author: R. B. Burns, J.

text:
    PEOPLE v SHARIF
    Docket No. 77-989.
    Submitted October 18, 1978, at Detroit.
    Decided November 27, 1978.
    Leave to appeal applied for.
    Ahmed M. Sharif was convicted, on his plea of guilty but mentally ill, of second-degree criminal sexual conduct, Wayne Circuit Court, Joseph G. Rashid, J. The defendant appeals alleging 1) that he should be allowed to withdraw his plea because he has not been provided with psychiatric evaluation and treatment, 2) that the statute which provides for the "guilty but mentally ill” verdict violates the title-object clause of the Michigan Constitution, and 3) that he has been deprived of equal protection of the law because prisoners who are transferred to the custody of the department of mental health do obtain a hearing for the determination of mental illness. Held:

    1. Neither the prosecutor nor the trial court made any promise to the defendant that in return for the plea psychiatric evaluation and treatment would be provided; therefore, the refusal to allow the defendant to withdraw his plea was proper.
    2. The statute which provides for the "guilty but mentally ill” verdict does not violate the title-object clause of the Michigan Constitution.
    3. The primary purpose of the hearing for determination of mental illness for prisoners being transferred to the custody of the mental health department is to determine whether treatment can best be provided by a mental health facility. Thus it is reasonable for the Legislature to provide such a hearing only for those prisoners whom corrections officials contemplate transferring.

      References for Points in Headnotes

       21 Am Jur 2d, Criminal Law §§ 485, 491, 493, 494, 503-506.
    Right to withdraw guilty plea in state criminal proceeding where court refuses to grant concessions contemplated by plea bargaining. 66 ALR3d 902.

       18 Am Jur 2d, Coram Nobis and Allied Statutory Remedies § 19. 21 Am Jur 2d, Criminal Law §§ 485-487. 39 Am Jur 2d, Habeas Corpus § 60.
    Degree of mental competence, required of accused who pleads guilty, sufficient to satisfy requirement, of Rule 11 of Federal Rules of Criminal Procedure, that guilty pleas be made voluntarily and with understanding. 31 ALR Fed 375.

      Affirmed.
    1. Criminal Law — Pleas of Guilty — Withdrawal of Pleas — Promises of Leniency — Unfulfilled Promises.
    A criminal defendant’s plea may be withdrawn and the case proceed to trial where the evidence establishes that the prosecutor or the judge has made a statement which fairly interpreted by the defendant is a promise of leniency and the assurance is unfulfilled.
    2. Constitutional Law — Criminal Law — Guilty But Mentally III —Title-Object Clause — Statutes.
    The statute which created the verdict of guilty but mentally ill does not violate the title-object clause of the Michigan Constitution (Const 1963, art 4, § 24; MCL 768.36[3]; MSA 28.1059[3]).
    3. Constitutional Law — Criminal Law — Equal Protection— Guilty But Mentally III — Mental Health Department— Hearings — Statutes.
    A defendant who has been found guilty but mentally ill has not been denied equal protection of the law by a statutory procedure whereby prisoners transferred to the custody of the department of mental health are given a hearing for the determination of mental illness because all prisoners adjudicated guilty but mentally ill are to receive evaluation and the primary purpose of the hearing is to determine whether treatment can best be provided by a mental health facility and it is, therefore, reasonable for the Legislature to provide a hearing only for those prisoners whom corrections officials contemplate transferring (MCL 330.2000, 768.36[3]; MSA 14.800[1000], 28.1059[3]).

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward F. Wilson, Principal Attorney, Appeals, and Anne B. Wetherholt, Assistant Prosecuting Attorney, for the people.

      Norris J. Thomas, Jr., Assistant State Appellate Defender, and DaWn Van Hoek, Research Attorney, for defendant on appeal.

      Before: Beasley, P.J., and R. B. Burns and J. H. VanderWal, JJ.

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

   R. B. Burns, J.

Defendant was charged with first-degree criminal sexual conduct, MCL 750.520b; MSA 28.788(2). Pursuant to a plea bargain, defendant pled guilty but mentally ill to second-degree criminal sexual conduct, MCL 750.520c; MSA 28.788(3), in exchange for the prosecutor’s promise that defendant would not be tried on the original charge. He appeals and we affirm.

Defendant alleges on appeal that he has not been provided with the evaluation and psychiat-rically indicated treatment which the department of corrections is statutorily obligated to provide. MCL 768.36(3); MSA 28.1059(3). Characterizing this statutory obligation as a promise of treatment, defendant argues by analogy to plea bargain cases, see, e.g., Santobello v New York, 404 US 257; 92 S Ct 495; 30 L Ed 2d 427 (1971), In re Valle, 364 Mich 471; 110 NW2d 673 (1961), that he is entitled to a remand to establish that the promise has been broken and that he is entitled to withdrawal of the plea.

In In re Valle, the Supreme Court held:

"If the evidence establishes that the prosecutor or the judge has made a statement which fairly interpreted by the defendant * * * is a promise of leniency, and the assurance is unfulfilled, the plea may be withdrawn and the case proceed to trial.” 364 Mich at 477-478; 110 NW2d at 677.

Our review of the plea transcript reveals that the decision to plead guilty but mentally ill, as opposed to guilty, was defendant’s, and merely acquiesced in by the prosecutor: The trial court clearly disclaimed authority to assure that the department of corrections would evaluate and treat defendant and stated that it could only recommend such treatment. Thus, there were no promises made which can bring this case within the rule established by Valle.

Defendant contends that 1975 PA 180, creating the guilty but mentally ill verdict, by amending 1927 PA 175, the code of criminal procedure, violates the title-object clause, Const 1963, art 4, § 24, because it contains provision for treatment and parole for those pleading or found guilty but mentally ill. See MCL 768.36(3); MSA 28.1059(3). The statute is presumptively constitutional, and the title must be construed reasonably, not narrowly. The statute may contain provisions which "directly relate to, carry out and implement the principal object”. Advisory Opinion re Constitutionality of 1972 PA 294, 389 Mich 441, 464-465; 208 NW2d 469, 473 (1973). Provisions for treatment and parole of those pleading or found guüty but mentally ill are germane to the principal object of creation of the plea or verdict, which is encompassed within the title provision "to provide for judgments and sentences of persons convicted of criminal offenses”. The statute does not violate the title-object clause.

Defendant argues by analogy to People v McQuillan, 392 Mich 511, 544-545; 221 NW2d 569, 584-585 (1974), that the trial court lacked jurisdiction to make the determination of whether defendant was mentally ill at the time of the offense. However, unlike in McQuillan, here the trial court had statutory authority to make the determination. MCL 768.36(2); MSA 28.1059(2). Defendant’s argument is without merit.

Defendant also argues that MCL 768.36; MSA 28.1059 violates due process by creating an irrational presumption that, if a defendant was mentally ill at the time of the offense, he will be mentally ill at the time of and throughout incarceration. It is alleged that due process requires a hearing before defendant may be incarcerated for treatment. People v McQuillan, supra. This argument is also without merit. Defendant was incarcerated because he was guilty of a crime, not because he was mentally ill. The statute does not presume defendant needs treatment because he was mentally ill at the time of the offense. Rather, the statute provides for an evaluation and such treatment as is psychiatrically indicated. We need not reach the issue of whether defendant is entitled to a hearing in addition to evaluation prior to treatment, as defendant has alleged in his first issue on appeal that he has not received treatment, and because defendant indicated when he pled guilty but mentally ill that he did so because he wanted treatment. Thus, there is no factual support for an inference that defendant has been subjected to unconsented-to treatment without due process.

