STATE OF MICHIGAN RETAIL COMPENDIUM OF LAW

Prepared by Kenneth M. Alweis

Heather K. Zimmerman Goldberg Segalla LLP

Email: kalweis@goldbergsegalla.com hzimmerman@goldbergsegalla.com

www.goldbergsegalla.com

2014 USLAW Retail Law Compendium

Retail, Restaurant, and Hospitality

Guide to Michigan Premises Liability

Introduction 1

A. The Michigan State Court System 2

B. Michigan Federal Courts 2

Negligence 3

A. General Negligence Principles 3

B. Who Can Be Held Liable in a Premises Liability Case? 3

C. Elements of a Premises Liability Negligence Action 4

1. Duty Owed 4

2. Breach of the Duty 4

D. The “Open and Obvious” Doctrine 6

E. Assumption of Risk 6

Examples of Negligence Claims 9

A. “Slip and Fall” Type Cases 9

1. Accumulation of Snow and Ice 9

2. “Black Ice” 10

3. Snow Removal Contractors 11

4. Slippery Surfaces – Cleaner, Polish and Wax 11

5. Defenses 11

a. Plaintiff Failed to Establish the Existence of Dangerous

condition 12

b. Trivial Defects 13

c. Open and Obvious Doctrine 13

B. Liability for Violent Crime 15

1. Condition of Liability 15

2. Security Contractors 16

C. Claims Arising From the Wrongful Prevention of Thefts 18

1. False Arrest and Imprisonment 18

2. Malicious Prosecution 19

3. Defamation 19

4. Negligent Hiring, Retention, or Supervision of Employees 20

D. Food Poisoning 21

Indemnification and Insurance-Procurement Agreements 22

A. Indemnification 22

B. Insurance Procurement Agreements 23

C. The Duty to Defend 23

Damages in Premises Liability Cases 24

A. Damages Overview 24

B. Compensatory Damages 24

C. Exemplary and Punitive Damages 26

D. Nominal Damages 27

E. Wrongful Death 28

Retail, Hospitality, and Development Practice Group 30

1

Introduction

Retail stores, restaurants, hotels, and shopping centers have, by and large, become the

principal gathering places of our communities. With that evolution comes exposure to all kinds of

liabilities, especially for owners, occupants, or other persons or entities in control of the property

to which people gather. Each time a person sets foot on the premises, owners and managers

become exposed to an ever-increasing number of liabilities—many of which could significantly

harm their businesses if a claim is successful. It is therefore crucial for the owners, occupants, or

other persons or entities in control of those properties to have a working understanding of

common legal issues regarding premises liability and how they impact these industries

specifically.

Michigan, like many states, has its own unique legal structure, theories, and statutes.

With that in mind, we have included a brief overview of the Michigan legal system below, and at

the end of each section, we have included a checklist of recommendations and considerations for

addressing the specific types of claims presented.

We hope the following serves as an easy-to-use reference guide to these issues and

provides practical tips to help those in the retail, hospitality, hotel, and food industries prevent or

defend against premises liability claims.

If you have any questions about the material covered in this guide, please contact one of

the authors listed below or another member of Goldberg Segalla’s Retail, Hospitality, and

Development Practice Group.

Kenneth M. Alweis Heather K. Zimmerman

Goldberg Segalla LLP Email: kalweis@goldbergsegalla.com hzimmerman@goldbergsegalla.com

www.goldbergsegalla.com

2

A. The Michigan State Court System

The trial-level court in Michigan is the Circuit Court. The 57 Circuit Courts throughout

the state hear all manners of civil disputes valued over $25,000. Thus, virtually all personal injury

actions filed in state court are filed in the Circuit Courts. Circuit Court judges are elected officials

and serve six-year terms.

The intermediate appellate-level court is the Michigan Court of Appeals. Judges of the

Court of Appeals are elected from four districts statewide. The judges then sit in panels of three in

one of three different Court of Appeals locations (Detroit, Grand Rapids, or Lansing) to decide

appeals. The judges of the Court of Appeals decide appeals from all of the 57 Circuit Courts

throughout the state. The Michigan Court of Appeals is therefore one of the highest volume

appellate courts in the United States.

The Supreme Court is the highest-level appellate court in the state of Michigan. It is

located in Lansing, and it primarily hears appeals from the Court of Appeals. The seven justices

of the Michigan Supreme Court are elected to eight-year terms.

The procedural rules in Michigan state courts are the Michigan Court Rules of 1985.

These rules differ in many ways from federal court practice.

B. Michigan Federal Courts

Michigan federal courts are organized slightly differently. There are two judicial districts

within the state. The Eastern District encompasses Detroit, Ann Arbor, Bay City, Flint, Port

Huron, and surrounding areas. The Western District includes Grand Rapids, Lansing, Kalamazoo,

Marquette, and surrounding areas. These District Courts are trial-level courts. The intermediate

appellate level is the Sixth Circuit Court of Appeals, which hears appeals from all of the District

Courts located in Kentucky, Michigan, Ohio, and Tennessee. The highest appellate level is, of

course, the Supreme Court of the United States.

U

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Negligence

A. General Negligence Principles

By definition, negligence is “the failure to use that amount of care that a reasonably

prudent person would use under the circumstances.”1 It arises from a breach of a duty owed by

one to another. As a result, a claim for damages cannot arise unless there is a relationship

sufficient to give rise to a legal duty.

B. Who Can Be Held Liable in a Premises Liability Case?

In the context of a premises liability case, liability does not turn on title to premises

alone; it may be imposed upon any “possessor” of a premises who has control over the premises.

Potential possessors are parties occupying the premises with intent to control them; parties who

have previously occupied the premises with intent to control them, so long as no other party has

subsequently occupied them with intent to control them; and parties who are entitled to

immediate occupation of the premises, if no other party is in possession as described above.2

Parties that fit the description of a possessor could include property owners, lessors, and lessees.

Under most commercial leases, responsibility for the interior of a leased space is the

responsibility of the tenant, while the landlord is absent from the space itself. Though the

description of the term “possessor” above might lead one to believe it would be impossible to

impose liability on an absent landlord, there are instances in which even an absent landlord can be

held liable for injuries sustained on leased property. For example, a landlord may be held liable

for injuries sustained as the result of an unsafe condition existing on the leased property if the

landlord knew of the unsafe condition at the time of the lease.3 Similarly, an absent landlord can

be held liable for injuries on the leased premises is if the landlord has retained some control over

the premises or is contractually obligated to repair or maintain the premises.”4

1 Frederick v. Detroit, 370 Mich. 425, 428 (1963).

2 See Nezworski v. Mazanec, 301 Mich. 43, 56 (1942); Derbabian v. Mariner's Pointe Assocs. L. P., 249

Mich. App. 695, 702-03 (Mich. Ct. App. 2002); MICHIGAN MODEL CIVIL JURY INSTRUCTIONS § 19.02

(2014). 3 Bluemer v. Saginaw Cent. Oil & Gas Service, Inc., 356 Mich. 399, 414 (1959); Wallington v. Carry, 80

Mich. App. 248, 250 (Mich. Ct. App. 1977). 4 Bailey v. Schaaf, 494 Mich. 595, 599 (2013).

