 17.455[31] et seq.).

    3. Appeal and Error — Findings of Fact — Court Rules.
    Findings of fact will not be overturned on appeal unless they are clearly erroneous (GCR 1963, 517.1).

      Lippitt, Harrison, Perlove, Friedman & Zack (by Marc G. Whitefield), for plaintiff.

      W. Thomas Marrocco, Jr., City Attorney, and Walter A. Jakubowski, Jr., Assistant City Attorney, for defendants.
    Before: N. J. Kaufman, P.J., and V. J. Brennan and Bashara, JJ.
   V. J. Brennan, J.

The City of Warren appeals as of right from the March 20, 1978, circuit court order enforcing retroactive health and dental insurance benefits awarded to the Warren Police Officers Association by the collective bargaining arbitration panel.

Contract negotiations between the City of Warren (hereafter defendant) and the Warren Police Officers Association (hereafter plaintiff) reached an impasse in November of 1976, and arbitration proceedings were begun under the compulsory arbitration of labor disputes in municipal police and fire departments act (hereafter the Act), MCL 423.231, et seq.; MSA 17.455(31), et seq. Hearings of the arbitration panel were conducted on various occasions from December 22, 1976, to July 29, 1977, and the award was signed on December 8, 1977. By complaint filed in circuit court on February 15, 1978, the plaintiff sought to enforce the provisions of the award which, as alleged by plaintiff, directed defendant to provide certain health and dental insurance coverage retroactively to July 1, 1977, the first day of the second year of the arbitration award. The circuit court in its order enforcing the award found that the award did provide health and dental insurance coverage retroactively to July 1, 1977, and that such an award does not contravene pertinent provisions of the Act. It is from this order that defendant appeals.

Defendant initially questions the jurisdiction of the arbitration panel to award health and medical insurance benefits retroactively. The pertinent provision of MCL 423.240; MSA 17.455(40), in effect at the time of the award, provided:

"* * * The commencement of a new municipal fiscal year after the initiation of arbitration procedures under this act, but before the arbitration decision, or its enforcement, shall not be deemed to render a dispute moot, or to otherwise impair the jurisdiction or authority of the arbitration panel or its decision. Increases in rates of compensation awarded by the arbitration panel under section 10 may be effective only at the start of the fiscal year next commencing after the date of the arbitration award. If a new fiscal year has commenced since the initiation of arbitration procedures under this act, the foregoing limitation shall be inapplicable, and such awarded increases may be retroactive to the commencement of such fiscal year any other statute or charter provisions to the contrary notwithstanding.”

The defendant contends that in accordance with the above only "increases in rates of compensation” can be awarded retroactively. Further, "rates of compensation” refers to money paid directly to an individual as compensation and does not include health and dental insurance benefits. We disagree with the defendant’s narrow construction of the subject provision.

Initially we point out that the statutory provision in question is rather ambiguous as to its meaning. Since the term "rates of compensation” is not defined in the Act it is open to diverse subjective analysis. Accordingly, we must interpret the term in accordance with the public policy and underlying purpose of the Act. See Ypsilanti Police Officers Ass’n v Eastern Michigan University, 62 Mich App 87; 233 NW2d 497 (1975). The public policy to be furthered by the Act is set forth at MCL 423.231; MSA 17.455(31) as follows:

"It is the public policy of this state that in public police and fire departments, where the right of employees to strike is by law prohibited, it is requisite to the high morale of such employees and the efficient operation of such departments to afford an alternate, expeditious, effective and binding procedure for the resolution of disputes, and to that end the provisions of this act, providing for compulsory arbitration, shall be liberally construed.” (Emphasis added.)

Thus the purpose of the Act is to provide an "expeditious” and "effective” means of solving a labor dispute where, as noted in Justice Williams’s separate opinion in Dearborn Fire Fighters Union Local No 412, IAFF v Dearborn, 394 Mich 229, 293; 231 NW2d 226 (1975), "the public welfare cannot endure the impact of a work stoppage while awaiting the resolution of problems through normal negotiations”. Accordingly, the implicit goal is to provide arbitration awards which approximate agreements that would have been reached in the normal course of collective bargaining. The award of retroactive health and insurance benefits is thus contemplated by the Act since such benefits are normally included in a private-sector bargaining agreement.

The defendant next contends that the lower court erred in finding that the arbitration award included retroactive health and dental insurance benefits to July 1, 1977.

Inasmuch as the trial court’s finding constitutes a factual determination as to the extent of the arbitration award, our review is limited to the question of whether that finding is clearly erroneous. GCR 1963, 517.1.

The dispute regarding the health insurance benefits concerns the defendant’s proposal that any increase in premiums after July 1, 1977, be sustained by the individual officers. The plaintiff proposed that the defendant’s present practice of sustaining increases itself be maintained. In granting the plaintiff’s proposal, the arbitration award most certainly took into account the significance of the July 1, 1977, date. The award also granted the plaintiff’s proposal for dental insurance coverage effective "the second year of the contract”. The second year of the contract commenced July 1, 1977, thus that date’s significance was again emphasized.

Moreover, the plaintiffs last settlement offer clearly labelled health and dental insurance benefits as second-year economic issues, and the defendant did not assail this characterization. The arbitration award provided that "all economic issues were retroactive unless indicated otherwise”. Taking this and the significance of the July 1, 1977, date into account, the trial court’s determination that the awards were retroactive is not clearly erroneous.

We affirm the order of enforcement.

       This portion of the act was subsequently amended to read:
      "* * * The commencement of a new municipal fiscal year after the initiation of arbitration procedures under this act, but before the arbitration decision, or its enforcement, shall not be deemed to render a dispute moot, or to otherwise impair the jurisdiction or authority of the arbitration panel or its decision. Increases in rates of compensation or other beneñts may be awarded retroactively to the commencement of any period(s) in dispute, any other statute or charter provisions to the contrary notwithstanding.” (Emphasis added.)
      There is no question that the act as amended allows for retroactive health and dental insurance benefits.


author: R. M. Maher, J.

text:
    DEPARTMENT OF COMMERCE v DeBEERS DIAMOND INVESTMENT, LTD.
    Docket No. 78-1890.
    Submitted February 8, 1979, at Lansing.
    Decided April 2, 1979.
    Leave to appeal denied, 406 Mich 998.
    Defendant, DeBeers Diamond Investment, Ltd., is an Arizona corporation engaged in the selling of unmounted diamonds to individual purchasers in Michigan for cash with a guarantee that it would repurchase the diamonds sold at any time in the future at the then current market price, i.e., the price for which DeBeers is selling diamonds on the day of purchase. Plaintiff Department of Commerce issued an order to cease and desist selling diamonds with a repurchase guarantee on the grounds that such sales constituted sales of unregistered securities in violation of the Uniform Securities Act. Following a hearing before an administrative law judge, defendant appealed and the Ingham Circuit Court, James T. Kallman, J., affirmed the cease and desist order. Defendant appeals. Held:

    The sale of diamonds with a repurchase guarantee does not constitute the sale of unregistered securities.
    Reversed.
    1. Statutes — Uniform Securities Act — Securities — Investment Contract.
    A transaction is an "investment contract” within the meaning of the Uniform Securities Act where it is a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party; a continuing relationship between the buyer and seller of real or personal property is needed to transform the sale into an “investment contract”, and a simple repurchase agreement is insufficient (MCL 451.801; MSA 19.776[401]).
    References for Points in Headnotes

       69 Am Jur 2d, Securities Regulation-Federal § 26.
    What constitutes an "investment contract” within meaning of state Blue Sky Laws. 47 ALR3d 1375.

