author: M. J. Kelly, J.

text:
    KANSAS CITY LIFE INSURANCE COMPANY v DURANT
    Docket No. 44285.
    Submitted May 6, 1980, at Lansing
    Decided September 2, 1980.
    Leave to appeal applied for.
    Plaintiff, Kansas City Life Insurance Company, brought an action to recover a deficiency on mortgages of defendants’ property held by plaintiff following foreclosure sales of the property and for damages arising out of a breach of an alleged oral contract. Oakland Circuit Court, Robert L. Templin, J., found no cause of action as to the breach of contract claim and awarded payment to plaintiff on its claim of deficiency. Defendants appeal. Plaintiff moved for delayed cross-appeal seeking review of the trial court’s decision precluding it from charging an increased rate of interest upon defendants’ default, which motion was granted by the Court of Appeals. Defendants allege 1) that the trial court erred in allowing plaintiff to recover any interest since it found plaintiff had violated the usury statute, 2) that plaintiff is barred from recovery of interest due to its noncompliance with the loan disclosure requirements of the Regulation of Interest Act, and 3) that the trial court erred in deciding that the prices bid on their property at the foreclosure sale were reasonable rather than engaging in a preliminary finding of fact as to the market value of the premises. Held:

    1. The trial court erred in two respects. First it applied the wrong subsection of the usury statute and found that plaintiff had violated its provisions by increasing the rate of interest charged defendant upon default. According to that subsection, such violation would mandate the denial of the recovery of any interest. Secondly, the trial court subsequently awarded plaintiff interest at the original rate, contrary to the statute’s provisions. Plaintiffs increase in the interest rate upon defendants’ default is in compliance with the provisions of the controlling subsection, which clearly applies to the facts presented as to the amount of the mortgage and the nature of the security, and which does not contain a restriction against the increasing of interest rates initially effective.

      References for Points in Headnotes
    [1] 45 Am Jur 2d, Interest and Usury §§ 63, 64, 67.
    55 Am Jur 2d, Mortgages §§ 149, 151.
    [2] 45 Am Jur 2d, Interest and Usury § 307.
    [3] 45 Am Jur 2d, Interest and Usury § 35.
    [4] 5 Am Jur 2d, Appeal and Error § 646.
    58 Am Jur 2d, New Trial § 16.
    [5] 55 Am Jur 2d, Mortgages §§ 918, 922.

      2. Failure to furnish a loan settlement statement as required by statute is not one of the circumstances delineated in the statute which mandates forfeiture of interest. Such failure cannot provide the basis for denying plaintiff recovery of interest.
    3. The foreclosure statute requires that the amount bid on real property at a foreclosure sale must be a substantial reflection of the true value of the property to allow recovery of a deficiency. Although it would have been preferable for the trial court to frame its decision in language borrowed from the statute, its failure to do so does not obscure its findings which were based on the testimony of experts concerning the market value of the properties.
    Affirmed in part, reversed in part.
    1. Interest — Statutory Limitations on Rates — Remedy for Violation — Statutes.
    A statute provides that the parties to a mortgage of less than $100,000, the bona fide primary security for which is a first lien against real property other than a single family residence, may agree in writing for the payment of any rate of interest, but such mortgage shall not provide that the rate of interest initially effective may be increased, and the appropriate statutory remedy for violation of these provisions by charging a higher rate of interest upon default is to deny the payment of any interest (MCL 438.31c[2], [9]; MSA 19.15[lc][2], [9]).
    2. Interest — Regulation of Interest Act — Forfeiture of Interest — Statutes.
    Forfeiture of interest is mandated by the terms of a statute on loan disclosure requirements, where an agreement does not comply with the provisions of the Regulation of Interest Act and where a seller or lender charges interest in excess of that allowed by the act (MCL 438.32; MSA 19.15[2]).
    3. Interest — Loan Settlement Statement — Statutes.
    Failure of a lender to furnish a borrower with a loan settlement statement does not affect the validity of the loan agreement, nor provide a basis for denying interest payments due the lender (MCL 438.31b; MSA 19.15[lb]).

      4. Appeal — Preservation op Issues — Motions — Court Rules.
    Failure of a party to move for a new trial does not waive issues for appeal which were objected to during trial and which were ruled upon by the trial judge in accordance with court rule (GCR 1963, 517.1).
    5. Mortgages — Foreclosure Statute — Actions for Deficiency.
    The foreclosure statute requires that the amount bid on real property at a foreclosure sale must be a substantial reflection of the true value of the property to allow recovery of a deficiency against the mortgagor, and a failure of a trial court to frame its findings regarding the market value of such property in an action to recover a deficiency will not obscure the findings where they are based on expert testimony concerning the value (MCL 600.3280; MSA 27A.3280).

      Patterson & Patterson, Whitfield, Manikoff, Ternan & White (by Robert G. Waddell), for plaintiff. .

      Howard R. Grossman, for defendants.
    Before: Cynar, P.J., and M. J. Kelly and T. Gillespie, JJ.

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

   M. J. Kelly, J.

This action arose out of a loan by plaintiff to defendants. Defendants defaulted, and plaintiff subsequently foreclosed two mortgages it held as security. Plaintiff then brought this action for the deficiency and for damages arising out of breach of an alleged oral contract under which defendants were obliged to care for the properties between the time of foreclosure and the date plaintiff took possession. Following a bench trial, the court found no cause of action as to the breach of contract claim and awarded plaintiff $100,629.53 on the deficiency claim. Defendants appeal as of right, and plaintiff filed a motion for delayed cross-appeal which was granted by this Court.

Defendants executed a promissory note payable to plaintiff in the amount of $450,000. As security for the note, defendants executed mortgages covering certain properties in Ferndale and Marine City, Michigan. Defendants stopped making payments on the note after January 20, 1975. At that time, the principal balance due on the note was $426,648.48, with interest paid to January 1, 1975. Defendants failed to pay the 1973, 1974, and 1975 real estate taxes on the properties. Plaintiff later paid these taxes. At foreclosure sales, the Ferndale property was sold for $251,000, and the Marine City property was sold for $150,000. Plaintiff itself bid in the properties at the foreclosure sales.

Benjamin Beyer, a real estate appraiser, appraised the Ferndale and Marine City properties at plaintiff’s request. Beyer placed the cash market value of the Ferndale property at $255,000 and of the Marine City property at $160,000. Donald J. Hartman, also a real estate appraiser, appraised the properties at defendants’ request. Hartman’s conclusion as to the fair market value of the Ferndale property was $295,000 and as to the fair market value of the Marine City property, $180,-000.

William Schalekamp, a member of plaintiff’s legal department, testified as to the deficiency. His computation as to the deficiency was a follows:

"[$]426,648.48 is the beginning balance. Interest up— I’ll try to divide this so I don’t get it mixed up.
"Interest from 1-1-75 to 12-
[Argument of counsel omitted]
"Is [$]37,331.74. Then interest from 12-31-75 to 2-27-76 which is the date of the sale at Ferndale, $5,932.17; total of [$]469,912.39, less the price of the Ferndale property [$]251,000; [$]218,912.34 [sic, $218,912.39] then is the balance after that sale. And interest then at— excuse me. This is a slightly different calculation inside the board. Then I have taxes of $6,405.54, interest to 6-28-76 of $6,349.66 and interest on the taxes for that period of $96.74. Leaves a total of [$]231,764.33, and that is as of 6-28-76 at which time the Marine City property was sold for $150,000 at foreclosure leaving then a balance of $81,764.33. Per diem interest at $19.60 to today is $18,865.20 for a total as of 2-13-79 of $100,629.53.”

The trial court found that plaintiff had violated the usury statute, MCL 438.31c; MSA 19.15(lc), by increasing, upon defendants’ default, the rate of interest charged from 8-3/4% to 10%. The trial court held that plaintiff could only recover interest at 8-3/4%. Defendants argue that the trial court should not have allowed plaintiff to recover any interest, citing MCL 438.32; MSA 19.15(2):

“Any seller or lender or his assigns who enters into any contract or agreement which does not comply with the provisions of this act or charges interest in excess of that allowed by this act is barred from the recovery of any interest, any official fees, delinquency or collection charge, attorney fees or court costs and the borrower or buyer shall be entitled to recover his attorney fees and court costs from the seller, lender or assigns.”