4

C. Elements of a Premises Liability Negligence Action

To establish a prima facie case of negligence in a premises liability action—that is, one

that “at first blush” presents evidence sufficient to prove the case—a plaintiff must show the

property possessor had a duty towards him, the possesor breached that duty, and the breach

proximately caused him harm.

1. Duty Owed

A premises liability plaintiff must first establish what duty the defendant property

possessor owed to him. There are three types of plaintiffs, each of which is owed a different

duty—that is, a different level of care—by a possessor.

An “invitee” is a person who is invited to enter or remain on a premises for a commercial

benefit to the possessor of the premises or for a purpose directly or indirectly connected with

business dealings with the possessor.5 An invitation for a business purpose may be either express

or implied.6 An invitee is owed the highest duty of care—a landowner must not only warn the

invitee of any known dangers, but also inspect the premises and, depending upon the

circumstances, make any necessary repairs or warn of any discovered hazards.7

A “licensee” is a person who is invited to enter or remain on a premises for any purpose

other than a business or commercial one with the express or implied permission of the owner or

person in control of the premises.8 For example, a social guest is a licensee, not an invitee,

because, while he was invited to the premises, he was invited for a non-business purpose. A

landowner has a duty to warn a licensee of any hidden dangers the owner knows or has reason to

know of, if the licensee does not know or have reason to know of the danger. The landowner

owes no duty to affirmatively inspect the premises or make it safe for the licensees visit.9

A “trespasser” is a person who enters the premises of another without an express or

implied invitation, for his or her own purposes, and not in the performance of any duty to the

owner.10

It is not necessary that in making such an entry the trespasser have an unlawful intent—

merely that he enter the premises without any invitation or permission to do so. A trespasser is

owed no duty of care other than a duty to refrain from injuring him by “wilful and wanton”

5 James v. Alberts, 464 Mich. 12, 19 (2001); Stitt v. Holland Abundant Life Fellowship, 462 Mich. 591,

596 (2000). 6 Riddle v. McLouth Steel Prods. Corp., 440 Mich. 85, 91 n.4 (1992).

7 James, 464 Mich. at 19; Stitt, 462 Mich. at 596.

8 James, 464 Mich. at 19; Stitt, 462 Mich. at 596.

9 James, 464 Mich. at 19; Stitt, 462 Mich. at 596.

10 James, 464 Mich. at 19; Stitt, 462 Mich. at 596.

5

misconduct.11

However, after a premises possessor of becomes aware of the presence of a

trespasser, or if in the exercise of ordinary care the possessor should have known of the

trespasser’s presence, the possessor is bound to use ordinary care to prevent injury to the

trespasser arising from active negligence.12

2. Breach of the Duty

There are a few different ways in which a duty toward a premises liability plaintiff may

be breached: 1) if the defendant affirmatively created the dangerous or defective condition which

caused the plaintiff’s injury; 2) the defendant had actual or constructive notice of the dangerous

condition, but failed to remedy it; 3) the defendant failed to warn the plaintiff of the dangerous

condition.

First, liability may be imposed where the property possessor actually creates the

dangerous condition that led to the plaintiff’s injuries. For instance, the application of a polish,

paint, cleaner, or wax to a floor which makes it dangerously slippery may result in a finding of

negligence. In short, a landowner can create a dangerous condition in a variety of different ways,

a few of which are discussed in further detail below.

Second, even if a property possessor did not affirmatively create a condition, he can be

liable for injuries caused by the condition if he knew of it (or, generally if the plaintiff is either an

invitee or licensee, the possessor should have known of it) and failed to remedy it. In such

instances, a plaintiff must allege the property possessor had notice of the dangerous condition—it

is not enough merely to allege that a danger existed.13

The plaintiff may allege either actual or constructive notice. The plaintiff can establish

actual notice if he can show the property possessor was actually aware of the dangerous condition

through, for example, a complaint about the dangerous condition or a prior accident involving the

dangerous condition. Before evidence of prior accidents or a lack of prior accidents may be used

as evidence in court, the party offering the evidence must establish that the conditions giving rise

to the accident at issue were the same as those that existed either at the time of the prior accidents

or for an extended period of time prior to the accident at issue.14

The plaintiff can establish constructive notice if he can show the dangerous condition was

visible and apparent and existed for a sufficient length of time to allow a defendant, in the

11

James, 464 Mich. at 19; Stitt, 462 Mich. at 596. 12

Schulke v. Krawczak, 62 Mich. App. 675, 677 (Mich. Ct. App. 1975). 13

Kroll v. Katz, 374 Mich. 364, 373 (1965); Bradley v. Burdick Hotel Co., 306 Mich 600, 604 (1943);

McCord v. United States Gypsum Co., 5 Mich. App. 126, 130 (Mich. Ct. App. 1966). 14

Freed v. Simon, 370 Mich. 473, 475 (1963).

6

exercise of reasonable care, to have discovered and remedied the condition.15

If there is no

evidence as to how long the condition existed prior to the accident, constructive notice cannot be

established.16

Third, if a property possessor knows or should know of a dangerous condition, he has a

duty to warn both invitees and licensees of its presence and the danger it poses.17

D. The “Open and Obvious” Doctrine

If an alleged dangerous condition is open and obvious, then the property possessor does

not have a duty to warn of or protect from it, unless the possessor is aware of some exceptional

characteristic of the condition that makes it “unreasonably dangerous.”18

A condition is “open and

obvious” if the plaintiff invitee or licensee knew of it or if a reasonably careful person under the

circumstances would have discovered it upon casual inspection.19

If a particular condition creates only an ordinary risk—such as the risk of tripping on

stairs—then the open and obvious doctrine will preclude liability if, in fact, the plaintiff should

have discovered the condition and appreciated the danger. On the other hand, if the condition

creates some unreasonable risk of harm beyond the ordinary, then the open and obvious doctrine

will not shield the defendant from liability even if the plaintiff knew of the condition or should

have known of it in the exercise of reasonable care.20

In other words, with regard to open and

obvious dangers, the critical question is whether there are truly “special aspects” of the

purportedly open and obvious condition that differentiate the risk that condition poses from

typical open and obvious risks so as to create a more serious “unreasonable risk.”21