       69 Am Jur 2d, Securities Regulation-State § 26.

      2. Statutes •— Uniform Securities Act — Securities —• Diamonds as "Securities”.
    A seller and deliverer of diamonds for cash who neither offers continuing advice and services nor guarantees a return on the purchaser’s investment but who guarantees to repurchase the diamonds at any time in the future at the then current market price does not engage in the sale of securities under the Uniform Securities Act.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Marc A. Goldman, Assistant Attorney General, for plaintiff.

      Milmet, Vecchio, Kennedy & Carnago, P.C., for defendant.
    Before: Bashara, P.J., and V. J. Brennan and R. M. Maher, JJ.
   R. M. Maher, J.

Defendant DeBeers Diamond Investment, Ltd., appeals from the order of the Ingham County Circuit Court affirming a cease and desist order, issued by plaintiff, ordering defendant to cease sales of diamonds to Michigan residents on grounds that such sales constituted sales of unregistered securities in violation of the Uniform Securities Act, MCL 451.501 et seq.; MSA 19.776(101) et seq.

Defendant is an Arizona corporation which, prior to the issuance of the cease and desist order, was engaged in selling unmounted diamonds to individual purchasers in the state of Michigan. DeBeers contacted potential customers through advertisements in The Detroit News and the Detroit Free Press, offering to sell diamonds as an investment and inviting interested persons to call for more information. Those who called the number given in the ad were sent a package of advertising material which included a price list, a chart showing the increase in diamond prices over several years, a guarantee that the appraised value of any diamond purchased would exceed the purchase price by 75%, and assurances that DeBeers would, at any time, buy back any diamond purchased from them at the current prevailing market price.

On June 19, 1975, the Corporation and Securities Bureau of the Department of Commerce issued an order to defendant to cease and desist sales of diamonds with a repurchase guarantee. DeBeers timely requested a hearing on the matter, and a hearing was held on July 8, 1976, before an administrative law judge.

One R. G. Dusenberry testified at the evidentiary hearing that he read defendant’s newspaper advertisement early in 1975 and called the telephone number appearing therein. As a result of the phone call, Dusenberry received the package of materials mentioned above. After obtaining prices at two or three jewelers for unmounted diamonds of a size and quality comparable to those offered by defendant, Mr. Dusenberry telephoned defendant’s sales representative and placed an order. Mr. Dusenberry paid the full purchase price into a local bank and took possession of the diamonds. After taking possession of the diamonds, Mr. Dusenberry inquired of two or three retail jewelers regarding the possibility of selling his diamonds to them, but, encountering a lack of interest in such a transaction, made no further attempt to sell the diamonds.

Mr. Paul Lewis testified at the hearing that he had appraised Mr. Dusenberry’s diamonds prior to the purchase, at the request of defendant. In Mr. Lewis’ opinion, the price at which Mr. Dusenberry purchased the diamonds was a wholesale price, although probably higher than the price which a jeweler would pay. He also testified that jewelers and others in the diamond business would ordinarily not purchase unmounted diamonds from someone they did not know, because of the danger of unwittingly purchasing stolen gems. Mr. Lewis acknowledged, however, that sales to private individuals were a common occurrence. Defendant’s president, Alois Geiger, confirmed Mr. Lewis’ testimony regarding the diamond business. He added that some dealers would accept gems for sale on consignment, although they would not purchase them outright.

The hearing officer, applying the common enterprise test enunciated in Securities & Exchange Comm v W J Howey Co, 328 US 293; 66 S Ct 1100; 90 L Ed 1244 (1946), found that defendant’s sale of diamonds with a buy-back guarantee constituted an "investment contract” and was therefore an unregistered security under the Uniform Securities Act. The Ingham County Circuit Court affirmed. We reverse.

We begin our analysis by noting that our Supreme Court has held that the Uniform Securities Act is to be construed so as to achieve its purposes:

"The Uniform Securities Act carries within itself the statement of its purpose, i.e., to 'make uniform the law of those states which enact it and to coordinate the interpretation and administration of this act with the related federal regulation’. MCL 451.815; MSA 19.776(415). As a matter of judicial policy the act should be broadly construed to effectuate its purposes. Tcherepnin v Knight, 389 US 332, 336; 88 S Ct 548; 19 L Ed 2d 564 (1967). 'In essence this legislation * * * is designed to protect the public against fraud and deception in the issuance, sale, exchange, or disposition of securities within the State of Michigan by requiring the registration of certain securities and transactions.’ Schmidt & Cavitch, Michigan Corporation Law (1974), p 1071.” People v Dempster, 396 Mich 700, 704; 242 NW2d 381 (1976).

In interpreting the Michigan securities statute, we look not only to the interpretations of courts in those other states which have enacted the Uniform Securities Act, but also to interpretations of Federal securities laws:

"While the interpretation Federal courts have placed upon terms under the Federal securities acts is not binding upon state courts as they interpret the Uniform Securities Act, the similarity of the purpose and provisions of the state and Federal securities statutes, particularly those purposes and provisions pertinent to the facts at hand, cannot be ignored. Interpretation of one offers valuable guidelines as to the interpretation of the other.” People v Breckenridge, 81 Mich App 6, 16-17; 263 NW2d 922 (1978).

Courts interpreting securities statutes are careful to look beyond the form of a transaction to its substance, paying special attention to the economic realities of the situation, People v Breckenridge, supra, United Housing Foundation, Inc v Forman, 421 US 837; 95 S Ct 2051; 44 L Ed 2d 621 (1975), Wiener v Brown, 356 So 2d 1302 (Fla App, 1978).

With these principles of statutory construction in mind, we turn to the sole issue presented on appeal: whether the transaction between defendant and Mr. Dusenberry was a mere sale of goods or was, in reality, an investment contract within the meaning of MCL 451.801; MSA 19.776(401).

In reaching the conclusion that the transaction was in fact an investment contract, the hearing officer applied the definition of investment contract used by the Federal courts and first enunciated in Securities & Exchange Comm v Howey, supra, 298-299:

"a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party.”

Defendant urges us to reject the "common enterprise” test in favor of the "risk capital” test applied in the California case of Hamilton Jewelers v Dep’t of Corporations, 37 Cal App 3d 330; 112 Cal Rptr 387 (1974). We reject defendant’s suggestion, preferring to follow the majority of jurisdictions in applying the Howey test. However, we think that a proper application of the Howey test to the facts of this case yields a result different from that reached by the hearing officer.

The hearing officer relied heavily on Securities & Exchange Comm v Brigadoon Scotch Distributors, Ltd, 388 F Supp 1288 (SD NY, 1975), in reaching his decision. In Brigadoon Scotch the defendant, Federal Coin Reserve, Inc. (FCR), sold portfolios of rare coins to those answering advertisements in airline magazines, medical journals and other, similar publications. Advertising brochures sent to inquirers emphasized the investment potential of the coins and offered expert assistance in selecting the coins to be purchased, assistance in selling the coins, accounting services, insurance, tax advice and estate planning services. In addition, purchasers could leave their coins in the custody of FCR. FCR also promised its customers semi-annual accountings, regular financial reports and daily market quotations. Although few purchasers took advantage of the services offered, the Brigadoon court laid great emphasis on the availability of continuing services in finding the scheme to be an investment contract:

"FCR’s brochure itself repeatedly entices its readers with assertions such as that it 'has people working all day long, each and every day making certain that all potential avenues of profit are fully explored.’ * * * In Howey and Joiner [SEC v CM Joiner Leasing Corp, 320 US 344; 64 S Ct 120; 88 L Ed 88 (1943)] the Supreme Court considered such investment-oriented advertising to be factors leading to the finding of an investment contract. SEC v Howey & Co, supra, 328 US at 295, 66 S Ct 1100; SEC v Joiner, supra, 320 US at 346, 64 S Ct 120. As Judge Oakes aptly stated in Glen-Arden [Commodities, Inc v Constantino, 493 F2d 1027 (CA 2, 1974)]:
" 'It ill behooves appellants, after enticing their customers with fancy brochures touting their investment plan, now to claim there was no investment plan but the mere sale of an unadorned commodity.’ 493 F2d at 1034-1035.” SEC v Brigadoon Scotch Distributors, Ltd, supra, p 1292.