Lastly, defendant argues that he has been deprived of equal protection of the law because prisoners transferred to the custody of the department of mental health do obtain a hearing for the determination of mental illness. MCL 330.2000, 768.36(3); MSA 14.800(1000), 28.1059(3). However, since all prisoners adjudicated guilty but mentally ill are to receive evaluation, the primary purpose of the hearing is to determine whether treatment can best be provided by a mental health facility. MCL 330.2000(5); MSA 14.800(1000X5). It is thus reasonable for the Legislature to provide a hearing only for those whom corrections officials contemplate transferring.

Affirmed.


source: Caselaw Access Project

author: M. F. Cavanagh, J.

license: Public Domain

text:
    WILLIAM’S DELIGHT CORPORATION v HARRIS
    Docket No. 77-997.
    Submitted January 18, 1978, at Detroit.
    Decided November 27, 1978.
    Plaintiff, William’s Delight Corporation, is a corporation organized under the laws of the Virgin Islands and is apparently qualified to do business in Michigan. Its purpose was to carry out a real estate development program of purchase of land in the Virgin Islands and the construction of condominium units. In conjunction with its incorporation plaintiff contacted 14 persons in Michigan, including defendant Fred L. Harris, for the purpose of investing. The offering brochure indicated Mr. Harris as an investor who would also act as legal adviser and Mr. Harris subsequently became secretary of the corporation. Plaintiff sued defendant to recover on an alleged agreement to purchase shares of plaintiff. Defendant denied any such agreement and asserted that, even if an agreement did exist, plaintiff might not sue upon it and, in the alternative, it was voidable for failure to comply with the Michigan Uniform Securities Act. Defendant moved to dismiss and the Oakland Circuit Court, Frederick C. Ziem, J., finding that plaintiff had failed to comply with the registration requirements of the securities law and did not meet the exemption requirements for preincorporation subscriptions, granted defendant’s motion. Plaintiff appeals. Held:

    1. The general exemption statute exempting from registration any transaction pursuant to an offer to not more than 15 persons in this state during any 12-month period does not apply to the offer of preorganization subscriptions.
    2. Where a seller can establish its own unwitting violation of the securities law and the purchaser’s culpable involvement or acquiescence in it, no public policy is thwarted by allowing a suit upon the purchase contract.
    Reversed and remanded.
    References for Points in Headnotes

       18 Am Jur 2d, Corporations §§ 46, 356, 357, 359.

       73 Am Jur 2d, Statutes § 257.

       1 Am Jur 2d, Actions §§ 53, 54.

      1. Corporations — Statutes—Securities—Registration of Securities — Subscriptions—Preincorporation Subscriptions — Exemption From Registration.
    The general exemption statute exempting from registration any transaction pursuant to an offer to not more than 15 persons in this state during any 12-month period does not apply to the offer of preorganization subscriptions (MCL 451.802[b][9]; MSA 19.776[402][b][9]).
    2. Statutes — Construction—General and Particular Provisions.
    The general provisions of a statute also containing particular provisions at variance with the general provisions will be construed as being controlled by the particular provisions and will be applied to affect only such cases as are not within the particular provisions.
    3. Corporations — Statutes—Securities—Actions—Contracts—Bar to Actions.
    The statute barring a suit based on a contract made or performed in violation of any provision of the securities law does not bar a seller from suing on a contract where the seller can establish its own unwitting violation of the law and purchaser’s culpable involvement or acquiescence in it (MCL 451.810[f]; MSA 19.776[410][f]).

      Berry, Moorman, King, Lott & Cook, P.C. (by Francis J. Newton, Jr.), for plaintiff.

      Paul G. Valentino, J.D., P.C., for defendant.
    Before: T. M. Burns, P.J., and M. F. Cavanagh and D. C. Riley, JJ.
   M. F. Cavanagh, J.

Plaintiff, William’s Delight Corporation, is a corporation organized under the laws of the Virgin Islands and apparently qualified to do business in Michigan. In 1969 it was incorporated to carry out a real estate development program for the purchase of land and the construction of condominium units in the Virgin Islands. Pursuant to this program, plaintiff contacted 14 persons in Michigan, including defendant Harris, for the purpose of investing in the corporation. From the record, it is unclear whether all 14 offers were made prior to the plaintiffs incorporation.

Plaintiffs offering brochure indicated defendant Harris as an investor who would also act as legal advisor, performing a variety of legal duties connected to the plaintiffs organization. He subsequently became secretary of the corporation as well.

The corporation has brought suit against the defendant, alleging he had failed to complete his agreement to purchase 250 shares in the amount of $25,000. Defendant moved to dismiss the complaint, denying, first, that such an agreement ever existed, and second, arguing that even if it did, plaintiff could maintain no suit on the contract and/or it was voidable by him because of plaintiffs failure to comply with the Michigan Uniform Securities Act, MCL 451.501 et seq.; MSA 19.776(101) et seq.

The court below granted the motion, finding that the plaintiff had failed either to comply with the act’s registration provision, (MCL 451.701; MSA 19.776(301)) or to meet the exemption requirements for preincorporation subscriptions under the same act (MCL 451.802(b)(10); MSA 19.776(402)(b)(10))..

On appeal, plaintiff corporation raises essentially the same arguments it raised to the trial court: (1) the transaction in question, while it does not fall within the exemption for preincorporation certificates or subscriptions, did meet the more general provisions of MCL 451.802(b)(9); MSA 19.776(402)(b)(9), and was therefore exempt from registration; (2) in any event, the defendant should be estopped from asserting the agreement’s invalidity. Plaintiff argues that as its legal advisor, defendant had the responsibility to insure the corporation’s compliance with Michigan security law, and thus cannot be heard to assert its failure to do so to avoid his obligation on the contract. The trial court did not rule on the plaintiff’s second contention, apparently finding the first dis-positive of the case. We will consider both arguments in turn.

Plaintiff first argues that if a sale of preincorpo-ration subscriptions exceeds the limits set out in MCL 451.802(b)(10); MSA 19.776(402)(b)(10), thus failing to meet the specific registration exemption for such subscriptions under that section, it may nevertheless still meet the more general terms of MCL 451.802(b)(9); MSA 19.776(402)(b)(9) and qualify for exemption from registration.

MCL 451.802(b)(10) provides:

"Any offer or sale of a preorganization certificate or subscription, and the issuance of securities pursuant thereto, if:
* * *
"(B) The number of subscribers does not exceed 10 * * * .” (Emphasis added.)

By contrast MCL 451.802(b)(9) more generally exempts from registration:

"Any transaction pursuant to an offer directed by the offeror to not more than 15 persons * * * in this state during any period of 12 consecutive months * * * .”

As used in the latter provision, "offer” includes every attempt or offer to buy or sell a security, which according to the definitional sections of the act, does encompass a preorganization subscription. MCL 451.801(j)(2); MSA 19.776(401)(j)(2). By reading these three sections together, plaintiff constructs an elaborate carry-over scheme, which in effect allows the offeror to straddle the two exemptions, thus enjoying the benefit of each.