If it does create a more serious “unreasonable risk,” even an “open and obvious”

condition can subject a property possessor to liability if he fails to warn of and/or correct the

condition. One scenario often considered a “special aspect” creating an “unreasonable risk” is

when the open and obvious hazard is unavoidable, as when, for example, an individual must pass

15

Kroll, 374 Mich. at 373 ; Bradley, 306 Mich. at 604; McCord, 5 Mich. App. at 130. 16

See, e.g., Whitmore v. Sears, Roebuck & Co., 89 Mich. App. 3, 8 (Mich. Ct. App. 1979) (“Where there

is no evidence to show that the condition had existed for a considerable time, however, a directed

verdict in favor of the storekeeper is proper.”). 17

James v. Alberts, 464 Mich. 12, 19 (2001); Stitt v. Holland Abundant Life Fellowship, 462 Mich. 591,

596 (2000). 18

Hoffner v. Lanctoe, 492 Mich. 450, 455 (2012); Lugo v. Ameritech Corp., 464 Mich. 512, (2001);

Riddle v. McLouth Steel Prods. Corp., 440 Mich. 85, 96 (1992). 19

Lugo, 464 Mich. at 516-518. 20

Id. at 516. 21

Id. at 516-518.

7

through it in order to access a premises.22

In such a case, the open and obvious doctrine would not

absolve the property possessor for liability for that hazard.

E. Assumption of Risk

Michigan recognizes the doctrine of express assumption of risk as a defense to liability in

very limited circumstances. The doctrine applies in only two cases: 1) when there is an

employment relationship between the plaintiff and the defendant (and the exclusivity provisions

of the Workers’ Compensation Law does not otherwise relieve the defendant of liability) ; and 2)

when the plaintiff has expressly assumed a risk by contract.23

The doctrine only serves to limit a

defendant’s liability once the defendant has been found negligent—it cannot relieve a defendant

of liability once liability has been found.24

The assumption of risk defense to liability is not due to

the fact that the plaintiff has somehow contributed to his injury by assuming the risk, but instead

to the fact that the plaintiff has essentially relieved the defendant of any duty towards him.25

22

Lugo, 464 Mich. at 518. 23

See Felgner v. Anderson, 375 Mich. 23 (1965) 24

Felgner, 375 Mich. 23. 25

See Felgner, 375 Mich. at 45 (“In such cases the acquiescence of the servant in the conduct of the

master does not defeat a right of action on the ground that the servant causes or contributes to cause the

injury to himself; but the correct statement is that no right of action arises in favor of the servant at all,

for, under the terms of the employment, the master violates no legal duty to the servant in failing to

protect him from dangers the risk of which he agreed expressly or impliedly to assume.”)

8

Liability Checklist/Considerations

for Negligence Claims

1. Is defendant a “possessor” of the premises where the

alleged injury occurred?

□ Occupying with intent to control?

□ Previously occupied with intent to control?

□ Entitled to immediate possession?

2. Plaintiff’s status on the premises (to establish duty):

□ Invitee?

□ Licensee?

□ Trespasser?

3. Was there a defective condition on the premises

involved in plaintiff’s accident?

4. Breach of duty—did the defendant:

□ Actually create the defective condition?

□ Have notice of the defective condition?

□ Fail to warn of the condition?

5. Was the condition “open and obvious?”

9

Examples of Negligence Claims

Various types of conditions form the basis for traditional negligence claims. Each is

subject to the same elements of proof—the type of duty owed to the plaintiff (the plaintiff’s

classification as an “invitee,” “licensee,” or “trespasser,”), the existence of a dangerous condition,

and the defendant’s failure to adhere to its duty with respect to that dangerous condition (whether

it be to inspect for it, to warn of it, or to correct it).

A. “Slip and Fall” Type Cases

1. Accumulations of Snow and Ice

Perhaps the most common basis for negligence claims is that a parking lot was not

properly plowed or salted following a snowfall. As with any other dangerous condition, a

property possessor’s duty with respect to that condition toward an individual depends on his

relationship to that individual—the duty depends on whether the individual is an invitee, licensee,

or trespasser.

A property possessor has a duty to exercise reasonable care to diminish the hazards of ice

and snow accumulations to invitees. Property possessors must therefore take reasonable measures

to diminish a snow and ice accumulation within a reasonable time after it accrues.26

Furthermore,

after an initial accumulation of snow or ice, a possessor has a continuing duty to take reasonable

steps within a reasonable time to diminish any further accumulation that accrues.27

Whether a

property possessor took reasonable care in diminishing an accumulation of ice or snow is

generally a question of fact.28

A property possessor does not, however have to make

extraordinary efforts to remove all snow and ice from his premises.29

Finally, warning of a snow

or ice accumulation danger does not fulfill a property possessor’s obligation to invitees—the

possessor must actively make a reasonable effort to clear the accumulation.30

Similarly, a property possessor has a duty to licensees with regard to an accumulation of

ice or snow if the possessor has reason to know of the accumulation, should realize that it

26

Orel v. Uni-Rak Sales Co., 454 Mich. 564, 565 (1997); Quinlivan v. Great Atlantic & Pacific Tea Co,

Inc., 395 Mich. 244, 261 (1975); Anderson v. Wiegand, 223 Mich. App. 549, 555 (Mich. Ct. App.

1997). 27

Quinlivan, 395 Mich. at 261; Anderson, 223 Mich. App. at 557. 28

Anderson, 223 Mich. App. at 558. 29

Mann v. Shusteric Enters., 470 Mich. 320, 322 (2004); Buhalis v. Trinity Continuing Care Servs., 296

Mich. App. 685, 697 (Mich. Ct. App. 2012). 30

See McCoy v. Monroe Park West Assocs., 44 F. Supp. 2d 910, 914 (E.D. Mich. 1999).