In the case at bar, by contrast, defendant offered none of the services which created a continuing relationship between Federal Coin Reserve and its customers. Defendant herein did guarantee to repurchase any diamond sold at the same price at which it was selling diamonds on the repurchase date. However, purchasers were free to sell their stones elsewhere, and there was no built-in incentive to resell to defendant. The hearing officer’s conclusion that buyers were tied to defendant because of the absence of a market for resale of diamonds purchased is simply not supported by the evidence adduced at the hearing. Although Mr. Lewis and Mr. Geiger agreed that an outright sale for cash to a diamond merchant or jeweler was unlikely, they also testified that sales to private individuals were common and that many dealers would accept diamonds from private owners for sale on a consignment basis. The only other evidence regarding market availability was Mr. Dusenberry’s testimony that he had made a few telephone inquiries to retail jewelers and was disappointed with the results. On this record we cannot find evidence sufficient to support the hearing officer’s conclusion regarding the absence of a resale market, cf. Farmers State Bank of Concord v Dep’t of Commerce, Financial Institutions Bureau, 77 Mich App 313; 258 NW2d 496 (1977).

A review of recent cases in other jurisdictions involving sales of real or personal property supports our conclusion that more is needed to create an investment contract than a simple repurchase guarantee. In cases where a sale of property is held to be an investment contract, a continuing relationship between seller and buyer is an essential feature of the transaction. In Lowery v Ford Hill Investment Co, 556 P2d 1201; 84 ALR3d 997 (Colo, 1976), sale of a condominium was found to be an investment contract because the purchasers were required to sign an agreement giving the seller exclusive control over rental of the unit, including the right to set rental rates. In O’Quinn v Beach Associates, — SC —; 249 SE2d 734 (1978), by contrast, no investment contract was found despite an agreement appointing the seller as rental agent, where the service was optional and the buyer retained ultimate control over the condominium. The courts in both cases applied the Howey test. McCown v Heidler, 527 F2d 204 (CA 10, 1975), cited in plaintiffs brief, involved a sale of undeveloped lots in a real estate dévelopment. The court there noted that any expectation of profit depended on the developer successfully completing the project. In the case at bar, diamonds may be expected to appreciate or depreciate independently of any efforts on defendant’s part.

The Supreme Court of Washington, applying the Howey test, held in McClellan v Sundholm, 89 Wash 2d 527; 574 P2d 371 (1978), that sales of silver bars accompanied by selection, storage and resale services, along with continuing advice on the silver market, constituted investment contracts within the meaning of the Uniform Securities Act. Similarly, staff opinions of the Securities and Exchange Commission reach the same conclusion where similar services are offered, see Jim Halperin, Inc [1976-1977 Transfer Binder] Fed Sec L Rep (CCH) ¶ 80,715, Joseph L Aurichio [1976-1977 Transfer Binder] Fed Sec L Rep (CCH) ¶ 80,966, Charles Anthony Diamond Investments, Ltd [1976-1977 Transfer Binder] Fed Sec L Rep (CCH) ¶ 80,623. In Texas Arizona Mining Co, Inc [1971-1972 Transfer Binder] Fed Sec L Rep (CCH) ¶ 78,626, on the other hand, the SEC held that a negotiable contract redeemable for an amount of silver on a date certain, to be guaranteed by a financial institution and sold in expectation of a rise in the price of silver, was not an investment contract. See also Art Appraisers of America, Ltd [1976-1977 Transfer Binder] Fed Sec L Rep (CCH) ¶ 80,796, finding no investment contract involved in sale of packages of selected lithographs, accompanied by an appraisal and tax advice. Cf. Longines Symphonette Society [1972-1973 Transfer Binder] Fed Sec L Rep (CCH) ¶ 79,151 (sale of medallion with cost plus 10% buy-back guarantee is a security).

In Jenson v Continental Financial Corp, 404 F Supp 792 (D Minn, 1975), relied on by plaintiff in its brief, defendant CCEX dealt in gold and silver coins, offering customers the option of purchasing coins for cash or on margin. Ninety percent of sales were margin sales, and 90 percent of margin customers eventually resold their coins to CCEX without ever having taken possession of the coins. CCEX would redeem only its own margin contracts, and CCEX contracts were not recognized by other, similar companies. Contracts were not assignable unless the balance was paid to CCEX. Noting that the investor’s expectation of profits was inextricably intertwined with the success or failure of CCEX’s enterprise, the Jenson court found that CCEX’s margin contracts were investment contracts. Accord, State v Coin Wholesalers, Inc, 250 NW2d 583 (Minn, 1976), applying Minnesota test (see footnote 3, supra).

In the case at bar, defendant neither sells on margin, offers continuing advice and services, nor guarantees a return on the purchaser’s investment. Sales are for cash, and the purchaser immediately takes possession of the diamonds. Purchasers may elect, but are not required either by contract or by circumstances, to resell the diamonds to defendant at some time in the future. The case before us is thus distinguishable on its facts from those cases in which a purported sale of property has been found to be an investment contract. Even the most expansive interpretation of the Howey test has not gone so far as plaintiff would have us go in this case, see SEC v Brigadoon Scotch Distributors, Ltd, supra. We do not read the cases interpreting the Uniform Securities Act and similar statutes as holding that advertisements which offer commodities as investments, coupled with a guarantee to buy the goods back at market price, are sufficient to transform a simple sale of personalty into an investment contract.

The order of the circuit court is reversed and the cease and desist order is vacated. No costs, a public question being involved.

       Defendant’s president, Alois Geiger, testified at the evidentiary hearing held before a hearing examiner that the current prevailing market price meant the price at which DeBeers was selling diamonds on the day of repurchase.

       Security is defined in MCL 451.801(1); MSA 19.776(401)(1) to include an investment contract.

       A third test is applied in Minnesota, where an investment contract is defined as "the placing of capital or laying out of money in a way intended to secure income or profit from its employment”. State v Coin Wholesalers, Inc, 250 NW2d 583, 588 (Minn, 1976).

       See Anno: What constitutes an "investment contract” within the meaning of state blue sky laws, 47 ALR3d 1375.

       Compare Investment Diamonds, Inc [1971-1972 Transfer Binder] Fed Sec L Rep (CCH) ¶ 78,350, where the Securities and Exchange Commission in a staff opinion found an investment contract in a sale of diamonds accompanied by options either to resell to seller at a predetermined price or to trade in a diamond on a larger stone for a credit amount larger than the repurchase price. The opinion emphasized that the scheme made the trade-in option so much more advantageous to the buyer that its effect was to tie the buyer’s fortunes to those of the seller in his search for profit.

       Mr. Dusenberry testified that he "nosed around a little bit” and was told by one jeweler to bring the stones in and "I’ll see what I can do for ya”. Mr. Dusenberry did not take his diamonds to the jeweler.

