author: M. J. Kelly, J.

text:
    CITIZENS INSURANCE COMPANY OF AMERICA v TUNNEY
    Docket No. 78-1524.
    Submitted January 3, 1979, at Grand Rapids.
    Decided July 10, 1979.
    Raymond and Lillian Tunney owned two automobiles that were insured by plaintiff Citizens Insurance Company of America under a single policy. The policy provided uninsured motorist coverage in the amount of $20,000 per person and a maximum of $40,000 per accident. Separate premiums of $.75 were charged for this coverage for each of the automobiles. The Tunneys were involved in a head-on collision with an uninsured motorist, while driving one of the insured automobiles. As a result of that collision, Lillian Tunney died and Raymond Tunney and daughter, Patrice Tunney, were seriously injured. Plaintiff insurance company brought an action for a declaratory judgment to determine the limits of liability under the uninsured motorist coverage of the insurance policy. Plaintiff insurance company argued that liability should be limited to the stated policy limits of $20,000/$40,000, while defendant Raymond Tunney, both individually and as administrator of the estate of Lillian Tunney, and defendant Patrice Tunney argued that the separate coverage of the two automobiles should be "stacked” to provide a liability limit of double the stated policy limits, or $40,000/$80,000. The policy in question provided that when there were two or more automobiles insured under the policy "the terms of this policy shall apply separately to each”; however, the policy further provided that "neither the inclusion of more than one Assured nor the application of the policy to more than one automobile shall operate to increase the limit of liability stated in the policy”.

      References for Points in Headnotes

       7 Am Jur 2d, Automobile Insurance §§ 135-138, 189, 194.
    New Topic Service, No-Fault Insurance § 21.
    What constitutes "each,” "a single,” "one,” "any one,” "any,” or "an accident or occurrence within liability policy limiting insurer’s liability to specified amount. 55 ALR2d 1300.
    Validity and construction of "other insurance” provisions. 28 ALR3d 551. Automobile liability policy: choice of law as to validity of "other insurance” clause of uninsured motorist coverage. 83 ALR3d 321.

       Limitation of amount of coverage under automobile liability policy as affected by fact that policy covers more than one vehicle. 37 ALR3d 1263.

      The Wexford Circuit Court, Walter F. Ransom, J., held that the liability limit of defendant insurance company was that stated in the policy, or $20,000 per person and $40,000 maximum per accident. Defendants appeal. Held:

    1. The public policy of the State of Michigan is no longer served by invariably allowing "stacking” of uninsured motorist coverage. In the absence of ambiguities, an insured party’s recovery under the uninsured motorist coverage of an insurance policy which covers two automobiles and contains an "other insurance” clause can be limited to the maximum amount permitted by the "other insurance” clause.
    2. No ambiguity as to whether there can be "stacking” of uninsured motorist coverage is created by an insurance policy covering two automobiles, where the policy provides that the terms of the policy shall apply separately to each of the automobiles, but that the inclusion of coverage of more than one automobile in the policy shall not operate to increase the stated policy limits of liability. The language that the terms of the policy shall apply separately to each insured automobile simply makes the policy applicable to whichever automobile is involved in an accident.
    3. The payment of two separate premiums of equal amounts for uninsured motorist coverage on two different automobiles covered by a single insurance policy is not persuasive of an expectation of stacking the limits of liability, in the absence of proofs of double payment which would warrant double recovery.
    Affirmed.
    1. Insurance — Automobiles — Uninsured Motorist Coverage — Other Insurance Clause — Stacking — Public Policy.
    The public policy of the State of Michigan is no longer served by invariably allowing "stacking” of uninsured motorist coverage; therefore, in the absence of ambiguities, an insured party’s recovery under the uninsured motorist coverage of an insurance policy or policies which contain an "other insurance” clause limiting the maximum liability can be limited to the maximum amount permitted by the "other insurance” clause.
    2. Insurance — Automobiles — Uninsured Motorist Coverage — Stacking — Ambiguities.
    No ambiguity as to whether there can be stacking of uninsured motorist coverage is created by an insurance policy covering two automobiles, where the policy provides that the terms of the policy shall apply separately to each of the automobiles but that the inclusion of more than one automobile on the policy shall not operate to increase the stated policy limits of liability.
    3. Insurance — Automobiles — Uninsured Motorist Coverage — Stacking — Premiums.
    The payment of two separate premiums of equal amounts for uninsured motorist coverage on two different automobiles covered by a single insurance policy is not persuasive of an expectation of stacking the limits of liability in the absence of proof of double payment which would warrant double recovery.

      Menmuir, Zimmerman, Rollert & Kuhn, for plaintiff.

      Robb, Dettmer & Phillips, P.C., for defendant.
    Before: D. E. Holbrook, Jr., P.J., and R. B. Burns and M. J. Kelly, JJ.
   M. J. Kelly, J.

Defendants appeal from an April 6, 1978, declaratory judgment for plaintiff-insurer holding the limits of liability under the uninsured motorist provisions of the policy between the parties to be $20,000 for one person and $40,000 for two or more persons in any one accident, as stated on the face of the policy.

On July 27, 1975, defendants were hit head-on by a negligent uninsured motorist. Lillian Tunney was fatally injured, Raymond Tunney sustained severe personal injuries, and his daughter, Patrice Tunney, was also seriously injured.

At the time of the collision, Raymond and Lillian Tunney owned two automobiles, both insured by plaintiff under one policy that named Raymond and Lillian Tunney as the insureds. They were driving one of these automobiles at the time of the accident. The Tunneys paid separate premiums of $.75 for uninsured motorist coverage of $20,000 per person, $40,000 maximum per accident for each automobile. Defendants contend that, as the policy covers two automobiles for which separate uninsured motorist coverage premiums were paid, they are entitled to double the limits of the policy and should recover $40,000 per person, to a maximum of $80,000 per accident.

The introductory language found on page 1, and preceding all other sections of the policy states:

"CITIZENS MUTUAL INSURANCE COMPANY of Howell, Michigan (Herein called the Company)
"In consideration of the payment of the premium, in reliance upon the statements in the Declarations made a part hereof, and subject to the limits of liability, the exclusions, the conditions and other terms of this policy, does hereby agree with the named Assured:”

Page 12, paragraph 7, of the policy contains the following language:

"7. Insurance on Two or More Automobiles.
"When two or more automobiles are insured hereunder, the terms of this policy shall apply separately to each, but an automobile and an attached trailer shall be deemed to be one automobile as respects the limits of liability under Section Two and separate automobiles under Section One, including any deductible provisions applicable thereto.
"Neither the inclusion herein of more than one Assured nor the application of the policy to more than one automobile shall operate to increase the limit of liability stated in the policy (or in the Declarations) for any coverage.”

Before the enactment of the Michigan no-fault act, MCL 500.3101 et seq.; MSA 24.13101 et seq., and the repeal of the uninsured motorist statute, formerly MCL 500.3010; MSA 24.13010, Michigan law allowed "stacking” of uninsured motorist coverage provided by separate policies despite language in the policies limiting recovery in cases where "other insurance” was available. Blakeslee v Farm Bureau Mutual Ins Co, 388 Mich 464; 201 NW2d 786 (1972), Rowland v Detroit Automobile Inter-Insurance Exchange, 388 Mich 476; 201 NW2d 792 (1972), Boettner v State Farm Mutual Ins Co, 388 Mich 482; 201 NW2d 795 (1972). The rationale underlying these holdings was that, since the uninsured motorist statute required insurance companies to offer their customers uninsured motorist coverage, it was against the public policy of the state to allow an "other insurance” clause to defeat "stacked” recovery. These requirements, however, no longer exist; accordingly, the public policy of the state is no longer served by invariably allowing a stacked recovery. Insurance contracts are, therefore, to be interpreted according to well-known rules of construction.

This Court held in Kozak v Detroit Automobile Inter-Insurance Exchange, 79 Mich App 777; 262 NW2d 904 (1977), that an insurer’s liability under a policy containing an "other insurance” clause is limited to the amount stated on the face of the policy. When an insurer issues multiple insurance policies, each providing uninsured motorist coverage and containing an "other insurance” clause, the insured party can recover only the maximum amount that he is limited to by the "other insurance” clause. In the absence of ambiguities, the rights of the parties rest on the insurance contract as written.

Defendants contend that the above quoted language from page 12, paragraph 7, of the policy creates an ambiguity in that it first states that the terms of the policy shall apply separately to each automobile insured under the policy, arguably setting up a stacking situation, and then adds that the inclusion of more than one automobile in the policy shall not operate to increase the stated limits of liability. If an ambiguity does exist, the policy must be liberally construed in favor of the insured and against the insurer who drafted the policy. Dittus v Geyman, 68 Mich App 433; 242 NW2d 800 (1976), Weaver v Michigan Mutual Liability Co, 32 Mich App 605; 189 NW2d 116 (1971).

