author: M. J. Kelly, P.J.

text:
    PEOPLE v HOLMES
    Docket No. 78-819.
    Submitted March 4, 1980, at Lansing.
    Decided July 1, 1980.
    Defendant was convicted by a jury of larceny in a building and on his plea of guilty of being a third felony offender in the Saginaw Circuit Court, Eugene Snow Huff, J. Defendant appeals, alleging numerous errors. Held:

    1. A prosecuting attorney has discretion to choose under which of two applicable statutes a prosecution will be instituted. A prosecutor’s ability to exercise discretion in charging the act of shoplifting under the larceny in a building statute or the larceny under $100 statute does not violate the constitutional guarantees of due process and equal protection. Prosecution of a shoplifter under the larceny in a building statute rather than the simple larceny statute is particularly appropriate where, as here, the defendant is a prior felony offender.
    2. The habitual criminal statute .applies to a subsequent conviction of larceny in a building even where the defendant could have been charged and convicted under the larceny under $100 statute.
    3. Communication between the trial judge and the members of the jury, though arguably inappropriate, does not warrant reversal of a criminal conviction in the absence of coercive impact on the jurors.
    4. There is no requirement, when a jury has asked for supplemental instructions on specific areas, that the trial judge give all of the instructions previously given.
    5. A brief reference to defendant’s prior trouble with the law by a prosecution , witness does not mandate reversal where the prosecutor did not deliberately inject error into the proceeding and defendant made a similar reference to his past conduct during the course of his own testimony.

      References for Points in Headnotes
    [1, 2, 3] 50 Am Jur 2d, Larceny §§ 49, 50. 63 Am Jur 2d, Prosecuting Attorneys §§ 25, 26.
    Validity, construction, and effect of statutes establishing shoplifting as specific criminal offense. 90 ALR2d 811.

       39 am Jur 2d, Habitual Criminals and Subsequent Offenders § 15.

       21 Am Jur 2d, Criminal Law § 299. 75 Am Jur 2d, Trial §§ 91, 1001.

       75 Am Jur 2d, Trial §§ 716, 1046.

       29 Am Jur 2d, Evidence § 340.

      Affirmed.
    1. Larceny — Criminal Law — Prosecuting Attorneys — Discretion — Statutes.
    A prosecuting attorney has discretion to choose under which of two applicable statutes a prosecution will be instituted; prosecution of a shoplifter under the larceny in a building statute rather than the simple larceny statute is particularly appropriate where the defendant is a prior felony offender.
    2. Larceny — Criminal Law — Prosecuting Attorneys — Discretion — Due Process — Equal Protection.
    A prosecutor’s ability to exercise discretion in charging the act of shoplifting under the larceny in a building statute or the larceny under $100 statute does not violate the constitutional guarantees of due process and equal protection.
    3. Criminal Law — Larceny — Statutes — Habitual Criminals.
    The habitual criminal statute applies to a conviction of larceny in a building after two prior felony convictions even where the defendant could have been charged and convicted under the larceny under $100 statute.
    4. Criminal Law — Jury — Communication Between Judge and Jury — Coercion — Appeal.
    Communication between the trial judge and the members of the jury, though arguably inappropriate, does not warrant reversal of a criminal conviction in the absence of coercive impact on the jurors.
    5. Criminal Law — Instructions to Jury.
    There is no requirement, where a jury has asked for supplemental instructions on specific areas, that the trial judge give all of the instructions previously given.
    6. Criminal Law — Evidence — Prior Trouble with the Law — Appeal.
    A brief reference to a defendant’s prior trouble with the law by a prosecution witness does not mandate reversal where the prosecutor did not deliberately inject error into the proceeding and the defendant made a similar reference to his past conduct during the course of his own testimony.

      Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Robert L. Kaczmarek, Prosecuting Attorney, and Howard B. Gave, Assistant Prosecuting Attorney, for the people.

      Kim Robert Fawcett, Assistant State Appellate Defender, for defendant on appeal.
    Before: M. J. Kelly, P.J., and D. F. Walsh and Beasley, JJ.
   M. J. Kelly, P.J.

Defendant appeals as of right from his jury conviction of larceny in a building, contrary to MCL 750.360; MSA 28.592. Subsequently, defendant pled guilty to a habitual offender charge of being a third felony offender. MCL 769.11; MSA 28.1083. Defendant was sentenced to a term of four to eight years imprisonment.

Defendant contends that the prosecutor abused his discretion in charging him with the felony offense of larceny in a building rather than simple larceny for his alleged shoplifting of five pairs of $13 slacks from J. C. Penney Company. In advancing this argument, defendant relies heavily on People v Carmichael, 86 Mich App 418; 272 NW2d 667 (1978), which deviates from a long line of cases holding the larceny in a building statute applicable to shoplifting offenses even where the property stolen is worth less than $100. E.g., People v Jackson, 29 Mich App 654; 185 NW2d 608 (1971), People v Shepherd, 63 Mich App 316; 234 NW2d 502 (1975), and cases cited therein. Carmichael is factually distinguishable from the present case in two important respects: defendant therein was apparently coerced into entering- a plea of guilty and suffered from acute alcoholism and mental problems.

The circumstances of the instant case closely parallel those of People v Evans, 94 Mich App 4; 287 NW2d 608 (1979), in which another panel of this Court held that prosecution for the greater offense is permissible as a general rule and is particularly appropriate when, as here, the defendant is a prior felony offender. Accordingly, we find the prosecutor properly exercised his charging discretion.

Defendant further claims that the prosecutor’s ability to exercise discretion in charging violates constitutional guarantees of due process and equal protection. This argument has previously been considered and rejected by this Court. Jackson, supra, People v Graves, 31 Mich App 635; 188 NW2d 87 (1971), Evans, supra. The larceny and larceny in a building statutes do not purport to allow two different punishments for the same crime; rather, the distinguishing factor is that the larceny in a building statute requires proof that the larceny was committed in a building. As was stated in People v Jackson, supra, 656, "[i]t is clearly within the discretion of the legislature to distinguish simple larceny and larceny in a building as separate social evils”. Moreover, according to the United States Supreme Court’s recent decision in United States v Batchelder, 442 US 114; 99 S Ct 2198; 60 L Ed 2d 755 (1979), as long as the two larceny statutes give sufficient notice of their differing penalties and are not used to discriminate against classes of defendants, they are not constitutionally infirm. Although defendant in the instant case alleges that he was prosecuted under the larceny in a building statute as a result of his race, the record is absolutely devoid of evidence on this matter since defendant did not establish a record in the trial court at a hearing on a motion for a new trial. In summary, the statutory scheme is constitutional and defendant has failed to show that he was the victim of arbitrary racial discrimination by the prosecutor.

The next three issues raised by defendant concern the permissible application and constitutionality of the habitual offender statute, MCL 769.10 et seq.; MSA 28.1082 et seq., which provides in part:

"Sec. 10. (1) If a person has been convicted of a felony, an attempt to commit a felony, or both, whether the conviction occurred in this state or would have been for a felony in this state if the conviction obtained outside this state had been obtained in this state, and that person commits a subsequent felony within this state, the person shall be punished upon conviction as follows:
"(a) If the subsequent felony is punishable upon a first conviction by imprisonment for a term less than life, then the court, except as otherwise provided in this section or in section 1 of chapter 11, may place the person on probation or sentence the person to imprisonment for a maximum term which is not more than 1-1/ 2 times the longest term prescribed for a first conviction of that offense or for a lesser term.
"(b) If the subsequent felony is punishable upon a first conviction by imprisonment for life, then the court, except as otherwise provided in this section or in section 1 of chapter 11, may place the person on probation or sentence the person to imprisonment for life or for a lesser term.”

Contrary to defendant’s position that the Legislature did not intend the act to apply in those instances where defendant could have been convicted of a misdemeanor rather than a felony, the statutory language clearly reflects legislative intent that a defendant’s third felony conviction trigger application of the statute regardless of alternate charging choices on that conviction. Defendant herein, convicted of two prior felonies in addition to his conviction of the present felony charge of larceny in a building, was properly sentenced under the habitual offender statute.

Defendant’s constitutional attacks upon the habitual offender statute are likewise without merit. Identical Fifth, Eighth and Fourteenth Amendment claims were rejected in People v Shepherd, supra, People v Bohm, 49 Mich App 244, 251; 212 NW2d 61 (1973), People v Hendrick, 52 Mich App 201, 208; 217 NW2d 112 (1974), aff’d 398 Mich 410; 247 NW2d 840 (1976), In re Pardee, 327 Mich 13, 18; 41 NW2d 466 (1950), People v Shastal, 26 Mich App 347, 351; 182 NW2d 638 (1970), People v McGilmer, 96 Mich App 433; 292 NW2d 700 (1980).

It is also submitted that defendant was denied a fair trial by the trial judge’s direct communication with two jurors requesting a reading of certain portions of trial testimony and supplemental instructions on the law of aiding and abetting. Defendant reasons that through this communicative process two dissenting jurors were inadvertently singled out and coerced into voting guilty. The following conversations between the court and jurors form the basis of defendant’s claim:

"The Court: * * * Can you be specific; tell me exactly whose testimony and what portion you want? Anyone may speak.
"The foreman, if you like Mr. Honsinger?
"Juror No. 1: Well, we wanted to be sure that the security guard actually saw Mr. Holmes touch the material, the pants.
"The Court: You see the problem?
"Juror No. 1:1 understand the problem, sir.
"The Court: I can ask the reporter, but it will take some time. I would say that you should return to the jury room and continue with your deliberations. I’ll ask the reporter if she can perhaps locate it. It would be probably on both the direct and on the cross examination.
"Do you know which witness you have in mind?
"Juror No. 1: Well, both of the security guards, that’s the problem.
"The Court: It covers all the testimony in the case.
"Juror No. 1:1 understand that.
"The Court: Is there anyone else that has any comment?
"Juror No. 1: Let’s go back and try again.
"The Court: It’s a difficult matter to handle, but if you will go back and continue with your deliberation, the Court will confer with the reporter and see — and with the attorneys — and see if we can find it. We will, if it’s absolutely necessary. We’ll make every effort.
"Juror No. 1: We’ll go back.
"The Court: But I can’t tell you right now we have it. We don’t have it right now.
"(Jury left the Courtroom.)”