       Both Colorado and South Carolina have enacted the Uniform Securities Act.


author: Per Curiam.

text:
    THE METRO CLUB, INC v SCHOSTAK BROTHERS & COMPANY, INC
    Docket No. 78-1872.
    Submitted March 20, 1979, at Detroit.
    Decided April 2, 1979.
    Leave to appeal denied, 406 Mich 995.
    The Metro Club, Inc., sought on several occasions to rent temporary space in the corridors of Macomb Mall during the Christmas season for the purpose of offering for sale its "discount passbook”. Roseland Shopping Center, owner of Macomb Mall, through its managing agent, Schostak Brothers & Company, Inc., consistently refused to lease to plaintiff, although it consistently leased space to plaintiffs principal competitor. The decision to refuse to lease space to plaintiff was made by the chief operating officer of Schostak Brothers and the manager of the mall, an employee of Schostak Brothers. Plaintiff brought an action against Schostak Brothers & Co., Inc., and Roseland Shopping Center, doing business as Macomb Mall, for injunctive relief, alleging restraint of trade and competition. The Macomb Circuit Court, George R. Deneweth, J., dismissed plaintiffs complaint after finding that there was neither a prohibited agreement nor an illegal restraint of trade nor interference with competition. Plaintiff appeals. Held:

    1. Plaintiff failed to establish an illegal combination as required by the Michigan restraint of trade statute, since an agent and employees of an agent are regarded as a single actor.
    2. Refusal to lease space in a shopping center does not constitute a restraint of trade under the Michigan restraint of trade statute, as evaluated in accordance with the rule of reason, where such refusal to lease did not harm the public or stifle competition.
    Affirmed.
    1. Monopolies — Restraint of Trade — Agents — Employees — Statutes.
    The requirement of the Michigan restraint of trade statute that there be a combination of capital, skill or arts by two or more persons, firms, partnerships, corporations or associations is not established by a combination of an agent and employee of the agent working on behalf of a single principal (MCL 445.701; MSA 28.31).

      References for Points in Headnotes

       54 Am Jur 2d, Monopolies, Restraints of Trade, and Unfair Trade Practices § 458.

       54 Am Jur 2d, Monopolies, Restraints of Trade, and Unfair Trade

      2. Monopolies — Restraint of Trade — Rule of Reason — Statute.
    Refusal to lease space in a shopping center does not constitute a restraint of trade or competition under the Michigan restraint of trade statute, as evaluated in accordance with the rule of reason, where such refusal to lease did not harm the public or stifle competition (MCL 445.701; MSA 28.31).

      Lawrence W. Rattner, for plaintiff.

      Maddin & Maddin, for defendant.
    Before: D. C. Riley, P.J., and M. J. Kelly and Beasley, JJ.
   Per Curiam.

Plaintiff publishes and markets in the Detroit metropolitan area a product known as the Metro Book, a "discount passbook” consisting of several hundred coupons which entitles the bearer to purchase entertainment, meals and other services at reduced prices at designated establishments. Defendants are-the managing agent and owner, respectively, of the Macomb Mall, a large enclosed shopping center in Macomb County. Plaintiff sought on several occasions to rent temporarily a kiosk in the corridors of Macomb Mall during the Christmas shopping season, in order to offer its passbooks for sale to shoppers. Defendants consistently refused to lease to plaintiff, but just as consistently rented a kiosk to plaintiffs principal competitor, Sports Unlimited, Inc., which marketed a similar discount passbook.

After learning that its attempts to lease space in Macomb Mall for the 1975 Christmas selling season had been rejected again, plaintiff brought this action alleging that defendants’ conduct restrained trade and competition in violation of the basic Michigan antitrust statute, MCL 445.701; MSA 28.31, and should be enjoined. No preliminary relief was granted. The circuit court heard the case without a jury on April 27 and April 28, 1978.

At the close of the proofs, the trial judge concluded that plaintiff had proven neither a prohibited agreement nor an illegal restraint of trade nor interference with competition. We agree and affirm.

Insofar as is pertinent to plaintiffs complaint, MCL 445.701; MSA 28.31 defines an illegal trust as,

"a combination of capital, skill or arts by 2 or more persons, firms, partnerships, corporations or associations of persons, or of any 2 or more of them, for either, any or all of the following purposes:
"1. To create or carry out restrictions in trade or commerce;
"3. To prevent competition in manufacturing, making, transportation, sale or purchase of merchandise, produce or any commodity.”

At the threshold, plaintiff failed to demonstrate the requisite combination of two or more entities. No evidence established, or even plausibly suggested, that defendants had conspired or acted in concert with any third party, including Sports Unlimited, in refusing to deal with plaintiff. Jerome Schostak, the chairman and chief executive officer of defendant Schostak Brothers & Company, Inc., and David Brock, an employee of Schostak Brothers who managed the mall’s day-to-day operations, maintained that the decision not to lease space to plaintiff was a unilateral managerial decision based upon a number of factors, notably their desire to obtain a better "tenant mix” which would increase the diversity of goods available to shoppers. Brock also wished to maintain the satisfactory existing relationship with Sports Unlimited.

So far as the testimony indicates, only Schostak and Brock participated in the decision to exclude plaintiff. Each acted in his capacity as officer or employee of Schostak Brothers, which in turn served as managing agent for Roseland Shopping Center. Thus, all of the conduct of which plaintiff complains was performed on behalf of the same principal: Roseland Shopping Center (Macomb Mall). The statute which plaintiff invokes plainly contemplates "a combination of capital, skill or arts” by a plurality of actors. Other states with similar antitrust statutes modeled after the Sherman Act have concluded that an agent and his principal, or an employee and his corporate employer, may not be counted separately for purposes of finding a proscribed combination, so long as the agent or employee acts only within the scope of his agency of employment. Padgitt v Lone Star Gas Co, 213 SW2d 133, 136 (Tex Civ App, 1948), Bondi v Jewels by Edwar Ltd, 73 Cal Rptr 494, 498; 267 Cal App 2d 672 (1968), Exxon Corp v Wagner, 154 NJ Super 538; 382 A2d 45, 48 (1977). The Federal courts have arrived at a similar interpretation of § 1 of the Sherman Act, 15 USC § 1. See Anno: 20 ALR Fed 682 (1974). Upon the present facts, defendants, Schostak, and Brock must be regarded as a single actor.

Nor did plaintiff establish that defendants had acted with a forbidden purpose to restrain trade or prevent competition, or that the anti-competitive effects of defendants’ conduct necessarily indicated such a purpose. An alleged restraint of trade should be evaluated in accordance with the rule of reason. People, ex rel Attorney General v Detroit Asphalt Paving Co, 244 Mich 119, 127; 221 NW 122 (1928), Barrows v Grand Rapids Real Estate Board, 51 Mich App 75, 83-88; 214 NW2d 532 (1974). The trial judge concluded that the public was not harmed, nor was competition in discount passbooks stifled, because of defendants’ refusal to lease a kiosk to plaintiff. Plaintiff marketed its passbook in other shopping malls within the same general region. Indeed, Metro Books were sold in the customer service office of one of Macomb Mali’s major chain stores, and defendants’ counsel represented to the court that plaintiff could market its passbook through any regular tenant whose lease permitted it to sell general merchandise. Thus, even if plaintiff had successfully demonstrated a plurality of actors, a covenant against leasing to competitors, and a relevant market, the restrictive or anti-competitive effect of its inability to obtain a kiosk would not have been cognizable under the rule of reason. The trial court’s findings and conclusions in this regard are amply supported by the evidence.

Underlying the trial judge’s decision was his view that a landlord "is not required to accept every tenant who comes with the money in hand to pay the rent”, so long as no discriminatory or otherwise illegal purpose for refusal is involved. The trial judge characterized defendants’ conduct as an exercise of their "legitimate managerial prerogative” to choose the parties with whom they would deal. While we do not predicate our holding on this position, we note that individual refusals to deal have generally been held not to be prohibited under state antitrust laws. 54 Am Jur 2d, Monopolies, Restraints of Trade, and Unfair Trade Practices, § 581, p 1006.

Plaintiffs second assignment of error is without merit.