We do not find that the cited language creates an ambiguity. It has often been noted in cases from other jurisdictions that language stating that the terms of a policy shall apply separately to each insured vehicle simply makes the policy applicable to whichever automobile is involved in an accident. Allstate Ins Co v Mole, 414 F2d 204 (CA 5, 1969), Yates v Interinsurance Exchange of Automobile Club of Southern California, 275 Cal App 2d 301; 79 Cal Rptr 604 (1969), Otto v Allstate Ins Co, 2 Ill App 3d 58; 275 NE2d 766 (1971), Pacific Indemnity Co v Thompson, 56 Wash 2d 715; 355 P2d 12 (1960). See also 37 ALR3d 1263. When the stated limits of liability are exact and when the policy clearly indicates that the inclusion of more than one automobile does not affect those limits, the language does not appear to us to create an ambiguity.

Finally, defendant (at oral argument) averred that, because two separate premiums for uninsured motorist coverage were paid, a situation was created where he expected to receive double recovery. This argument proceeds on the premise that, if the premium for uninsured motorist coverage on the second car is less than that for the first, it represents consideration only for the insurer’s increased risk of exposure, and, as such, there has been no double payment warranting double recovery. From this premise, it follows that, if the premium for the second car is equal to that of the first, as in the instant case, the insured has paid twice for uninsured motorist coverage, and a double recovery is justified.

Although this type of argument has proven persuasive in other jurisdictions, Sturdy v Allied Mutual Ins Co, 203 Kan 783; 457 P2d 34 (1969), Rosson v Allied Mutual Ins Co, 203 Kan 795; 457 P2d 42 (1969), we do not find the fact that defendants’ separate premiums are stated in equal amounts to be determinative. Neither are we prepared to decide the question solely on defendant’s claimed expectation. Here, the lower court decided this issue on the language of the contract. There have been no proofs offering or establishing the underwriting predicate for the second premium. In the absence of proof of double payment warranting double recovery, we will not override the unambiguous contract language limiting the insurer’s liability and permit "stacking”.

Our decision to affirm the trial court, however, should not be construed as a complete bar to the stacking of insurance coverage. We hold only that, in the absence of proof of double payment warranting double coverage, we will not ignore the clear impact of this insurance contract "separability” clause, and leave to future cases, with adequate records, the question of double recovery under the no-fault act.

The trial court was correct in holding the limits of liability to be the amounts stated in the policy.

Affirmed.

       Some cases have held that similar language does create an ambiguity. See, e.g., Government Employees Ins Co v Sweet, 186 So 2d 95 (Fla App, 1966). These cases usually involve special forms of insurance, such as medical payment insurance, and they are distinguishable on this ground. See Allstate Ins Co v Mole, supra, Otto v Allstate Ins Co, supra.

       See, Ringenberger v General Accident Fire & Life Assurance Co, 214 So 2d 376 (Fla App, 1968), Otto v Allstate Ins Co, supra.


source: Caselaw Access Project

author: R. B. Burns, P.J.

license: Public Domain

text:
    WARREN v MICHIGAN GAS UTILITIES COMPANY
    Docket No. 78-1675.
    Submitted June 6, 1979, at Grand Rapids.
    Decided July 10, 1979.
    Leave to appeal denied, 407 Mich 899.
    J. B. Warren was injured in a gas explosion while working in a sewer. He was at the time employed by Woodruff & Sons, a contractor on the sewer construction project. Michigan Gas Utilities Company had employees on the construction site to assist in locating gas lines and to supervise construction around the gas lines. The causes of the explosion were disputed. J. B. Warren and El vie R. Warren brought an action for damages against Michigan Gas Utilities Company. The Berrien Circuit Court, Zoe S. Burkholz, J., following a jury verdict, entered judgment of no cause of action in favor of the defendant. Plaintiffs appeal. Held:

    1. The trial court properly admitted evidence of Woodruff & Sons’ negligent failure to test for gas and held that such evidence would create a fact issue for the jury on superseding intervening cause.
    2. The evidence of Woodruff & Sons’ negligence was also relevant when admitted for the purpose advanced by the defendant: to show that the negligence of Woodruff & Sons and of J. B. Warren was the sole proximate cause of the explosion.
    3. The standard jury instructions given adequately set forth the law applicable to the factual issues actually raised by the parties.
    4. The trial court properly instructed the jury on two construction industry safety rules requiring gas detectors and tests in tunnels.
    5. The trial court properly allowed the defendant to amend its answer at the conclusion of proofs to allege contributory wilful and wanton misconduct by J. B. Warren. In addition, sufficient evidence of such conduct was presented to raise a jury question on this issue.
    6. An exhibit was properly admitted into evidence where the plaintiffs failed to object to the exhibit on the basis of a lack of foundation prior to trial, as required by a pretrial order.

      References for Points in Headnotes

       57 Am Jur 2d, Negligence §§ 198, 205.

       57 Am Jur 2d, Negligence § 141.

       57 Am Jur 2d, Negligence § 8.

      Affirmed.
    1. Negligence — Third Parties — Superseding Cause.
    The mere fact that evidence of a third party’s passive negligence does not establish a superseding cause as a matter of law does not mean that such evidence cannot establish a superseding cause as a matter of fact; where reasonable men could disagree as to foreseeability of the intervening negligence the issue is one for the jury.
    2. Negligence — Evidence — Third Parties — Proximate Cause.
    Evidence of the negligence of a third party was relevant and properly admitted where it was offered by the defendant for the purpose of showing that the third party’s negligence was the sole proximate cause of an accident.
    3. Negligence — Instructions to Jury — Tunnels — Sewers — Rules. ,
    A trial court properly instructed a jury regarding construction industry safety rules requiring gas detectors and inspections in tunnels in a case involving a gas explosion in a sewer; a "tunnel” would encompass a sewer, and the construction industry safety code contains no restrictive definition of a tunnel while the code does contain several rules which deal specifically with sewers (1964-1965 AACS R 408.1201 et seq.).

      Sloan, Zarbock, Risdon, Beneñel & Farmer, for plaintiffs.

      Rhoades, McKee & Boer (by Michael J. Roberts and Ben T. Liu), for defendant.
    Before: R. B. Burns, P.J., and D. E. Holbrook, Jr. and B. D. Burdick, JJ.

       Former circuit judge, sitting on the Court of Appeals by assignment pursuant to Const Í963, art 6, § 23 as amended in 1968.

   R. B. Burns, P.J.

In this action plaintiffs J. B. Warren and Elvie R. Warren alleged defendant Michigan Gas Utilities Company caused them injury through negligent or wilful and wanton misconduct. A jury returned a verdict of no cause of action in favor of defendant. Plaintiffs appeal, and we affirm.

Plaintiff J. B. Warren was an employee of Woodruff & Sons Construction Company. In 1973, Woodruff & Sons was a contractor on a sewer construction project in the City of Benton Harbor. Defendant had employees on the construction site to assist Woodruff & Sons in locating its gas lines and to supervise construction around the gas lines. On December 14, 1973, Woodruff & Sons unearthed leaking gas pipes. Defendant’s employees made some repairs, and Woodruff & Sons backfilled the area. On December 18, 1973, J. B. Warren and a co-worker, Ollie Venters, entered a manhole to do work in the sewer. After three minutes Venters yelled "I smell gas”, and an explosion occurred a moment later.

The causes of the explosion were disputed. One of the unearthed pipes was subsequently found to be cracked. Plaintiffs argued that the leaks had been inadequately repaired, and that defendant’s employees did not adequately supervise Woodruff & Sons’ backfilling around the pipes. Defendant responded that the pipes were adequately repaired, and that Woodruff & Sons improperly backfilled, cracking the pipe, after defendant’s employees had left the area. Defendant also asserted that Woodruff & Sons should have tested for gas before sending J. B. Warren into the manhole, and that J. B. Warren triggered the explosion by attempting to light a cigarette.

Plaintiffs made a motion in limine to exclude proof of Woodruff & Sons’ negligent failure to test for gas, arguing on the authority of Parks v Starks, 342 Mich 443; 70 NW2d 805 (1955), that such evidence would not, as a matter of law, establish superseding intervening negligence. Defendant responded that such evidence was admissible to prove that the sole proximate cause of the explosion was Woodruff & Sons’ negligence, irrespective of any probative value the evidence might have as an intervening cause. The trial court initially granted plaintiffs’ motion, but subsequently reversed itself, holding that Woodruff & Sons’ negligent failure to test for gas would create a fact issue for the jury on superseding intervening cause.

Relying again upon Parks, plaintiffs argue on appeal that the trial court erred by admitting evidence of Woodruff & Sons’ passive negligence, for such passive negligence, they allege, cannot, as a matter of law, be a superseding intervening cause. Parks, however, not only does not support plaintiffs’ argument, but suggests a conclusion that the evidence raised a fact issue on superseding cause, and therefore was relevant.

In Parks, a defendant Grant argued that the negligent failure of other defendants to erect barriers around a hazard negligently created by Grant amounted to superseding intervening cause as a matter of law. Grant had run his automobile into the pillar of a service station canopy, which later collapsed on the plaintiff. The Court held that such intervening passive negligence was not a superseding cause as a matter of law where the other defendants had not assumed a duty which they failed to perform, or had not undertaken to do some act and performed it improperly. The Court also held that the record presented a fact question as to whether the danger was foreseeable and whether plaintiffs injuries were the natural and probable consequences of Grant’s negligence.