10

involves an unreasonable risk of harm, and should reasonably expect that licensees will not

discover the accumulation.31

The possessor can fulfill that duty toward licensees by either

affirmatively diminishing the accumulation as described above or warning licensees of the danger

the accumulation poses.32

Accumulations of ice or snow are often, but are not always, open and obvious dangers for

which a property possessor would not be held liable.33

As described above, an injury due to an

open and obvious snow or ice accumulation would not support a cause of action unless the danger

was unreasonable and the property possessor had actual or constructive knowledge of the icy or

snowy accumulation.34

One specific scenario that often arises regarding snow and ice accumulations is injury

from snow and ice accumulations on a public sidewalk. In Michigan, the natural accumulation

doctrine generally protects municipalities and abutting private landowners from liability for

injury to licensees caused by natural accumulations of ice or snow on public sidewalks.35

On a

public sidewalk, the owner of abutting land has no duty to remove natural accumulations of ice

and snow unless the landowner, through his or her own actions, has increased the hazards the

accumulations pose.36

The natural accumulation doctrine does not apply to injuries on private

property.37

2. “Black Ice”

“Black ice” is a condition well known to people who live in cold weather areas. It is a

thin layer of ice that forms on pavement or sidewalks and blends into the color of the surface

upon which it rests. Courts recognize that “black ice” is very difficult to see. As a result, black ice

sometimes may not be considered an “open and obvious” danger as a matter of law because the

invisibility of black ice may make it impossible for the average person of ordinary intelligence to

31

Altairi v. Alhaj, 235 Mich. App. 626, 637 (Mich. Ct. App. 1999); White v. Badalamenti, 200 Mich.

App. 434, 437 (Mich. Ct. App. 1993). 32

Leep v. McComber, 118 Mich. App. 653, 665 (Mich. Ct. App. 1982). 33

Quinlivan v. Great Atlantic & Pacific Tea Co, Inc., 395 Mich. 244, 261 (1975); Altairi, 235 Mich.

App. 626, 637 (Mich. Ct. App. 1999). 34

Hoffner v. Lanctoe, 429 Mich. 450 (2012); Kenny v. Kaatz Funeral Home, Inc., 472 Mich. 929 (2005);

Royce v. Chatwell Club Apts., 276 Mich. App. 389 (Mich. Ct. App. 2007). 35

Morrow v. Boldt, 203 Mich. App. 324, 327-328 (1994). 36

Altairi, 235 Mich. App. at 629; Anderson v. Wiegand, 223 Mich. App. 549 (Mich. Ct. App. 1997);

Morrow, 203 Mich. App. at 327-328. 37

Anderson, 223 Mich. App. 549; Morrow, 203 Mich. App. at 327-328.

11

discover.38

On the other hand, in the presence of some other visible indicia of wintry conditions, it

can be considered open and obvious.39

3. Snow Removal Contractors

Contrary to what would seem to be common sense, snow removal contractors generally

owe no duty to a plaintiff to keep premises safe. As explained above, only those persons or

entities in possession of and exercising control over premises can be liable for injury arising from

an accumulation of ice or snow on the premises.40

As a result, plaintiffs will not have a cause of

action directly against a snow removal contractor unless the contractor owed the plaintiff a

special duty separate and distinct from its contractual duties.41

That does not mean, however, that a snow removal contractor does not owe a duty to the

party with whom it contracted—generally the property possessor itself. The contracting party will

often assert third-party claims against the snow removal contractor alleging causes of action for

contribution, indemnification, and/or breach of contract.42

4. Slippery Surfaces—Cleaner, Polish, and Wax

Another common claim by a plaintiff is that the reason he or she fell was the nature of the

floor tile or the application of some cleaner, polish, or wax. The mere fact that a floor is slippery

due to the application of polish or wax does not give rise to a cause of action. To establish a cause

of action, a plaintiff would have to show the floor on which the fall occurred was, in fact,

dangerously slippery from improper waxing, or the like, at the time of the accident.43

5. Defenses

The mere fact that an accident occurred does not necessarily end in the result that a

property owner or lessee is liable. Depending on the nature of the alleged defect, there are various

defenses recognized by Michigan courts.

38

Slaughter v. Blarney Castle Oil Co., 281 Mich. App. 474, 484 (Mich. Ct. App. 2008). 39

Janson v. Sajewski Funeral Home, Inc., 486 Mich. 934, 935 (2010). 40

Orel v. Uni-Rak Sales Co., 454 Mich. 564, 567 (1997). 41

Fultz v. Union-Commerce Assocs., 470 Mich. 460 (2004); Derbabian v. Mariner’s Pointe Assocs. Ltd.

P’ship, 249 Mich. App. 695 (Mich. Ct. App. 2002). 42

See, e.g., Derbabian, 249 Mich. App. at 699 (upon being sued by plaintiff who slipped on ice in

parking lot, defendant property possessor filed a third-party complaint for indemnification or

contribution against defendant). 43

Galarno v. Great Atlantic & Pacific Tea Co., 260 Mich. 113 (1932); Pollack v. Oak Office Bldg., 7

Mich. App. 173, 180 (Mich. Ct. App. 1967).

12

a. Plaintiff Failed to Establish the Existence of a Dangerous Condition

As discussed above, a premises liability claim will fail absent proof that a “dangerous

condition” existed on the premises. If the plaintiff cannot establish there was anything wrong with

the premises, there is no liability for injuries resulting from a fall or other accident.44

Furthermore, where a plaintiff cannot specify—or can only speculate about—what

allegedly dangerous condition caused his or her accident, summary judgment dismissing the

plaintiff’s complaint is warranted. At a bare minimum, a plaintiff is required to establish facts and

conditions from which it can be reasonably inferred that a fall or other injury was caused by the

property possessor’s negligence, as opposed to other possible causes. The Michigan Supreme

Court has elaborated upon the distinction between conjecture and specificity sufficient to sustain

a premises liability action:

[A] conjecture is simply an explanation consistent with known

facts or conditions, but not deducible from them as a reasonable

inference. There may be [two] or more plausible explanations as

to how an event happened or what produced it; yet, if the

evidence is without selective application to any [one] of them,

they remain conjectures only. On the other hand, if there is

evidence which points to any [one] theory of causation,

indicating a logical sequence of cause and effect, then there is a

juridical basis for such a determination, notwithstanding the

existence of other plausible theories with or without support in

the evidence.45

In the context of a premises liability case, when there are different plausible explanations

for why the plaintiff’s accident occurred, but no evidence selectively supporting any of those

possible explanations, the plaintiff’s action should be dismissed.46

44

Lugo v. Ameritech Corp., 464 Mich. 512, 516 (2001). 45

Skinner v. Square D Co., 445 Mich 153, 164-165 (1994). 46

Stefan v. White, 76 Mich. App. 654, 661 (Mich. Ct. App. 1977) (“The mere occurrence of plaintiff’s

fall is not enough to raise an inference of negligence on the part of defendant. As has been noted,

plaintiff’s husband did not see the fall. His affidavit points to one possible cause . . . but it presents no

evidence linking that [cause] to the fall. Only conjecture can make this the causal element to the

exclusion of all others. Such speculation or conjecture is insufficient to raise a genuine issue of

material fact.”).

13

b. Trivial Defects

Not every arguable defect on a premises is sufficient to give rise to a claim of negligence.