Affirmed.


text:
    BERG-POWELL STEEL COMPANY v THE HARTMAN GROUP
    Docket No. 78-582.
    Submitted February 14, 1979, at Detroit.
    Decided April 2, 1979.
    Berg-Powell Steel Company filed a complaint against the Hartman Group, as the broker for Herman Rasch, for the return of a $5,000 deposit paid to Hartman in conjunction with an offer to purchase certain real estate. The purchase agreement was to be void if certain permits could not be obtained by plaintiff. The permits could not be obtained to plaintiffs satisfaction, and Hartman was notified but did not return the deposit. Hartman counterclaimed for interpleader asserting that Rasch, as vendor, claimed the contract was binding and that he had a right to the deposit. Rasch was made a party to the action and counterclaimed for specific performance. Plaintiff moved for summary judgment, claiming that it was entitled to withdraw its offer because Rasch’s wife had not signed the purchase agreement which made the agreement unenforceable under the statute of frauds. Motion for summary judgment granted, Oakland Circuit Court, Frederick C. Ziem, J., on the ground that the agreement was unenforceable due to the absence of the wife’s signature. Defendant Rasch appeals claiming that the trial judge erred in considering plaintiffs arguments in support of the motion for summary judgment because they were not raised in plaintiffs pleadings. Held:

    1. Technically defendant is correct. A court rule provides that arguments in support of a motion for summary judgment should be raised in a petitioner’s pleadings or by timely amendment; however, the liberal policy in favor of permitting the amendment of pleadings does not call for a reversal for court rule violation where, although the arguments were not raised in the pleadings and no motion to amend was proffered, plaintiff would have been permitted to amend his pleadings had a motion been filed, defendant had notice of the issues raised, had fully briefed them and was not prejudiced thereby.'

      References for Points in Headnotes

       73 Am Jur 2d, Summary Judgment § 29.

       73 Am Jur 2d, Summary Judgment §§ 12-15, 29.

       72 Am Jur 2d, Statute of Frauds § 366.

       67 Am Jur 2d, Sales § 76.
    41 Am Jur 2d, Husband and Wife § 187.

      2. A seller’s wife, with an interest in real estate to be sold, must sign a purchase agreement to signify her acceptance between the parties and no valid contract can be created without her signature. A contract for the sale of land where the required signatures are absent is in violation of the statute of frauds and is void and unenforceable.
    Affirmed.
    1. Judgment — Summary Judgment — Pleading — Amendment — Prejudice — Court Rules.
    A court rule provides that each party shall be given opportunity to amend his pleadings in conjunction with a motion for summary judgment unless the evidence then before the court shows amendment would not be justified (GCR 1963, 117.3).
    2. Judgment — Summary Judgment — Pleading — Amendment — Motions — Notice of Issues — Prejudice — Court Rules.
    A court rule provides that arguments in support of a motion for summary judgment should be raised in a petitioner’s pleadings or by timely motion for amendment; however, the liberal policy in favor of permitting the amendment of pleadings does not call for a reversal for court rule violation where, although the arguments were not raised in the pleadings and no motion to amend was proffered, petitioner would have been permitted to amend his pleadings had a motion been filed, defendant had notice of the issues raised, had fully briefed them and was not prejudiced thereby (GCR 1963, 117.3).
    3. Frauds, Statute of — Contracts — Land Sales — Required Signatures — Statutes.
    The statute of frauds requires that every contract for the sale of land must be signed by the party by whom the sale is to be made and each holder of an undivided one-half interest in property to be sold must sign; a contract for the sale of land where the required signatures are absent is in violation of the statute of frauds and is void (MCL 566.108; MSA 26.908).
    4. Frauds, Statute of — Contracts — Offer and Acceptance — Land Sales — Deposits — Required Signatures — Wife’s Interest — Dower — Statutes.
    An offer to purchase land may be withdrawn prior to acceptance by requesting a refund of deposit where the wife of the seller, with a dower interest, fails to sign the agreement; a seller’s wife, with an interest in the land to be sold, should sign a contract for the sale of land to signify her acceptance of the agreement and unless she signs there is no acceptance between the parties and no valid contract can be created (MCL 558.1, 566.108; MSA 26.221, 26.908).

      Stark & Reagan, P.C. (by Michael H. Whiting), for plaintiff.

      Frimet, Goren & Bellamy, P.C. (by Alan G. Gilchrist), for defendant.
    Before: Cynar, P.J., and D. E. Holbrook, Jr. and D. C. Riley, JJ.
   Per Curiam.

Defendant Herman Rasch (hereinafter referred to as defendant) appeals as of right from a summary judgment entered against him in a case involving the return of a $5,000 deposit, paid by plaintiff to defendant’s broker pursuant to an offer to purchase real estate.

In a complaint filed September 22, 1976, plaintiff filed an action against defendant Hartman Group, who, allegedly as broker for defendant, was paid $5,000 in conjunction with an offer to purchase certain real estate. This offer was contained in a purchase agreement which was signed by defendant and an agent of plaintiff’s. It was conditioned upon plaintiff obtaining certain permits and provided that the agreement would be void and the deposit money returned if the permits could not be obtained to its satisfaction. The complaint further alleged that plaintiff could not obtain the permits, but, upon notifying the Hartman Group, was unable to obtain the return of its deposit.

The Hartman Group answered and counterclaimed for interpleader, asserting that defendant, as vendor of the subject property, claimed a right to the deposit. Defendant was subsequently made a party to the action. He claimed that he had a binding agreement with plaintiff for the purchase of the property. He contended that plaintiff’s failure to obtain an occupancy permit constituted a breach of the contract and counterclaimed for specific performance of the contract.

In a motion dated October 4, 1977, plaintiff moved for summary judgment under GCR 1963, 117.2(3), claiming it was entitled to judgment as a matter of law. In support of this motion plaintiff noted defendant’s deposition testimony admitting that he was married at the time of the alleged acceptance of the purchase agreement and that his wife had not signed the agreement. Plaintiff argued that it was entitled to withdraw its offer, as the contract, prior to her acceptance, was unenforceable under the statute of frauds, MCL 566.108; MSA 26.908. In addition, plaintiff noted that the purchase agreement contained the phrase "if seller is married, wife must sign” directly below the line indicated for the seller’s acceptance. In an order dated January 25, 1978, the trial judge ruled that the agreement was unenforceable due to the absence of defendant’s wife’s signature and granted plaintiff’s motion for summary judgment.

Defendant initially contends that the trial court erred in considering plaintiff’s arguments in support of the motion for summary judgment because they were not raised in plaintiff’s pleadings. Technically defendant is correct. Initially plaintiff was proceeding on the theory that the contract was unenforceable due to the nonoccurrence of the condition precedent regarding the permits. After learning that defendant was married, it failed to amend its complaint to raise the arguments contained in support of the summary judgment motion. Nor were these arguments raised in the answer to defendant’s counterclaim and, under GCR 1963, 111.3, were waived.

However, GCR 1963, 117.3 provides that, in conjunction with a motion for summary judgment:

"Each party shall be given opportunity to amend his pleadings as provided by Rule 118 unless the evidence then before the court shows amendment would not be justified.”

In light of the early stage of the proceedings, plaintiff’s recent discovery of defendant’s marital status and the liberal policy in favor of permitting the amendment of pleadings, Ben P Fyke & Sons v Gunter Co, 390 Mich 649, 656; 213 NW2d 134 (1973), plaintiff would have been permitted to amend its pleadings had it so moved. Although no such motion was ever proffered, defendant was not prejudiced thereby. It had notice of the issues raised and fully briefed them. Under these circumstances, reversal is not required. See Gellenbeck v Sears, Roebuck & Co, 59 Mich App 339, 341-342; 229 NW2d 443 (1975).

Defendant also argues that the trial judge erred in granting plaintiff’s motion for summary judgment. We disagree. The statute of frauds, MCL 566.108; MSA 26.908, requires that every contract for the sale of land must be signed by the party "by whom the * * * sale is to be made”. The statute was interpreted in Fields v Korn, 366 Mich 108; 113 NW2d 860 (1962), to require the signature of each holder of an undivided one-half interest in the property being sold. In the absence of the required signatures, the Court in Fields ruled that the contract for the sale of the land was void, as a violation of the statute of frauds.