The interpretation of these two exemption sections is one of first impression in this state and apparently also in the other jurisdictions that have adopted the Uniform Securities Act. After examining the available authority, we conclude that the trial court was correct in ruling that MCL 451.802(b)(10) alone applied to the transaction in question.

First, we disagree with plaintiff’s argument that the two sections are interrelated. While this contention has merit when applied to the Uniform Securities Act, it fails to comprehend the import of the changes made in the Michigan version of § 402(b)(10).

The uniform provision exempts the offer or sale of preincorporation subscriptions, but not the issuance of stock itself, unless another exemption is available. One such exemption is § 402(b)(9), which will exempt the issued stock, assuming that the number of original offers of subscriptions did not exceed ten. In Michigan, however, there is no need to resort to both exemptions, because MCL 451.802(b)(10), specifically exempts both the offer or sale of the subscriptions and the issuance of the securities. See Loss, Commentary on the Uniform Securities Act, pp 130-131 (1976).

It is unlikely also that the Legislature intended to allow an offeror to stack exemptions by employing a carry-over device. First, such devices enable offerors or sellers to evade the act’s registration requirements, thus undermining its investigative and protective purpose. People v Dempster, 396 Mich 700; 242 NW2d 381 (1976). Secondly, the provisions are designed to achieve two distinct results. As the Official Comments to the Uniform Securities Act indicate, MCL 451.802(b)(10); MSA 19.776(402)(b)(10), limits only the number of eventual subscribers, not offerees, thereby allowing the organizers to publicly advertise and inform a large number of investors of an investment opportunity. With this object in mind, it would be counterproductive to permit the carry-over of excess offers and subject them to the stricter terms of MCL 451.802(b)(9); MSA 19.776(402)(b)(9). It is much more logical to view the limits on offers in this provision as directed towards post-incorporation offers of securities to enable a corporation, which may not desire a major public financing campaign, to attract additional investors yet avoid the expense of registration. Securities Eule 451.802.3 supports this interpretation by indicating that § 802(b)(9) is aimed at post-incorporation offers, not merely the conclusion of transactions pursuant to offers made at any time by an issuer. Thus, the mere fact that Harris "cemented” his contractual liability after plaintiff’s incorporation is insufficient to bring the transaction within the rule especially since the offer itself was couched in terms of a preincorporation proposal.

Finally, we agree that

"Where there is in the same statute a specific provision, and also a general one which in its most comprehensive sense would include matters embraced in the former, the particular provision must control, and the general provision must be taken to affect only such cases within its general language as are not within the provisions of the particular provision.”

Evanston YMCA Camp v State Tax Comm, 369 Mich 1, 8; 118 NW2d 818 (1962), Dossin’s Food Products, Inc v State Tax Comm, 360 Mich 312; 103 NW2d 474 (1960), McKenna v Chevrolet-Saginaw Grey Iron Foundry Division, General Motors Corp, 63 Mich App 365; 234 NW2d 526 (1975), lv den, 395 Mich 827 (1976). The subscriptions at issue here clearly fell within the provisions of the narrower exemption and should be governed by it. Plaintiffs failure either to qualify for the exemption or register constituted a violation of the act.

MCL 451.810(f); MSA 19.776(410)(f) prevents a party from basing any suit upon a contract made or performed in violation of any provision of the Uniform Securities Act. However, the plaintiff urges here, as it did below, that the defendant be estopped from asserting the violation of MCL 451.701; MSA 19.776(301) as a defense to its action for damages for breach of contract, relying mainly on the authority of Schrier v B&B Oil Co, 311 Mich 118; 18 NW2d 392 (1945).

Generally speaking, estoppel cannot be used to enforce an illegal contract or allow its rescission if the contract offends a public policy embodied in a statute. Leland v Ford, 245 Mich 599; 223 NW 218 (1929). Where contracts for sale of securities in violation of state Blue Sky laws have been made, a number of jurisdictions have followed the general rule, mainly in suits for rescission brought by purchasers of these securities. Normally, the aggrieved purchasers, even if not free of wrongdoing, have been allowed to rescind the illegal contract and recover any money paid under it.

Michigan, however, has developed a jurisprudence in such cases which recognizes that in certain circumstances, the policy embodied in the state securities’ laws is better served by a more flexible approach. One line of cases, decided under the statutory scheme replaced by the Uniform Security Act, permitted the assertion of an estop-pel argument against a purchaser seeking to rescind an agreement violative of the act, on the grounds that the parties were in pari delicto, and should be left as the court found them. This conclusion was based in part on the finding that the act’s protection of innocent purchasers did not extend to one who was aware of the violation but who had made no attempt to rescind until his investment became unprofitable. The ultimate result in these cases is thus to allow the seller, who has the duty to comply with the securities’ regulations, to retain the purchase price. Schrier v B&B Oil Co, supra, Moore v Manufacturers Sales Co, 335 Mich 606; 56 NW2d 397 (1953), DePolo v Greig, 338 Mich 703; 62 NW2d 441 (1954). Using somewhat different reasoning to reach the same result, this Court, in Walton v Semmler, 6 Mich App 596; 149 NW2d 885 (1967), simply found that a purchaser who did not attempt to repudiate his agreement until sued thereon also fell outside the scope of the act.

In the above cases, the sale of securities were admittedly in violation of Michigan security laws. Nevertheless, the court estopped the purchaser from asserting the violation by focusing on such factors as his business acumen, the nature and degree of his involvement in the seller’s management, his familiarity with securities regulations and/or the seller’s failure to comply and his opportunity for independent legal advice. Thus, the common thread uniting these cases is that the purchaser urging the violation in some sense participated in the wrongdoing.

A similar result is urged here, albeit in the context of a seller’s action to enforce a purchase agreement. Plaintiff-seller alleges that the defendant’s failure to advise the corporation in regard to compliance with Michigan security law places him in pari delicto with the plaintiff. His conduct should thus estop him from asserting the transaction’s illegality thus requiring him to honor his contractual obligation to purchase stock subscriptions. Defendant asserts that if the parties are in pari delicto, the proper result is to leave all concerned as the court finds them.

While we agree with defendant that plaintiff has partially misapprehended the in pari delicto doctrine and that, if both parties equally participated in the violation, this Court should grant relief to neither, we have no basis on the present record for reaching this result. Nor, on the other hand, are we able to ascertain whether the defendant’s conduct in this matter was so egregious as to estop him from asserting the plaintiffs violation of Michigan’s security laws. We would therefore remand for the trial court’s consideration whether or not the defendant should be estopped to urge the contract’s invalidity as a defense to the plaintiffs action and for a determination of whether the parties are in pari delicto. In making this determination, the trial court should consider those factors noted above as equally applicable to plaintiff and defendant.

Arguably, the mere showing of a technical violation of the act may be sufficient for finding a plaintiff-seller in pari delicto, thus barring him from suing on his contract under MCL 451.810(f); MSA 19.776(410)(f), even where there is great disparity in the relative degrees of culpability between the parties. We are persuaded that such a rule can, in these circumstances, be overbroad. We thus agree with the statements of the California court that:

"In some cases, * * * effective deterrence is best realized by enforcing the plaintiff’s claim rather than leaving the defendant in possession of the benefit; or the forfeiture resulting from unenforceability is disproportionately harsh considering the nature of the illegality. In each such case, how the aims of policy can best be achieved depends on the kind of illegality and the particular facts involved.”