As discussed above, the allegedly dangerous condition must present an “unreasonable risk of

harm” to render a property possessor liable.47

c. Open and Obvious Doctrine

The open and obvious doctrine, discussed above, applies to all alleged slipping hazards in

general, as does the exception for “special aspects” of an open and obvious hazard that would

negate the defense.48

47

Hoffner v. Lanctoe, 492 Mich. 450, 460 (2012) (“Perfection is neither practicable nor required by the

law, and [u]nder ordinary circumstances, the overriding public policy of encouraging people to take

reasonable care for their own safety precludes imposing a duty on the possessor of land to make

ordinary [conditions] foolproof.”) (quoting Bertrand v. Alan Ford, Inc., 449 Mich. 606, 615-16 (1995)

(internal quotation marks omitted)); Lugo, 464 Mich. at 516. 48

See, e.g., Watts v. Mich. Multi-King, Inc., 291 Mich. App. 98, 103 (Mich. Ct. App. 2010) (seeking to

apply open and obvious doctrine to wet floor).

14

Liability Checklist/Considerations for

“Slip and Fall” Cases

1. Ice and snow

□ Level of duty owed to plaintiff? Invitee,

licensee, or trespasser?

□ Open and obvious accumulation?

□ Injury on a public sidewalk? Natural

accumulation doctrine apply?

2. Slippery surfaces

□ Was the cleaner, wax, or polish applied in a

negligent fashion?

3. Defenses to “slip and fall” type cases

□ Was there no defect or is plaintiff unable to

specify the cause of his or her fall?

□ Did the defect present an “unreasonable risk?”

□ Was the defect “open and obvious?”

15

B. Liability for Violent Crime

Jury verdicts for liability arising from criminal acts perpetrated upon a shopper, a

restaurant or hotel guest, or another visitor to a property can expose the property possessor to

significant damages, even though the criminal act was committed by someone over whom the

property possessor had little or no control. In addition to the damages for personal injury, the

economic impact of a highly publicized trial can cause damage to a restaurant’s, hotel’s,

retailer’s, or retail center’s reputation in the community.

Under certain circumstances, a possessor of property can be held liable for the injuries

inflicted by an individual who, while on the possessor’s property, commits a violent crime against

another party. Still, despite a property possessor’s duty to minimize foreseeable dangers on their

property, including the criminal acts of third parties, it is not an insurer of a visitor’s safety, and

certain criteria must be met before the possessor can be held liable for the criminal acts of a third

party.49

1. Conditions of Liability

In Michigan, the liability of a property possessor for criminal acts of third parties depends

on both the foreseeability of the plaintiff’s injury and the reasonableness of the possessor’s

response to the criminal activity. First, a property possessor would only have a duty to protect

those invitees that are “readily identifiable as [being] foreseeably endangered.”50

The duty

is therefore triggered by specific acts occurring on the premises that pose a risk of imminent and

foreseeable harm to an identifiable invitee.51

If a property possessor knows or has reason to know,

from past experience, that there is a likelihood of third-party criminal conduct that is likely to

endanger the safety of a particular invitee, he may be under a duty to take precautions against it.

A possessor may “know or have reason to know” of the likelihood of such criminal activity if, for

example, the place or character of his business, or his past experience, is such that he should

reasonably anticipate criminal conduct on the part of third persons.52

Whether an invitee is, in fact

“readily identifiable” as being foreseeably endangered is a question for the finder of fact.53

49

Mason v. Royal Dequindre, Inc., 455 Mich. 391, 398 (1997); Williams v. Cunningham Drug Stores,

Inc., 429 Mich. 495, 500 (1988). 50

MacDonald v. PKT Inc., 464 Mich. 322, 332 (2001) (citing Mason, 455 Mich. at 398; Murdock v.

Higgins, 454 Mich. 46, 58 (1997)). 51

MacDonald, 464 Mich. at 338; Mason, 455 Mich. at 405. 52

Mason, 455 Mich. at 399. 53

MacDonald, 464 Mich. at 338; Mason, 455 Mich. at 404-05.

16

Once an invitee is found readily identifiable as being foreseeably endangered, a property

possessor is required to take reasonable measures in response to any ongoing situation that is

taking place on the premises and endangering the invitee.54

The “reasonable measures” a

possessor must take to protect an invitee do not require the possessor to provide extra security or

police guard, or otherwise resort to self-help to deter or stop third-party criminal acts.55

Rather, a

property possessor generally is not obligated to do anything more than reasonably expedite the

involvement of the police.56

2. Security Contractors

A plaintiff’s claim against a company contracted to provide security services on the

premises where his or her injury occurred is limited. Generally, a victim of violent crime does not

have a claim against a security company retained by a property owner for the same reason

discussed above on the liability of snow removal contractors—the security contractor generally

owes no duty to the plaintiff, who is not usually a party to the security contractor’s contract.57

Furthermore, even security companies generally do not owe a duty to prevent criminal conduct

of third parties in the absence of special circumstances.58

This is not to say, however, that a security contractor is free from liability with respect to

a plaintiff’s accident. As with snow removal contractors, a property possessor who contracted for

security services and is found liable for injuries to a plaintiff due to criminal conduct may be able

to seek contribution or indemnity pursuant to its contract if the security contractor was negligent

in the performance of its duties.

54

MacDonald, 464 Mich. at 332, 338. 55

MacDonald, 464 Mich. at 338; Williams v. Cunningham Drug Stores, Inc., 429 Mich. 495, 501 (1988). 56

MacDonald, 464 Mich. at 336. 57

Krass v. Joliet, Inc., 233 Mich. App. 661, 666 (Mich. Ct. App. 1999). 58

Krass, 233 Mich. App. at 668.

17

Liability Checklist/Considerations

for Criminal Activities

1. Was the invitee “readily identifiable” as being foreseeably

endangered by criminal activity?

□ Did the property possessor know or have reason to

know of the likelihood of criminal activity?

□ Was there ongoing criminal activity likely to injure the

invitee?

2. Were “reasonable measures” taken to prevent injury to that

invitee from the foreseeable criminal activity?

□ Did the property possessor promptly involve the police?

□ Was the property possessor’s response to the criminal

activity otherwise reasonable?

18

C. Claims Arising From the Wrongful Prevention of Thefts

“Inventory shrinkage” is the phenomenon of the loss of retail inventory due to theft. It is

a multi-billion-dollar problem faced by retailers worldwide. The biggest threat facing store

owners is employee theft, which accounts for nearly half of all inventory shrinkage.59

However, a

substantial problem faced by retailers is shoplifting by non-employees. In addition to the financial

impact of the loss of inventory and sales, the threat of shoplifting poses an additional problem

when retailers attempt to thwart a perceived attempt to shoplift—i.e., lawsuits for assault, battery,

false arrest, and even slander.