Later the jury returned to the courtroom and requested further instructions on the law of aiding and abetting, specifically whether defendant could have aided and abetted if he did not touch or adjust the slacks. In response, the court reinstructed the jury on the law of aiding and abetting, and then asked if anyone had any further questions. At that point, another juror came forward and the following conversation occurred:

"The Court: * * * Now that is the law on the subject of aiding and abetting. The Court would like to ask whether you have any other questions; any of the jurors who do may speak or the foreman may speak.
"Mrs. Nickleberry?
"Juror No. 13: When you say aiding, would this person have to touch — well, I am saying in this particular case, would the defendant have to touch the article that was stolen?
"The Court: It would depend, you see, upon the circumstances in the case. The statute says aid or assist or encourage, depending upon what you find actually occurred.
"The statute again says whether he directly commits the act constituting the offense or procures, counsels, aids or abets in its commission. A defendant must have performed acts of giving encouragement which aid or assist the commission of the crime, either before or at the time of commission of the crime. The defendant must have intended the commission of the crime at the time of giving the encouragement.
"Now the Court will say there are a number of words used there which I think are used in the ordinary human conversations and are not legal terms exactly. I think the jurors understand what they mean.
"The question is whether the facts in this case would bring the case within the definition of the statute. If you think that it does, you would find the defendant guilty of the crime of which you find he committed.
"On the other hand, if you have a reasonable doubt about it, then you would find the defendant not guilty.
"The Court in giving you these instructions, of course, gives them in response to a specific request on this subject and will ask you to keep in mind all the other instructions the Court has given you about the burden of proof and reasonable doubt and the crimes charged, as well.
"Do you have any other questions?
"Now, the reporter has located some of the testimony, but the Court hesitates to pick out portions of the testimony unless you know and are able to ask for what you want to hear.
"She has reviewed the record. It takes some time to locate in the mass of testimony which she has here exactly which part you want to have her read, but if you can indicate what they are, I think she might be able to read it for you.
"Anyone know? Let us know. If not, any other questions? If not, the Court will ask you to resume your deliberations.
"Thank you.”

The above exchange between trial judge and jurors was not strictly in accord with CJI 3:1:20 which states:

"(9) If you wish to communicate with the Court while you are deliberating, please have your foreman write a note and deliver it to the bailiff. It is not proper to talk directly with the judge, attorneys, court officers or other persons involved in the case, even if the discussion has nothing to do with the case.
"(10) During your deliberation, you must not disclose the state of your deliberations to others outside of the jury room. Therefore, unless you reach a verdict, do not disclose this information, even in the courtroom.”

The communication that took place, though arguably inappropriate, does not warrant reversal in the absence of coercive impact upon the jurors. We find the instant case substantially different than People v Curry, 77 Mich App 85; 257 NW2d 751 (1977), in which the trial court unintentionally discovered how the jury had voted and the identity of the lone dissenter. That juror was singled out for questioning to determine whether religious beliefs hindered his ability to function as a juror and whether he believed further deliberations would prove fruitful. Moreover, the case at bar is not analogous to People v Wilson, 390 Mich 689; 213 NW2d 193 (1973), which involved the trial court’s deliberate discovery and comment upon the numerical division of the jurors, effectively "melting the resistance of the minority and freezing the determination of the majority”. 390 Mich 689, 692. Here the trial court was only informed that two jurors wished certain testimony reread and that there was some confusion regarding the law of aiding and abetting. It did not discover which jurors were having difficulty remembering the testimony or the numerical division of the jury. The jury requests were not critically received; the trial judge agreed to provide the testimony if possible and repeated that portion of the instructions dealing with aiding and abetting. We find no hint of coercion and thus no reversible error. See also People v Sullivan, 392 Mich 324; 220 NW2d 441 (1974), People v Robert G Thompson, 81 Mich App 348; 265 NW2d 632 (1978), Iv gtd 402 Mich 938 (1978).

Defendant claims additional instructional error in the trial court’s failure to include the theory of mere presence within its supplemental aiding and abetting instructions. At trial defendant objected to the court’s failure to instruct the jurors that the aider and abettor must have knowledge that a crime is being committed, but never referred to the "mere presence” instruction. In any event, defendant was not entitled to reinstruction on mere presence in the absence of a specific jury request. As this Court stated in People v Darwall, 82 Mich App 652, 663; 267 NW2d 472 (1978):

"There is no requirement that when a jury has asked for supplemental instruction on specific areas that the trial judge is obligated to give all of the instructions previously given. The trial judge need only give those instructions specifically asked.
"As stated in People v Green, 7 Mich App 346, 358; 151 NW2d 834 (1967): 'Absent a request by the jury, it was not error to fail to reiterate the previous instructions concerning the charges involved’. On the basis of Green, supra, and the trial court’s charge as a whole in this case, it is apparent that the supplemental instructions given did not constitute an abuse of discretion by the trial judge and defendant’s issue is without merit.”

We find no merit in defendant’s argument that a brief reference to defendant’s prior trouble with the law by a prosecution witness mandates reversal. The response was in answer to a question regarding defendant’s statements while being detained at the store. The prosecutor did not deliberately inject error into the proceedings by violating the court’s pretrial order suppressing evidence of defendant’s prior convictions. Unlike People v McGee, 90 Mich App 115, 116-117; 282 NW2d 250 (1979), the prosecutor here could not have reasonably anticipated such a response. Defendant made a similar reference to his past conduct during the course of his own testimony and therefore cannot successfully claim that he was prejudiced by this witness’s response. See People v Bryan, 92 Mich App 208; 284 NW2d 765 (1979).

Finally, we reject defendant’s argument that his habitual offender sentence must be vacated in accordance with People v Fountain, 407 Mich 96; 282 NW2d 168 (1979). In deciding whether a new rule of law should be given retroactive or prospective effect, three factors should be considered: (1) the purpose of the new rule, (2) the general reliance on the old rule, and (3) the effect on the administration of justice. People v Hampton, 384 Mich 669, 674; 187 NW2d 404 (1971). Application of this balancing test to the new rule of Fountain persuades us that it should be given only prospective effect.

Affirmed.


source: Caselaw Access Project

author: Mackenzie, J. Cynar, P.J.

license: Public Domain

text:
    RUSINEK v SCHULTZ, SNYDER & STEELE LUMBER COMPANY
    Docket No. 78-3137.
    Submitted June 18, 1979, at Lansing.
    Decided July 1, 1980.
    Leave to appeal applied for.
    Eugene Rusinek and his wife Marie Rusinek filed a complaint in Genesee Circuit Court under the Michigan no-fault insurance act against Schultz, Snyder & Steele Lumber Company and Richard Braybrook for injuries arising out of an automobile accident. Eugene Rusinek claimed that he sustained a serious impairment of body function and Marie Rusinek based her claim on loss of consortium. Defendant Schultz, Snyder & Steele Lumber Company (hereinafter defendant) moved to dismiss Marie’s claim for loss of consortium alleging that it was not recognized under the Michigan no-fault law. Robert M. Ransom, J., denied the defendant’s motion. The jury awarded plaintiff Eugene Rusinek $50,000 and plaintiff Marie Rusinek $10,000 and a judgment was entered in favor of the plaintiffs by Judge Ransom. The defendant moved for a new trial but the motion was denied. Defendant appeals. Held:

    1. The spouse of a party injured in an automobile accident may not recover for loss of consortium under the no-fault insurance act because the spouse is not the party who has suffered death, serious impairment of body function, or permanent serious disfigurement.
    2. Generally, a requested jury instruction which states the applicable law and is supported by the evidence must be given.
    3. The requirement that the plaintiff in an action under the no-fault act show a serious impairment of body function not only presents a threshold requirement to recover in tort but also a limitation precluding recovery of future damages where plaintiff no longer suffers from a serious impairment of body function.

      References for Points in Headnotes

       7 Am Jur 2d (Rev), Automobile Insurance § 354.
    Validity and construction of "no-fault” automobile insurance plans. 42 ALR3d 229.

       75 Am Jur 2d, Trial § 574.

       7 Am Jur 2d (Rev), Automobile Insurance § 349.

       43 Am Jur 2d, Insurance §§ 271, 272, 274.

       7A Am Jur 2d, Automobile Insurance § 450.
    Wife’s right of action for loss of consortuim. 36 ALR3d 900.

      Reversed and remanded.
    Cynar, P.J., concurred in part and dissented in part. He disagreed with the majority regarding the right to recover for loss of consortium under the Michigan no-fault insurance law but was in total agreement with the handling of the other issues. He suggested that since the purpose of the no-fault act is to compensate persons injured in accidents and noneconomic claims of loss of consortium have long been recognized in Michigan and are not specifically excluded by the no-fault statute, claims for loss of consortium should he allowed under Michigan law.
    Opinion op the Court
    1. Insurance — Automobiles — No-Fault — Loss op Consortium.
    The spouse of a party injured in an automobile accident may not recover for loss of consortium under the no-fault act because the spouse is not the party who has suffered death, serious impairment of body function, or permanent serious disfigurement (MCL 500.3135[1]; MSA 24.13135[1]).
    2. Jury — Instructions — Judges.
    Generally, a requested jury instruction which states the applicable law and is supported by the evidence must be given.
    3. Insurance — Automobiles — No-Fault — Requirements — Threshold.
    The requirement that the plaintiff in an action under the no-fault act show a serious impairment of body function' not only presents a threshold requirement to recover in tort but also a limitation precluding recovery of future damages where plaintiff no longer suffers from a serious impairment of body function.
    Concurrence in Part and Dissent in Part by Cynar, P.J.
    4. Insurance — Statutes — Interpretation.