If, in fact, plaintiff violated the interest statute by charging a higher rate upon default, defendants are correct in claiming that the appropriate statutory remedy is to deny any interest to plaintiff. However, plaintiff submits that the default rate, included within the loan agreement from its inception, does not constitute excess interest and therefore does not trigger application of MCL 438.32; MSA 19.15(2). Resolution of the threshold question, then, requires interpretation of MCL 438.31c(2); MSA 19.15(lc)(2), which provides:

"(2) For the period ending on December 31, 1981, it is lawful for the parties to a note, bond, or other evidence of indebtedness, executed after August 11, 1969, the bona fide primary security for which is a first lien against real property, or a land lease if the tenánt owns a majority interest in the improvements thereon, or the parties to a land contract, to agree in writing for the payment of any rate of interest, but the note, mortgage, contract, or other evidence of indebtedness shall not provide that the rate of interest initially effective may be increased for any reason whatsoever.” (Emphasis added),

and MCL 438.31c(9); MSA 19.15(lc)(9), which provides:

"For the period ending on December 31, 1981, the parties to a note, bond, or other indebtedness of $100,000.00 or more, the bona fide primary security for which is a lien against real property other than a single family residence,, or the parties to a land contract of such amount and nature, may agree in writing for the payment of a rate of interest.”

Careful examination of the above two subsections and MCL 438.32; MSA 19.15(2) leads us to conclude that the trial court erred in two respects. If, in fact, the present agreement violated subsection 2, defendant may not recover any interest. We are convinced, however, that subsection 9 is controlling here. The loan totaled $450,000, secured by mortgages on two industrial plants. Subsection 9 clearly applies to this amount and nature of security, does not distinguish between first and second liens, and does not contain the restriction against increased interest rates provided in subsection two.

Defendants next contend that plaintiff is barred from recovery of any interest according to MCL 438.32; MSA 19.15(2) due to its noncompliance with the loan disclosure requirements of MCL 438.31b; MSA 19.15(lb), which provides:

"A state or national bank, insurance company or lender approved as a mortgagee under the national housing act or regulated by a federal agency shall furnish a loan settlement statement to a borrower upon closing of the loan, indicating in detail the charges the borrower has paid or obligated himself to pay the lender or to any other person in connection with the loan. A copy of the statement shall be retained in the records of the lender.”

There is some dispute between the parties as to whether defendants’ attorney, who solely represented defendants at closing in their absence, received such a document at closing or several months later and whether his receipt on their behalf constituted sufficient statutory compliance. Defendants also argue that the statement itself was deficient for failure to include the cost of life insurance which was a prerequisite to obtaining the loan. We need not address these particular questions since, assuming, arguendo, that plaintiff did fail to comply with the above disclosure statute, such noncompliance does not trigger application of MCL 438.32; MSA 19.15(2). The statute clearly delineates only two circumstances which mandate forfeiture of interest: (1) where the agreement does not comply with the provisions of the Regulation of Interest Act and (2) where the seller or lender charges interest in excess of that allowed by the act. Failure to furnish a loan settlement statement does not fall within either of the above categories. The statement itself is to consist of a detailed list of charges already agreed upon by the parties. It does not affect the validity of the loan agreement. Therefore, failure to supply the borrowers with such a statement is not a basis for denying interest payments due to plaintiff. Cf. Michigan Loan Ass’n v Cahill, 253 Mich 358; 235 NW 182 (1931). While we agree with defendants in the sense that noncompliance with the disclosure requirement ought to result in some form of sanction against the lender, such a provision must originate with the Legislature.

Finally, in an attempt to defeat the deficiency judgment against them, defendants assign error to the trial court’s decision that the prices bid on the property at the foreclosure sale were "reasonable”. It is defendants’ position that their challenge under MCL 600.3280; MSA 27A.3280, dealing with mortgage foreclosures, requires a preliminary finding of fact by the trial court as to the market value of the premises subject to foreclosure, rather than a determination that the "bid-in” price was reasonable. Before addressing the merits of this issue, we first decide that the issue was properly preserved for appeal in spite of defendants’ failure to move for a new trial. Such procedure is not required. Bunda v Hardwick, 376 Mich 640, 672; 138 NW2d 305 (1965), GCR 1963, 517.1.

At issue here is the following finding of the trial court:

"Even though there is a conflict of testimony as to what the property was worth (and admittedly, a foreclosure sale is not ideal as far as it tends to obtain optimum results pricewise as an open sale on the market) the Court is of the opinion that in light of all the testimony, weighing the testimony of the experts, the bid-in price was a reasonable price; the Court has ruled earlier as to the interest rate to be maintained at the eight and three quarters per cent interest, not ballooning to the ten per cent interest indicated in the contract.”

Although it would have been preferable for the trial court to frame its decision in language borrowed from MCL 600.3280; MSA 27A.3280, i.e., whether "* * * the property sold was fairly worth the amount of the debt secured by it at the time and place of sale or that the amount bid was substantially less than its true value”, its failure to do so does not obscure its finding. The court referred to the expert testimony offered by both parties as to the market value of the property and held that, based upon that evidence, the bid-in price was reasonable. The fact that the court recognized that foreclosure sales do not generally result in the seller obtaining the highest possible price for the property does not negate the fact that its decision was based on the testimony of experts concerning the market value of the properties. A finding that the offer was "reasonable” clearly indicates that the amount of the bid was not substantially less than the true value of the property, which is all that the statute requires.

Affirmed in part, reversed in part.


source: Caselaw Access Project

license: Public Domain

text:
    FARM BUREAU MUTUAL INSURANCE COMPANY v SEARS, ROEBUCK AND COMPANY
    Docket No. 45022.
    Submitted May 6, 1980, at Lansing.
    Decided September 2, 1980.
    A fire destroyed a home and its contents owned by Joanne P. Hill. The fire was allegedly caused by negligent repair of the furnace by Sears, Roebuck and Company. Farm Bureau Mutual Insurance Company, which insured a portion of the property, brought an action against Sears to recover the amount of its loss. Hill intervened as a plaintiff to recover damages for the destroyed property which was not covered by the insurance. The jury returned a verdict in favor of Hill but awarded no compensation to Farm Bureau. Farm Bureau made a motion for judgment notwithstanding the verdict or, in the alternative, for a new trial because of the inconsistent verdicts. Hill moved for additur, and Sears moved for a new trial in the event that a new trial was granted as to Farm Bureau. The Livingston Circuit Court, Paul R. Mahinske, J., granted Farm Bureau’s motion for judgment notwithstanding the verdict and denied the other motions. Sears appeals. Held:

    1. The failure of Sears to object to the motion for judgment notwithstanding the verdict and Farm Bureau’s failure to object to the jury verdict does not preclude appellate review of the propriety of the grant of the judgment notwithstanding the verdict.
    2. The proper remedy for the inconsistent verdicts was for the trial court to have further instructed the jury and the jury to have further deliberated. Grant of the motion for judgment notwithstanding the verdict was error.
    Reversed and remanded for a new trial.
    References for Points in Headnotes
    [1] 5 Am Jur 2d, Appeal and Error § 632.
    [2, 3] 76 Am Jur 2d, Trial § 1214.
    [3] 46 Am Jur 2d, Judgments §§ 113-118.
    [4] 75 Am Jur 2d. §§ 340 et seq., 491 et seq.

    Practice and procedure with respect to motions for judgment notwithstanding or in default of verdict under Federal Civil Procedure Rule 50(b) or like state provision. 69 ALR2d 449.

      1. Judgments — Judgment Notwithstanding the Verdict — Appeal — Court Rules.
    A party who has had a verdict in their favor set aside on a motion for judgment notwithstanding the verdict is not required to object to the motion in order to preserve for review the question of the propriety of the judgment notwithstanding the verdict (GCR 1963, 515.3[2], 527.7).
    2. Jury — Verdicts — Inconsistent Verdicts.
    The obligation to remedy an inconsistent verdict lies with the trial court with or without objection of counsel for the parties; the proper remedy is further instruction and jury deliberation.
    3. Judgments — Judgment Notwithstanding the Verdict — Directed Verdict.
    A judgment notwithstanding the verdict is not the appropriate remedy for inconsistent verdicts; it is proper only where the moving party would have been entitled to a directed verdict.
    4. Jury — Verdicts — Directed Verdict.
    The test for determination of whether a directed verdict shall be granted is whether or not evidence was offered upon which reasonable minds could differ; if so, a directed verdict should not be granted.

      Denenberg, Tuffley, Thorpe, Bocan & Patrick (by John C. Patrick, Jr., and llene Gordon), for plaintiffs.

      Foster, Swift, Collins & Coey (by Philip T. Carter and James E. Lozier), for defendant.
    Before: Cynar, P.J., and M. J. Kelly and T. Gillespie, JJ.