1. False Arrest and Imprisonment

False arrest or imprisonment is the unlawful restraint of an individual’s personal liberty

or freedom of locomotion. In other words, it consists of the unlawful detention of a person, for

any length of time, whereby the individual is deprived of his or her personal freedom.60

The

essence of a claim of false imprisonment is that the imprisonment is false, i.e., without right or

authority to do so.61

False arrest and false imprisonment are two distinct torts—the former actually involving

an arrest by a law enforcement official.62

The elements of the two claims are similar: a plaintiff

must establish “(1) an act committed with the intention of confining another, (2) the act directly

or indirectly results in such confinement, and (3) the person confined is conscious of his

confinement.”63

The existence of probable cause is a defense to a claim for false imprisonment.

Similarly, where the defendant merely seeks the assistance of law enforcement authorities or

provides them with information, and the police then use their own judgment to determine whether

or not criminal charges should be filed without further affirmative steps by the defendant, no

cause of action for false arrest or imprisonment will lie against the defendant.64

59

See Retail Fraud, Shoplifting Rates Decrease, According to National Retail Security Survey, June 15,

2010, (available at http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=945). 60

Stowers v. Wolodzko, 386 Mich. 119, 134 (1971); Tumbarella v. Kroger Co., 85 Mich. App. 482, 489

(Mich. Ct. App. 1978); Hess v. Wolverine Lake, 32 Mich. App. 601, 604 (Mich. Ct. App. 1971). 61

Moore v. City of Detroit, 252 Mich. App. 384, 388 (Mich. Ct. App. 2002); Hess, 32 Mich. App. at 604. 62

Moore, 252 Mich. App. at 386. 63

Id. 64

Lewis v. Farmer Jack Div., Inc., 415 Mich. 212, 218-19 (1982); Gooch v. Wachowiak, 352 Mich. 347,

351 (1958).

19

2. Malicious Prosecution

Claims for wrongful detention that result in arrests by law enforcement personnel often

also lead to claims for malicious prosecution. In order to sustain an action for malicious

prosecution, a plaintiff must show: (1) the defendant instituted or commenced proceedings

against the plaintiff that terminated in favor of the plaintiff; (2) the defendant had no probable

cause for the proceedings; and (3) the action was commenced with malice.65

Furthermore, a

plaintiff is required to show “special injury,” or interference with one’s person or property.66

Some of these elements are susceptible to common defenses. For example, a showing of

probable cause is a complete defense. The probable cause that precludes a recovery for malicious

prosecution is a reasonable ground for suspicion, supported by circumstances sufficiently strong

in themselves to warrant a cautious or prudent person in the belief that the party charged is guilty

of the offense. In other words, there is probable cause to instigate a prosecution against a person

when the information possessed is believed and is such and from such sources that the generality

of people under ordinary care, prudence, and discretion would prosecute under the same

conditions.67

It is also a complete defense to an action for malicious prosecution that the

prosecutor exercised independent discretion to initiate and maintain a prosecution, unless the

defendant knowingly provided false information on which the prosecutor based the decision to

prosecute or the defendant knowingly omitted exculpatory information which would have

dissuaded the prosecutor from prosecuting the plaintiff.68

3. Defamation

Claims of defamation may also arise where a shopper has been wrongfully accused of a

crime. Michigan recognizes certain “qualified privileges” where communications are made in

good faith in conjunction with the performance of security or operational functions in guarding

against the theft of goods. For example, a statement may be conditionally or qualifiedly

privileged where circumstances exist, or are reasonably believed by the defendant to exist, which

cast on him the duty of making a statement in the performance of a duty in good faith. 69

65

Matthews v. Blue Cross & Blue Shield, 456 Mich. 365, 378 (1998); Roblyer v. Hoyt, 343 Mich. 431,

435 (1955). 66

Friedman v. Dozorc, 412 Mich. 1, 32 (1981). 67

Drobczyk v. Great Lakes Steel Corp., 367 Mich. 318, 322-23 (1962); Merriam v. Continental Motors

Corp., 339 Mich. 546, 554 (1954). 68

Matthews, 456 Mich. 365. 69

Bufalino v. Maxon Bros., Inc., 368 Mich. 140, 153 (1962).

20

4. Negligent Hiring, Retention, or Supervision of Employees

Another claim often raised by plaintiffs who claim to have been wrongfully accused of

shoplifting is that the employee was improperly hired, trained, or supervised. A claim based on

negligent hiring and supervision requires a showing that the defendant knew of the employee’s

propensity to commit the alleged acts or that the defendant should have known of such propensity

had they conducted an adequate hiring procedure.70

Liability Checklist/Considerations for

Wrongful Attempts to Stop Thefts

1. False arrest/imprisonment

□ Intent to confine plaintiff?

□ Directly or indirectly confined?

□ Conscious of confinement?

□ Probable cause for confinement?

□ Did defendant merely report the facts to the

authorities?

2. Malicious prosecution

□ Criminal proceeding commenced?

□ Proceeding terminated in favor of accused?

□ Actual malice?

□ Special damage?

□ Probable cause?

□ Did defendant merely report the facts to the

authorities?

70

Burch v. A & G Associates, Inc., 122 Mich. App. 798, 807 (Mich. Ct. App. 1983).

21

D. Food Poisoning

Food poisoning and contamination claims are often brought under a variety of theories

including negligence, product liability, and breach of warranty. A negligence cause of action

against a restauranteur is predicated upon its duty to exercise care and prudence respecting the

fitness of the food it furnishes for consumption. As in any personal injury action, a plaintiff must

show a causal relationship between the contaminated product and their illness.71

71

See generally Frankamp v. Fordney Hotel, 222 Mich. 525 (1923) (discussing proof that a waitress was

taken ill from drinking tainted water at her place of employment).

22

Indemnification and Insurance-Procurement Agreements

Parties often attempt to shift the risk of loss stemming from a plaintiffs’ claims by

entering into agreements that contain indemnification provisions and require that insurance be

purchased for the benefit of one or more parties. While the ability to shift losses may vary with

the particular circumstances involved and the language of the agreement at issue, the following is

an overview of the law covering indemnification and insurance-procurement agreements.

A. Indemnification

Where sophisticated parties negotiate at arm’s length to enter into agreements containing

an indemnification clause, such a clause is valid and enforceable inasmuch as the parties have

allocated the risk of liability to third parties between themselves. Further, it is a basic premise of

contract law that an agreement will be interpreted so as to carry out the intentions of the parties

involved.72

Indemnification agreements commonly impose a duty to defend (discussed below) and

indemnify. As a general rule, indemnification agreements will require the indemnitor (the party

paying indemnity) to “defend, indemnify, and hold harmless” the indemnitee (the party receiving

indemnity) from claims made against the indemnitee arising out of the acts or business of the

indemnitor. For example, an owner may require a contractor to indemnify the owner for accidents

arising from the contractor’s work, as discussed above in the context of snow removal

contractors.