Although in the instant case we are dealing with the dower interest of defendant’s wife, MCL 558.1; MSA 26.221, we find this distinction insignificant and conclude that Fields controls this situation as well. Since there was no acceptance between the parties in this case by defendant’s wife of plaintiffs offer to purchase the property, no valid contract was ever created. Plaintiff was free to withdraw its offer prior to acceptance by requesting a refund of its deposit. Board of Control of Eastern Michigan University v Burgess, 45 Mich App 183, 186-187; 206 NW2d 256 (1973).

Affirmed. Costs to plaintiff.

       Because of our resolution of this issue we need not discuss the effect, if any, of the phrase "if seller is married, wife must sign” contained in the purchase agreement.


text:
    CITIZENS INSURANCE COMPANY OF AMERICA v DETLOFF
    Docket No. 78-2348.
    Submitted February 7, 1979, at Lansing.
    Decided April 2, 1979.
    Leave to appeal applied for.
    Paula Detloff, a minor pedestrian, was injured when struck by a forklift on a public highway. Her father, Marvin Detloff, sought to recover benefits from his automobile insurer, Citizens Insurance Company of America. Citizens brought an action seeking a declaration that it was not liable to the Detloffs. Citizens moved for summary judgment and the Macomb Circuit Court, Edward J. Gallagher, J., denied the motion. Citizens appeals by leave granted, arguing that its policy of insurance incorporates all of the Michigan Insurance Code and that, despite the language of the policy, the code operates to relieve the insurer of liability because the forklift was not a vehicle required to be registered as a motor vehicle. Held:

    Denial of the motion for summary judgment was proper. The definition of "motor vehicle” contained in the insurance policy includes the forklift. The language of the definition is identical to the statutory definition of a motor vehicle, thus there is no conflict with the statute. The insurer could have utilized the more limited language of another section of the statute but chose not to do so. There is no ambiguity in the policy.
    Affirmed.
    1. Automobiles — Insurance — Motor Vehicle — Definition — Statutes.
    An express definition of a "motor vehicle” contained in an insurance policy controls the question of whether a vehicle is a “motor vehicle” for purposes of the policy where the insurer chose to incorporate specific language from one portion of the controlling statute defining a "motor vehicle” in terms broader than those used in another portion of the statute (MCL 500.3101; MSA 24.13101).
    References for Points in Headnotes

       7 Am Jur 2d, Automobile Insurance § 7.
    Automobile liability insurance: operator’s policies. 88 ALR2d 995.

       7 Am Jur 2d, Automobile Insurance § 46.

      2. Insurance — Contracts —■ Ambiguities.
    Ambiguities in a contract of insurance are to be construed against the author of the contract.

      Halsey, Halsey & Pommerening, for plaintiff.

      Martin J. Smith, for defendants.
    Before: Bashara, P.J., and V. J. Brennan and R. M. Maher, JJ.
   Per Curiam.

Citizens Insurance Company of America brought an action seeking a declaration that it was not liable to its insureds Marvin Detloff and Paula Detloff under either its contract of insurance or Chapter 31 of the Insurance Code of 1956 as amended, MCL 500.3101 et seq.; MSA 24.13101 et seq. Its motion for summary judgment was denied and leave for interlocutory appeal was granted.

On or about June 4, 1976, the minor defendant Paula Detloff was a pedestrian on a public highway in Macomb County. She was struck and severely injured by a forklift which was being driven from one construction site to another. The forklift was owned by the Hajduk Construction Company and was not insured as a motor vehicle, was not registered with the Secretary of State, and carried no license plate. The forklift has four wheels and is powered by an internal combustion engine. It is conceded that the machine was being operated on a public highway at the time of the incident. Paula’s father, defendant Martin Detloff, is the insured under a "no-fault” insurance policy issued by the plaintiff Citizens Insurance Company of America (Citizens).

The controversy arises out of the following language contained in the policy:

"The Company will pay in accordance with Chapter 31 of the Michigan Insurance Code to or on behalf of each eligible injured person or his dependent survivors, personal protection benefits consisting of
"(a) allowable expenses
"(b) work loss, and
"(c) survivor’s loss
"as a result of the ownership, operation, maintenance, or use, including loading or unloading of a motor vehicle as a motor vehicle.
" 'Motor vehicle’ means a vehicle, including a trailer, operated or designed for operation upon a public highway by power other than muscular power which has more than two wheels.”

MCL 500.3101; MSA 24.13101 provides in pertinent part as follows:

"Sec. 3101. (1) The owner or registrant of a motor vehicle required to be registered in this state shall maintain security for payment of benefits under personal protection insurance, property protection insurance, and residual liability insurance. Security shall be in effect continuously during the period of registration of the motor vehicle.
"(2) 'Motor vehicle’ as used in this chapter, except for section 3103, means a vehicle, including a trailer, operated or designed for operation upon a public highway by power other than muscular power which has more than 2 wheels, but does not include a moped * * * [citation omitted].
"(3) Security may be provided under a policy issued by an insurer duly authorized to transact business in this state which affords insurance for the payment of such benefits. A policy of insurance represented or sold as providing security shall be deemed to provide insurance for the payment of the benefits.” (Emphasis supplied).

As can be seen the definition of "motor vehicle” in the insurance contract is exactly that set forth in § 3101(2). Citizens does not argue that this language does not include the forklift for it had more than two wheels, was powered by an internal combustion engine, and was in fact being operated on a public highway when the accident occurred. Citizens, however, does argue that the insurance contract incorporates all of Chapter 31 of the Michigan Insurance Code and claims that § 3101(1) of Chapter 31 operates to relieve it of liability, despite the definition in its insurance contract, because the forklift is not required to be registered. We cannot agree.

There is no conflict between the contract of insurance and the above-quoted statute, nor does the reference to Chapter 31 create an ambiguity, as Citizens argues. Citizens was free to have incorporated the specific language of § 3101(1) into its definition of "motor vehicle”, thus limiting the definition of "motor vehicle” to those vehicles requiring registrations. Citizens chose not to do so, instead incorporating the broader definition of § 3101(2). The express definition must control.

Assuming arguendo that, as Citizens contends, the phrase "the company will pay in accordance with Chapter 31 of the Michigan Insurance Code” incorporates the registered vehicle limitation of § 3101(1) and is not overridden by the inclusion of the express definition of "motor vehicle” drawn from § 3101(2), we would still be inclined to affirm the decision of the trial court. If such were the case a true ambiguity would exist.

However, when ambiguities exist in a contract of insurance they are to be construed against the author of the contract. Dochod v Central Mutual Ins Co, 81 Mich App 63; 264 NW2d 122 (1978), citing Nickerson v Citizens Mutual Ins Co, 393 Mich 324, 330; 224 NW2d 896 (1975), which set forth the principle that ambiguous language in an insurance contract was to be "strictly construed against the insurer”.

We note that the trial court did not consider the language to be ambiguous. The motion for summary judgment asked for a decision based upon the contract as well as upon Chapter 31. The decision of the trial court based upon the contractual language was correct.

Affirmed. Costs to appellees.


text:
    PEOPLE v HAMPTON
    Docket No. 26847.
    Submitted February 22, 1977, at Detroit.
    Decided March 24, 1977.