Assuming that the evidence of intervening passive negligence in the instant case did not, under Parks, establish superseding cause as a matter of law, it does not follow, as plaintiffs suggest, that such evidence did not, therefore, raise a fact issue concerning superseding cause. On the contrary, the Court in Parks concluded that there was a fact issue on proximate causation in that case. The mere fact that evidence of intervening passive negligence does not establish superseding cause as a matter of law does not mean that such evidence cannot establish superseding cause as a matter of fact. Where reasonable men could disagree as to foreseeability of the intervening negligence the issue is one for the jury. Moning v Alfono, 400 Mich 425, 458; 254 NW2d 759, 774 (1977), Davis v Thornton, 384 Mich 138; 180 NW2d 11 (1970). In the instant case, as in Parks, the evidence created a fact issue for the jury, and was, therefore, admissible under the rationale advanced by the trial court.

The issue was and is, however, a red herring. Defendant has never argued that Woodruff & Sons’ negligent failure to test for gas was a superseding intervening cause. Rather, defendant denied that it was negligent, and sought to establish that the sole proximate causes of the explosion were the negligence of J. B. Warren and Woodruff & Sons. The evidence was relevant when admitted for the purpose advanced by defendant.

For the same reason, plaintiffs’ argument that the jury instructions on superseding intervening cause were not sufficiently explicit to prevent jury speculation, see McKine v Sydor, 387 Mich 82, 89; 194 NW2d 841, 845 (1972), are without merit. The standard jury instructions given by the trial court adequately set forth the law applicable to the factual issues actually raised by the parties. SJI 15.01, 15.02, 15.03, 15.05. Superseding intervening cause was not an issue. Plaintiffs’ explicit instruction on superseding negligence would only have drawn the jury’s attention to another route of reasoning by which it might find defendant not liable, to plaintiffs’ detriment. There was no error.

Plaintiffs also objected to the trial court’s instructions on two construction industry safety rules requiring gas detectors and tests in tunnels. MCL 408.717; MSA 17.469(7), repealed, 1974 PA 154, 1964-1965 AACS R 408.2402, R 408.2410. It is plaintiffs’ theory that the rules are inapplicable to the determination of Woodruff & Sons’ negligence because a sewer is not a tunnel. However, tunnel, in everyday parlance, would encompass the sewer, and the construction industry safety code contains no restrictive definition of tunnel. 1964-1965 AACS R 408.1201, et seq. The rules upon which the trial court instructed are contained in part 14 of the code, entitled "Tunnels”. Several rules under part 14 deal specifically with sewers. 1964-1965 AACS R 408.2407, R 408.2408. It thus appears that sewers are types of tunnels, and the trial court properly instructed the jury.

At the conclusion of proofs the trial court granted defendant’s motion to amend its answer to allege contributory wilful and wanton misconduct on the part of plaintiff J. B. Warren. GCR 1963, 118.3. Plaintiffs argue in a conclusory manner that the late amendment prejudiced them because they were unable to address the issue through trial preparation, strategy and evidentiary content. However, it appears that the same evidence relied upon by both parties regarding the presence or absence of contributory negligence by J. B. Warren was the evidence relied upon by the parties regarding wilful and wanton misconduct. Aside from conclusory allegations of prejudice, plaintiffs have demonstrated no actual way in which trial preparation, strategy, and presentation of evidence was affected. There was no error.

Plaintiffs also argue that there was not sufficient evidence to raise a jury issue on contributory wilful and wanton misconduct. We disagree. A jury could infer from the evidence presented that plaintiff was aware of the danger of smoking where gas is present, knew gas might be present, but recklessly attempted to light a cigarette anyway. See, e.g., Gibbard v Cursan, 225 Mich 311, 318-324; 196 NW 398, 400-402 (1923), Thone v Nicholson, 84 Mich App 538; 269 NW2d 665 (1978).

Plaintiffs argue that an exhibit offered by defendant consisting of 11 pages of specifications on excavating and backfilling contained in a contract between the City of Benton Harbor and Woodruff & Sons should not have been admitted because it violated the spirit of a pretrial order to exchange exhibits where defendant provided plaintiffs with the specifications, but not the rest of the contract. Plaintiffs’ argument in essence is that no foundation for admission of the exhibit as having been a part of the contract was established. However, plaintiffs failed to object to the exhibit on the basis of lack of foundation prior to trial as required by the pretrial order. The exhibit was admissible.

Affirmed. Costs to defendant.

       An issue never raised by defendant, and the resolution of which is unnecessary in this appeal.


author: Cynar, P.J.

text:
    PEOPLE v POYMA (CITY OF SOUTH LYON v POYMA)
    Docket No. 78-1785.
    Submitted March 12, 1979, at Lansing.
    Decided July 10, 1979.
    Anthony J. Poyma was convicted of driving under the influence of intoxicating liquor in violation of the City of South Lyon’s ordinance no. 94. The ordinance adopts by reference the entire Uniform Traffic Code. The adopting ordinance was never published in any newspaper. Instead, a notice was published in the South Lyon Herald indicating adoption of the code by reference. Both prior to trial and subsequent thereto defendant alleged that the ordinance was invalid and moved to dismiss. Oakland District Court, Martin L. Boyle, J., denied these motions and ordered defendant to pay a $100 fine, $150 in costs, and a $5 statutory judgment fee. Defendant appealed to Oakland Circuit Court. The circuit court, Alice L. Gilbert, J., issued an order vacating defendant’s district court conviction for violating the South Lyon ordinance. The basis for this order was that the ordinance, which adopted the traffic code under which he was convicted, was void for lack of publication. The people appeal. The question presented is whether South Lyon’s failure to publish adopting ordinance no. 94 rendered the ordinance invalid. Held:

    Both the charter and the adopting ordinance clearly indicate that the publication of the adopting ordinance is a prerequisite to the legal effectiveness of the code being adopted. The adoption by reference statute contemplates full publication of an adopting ordinance. By failing to publish the adopting ordinance South Lyon violated the publication requirements of the ordinance itself, the city charter and the adoption statute. The ordinance under which defendant had been convicted was invalid for lack of publication of the adopting ordinance. Vacation of defendant’s conviction under the ordinance and dismissal of charges was proper.
    Affirmed.
    Reference for Points in Headnotes

       56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions § 350.

      1. Municipal Corporations — Ordinances — Publication — Statutes.
    Generally, all city, township or village ordinances must be published in a local newspaper within one week of their adoption (MCL 89.6; MSA 5.1722).
    2. Municipal Corporations — Ordinances — Publication — Public Access — Definitions.
    Publication of city, township or village ordinances means printing or otherwise reproducing copies of them and distributing them in such a manner as to make their contents easily accessible to the public.
    3. Municipal Corporations — Ordinances — Uniform Traffic Code — Adoption by Reference — Publication — Statutes.
    A statute authorizes cities to adopt the Uniform Traffic Code by reference; such code need not be published in full, but the law requires that publication of the code or ordinance shall be supplemented by a notice of the purpose of such code and of the fact that complete copies of the code are available at the office of the city clerk for inspection by and distribution to the public at all times (MCL 257.951, 257.952; MSA 9.2651, 9.2652).
    4. Municipal Corporations — Ordinances — Uniform Traffic Code — Adoption by Reference — Publication — City Charters — Statutes.
    A city ordinance attempting to adopt the Uniform Traffic Code by reference is invalid where the city failed to publish the adopting ordinance in violation of the requirements of the ordinance, the city charter and the adoption by reference statute and where both the charter and the adopting ordinance clearly indicate that the publication of the adopting ordinance is a prerequisite to the legal effectiveness of the code being adopted (MCL 257.952; MSA 9.2652).
    5. Municipal Corporations — Ordinances — Uniform Traffic Code — Adoption by Reference — Publication — Substantial Compliance.
    The publication requirements of a city ordinance, city charter and adoption statute, which require publication of a code-adopting ordinance, must be strictly complied with where a city intends to adopt the Uniform Traffic Code by reference; full publication of the adopting ordinance is necessary to properly inform the public of new traffic regulations; anything less, such as substantial compliance with ordinance publication requirements, is insufficient.

      Cooper, Shifman & Gabe (by Philip H. Seymour), for plaintiff.

      John H. Burke, for defendant.
    Before: Cynar, P.J., and J. H. Gillis, and N. A. Baguley, JJ.

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

   Cynar, P.J.

Plaintiff appeals by leave granted from a November 29, 1977, circuit court order vacating defendant’s district court conviction for violating a City of South Lyon ordinance. The basis for this order was that the ordinance, which adopted the traffic ordinance under which he was convicted, was void for lack of publication.

On January 3, 1977, defendant was convicted of driving under the influence of intoxicating liquor, a violation of City of South Lyon’s Ordinance No. 94, ch 5, § 5.15. Both prior to trial and subsequent thereto defendant alleged that the ordinance was invalid and moved to dismiss. These motions were denied and defendant was ordered to pay a $100 fine, $150 in costs, and a $5 statutory judgment fee. Defendant appealed to circuit court and obtained the order which plaintiff challenges at this time.