      Laws applicable to insurance are to be liberally construed in favor of policyholders, creditors and the like.

      5. Insurance — Automobiles — No-Fault — Loss op Consortium.

      The Michigan no-fault insurance act does not bar a spouse’s claim for loss of consortium where the injured party has suffered serious impairment of body function because: (1) the purpose of the no-fault act is to compensate persons injured in auto

      accidents; (2) noneconomic claims of loss of consortium have long been recognized in Michigan as a valid claim for damages, and (3) the Michigan no-fault act does not specifically exclude claims for lost consortium.

      Edwin Jakeway, P.C. (Bennett S. Engelman, of counsel), for plaintiffs.

      Brownell, Andrews, Philpott & Piper (by Douglas M. Philpott), for defendant.
    Before: Cynar, P.J., and Mackenzie and L. W. Corkin, JJ.

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

   Mackenzie, J.

Plaintiffs filed a complaint against defendants for damages arising out of an auto accident which occurred on July 30, 1974. Plaintiff Eugene Rusinek claimed that he sustained a "serious impairment of body function” in the accident within the meaning of the Michigan no-fault act. His injuries consisted of a strained neck and back and a sore elbow. Plaintiff Marie Rusinek brought a claim based upon loss of consortium. Defendant Schultz, Snyder & Steele Lumber Company (hereinafter defendant) made a pretrial motion to dismiss Marie Rusinek’s loss of consortium claim arguing that it is not recognized under the Michigan no-fault act. The motion was denied by the trial court.

The sole issue litigated at trial was the question of damages. The jury returned a verdict of $50,000 in favor of Eugene Rusinek and a verdict of $10,-000 in favor of Marie Rusinek. Defendant made a motion for a new trial, which was denied. Defendant now appeals as of right, raising three issues.

Defendant first contends that the trial court erred in ruling that Marie Rusinek could be awarded damages for loss of consortium under the no-fault act. We agree.

This issue was previously faced by this Court in Warner v Brigham, 90 Mich App 640; 282 NW2d 428 (1979). The majority held that a claim for loss of consortium comes within the no-fault statute, where the spouse of the claimant has suffered death, serious impairment of body function, or permanent serious disfigurement. According to MCL. 500.3135(1); MSA 24.13135(1):

"A person remains subject to tort liability for noneconomic loss caused by his ownership, maintenance or use of a motor vehicle only if the injured person has suffered death, serious impairment of body function or permanent serious disfigurement.’.’

It was the majority’s opinion that the statute did not limit liability to losses suffered by the injured person, but that any noneconomic loss compensable at common law, including consortium, is recoverable under § 3135.

Judge Bash ara dissented in Warner because, in his opinion, based on the operative language of the statute and its express purpose of limiting tort actions arising from auto accident injuries, the Legislature intended to abolish this type of common law derivative tort liability.

He further relied upon the general rule, that the express mentioning of something in a statute implies the exclusion of other similar things. Since loss of consortium had not been specifically retained in § 3135, the right to recover for such damages had been abolished.

Finally, Judge Bashara stated that he could not see why a party suffering no physical injury should be given preference in recovering noneconomic losses over persons with physical injuries insufficient to satisfy the threshold requirements of § 3135(1).

We agree with the reasoning of Judge Bashara and hold that the spouse of a party injured in an auto accident may not recover for loss of consortium under the no-fault act. The language of §3135(1) clearly states that the "injured party” must suffer death, serious impairment of body function for permanent serious disfigurement. For purposes of a loss of consortium claim, however, the spouse of the person physically hurt is the "injured party”, and is suing for damages to his or her own interest. See Montgomery v Stephan, 359 Mich 33; 101 NW2d 227 (1960). Since the spouse is not the party who has suffered death, serious impairment of body function, or permanent serious disfigurement, he or she is not entitled to recover under the statute.

Defendant next contends that the trial judge erred in refusing to give defendant’s requested instruction that plaintiff was not entitled to recover noneconomic damages for the period beyond which he suffered a serious impairment of body function.

The testimony of plaintiff Eugene Rusinek and two treating physicians indicated that although he still experiences intermittent pain and has difficulty lifting and bending, he was able to return to work as a machine repairman in January of 1975 and carry on with most normal activities. In closing argument, plaintiffs’ counsel admitted that Mr. Rusinek was not suffering from a serious impairment of body function at the time he returned to work; however, he argued that as Mr. Rusinek initially suffered a serious impairment following the accident, he had met the threshold requirement and should be able to collect damages for future pain and suffering.

Generally, a requested instruction which states the applicable law and is supported by the evidence must be given. Richman v City of Berkley, 84 Mich App 258, 264; 269 NW2d 555 (1978).

The no-fault statute’s elimination of tort liability for noneconomic damages except where death, serious impairment of body function or permanent serious disfigurement result was designed to correct certain deficiencies in the tort system. Two of these evils were the barrage of lawsuits heavily burdening the state’s court system and the fact that minor injuries were often over-compensated while serious injuries were under-compensated. See Shavers v Attorney General, 402 Mich 554, 621-622; 267 NW2d 72 (1978). Therefore, we believe that the requirement that the plaintiff show a serious impairment of body function not only presents a threshold requirement to recover in tort but also a limitation precluding recovery of future damages where plaintiff no longer suffers from a serious impairment of body function.

Due to the trial judge’s failure to give the requested instruction, it is unclear whether the jury found that Mr. Rusinek still suffers from a serious impairment. In light of our holding, it is unnecessary to discuss defendant’s other allegations of error.

Reversed and remanded.

L. W. Corkin, J., concurred.

Cynar, P.J.

(concurring in part, dissenting in part). While disagreeing on whether the right to recovery for loss of consortium exists, I am in total agreement with the majority on the handling of the other issues and the decision to reverse and remand.

The loss of consortium claim has long been recognized as an element of damages in Michigan. In Montgomery v Stephan, 359 Mich 33; 101 NW2d 227 (1960), the Michigan Supreme Court held that a wife states a valid cause of action in a suit for loss of consortium, which the Court described as "conjugal fellowship”.

Loss of consortium has continued to be recognized in Michigan and its definition has been expanded to include "society, companionship, service, affection, and all other incidents of the marriage relationship”. Washington v Jones, 386 Mich 466, 472; 192 NW2d 234 (1971), Kailimai v Firestone Tire & Rubber Co, 87 Mich App 144, 148; 273 NW2d 906 (1978).

Applying the definitions in the above-cited cases, it is clear that a loss of consortium claim is a noneconomic claim: a claim for, in part, fellowship, companionship, and affection rather than loss of wages.

However, the defendant argues that even if a consortium claim is a noneconomic tort claim historically allowed in Michigan, the enactment of the Michigan no-fault insurance act excludes recovery for loss of consortium claims.

The defendant cites MCL 500.3135; MSA 24.13135, which reads in part:

"A person remains subject to tort liability for noneconomic loss * * * only if the injured person has suffered death, serious impairment of body function or permanent serious disfigurement.” (Emphasis added.)

The defendant argues that the only reasonable interpretation of this section is that the term "injured party” refers to the person seeking damages; in this case, the wife and not the victim. Accordingly, since the wife has only suffered the loss of her husband’s companionship and affection she is precluded from recovery. This writer disagrees with defendant’s interpretation.

In Attorney General ex rel Ins Comm’r v Michigan Property & Casualty Guaranty Ass’n, 80 Mich App 653; 263 NW2d 918 (1978), the Court noted that laws applicable to insurance are to be "liberally construed in favor of policyholders, creditors and the like”. Furthermore, the Court quoted as follows:

" 'In Attorney General ex rel Common Council of the City of Detroit v Marx, 203 Mich 331 [168 NW 1005 (1918)], we quoted the following from 2 Lewis’ Sutherland Statutory Construction (2d ed), § 490:
" ' " 'Statutes will be construed in the most beneficial way which their language will permit to prevent absurdity, hardship or injustice; to favor public convenience and to oppose all prejudice to public int6r©sts **
" 'In Sibley v Smith (syllabus), 2 Mich 486 [(1853)], and again in Detroit Common Council v Engel, 207 Mich 106 [173 NW 547 (1919)], we said:
"' "In construing statutes of doubtful meaning, courts are authorized to collect the intention of the legislature from the occasion and necessity of the law — from the mischief felt, and the objects and remedy in view — and the intention is to be taken, or presumed, according to what is consonant to reason and good discretion.” ’ Id. at 44-45.” Id., 657.

This policy of liberal interpretation in favor of .the policyholder was specifically applied to the construction of the Michigan no-fault statute in Bierbusse v The Farmer’s Ins Group of Companies, 84 Mich App 34; 269 NW2d 297 (1978), where the Court stated:

"The no-fault automobile statute is remedial in nature, attempting to correct the deficiencies found in the old tort system. See, Shavers v Attorney General, 65 Mich App 355, 366; 237 NW2d 325 (1975), lv gtd, 396 Mich 869 (1976). Remedial statutes are to be construed liberally in favor of the persons intended to be benefited by the statute. Hockenhull v Cutler Hubble, Inc, 39 Mich App 163; 197 NW2d 344 (1972), Hite v Evart Products Co, 34 Mich App 247, 252; 191 NW2d 136 (1971).” Id., 37.

Furthermore, the basic purpose of no-fault insurance is to insure the compensation of persons injured in auto accidents. Pollock v Frankenmuth Mutual Ins Co, 79 Mich App 218; 261 NW2d 554 (1977).

Accepting the principles that the: (1) purpose of the no-fault act is to compensate persons injured in auto accidents; (2) noneconomic claims of loss of consortium have long been recognized in Michigan as a valid claim for damages; and (3) Michigan no-fault act did not specifically exclude claims for lost consortium, this writer finds that the Michigan no-fault insurance act does not bar a spouse’s claim for a lack of consortium.