Smith v Turner, 238 Cal App 2d 141, 152; 47 Cal Rptr 582, 589 (1965). Accord, Groves v Jones, 252 Mich 446, 450-451; 233 NW 375 (1930). Nor are we concerned that allowing a seller to avail himself of the estoppel doctrine will thwart the purpose behind the Michigan Uniform Securities Act. This act, like the Federal securities acts, is aimed at protecting the innocent purchaser. Schrier, supra, Walton, supra, A C Frost & Co v Coeur D’Alene Mines Corp, 312 US 38; 61 S Ct 414; 85 L Ed 500 (1941). Certainly, in the vast majority of cases, the purchaser will normally fall within the act’s protection and the seller will be barred from basing suit on his contract. But where the seller can establish its own unwitting violation of the act and the purchaser’s culpable involvement or acquiescence in it, no public policy is thwarted by allowing the suit. See Walton, supra, Straley v Universal Uranium & Milling Corp, 289 F2d 370 (CA 9, 1961), Royal Air Properties, Inc v Smith, 312 F2d 210 (CA 9, 1962). By so limiting our holding to such situations, the spirit and purpose of the act is maintained.

Reversed and remanded.

       Under Federal securities law, the "stacking” of exemptions is expressly prohibited, particularly where the claimed exemptions may apply to an "integrated offer” that is, ostensibly separate offerings which are in reality one financing plan, cover the same type of securities and were made at or about the same time, for the same purpose. See SEC Release No. 33-4552 (Nov. 6, 1962), 27 FR 11316, Bowers v Columbia General Corp, 336 F Supp 609 (D Del, 1971).

       This rule states:
      "Only transactions effected in compliance with this rule are exempt under section 402(b)(9) of the act ** * * . The following transactions * * * are exempt under this rule:
      "(a) Transactions pursuant to offers of its securities, regardless of type or class, by an incorporated issuer directed to an aggregate of not more than 15 persons in this state during the initial period of 12 months after incorporation, and to an aggregate of not more than 10 persons during any subsequent period of 12 consecutive months.” 1954 Michigan Administrative Code 4809 (Supp 1968).

         Loewenstein v Midwestern Investment Co, 181 Neb 547; 149 NW2d 512 (1967), Randall v California Land Buyers Syndicate, 217 Cal 594; 20 P2d 331 (1933). See generally, 3 Loss, Securities Regulation (2d ed), pp 1677-1679, n 231-237, and cases cited therein. Most of the above-cited cases discuss the applicability of estoppel and in pari delicto to contracts made in violation of various state securities laws. However, courts tend to resist finding that the purchaser’s conduct has placed him in pari delicto and prevented his recovery, emphasizing the necessity of equal culpability and the purpose behind Blue Sky regulations. One California court noted that the doctrines of estoppel/ in pari delicto applied only in extreme cases where the purchaser actually participated in fraudulent securities practices. Taormina v Antelope Mining Corp, 110 Cal App 2d 314; 242 P2d 665 (1952).

       1948 CL 451.103 et seq.


author: V. J. Brennan, J.

text:
    PEOPLE v DEVINE
    Docket No. 77-1163.
    Submitted June 6, 1978, at Grand Rapids.
    Decided November 27, 1978.
    Leave to appeal applied for.
    William L. Devine was convicted of breaking and entering with intent to commit larceny, his fourth felony conviction. Subsequently, the prosecutor filed a supplemental information charging Devine as an habitual offender. Devine pled guilty to the charge, and the Saginaw Circuit Court, Eugene Snow Huff, J., sentenced him to two separate prison terms, one for the breaking and entering, the other for the habitual offender conviction, to be served concurrently. Defendant appeals, alleging that the prosecutor should not have been allowed to file the habitual offender information after the trial on the breaking and entering and that the trial court erred in imposing separate sentences. Held:

    1. The prosecutor, even though he had knowledge of defendant’s earlier convictions, was not required to file the supplemental information prior to the trial for breaking and entering.
    2. The habitual offender statute is a sentence-enhancing statute, and does not provide for a separate substantial criminal offense. Therefore, the trial court erred by imposing separate sentences.
    Affirmed, and remanded for resentencing.
    1. Criminal Law — Habitual Offenders — Notice to Defendant— Filing Supplemental Information.
    Due process does not require that a defendant be notified of an habitual offender charge against him prior to his conviction on the last of the offenses which are the basis for the habitual offender charge; a prosecutor who has knowledge of a defendant’s prior conviction is not required to file a supplemental information prior to trial on the most recent charge.

      References for Points in Headnotes

       21 Am Jur 2d, Criminal Law § 490.
    39 Am Jur 2d, Habitual Criminals and Subsequent Offenders §§ 18-27.

       21 Am Jur 2d, Criminal Law §§ 342, 490.
    39 Am Jur 2d, Habitual Criminals and Subsequent Offenders §§ 1, 2, 29, 30.
    Chronology or procedural sequence of former convictions as affecting enhancement of penalty for subsequent offense under habitual criminal statutes. 24 ALR2d 1247.
    Form and sufficiency of allegations as to time, place, or court of prior offenses or convictions, under habitual criminal act or statute enhancing punishment for repeated offenses. 80 ALR2d 1196.

      2. Criminal Law — Statutes—Habitual Offenders — Separate Sentences.
    The habitual offender statute does not provide for a separate substantial criminal offense, but operates to enhance the punishment for the offender’s last felony conviction; therefore, a trial court erred when it imposed separate sentences on a defendant’s felony conviction and his habitual offender conviction (MCL 769.12, 769.13; MSA 28.1084, 28.1085).

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Robert L. Kaczma-rek, Prosecuting Attorney, and Peter C. Jensen and Roland J. Jersevic, Assistants Prosecuting Attorney, for the people.

      Norris J. Thomas, Jr., Assistant State Appellate Defender, for defendant on appeal.
    Before: Danhof, C.J., and V. J. Brennan and R. H. Campbell, JJ.

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

   V. J. Brennan, J.

On November 17, 1976, defendant was convicted by a jury in Saginaw County Circuit Court of breaking and entering an occupied building with intent to commit larceny therein. MCL 750.110; MSA 28.305. The defendant had been convicted of three previous felonies and on November 29, 1976, the prosecutor filed a supplemental information charging the defendant as an habitual offender. Defendant pled guilty and on January 12, 1977, was sentenced to a prison term of 5 to 15 years for breaking and entering and 7 to 15 years as an habitual offender; such sentences to run concurrently. The defendant appeals as of right.

The defendant raises three issues on appeal, two of which merit discussion here.

First, the defendant argues that it is error to allow the prosecutor to file habitual offender charges after conviction where the prosecutor has knowledge of defendant’s record before trial..

Initially, we must point out that due process does not require that a defendant be notified of an habitual offender charge prior to conviction on the last offense. Oyler v Boles, 368 US 448; 82 S Ct 501; 7 L Ed 2d 446 (1962). This Court in People v Marshall, 41 Mich App 66; 199 NW2d 521 (1972), specifically held that the prosecutor is not required to file a supplemental information prior to trial where he has knowledge of the previous conviction. The Michigan Supreme Court in People v Hendrick, 398 Mich 410; 247 NW2d 840 (1976) (with Justice Levin dissenting), cited Marshall for the aforementioned proposition and did not disapprove of the practice.