The ordinance in question, which was passed by the City of South Lyon City Council on February 2, 1959, contains very little substance. Instead, it adopts, by reference, the entire Uniform Traffic Code, without setting forth all the ordinances contained in that code.

The adopting ordinance was never published in full in any newspaper. Instead, a notice was published in the February 5, 1959, edition of the South Lyon Herald, indicating that the Uniform Traffic Code had been adopted by reference by the city council on February 2, 1959. This notice stated the code’s purpose, noted that complete copies of the code were available at the city clerk’s office, and stated that "no further or additional publications of the Uniform Traffic Code is required or contemplated”.

The Legislature has provided, as a general rule, that all ordinances must be published in a local newspaper within one week of their adoption. MCL 89.6; MSA 5.1722. As applied to statutes and ordinances, "publication” means "printing or otherwise reproducing copies of them and distributing them in such a manner as to make their contents easily accessible to the public”. Black’s Law Dictionary (4th ed), p 1396.

However, the Legislature has provided a specific means of adopting and publishing the code involved here. MCL 257.951; MSA 9.2651 authorizes cities to adopt the Uniform Traffic Code by reference, stating:

"Any city, township or village is hereby authorized to adopt by reference any code or ordinance for the regulation of traffic within cities, townships and villages which has been promulgated by the commissioner of the state police. The commissioner of the state police is hereby authorized to promulgate a uniform traffic code subject to the provisions of Act No. 88 of the Public Acts of 1943, as amended, being sections 24.71 to 24.82, inclusive, of the Complied Laws of 1948.”

MCL 257.952; MSA 9.2652 provides the specific means of publishing the adoption ordinance. It reads:

"The code or ordinance, so passed, shall clearly identify the code so adopted by reference. Such code need not be published in full: Provided, however, That publication of the code or ordinance shall be supplemented by a notice of the purpose of such code and of the fact that complete copies of the code are available at the office of the city, township or village clerk for inspection by and distribution to the public at all times.”

Although the second sentence of MCL 257.952; MSA 9.2652 provides an exception to the general rule of publication insofar as the code being adopted is concerned, the third sentence clearly contemplates full publication of the adopting ordinance.

Plaintiff correctly concedes that the publication requirement of MCL 257.952; MSA 9.2652 was not complied with in this case. However, it contends that the failure to comply with state law does not render the ordinance ineffective. In this regard, plaintiff cites Vernakes v South Haven, 186 Mich 595; 152 NW 919 (1915), where the Court held that the failure of a city to publish an ordinance does not render it ineffective, in the absence of a city charter so specifying.

In the present case, however, the city charter of the City of South Lyon also requires publication of the adopting ordinance. Section 4.12 of the charter reads:

"Section 4.12. The Council may adopt in whole or in part any provision of state law or any detailed technical regulations as a city ordinance or code by citation of such provision of state law or by reference to any recognized standard code, official or unofficial, provided that any such provision of state law or standard code shall be clearly identified in the ordinance adopting the same as an ordinance of the city. Where any code or amendment thereto is so adopted, all requirements for its publication may be met, other provisions of this Charter notwithstanding, by publishing the ordinance citing such code and by keeping copies of the code itself available to the public in book or booklet form at a reasonable charge. ” (Emphasis added.)

Further, § 4.9 of the city charter provides that the effective date of an ordinance "shall not be less than ten days after its adoption nor before publication thereof’. (Emphasis added.) This language is substantially repeated in the adopting ordinance itself, which requires the city clerk to "publish this ordinance in the manner required by law” and which states that "The Uniform Traffic Code will be in effect in this governmental unit ten (10) days after publication of this adopting ordinance”.

Therefore, it is clear that plaintiff’s failure to publish the adopting ordinance violated the requirements of the ordinance and city charter, as well as the requirements of MCL 257.952; MSA 9.2652. Both the charter and the adopting ordinance clearly indicate that the publication of the adopting ordinance is a prerequisite to the legal effectiveness of the code being adopted. Under these circumstances, plaintiff cannot rely upon the holding in Vernakes, supra.

Plaintiff next urges us to adopt a "substantial compliance” standard in evaluating the charter and ordinance publication requirements. It argues that the notice that was published provided the same notice of the enactment of the code as would have the publication of the adopting ordinance.

We disagree. Although the adopting ordinance does not contain all the provisions of the Uniform Traffic Code, it does contain information that was not conveyed by virtue of the notice publication. Most prominent is the absence of reference to the effective date of the ordinance, which is required by § 4.9 of the city charter to be included in the ordinance. This valuable piece of information was conveyed nowhere in the notice sent to the newspaper for publication.

Nor does the case law of this state support a "substantial compliance” standard for publication. To the contrary, the prior opinions in this area tend to adhere to a policy of strict compliance with publication requirements. See L A Thompson Scenic R Co v McCabe, 211 Mich 133; 178 NW 662 (1920), Village of Durand v Love, 254 Mich 538; 236 NW 855 (1931), and Stevens v Madison Heights, 358 Mich 90; 99 NW2d 564 (1959). See also 5 McQuillian, Municipal Corporations (3d ed), § 16.78, pp 300-301, and 62 CJS, Municipal Corporations, § 427a, pp 816-817. Plaintiff has unambiguously required publication prior to the effective date of the ordinance and cannot now complain of a requirement the existence of which is totally its own responsibility.

Therefore, we conclude that the circuit court judge properly concluded that the ordinance under which defendant had been convicted was invalid for lack of publication of the adopting ordinance. In light of this conclusion, we hold the circuit judge properly vacated defendant’s conviction under the ordinance and properly ordered the charge dismissed.

Affirmed.

       Ordinance No. 94, the ordinance in question, reads in full as follows:
      "An ordinance to adopt by reference the Uniform Traffic Code for Michigan Cities, Townships and Villages.
      "The City of South Lyon ordains:
      "Sec. 1. CODE ADOPTED
      "The Uniform Traffic Code for cities, townships and villages promulgated by the Commissioner of State Police on February 14, 1958, and published in Supplement No. 13, Michigan Administrative Code, pages 5 to 37, in accordance with Public Act 62 of 1956, State of Michigan, is hereby adopted by reference as in this ordinance modified.
      "Sec. 2. REFERENCES IN CODE
      "References in the Uniform Traffic Code for Michigan Cities, Townships and Villages to 'governmental unit’ shall mean the City of South Lyon.
      "Sec. 3. NOTICE TO BE PUBLISHED
      "The City Clerk shall publish this ordinance in the manner required by law and shall at the same time publish a supplementary notice setting forth the purpose of said Uniform Traffic Code and of the fact that complete copies of the Code are available at the office of the Clerk for inspection by and distribution to the public at all times.
      "Sec. 4. CONFLICTING ORDINANCES REPEALED
      "All ordinances and all provisions therein inconsistent with the provisions of the Uniform Traffic Code, to the extend of such inconsistency, are hereby repealed, effective when Uniform Traffic Code ordinance becomes effective.
      "Sec. 5. EFFECTIVE DATE OF THIS ORDINANCE
      "The Uniform Traffic Code will be in effect in this governmental unit ten (10) days after publication of this adopting ordinance. Adopted: February 2, 1959.”

       The February 5, 1959, edition of the South Lyon Herald also contained an article referring to the enactment of the code, which improperly refers to it as the "Uniform Motor Vehicle Code”.

       We note that MCL 257.625; MSA 9.2325 proscribes the same conduct, driving under the influence of intoxicating liquor, that was covered by the ordinance under which defendant was charged. We express no opinion at this time as to whether defendant can now be charged with a violation of the state statute.


author: T. M. Burns, J.

text:
    PEOPLE v DALTON
    Docket No. 78-1902.
    Submitted February 6, 1979, at Grand Rapids.
    Decided July 10, 1979.
    Calvin Dalton was charged in an indictment with obtaining money by false pretenses and with violation of the securities law. At the preliminary examination, the indictment was quashed. The prosecutor then filed a new complaint, warrant and information charging the same offense. Defendant moved to quash the information on the ground that the statute of limitations had run. The Kent Circuit Court, John T. Letts, J., denied the motion and the defendant appeals by leave granted. Held:

    In the absence of a statute specifically providing for tolling of the statute of limitations while the improper indictment was pending, the statute continued to run. The new information was filed more than six years after the offense charged; therefore, the trial court erred in denying the defendant’s motion. The statute of limitations does not run, however, during any period when the accused was not a resident of the state. Because there was some testimony at the preliminary examination that the defendant was absent from Michigan for a period of time during the six-year period, the case is remanded for further fact-finding on this issue, if the prosecution so desires.
    Reversed and remanded.
    1. Indictment and Information —■ Limitation of Actions — Tolling of Statute — Invalid Indictment or Information.
    Generally, the return of an indictment or the filing of an information on which no valid conviction or judgment can be had will not, in the absence of statute expressly so providing, operate to stop the running of the statute of limitations pending the return or filing of another indictment or information.
    References for Points in Headnotes

       21 Am Jur 2d, Criminal Law § 163.

       21 Am Jur 2d, Criminal Law § 155.

       21 Am Jur 2d, Criminal Law § 154 et seq.

      2. Limitation of Actions — Criminal Law — Statutes — Construction of Statutes.
    Statutes of limitation on criminal prosecutions are to be liberally construed in favor of the accused, and exceptions from the benefits of such statutes are to be construed narrowly or strictly against the state.
    3. Limitation of Actions — Criminal Law — Tolling of Statute — Invalid Indictment or Information — Statutes.
    Michigan has no statute specifically providing for the tolling of the statute of limitations for criminal prosecutions during the pendency of an improper indictment or information; therefore, the statute of limitations continued to run where an indictment was returned but was later quashed, and a subsequent complaint, warrant and information filed more than six years after . the criminal offense charged was ineffective unless the accused was, during the six-year period, not a resident of the state, during which time of nonresidence the statute did not run (MCL 767.24; MSA 28.974).