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

   M. J. Kelly, J.

Plaintiff Joanne Hill’s farm house and personal property were destroyed by a fire allegedly caused by defendant Sears’ negligent repair of the Hill furnace. The property was insured in part by plaintiff Farm Bureau Mutual Insurance Company which, as subrogee of Hill, initiated an action against Sears to recover the $26,850 it paid out for the fire loss. Plaintiff Hill filed an intervening complaint against Sears to recover uninsured contents damages incurred in excess of the amount of her insurance coverage with Farm Bureau. The jury returned a verdict in favor of plaintiff Hill in the amount of $15,500, but awarded no compensation to Farm Bureau, finding no cause as to its claim, although entirely derivative. Following entry of judgment pursuant to the jury verdict, Farm Bureau made a motion for judgment n.o.v. or, in the alternative, for a new trial due to the inconsistent verdicts. Plaintiff Hill made a motion for additur. Defendant Sears likewise moved for a new trial in the event that a new trial was granted as to Farm Bureau. The trial court granted Farm Bureau’s motion for judgment n.o.v. and denied all other motions. A judgment was entered accordingly and defendant appeals as of right.

Defendant claims that the trial court erred in granting plaintiff Farm Bureau’s motion, for judgment n.o.v. and denying its motion for new trial. Before addressing the merits of the issue we must first determine whether Sears properly preserved for appeal the question regarding the judgment n.o.v. due to its failure to object at the hearing below. GCR 1963, 515.3(2) provides:

"The party whose verdict has been set aside on motion for judgment notwithstanding the verdict may, not later than 10 days after entry of judgment, serve and file a motion for a new trial, which shall be granted, or denied, conditionally or otherwise, and if conditionally, with the consequences set forth in paragraph (1) of this section.”

We find no authority in the above court rule or elsewhere in this jurisdiction requiring that such party also object to the entry of judgment n.o.v. Cf. GCR 1963, 527.7. Moreover, when the jury returns inconsistent verdicts the proper corrective procedure at trial is further instruction and jury deliberation:

"It requires no citation of authorities to demonstrate that, when a jury returns to the courtroom and tenders an imperfect, irregular, or defective verdict, it is the duty of the court to further appropriately instruct them, and direct their retirement. Jurors are not learned in the law, and very frequently misapprehend the scope of their powers and duties. Such misapprehensions, when they find expression in improper verdicts, should at once be corrected by the trial judge, and, if possible, a proper verdict secured.” McCormick v Hawkins, 169 Mich 641, 649; 135 NW 1066 (1912). See Sadlowski v Meeron, 240 Mich 306, 313; 215 NW 422 (1927), aff'd 243 Mich 602 (1928).

The above cited cases indicate that the obligation to remedy an inconsistent verdict situation lies with the court, with or without objection of counsel. We therefore conclude that plaintiff Farm Bureau’s failure to object to the jury verdict and defendant’s failure to object at the hearing on the motion for judgment n.o.v. do not preclude review.

On appeal, defendant contends that plaintiff Farm Bureau’s failure to move for directed verdict at the close of proofs prevents the subsequent entry of judgment n.o.v. GCR 1963, 515.2 states, in pertinent part:

"Motion for Judgment Notwithstanding the Verdict. Whenever a motion for a directed verdict made at the close of all the evidence is denied or for any reason is not granted, the moving party may move not later than 20 days after the entry of judgment to have the verdict and any judgment entered thereon set aside and to have judgment entered in accordance with his motion for a directed verdict; * * * If a verdict was returned the court may allow the judgment to stand or may reopen the judgment and either order a new trial or direct the entry of judgment as if the requested verdict had been directed. If no verdict was returned the court may direct the entry of judgment as if the requested verdict had been directed or may order a new trial.”

Honigman & Hawkins explains the import of the above rule as follows:

"Under the rule as amended, the trial court is required to set aside a verdict and enter judgment notwithstanding the verdict only if a motion for directed verdict was previously made and not granted. In the absence of a motion for directed verdict, only a new trial can be granted in response to a successful post-judgment attack upon the verdict. However, it should be noted that prior to adoption of the 1963 rules, when a motion for a directed verdict was similarly a prerequisite to a motion for judgment notwithstanding the verdict, the Supreme Court had at times exercised its discretion in granting judgment contrary to the verdict, in the absence of the prerequisite motion for a directed verdict, where it appeared that no different result could be expected upon a new trial. See Antisdel v Canfield, 1899, 119 Mich 229, 77 NW 944; Wadhams v Western Assur Co, 1898, 117 Mich 514, 76 NW 6; and Flagg v Chicago, etc Ry Co, 1893, 96 Mich 30, 55 NW 444.” 2 Honigman & Hawkins, Michigan Court Rules Annotated (1979 pocket part), at 148.

However, in the instant case neither the rule nor its exception are applicable. Judgment notwithstanding the verdict is not the appropriate remedy for inconsistent verdicts. Judgment notwithstanding the verdict is proper only when the movant would have been entitled to a directed verdict. Hes v Haviland Products Co, 6 Mich App 163; 148 NW2d 509 (1967). The proper test for determining whether a directed verdict should be granted is whether evidence was offered upon which reasonable minds could differ. Light v Schmidt, 84 Mich App 51; 269 NW2d 304 (1978). Defendant Sears’ liability to plaintiff Hill was clearly a question for jury determination and no motion for directed verdict or subsequent motion for judgment notwithstanding the verdict was made with respect to the negligence issue.

Under the facts of the present case we find the Supreme Court’s decision in Harrington v Velat, 395 Mich 359; 235 NW2d 357 (1975), directly on point. In Harrington, supra, plaintiff sued defendants Detroit police officers and the City of Detroit for assault and battery, false imprisonment, and violation of civil rights arising out of plaintiff’s arrest. A jury verdict was rendered against defendant City of Detroit but in favor of defendant police officers. Recognizing that defendant City of Detroit’s liability was derivative of defendant police officers, the trial court denied plaintiff’s motion for a new trial and "corrected” the verdict to read no cause of action against the City of Detroit. The Supreme Court reversed the Court of Appeals affirmance of the trial court’s grant of these motions and remanded the case back to the trial court for a new trial. In doing so, it held:

"The trial judge in a civil case can correct a verdict which is defective or erroneous as to a mere matter of form not affecting the merits or rights of the parties so as to give effect to what the jury unmistakably found. 76 Am Jur 2d, Trial, § 1208.
’’However, the general rule is that where a verdict in a civil case is inconsistent and contradictory, it will be set aside and a new trial granted.
" 'Ordinarily, a verdict may and should be set aside and a new trial granted where it is self-contradictory, inconsistent, or incongruous, and such relief should, as a rule, be granted where more than one verdict are [sic] returned in the same action and they are inconsistent and irreconcilable.’ 66 CJS, New Trial, § 66, pp 197-198.
"Accord, Bias v Ausbury, 369 Mich 378; 120 NW2d 233 (1963); 58 Am Jur 2d, New Trial, § 129, pp 335-336. See Bartholomew v Walsh, 191 Mich 252, 261-262; 157 NW 575 (1916).” 395 Mich 359, 360. (Emphasis supplied.)

The trial court erred in granting plaintiff Farm Bureau’s motion for judgment n.o.v. The proper remedy to correct the defective verdict was via further instruction and jury deliberation. The record is silent as to why this was not considered at the time. The verdict itself was not phrased in terms of no cause. It was delivered by the foreman as follows:

"JUROR #18: We, the jury, find in favor of the Plaintiff, Mrs. Hill, award her compensation in the amount of $15,500. In the case of the Plaintiff, Farm Bureau Mutual Insurance Company, we award no compensation.”

In fact, when the jury was polled the court phrased it thusly:

"THE COURT: * * * Is this or is not this your verdict? You can answer yes or no. That you find for the Plaintiff Hill in the amount of $15,500 and you find for the Plaintiff Farm Bureau Mutual Insurance Company no compensation.”

After the jury was polled and their verdict found to be unanimous the court thanked them and discharged them. By this time it was very late on a Friday evening, in fact after regular court hours, but the inconsistency is so blatant that it seems to us that the jury might have had a ready understanding of further instructions and corrected the inconsistency. Unfortunately only surmise is left at this point.