I am in agreement with Warner v Brigham, 90 Mich App 640; 282 NW2d 428 (1979), where the majority held that a loss of consortium comes within the no-fault act, specifically § 3135, where the spouse of the claimant has suffered a serious impairment of body function under MCL 500.3135(1); MSA 24.13135(1). However, as indicated in Warner v Brigham, supra, the injured plaintiff must establish serious impairment of body function as a threshold requirement to recover in tort. Further, as expressed by Judge Mackenzie in her opinion, recovery for future damages is precluded during the time when the injured person does not suffer from a serious impairment of body function.


author: Bronson, P.J.

text:
    BESCOE v LABORERS’ UNION LOCAL NO 334
    Docket No. 78-3359.
    Submitted November 13, 1979, at Detroit.
    Decided July 1, 1980.
    Leave to appeal applied for.
    Serstel Corporation undertook to rebuild certain blast furnaces owned by Great Lakes Steel Company. Pursuant to an agreement between Laborers’ Union Local No. 334 and an association of Detroit area general contractors, Local No. 334 referred Howard Morgan to Serstel for the position of foreman. While this agreement provided that Serstel would hire from those referred by the union, Serstel was not bound to hire any particular referral and retained the power to fire any person that it hired. Morgan was hired and thereafter encountered difficulties with the job superintendent, which included threats of violence by Morgan against the superintendent. Union representatives were called on several occasions to speak with the job superintendent about the Morgan situation. After one of these disputes with the superintendent, Morgan returned to the job and attacked and severely injured a worker on the job, Edwin Bescoe. Bescoe, and his wife Lorraine, commenced an action for damages against Local No. 334 and Morgan and others. Following a jury trial in Wayne Circuit Court, John R. Urso, J., a verdict of $125,000 was returned in favor of Edwin Bescoe and a verdict of $25,000 was returned in favor of Lorraine Ann Bescoe, both verdicts running against Local No. 334 and Morgan. Defendant union appeals arguing that the trial court lacked subject matter jurisdiction in that plaintiffs’ claim was based upon alleged acts which involved matters which have been preempted by Federal labor law. Held:

    1. The doctrine of Federal preemption of jurisdiction over matters within the scope of the National Labor Relations Act seeks to insure the existence of a uniform national labor policy. The doctrine of preemption is based upon constitutionally mandated Federal supremacy where state regulation conflicts with a Federally protected right.

      References for Points in Headnotes

       48 Am Jur 2d (Rev), Labor and Labor Relations § 546. 48A Am Jur 2d, Labor and Labor Relations §§ 1727 et seq., 2073.

       48 Am Jur 2d (Rev), Labor and Labor Relations § 464.

       48 Am Jur 2d (Rev), Labor and Labor Relations §§ 398, 402.

      2. Federal preemption forbids all form of state control of the practices protected and prohibited by National Labor Relations Act except to the extent that the act itself permits state control or to the extent that the courts have discerned no congressional intent to preempt local jurisdiction. Primary among those instances in which preemption has been found not to apply to state regulation of labor practices are: (1) activities which are merely of peripheral concern to Federal labor regulation, and (2) activities which touch interests so deeply rooted in local feeling and responsibility that, in the absence of compelling congressional direction, deprivation of the power of a state to act will not be inferred. The application of these exceptions apply most directly to conduct which is arguably prohibited by Federal law, rather than to conduct which is arguably protected by Federal law.
    3. Since plaintiffs’ first claim was based upon defendant union’s peaceful efforts to intercede on Morgan’s behalf in his disputes with the superintendent representing the employer and since, pursuant to Federal law, the union’s activities on behalf of Morgan were not only protected but, in fact, probably mandated, the circuit court lacked subject matter jurisdiction, the matter of the claim having been preempted by the Federal law.
    4. Plaintiffs’ claim based upon the alleged unfair representation of the union fails for lack of subject matter jurisdiction by the trial court, since plaintiff failed to plead or prove that the conduct of the union did not enjoy Federal protection or constituted willful misconduct by the union. Plaintiff thus failed to establish a basis upon which the operation of the preemption doctrine might have been avoided.
    5. The agreement between the union and the employers’ association whereby the union would refer applicants for positions did not create any duty or obligation to insure a safe workplace such that the union would become liable for the tortious acts committed by Morgan.
    Reversed and remanded with instructions.
    1. Labor Relations — Federal Preemption — National Labor Relations Act — Public Policy — Federal Supremacy.
    The doctrine of Federal preemption of jurisdiction over matters within the scope of the National Labor Relations Act seeks to insure the existence of a uniform national labor policy; to the extent that a state seeks to regulate labor activities protected by Federal law, preemption is based upon constitutionally mandated Federal supremacy.
    2. Labor Relations — National Labor Relations Act — State Control — Federal Preemption — Exceptions.
    All form of state control of activities arguably within the protected practices and unfair labor practices sections of the National Labor Relations Act is forbidden except to the extent that the act itself provides for a state action or to the extent that the courts have been unable to discern a congressional intent to preempt local jurisdiction.
    3. Labor Relations — Federal Preemption — Exceptions.
    Judicially created exceptions to preemption of local jurisdiction of matters arguably within the scope of the Federal regulation of labor-management relations fall mainly into two areas: (1) activities which are merely of peripheral concern to Federal labor regulation and (2) activities which touch interests so deeply rooted in local feeling and responsibility that, in the absence of compelling congressional direction, deprivation of the power of the states to act'will not be inferred.
    4. Labor Relations — Federal Preemption — Exceptions — Application of Exceptions.
    The exceptions to the preemption doctrine, as it relates to labor relations matters, apply most directly to conduct which is arguably prohibited by Federal law, rather than to conduct which is arguably protected by Federal law.
    5. Labor Relations — Federal Preemption — National Labor Policy.
    State court jurisdiction of matters concerning the regulation of labor relations is preempted where there is a substantial need to insure that conduct protected by Federal law is not prohibited through misinterpretation of Federal law with a consequential frustration of the congressionally mandated national labor policy.
    6. Labor Relations — Courts — Jurisdiction — Torts — Union Liability for Efforts to Protect a Member — Federal Preemption.
    Michigan trial courts lack subject matter jurisdiction over a claim for damages brought against a labor union where such claim is based upon the assertion that a union’s alleged tort liability arose out of its peaceful efforts to intercede on behalf of a person who ultimately assaulted and injured a fellow employee making a claim for damages; such union activities are clearly protected by the National Labor Relations Act and the exercising of jurisdiction by local courts is preempted by the need to insure a uniform national labor policy.
    7. Labor Relations — Courts — Jurisdiction — Torts — Labor Unions — Fair Representation — Pleadings.
    Michigan trial courts lack subject matter jurisdiction of a tort claim for damages against a union, such claim being based upon a claim of unfair union representation, where the plaintiff has failed to plead and prove that the conduct of the union did not enjoy Federal protection or constituted willful misconduct by the union.
    8. Labor Relations — Labor Unions — Torts — Employment Referrals — Safe Workplace.
    An agreement between a union and an employer whereby the employer will hire as a foreman an individual referred by the union does not establish liability in the union for tortious job-related acts undertaken by the person so recommended by the union in the absence of the power of the union to fire the individual; such referral action by the union did not create in the union the duty to insure a safe workplace.

      James F. Finn and Mark S. Michael, for plaintiffs.

      Miller, Cohen, Martens & Sugarman, P.C. (by William L. Martens, Duane F. Ice and Lea B. Vaughn), for Laborers’ Union Local No. 334.
    Before: Bronson, P.J., and D. C. Riley and E. A. Quinnell, JJ.

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

   Bronson, P.J.

Defendant Laborers’ Union Local 334 appeals of right the judgment of the trial court, entered pursuant to a jury verdict, in favor of plaintiffs and against both defendant union and defendant Howard Morgan, jointly and severally. Damages were awarded to plaintiff Edwin Bescoe in the amount of $125,000 and to plaintiff Lorraine Ann Bescoe in the amount of $25,000.

I

In the summer of 1972 Serstel Corporation undertook to rebuild blast furnaces which were owned by Great Lakes Steel Company and located at Great Lakes’ Zug Island facility. Serstel informed the various trade unions in the area of the number of workers needed, and workers were referred to and hired by Serstel. Among these were Howard Morgan, who was referred by defendant Laborers’ Local 334, and Edwin Bescoe, who was referred by the Operating Engineers Local 324.

Morgan was referred as foreman of the crew of laborers, and was hired by Serstel in that capacity. As foreman, it was his job to arrange for the supply of bricks and other materials to his work area. This part of his job brought him into contact with Bescoe, who operated a fork lift truck and who would, on occasion, be responsible for transporting the materials Morgan requested.

Testimony indicated that Serstel’s superintendent, Charles Larimer, encountered difficulty with Morgan. Larimer testified that Morgan would not do as he was told, that he often came to work with alcohol on his breath (although Larimer was unable to determine whether this adversely affected Morgan’s work), and that he was verbally abusive. Disagreements between Morgan and Larimer escalated to the point where Morgan made threats of violence against Larimer. Larimer’s response to his dissatisfaction with Morgan usually took the form of calls to the union. The union would then send a representative who would speak with both Larimer and Morgan, and tensions would ease for a while. Larimer testified that he "tried” to fire Morgan on several occasions, but that he would be told by the union that Morgan could not be fired. Larimer never called the Great Lakes plant protection forces regarding Morgan.