      Lv den, 400 Mich 861 (1977), cert den, 435 US 932 (1978).
    Robert Hampton was convicted of felonious assault. Defendant had three prior trials on the same charge which resulted in hung juries. In the first three trials he was represented by the same attorney. In the fourth trial he was represented by new counsel from the public defender’s office who requested the transcripts of the first and third trials. These transcripts were sought to impeach prosecution witnesses despite the fact that defendant had previously been provided with copies of his preliminary examination and the second trial transcript. Thomas J. Foley, J., Wayne Circuit Court, denied the request. Defendant appeals, contending denial of the transcripts was error. Held:

    1. An indigent criminal defendant is entitled to the transcripts of earlier trials at state expense prior to a new trial on the same charge for purposes of discovery and as a tool for the impeachment of prosecution witnesses.
    2. The defendant needed the prior trial transcripts and denial of his request was error. There was a voluminous trial transcript, three previous hung juries, the fourth jury deliberated four days before reaching a verdict and the attorney for the fourth trial, who had not represented defendant at prior trials, employed a new strategy by having defendant testify in his own behalf for the first time. Obviously, various aspects of earlier testimony on the part of witnesses could become crucial to defendant’s defense and without the benefit of the other transcripts defendant would be unable to discover inconsistencies in the prior testimony of the witnesses.
    Reversed and remanded.
    References for Points in Headnotes

       21 Am Jur 2d, Criminal Law § 233.
    58 Am Jur 2d, New Trial § 210.
    Rights of indigent defendant in criminal case to aid of state as regards new trial or appeal. 55 ALR2d 1072.

      Criminal Law — Indigents — New Trial — Transcripts.
    An indigent criminal defendant is entitled to the transcripts of earlier trials at state expense prior to a new trial on the same charge; transcripts of prior trials should be valuable to the defendant as a discovery device in preparation for trial and as a tool at the trial itself for the impeachment of prosecution witnesses.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward R. Wilson, Research, Training & Appeals, and Maura D. Corrigan, Assistant Prosecuting Attorney, for the people.

      Raymond E. Willis, for defendant.
    Before: N. J. Kaufman, P.J., and V. J. Brennan and M. D. O’Hara, JJ.

       Former Supreme Court Justice, sitting on the Court of Appeals by assignment pursuant to Const 1963, art 6, § 23 as amended in 1968.

   Per Curiam.

Defendant appeals from a verdict by a jury in Wayne County Circuit Court convicting him of felonious assault, in violation of MCLA 750.82; MSA 28.277. Counsel for the defendant have strongly contended in this appeal that the case has numerous errors entitling defendant to reversal. We are of the view that one issue is dispositive and, therefore, reverse.

Though we reverse, our disposition herein cannot be satisfactorily understood without reference to the posture of events below. Defendant has now faced trial on this same charge on four occasions. All four trials occurred during a three-month period. The first three trials resulted in hung juries. In the instant trial, the jury deliberated four days before rendering its verdict.

Throughout the course of these proceedings, defendant has been represented by the Legal Defenders Office. At the time of the fourth trial, the attorney who had represented defendant in the first three trials was unable to participate. An adjournment was requested to allow time for the original attorney to handle the fourth trial. The motion was denied. As a result, new counsel from the defender’s office was brought in to handle the trial.

Prior to the fourth trial, defendant’s new counsel requested the trial transcripts of the first and third trials. This was sought despite the fact that the defendant had been previously provided with copies of the- preliminary examination and second trial transcript. His request was premised upon People v Glass, 38 Mich App 735; 197 NW2d 140 (1972). At the time of this request he stated:

"I would submit to the Court that perhaps discovery is not the main thrust in this motion, it is impeachment. You have a situation where you have two eye witnesses, and at the time of the trial they decide to bring in the second eye witness, considering the witness was going to testify to the modus operandi of my client. I submit the impeachment is of the utmost importance. That is what the case is all about, eye witness testimony. If ever there was a situation where impeachment possibility is available, it should be made available. You have a long trial, and you get mixed up with a secondary issue, and in this case eye witness identification. That is what we need it for.”

The trial judge reached a result contrary to defendant’s position on the basis of essentially the following facts:

"This case was a short trial. It was a comparatively simple trial. We have the examination testimony, you have the complete transcript of the second triaí, requested by the defendant, and adjournment was granted for that purpose. The third trial again repeated that which was in the second trial.”

Again, as in the court below, defendant contends that the trial judge’s denial of the transcripts was error. We agree.

In Glass, the Court held that an indigent criminal defendant was entitled to a transcript of his first trial at state expense prior to a new trial, even though he was represented by the same lawyer at both trials. In reaching this result, Judge, now Justice, Levin quoted approvingly the following language from Britt v North Carolina, 404 US 226, 228; 92 S Ct 431; 30 L Ed 2d 400 (1971):

" 'We agree with the dissenters that there would be serious doubts about the decision below if it rested on petitioner’s failure to specify how the transcript might have been useful to him. Our cases have consistently recognized the value to a defendant of a transcript of prior proceedings, without requiring a showing of need tailored to the facts of the particular case. As Mr. Justice Douglas makes clear, even in the absence of specific allegations it can ordinarily be assumed that a transcript of a prior mistrial would be valuable to the defendant in at least two ways: as a discovery device in preparation for trial, and as a tool at the trial itself for the impeachment of prosecution witnesses.’ * * * (Emphasis supplied.)” 38 Mich App at 738.

We think Glass governs our result here. It is, of course, true that the instant case differs from Glass in that all of the trials occurred within a three-month period. Moreover, defendant was given copies of the second trial and the preliminary examination transcripts prior to the third trial. But, by the same token, there are dissimilarities which suggest that the need was even greater than in Glass.

In the instant case, defendant was now being represented by different counsel. We do not overlook or minimize the consideration that he was from the same office as original counsel. But this hardly suffices to let him delve into the inconsistencies in a witness’s prior testimony. He was not dealing with a faulty memory of earlier trials but, rather, he was dealing without the benefit of any recollection.

The transcripts provided did not rectify this deficiency. This attorney employed a strategy quite different from that of his predecessor. For example, this was the first time defendant testified in his own behalf. Thus, based upon this alteration of trial tactics, various aspects of earlier testimony on the part of the witnesses could become crucial to defendant’s defense. Obviously, without the benefit of the other transcripts, the defendant would be unable to discern the inconsistencies in the prior testimony of the witnesses.

Finally, it is also urged by the prosecutor that this was a relatively simple case and the transcript was unnecessary to defendant’s defense. The record belies this assertion. We have a voluminous transcript in the instant case. As was noted previously, there were three prior hung juries. The fourth jury deliberated four days before reaching a verdict. As the trial judge stated in rejecting defendant’s assertion that four days of deliberation amounted to coercion to reach a verdict:

"It has been a very lengthy trial, the evidence is voluminous, extensive cross examination; and in actuality the time used by the jury to this point, relatively speaking, has not been a long time to deliberate on everything that has gone into this record.”

For the above-stated reasons, we reverse and remand.

       We note that the defendant testified because the trial judge suppressed any references to his prior criminal record. See People v Jackson, 390 Mich 621; 212 NW2d 918 (1973).


text:
    CHRISTIANSEN v EATON, YALE & TOWNE, INC
    Docket No. 77-1442.
    Submitted May 3, 1978, at Marquette.
    Decided September 6, 1978.
    Plaintiff, Harlon S. Christiansen, was injured during the course of his employment with defendant Eaton, Yale & Towne, Inc., with the injury ultimately requiring hospitalization and surgery. Workmen’s compensation benefits were voluntarily paid from September, 1969, through May, 1970, and from October, 1970, to August, 1973. In July, 1973, after receiving a medical opinion that Christiansen could perform a job that did not involve heavy lifting, Eaton contacted plaintiff concerning possible light work. Plaintiff appeared at defendant’s plant, but refused to look at the possible jobs. The workmen’s compensation referee determined that benefits were properly terminated by reason of plaintiff’s refusal of favored work. The Workmen’s Compensation Appeal Board affirmed the referee’s determination. Plaintiff appeals by leave granted. Held:

    1. The favored work provision of the Worker’s Disability Compensation Act requires that an injured employee make a good faith attempt to perform favored work which has been offered in good faith; the refusal of such favored work by the injured employee terminates the employee’s right to continued workmen’s compensation benefits.
    2. The remedy under the favored work provision of the Worker’s Disability Compensation Act is distinct from the remedy under the vocational rehabilitation provision of the act, and the former is not impliedly repealed by the latter.
    3. The favored work provision of the Worker’s Disability Compensation Act does not violate an injured employee’s constitutional rights of equal protection and due process.
    Affirmed.
    1. Workmen’s Compensation — Favored Work — Good Faith.
    The favored work provision of the Worker’s Disability Compensation Act requires that an injured employee make a good faith attempt to perform favored work which has been offered in good faith; the refusal of such favored work by the injured employee terminates the employee’s right to continued workmen’s compensation benefits.