In light of the case authority set forth above we hold that the prosecutor did not err in filing the habitual offender information after conviction in the present case.

Next, the defendant argues that the trial court erred by imposing separate sentences for breaking and entering and for the habitual offender conviction. We agree.

MCL 769.13; MSA 28.1085 in pertinent part provides:

"If the accused shall plead guilty to such information [habitual offender] or if the jury shall return a verdict of guilty, the court may sentence him to the punishment prescribed in the 3 preceding sections * * *

It is clear that our habitual offender statute does not provide for a separate substantial criminal offense. Moreover, it operates to enhance the punishment for the last felony conviction. People v Shotwell, 352 Mich 42; 88 NW2d 313 (1958). Therefore, the trial court’s imposition of two sentences in the present , case was improper.

We affirm but remand with directions to vacate the sentences as imposed and to resentence the defendant for breaking and entering taking into account the penalty enhancement provision set forth in MCL 769.12; MSA 28.1084.

        See Hendrick for a detailed discussion of the current Michigan law in regard to the filing of an habitual offender information.


author: Allen, P.J.

text:
    GRAVLIN v DEPARTMENT OF STATE POLICE
    Docket No. 77-1970.
    Submitted June 5, 1978, at Lansing.
    Decided November 27, 1978.
    Leave to appeal applied for.
    Beverly Gravlin commenced an original action in the Court of Appeals against the Michigan Department of State Police, the Director of the Department of State Police, Lt. Col. John Brown, and Lt. Raymond L. Coger for mandamus to require the Department of State Police to issue the plaintiff a private detective license and for compensatory damages. The department had refused to issue the license because the plaintiff allegedly did not meet the qualifications set out in the Private Detective License Act. The plaintiff maintains that her associate degree in applied science in law enforcement from Northwestern Community College qualified her for the license since a provision of the act qualifies an applicant who "is a graduate with a degree in a field of police administration from an accredited university or college”. Held:

    1. The original action in the Court of Appeals was the appropriate procedure for the plaintiff in this case because there are no factual disputes and only questions of law are involved and the denial of the license is not a subject within the Administrative Procedures Act.
    2. The degree qualification in the act requires that the degree be from a four-year college, not a two-year college.
    Mandamus denied.
    1. Mandamus — Courts—Court of Appeals — Denial of License— Private Detective License Act — Statutes.
    An original action of mandamus in the Court of Appeals is the proper procedure for review of a denial of a license under the Private Detective License Act where (1) the facts are undisputed and only questions of law are involved, and (2) the denial is not a subject within the Administrative Procedures Act (MCL 24.201 et seq., 338.821 et seq.; MSA 3.560[101] et seq., 18.184[1] et seq.).

      References for Points in Headnotes

       52 Am Jur 2d,- Mandamus §§ 207-209, 217, 219.

       15A Am Jur 2d, Colleges and Universities § 1.

       73 Am Jur 2d, Statutes § 145 et seq.

      2. Statutes — Licenses—Private Detective License Act — Words and Phrases — "College”—Statutory Construction — Statutes.
    The term "college” in the Private Detective License Act where the act provides that, as an alternative to the required experience qualification, an applicant may be qualified for a license if “a graduate with a degree in a field of police administration from an accredited university or college”, means a four-year college and not a two-year community college (MCL 338.826; MSA 18.184[6]).
    3. Statutes — Statutory Construction — Harmonious and Consistent Enactment.
    Statutes should be construed so as to produce, if possible, a harmonious and consistent enactment.

      Dively & Walton, for plaintiff.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Gerald F. Young and Richard P. Gartner, Assistants Attorney General, for defendants.
    Amici Curiae: Denison, Porter & Bartush, for Oakland Community College.
    Maclean, Seaman, Laing & Guilford, for Lansing Community College.

      Thrun, Maatsch & Nordberg, for Michigan Community College Association.
    Before: Allen, P.J., and Cynar and D. R. Freeman, JJ. '

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

   Allen, P.J.

In this original mandamus action filed with this Court, plaintiff seeks an order requiring the Michigan Department of State Police to issue her a private detective license. The narrow question raised is whether § 6 of the Private Detective License Act, MCL 338.821 et seq.; MSA 18.184(1) et seq., requires an applicant to satisfy the statutory educational requirement with a degree from a four-year college or from a two-year college. This issue of first impression comes to us on the following facts.

In June 1973, plaintiff, then age 40, graduated with an associate degree in applied science in law enforcement from Northwestern Community College in Traverse City. Intending to become a private detective, she then filed with the Department of State Police an application for license as required by the Private Detective License Act, MCL 338.821 et seq.; MSA 18.184(1) et seq. In January, 1974, the department responded by letter stating that, as interpreted by the department, the statute required an applicant to have a four-year college degree. The department then requested an advisory opinion from the Attorney General who, on March 3, 1976, responded with OAG, 1975-1976, No 4935, p 328, interpreting the statute as requiring a degree from a four-year college. Plaintiff promptly requested a formal hearing on her application, and hearing was held April 6, 1976, at the conclusion of which the application was denied.

In May, 1977, plaintiff filed this original mandamus action for an order requiring the issuance of a license and for compensatory damages of $25,000 for defendants’ alleged arbitrary refusal to issue a license. Thereafter, this Court issued a show cause order, and directed the parties to brief, in addition to the main issue involved, the two issues noted below. In April, 1978, this Court granted leave to the Michigan Community College Association to file an amicus brief.

I. Mandamus Jurisdiction

Initially we direct our attention to the jurisdictional issues which this Court directed the parties to brief. The issues were raised and are discussed in a recent opinion of this Court in Saginaw Valley Trotting Ass'n, Inc v Michigan Racing Comm’r, 84 Mich App 564; 269 NW2d 676 (1978). In that case, plaintiffs brought an original mandamus action against the racing commissioner following his denial of a track license. As here, the parties were asked to brief the question of whether mandamus in the Court of Appeals was an appropriate remedy in view of the fact that MCL 600.4401; MSA 27A.4401 now provides for mandamus in circuit court. Our Court held that in future cases involving review of a denial by the racing commissioner, mandamus should start in the circuit court. But the decision was limited as evidenced by two quotations from that opinion.

"Plaintiffs did follow the standard procedure for mandamus as it existed up to this time. Therefore, we limit our decision in this case to complaints for mandamus filed in this Court after the date of this opinion, and will not deny plaintiffs access to the remedy they invoked on grounds that they brought their action in the wrong court. Furthermore, we limit our opinion to complaints for mandamus brought under the racing act. We do not hold .that all mandamus actions against state officers must start in circuit court but we leave this issue for future decision on a case by case basis._

In the instant case, mandamus was filed in our Court long before the decision in Saginaw Valley Trotting Ass’n. Therefore, we will not penalize plaintiff for commencing action in the wrong court even if we should conclude that this case should have been commenced in circuit court.