Reversed and remanded for new trial. No costs.


author: G. R. Corsiglia, J.

text:
    WINRICK v CITY OF WARREN
    Docket No. 45562.
    Submitted June 5, 1980, at Lansing.
    Decided September 2, 1980.
    Harry Winrick, plaintiff, was precluded from consideration as an applicant for the positions of Janitor-Laborer and Equipment Operator I with the City of Warren because the plaintiffs father worked in the sanitation division of the Department of Public Works. The Warren City Charter provides that no two persons who are within the second degree of consanguinity or affinity can be employed within the same department of the city. The plaintiff brought suit in Macomb Circuit Court. Upon a motion for partial summary judgment made by the plaintiff, Raymond R. Cashen, J., ruled that the above charter provision was a denial of plaintiffs equal protection, pursuant to the Const 1963, art 1, § 2; US Const, Am XIV. A trial was then held on the issue of damages, and at its conclusion the court entered a judgment in accordance with his earlier opinion. The defendants City of Warren and the Civil Service Commission of the City of Warren appeal. Held:

    The right to consideration for employment is not a "fundamental” right as defined by the Supreme Court which would require a compelling state interest and subject an antinepotism provision of a city charter to strict scrutiny, nor is this provision in an “experimental” stage and subject to the traditional and least stringent "rational basis” test. Constitutional analysis of the provision requires middle-level scrutiny. The charter provision of the City of Warren has a fair and substantial relationship to a laudable legislative purpose. It is limited in scope to avoid hiring favoritism by appointing officials and department heads and to avoid intradepartmental cronyism.
    Reversed and remanded with instructions.
    1. Constitutional Law — Municipal Corporations — Charter Provision — Middle Level Scrutiny — Fundamental Rights — Employment.
    The right to consideration for employment is not a "fundamental” right as defined by the Supreme Court which would require a compelling state interest and subject an antinepotism provision of a city charter to strict scrutiny; a city charter antinepotism provision which is not in an "experimental” stage requires middle-level scrutiny.

      References for Points in Headnotes
    [1] 16A Am Jur 2d, Constitutional Law § 563.
    [2] 56 Am Jur 2d, Municipal Corporations, Counties, and Other Political Subdivisions § 398 et seq.

      2. Municipal Corporations — Charter Provisions — Words and Phrases — Strict Construction.
    Strict construction of the language of a city charter provision will not be made when to do so would defeat the purpose of another provision dealing with the same subject area.

      Dee Edwards, for plaintiff.

      W. Thomas Marrocco, Jr., City Attorney, and David L. Dalenberg, Assistant City Attorney, for defendant.
    Before: Danhof, C.J., and M. J. Kelly and G. R. Corsiglia, JJ.

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

   G. R. Corsiglia, J.

The defendants, City of Warren and the Civil Service Commission of the City of Warren, appeal from a judgment holding the antinepotism provision of the charter of the City of Warren unconstitutional and awarding the plaintiff, Harry Winrick, $5,000 in damages.

The case was tried to the bench on the issue of damages following a decision by the trial judge that the charter provision was unconstitutional as a matter of law. The record discloses that the plaintiff was precluded from consideration as an applicant for the positions of Janitor-Laborer and Equipment Operator I, when the top three candidates were taken from the eligibility lists to be interviewed for positions open in the Department of Public Works, because the plaintiffs father worked in the sanitation division of the department.

The Warren City Charter provision states in relevant part:

"No two or more persons who are within the second degree of consanguinity or affinity shall be employed within the same department of the city.” Warren Charter, § 7.27.

The City of Warren is divided into ten departments and the record indicates that the plaintiff was eligible, if qualified, for employment in any other city department in which there was an opening.

The circuit judge ruled that the charter provision was a denial of equal protection, Const 1963, art 1, § 2; US Const, Am XIV, upon a motion for partial summary judgment made by the plaintiff. A trial was then held on the issue of damages, and at its conclusion the court entered a judgment in accordance with his earlier opinion.

The Warren City Charter provision dates back to the 1950’s when the City of Warren was first incorporated. The trial judge held it unconstitutional based upon a determination that the legislative objective which would outweigh the interest of the individual was no longer viable. He noted the growth of the city, the growth in the number of its employees and the growth of the Civil Service Commission. The trial court stated:

"The public concern with interdepartmental [sic] favoritism has ceased to exist due to the passage of time and natural changes which have accompanied the municipal growth.”

He ruled that the primary objective of the charter provision, to prevent the occurrence of a situation wherein a relative might show favoritism to a fellow related employee within the same department, no longer outweighed its impact upon the rights of individuals. We disagree;

An initial analysis must be made of the test to be applied when considering whether a legislative classification conforms with the stricture of equal protection. The trial court correctly articulated the test to be applied in this case.

A constitutional analysis of the Warren antinepotism charter provision requires a middle-level scrutiny. Hampton v Mow Sun Wong, 426 US 88; 48 L Ed 2d 495; 96 S Ct 1895 (1976). The right to consideration for employment is not a "fundamental” right as defined by the Supreme Court which would require a compelling state interest and subject this charter provision to strict scrutiny. Nor is this provision in an "experimental” stage and subject to the traditional and least stringent "rational basis” test.

Our analysis that this antinepotism charter provision falls in the middle area of the equal protection continuum is supported by the plurality opinion in Manistee Bank & Trust Co v McGowan, 394 Mich 655; 232 NW2d 636 (1975), by Justice Levin, wherein he acknowledged that value judgments are inherent in any equal protection analysis. He stated:

"So, too, is the choice of test a matter of judgment. In my judgment, at least where the challenged statute carves out a discrete exception to a general rule and the statutory exception is no longer experimental, the substantial-relation-to-the-object test should be applied.” Id., 671; 232 NW2d 642.

The instant case is distinguishable from the decision in Bretz v City of Center Line, 88 Mich App 451; 276 NW2d 617 (1979). In Bretz the antinepotism ordinance was declared unconstitutional as overbroad. However, Judge Bashara, writing for the panel, specifically distinguished the Center Line ordinance which proscribed employment throughout the city from a more narrowly drafted provision. The Court stated:

"The broad terms of the ordinance can lead us to no other conclusion than that its sweep goes far beyond the legitimate objectives sought to be reached. The cases cited by appellant in support of its argument involve, as appellee points out, statutes limited to the disqualification of relatives of appointing officials or departments heads.” Id., 454; 276 NW2d 618.

The charter provision of the City of Warren challenged by the plaintiff in this case is more precisely drafted and has a fair and substantial relationship to a laudable legislative purpose. It is limited in scope to avoid hiring favoritism by appointing officials and department heads, and to avoid intradepartmental cronyism. As drafted, it does not ban the plaintiff from employment in the other nine city departments, only the department in which his father is a long-time employee.

While the Civil Service Commission provides some protection against favoritism in promotions, it cannot effectively achieve the purpose of the antinepotism provision. The Civil Service provision, read in conjunction with the charter provision, provides additional criteria which do not contradict the charter provision regarding antinepotism. Strict construction of the language of a provision will not be made when to do so would defeat the purpose of another provision dealing with the same subject area. See Detroit v Michi gan Bell Telephone Co, 374 Mich 543; 132 NW2d 660 (1965).

Personnel move up. to higher positions on the municipal corporate organization chart. A relative and coworker could become, quite legitimately under Civil Service provisions, a supervisory employee over a period of time. In addition, the day-to-day workings of a city department cannot be effectively policed by means of general Civil Service Commission rules, beneficial though they may be. The Warren Charter provision is an effective and limited response to a perceived problem.

Since we have determined that the intradepartmental antinepotism provision is constitutionally permissible, we do not reach the issues relating to damages. The ruling by the trial judge on the constitutionality of the provision effectively precluded consideration of the plaintiff’s other allegations relating to unconstitutional application of the provision and these matters must be determined by the trial court in further proceedings.

Reversed and remanded for proceedings consistent with this opinion; no costs, a public question being involved.


author: T. M. Burns, P.J.

text:
    UPTHEGROVE v MYERS
    Docket No. 46475.
    Submitted May 12, 1980, at Detroit.
    Decided September 2, 1980.
    Leave to appeal applied for.
    Bruce Eichner rented a guest room at the Troy Hilton Inn, owned by defendant Troy Hilton Operating Company, for the purpose of having a party. Many young people were invited and expected to bring their own alcoholic beverages. Twenty to 30 persons attended, including defendant James E. Myers, who consumed at least 12 cans of beer at the party. No alcoholic beverages were purchased from the Troy Hilton; however, employees did deliver ice and glasses to the party. At about 3 a.m. the hotel employees asked the participants to leave. James Myers got in a car owned by Donald W. Myers, drove approximately four miles and struck the rear of an automobile, killing Floyd B. Upthegrove. James W. Upthegrove, administrator of Floyd Upthegrove’s estate, and Audrey Upthegrove, decedent’s mother, brought suit against James Myers, Donald W. Myers and the Troy Hilton Operating Company in the Oakland Circuit Court, alleging, among other things, a cause of action against Troy Hilton under the dramshop act and a cause of action against Troy Hilton in common-law negligence for failure to police the premises and prevent disorderly conditions under its control. The court, Hilda R. Gage, J., granted partial summary judgment for Troy Hilton Operating Company on the common-law negligence claim, holding that it had no duty to supervise and that any recovery for injuries caused by intoxicated persons was exclusively statutory. Plaintiffs appeal. Held:

    1. There is a common-law right of recovery for injuries caused by a breach of duty owed by an innkeeper.
    2. The Troy Hilton Operating Company owed no duty to such a remote person as the decedent.
    Affirmed.
    References for Points in Headnotes
    [1] 45 Am Jur 2d, Intoxicating Liquors §§ 557, 561.
    [2] 45 Am Jur 2d, Intoxicating Liquors § 557.
    Liability of innkeeper, restaurateur, or tavern keeper for injury occurring on or about premises to guest or patron by person other than proprietor or his servant. 70 ALR2d 628.
    [3] 45 Am Jur 2d, Intoxicating Liquors § 578.