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, David H. Sawyer, Prosecuting Attorney, and Donald A. Johnston, Chief Appellate Attorney, for the people.

      James W. Zerrenner, for defendant.
    Before: D. F. Walsh, P.J., and J. H. Gillis and T. M. Burns, JJ.
   T. M. Burns, J.

This Court granted defendant leave to file an interlocutory appeal in this case to consider an important question concerning interpretation of the statute of limitations for criminal cases. MCL 767.24; MSA 28.964. The question is whether a criminal prosecution begun by filing a complaint, warrant and information more than six years after the date of the last act charged therein is barred where the same offenses had been charged in an indictment within the six-year period, but the indictment had been quashed.

Both the indictment which was quashed and the information which is in issue here alleged that defendant had on October 21, 1970, and diverse other dates between that date and January 1, 1971, engaged in conduct which amounted to obtaining funds over $100 by false pretenses, MCL 750.218; MSA 28.415, and was also a violation of the securities law. MCL 451.501, 451.809; MSA 19.776(101), 19.776(409).

The indictment was returned on October 17, 1975. For reasons not adequately explained by the record, the preliminary exam was not held until January 11, 1977. After the hearing, the district court issued an opinion and order quashing the indictment because the one-man grand jury had taken no testimony and the prosecution refused to comply with the discovery order issued by the circuit court. See People v Bellanca, 386 Mich 708; 194 NW2d 863 (1972), GCR 1963, 787. The order dismissing the indictment was filed February 3, 1977.

The prosecutor made no attempt to appeal the dismissal of the indictment. Instead, a different prosecution was begun by filing a new complaint, warrant and information on February 22, 1977. An examination was held and defendant bound over to circuit court on April 20, 1977. Defendant moved to quash the information on the ground that the statute of limitations had expired. The motion was denied. We granted leave June 23, 1978.

The statute at issue provided:

"An indictment for the crime of murder may be found at any period after the death of the person alleged to have been murdered; indictments for the crimes of kidnapping, extortion, assault with intent to commit murder and conspiracy to commit murder shall be found and filed within 10 years after the commission of the offense; all other indictments shall be found and filed within 6 years after the commission of the offense; but any period during which the party charged was not usually and publicly resident within this state shall not be reckoned as part of the time within which the respective indictments shall be found and filed.” MCL 767.24; MSA 28.964.

In denying the motion to dismiss, the trial court found there are three basic types of limitations statutes for criminal cases: (1) statutes which provide that an indictment must be found and returned within a specified time after the commission of the offense charged; (2) statutes which do not refer to the time of the finding of an indictment or the filing of an information, but merely provide that prosecutions must be commenced within the specified time; and, (3) statutes which provide that the statute of limitations is tolled for a specified period of time if an indictment or information is quashed, set aside, dismissed, or otherwise fails. See, Anno: Findings or returning of indictment or information within period of limitation as stopping running of limitation against prosecution, 90 ALR 452. Citing People v Clark, 33 Mich 112 (1876), People v Clement, 72 Mich 116; 40 NW 190 (1888), and People v Hendershot, 357 Mich 300; 98 NW2d 568 (1959), the circuit court held that Michigan’s statute of limitations was a type 2 statute and the limitations period was tolled from the time the prosecution was "commenced”. The court further found that this prosecution was commenced with the return of the original indictment and thus properly brought within the six years allowed by the statute.

Both Clark and Clement were prosecutions for seduction. The statute under which these prosecutions were had, How Stat § 9283, provided that "no prosecution shall be commenced under this * * * section, after one year from the time of committing the offense”. That statute was and is a "commencing” statute of limitations, but it is not applicable here and its language must be contrasted with the "found and filed” language of the applicable statute.

Hendershot involved the proper statute but answered a different question. In Hendershot, the complaint was filed and a warrant issued in 1951. Defendant was serving a term in prison so a detainer was filed with the prison authorities. Defendant was not prosecuted for that offense until 1958. The main question in the case dealt with an interpretation of the 180-day rule, MCL 780.131 et seq.; MSA 28.969(1) et seq. The Court’s entire analysis of the statute of limitations question is contained in a single paragraph:

"Defendant says the statute of limitations (CLS 1956, § 767.24 [Stat Ann 1954 Rev § 28.964]) has run because the warrant, when issued, was not placed in the hands of an officer for service, so as to toll the running of the statute. The record contains no support for the factual assertion. It does disclose that upon issue of the warrant a detainer was filed against the defendant with prison authorities. That is the extent of what an officer properly could have done about serving the warrant at the time. This served to toll the statute.” 357 Mich at 304.

The most that can be extracted from this brief passage is that for cases where no indictment is "found and filed” the statute is tolled by filing a complaint and having a warrant issued. In the present case the complaint was filed and the warrant was issued more than six years after the last act charged in the information.

The real problem lies with the effect to be given the indictment which was quashed. This question has not been faced in this state. In other jurisdictions, "Generally, the return of an indictment or the filing of an information on which no valid conviction or judgment can be had will not, in the absence of a statute expressly so providing, operate to stop the running of the statute of limitations pending the return or filing of another indictment or information.” 21 Am Jur 2d, Criminal Law, § 163, pp 229-330. See also, 22 CJS, Criminal Law, § 237 (stating a similar rule).

As noted above, our statute requires that the indictment be found and filed within six years. Under Hendershot, for prosecutions begun by complaint and warrant, they must be issued within six years. Under our statute, it is not enough that the prosecution merely be "commenced”, as might be sufficient in some states; certain acts must be done within the period of limitations or the prosecution is barred.

"Protection from prosecution under a statute of limitations is a substantive right, not a mere procedural one; in all cases subject to limitation the period prescribed by the statute is jurisdictional, the time within which an offense is committed is a jurisdictional fact, and it is incumbent on the state to prove that the offense was committed within the time fixed by the statute.

"Although statutes of limitation on criminal prosecutions are to be accorded a rational meaning in harmony with the obvious intent and the purpose of the law, such statutes are to be liberally construed in favor of the accused, and exceptions from the benefits of such statutes are to be construed narrowly or strictly against the state.” 21 Am Jur 2d, Criminal Law, §§ 154-155, pp 223-224 (footnotes omitted).

The trial court’s conclusion on this point was incorrect. Since Michigan has no statute specifically providing for tolling while the improper indictment was pending, the statute continued to run.

Having reached what we consider the correct interpretation of the statute as it relates to these facts it might seem that defendant is entitled to be discharged. However, the statute does not run during any period "during which the party charged was not usually and publicly resident within this state”.

There was some testimony at the preliminary exam that defendant was absent from this state from July 4, 1974, to November 26, 1975. The district court excluded defense testimony to the contrary and the circuit court, given its interpretation of the statute, did not reach this question. It is only fair that we remand for further evidence and fact-finding on this point if the prosecution desires to press it further. If defendant was not absent from the jurisdiction as claimed below, the statute was not tolled for this reason and defendant is entitled to be discharged.

Reversed and remanded for proceedings not inconsistent with this opinion.

       This statute is currently MCL 750.532; MSA 28.800.

        People v Curtis, 389 Mich 698; 209 NW2d 243 (1973), provides some support for this analysis. Curtis held that a prosecuting attorney had discretion to nol-pros at the magistrate level and that the circuit court could not require that the accused be examined on a higher charge than is alleged in the information. The Court pointed out that, prior to our nolle prosequi statute, a prosecutor could nolpros a prosecution on his own at any time and later retract the nolle prosequi and immediately proceed on the original indictment. The Court pointed out that the nolle prosequi statute "had the effect of requiring a prosecuting attorney who entered a nolle prosequi after indictment to obtain a new indictment and begin proceedings anew if he wished to reinstate the original charge”. The Court concluded: “Today, as long as jeopardy has not attached, or the statute of limitations not run, our law permits a prosecutor to reinstate the original charge on the basis of obtaining a new indictment and thus beginning the process anew.” 389 Mich at 706 (emphasis added).