In the early morning hours of September 9, 1972, Morgan reported for work on the midnight shift. He quickly became embroiled in a dispute with Larimer, who smelled alcohol on Morgan’s breath. Within the hour, Morgan attacked and severely injured Bescoe. The record is not entirely clear as to the reason why Morgan attacked Bescoe, although there was testimony to indicate that Morgan was upset with the fact that Bescoe hauled away refuse containers before delivering bricks. In any event, as Bescoe drove his fork lift truck into Morgan’s area, Morgan stopped Bescoe, turned off the truck’s ignition and proceeded to chase Bescoe around the truck. Bescoe attempted to flee, but Morgan caught up with him and cut him on the neck with a knife. Morgan then departed the island, while Bescoe was taken to the hospital where he was treated and released. Medical testimony indicated that Bescoe is physically and psychologically unable to work.

II

The principal issue in this case is whether the trial court lacked jurisdiction to entertain the action against the union on the basis that the National Labor Relations Act, as amended, preempts state court jurisdiction.

The preemption doctrine in the context of labor relations law seeks primarily to insure the existence of a uniform national labor policy. Additionally, and particularly in cases where the state is seeking to regulate activity protected under Federal law, preemption is based on constitutionally mandated Federal supremacy. US Const, art VI, § 2, Sears, Roebuck & Co v San Diego County Dist Council of Carpenters, 436 US 180, 199-200; 98 S Ct 1745; 56 L Ed 2d 209 (1978). The United States Supreme Court has recognized that Congress, in enacting comprehensive legislation governing labor relations in enterprises affecting commerce and in creating a centralized administrative body charged with administering that legislation, intended to exclude the states from enforcing conflicting laws and procedures and intended to oust both state and Federal courts from the administration of Federal labor laws. San Diego Building Trades Council v Garmon, 359 US 236; 79 S Ct 773; 3 L Ed 2d 775 (1959).

After experience had shown that previous efforts to delineate the scope of the preemption doctrine had been unsatisfactory, the Court in Garmon, supra, 244, established the broad rule of preemption that still pertains today:

"When it is clear or may fairly be assumed that the activities which a State purports to regulate are protected by § 7 of the National Labor Relations Act, or constitute an unfair labor practice under § 8, due regard for the federal enactment requires that state jurisdiction must yield. To leave the States free to regulate conduct so plainly within the central aim of federal regulation involves too great a danger of conflict between power asserted by Congress and requirements imposed by state law.”

Furthermore, the Court made it clear that preemption was to apply even when the conduct which was subject to regulation was only "arguably” under §§ 7 and 8 of the act:

"When an activity is arguably subject to § 7 or § 8 of the Act, the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interference with national policy is to be averted.” Garmon, supra, 245.

The Garmon Court also recognized that, to serve these policies, the preemption doctrine had to bar more than the enforcement of state labor laws. Accordingly, all form of state control was forbidden, including the award of damages to redress private wrongs when the activity complained of is potentially subject to §§ 7 and 8 of the act._

The broad rule of preemption is not, however, without its exceptions. Many of these exceptions have been specifically created by Congress. For example, § 303 of the Labor Management Relations Act allows suit in Federal district court by any person sustaining business or property damage as a result of certain union unfair labor practices, even though the substance of the conduct might also be cognizable by the National Labor Relations Board (NLRB). Under § 301 of the Labor Management Relations Act suit may be brought in either state or Federal court for breach of a collective bargaining agreement. Section 14(c)(2) of the National Labor Relations Act, as amended by the Labor Management Reporting and Disclosure Act, allows state courts and administrative agencies to assert jurisdiction over labor disputes where the NLRB has declined to exercise its jurisdiction.

There exist, in addition, judicially created exceptions arising from cases where the court has been unable to discern a congressional intent to preempt local jurisdiction over the activity involved. For example, in Vaca v Sipes, 386 US 171; 87 S Ct 903; 17 L Ed 2d 842 (1967), the Court held that suits for breach of a union’s duty of fair representation were cognizable in state court despite the fact that the NLRB had recently held that breach of the duty amounted to an unfair labor practice under § 8. See also Bebensee v Ross Pierce Electric, Inc, 400 Mich 233; 253 NW2d 633 (1977). The holding was based on the history of the duty, including the fact that such suits were allowed before the board had decided to exercise jurisdiction over the area, and on the unique position of the duty in the scheme of labor relations law.

Most of the cases which have resulted in judicially created exceptions to the preemption doctrine have fallen within at least one of two areas specifically left open in Garmon:

"[D]ue regard for the presuppositions of our embracing federal system, including the principle of diffusion of power not as a matter of doctrinaire localism but as a promoter of democracy, has required us not to find withdrawal from the States of power to regulate where the activity regulated was a merely peripheral concern of the Labor Management Relations Act. See International Ass’n of Machinists v Gonzales, 356 US 617 [2 L Ed 2d 1018, 78 S Ct 923]. Or where the regulated conduct touched interests so deeply rooted in local feeling and responsibility that, in the absence of compelling congressional direction, we could not infer that Congress had deprived the States of the power to act.” Garmon, supra, 243-244. (Emphasis added.) (Footnote omitted.)

These exceptions apply most directly to conduct arguably prohibited, rather than to arguably protected conduct. Sears, supra, 194-197.

In Linn v United Plant Guard Workers of America, 383 US 53; 86 S Ct 657; 15 L Ed 2d 582 (1966), the Court applied both Garmon exceptions in upholding Federal court diversity jurisdiction in a libel action. During an organizing campaign, leaflets had been circulated which allegedly libeled an official of the employer. Although the Court noted that even the most robust language is protected in the context of labor relations, that protection was terminated at the point where the language becomes malicious libel. The controversy was, nevertheless, within Garmon’s broad sweep since circulation of the leaflets was arguably an unfair labor practice under § 8(b)(1)(A) of the act. The Court refused to find jurisdiction preempted, however, under both the "peripheral concern” and "deeply rooted local feeling” exceptions. Several factors led the Court to this conclusion. First, and perhaps most important, since the conduct sought to be reached in the tort action was not protected under the act, only arguably prohibited, there was no danger of state law restricting conduct protected by Congress. The Court also noted that the focus of an unfair labor practice charge before the board would be on the coercive nature of the statement rather than on its maliciously defamatory characteristics and that the board would be unable to award damages for harm to reputation. Moreover, the tort action could be adjudicated without reference to the board’s concern over the coercive nature of such statements in the context of a representation election. Damages could only be awarded for conduct that was defamatory, not simply coercive. Finally, the Court was of the opinion that an "overriding state interest” existed in the protection of citizens from malicious libel.

In Farmer v Local 25, United Brotherhood of Carpenters and Joiners of America, 430 US 290; 97 S Ct 1056; 51 L Ed 2d 338 (1977), the Court was faced with a case that was similar to Linn. In Farmer, plaintiff brought suit against his union and others in state court alleging discrimination in hiring hall referrals, breach of contract, and the intentional infliction of emotional distress. The trial court sustained a demurrer to the discrimination and contract claims on the basis of Federal preemption but allowed the tort claim to go to trial. On appeal, the Supreme Court noted the broad rule of Garmon as well as its exceptions.

The specific conduct complained of, "outrageous conduct, threats, intimidation, and words”, was not seen as protected by the act, but, as in Linn, this conduct was arguably prohibited by the act. As a result, a rigid application of Garmon would have required that state court jurisdiction be preempted. The Court declined to read Garmon so strictly, however, and based on factors similar to those present in Linn, found no congressional intention to preempt the tort cause of action. If the plaintiff had filed with the board, the focus of inquiry would have been on whether the union had practiced unlawful discrimination. The state court action, on the other hand, involved a determination of whether the union intentionally engaged in outrageous conduct resulting in mental distress. The state court could award damages for the mental distress where the board could not, and, in awarding such damages, the state court would not be involved with conduct that was the concern of the board.

The Court was careful to point out, however, that state and Federal courts were not vested with jurisdiction simply because the conduct complained of was only prohibited by the act. While union discrimination will certainly cause some anxiety and emotional distress, the Court held that the "outrageous conduct”, which under state law was the gravamen of the cause of action, could not be shown by discrimination alone. Discrimination is the province of the board and due regard for the Federal regulatory scheme required that claims of discrimination be presented there. Where the potential plaintiff could point to outrageous conduct distinct from the actual discrimination, although related to it, then the courts could proceed.

In Sears, Roebuck & Co v San Diego County Dist Council of Carpenters, 436 US 180; 98 S Ct 1745; 56 L Ed 2d 209 (1978), the Court was faced with the issue of whether state court jurisdiction to enjoin certain peaceful picketing was preempted by Federal labor law. The pickets appeared at a Sears retail outlet after the union determined that carpentry work was taking place at the store without the use of workers from the local hiring hall and after attempts to resolve the dispute were unsuccessful. The pickets were stationed on Sears property and were requested to leave by the store security manager. The union refused unless forced by legal action. Sears then filed suit and obtained an injunction against the trespass, at which point the pickets moved to the nearby public sidewalk.

Unlike both Linn and Farmer, where the activity complained of enjoyed no protection, the Court in Sears proceeded on the assumption that the picketing could arguably be either protected under § 7 or prohibited under § 8. Once again refusing to apply Garmon in an overly rigid manner, the Court undertook an analysis of the applicable exceptions. Sears is particularly noteworthy for the fact that the Court examined separately the arguably prohibited and arguably protected nature of the union’s conduct. This sort of analysis had been foreshadowed by both Linn and Farmer, cases involving prohibited conduct, where the Court had implied that a more serious preemption problem existed when the conduct sought to be regulated by the courts was protected by Federal law. The fundamental distinction between these two strands of Garmon is that when a state attempts to prohibit, through whatever means, conduct actually protected by Federal law constitutional considerations of Federal supremacy are invoked to a greater extent. A state may not prohibit what Federal law protects. Such concerns are not applicable, however, when the state merely seeks to prohibit different aspects of the same conduct that Federal law prohibits, and where there is no danger of the state becoming involved with those aspects of the conduct that are the concern of the Federal law.