      1. Intoxicating Liquors — Civil Liability — Common-Law Duty — Dramshop Act.
    The dramshop act does not affect the common-law duty of a liquor establishment to maintain a safe place of business for its customers.
    2. Innkeepers — Common-Law Duty.
    An innkeeper has a duty to its guests to exercise ordinary care and prudence to keep its premises reasonably safe; that same duty extends to guests of guests.
    3. Innkeepers — Common-Law Duty — Intoxicating Liquors.
    A hotel owes no duty of supervision to a party injured four miles from the hotel by a hotel guest’s visitor who became intoxicated during the visit.

      Bebout, Potere, Cox, Hughes & Cadieux, for plaintiffs.

      Seavitt, Westcott, Stowe, Magnuson & Beeby (by Thomas L. Misuraca), for defendant Troy Hilton Operating Company.
    Before: T. M. Burns, P.J., and R. M. Maher and M. E. Clements, JJ.

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

   T. M. Burns, P.J.

Plaintiffs appeal as of right a July 17, 1979, lower court order granting defendant Troy Hilton’s motion for partial summary judgment.

On February 8, 1975, Bruce Eichner, who is not a party in this action, rented a guest room at the Troy Hilton Inn for the purpose of conducting a party. Several young persons were invited and all were expected to bring their own alcoholic beverages. Twenty to 30 young persons attended, including defendant James Edward Myers, who consumed at least 12 cans of beer.

No alcoholic beverages were purchased from the Troy Hilton. Hotel employees did deliver ice and glasses to the room when the party was in full swing. At approximately 3 a.m., hotel employees asked most of the participants to leave. Defendant James Myers got into his car, drove approximately four miles, then struck the rear of Floyd B. Upthegrove’s car, which was stopped at a red light. Upthegrove died almost immediately.

Depositions of Troy Hilton employees indicate the hotel had had some problems with young persons renting rooms for parties. Desk clerks were instructed to try to discourage young people from renting rooms for parties. Hotel security officials stated that the Hilton’s policy was to break up such parties when they became too loud.

Plaintiffs alleged that defenant Troy Hilton negligently failed to police its premises or otherwise prevent disorderly conditions by those under its control. Defendant Troy Hilton filed a motion for partial summary judgment which was granted after a hearing. The trial court offered two grounds for granting the motion: first, the innkeeper had no duty to supervise; and second, any recovery for injuries caused by intoxicated persons was exclusively statutory.

The trial court erred in holding that recovery was exclusively statutory. Michigan’s dramshop act provides a civil cause of action against those who unlawfully furnish intoxicating liquor. That act does not affect the common-law duty of a liquor establishment to maintain a safe place of business for its customers. Manuel v Weitzman, 386 Mich 157, 163-164; 191 NW2d 474 (1971).

The trial court properly recognized, however, that defendant Troy Hilton owed no duty to plaintiff to supervise the activities of its visitors’ guests. The hotel was the scene of a party, which took place without the hotel’s permission. When hotel employees observed the party under way, they did not halt it immediately, but allowed it to proceed until 3 a.m.

Plaintiffs’ decedent was not attending the party, nor was he in the immediate vicinity of the hotel.

The threshold question in this case is whether the hotel had a duty or obligation recognized by law that required it to conform to a certain standard of conduct for the protection of others against unreasonable risks. Unless defendant owed such a duty to plaintiff, the negligence analysis can proceed no further. Cook v Bennett, 94 Mich App 93, 98; 288 NW2d 609 (1979).

An innkeeper has a duty to protect guests from injury. The innkeeper must exercise ordinary care and prudence to keep his premises reasonably safe for business invitees. That same duty is extened to guests of guests, who have a right to expect the premises to be reasonably safe. Keech v Clements, 303 Mich 69, 73; 5 NW2d 570 (1942).

Although no Michigan cases discuss the liability of a hotel when passersby are injured, in other jurisdictions the duty to keep the premises reasonably safe has been extended to those passersby in the immediate vicinity of the hotel. Connolly v The Nicollet Hotel, 254 Minn 373; 95 NW2d 657 (1959), Gore v The Whitmore Hotel Co, 229 Mo App 910; 83 SW2d 114 (1935).

Where, however, a hotel employee took some action to control its guest’s behavior and no incident arose to indicate further action was required, the hotel was not held liable for injuries sustained when a guest threw a soft drink bottle from a window and injured a passerby. Holly v Meyers Hotel & Tavern, Inc, 9 NJ 493, 496-497; 89 A2d 6 (1952). See also Bruner v Seelbach Hotel Co, 133 Ky 41; 117 SW 373 (1909).

These non-Michigan cases recognize a duty to protect passersby after a relationship has arisen between the passerby and the hotel due to the proximity of the passerby. That proximity gives the passerby the right to rely on the hotel’s reasonably safe condition.

Plaintiffs in the case at bar must, however, rely on some other duty. Plaintiff’s decedent was injured four miles from the hotel after the guest’s visitor had left the hotel premises. The situation is factually similar to that in Wiener v Gamma Phi Chapter of Alpha Tau Omega Fraternity, 258 Or 632; 485 P2d 18 (1971), where a duty to supervise was alleged when owners of a tree farm and motel rented space to a fraternity for a party. Plaintiff had attended the party and was a passenger in a fraternity member’s car when she was injured in an accident that occurred after leaving the party. The Oregon Supreme Court rejected a claim that the owners of the farm could be held liable for failure to supervise the party or for failure to control the host’s exercise of judgment.

In the case at bar, no duty of the hotel can be found to the plaintiff to supervise the activities of the hotel guest’s visitor after he left the premises. The hotel had fulfilled any duty it had to passersby to keep the premises reasonably safe. It has no further duty.

Affirmed.


author: Per Curiam. Cynar, J.

text:
    PEOPLE v STEIN
    Docket No. 78-2425.
    Submitted June 16, 1980, at Detroit.
    Decided September 2, 1980.
    Leave to appeal applied for.
    Lawrence R. Stein was charged with armed robbery but was convicted of unarmed robbery and the maximum sentence was imposed. At the time of sentencing, the prosecution filed a supplemental information charging defendant as an habitual offender. Defendant was convicted of being a fourth felony offender and was sentenced to prison, Detroit Recorder’s Court, Joseph A. Gillis, J. His sentence for the unarmed robbery conviction was vacated. He appeals, alleging the trial court erred by allowing the prosecution to file a supplemental information after he had been convicted of, and sentenced on, the charge of unarmed robbery and that he was denied effective assistance of counsel. Held:

    1. The trial court erred in allowing the prosecution to file the supplemental information charging defendant as an habitual offender post-conviction and post-sentencing since the defendant had a prior felony record in the same jurisdiction in which the armed robbery charge was brought and the prosecution is charged with knowledge of such record. Accordingly, the habitual offender charge should have been brought simultaneously with the charge for the principal felony.
    2. Defendant had not been charged as an habitual offender at the time the original sentence was imposed and, thus, a sentence of a definite term of imprisonment was improper. Rather, an indeterminate sentence should have been imposed in which the minimum term did not exceed two-thirds of the maximum.

      References for Points in Headnotes
    [1, 3, 6] 39 Am Jur 2d, Habitual Criminals and Subsequent Offenders §§ 17.5, 19, 20.
    [2] 20 Am Jur 2d, Courts § 85.
    [4] 21 Am Jur 2d, Criminal Law §§ 540, 592.
    Validity, under indeterminate sentence law, of sentence fixing identical minimum and maximum terms of imprisonment. 29 ALR2d 1344.
    [5] 21 Am Jur 2d, Criminal Law § 315.
    Incompetency of counsel chosen by accused as affecting validity of conviction. 74 ALR2d 1390.