       This language was construed in People v McCausey, 65 Mich 72; 31 NW 770 (1887), and the holding in that case shall guide the circuit court on remand.


author: Allen, J. Mackenzie, J.

text:
    ROWE v NOREN PATTERN & FOUNDRY CO.
    Docket No. 78-2059.
    Submitted March 7, 1979, at Grand Rapids.
    Decided July 10, 1979.
    Leave to appeal applied for.
    Defendant, Noren Pattern & Foundry Co., offered a job to plaintiff, Reginald Rowe, who was a longtime employee of another foundry and was within 1-1/2 years of having his pension vest. Plaintiff was told he would have to become a member of the union after 45 days. Plaintiff quit his job and went to work for defendant, but his employment was terminated after 43 days. Plaintiff sued defendant, alleging an oral contract of employment. The Muskegon Circuit Court, Frederic A. Grimm, J., granted a directed verdict for defendant at the close of plaintiffs proofs for the reasons that the contract violated the statute of frauds and was a contract for permanent employment, which is a contract at will terminable with or without , cause by either party at any time. Plaintiff appeals. Held:

    1. An oral contract which is capable of being completed in less than one year is not violative of the statute of frauds even though it is clear that in all probability the contract will extend for a period of years. Plaintiffs contract with defendant was conceivably capable of being completed within one year and is not violative of the statute of frauds.
    2. A contract for employment for an indefinite period, in the absence of some special consideration passing from the employee to the employer, is terminable at the will of either party. An employee under such a contract may be terminated with or without cause, the decision being solely within the determination of the employer, however, this rule does not apply to a situation where an employer lured an employee away from employment on which he was 1-1/2 years away from having his pension vest to a job in which he was to have the protection of union membership after 45 days and to which he would not have switched but for the guaranty of the protection of a union contract.

      References for Points in Headnotes

       73 Am Jur 2d, Statute of Frauds § 533.
    Performance as taking contract not to be performed within a year out of the statute of frauds. 6 ALR2d 1053.

       53 Am Jur 2d, Master and Servant §§ 17, 27, 32-34.
    Validity and duration of contract purporting to be for permanent employment. 60 ALR3d 176.

      Reversed.
    Mackenzie, J., dissented. She would hold that the contract was an employment contract for an indefinite period terminable at will by either party until the protection of the union contract attached and that plaintiffs giving up his prior job with its attendant benefits was not a bargained-for benefit to defendant to qualify under the exception to the rule. She would affirm.
    Opinion of the Court
    1. Frauds, Statute of — Oral Contracts — Completion Within One Year.
    An oral contract which is capable of being completed in less than one year is not violative of the statute of frauds even though it is clear that in all probability the contract will extend for a period of years.
    2. Master and Servant — Contract of Employment — Employment at Will — Termination of Employment.
    A contract for employment for an indefinite period, in the absence of some special consideration passing from the employee to the employer, is terminable at the will of either party; an employee under such a contract may be terminated with or without cause, the decision being solely within the determination of the employer; however, this rule does not apply to a situation where an employer lured an employee away from employment on which he was 1-1/2 years away from the vesting of his pension to a job in which he was to have the protection of union membership after 45 days and to which he would not have switched but for the guaranty of the protection of a union contract and terminated the employment after 43 days.
    Dissent by Mackenzie, J.
    3. Master and Servant — Contract of Employment — Termination of Employment.

      A contract for employment for an indeñnite term, absent some special consideration passing from the employee to the employer, may be terminated by either party at any time for any reason, and an employee serving under such a contract has no cause of action for damages for wrongful discharge; the giving up, by the employee, of his prior position and its attendant

      benefits is not a bargained-for benefit to the employer sufficient to serve as such consideration.

      Norman C. Halbower, P.C., for plaintiff.

      CollingSilky & Kobza (by Thomas L. Riegler), for defendant.
    Before: R. B. Burns, P.J., and Allen and Mackenzie, JJ.
   Allen, J.

At the conclusion of plaintiffs proofs in a trial by jury on plaintiffs claim against defendant for breach of an oral contract of employment, defendant’s motion for a directed verdict against plaintiff was granted. In granting the motion on May 3, 1978, the trial court stated it found Toussaint v Blue Cross & Blue Shield of Michigan, 79 Mich App 429; 262 NW2d 848 (1977), controlling and that plaintiffs claim should be denied because the contract (1) was for more than one year and therefore was in violation of the statute of frauds, and (2) was a contract for permanent employment which, under Michigan law, is a contract at will terminable with or without cause by either party at any time. Plaintiff appeals of right.

To the extent that the trial court granted the directed verdict on the basis of the statute of frauds defense, we find error. While it is true that the contract of employment was intended to continue for more than one year, it is also true that, technically speaking, it could have been performed within one year. Plaintiff testified that when defendant sought his services he was told that after he had worked for defendant for 45 days he would become a member of the union, after which he could only be fired for just cause. At another point, plaintiff testified he was informed "that the only way I would get laid off is if the company closed down”. Since the company could have been closed down within one year or since plaintiff could have performed his assigned duties so poorly as to give bis employer just cause to discharge him, the contract oí' employment could have been for less than a year.

Where an oral contract may be completed in less than a year, even though it is clear that in all probability the contract will extend for a period of years, the statute of frauds is not violated. Fothergill v McKay Press, 361 Mich 666, 668; 106 NW2d 215 (1960), quoted with approval the following language from Smalley v Mitchell, 110 Mich 650, 652; 68 NW 978 (1896):

"The mere fact that the contract may or may not be performed within the year does not bring it within the statute. The rule is that if, by any possibility, it is capable of being completed within a year, it is not within the statute, though the parties may have intended and thought it probable that it would extend over a longer period, and though it does so extend.” (Emphasis supplied.)

Furthermore, it appears that under the rationale of Pursell v Wolverine-Pentronix, Inc, 44 Mich App 416, 419-420; 205 NW2d 504 (1973), and Conel Development, Inc v River Rouge Savings Bank, 84 Mich App 415, 423; 269 NW2d 621 (1978), plaintiff’s giving up of his prior job where he had been employed for 13-1/2 years, and his soon-to-vest retirement benefits constituted a reliance sufficient to circumvent the statute of frauds, at least by raising a question of fact to be resolved by the jury.

The question of whether the trial court was correct in concluding that the oral agreement was for employment of indefinite duration and, as such, was a contract terminable at will, is more difficult to resolve. In Michigan, as well as in a majority of states, the rule is well established that, in the absence of some special consideration passing from the employee to the employer, other than the services to be performed by the employee, a contract for employment for an indefinite term is a contract which may be terminated at any time by either party for any reason or for no reason at all. Lynas v Maxwell Farms, 279 Mich 684, 689; 273 NW 315 (1937), Adolph v Cookware Co of America, 283 Mich 561, 568; 278 NW 687 (1938), McLaughlin v Ford Motor Co, 269 F2d 120, 125 (CA 6, 1959), Percival v General Motors Corp, 539 F2d 1126 (CA 8, 1976), Milligan v The Union Corp, 87 Mich App 179; 274 NW2d 10 (1978). Cf. Anno: Employee’s arbitrary dismissal as breach of employment contract terminable at will, 62 ALR3d 271. Further, in a majority of jurisdictions, relinquishment by the employee of a job, business or profession in order to accept the new position of permanent employment does not constitute special consideration sufficient to support the contract. Anno: Validity and duration of contract purporting to be for permanent employment, 60 ALR3d 226, 264-266, Lynas, supra, Adolph, supra.

But, because the rule is sometimes harsh and offers opportunities for arbitrary dismissal, the courts have been quick to find exceptions. As is stated in Anno: "Validity and duration of contract purporting to be for permanent employment”, 60 ALR3d 226, 232:

"Notwithstanding the above-stated rule that an employment contract which is indefinite as to duration will be considered terminable at will, many courts will hesitate to hold an employment contract unenforceable merely because it fails to specify a term of employment. Before holding an employment contract indefinite for such a reason, the courts will look to the intention of the parties for clues as to the intended duration of the contract, this understanding and intent of the parties to be ascertained from the written and oral negotiations of the parties, business custom and usage, the situation of the parties, the nature of the employment, and the particular circumstances of the case.” (Footnotes omitted, emphasis supplied.)

Likewise, an exception to the rule is recognized where it is clear that the employer knew at the time of the hiring that the employee would not have left his former position except for the offer of a permanent position. 60 ALR3d 267 and cases cited. Thus, where the job which is given up is "tenured” or permanent and the new job offer is also tenured or permanent, special consideration is found to exist. Collins v Parsons College, 203 NW2d 594 (Iowa, 1973).

This brings us to the key issue. Does the situation in the case before us fall within the general rule or within one of the exceptions? Or, stated another way, is the instant employment contract a Toussaint v Blue Cross or McLaughlin v Ford Motor Co situation, or is it something else? We conclude it is something else.