But the question remains, viz. — in view of Saginaw Valley Trotting Ass’n, is an original action of mandamus in the Court of Appeals the proper procedure for review of the denial of a license under the Private Detective License Act? On the facts of this case, we hold that it is. The facts are undisputed. Only a question of law is involved. In Saginaw Valley Trotting Ass’n, as we believe will be true in most instances involving denial of a license, questions of fact were raised. Where only a question or questions of law are involved in suits involving review of license denials and where such denial is not a subject within the Administrative Procedures Act, we hold that mandamus may be initiated in the Court of Appeals rather than the circuit court. To hold otherwise unnecessarily complicates the judicial process by delaying the determination of law which can be made by this Court.

II. Statutory Interpretation

The relevant section of the Private Detective License Act, MCL 338.826; MSA 18.184(6), reads as follows:

"(1) The secretary of state shall issue a license to conduct business as a private detective or private investigator if he is satisfied that the applicant is a person, or if a firm, partnership, company or corporation, the sole or principal license holder is a person who meets all of the following qualifications:
"(g) For a period of not less than 3 years:
"Has been lawfully engaged in the private detective business on his own account; or
"Has been lawfully engaged in the private detective business as an investigative employee of the holder of a certificate of authority to conduct a detective agency; or "Has been an investigator, detective, special agent or police officer of a city, county or state government or of the United States government; or
"Is a graduate with a degree in a held of police administration from an accredited university or college. ” (Emphasis supplied.)

Plaintiff had no on-the-job experience and would qualify for a license only if she met the qualifications underscored above.

Plaintiff and amicus curiae argue that community colleges have existed for 38 years, were given constitutional status in 1963, and in the public mind are considered colleges. This being so, says plaintiff, the word "college” should be given, in accordance to well established rules of statutory construction, its plain and popularly understood meaning. The Attorney General argues just the opposite, claiming that, in Michigan, universities and four-year colleges have been lumped in one category and community colleges have been treated in another category; that universities and colleges and community colleges are referred to in separate sections of the Constitution of 1963, and thus in the legislative mind a college is different from a community college; that accordingly the commonly understood meaning of the word college was a four-year college. The Attorney General also argues that the long-standing administrative construction of the Private Detective License Act, that an associate degree from a community college did not meet the statutory requirements, should be controlling. To this latter argument we attach little weight because there is nothing in the record which suggests the issue has even been raised before.

The established rule of statutory construction that language is to be given its commonly understood meaning is not helpful. As defined in Black’s Law Dictionary (4th ed), p 329, a community college is a college. Webster’s Third New International Dictionary defines the word college as including both a four-year and a vocational college. See also 14 CJS, Colleges and Universities, § 1, p 1326. Thus, plaintiff meets the literal requirements of the statute. For some purposes the word college means a junior college as well as a four-year institution — for example, for purposes of exemption from taxation, Troy Conference Academy & Green Mountain Junior College v Town of Poultney, 115 Vt 480; 66 A2d 2 (1949), and for eligibility under the provisions of a will which directed that trust funds be paid to certain persons "while in college” or in securing a "college education”, Mitchell v Whittier College, 205 Cal 744; 272 P 748 (1928). On the other hand, there is authority that "college” in common parlance refers to a four-year institution. 14 CJS, Colleges and Universities, § 1, p 1327; 15A Am Jur 2d, Colleges and Universities, § 1, p 252. One definition of "college” in Webster’s Seventh New Collegiate Dictionary (1970 ed), p 162 is: "an independent institution of higher learning offering a course of general studies leading to a bachelor’s degree”. Community colleges do not grant a bachelor’s degree. So, too, there is case law that a junior or community college has been held not to be a college — for example, for purposes of voting extra millage, McHenry v Ouachita Parish School Board, 169 La 646; 125 So 841 (1930)._

The sum and substance of all of this is that there is no one answer to the question of whether "college” includes a two-year institution. There is no plain and popular understanding that in common parlance "college” means both a two-year and a four-year institution or conversely means only a four-year institution. The answer depends upon the precise wording of the statute involved, the language of the constitution of the jurisdiction, and the circumstances under which the statute was enacted. Consequently, our decision in the instant case is limited to the Private Detective License Act and is of no precedential value for statutes requiring college training, grant-in-aid, matching funds, accreditation or otherwise.

Logic and the constitutional backdrop persuade us that in the present case the word "college” means a four-year institution. To us it appears inconsistent to require in the first part, in a single sentence, a degree from a university (obviously meaning four years) and then in the final two words of the sentence to lower the requirement to a degree from a community college (meaning two years). To us, it is more consistent and logical to conclude the Legislature intended four years. A number of Michigan’s four-year colleges acquired university status shortly before the Constitutional Convention but others continued to be designated colleges. Thus, it was common to refer to four-year schools either as universities or as colleges. We believe this is what the Legislature did when preparing the statute in question.

This interpretation is consistent with sub-section (l)(g) of § 6 when read as a whole. That subsection sets forth two alternative qualifications for licen-sure: 1) on-the-job experience for three years, or 2) education culminating in a degree in police administration. To us, it appears that the Legislature was saying that if an applicant did not have three years practical experience, four years education was an alternative. Certainly that is what the first portion of the underscored sentence requires. This being so, it is totally inconsistent to interpret the final two words of the sentence ("or college”) as requiring only two years of education. It is also inconsistent with the beginning words of subsection (l)(g) "for a period of not less than three years”. Statutes should be construed so as to produce, if possible, a harmonious and consistent enactment. People v Babcock, 343 Mich 671, 678-679; 73 NW2d 521 (1955). The construction given the statute by the Attorney General and the department is consistent and harmonious. The interpretation urged by plaintiff is strained and internally inconsistent.

In the 13 years since the enactment of the statute, community colleges have greatly expanded the number and depth of courses given in law enforcement. It may well be that today the Legislature would find a two-year degree in police administration sufficient license qualification. However, that is a matter for the Legislature rather than the courts.

Mandamus denied, no costs, a public question being involved.

       Section 6 lists the qualifications for being licensed by the Secretary of State. The licensing duties of the Secretary of State were transferred to the State Police by § 156 of the Executive Organization Act, MCL 16.256; MSA 3.29(156).

      (1) Is the complaint for mandamus in the Court of Appeals an appropriate remedy for plaintiff in view of the fact that MCL 600.4401; MSA 27A.4401 now provides for an action for mandamus against a state officer in the circuit court?
      (2) Does plaintiff have an adequate legal remedy by seeking declaratory relief under MCL 24.263; MSA 3.560(163), MCL 24.264; MSA 3.560(164) and GCR 1963, 521.5 or by seeking an appeal under MCL 600.631; MSA 27A.631?

      "5 However, it would seem that the rationale of this decision would apply to most mandamus proceedings for review of state officers’ agency decisions where a remedy for review or appeal in circuit court is available under either the specific statute under which the agency proceedings were conducted, Chapter 6 of the Administrative Procedures Act, MCL 24.301 et seq.; MSA 3.560(201) et seq., or § 631 of the Revised Judicature Act, MCL 600.631; MSA 27A.631. Where circuit court review or appeal is available under one of those sources and mandamus is sought in the Court of Appeals, this Court could properly decline to entertain the complaint on the grounds that the circuit court remedy, coupled with a complaint, motion or prayer for mandamus relief, is an available adequate remedy.” 84 Mich App at 572.