      3. The record reveals that defendant’s counsel performed at least as well as a lawyer with ordinary training and skill in the criminal law and conscientiously protected defendant’s interests, undeflected by conflicting considerations.
    4. Defendant’s other contentions were rendered moot by this decision.
    Habitual offender conviction vacated and unarmed robbery conviction reinstated, the sentence amended to include a minimum term.
    Cynar, J., concurred, but would reverse the habitual offender conviction solely on the basis that since the prosecutor was necessarily in possession of reliable information regarding defendant’s prior felony record in the jurisdiction in which the principal felony charge was brought, his post-trial filing of an habitual offender information was not prompt or timely.
    Opinion of the Court
    1. Criminal Law — Habitual Offenders — Post-Conviction Filing of Supplemental Information.
    Allowing the prosecution to file a supplemental information charging a defendant with being an habitual offender after the defendant has been convicted and sentenced on the principal charge constitutes reversible error.
    2. Criminal Law — Habitual Offenders — Filing of Supplemental Information Rule — Application.
    The rule which provides that a prosecutor may not delay in filing a supplemental information charging a defendant as an habitual offender where the prosecutor is aware of the defendant’s earlier felony convictions should be applied to all cases which were pending on appeal at the date of its annunciation as well as to subsequent cases.
    3. Criminal Law — Prosecutors — Habitual Offender Charges — Prior Felonies.
    Prosecutors are presumed to know that a defendant has a prior felony record where such record is in the jurisdiction in which the defendant is being charged, and, thus, habitual offender charges should be made simultaneously with charges on the principal felony.
    4. Criminal Law — Indeterminate Sentences — Statutes.
    A court, imposing sentence on a defendant convicted for the first time for the commission of a felony or who has had prior felony convictions but was not charged as an habitual offender, shall not fix a definite term of imprisonment but shall fix a sentence in which the minimum term does not exceed two-thirds of the maximum term (MCL 769.8; MSA 28.1080).
    5. Criminal Law — Defense Counsel — Standard of Performance.
    Defense counsel must perform at least as well as a lawyer with ordinary training and skill in the criminal law and must conscientiously protect his client’s interests, undeflected by conflicting considerations.
    Concurrence by Cynar, J.
    6. Criminal Law — Habitual Offenders — Post-Conviction Filing of Supplemental Information.

      An habitual offender conviction should be reversed where a prosecutor is necessarily in possession of reliable information regarding a defendant’s prior felony record in the jurisdiction in which the principal felony charge was brought and ñles a supplemental information charging the defendant as an habitual offender post-trial, on the basis that the Sling was not prompt or timely.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cabalan, Prosecuting Attorney, Edward Reilly Wilson, Principal Attorney, Appeals, and Andrea L. Solak, Assistant Prosecuting Attorney, for the people.

      Barbara R. Levine and Peter J. Van Hoek, Assistant State Appellate Defenders, for defendant on appeal.
    Before: N. J. Kaufman, P.J., and Cynar and J. E. Townsend, JJ.

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

   Per Curiam.

Defendant was charged with, and tried for, armed robbery, MCL 750.529; MSA 28.797, but was convicted of unarmed robbery, MCL 750.530; MSA 28.798, in a jury trial in Detroit Recorder’s Court. Defendant was sentenced on July 20, 1977, for a flat period of 15 years.

At the time of sentencing, the prosecution filed a supplemental information charging defendant with being an habitual offender in violation of MCL 769.13; MSA 28.1085. At a jury trial on this charge, defendant was convicted of being a fourth felony offender and was sentenced, on March 15, 1978, to 25 to 50 years imprisonment on this conviction. At the same time, the 15-year sentence imposed for the unarmed robbery conviction was vacated in accordance with MCL 769.13; MSA 28.1085. The fourth offender conviction is the subject of defendant’s appeal.

On appeal, defendant raises seven issues, the first of which, we believe, is dispositive of almost the entire matter. Defendant contends that the trial court committed reversible error by allowing the prosecution to file a supplemental information after defendant had been convicted and sentenced on the unarmed robbery charge. We agree.

Defendant did not object to the late filing at any time before trial. The controlling case on this matter, People v Fountain, 407 Mich 96; 282 NW2d 168 (1979), was decided after defendant’s trial on the habitual offender charge. However, since objections were made during the trial challenging the constitutionality and legality of the statute as it was then being interpreted, we believe that these objections were sufficient to preserve this issue for appeal.

Fountain held that a prosecutor may not delay in filing a supplemental information charging a defendant as an habitual offender where the prosecutor is aware of the earlier felony convictions. If Fountain is given retroactive application, error was clearly committed by allowing an untimely filing of the supplemental information.

The Michigan Supreme Court has given conflicting signals as to whether the Fountain decision is to be given retroactive application. While Fountain did not speak on this issue, its rule was applied in People v Morris, 407 Mich 885 (1979), where the defendant’s habitual offender sentence was vacated and the court below was ordered to reinstate the original sentence. Subsequently, in People v Devine, 407 Mich 904; 284 NW2d 342 (1979) , the Court issued a memorandum decision declaring that no opinion was intimated on the retroactivity of Fountain, while simultaneously applying the rule of Fountain to prevent resentencing of a defendant based on an habitual offender conviction. Finally, in People v Ronald Brown, 407 Mich 913 (1979), the Court remanded the case to the Court of Appeals for briefing and argument on the matter of Fountain’s retroactivity. Pending further action in the Brown case, it can only be inferred that the issue is still open.

Whether a new interpretation of law should be applied retroactively or only prospectively has been discussed in detail by the courts in numerous cases. See, e.g., Linkletter v Walker, 381 US 618; 85 S Ct 1731; 14 L Ed 2d 601 (1965). In Linkletter, as in People v Gay, 407 Mich 681; 289 NW2d 651 (1980), People v Hampton, 384 Mich 669; 187 NW2d 404 (1971), and People v Markham, 397 Mich 530; 245 NW2d 41 (1976), a three-pronged test was proposed to govern this question. This tritiered analysis calls for an examination of "(1) the purpose of the new rule; (2) the general reliance on the old rule; and (3) the effect on the administration of justice”. Hampton, supra, 674.

Initially, we note that the Supreme Court has previously expressed approval of the prompt filing of charges against a defendant as an habitual offender when the prosecutor has knowledge of the defendant’s prior felony record. People v Hatt, 384 Mich 302; 181 NW2d 912 (1970). However, this procedure was not mandatory until Fountain.

There are a variety of ways that the procedural mandate of Fountain may be given effect. See Placek v Sterling Heights, 405 Mich 638, 662; 275 NW2d 511 (1979). For example, a new rule of law may be made applicable to future cases and the case at bar. In People v Jenkins, 395 Mich 440; 236 NW2d 503 (1975), the Court limited the application of the new rule enunciated therein to the case at bar and all cases tried after an arbitrarily selected date. Very recently, in Murray v Beyer Memorial Hospital, 409 Mich 217; 293 NW2d 341 (1980), the Court stated that it doesn’t alter established rules lightly. Then acknowledging some unfairness whenever a new rule is announced, the Court stated that the importance of the result outweighed any unfairness and applied the rule announced therein to all cases pending on appeal where the issue had been properly raised. See also Placek, supra, 667.

After balancing these considerations, we believe that the rule of Fountain should be applied to future cases and to all cases which were pending on appeal at the date of the Fountain decision. The present case should, therefore, be judged by the requirements of Fountain. See People v Reese, 97 Mich App 785; 296 NW2d 172 (1980).

In Fountain, the defendant was charged as a fourth offender after he filed an appeal on the underlying conviction. In People v Jones, a case decided with Fountain, the defendant was charged as a third offender before sentencing, but after conviction on the principal charge. In both cases, the filings fell short of the "promptness” mandate, and the habitual offender sentences were vacated. Because each defendant had a prior felony record in the jurisdiction in which he was being charged, the Court presumed that the prosecutors had knowledge of these felony records. Consequently, the Court held that:

"The habitual offender charges should have been filed with the information which charged the last felony to provide fair notice to the accused and avoid an appearance of prosecutorial impropriety.” Fountain, supra, 99.

In the instant case, the defendant had a prior felony record in the jurisdiction in which the armed robbery charge was brought. Under Fountain, we must presume knowledge on the part of the prosecutor. The prosecutor did not, however, charge defendant as an habitual offender until after defendant was convicted of unarmed robbery. Under the circumstances of this case, we believe the only way in which the prosecutor could have fulfilled the mandate of Fountain would have been to charge the defendant as an habitual offender at the same time as the defendant was charged on the principal felony. We, therefore, vacate defendant’s habitual offender sentence and alter the sentence on defendant’s unarmed robbery conviction, MCL 750.530; MSA 28.798.

We note that defendant’s sentence on the unarmed robbery conviction was a flat 15 years. Although the issue was not raised by defendant, we find, sua sponte, that this was an improper sentence. MCL 769.8; MSA 28.1080 provides, in relevant part, that:

"When a person is convicted for the first time for the commission of a felony, * * * the court imposing sentence shall not fix a definite term of imprisonment, but shall fix a minimum term * *

This statute was interpreted in People v Tanner, 387 Mich 683; 199 NW2d 202 (1972), in which the "two-thirds rule” was established. Under this rule, indeterminate sentences had to be imposed in which the minimum did not exceed two-thirds of the maximum term. The Court later decided in Brinson v Genesee Circuit Judge, 403 Mich 676, 680-682; 272 NW2d 513 (1978), that this rule also applied to offenders who had prior felony convictions, but who were not charged as habitual offenders. The proper sentence should have been 10 to 15 years, instead of a flat 15-year sentence.