Plaintiff’s testimony was clear and straightforward. He stated that for 13-1/2 years he was the "fix-it man of all types” in charge of maintenance work at Muskegon Aluminum where he was paid $4.52 an hour working 50 to 60 hours a week. He stated that he was close to having a vested pension with only a year and one-half remaining before his pension vested; that without any solicitation from him, Nils Bodman, an employee of defendant Noren Pattern & Foundry Company (Noren), contacted him saying that Noren needed a maintenance man and "how much better they could do” him; that he was contacted by Bodman three or four times until finally a meeting was arranged at the Noren plant where Bodman introduced plaintiff to Jim Surge, personnel manager at Noren; that Noren was particularly interested in whether plaintiff knew how to keep a Hunter Automatic Molding Machine operating; that plaintiff had been operating a Hunter machine for several years at Muskegon Aluminum and had taken schooling for it; that Noren offered $5.30 an hour to begin work; that Surge stated he wanted plaintiff to come to work for him and wanted to know what else he could do to get plaintiff to come to work. At this point the transcript of plaintiff’s testimony shows:

"Q [counsel for plaintiff] Did you explain what else he could do to get you to come there?
"A Yes. I asked him what kind of a guarantee could he give me that I would work for—that I wouldn’t be laid off in a week or two weeks or a year or what have you. And he said that he couldn’t give me a written agreement because there was a union there and I had to join the union in 45 days. But he said in 45 days I would have to join the union.
"Q When you were talking about job security, what was said?
"A He said that he couldn’t give me a written thing— a guarantee—that I would work there, but that I would work for 45 days and I would join the union. Then I would be covered under the union contract and—
"Q Did Mr. Surge ever tell you that the 45 days was a probation period?
"A No. In fact, he told me that it wasn’t. He said—He told me: 'You don’t have to worry about that. You are the man we want. You got the qualifications, and you sure don’t have to worry about—'You know, that they wanted me to come there. There is no way I would have went there for one minute if I didn’t figure that, you know, that I would belong to the union.
"Q During the conversation with Mr. Surge, was the possibility of layoff discussed?
"A Yes, it was.
"Q Would you relate to the Court—
"A I asked him about getting laid off. He said there was no one in the plant that could bump me because there was nobody qualified for that job. They already posted it and they couldn’t get no one to fill it. And he said—[h]e went on to say that the only way that I would get laid off is if the company closed down.
"Q Were you given, at any time prior to your termination, a copy of the union contract?
"A No.
"Q Were you ever told that you had to undergo a 45-day probation period?
"A No, sir. It was the opposite. He told me that—led me to believe just exactly the opposite—that I would not be on probation, that they knew what I could so. They wanted me there. It was just a matter of—I had to be there 45 days before I could join the union.”

Plaintiff’s testimony was not rebutted since defendant’s motion came at the conclusion of plaintiff’s proofs. Neither was plaintiff’s testimony damaged or otherwise qualified by cross-examination. Therefore, it must be taken at face value. As such, we are persuaded that the agreement was not the typical "you come to work for us and you may have a job forever or until retirement as long as your work is satisfactory” employment agreement. That is the type agreement found in Toussaint, supra, McLaughlin, supra, Percival, supra and Milligan, supra. In the case before us we find an agreement that plaintiff would work a specific period of 45 days, after which he would be a union member and would continue working subject to the protections given in the normal union contract. The protection of a union contract is an added ingredient which is not present in Toussaint, Milligan or the other cases supportive of the general rule. Further, plaintiffs unrefuted and unshaken testimony that even with the higher salary he would not have switched jobs without coming under the protective umbrella of union membership is a meaningful and significant factor. In an article entitled Employment at Will vs. Individual Freedom: On Limiting The Abusive Exercise of Employer Power, 67 Columbia L Rev 1404, 1405, 1410 (1967), Professor Blades levels a sharp criticism of the contract at will doctrine, saying:

"Despite this irreversible trend, the law has adhered to the age-old rule that all employers 'may dismiss their employees at will * * * for good cause, for no cause, or even for cause morally wrong [emphasis by Prof. Blades] without being thereby guilty of legal wrong.’ This traditional rule, which forces the nonunion employee to rely on the whim of his employer for preservation of his livelihood, is what most tends to make him a docile follower of his employer’s every wish. [Emphasis supplied.]
"The labor union, of course, has been a significant source of protection for the employee from all sorts of arbitrary action by the employer. Among the many managerial rights which have been limited by collective bargaining agreements is the right of discharge. Through the 'just cause’ provisions typically found in collective agreements unions not only protect their constituents from discharges for ulterior purposes, but also prohibit discharges for no reason or for reasons erroneously believed by the employer to be justified.” (Footnotes omitted.)

Under the collective bargaining agreement, plaintiff could have only been discharged "for good cause”. When plaintiff was summarily fired on the 43rd day of work he was denied the protection without which he would not have taken the position in the first place. Further, he was denied the protection referred to at footnote 2 in Percival, supra.

Finally, we note that the instant case also differs from Toussaint and the earlier Michigan cases cited in that plaintiff was giving up a virtually assured position and pension for the rest of his life. In this respect the instant case is similar to Collins v Parsons College, supra, where the court refused to follow the fire-at-will doctrine when a tenured or secured position was being given up. While Michigan has not yet adopted the rule relied on there and as stated in 60 ALR3d 267, supra, neither has Michigan rejected the doctrine.

Our decision to reverse the grant of summary judgment in favor of defendant and remand to the trial court in no way suggests that defendant was without just cause to discharge plaintiff. On that issue we take no position but leave defendant to put in its proofs. Likewise we take no position on the quantum of proof of damages.

Reversed, costs to plaintiff.

R. B. Burns, P.J., concurred.

Mackenzie, J.

(dissenting). I dissent. Although I agree with the majority’s disposition of the statute of frauds issue, I disagree with its treatment of the issue concerning the terminability of the employment contract.

As the majority notes, the general rule, adhered to in Michigan, is that a contract for employment for an indefinite term may be terminated by either party at any time for any reason, absent some special consideration passing from the employee to the employer. Toussaint v Blue Cross & Blue Shield of Michigan, 79 Mich App 429; 262 NW2d 848 (1977), lv gtd on separate grounds, 402 Mich 950h (1978), McMath v Ford Motor Co, 77 Mich App 721, 724; 259 NW2d 140 (1977). An employee serving under such contract has no cause of action for damages for wrongful discharge. Milligan v The Union Corp, 87 Mich App 179, 182; 274 NW2d 10 (1978). I disagree with the majority that there is sufficient reason to deviate from the general rule in the instant case.

It is true that the protection of a collective bargaining agreement was an enticing feature of employment with the defendant. It is additionally true, however, that the protective features of the agreement were unavailable to the plaintiff until he became a union member, and that such membership was to be delayed until he had been employed by the defendant for a period of 45 days.

One of the protective clauses of the union contract was that an employee could only be discharged "for good cause”. To provide such protection to the plaintiff prior to the termination of the 45-day period is to afford the plaintiff one of the protective devices of the contract prior to his having qualified for it. The agreement, however, specifically directs that the employer need not comply with the provisions during the 45-day period, over the course of which an employee is considered probationary.

The majority has apparently adopted the exception to the "fire-at-will” rule which considers the rule inapplicable when a tenured or secured position is being given up. Absent specific Supreme Court directive, I decline to adhere to this position. The approach is clearly contrary to prior case law in this state. According to the Supreme Court in Adolph v Cookware Co of America, 283 Mich 561, 568; 278 NW 687 (1938):

"Plaintiff’s proofs, taken as true, showed a contract for permanent employment. Such a contract is for an indefinite period and, unless for a consideration other than promise of services, the employment was terminable at the will of either party. Lynas v. Maxwell Farms, 279 Mich. 684, and cases there cited.
"The action of plaintiff in giving up the practice of his profession was but an incident necessary on his part to place himself in a position to accept and perform the contract and not a price or consideration paid to defendant for the contract of employment.”

See also Lynas v Maxwell Farms, 279 Mich 684; 273 NW 315 (1937), Milligan v The Union Corp, supra. A mere detriment to the employee is, by itself, insufficient to serve as consideration; the employer must receive some form of benefit. The relinquishment of his previous position and its incident benefits by the plaintiff was not a bargained-for benefit received by the defendant.

I would affirm.

       Admittedly, there are cases to the contrary. Relinquishment of prior employment has been held sufficient consideration to support a contract for permanent employment in Jones v Carolina Power & Light Co, 206 NC 862; 175 SE 167 (1934), Millsap v National Funding Corp of California, 57 Cal App 2d 772; 135 P2d 407 (1943), 60 ALR3d 268, supra.

       Counsel for defendant elected not to cross-examine plaintiff but to call plaintiff for cross-examination as part of defendant’s case.