       Plaintiff does not have adequate legal remedies under the Administrative Procedure Act licensing or contested case provisions, since there is no legal requirement under the Private Detective License Act for notice and hearing. MCL 24.203(3); MSA 3.560(103X3). See Kelly

        Downs, Inc v Racing Comm, 60 Mich App 539; 231 NW2d 443 (1975), Saginaw Valley Trotting Ass’n, supra. Nor does plaintiff have an adequate legal remedy under the declaratory ruling procedure of APA § 263; plaintiff is seeking a license, not merely a ruling. Compare MCL 24.263; MSA 3.560(163) with MCL 24.291; MSA 3.560(191). Likewise, the declaratory judgment remedies of APA § 264 fail to apply because no rule of the Department of State Police existed on the educational requirement question. MCL 24.264; MSA 3.560(164). See Human Rights Party v Michigan Corrections Comm, 76 Mich App 204, 211; 256 NW2d 439, 443 (1977). Finally, unlike the situation in Saginaw Valley Trotting Ass’n, here, there is not available to plaintiff a statutory provision for review in the circuit court, of the department’s refusal to license.

       See Shaw v Macomb Community College, 389 Mich 69, 75-77; 204 NW2d 129 (1973), for the statutory history of community colleges in Michigan.

       Const 1963, art 8, § 6, refers to colleges, and art 8, § 7, refers to community and junior colleges. See also discussion by Delegate An-drus in the constitutional debates. 1 Official Record, Constitutional Convention 1961, p 1172.

       A college is "an institution of learning * * * which offers instruction in the liberal arts and humanities and in scientific branches, but not in the technical arts or those studies preparatory to admission to the professions”.


author: J. H. Gillis, P. J.

text:
    SIIRA v EMPLOYERS MUTUAL LIABILITY INSURANCE COMPANY OF WISCONSIN
    Docket No. 77-2294.
    Submitted October 3, 1978, at Escanaba.
    Decided November 27, 1978.
    Leave to appeal denied, 406 Mich 918.
    Plaintiff Melvin Siira incurred a work related injury in Montana and received a lump-sum settlement pursuant to the Montana Workmen’s Compensation Act. Then Mr. and Mrs. Siira obtained a settlement from the manufacturer of a power saw involved in the accident. Thereafter defendant, Employers Mutual Liability Insurance Company of Wisconsin, obtained a judgment against Mr. Siira for reimbursement of workmen’s compensation benefits paid pursuant to the Montana act and a writ of execution was secured to enforce the judgment. Mr. and Mrs. Siira and Andrew H. Wisti and Gordon J. Jaaskelainen d/ b/a Wisti & Jaaskelainen, a partnership, filed the instant action for actual and punitive damages for abuse of process and interference with plaintiffs’ contractual rights and for apportionment of attorney’s fees as provided for in the Michigan Worker’s Disability Compensation Act. The Houghton Circuit Court, Stephen D. Condon, J., granted accelerated judgment for defendant. Plaintiffs appeal. Held:

    1. The section of the Michigan Worker’s Disability Compensation Act providing for apportionment of attorney fees between employer and employee in the event the employer is entitled to reimbursement due to the employee’s recovery from a third-party tortfeasor applies only when the compensation was paid or payable under the Michigan act.
    2. Accelerated judgment on the abuse of process claims was improper since the claims were based on matters occurring after the entry of the judgment and a judgment can never be dispositive of a cause of action based on matters occurring subsequently.
    Summary judgment was ordered as to the claim for apportionment of attorney fees, the trial court was reversed as to the abuse of process claims and the case was remanded.

      References for Points in Headnotes

       82 Am Jur 2d, Workmen’s Compensation § 437.

       46 Am Jur 2d, Judgments § 394 et seq.

      1. Workmen’s Compensation — Statutes—Third-Party Tortfeasors —Apportionment of Attorney’s Fees — Choice of Laws.
    The section of the Michigan Worker’s Disability Compensation Act providing for apportionment of attorney fees between employer and employee in the event the employer is entitled to reimbursement due to the employee’s recovery from a third-party tortfeasor applies only when the compensation was paid or payable under the Michigan act.
    2. Action — Judgments—Res Judicata — Subsequent Events.
    A judgment is never res judicata as to claims based on matters occurring subsequent to the entry of the judgment.

      Wisti & Jaaskelainen (by Michael E. Makinen), for plaintiffs.

      Vairo, Michlin, Tomasi & Johnson (by Jeryl A. Manchester), for defendant.
    Before: J. H. Gillis, P.J., and D. E. Holbrook and R. M. Maher, JJ.
   J. H. Gillis, P. J.

Plaintiffs appeal from the trial court’s order granting accelerated judgment to defendant.

Plaintiff Melvin Siira incurred a work-related injury in Montana in August, 1969. Workmen’s compensation benefits were paid under the Montana Workmen’s Compensation Act. A lump-sum payment of $14,308.90 was ultimately made which was approved by the Montana Workmen’s Compensation Division.

Plaintiffs Melvin and Shirley Siira subsequently filed suit against the manufacturer of a power saw which had been involved in the accident. This suit was settled for $75,000, $25,000 of which went to plaintiffs Wisti and Jaaskelainen for attorney fees.

On May 19, 1975, defendant filed a complaint against Mr. Siira for reimbursement of the workmen’s compensation benefits pursuant to the Montana act. Judgment in favor of defendant was rendered in July, 1976, and a writ of execution was subsequently secured to enforce this judgment.

Plaintiffs commenced the instant suit in April, 1977, requesting (1) apportionment of attorney’s fees as is provided for in the Michigan Worker’s Disability Compensation Act, MCL 418.827; MSA 17.237(827), and (2) actual and punitive damages for abuse of process and interference with plaintiffs’ contractual rights.

Defendant brought motions for accelerated judgment and summary judgment. The former was granted on June 20, 1977. Plaintiffs appeal as of right.

I

Apportionment of Attorney Fees

In granting accelerated judgment the trial court held that the "claims of Plaintiffs are barred by the prior District Court Judgment on July 19, 1976” and plaintiffs Wisti and Jaaskelainen "have no standing and are otherwise without legal capacity to seek the relief requested in the Complaint; and the claims of Plaintiffs for an accounting and/ or equitable lien are barred by laches due to their failure to bring this action in a timely manner”.

In asking for apportionment of attorney fees plaintiffs rely upon § 827 of the Michigan Worker’s Disability Compensation Act, MCL 418.827; MSA 17.237(827). This section allows an employee who has received worker’s compensation benefits from his employer to recover from a third-party tortfea-sor. Provision is made to reimburse the employer or carrier for compensation payments, with the attorney fees in a successful third-party action to be apportioned between the employee and carrier. However, § 827 has no applicability to the instant case. The first sentence of that section begins as follows: "Where the injury for which compensation is payable under this act * * * ,” It is evident from this language that § 827 is applicable only when the compensation was paid or payable under the Michigan act. In the instant case Mr. Siira lived and worked in Montana at the time of the injury, the claim was made under the Montana act, and the lump sum settlement of that claim was approved by the appropriate Montana worker’s compensation agency.

The Montana act differs significantly from the Michigan act. While both acts allow reimbursement to the carrier, Montana does not provide for apportionment of attorney fees. On the other hand, while in Michigan the carrier is entitled to be reimbursed for all compensation payments made, in Montana the carrier is only entitled to recover 50 percent of the compensation payments.