Because we have decided this case based on the mandate of Fountain, we do not find it necessary to discuss defendant’s contention that he was entitled to 20 peremptory challenges, since conviction on the habitual offender charge could have resulted in a sentence of life imprisonment. Because we are vacating the habitual offender conviction, this matter is moot. Also moot is the issue of whether defendant should have been allowed to collaterally attack his prior convictions.

It is defendant’s contention that he was denied effective assistance of counsel. Our reading of the briefs and records of the instant case, as well as certain circumstances surrounding defendant, fails to convince us that counsel did not fulfill the standards enunciated in People v Garcia, 398 Mich 250, 264; 247 NW2d 547 (1976):

" 'Defense counsel must perform at least as well as a lawyer with ordinary training and skill in the criminal law and must conscientiously protect his client’s interests, undeflected by conflicting considerations.’ ”

Defendant’s habitual offender conviction is hereby vacated, and his unarmed robbery conviction is reinstated. His sentence on the latter conviction, however, is to be 10 to 15 years imprisonment according to Brinson.

Cynar, J.

(concurring). In concurring to reverse the habitual offender conviction, I would rely solely on People v Hendrick, 398 Mich 410; 247 NW2d 840 (1976). The prosecutor filed a supplemental information at the time of sentencing for armed robbery, charging defendant with being an habitual offender in violation of MCL 769.13; MSA 28.1085. At the time of the sentencing, the defendant had a prior felony record in the jurisdiction in which the armed robbery charge was brought. Thus, the prosecutor was necessarily in possession of reliable information regarding the previous conviction prior to trial on the armed robbery charge, and his post-trial filing of an habitual offender information was not prompt or timely under Hendrick.

In all other respects I concur in both the reasoning and result of the majority opinion.


author: Per Curiam.

text:
    PEOPLE v STARGHILL
    Docket No. 45921.
    Submitted June 4, 1980, at Lansing.
    Decided September 2, 1980.
    Following a bench trial, defendant, Michael Starghill, was convicted of felonious assault in Recorder’s Court of Detroit, Robert L. Evans, J. The trial court held that felonious assault is not a .specific intent crime and that, while defendant did not intend to run the victim down with his automobile, he was guilty of felonious assault because he participated in a high risk situation which caused the victim physical jeopardy and placed him in fear. Defendant appeals, alleging that the evidence was insufficient and that felonious assault is a specific intent crime. Held:

    1. The Supreme Court decision regarding felonious assault and specific intent was released after defendant’s conviction. The Court of Appeals declined to apply it to this case. Therefore, for this case, felonious assault is simply a simple assault with a dangerous weapon. A simple criminal assault is either an attempt to commit a battery or an unlawful act which places another in reasonable apprehension of receiving an immediate battery.
    2. A finding of fact by a court sitting in a bench trial is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed. The Court of Appeals was not convinced that a mistake had been made.
    Affirmed.
    1. Appeal — Findings of Fact — Bench Trial.
    A finding of fact by a court sitting in a bench trial is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed (GCR 1963, 517.1).

      References for Points in Headnotes
    [1] 5 Am Jur 2d, Appeal and Error §§ 839-845.
    [2] 6 Am Jur 2d, Assault and Battery §2 et seq.

    [3] 20 Am Jur 2d, Courts §§ 233, 236.
    Prospective or retroactive operation of overruling decision. 10 ALR3d 1371.

      2. Assault and Battery — Words and Phrases.
    A simple criminal assault is either an attempt to commit a battery or an unlawful act which places another in reasonable apprehension of receiving an immediate battery.
    3. Assault and Battery — Felonious Assault — Specific Intent — Retroactive Application.
    The Supreme Court’s holding in People v Joeseype Johnson, 407 Mich 196; 284 NW2d 718 (1979), need not be given retroactive application in every case.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward Reilly Wilson, Principal Attorney, Appeals, and Michael Lehto, Assistant Prosecuting Attorney, for the people.

      Maxwell & Sniderman (by Brenda J. Maxwell and Charles E. Rutledge), for defendant.
    Before: Danhof, C.J., and M. J. Kelly and G. R. Corsiglia, JJ.

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

   Per Curiam.

On April 2, 1979, defendant was convicted of felonious assault, MCL 750.82; MSA 28.277, following a bench trial. The charge arose out of a confrontation between police officers and defendant near Olympia Stadium in Detroit. Defendant, leaving a parking space with the police in pursuit, drove forward into a police cruiser and then backed up directly towards a police officer who fired his weapon in self-defense. Defendant presented testimony that his transmission was worn out, causing unexpected "lunging”.

The trial court in its decision from the bench on April 2, 1979, found that defendant did not intend to run the officer down with his automobile but, nevertheless, was guilty of felonious assault because he participated in a high risk situation which caused the officer physical jeopardy, placing him in fear. In reaching this decision the court ruled that felonious assault is not a specific intent crime.

On appeal, defendant argues the evidence does not support the court’s decision and that felonious assault is a specific intent crime.

Before People v Joeseype Johnson, 407 Mich 196; 284 NW2d 718 (1979), the weight of authority in Michigan was that felonious assault was not a specific intent crime. People v Burk, 238 Mich 485, 489; 213 NW 717 (1927), People v Jordan, 51 Mich App 710, 718; 216 NW2d 71 (1974), People v Rohr, 45 Mich App 535, 536; 206 NW2d 788 (1973), People v Richard Johnson, 42 Mich App 544; 202 NW2d 340 (1972). The cases relied upon by defendant, People v Dozier, 39 Mich App 88; 197 NW2d 314 (1972), and People v Crane, 27 Mich App 201; 183 NW2d 307 (1970), were anomalous decisions rejected in People v Rohr and People v Richard Johnson, supra.

Joeseype Johnson, supra, held that there must be either an intent to injure or an intent to put the victim in reasonable fear or apprehension of immediate battery to sustain a conviction of felonious assault. 407 Mich 196, 210.

However, Joeseype Johnson was decided on October 29, 1979, after defendant’s conviction. We decline to apply it retroactively in these circumstances. See People v Hampton, 384 Mich 669; 187 NW2d 404 (1971). Therefore, we review the trial court’s decision under prior law.

Defendant also argues that the evidence does not support the court’s findings. We will not reverse unless, on the entire record, we are left with a definite and firm conviction that a mistake has been committed. GCR 1963, 517.1, People v White, 53 Mich App 51, 55; 218 NW2d 403 (1974), Tuttle v Dep’t of State Highways, 397 Mich 44; 243 NW2d 244 (1976).

Under prior law, felonious assault was considered a simple assault with the use of a dangerous weapon converting it into a felony. People v Richard Johnson, supra. A simple criminal assault is made out from either an attempt to commit a battery or an unlawful act which places another in reasonable apprehension of receiving an immediate battery. People v Sanford, 402 Mich 460, 479; 265 NW2d 1 (1978).

We are not persuaded that a mistake has been committed in the instant case. The trial court found defendant had the intent required to make out an ordinary assault. We conclude the evidence supports this finding.

Affirmed.


text:
    PEOPLE v JERRY ROBINSON
    Docket No. 50766.
    Submitted June 26, 1980, at Detroit.
    Decided September 2, 1980.
    Leave to appeal applied for.
    Defendant, Jerry Robinson, was convicted of first-degree premeditated murder in Recorder’s Court of Detroit, Elvin L. Davenport, J. The conviction was affirmed by the Court of Appeals on the prosecutor’s motion. Leave to appeal was denied by the Supreme Court, 399 Mich 818 (1977). A delayed motion for a new trial was denied by Recorder’s Court of Detroit, George W. Crockett, III, J. Application for delayed appeal was denied by the Court of Appeals, but the Supreme Court remanded the case to the Court of Appeals for consideration as on leave granted, 408 Mich 874 (1980). Defendant’s conviction arose out of the robbery and killing of William Ellis Lewis. Two others were charged and convicted of felony murder in the incident. Defendant did not arrive at the scene of the crime until after the robbery occurred and there was some question as to his involvement in the killing of Lewis and the disposal of the body. During the jury instructions, the trial judge gave a premeditated murder instruction referenced solely to defendant, a felony-murder instruction referenced solely to the two others, and an aiding and abetting instruction not referenced to any one or more of them. On appeal, defendant contends: (1) that he was denied due process of law by the trial court’s instructing the jury, over objection, that he could be found guilty as an aider and abettor to felony murder when he had not been charged with felony murder; (2) that his conviction was obtained in violation of due process of law by the trial court’s allowing the jury to return a verdict of felony murder when there was no evidence of defendant’s involvement in the felony; and (3) that he was denied effective assistance of counsel by his attorney’s failure to object to the consolidation of his case with that of the two others. Held:

      References for Points in Headnotes
    [1] 75 Am Jur 2d, Trial § 647.
    [2] 75 Am Jur 2d, Trial §§ 17, 21.
    Antagonistic defenses as ground for separate trials of codefendants in criminal case. 82 ALR3d 245.
    [3] 21 Am Jur 2d, Criminal Law § 315.
    Incompentency of counsel chosen by accused as affecting validity of conviction. 74 ALR2d 1390.