In Michigan, it is possible for a party to a contract to be indemnified for its own

negligence, though such provisions are scrutinized carefully. “[A] contract of indemnity will not

be construed to indemnify the indemnitee against losses which are the result of his own

negligence[] unless such intention is expressed in clear and unequivocal terms.”73

In determining

whether a contract is intended to indemnify a party for its own negligence, a court must consider

“the language of the contract, the situation of the parties and the circumstances surrounding the

72

Title Guaranty & Surety Co. v. Roehm, 215 Mich. 586, 592 (1921); Giguere v. Detroit Edison Co., 114

Mich. App. 452, 456 (Mich. Ct. App. 1982); Pritts v. J. I. Case Co., 108 Mich. App. 22, 29 (Mich. Ct.

App. 1981); Hayes v. General Motors Corp., 106 Mich. App. 188, 195 (Mich. Ct. App. 1981). 73

Giguere, 114 Mich. App. at 456 (Mich. Ct. App. 1982); Palomba v. East Detroit, 112 Mich. App. 209,

217 (Mich. Ct. App. 1982)

23

contract.”74

For example, broad language calling for indemnification of one party against “any”

or “all” losses could point to the intent that the party was to be indemnified even against its own

negligence.75

B. Insurance Procurement Agreements

To avoid problems with indemnification provisions and to make sure that there is a

financially responsible entity to satisfy claims, contracts and leases may also contain insurance

procurement provisions requiring one or both parties to obtain insurance and/or name the other

party as an additional insured. A contract to procure or provide insurance coverage is distinct

from and treated differently than an agreement to indemnify.

C. The Duty to Defend

The duty to provide a defense to another party can arise in the context of a lease or other

agreement and in the context of an insurance policy. Under both, the duty to defend is broader

than the duty to indemnify, and will often require the indemnitor to pay for all costs associated

with the defense of a plaintiff’s action.76

Under an insurance policy, a duty to defend is triggered by the allegations contained in

the underlying complaint. If there is any doubt regarding whether an allegation comes within the

scope of the policy, that doubt must be resolved in the insured’s favor, and the insurer must

commence defense until it is proven that the insurer has no duty to provide coverage.77

74

Paquin v. Harnischfeger Corp., 113 Mich. App. 43, 50 (Mich. Ct. App. 1982) (citing Title Guaranty &

Surety Co., 215 Mich. at 592). 75

Paquin, 113 Mich. App. at 50; Pritts, 108 Mich. App. at 28. 76

Polkow v. Citizens Ins. Co., 438 Mich. 174 (Mich. 1991). 77

Protective Nat’l Ins Co. of Omaha v. City of Woodhaven, 438 Mich. 154, 159 (1991); American

Bumper & Mfg. Co. v. Hartford Fire Ins. Co., 207 Mich. App. 60, 66-67 (1994), aff’d, 452 Mich. 440

(1996).

24

Damages in Premises Liability Cases

A. Damages Overview

At the conclusion of a trial, in the event of a verdict in favor of a plaintiff,

Michigan juries are asked to specify amounts for various components of damages. Juries

must allocate damage awards based on the following categories: (1) past economic and

non-economic damages; (2) future economic damages; and (3) non-economic damages.78

Economic damages include primarily lost wages, lost earning capacity, and medical

expenses. Non-economic damages include primarily pain and suffering. Any judgment

entered by the court must categorize damages in a similar fashion.79

B. Compensatory Damages

Compensatory damages are intended to put the party injured in as good condition

as he or she would have been in if the injury had not occurred.80

In order to warrant an

award of compensatory damages, the injured party must have suffered a wrong through

an invasion of a legally protected interest or right.81

Compensatory damages are the

damages proximately and directly resulting from the defendant’s conduct.82

They are the

damages that accrued naturally as a result of the wrong complained of in the pleadings.83

They do not require any exact method of computation; rather, they are determined to a

reasonable degree of certainty based upon facts and circumstances that permit the jury or

the court to estimate the injury to the complaining party sufficiently accurately.84

Compensatory damages consist of various categories of pecuniary and non-

pecuniary losses a party may have suffered as a result of an injury or wrong. Some types

of compensatory damages are intangible and are not directly quantifiable. The major

78

MICH. COMP. LAWS § 600.6305 (2014). 79

MICH. COMP. LAWS § 600.6306 (2014). 80

Grand Rapids & I. R. R. Co. v. Heisel, 47 Mich. 393, 398-399 (1882). 81

Dembinski v. Miller, 130 Mich. App. 822, 825 (Mich. Ct. App. 1983). 82

McDuffie v. Root, 300 Mich. 286, 293-294 (1942); Fleet Bus. Credit, LLC v. Krapohl Ford Lincoln

Mercury Co., 274 Mich. App. 584 (Mich. Ct. App. 2007). 83

Fleet Bus. Credit, LLC, 274 Mich. App. 584. 84

Berrios v. Miles, Inc., 226 Mich. App. 470, 478 (Mich. Ct. App. 1997).

25

types of intangible damages are pain and suffering, both past and future;85

loss of

enjoyment of life;86

and loss of consortium, or loss of society.87

Such intangible damages

are awarded only if there is reasonable certainty that they occurred, that is, for example, if

there is a reasonable certainty that an injured individual will incur future pain and

suffering.88

Loss of consortium in particular is a “derivative” claim that is brought on

behalf of the spouse or other family members of an injured individual. The Spouse or

other family member may recover a monetary amount for: 1) the reasonable value of

services performed by the family member for the injured individual; 2) the reasonable

value of services, such as household services, the family member has been deprived of by

reason of the injured individual’s injury; and 3) the reasonable value of the

companionship or sexual relationship the family member has been deprived of due to the

injured individual’s injury.89

Due to the unquantifiable nature of these intangible damages, the calculation of an

award of intangible damages is left in the hands of the jury.90

Courts are typically hesitant

to overturn a jury’s determination, and, on appeal, a jury’s determination of damages will

be affirmed if it is reasonably supported by the evidence.91

Tangible, or more readily quantifiable, damages, on the other hand, include

primarily medical expenses, lost wages, and lost earning capacity. Reasonable expenses

for medical care and treatment, including doctor bills and hospital bills, costs of nurses

and aids, and even travel expenses, are compensable.92

Future medical bills are

recoverable so long as the plaintiff can demonstrate a reasonable probability that his

injuries will require additional medical treatment in the future.93

In the state of Michigan, damages for lost wages are awarded not only for past

wages actually lost, but also for future wages that could have been earned, regardless of