Examining first the arguably prohibited nature of the union’s conduct in the Sears case, the Court, applying the rationale developed in Linn and Farmer, held that preemption did not work to prohibit state court jurisdiction. If Sears had filed an unfair labor practice charge the inquiry would have concerned the intent of the picketing. The state court action, however, involved the trespassory nature of the picketing and was concerned only with the location of the pickets. Accordingly, the state court action could proceed without any need to examine those aspects of the conduct which were the concern of Federal law and without danger of conflicting regulation.

In analyzing the conduct’s arguably protected nature, the Court first noted that it was impossible for the state to legitimately grant the relief requested without undertaking to determine if the conduct was protected under Federal law. Accordingly, Sears would ordinarily be required to pursue the issue through the mechanisms of the National Labor Relations Board rather than the courts. The Court was unwilling to end the matter here, however, due to the practical limitations on such a course of action. Sears could not directly obtain a decision on the question of whether the union’s trespass was protected under Federal law. While it could indirectly bring the matter within the board’s jurisdiction by ordering the pickets to leave, thereby inducing the union to file an unfair labor practice charge alleging interference with § 7 rights, the union declined the invitation and instead indicated pickets would be removed from Sears’ property only under legal compulsion. This situation led the Court to adopt another exception to the preemption doctrine applicable to cases involving arguably protected conduct:

"The primary-jurisdiction rationale justifies pre-emption only in situations in which an aggrieved party has a reasonable opportunity either to invoke the Board’s jurisdiction himself or else to induce his adversary to do so.
"The primary-jurisdiction rationale unquestionably requires that when the same controversy may be presented to the state court or the NLRB, it must be presented to the Board. But that rationale does not extend to cases in which an employer has no acceptable method of invoking, or inducing the Union to invoke, the jurisdiction of the Board. We are therefore persuaded that the primary-jurisdiction rationale does not provide a sufficient justification for pre-empting state jurisdiction over arguably protected conduct when the party who could have presented the protection issue to the Board has not done so and the other party to the dispute has no acceptable means of doing so.” Sears, supra, 201, 202-203. (Emphasis in original, footnotes omitted.)

This said, the Court immediately placed a strong limitation on this new exception:

"This conclusion does not, however, necessarily foreclose the possibility that pre-emption may be appropriate. The danger of state interference with federally protected conduct is the principal concern of the second branch of the Garmon doctrine. To allow the exercise of state jurisdiction in certain contexts might create a significant risk of misinterpretation of federal law and the consequent prohibition of protected conduct. In those circumstances, it might be reasonable to infer that Congress preferred the costs inherent in a jurisdictional hiatus to the frustration of national labor policy which might accompany the exercise of state jurisdiction. Thus, the acceptability of 'arguable protection’ as a justification for pre-emption in a given class of cases is, at least in part, a function of the strength of the argument that § 7 does in fact protect the disputed conduct.” Sears, supra, 203.

The result of this language would appear to be that when the case for § 7 protection is a strong one state court jurisdiction is preempted even when the party aggrieved by the conduct is, practically speaking, unable to take the case to the board instead. Analyzing the union’s conduct in the Sears case in light of this standard, the Court concluded that, since experience showed the claim of protection to be a weak one, state court jurisdiction was not preempted.

Ill

In applying the preemption doctrine to the facts of the instant case, we must concentrate on the activities of the union. While Morgan’s actions were certainly of a violent and tortious, even criminal, nature, there is no claim that, in assaulting Bescoe, Morgan was in some manner acting on behalf of the laborers’ union. Morgan was simply a dues paying member of the union, not an officer, agent, or steward.

Plaintiffs’ theory of the case, as stated to the jury during the trial court’s instructions, was as follows:

"It is the theory of the plaintiff’s case that Defendant Howard Morgan was referred to the job for the Serstel Company as the foreman; that after he was sent to this job, he made threats of violence against the superintendent, Charles Larimer. Larimer then attempted to fire Morgan and called the union business manager in attempting to do so. The union sent out its business agent, who told Larimer that he could not fire Morgan and that Morgan must remain on the job as foreman, even though the agreement between the union and the company provided that only the company had the right to hire or fire foremen.
"In addition, the plaintiff’s theory goes on and says that on at least three occasions Larimer tried to fire Morgan. Each time he was visited by a union business agent, who told Larimer that the union would 'take care of Morgan.’ It is the theory of plaintiff’s case that this promising to 'take care of Morgan’ made the union liable for Morgan’s actions; further, that the union is responsible in certain situations for the acts of its members and that this promise from the union through its business agent or representative made the union responsible and liable for damages caused by Morgan.
"Further, the plaintiff’s theory is that it was the duty of the union, once it was informed of Morgan’s threats of violence, to take whatever action was necessary of a prudent union to insure or protect fellow workmen from injury caused by actions of violence of Morgan; and that the union breached that duty by forcing Serstel to not only keep Morgan on the job, but to keep him in a position of authority, a position to which he was not entitled, and that the plaintiff’s injury is a proximate result of that breach.”

On the basis of this theory, the trial court sent the case to the jury on general negligence instructions.

The trial court’s recitation of plaintiffs’ theory appears to focus on three sorts of union activity: (1) union efforts to prevent Serstel from firing Morgan; (2) the statement of a union agent that he would "take care of Morgan”, which, it is argued, makes the union liable for Morgan’s acts, and (3) the union’s failure to insure and protect other workers on the site once it had been informed of Morgan’s threats of violence. We do not believe that the conduct alleged in the third area is preempted by Federal labor law. As it is stated in a negative, it does not involve affirmative activity that could be said to be protected by § 7 of the act. Neither does the failure to insure and protect appear to be prohibited by § 8. While not preempted, the question of whether there exists such a duty to insure and protect, the breach of which would result in the union’s liability, will be discussed in § IV of this opinion, infra. We hold, however, that the preemption doctrine deprived the trial court of subject matter jurisdiction over the first two areas of union activity.

Our inquiry begins with the issue of whether the activities of the union are arguably protected under § 7 or arguably prohibited under § 8 of the act. Our examination of § 8 reveals no basis for holding that any of these activities are prohibited by the act, and plaintiffs have not suggested otherwise. Our analysis will, accordingly, proceed to the question of whether the activities are protected under §7.

Section 7 is a short, yet broad, statement of the rights of employees in the formation of labor unions and in concerted activity. It provides:_

"Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 158(a)(3) of this title.” 29 USC 157.

It appears to us that the activity complained of in the first two areas above are clearly protected. Essentially, plaintiffs complain of the union’s peaceful efforts to intercede on behalf of a fellow employee who had managed to get himself into trouble. This is precisely the sort of conduct that is expected of labor unions. While the agent of the union may have told the employer that it "couldn’t” fire Morgan, or that it would "take care” of Morgan, such statements do not serve to remove such activity from Federal protection. Indeed, the record reflects that such efforts usually proved successful, even if only for the moment. It is undisputed that each time the union was called to the work site in response to a problem concerning Morgan the agent would speak with the representative of the employer and with Morgan and that tensions would ease. The national labor policy as expressed in the act and in the decisions of the board clearly supports the view that unions are protected when they intercede on behalf of an employee in circumstances such as those before us now. Our conclusion in this regard is bolstered by the fact that had the union not acted as it did, it would have most likely been guilty of an unfair labor practice under § 8.

Our inquiry does not end here, as Sears has created an exception to the preemption doctrine in cases where the activity involved is arguably protected. As noted above, that exception holds that, where an aggrieved party is not able to present the protection issue to the board and also unable to induce the party who could to do so, state court jurisdiction is not preempted. While the factual circumstances of the instant case are not directly in point as we do not perceive how either Bescoe or the union could have presented the protection issue to the board, the concerns raised in Sears are as a result raised here to perhaps an even greater extent. As was also noted above, however, this exception is a narrow one and the greater the argument for § 7 protection the greater the chance that preemption will apply even if it means that a party’s claims have no forum. We believe that such an analysis, applied to the instant case, results in the preemption of state court jurisdiction over plaintiffs’ claims to the extent that those claims are based on the union’s efforts, in this case, to preserve Morgan’s job.

The rationale of this analysis, as clearly stated by the Supreme Court in Sears, is that when conduct is protected by Federal law the possibility of state regulation that would cut back on such protection must be eliminated. This would be the result in the instant case if jurisdiction were upheld. If the union’s peaceful intercession on behalf of Morgan were held wrongful, as it in essence was in the instant case, the State of Michigan would be holding unlawful that which is protected by Federal law and informing the union that it should instead have engaged in conduct that would most likely have violated § 8 of the act. The claim that such a holding would leave plaintiffs without a forum is minimized by the fact that the strength of the protection points to the improbability of the recognition of a duty in tort to refrain from such conduct and the improbability of plaintiffs obtaining a remedy for the allegedly wrongful activity in any forum.

Plaintiffs argue that as the protection asserted by the union in the instant case regards the duty of fair representation, which stems from the principle of exclusive representation as found in § 9 of the act, the conduct is not under §§ 7 or 8 and their suit is not preempted. Plaintiffs also note that suits by a union member against his or her union for breach of the duty of fair representation are maintainable in state and Federal court. Vaca v Sipes, supra. This argument does not help plaintiffs for two reasons. First, while the duty of fair representation evolved in full form from the exclusive representation principle of § 9, a union, while engaged in the fair representation of its members, is also engaged in activity protected under § 7. While an alleged breach of the duty may be heard in state court, it may also be brought before the board as an unfair labor practice. Second, even in cases where the facts suggest the duty may have actually been breached, preemption has been held to apply unless the suit has been specifically put forth and argued as a suit for the breach of the duty of fair representation. Amalgamated Ass’n of Motor Coach Employees v Lockridge, 403 US 274, 299-300; 91 S Ct 1909; 29 L Ed 2d 473 (1971), Bebensee v Ross Pierce Electric, Inc, 400 Mich 233; 253 NW2d 633 (1977). The exception in Vaca was developed in response to the practical difficulties which faced an employee seeking to redress claims against his or her union. We do not believe it was meant to apply to every case in which the duty of fair representation is in some manner involved, especially to cases where it can only be said the duty was scrupulously adhered to.