      1. The jury was carefully instructed that the only crime with which defendant was charged, and as to which he could be found guilty, was first-degree premeditated murder. The jury’s verdict evidenced no confusion as to the crime for which defendant was convicted and there was ample evidence to support the conviction.
    2. The absolute lack of evidence to connect defendant with the beating and robbery separated him from the felony murder, and the jury’s verdict clearly indicated that defendant was convicted of first-degree premeditated murder, not felony murder.
    3. The trial was not a consolidation; the information was issued against all three, and jointly indicted defendants do not have a right to separate trials in Michigan. The decision to sever the trials is left to the discretion of the court. The defenses of the three were not antagonistic to each other and there is no reason to believe that evidence as to the beating and robbery had any effect on defendant’s conviction.
    Affirmed.
    1. Criminal Law — Trial — Jury Instructions — Error.
    Error occurs when a jury instruction is given which will permit the conviction of a defendant on proof of some criminal act other than that charged.
    2. Criminal Law — Indictment and Information — Codefendants — Separate Trials — Statutes.
    Jointly indicted defendants do not have a right to separate trials in Michigan; the decision to sever the trials is left to the discretion of the court, but, where the defenses of the defendants are antagonistic to each other, severance should be granted (MCL 768.5; MSA 28.1028).
    3. Criminal Law — Trial — Ineffective Assistance of Counsel — Appeal.
    A defendant’s claim of ineffective assistance of counsel, based upon his attorney’s failure to ask for a trial separate from others jointly indicted, must be supported by a showing that, but for the alleged error, defendant would have had a reasonably likely chance of acquittal; where the evidence against a defendant is abundant, and where such evidence would likely have been admissible in both trials if severance had been granted, the Court of Appeals refused to find ineffective assistance of counsel.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward Reilly Wilson, Principal Attorney, Appeals, and Timothy A. Baughman, Assistant Prosecuting Attorney, for the people.

      Arthur J. Tarnow, for defendant on appeal.
    Before: J. H. Gillis, P.J., and V. J. Brennan and A. C. Miller, JJ.

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

   Per Curiam.

Defendant was convicted of first-degree premeditated murder, MCL 750.316; MSA 28.548, and sentenced to the statutorily required term of life imprisonment. Wesley Paul Moore and Mary Agnes Butler were convicted of first-degree felony murder. Defendant appealed as of right to this Court, and his conviction was affirmed pursuant to the prosecutor’s motion on September 22, 1976. Leave to appeal was denied by the Michigan Supreme Court on January 26, 1977, 399 Mich 818 (1977).

Subsequently, defendant’s delayed motion for new trial was denied by a Recorder’s Court judge on February 20, 1979. An application for delayed appeal was denied by this Court on July 30, 1979, but on March 27, 1980, the Michigan Supreme Court remanded the case to this Court for consideration as on leave granted, 408 Mich 874 (1980).

Defendant raises three issues on appeal. The first questions the propriety of a jury instruction on aiding and abetting.

At trial, testimony indicated that William Ellis Lewis’s death was caused by multiple gunshot wounds to the head, a single gunshot wound to the leg, and multiple blunt instrument injuries to the head. On the night of the killing, Lewis, Butler and Moore were at Butler’s home together with Larry Adams, two of defendant’s children, and Rochelle Bell. Upon Butler’s discovery that her pistol was missing, the weapon was found on Lewis’s person. Lewis was beaten by Butler and Moore, who also shot Lewis in the leg. During the beating, Lewis’s wallet was removed from his pocket. Defendant was then called to the home, and Adams heard two gunshots shortly before Moore told Adams that he had killed Lewis. Bell stated that she saw Moore and Robinson remove Lewis’s body from the house and that defendant claimed he had taken the last shot at Lewis.' Lewis’s body was found in a vacant house located next door to the Butler home.

During the jury instructions, the trial judge gave a premeditated murder instruction referenced solely to defendant Robinson, a felony-murder instruction referenced solely to Butler and Moore, and an aiding and abetting instruction not referenced to any one or more of them. On appeal, defendant argues that the aiding and abetting instruction improperly suggested that defendant could be convicted of aiding and abetting the others in the felony murder of Lewis, thereby denying defendant due process of law. The first issue protests the instruction because defendant was not charged with aiding and abetting a felony murder. Defendant’s second issue challenges the instruction on the basis that there was no evidence to support such a theory of guilt. We will discuss these issues together.

Clearly, error occurs when a jury instruction is given which will permit the conviction of a defendant on proof of some criminal act other than that charged. People v Buresh, 63 Mich App 629, 631; 234 NW2d 736 (1975), lv den 395 Mich 830 (1976). However, the jury was carefully instructed in the case at bar that the only crime with which defendant was charged, and as to which he could be found guilty, was first-degree premeditated murder.

When the jury returned from its deliberations, the following dialogue occurred:

’’The Clerk: How do you find the defendant Jerry Robinson, guilty or not guilty of murder, first-degree, premeditation [sic]?
’’The Jury Foreman: Guilty.”

The jury’s verdict evidences no confusion at all as to the crime of which defendant was convicted. Further, there was ample evidence to support defendant’s conviction of first-degree premeditated murder. Thus, we find it doubtful that the aiding and abetting instruction operated to confuse the jury. See People v Newsome, 84 Mich App 758, 760-761; 270 NW2d 685 (1978), lv den 404 Mich 801 (1978). Any error which occurred was therefore harmless.

Defendant also cites Watson v Jago, 558 F2d 330 (CA 6, 1977), for the proposition that the notice requirement in US Const, Am VI, mandates that a defendant have notice of all crimes against which he is to defend at trial. Asserting that the jury instructions linked defendant with the others as an aider and abettor, defendant argues that such result violated his sixth amendment right to notice of the charges against him. As noted previously, however, the jury instructions were sufficiently clear so as to preclude jury confusion with regard to the crime with which defendant was charged. The absolute lack of evidence to connect defendant with the beating and robbery further separated him from the felony murder. Finally, the jury’s verdict clearly indicated that defendant was convicted of first-degree premeditated murder, not felony murder.

Defendant’s final appellate challenge is that he was denied effective assistance of counsel, as evidenced by his trial attorney’s failure to object to the consolidation of defendant’s trial with that of Butler and Moore. Defendant alleges that clear prejudice arose when the jury was confronted with testimony as to the brutal beating and robbery of Lewis, which occurred before defendant even entered the house.

In response to defendant’s argument, it must first be noted that the trial was not a consolidation; the information was issued against all three defendants. Second, jointly indicted defendants do not have a right to separate trials in Michigan; the decision to sever the trials is left to the discretion of the court, MCL 768.5; MSA 28.1028. Where the defenses of the defendants are antagonistic to each other, severance should be granted, however. People v Hurst, 396 Mich 1, 6; 238 NW2d 6 (1976).

In the case at bar, defendant does not allege, and it does not appear, that the defenses of the three defendants were antagonistic to each other. Rather, Moore argued self-defense, Butler did not testify, and defendant contended that he left the house before the shooting occurred.

Defendant’s assertion that evidence as to the robbery and beating would not have been admissible at a separate trial in which he was the sole defendant is also rejected. The acts of Butler and Moore were part of the res gestae of the crime, and would thus have been admissible at a trial of defendant alone. People v Castillo, 82 Mich App 476, 479-480; 266 NW2d 460 (1978). Further, the trial judge carefully distinguished between first-degree premeditated murder and felony murder in his instructions to the jury. There is, thus, no reason to believe that evidence as to the beating and robbery had any effect on defendant’s conviction.

Under People v Krist, 93 Mich App 425, 437; 287 NW2d 251 (1979), lv den 407 Mich 963 (1980), a defendant’s claim of ineffective assistance of counsel must be supported by a showing that, but for the alleged error, "defendant would have had a reasonably likely chance of acquittal”. Where the evidence against a defendant is "abundant”, and where such evidence would likely have been admissible in both trials, if severance had been granted, this Court has refused to find ineffective assistance of counsel. Likewise in this case.

Affirmed.