In the instant case the original compensation was paid pursuant to the Montana act. In addition, Employers Mutual sought reimbursement in accordance with the Montana act. We therefore hold that § 827 of the Michigan act is not applicable to this case. Rather, the Montana provision on reimbursement governs the issue.

Under the Montana act, the attorney has a first lien on the proceeds from a third-party settlement in the hands of whomsoever such proceeds may come. Hardware Mutual Casualty Co v Butler, 116 Mont 73; 148 P2d 563 (1944). If there are sufficient funds after payment of this fee, the compensation carrier may recover its full statutory share of reimbursement. See Anno: Workmen’s compensation: attorney’s fee or other expenses of litigation incurred by employee in action against third party tortfeasor as charge against employer’s distributive share, 74 ALR3d 854, 929. It was conceded by plaintiffs Wisti and Jaaskelainen that they received their full fee out of the third-party settlement. They contend, however, that they have agreed to refund a portion of that fee to the Siiras due to the reimbursement to the insurance carrier. They now seek to assert a claim against Employers Mutual for the attorney fees they have refunded to Mr. Siira. Whatever may be the private agreement among the plaintiffs it is clear that under Montana law defendant has no obligation to pay any portion of the attorney fees.

There is some question as to whether an order granting accelerated judgment is an appropriate method for disposing of this claim. Summary judgment for failure to state a cause of action would seem to be a more appropriate way to deal with the matter. However, since the applicability of the Michigan act was argued in front of the trial court and the parties were directed to address this issue before this Court we believe it is appropriate, pursuant to our authority under GCR 1963, 820.1(7), to order entry of summary judgment, GCR 1963, 117.2(1), in favor of defendant on Count I. See American Fidelity Fire Ins Co v Barry, 80 Mich App 670; 264 NW2d 92 (1978).

II

Abuse of Process

Counts II, III and IV deal essentially with plaintiffs’ allegation of abuse of process. The trial court’s decision to grant accelerated judgment on these three counts on the basis of res judicata was error.

The facts alleged to constitute abuse of process involve the manner in which defendant Employers Mutual executed upon its district court judgment. In order for a judgment to constitute a bar to a claim in a subsequent action, it must be upon the merits, upon the same matter in issue, and between the same parties or their privies. Curry v Detroit, 394 Mich 327; 231 NW2d 57 (1975). It is evident that a judgment cannot be dispositive of a cause of action based upon facts which occur subsequent to the entry of that judgment, as is the situation in the case at bar.

We, therefore, conclude that the trial court’s order granting accelerated judgment on Counts II, III and IV should be reversed and the case remanded for a trial on the merits. No costs, neither party having prevailed in full.

       MCL 418.827; MSA 17.237(827) reads in full as follows:
      "(1) Where the injury for which compensation is payable under this act was caused under circumstances creating a legal liability in some person other than a natural person in the same employ or the employer to pay damages in respect thereof, the acceptance of compensation benefits or the taking of proceedings to enforce compensation payments shall not act sis an election of remedies but the injured employee or his dependents or personal representative may also proceed to enforce the liability of the third party for damages in accordance with the provisions of this section. If the injured employee or his dependents or personal representative does not commence the action within 1 year after the occurrence of the personal injury, then the employer or carrier, within the period of time for the commencement of actions prescribed by statute, may enforce the liability of such other person in the name of that person. Not less than 30 days before the commencement of action by any party under this section, the parties shall notify, by certified mail at their last known address, the bureau, the injured employee, or in the event of his death, his known dependents or personal representative or his known next of kin, his employer and the carrier. Any party in interest shall have a right to join in the action.
      "(2) Prior to the entry of judgment, either the employer or carrier or the employee or his personal representative may settle their claims as their interest shall appear and may execute releases therefor.
      "(3) Settlement and release by the employee is not a bar to action by the employer or carrier to proceed against the third party for any interest or claims it might have.
      "(4) If the injured employee or his dependents or personal representative settle their claim for injury or death or commence proceedings thereon against the third party before the payment of workmen’s compensation, such recovery or commencement of proceedings shall not act as an election of remedies and any moneys so recovered shall be applied as herein provided.
      "(5) In an action to enforce the liability of a third party, the plaintiff may recover any amount which the employee or his dependents or personal representative would be entitled to recover in an action in tort. Any recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery, shall first reimburse the employer or carrier for any amounts paid or payable under this act to date of recovery and the balance shall forthwith be paid to the employee or his dependents or personal representative and shall be treated as an advance payment by the employer on account of any future payments of compensation benefits.
      "(6) Expenses of recovery shall be the reasonable expenditures, including attorney fees, incurred in effecting recovery. Attorney fees, unless otherwise agreed upon, shall be divided among the attorneys for the plaintiff as directed by the court. Expenses of recovery shall be apportioned by the court between the parties as their interests appear at the time of the recovery.
      "(7) Compensation benefits referred to in this section shall in each instance include but not be limited to all expenses incurred under sections 315 and 345.
      "(8) The furnishing of, or failure to furnish, safety inspections or safety advisory services incident to providing workmen’s compensation insurance, or pursuant to a contract providing for safety inspections or safety advisory services between the employer and a self-insurance service organization or a union shall not subject the insurer, self-insured service organization or thé accident fund, or their agents or employees, or the union, its members or the members of its safety committee, to third party liability for damages for injury, death or loss resulting therefrom.”

       It should be noted that Montana has amended its Workmen’s Compensation Act to deal with the issue involved herein. Under the law applicable to this case the compensation carrier was not obligated to share in the costs of recovery but could only recover 50% of the benefits it had paid. Under the amended version the carrier has two options. It can either share the costs of recovery, in which case it is subrogated to the full amount of compensation payments made, or it can decline to pay a share of the costs, in which case it is subrogated to only 50% of the compensation payments made.
      Relevant portions of the old provision read as follows:

        "|T|n the event said employee, or in the case of his death, his personal representative, shall bring such action, then the employer or insurance carrier paying such compensation shall be subrogated only to the extent of either one-half (1/2) of the gross amount paid at time of bringing action and the amount eventually to be awarded to such employee as compensation under the workmen’s compensation law, or one-half (1/2) of the amount recovered and paid to such employee in settlement of, or by judgment in said action, whichever is the lesser amount.” Mont Rev Codes Ann § 92.204 (1964), repealed by § 2, Ch 493, Laws 1973.
      A new section was enacted in 1977 to read, in part, as follows:
      "(1) If an action is prosecuted as provided for in 92-204.1 and except as otherwise provided in this section, the insurer is entitled to subrogation for all compensation and benefits paid or to be paid under the Workers’ Compensation Act. The insurer’s right of subrogation is a first lien on the claim, judgment, or recovery.
      "(2)(a) If the injured employee intends .to institute the third party action, he shall give the insurer reasonable notice of his intention to institute the action.
      "(b) The injured employee may request that the insurer pay a proportionate share of the reasonable cost of the action, including attorneys’ fees.
      "(c) The insurer may elect not to participate in the cost of the action. If this election is made, the insurer waives 50% of its subrogation rights granted by this section.” Mont Rev Codes Ann § 92.204.2.
      It is evident that even if this new provision were applied to this case defendant would not be required to pay any portion of the attorney fees since it was reimbursed for only 50% of its previous compensation payments.