      References for Points in Headnotes

       82 Am Jur 2d, Workmen’s Compensation § 349.

       82 Am Jur 2d, Workmen’s Compensation § 387.

       81 Am Jur 2d, Workmen’s Compensation §§ 16, 17.

      2. Workmen’s Compensation — Favored Work — Vocational Rehabilitation.
    The remedy under the favored work provision of the Worker’s Disability Compensation Act is distinct from the remedy under the vocational rehabilitation provision of that act, and the former is not impliedly repealed by the latter (MCL 418.319; MSA 17.237[319]).
    3. Workmen’s Compensation — Favored Work — Constitutional Law.
    The favored work provision of the Worker’s Disability Compensation Act does not violate an injured employee’s constitutional rights of equal protection and due process.

      Wisti & Jaaskelainen, for plaintiff.

      Hansley, Neiman, Peterson, Beauchamp & Stupak, P.C., for defendants.
    Before: V. J. Brennan, P.J., and R. B. Burns and M. J. Kelly, JJ.
   Per Curiam.

On March .28, 1977, the Michigan Workmen’s Compensation Appeal Board affirmed the July 15, 1974, decision of the referee which denied plaintiff workmen’s compensation benefits on the ground that plaintiff had refused favored work. Plaintiff appeals this order by leave granted on August 11, 1977.

On July 17, 1969, plaintiff was employed by defendant when, during the course of his employment, he was injured while attempting to put an air filter on a lathe. Plaintiff continued working until September, when he was hospitalized and put in traction. He had a back operation (laminectomy) in October. Defendants voluntarily paid workmen’s compensation benefits for the period from September, 1969 through August 9, 1973. During this time plaintiff returned to work for a five-month period between May 24, 1970, and October 6, 1970. During this five-month period he worked on tool and die making. Plaintiff’s reason for leaving this job at the conclusion of the five-month period was that he reinjured his back. In response to a petition for compensation benefits filed May 12, 1971, defendant Eaton voluntarily commenced benefits and the petition was dismissed August 26, 1971.

In March of 1973 plaintiff was examined by Dr. James W. Lyons, a specialist in orthopedic surgery. At that time plaintiff complained of recurrent back pains in the lower back, pain in the left leg, and a feeling of coldness in the left foot. Dr. Lyons concluded that plaintiff was disabled from doing heavy manual labor but not totally disabled from doing any work. He testified that it was his opinion that plaintiff could perform a job if it did not involve heavy lifting.

In addition to Dr. Lyons’ testimony the medical proofs also include depositions of Adam Brish, M.D. and Maurice E. Meier, M.D. on behalf of plaintiff. Dr. Brish was the operating neurosurgeon and his testimony only dates to his final examination of October 19, 1970. At that time he found the neurological examination of plaintiff negative.

Dr. Meier, testifying on behalf of the plaintiff, essentially found him totally and permanently disabled but conceded that "he could certainly try and see what happens.”

On July 11, 1973, Mr. Sjoquist, defendant’s plant manager, wrote plaintiff concerning possible light work. Plaintiff answered the letter promptly, appearing at defendant’s plant two days after the letter was mailed. Plaintiff was turned over to union officials and to a plant superintendent to examine the jobs. Mr. Sjoquist could not personally confirm that specific job offers had been made. Wilfred Mineau, the plant superintendent, testified at the February hearing. He stated that plaintiff was never taken around the plant to look at the jobs because he refused to go. Plaintiff stated to Mr. Mineau that there were no jobs he could do out there, and that "[t]here wasn’t any jobs he could do standing up or sitting down”. He testified that plaintiff was offered a job assembling panels on that day. In addition, plaintiff was offered a job coil winding, which would have required him to be at the job constantly. Mineau stated that he did not have the authority to provide a job which would allow plaintiff to lie down when his back bothered him and that he did not feel this would be tolerated by the company or the union: Plaintiff testified that he did not try the jobs in the plant because they required sitting or standing in one place, which he was incapable of doing.

Plaintiff raises two issues on this appeal: (1) whether the Workmen’s Compensation Appeal Board misapplied the favored work doctrine so as to place a duty on plaintiff to prove that he could not perform the favored work offered him, and (2) whether the favored work doctrine as applied is a violation of plaintiff’s due process and equal protection rights. In this Court’s opinion no reversible error has been committed here. The finding of the board is affirmed.

Chairman Gillman, for the majority of the appeal board, applied the following legal standard in the case at bar:

"As we read the law, defendant has the burden of making a good faith job offer of sufficiently favored work (Kolenko v U.S. Rubber Products, 285 Mich 159 [280 NW 148 (1938)]), which was done here. Plaintiff has the burden of attempting to perform same (Lynch v Briggs Mfg Company, 329 Mich 168 [45 NW2d 20 (1950)], Pulley v Detroit Engineering and Machine Company, 378 Mich 418 [145 NW2d 40 (1966)], et. al.).”

Where the Workmen’s Compensation Appeal Board has applied the proper legal standard, and there is competent evidence to support its finding, this Court is bound by law to accept its decision. Const 1963, art 6, §28, MCL 418.861; MSA 17.237(861), Barrett v Bohn Aluminum & Brass Co, 69 Mich App 636, 640; 245 NW2d 147, 150 (1976).

A refusal of favored work that an injured employee is capable of performing terminates that employee’s right to continued compensation benefits. Brown v Premier Manufacturing Co, 77 Mich App 573, 577; 259 NW2d 143, 145 (1977). The board’s statement that plaintiff had the "burden of attempting to perform same” is not inconsistent with the case law. Plaintiff refused to even examine the jobs offered. In light of this total refusal it cannot be said that plaintiff acted in good faith, as was found to be the fact in Kolenko v United States Rubber Products, Inc, 285 Mich 159, 162; 280 NW 148, 149 (1938). In this Court’s opinion the board’s statement that plaintiff has the burden of attempting to perform refers to this duty of good faith. Especially is this true in light of the fact that in the immediate preceding sentence the board referred to the defendant’s burden of making a good faith job offer. Since the record contains competent evidence to support the board’s factual determinations, and since this Court’s review is limited to whether or not the proper legal standards were applied, this Court finds this issue to be without merit.

As to the second issue, the record shows that plaintiff has not initiated the statutory procedure for determining his right to vocational rehabilitation benefits by petitioning the director of the Workmen’s Compensation Bureau for a hearing on the matter. MCL 418.391; MSA 17.237(391). Plaintiff contends that this statute impliedly repeals the judicially created favored work doctrine. This Court does not agree. The statute merely provides an injured employee the right to receive vocational training and rehabilitation. The favored work doctrine operates to give the employer a similar remedy for initiating a determination of the injured employee’s ability to work. The remedies offered to each party under each doctrine are distinct in nature though reaching the same issue. These remedies cannot be said to conflict.

Since no fundamental rights are involved the proper standard to be applied in determining whether a denial of equal protection has occurred is whether any reasonable relation exists between the classification and a legitimate state interest. Wahl v Brothers, 60 Mich App 66, 70; 230 NW2d 311, 313 (1975), rev’d on other grounds 394 Mich 797 (1975). Since the favored work doctrine and the vocational rehabilitation statute provide symmetrical remedies to both parties this Court finds neither a denial of equal protection nor of due process.

The order of the Workmen’s Compensation Appeal Board is affirmed.