We should not be understood as holding that persons in the position of plaintiff are always precluded from recovering against a union. Had plaintiff been able to plead and prove willful misconduct on the part of the defendant union that did not enjoy Federal protection, preemption might well not apply under the exceptions enunciated in Linn and Garmon. That question is not, however, presently before us.

IV

The only allegation not preempted and thus properly before the trial court is plaintiffs’ theory that the union had a duty to take whatever steps were necessary to insure and protect workers on the job site once it learned of Morgan’s threats of violence. Whether such a duty exists is a question of state law.

In support of their argument for such a duty, plaintiffs cite 2 Restatement Torts, 2d, § 324A, p 142. Under this section of the Restatement a party (the union) may be liable to a third party (Bescoe) when it has undertaken to perform a duty owed by another (Serstel and Great Lakes) to the third party and has failed to exercise reasonable care with physical harm resulting to the third party. In the context of the instant case, plaintiffs argue that the union undertook at least partial performance of the employer’s duty to provide a safe work place, and that it failed to exercise reasonable care in discharging this duty resulting in Bescoe’s injuries.

Section 324A has been adopted in Michigan and applied in cases where it is argued that an insurance carrier has undertaken the duty to inspect an employer’s premises, and has negligently carried out such a duty with injury resulting to an employee. See Smith v Allendale Mutual Ins Co, 79 Mich App 351; 261 NW2d 561 (1977), lv gtd 406 Mich 969 (1979), Watson v Employers’ Ins Co of Wausau, 50 Mich App 597; 213 NW2d 765 (1973), Ray v Transamerica Ins Co, 46 Mich App 647; 208 NW2d 610 (1973). While the question of whether a party has undertaken a duty for another is one of fact and is, as such, for the jury, Ray, supra, 654, there must be evidence that the union actively undertook the employer’s duty to provide a safe work place as regards Morgan. Smith, supra, 356, Ray, supra, 654. The evidence must show that the employer relinquished control over this aspect of its operation in favor of the union; Watson, supra, 601-602.

We believe this analysis reveals no duty on the part of the union in the instant case. Nothing in the record can lead to the conclusion that Serstel relinquished its right to fire Morgan. Certainly the union did not have this authority. The fact that the union successfully bargained with Serstel in keeping Morgan from being fired does not place responsibility for his acts on the shoulders of the union. If Morgan’s presence on Zug Island created an unreasonable risk of harm to his fellow employees such that he should have been removed from the work site, then it was incumbent on his employer to see to it. The premises continued to be maintained by Great Lakes which through the means of a security force controlled access to the island. The union could not have fired Morgan nor unilaterally prevented his presence at the work place. There being insufficient evidence to support a duty on the part of the union to insure and protect the workers at the job site, the trial court’s judgment cannot be supported on this theory.

V

The judgment of the trial court is reversed and this cause is remanded for entry of judgment notwithstanding the verdict.

Reversed.

       Suit was originally brought against Morgan, Serstel, Great Lakes, the International Laborers’ Union, and Local 334. Serstel was granted accelerated judgment, the International Union was dismissed by stipulation, and Great Lakes was granted a directed verdict at the close of plaintiffs’ case. Judgment was taken against Morgan and Local 334, and the local alone has appealed.

       Article VIII of the collective bargaining agreement between Local 334 and the Detroit Chapter of the Associated General Contractors of America (to which Serstel was bound) gave Serstel the right to select the foreman from those workers referred by the union, and the foreman became the representative of the company. Morgan was not an employee or agent of the union. Although the union referred Morgan for the foreman’s position, the company was not bound to accept him as such.

      Serstel did have the authority to fire any worker, including Morgan.

       On the issue of Federal labor law preemption, see generally Bartosic & Hartley, Labor Relations Law in the Private Sector, pp 25-31, Gorman, Basic Text on Labor Law Unionization and Collective Bargaining, pp 766-786.

       29 USC 157.

       29 USC 158.

       There has developed also a separate strand of preemption that applies specifically when the activity in question is neither protected nor prohibited under §§ 7 or 8 of the act. Sometimes referred to as "permitted” activity, this strand of the doctrine forbids state regulation of the economic weapons that may be brought to bear in a labor dispute on the theory that Congress intended to allow the use of such tactics. See New York Telephone Co v New York State Dep’t of Labor, 440 US 519; 99 S Ct 1328; 59 L Ed 2d 553 (1979), Lodge 76, International Ass’n of Machinists and Aerospace Workers, AFL-CIO v Wisconsin Employment Relations Comm, 427 US 132; 96 S Ct 2548; 49 L Ed 2d 396 (1976), Local 20, Teamsters, Chauffeurs & Helpers Union v Morton, 377 US 252; 84 S Ct 1253; 12 L Ed 2d 280 (1964).

       "Regardless of the mode adopted, to allow the States to control which is the subject of national regulation would create potential frustration of national purposes.” Garmon, supra, 244.
      "Nor is it significant that California asserted its power to give damages rather than to enjoin what the Board may restrain though it could not compensate. Our concern is with delimiting areas of conduct which must be free from state regulation if national policy is to be left unhampered. Such regulation can be as effectively exerted through an award of damages as through some form of preventive relief. The obligation to pay compensation can be, indeed is designed to be, a potent method of governing conduct and controlling policy. Even the States’ salutary effort to redress private wrongs or grant compensation for past harm cannot be exerted to regulate activities that are potentially subject to the exclusive federal regulatory scheme.” Garmon, supra, 246-247.

       29 USC 187.

       29 USC 185.

       29 USC 164(c)(2).

         "[T]he Labor Management Relations Act 'leaves much to the states, though Congress has refrained from telling us how much.’ ” Weber v Anheuser-Busch, Inc, 348 US 468, 480; 75 S Ct 480; 99 L Ed 546 (1955), quoting Garner v Teamsters Local Union No 776, 346 US 485, 488; 74 S Ct 161; 98 L Ed 228 (1953).
      "A second factor that has played an important role in our shaping of the pre-emption doctrine has been the necessity to act without specific congressional direction. The precise extent to which state law must be displaced to achieve those unifying ends sought by the national legislature has never been determined by the Congress. * * * We cannot declare pre-empted all local regulation that touches or concerns in any way the complex interrelationships between employees, employers, and unions; obviously, much of this is left to the States.” Amalgamated Ass’n of Motor Coach Employees of America v Lockridge, 403 US 274, 289; 91 S Ct 1909; 29 L Ed 2d 473 (1971).

        Miranda Fuel Co, Inc, 140 NLRB 181 (1962), enforcement denied 326 F2d 172 (CA 2, 1963). But see, Rubber Workers Local 12 v National Labor Relations Board, 368 F2d 12 (CA 5, 1966), cert den 389 US 837; 88 S Ct 53; 19 L Ed 2d 99 (1967), Truck Drivers and Helpers Local Union 568 v National Labor Relations Board, 126 App DC 360; 379 F2d 137 (1967).

         Violence and threats of violence have often been cited as the classic examples of such conduct. Garmon, supra, 247-248, International Union, United Automobile Workers of America v Russell, 356 US 634; 78 S Ct 932; 2 L Ed 2d 1030 (1958), Youngdahl v Rainfair, Inc, 355 US 131; 78 S Ct 206; 2 L Ed 2d 151 (1957), United Construction Workers v Laburnum Construction Corp, 347 US 656; 74 S Ct 833; 98 L Ed 1025 (1954).

       This approach had, however, been previously rejected as unsatisfactory:
      "Finally, treating differently judicial power to deal with conduct protected by the Act from that prohibited by it would likewise be unsatisfactory. Both areas equally involve conduct whose legality is governed by federal law, the application of which Congress committed to the Board, not courts.” (Footnote omitted.) Amalgamated Ass’n of Motor Coach Employees v Lockridge, 403 US 274, 290; 91 S Ct 1909; 29 L Ed 2d 473 (1971).
      The above-quoted language was apparently made in response to the dissent in Lockridge by Justice White, who argued for differing standards based on the difficulty of presenting to the board the issue of whether certain conduct is protected under the act. As is discussed in text, infra, similar concerns seem to have played a role in the
        Sears Court’s decision to treat the issues of prohibition and protection in different manners.

       Plaintiffs’ theory also makes much of the union’s referral of Morgan to Serstel, particularly his referral as foreman. The union had been granted partial summary judgment on the issue of negligent referral, however, and no appeal was taken from that ruling, so that the referral itself was not part of the case as it went to the jury.

       29 USC 159.

       See note 12, supra.

       "One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to protect his undertaking, if
      "(a) his failure to exercise reasonable care increases the risk of such harm, or
      "(b) he has undertaken to perform a duty owed by the other to the third person, or
      "(c) the harm is suffered because of reliance of the other or the third person upon the undertaking.”

       At least as to worker’s compensation insurers, the rule has been abrogated. MCL 418.131; MSA 17.237(131), MCL 418.827(8); MSA 17.237(827X8), see Shwary v Cranetrol Corp, 88 Mich App 264; 276 NW2d 882 (1979), lv den 406 Mich 979 (1979).


author: Bashara, J.

text:
    ROBARDS v ESTATE OF LEOPOLD J KANTZLER
    Docket No. 78-4072.
    Submitted March 11, 1980, at Lansing.
    Decided July 1, 1980.
    Willard Robards, hereinafter plaintiff, was employed at International Mill & Timber Co., a closely held corporation whose sole officer and shareholder was Leopold J. Kantzler, since deceased. Plaintiff was severely injured when his hand became ensnared in a machine he was operating while in the course of his employment. This machine was personally owned by Mr. Kantzler and leased to the corporation. Following the accident, plaintiff began receiving workmen’s compensation benefits from the company’s insurer. Subsequently, plaintiff filed a products liability action in Bay Circuit Court against the estate of Leopold J. Kantzler, hereinafter defendant, claiming the machine lacked adequate safety devices and warnings. Defendant moved for accelerated judgment claiming that plaintiff’s action was barred by the Workmen’s Compensation Act. Leon R. Dardas, J., granted accelerated judgment to defendant, holding that the plaintiff’s exclusive remedy v/as under the workmen’s compensation act. Plaintiff appeals. Held:

    1. A court must accept well-pleaded facts of the nonmoving party as true for purposes of a motion for accelerated judgment.
    2. A corporate entity will be disregarded only where fraud, sham or other improper use of the corporate form is established.
    3. The "dual capacity doctrine” of the workmen’s compensation law permits an employee to state a claim against an employer where the employer occupies a second capacity that confers upon him obligations independent of those imposed on him as the employer.
    4. The coemployee immunity provision of the workmen’s compensation law requires that both employees must be acting in the course of their employment at the time the injury occurred.