       At oral argument defendant said that the firing was for just cause and that if summary judgment were set aside defendant’s proofs would establish that just cause existed.


text:
    DE GRAAF v CITY OF ALLEGAN
    Docket No. 78-2201.
    Submitted February 7, 1979, at Grand Rapids.
    Decided July 10, 1979.
    Plaintiff, Garry De Graaf, worked as a part-time police officer for the City of Allegan in 1975. He resigned after two weeks. In 1976, he was hired by the chief of police to fill in for regular officers on vacation and disciplinary lay-off and worked during September and October. In October the city began a police reserve system under which part-time employees were paid $3 an hour. Plaintiff worked under this system until the end of November, 1976.
    After the last day of employment, he requested and was granted a veterans preference hearing. The city council determined that the plaintiff was not entitled to the protection of the veterans benefit act because he was a part-time employee.
    The plaintiff sought review of the decision by filing a complaint for a writ of mandamus in circuit court. The circuit court considered mandamus as an inappropriate action and treated the pleading as a complaint for superintending control. The Allegan Circuit Court, George R. Corsiglia, J., determined that the plaintiff had not been fired, but rather, had voluntarily quit. The court then determined that veterans who voluntarily left their employment had no rights under the act and dismissed the case. The plaintiff appeals. Held:

    1. A veteran who has voluntarily quit his job is not entitled to a hearing under the act.
    2. The court acted properly in reserving unto itself the determination of whether the act applied to the defendant in this instance. Both the question of whether the act applies to a veteran who voluntarily leaves his job and the question of whether the plaintiff here did so are judicial questions.

      References for Points in Headnotes

       77 Am Jur 2d, Veterans § 117.

       77 Am Jur 2d, Veterans § 28.

       4 Am Jur 2d, Appeal and Error § 76.
    5 Am Jur 2d, Appeal and Error § 839.
    Formal requirements of judgment or order as regards appealability. 73 ALR2d 250.

      3. The trial court’s determination that the plaintiff had voluntarily quit his job is not clearly erroneous.
    Affirmed.
    1. Statutes — Veterans — Veterans Preference Act — Voluntary Termination of Employment — Hearings.
    An involuntary termination of a veteran’s employment is necessary before the veteran may invoke the protections afforded by the veterans preference act; a veteran who voluntarily quits his employment is not entitled to a hearing under the act (MCL 35.402; MSA 4.1222).
    2. Statutes — Veterans — Veterans Preference Act — Voluntary Termination of Employment — Judicial Questions.
    The question whether the veterans preference act applies to a veteran who voluntarily, leaves his job and the question whether, in a specific instance, a veteran voluntarily left his job are both judicial questions.
    3. Appeal and Error — Findings of Fact — Bench Trial — Court Rules.
    The findings of fact in an action tried without a jury are not to be set aside on appeal unless clearly erroneous (GCR 1963, 517.1).

      Donald H. Hann, for plaintiff.

      Jacobs & Ward, for defendant.
    Before: D. F. Walsh, P.J., and J. H. Gillis and T. M. Burns, JJ.
   T. M. Burns, J.

The questions in this case relate to the circuit court’s role in a suit involving an alleged violation of the veterans preference act. MCL 35.401 et seq.; MSA 4.1221 et seq.

Plaintiff worked as a part-time police officer for defendant in 1975. He resigned after two weeks. In August of 1976, the chief of police again contacted plaintiff to fill in for regular officers on vacation and disciplinary lay-off. Plaintiff worked from September to October, being paid the hourly rate for new officers. In October the city began a police reserve system under which the part-time employees were paid $3 an hour. Plaintiff worked under this system until the end of November.

After his last day of work, plaintiff requested and was granted a veterans preference hearing. The city council determined that plaintiff was not entitled to the protection of the act because he was a part-time employee. At that point no issue had been raised over whether plaintiff had been fired or quit because the police chief who had employed plaintiff had also left office.

Plaintiff sought review of the hearing body’s decision by filing a complaint for a writ of mandamus in the circuit court. The circuit court considered a mandamus action inappropriate, Lenz v Mayor of Detroit, 338 Mich 383, 396; 61 NW2d 587 (1953), but treated the pleading as a complaint to seek superintending control. The circuit court indicated that before review of the veterans preference hearing was possible, it was first necessary to determine whether plaintiff had been entitled to a hearing. Testimony was taken and the circuit court found that plaintiff had not been fired, but rather, had voluntarily quit. The court then determined that veterans who voluntarily left their employment had no rights under the act and dismissed the case.

On the record as developed there are three questions. First, is an individual who voluntarily leaves a position with a public employer entitled to a veterans preference hearing if he changes his mind and wants his position back? Second, is the circuit court limited to the record made before the hearing body or can it take evidence and make findings of fact concerning the circumstances surrounding the termination of employment and, thus, whether plaintiff was entitled to a hearing in the first place? And, finally, was the circuit court’s conclusion in this case that plaintiff voluntarily quit clearly erroneous?

The first question has never been asked in this state for obvious reasons. If an individual quits his job he generally wouldn’t be interested in a hearing to determine whether he could have been fired. However, the answer is clearly implied in the statute. MCL 35.402; MSA 4.1222 provides in relevant part:

"No veteran * * * holding an office or employment in any public department or public works of the state or any county, city or township or village of the state, * * * shall be removed or suspended, or shall, without his consent, be transferred from such office or employment except for official misconduct, habitual, serious or willful neglect in the performance of duty, extortion, conviction of intoxication, conviction of felony, or incompetency; and such veteran shall not be removed, transferred or suspended for any cause above enumerated from any office or employment, except after a full hearing before the governor of the state if a state employee, or before the prosecuting attorney if a county employee, or before the mayor of any city or the president of any village, or before the commission of any such city or village operating under a commission form of government, if an employee of a city or village, or before the township board if a township employee, and at such hearing the veteran shall have the right to be present and be represented by counsel and defend himself against such charges.”

From the language used it is implicit that a veteran who quits his employment is not entitled to a hearing under this section. An involuntary termination is necessary to invoke the protections afforded by the act. If plaintiff quit his job he was not entitled to a hearing under the act.

The second question is more difficult. In the more typical case, review would be of the record in the nature of certiorari, to determine whether the decision of the authority which held the veterans preference hearing was supported by competent, material and substantial evidence. See, e.g., Smith v Mayor of the City of Ecorse, 81 Mich App 601; 265 NW2d 766 (1978). The question in this case isn’t whether the determination at the hearing was correct, but whether plaintiff was entitled to a hearing at all. The fact that a hearing has been held does not affect this inquiry.

In Owen v Detroit, 259 Mich 176; 242 NW 878 (1932), plaintiffs position with the city was abolished for reasons of economy. Plaintiff did not seek a hearing before the mayor but instead brought suit in circuit court in the nature of mandamus to compel reinstatement. The Court held that the statute did not prevent the city from abolishing a veteran’s job if it was done in good faith and not as a subterfuge to avoid the veterans preference. The Court concluded:

"It is contended, however, that determination of the question of good faith in abolishing the position was exclusively for the mayor. It may be conceded that, in passing upon whether a removal is for cause, the mayor may inquire into the good faith of the discharge. But if the position is legally abolished, the statute does not apply, and the employee has no right to a hearing,' nor the mayor power to grant one. Whether the statute applies to a situation necessarily must be a judicial question.” 259 Mich at 178.

The same reasoning applies here. The questions of whether the act applies to a veteran who voluntarily leaves his job and whether the plaintiff here did so are judicial questions. There is nothing to prevent the circuit court from determining whether the act applies to the facts as it finds them. It is only where the act is found to apply that the court would be limited to a review function and thus the record made in the administrative setting. The court did not err in reserving unto itself the determination of the act’s applicability, the question being a purely judicial one.

The final question is the soundness of the court’s conclusion that plaintiff had voluntarily quit his job. Under the view of the case taken above, the finding of fact must be reviewed under GCR 517.1. Our consideration of the testimony and the trial court’s findings based on that testimony does not leave us with a definite and firm conviction that a mistake has been committed. Tuttle v Dep’t of State Highways, 397 Mich 44; 243 NW2d 244 (1976).

Affirmed. No costs, construction of a statute being involved.

       The writ of certiorari has been superseded by superintending control. GCR 1963, 711.3.

       The trial court’s concise findings of fact and conclusions of law were stated at the end of the hearing in circuit court:
      “Mr. Brandt has testified to the best of his recollection that Mr. DeGraaf was taken off the schedule because he indicated to Mr. Brandt he no longer wanted to work for the City of Allegan at $3.00 an hour, and I believe that testimony.
      "Therefore, it’s this court’s conclusion and opinion that Mr. De-Graaf terminated his employment. It seems that maybe he changed his mind later, but I think once that termination was made and he told that to Mr. Brandt and Mr. Brandt took steps to replace him, that he can’t later change his mind, and that appears to this court what he did, he just changed his mind.
      "There isn’t any evidence whatsoever to show that Mr. Brandt took his name off the schedule for any reason but the fact that Mr. DeGraaf said he no longer wanted to work for the City of Allegan at $3.00 an hour. Everything is consistent with that, and therefore, since this Court finds that he did in fact terminate his employment and it would appear he changed his mind later, but the City acted on what he told them. They took his name off the schedule, he didn’t contest it; and it was after his name was taken off the schedule and apparently after he was told to turn in his uniform, that he sent his letter to the City requesting the hearing under the Veterans Preference Act.
      "In this court’s opinion, the City doesn’t have any duty or obligation to give him that hearing because he terminated his employment and they accepted it and that was the end of it.”