      References for Points in Headnotes

       73 Am Jur 2d, Summary Judgment §§ 26, 27.

       18 Am Jur 2d, Corporations §§ 14,15.

       81 Am Jur 2d, Workmen’s Compensation § 50 et seq.

       81 Am Jur 2d, Workmen’s Compensation § 67.
    Right to maintain action against fellow employee for injury or death covered by workmen’s compensation. 21 ALR3d 845.

      5. The leasing of a machine by an employee to the employer corporation does not constitute “acting in the course of employment” and the employee leasing the machine is subject to the same liabilities for injuries to a coemployee as any lessor who provides an allegedly defective product.
    6. The Workmen’s Compensation Act does not bar the plaintiffs claim against the defendant.
    Reversed and remanded.
    1. Motions and Orders — Accelerated Judgments.
    A court must accept well-pleaded facts of the nonmoving party as true for purposes of a motion for accelerated judgment.
    2. Corporations — Piercing the Corporate Veil.
    A corporate entity will be disregarded only where fraud, sham or other improper use of the corporate form is established.
    3. Worker’s Compensation — Dual Capacity Doctrine.
    The “dual capacity doctrine” of the Workmen’s Compensation Act permits an employee to state a claim against an employer where the employer occupies a second capacity that confers upon him obligations independent of those imposed on him as the employer.
    4. Worker’s Compensation — Immunity — Co-Employees — Statutes.
    The coemployee immunity provision of the Workmen’s Compensation Act requires that both employees must be acting in the course of their employment at the time the injury occurred (MCL 418.827[1]; MSA 17.237[827][1]).
    5. Corporations — Employees — Leasing — Defective Machine — Liability.
    The leasing of a machine by an employee to the employer corporation does not constitute "acting in the course of employment” and the employee leasing the machine is subject to the same liabilities for injuries to a coemployee as any lessor who provides an allegedly defective product.

      James S. Miner, II, for plaintiff.

      Learman, Peters & Sarow (by John J. Mc-Quillan), for defendant.
    Before: Mackenzie, P.J., and Bashara and D. C. Riley, JJ.
   Bashara, J.

This case presents an issue of first impression in this state. Does the dual capacity doctrine permit an employee, injured in the course of his employment by a machine leased to the employer by a fellow employee, to state a claim otherwise barred by the exclusive remedy and coemployee immunity provisions of the Workmen’s Compensation Act (hereinafter the Act)? MCL 418.131; MSA 17.237(131), MCL 418.827; MSA 17.237(827). The trial court held that plaintiff-employee’s exclusive remedy was under the Act and granted accelerated judgment in favor of defendant. GCR 1963, 116.1(5).

The court must accept well-pleaded facts of the nonmoving party as true for purposes of a motion for accelerated judgment. Empire Shoe Service, Inc v Gershenson, 62 Mich App 221, 224; 233 NW2d 237 (1975). Our review of the pleadings indicate that plaintiff was employed at International Mill & Timber Co. The company was a closely held corporation whose sole officer and shareholder was Leopold J. Kantzler, since deceased. While plaintiff was in the course of his employment, he was severely injured when his hand became ensnared in a machine which he was operating. This machine was personally owned by Mr. Kantzler and leased to the corporation.

As a result of the accident, plaintiff began receiving workmen’s compensation benefits from the company’s insurer. Plaintiff filed this products liability action against Mr. Kantzler’s estate, claiming the machine lacked adequate safety devices and warnings.

Defendant immediately moved for accelerated judgment on the grounds that plaintiffs action was barred by the Act. Defendant argued that since Mr. Kantzler was plaintiff’s employer and coemployee, the exclusive remedy and coemployee immunity provisions of the Act precluded plaintiff from maintaining this suit.

Plaintiff argues that he was not suing Mr. Kantzler in his capacity as employer but rather in his capacity as individual owner and lessor of the machine. Plaintiff claimed that, as an individual, Mr. Kantzler stood in the shoes of a third party and was therefore liable under the Act. The trial judge ruled that individual ownership did not provide an independent basis of liability. We find that neither MCL 418.131; MSA 17.237(131) nor MCL 418.827(1); MSA 17.237(827)(1) precludes plaintiffs action and, accordingly, reverse.

Section 131 provides:

"The right to the recovery of benefits as provided in this act shall be the employee’s exclusive remedy against the employer.” MCL 418.131; MSA 17.237(131).

In order for § 131 to bar plaintiffs action, the lower court must have determined that Mr. Kantzler was plaintiff’s employer. The record clearly establishes that plaintiffs employer was International Mill & Timber Co. The corporation was a distinct legal entity from Leopold Kantzler as an individual. A contrary finding would require us to "pierce the corporate veil”. Only where fraud, sham or other improper use of the corporate form is established will the corporate entity be disregarded. Williams v American Title Ins Co, 83 Mich App 686; 269 NW2d 481 (1978); 7 Michigan Law & Practice, Corporations, § 5, p 19. We find that the ends of justice will not be served by disregarding the corporate entity in order to shield defendant from liability.

Essentially, plaintiffs argument is based on the "dual capacity doctrine”. This principle permits an employee to state a claim against an employer where the employer occupies a second capacity that confers upon him obligations independent of those imposed on him as employer. See 2A Larson, The Law of Workmen’s Compensation, § 72.80, p 14-112. Professor Larson states:

"The decisive dual-capacity test is not concerned with how separate or different the second function of the employer is from the first but with whether the second function generates obligations unrelated to those flowing from the first, that of employer.” 2A Larson, supra, § 72.80, p 14-117.

As lessor of a machine, defendant undertook obligations unrelated to those as an employer, including the duty to warrant and provide a machine reasonably safe for its intended or foreseeable use. See Jones v Keetch, 388 Mich 164; 200 NW2d 227 (1972).

Support in Michigan for the dual capacity doctrine is found in the recent Supreme Court opinion in Mathis v Interstate Motor Freight System, 408 Mich 164; 289 NW2d 708 (1980). In holding that an employee could recover no-fault benefits from his employer who was self-insured under the Michigan no-fault insurance act, MCL 500.3101 et seq.; MSA 24.13101 et seq., the Court stated:

"An employee may have ties with an employer other than the employer-employee relationship. They may be landlord and tenant; trustee and beneficiary; vendor and vendee and so on. We look to the laws governing the particular relationship involved to determine rights and obligations of the parties. The fact that the parties are also employer-employee does not automatically trigger the operation of the exclusive remedy provision of the WDCA. The exclusive remedy provision applies only to employers where conditions of liability under the WDCA pertain.” Mathis, supra, 184.

Notwithstanding § 131, defendant asserts that since Mr. Kantzler was plaintiffs coemployee, § 827(1) bars plaintiffs action. Section 827(1) provides:

"Where the injury for which compensation is payable under this act was caused under circumstances creating a legal liability in some person other than a natural person in the same employ or the employer to pay damages in respect thereof, the acceptance of compensation benefits or the taking of proceedings to enforce compensation payments shall not act as an election of remedies but the injured employee or his dependents or personal representative may also proceed to enforce the liability of the third party for damages in accordance with the provisions of this section.” MCL 418.827(1); MSA 17.237(827)(1).

It is undisputed that at the time of the accident, Mr. Kantzler was "a natural person in the same employ” as plaintiff. However, judicial interpretation of § 827 has added the requirement that both employees must be acting in the course of their employment at the time the injury occurred. Dixon v Sype, 92 Mich App 144; 284 NW2d 514 (1979), Wilson v Al-Huribi, 55 Mich App 95; 222 NW2d 49 (1974).

We find that in leasing a machine to the corporation which he controlled, Mr. Kantzler was not acting in the course of his employment. The machine could have been purchased from any third person or contributed as capital by Mr. Kantzler. Instead, it is claimed that Mr. Kantzler leased the machine to the corporation. In this posture, he is subject to the same liabilities as any lessor who provides an allegedly defective product. Jones v Keetch, supra; Webb v Travelers Ins Co, 98 Mich App 157; 296 NW2d 216 (1980).

Although our research has disclosed no Michigan cases directly on point, we find the New York case of Costanzo v Mackler, 34 Misc 2d 188; 227 NYS2d 750 (1962), is remarkably similar to the instant case. Constanzo dealt with the coemployee immunity provision of the New York Workmen’s Compensation Act. Defendant, a coemployee, leased trucks to his employer. Plaintiff, another employee, was injured due to a defect which existed in one of the trucks. His injury occurred in the course of his employment. The Court held that defendant’s act of leasing the truck to his employer was "independent of, and not related to, the common employment of both * * 227 NYS2d 750, 751.

We conclude that plaintiff’s claim is not barred by the Act and, therefore, remand for trial. On remand, since the factual issue remains whether a bona fide lease agreement existed between Mr. Kantzler and the company, we emphasize that we have not decided whether plaintiff’s claim is meritorious, only that he has pled one. Szydlowski v General Motors Corp, 59 Mich App 180; 229 NW2d 365 (1975).

Reversed and remanded.