85

Samuelson v. Olson Transp. Co., 324 Mich. 278 (1949). 86

Berger v. Weber, 411 Mich. 1, 35-36 (1981) (Levin, J., dissenting). Loss of enjoyment of life is

sometimes considered a separate and distinct category of damages and sometimes considered

subsumed within other categories of damages such as pain and suffering. 87

Long v. Chelsea Cmty Hosp., 219 Mich. App. 578, 589 (Mich. Ct. App. 1996). 88

See, e.g., Prince v. Lott, 369 Mich. 606, 609 (1963) (holding compensation may be allowed for future

pain and suffering if reasonable certainty of such future pain and suffering is established). 89

Long, 219 Mich. App. At 589. 90

See McMiddleton v. Otis Elevator Co., 139 Mich. App. 418, 427 (Mich. Ct. App. 1984). 91

See Werker v. McGrain, 315 Mich. 287 (1946). 92

Grinnell v. Carbide & Carbon Chems. Corp., 282 Mich. 509 (1937). 93

See Williams v. State Highway Dep’t, 44 Mich. App. 51, 58-59 (Mich. Ct. App. 1972).

26

whether they would certainly have been earned.94

Thus, a plaintiff could be awarded lost

wages damages based on a five-day work week even though she had only been working

two or three days a week at the time of injury.95

Furthermore, a plaintiff may be awarded

additional damages for future impairment of earning capacity if the plaintiff can show

that the future impairment is reasonably certain to occur. Thus, “the Michigan law

regarding damages for loss of earnings exhibits a policy favoring plaintiffs’ recovery of

the maximum quantifiable loss.”96

As is usually the case with damages, the plaintiff still has the burden of proving

lost wage and lost earning capacity damages with reasonable certainty.97

This is

traditionally done using tax returns or other similar documents, by comparing the injured

party’s earning capacity both before and after the injury occurred, by comparing the

injured party’s income post-injury with other similarly situated employees, or by

engaging a qualified expert witness, such as an economist, to provide expert testimony as

to the injured party’s earning potential as measured with his or her life expectancy and

other circumstances.

C. Exemplary and Punitive Damages

Exemplary and punitive damages, also known as “special damages,” are a natural

and proximate consequence of the wrong complained of, though not so directly or

immediately as general damages.98

They must be specifically pled in the complaint so as

to provide the defendant with notice that the plaintiff will claim them.99

Exemplary damages may be awarded when injuries are inflicted intentionally or

occur through carelessness or negligence so reckless and wanton as to be without

excuse.100

Exemplary damages are awarded to compensate a plaintiff for “injury to

feelings and for the sense of indignity and humiliation . . . maliciously and wantonly

94

Miller v. Pillow, 337 Mich. 262, 272 (1953). 95

Harris v. Weiner, 362 Mich. 656 (1961). 96

Nawrocki v. Hawkeye Sec. Ins. Co., 83 Mich. App. 135, 141 (Mich. Ct. App. 1978) 97

Prince v. Lott, 369 Mich. 606, 609 (1963). 98

Kratze v. Independent Order of Oddfellows, 442 Mich. 136, 148-149 (1993); Fleet Bus. Credit, LLC v.

Krapohl Ford Lincoln Mercury Co., 274 Mich. App. 584 (Mich. Ct. App. 2007). 99

Kratze, 442 Mich. at 148. 100

McPeak v. McPeak, 233 Mich. App. 483 (Mich. Ct. App. 1999).

27

inflicted.”101

A plaintiff seeking exemplary damages must specifically plead willful or

malicious conduct in his complaint.102

Before becoming eligible for exemplary damages,

a plaintiff must first be awarded compensatory damages such as those described above.103

Furthermore, a plaintiff cannot receive both exemplary damages and damages

specifically for mental anguish or distress, as the two types of damages serve much the

same purpose.104

Finally, the amount of an award of exemplary damages rests largely

with the discretion of the jury because exemplary damages are unquantifiable by their

very nature. Still, the jury’s discretion as to an appropriate amount of exemplary

damages is not unlimited, and an amount of exemplary damages that would “shock the

conscience” of an average person would be impermissible.105

Given the heightened prerequisite to exemplary damages of malicious or

intentional conduct, exemplary damages would not be appropriate in the vast majority of

premises liability matters. In the past, they have rarely been granted, though they have

been seen in cases involving the sale of intoxicating liquors.106

The other type of special damages—punitive damages—is even rarer than

exemplary damages. The purpose of punitive damages, as distinguished from exemplary

damages, is “to punish or to make an example of a defendant because of the malice or

recklessness with which he acted.”107

Punitive damages are generally not permitted in

Michigan unless authorized by statute.108

D. Nominal Damages

Nominal damages arise in cases where an individual has been wronged, but has

not suffered any damage or harm as a result. Where compensatory damages are awarded

101

Am. Cent. Corp. v. Stevens Van Lines, 103 Mich. App. 507, 514 (Mich. Ct. App. 1981). 102

McPeak, 233 Mich. App. 483. 103

Stratton v. Jensen, 64 Mich. App. 602, 610 (Mich. Ct. App. 1975). 104

Veselenak v. Smith, 414 Mich. 567, 573-74 (1982). 105

Stuyvesant v. Wilcox, 92 Mich. 233, 241 (1892); Oppenhuizen v. Wennersten, 2 Mich. App. 288, 298

(Mich. Ct. App. 1966) 106

See, e.g., Manuel v. Weitzman, 386 Mich. 157, 167 (1971), overruled in part by Brewer v. Payless

Stations, Inc., 412 Mich. 673 (1982) (allowing both actual and exemplary damages under Michigan’s

Dram Shop Act). 107

Am. Cent. Corp. v. Stevens Van Lines, 103 Mich. App. 507, 514 (Mich. Ct. App. 1981). 108

Casey v. Auto Owners Ins. Co., 273 Mich. App. 388 (2006); Gregory v. Cincinnati Inc., 450 Mich. 1,

23 n.31 (1995).

28

to make an injured party whole, nominal damages exist to vindicate a legal right where

there has been no actual harm caused.109

Nominal damages usually take the form of

miniscule awards, such as one dollar. Although legally permissible, nominal damages are

not generally awarded in negligence cases because proving loss or damages is an

essential element of the cause of action.110

E. Wrongful Death

There are two components to the damages resulting from a wrongful death: the

damages suffered by the heirs of the decedent and the damages suffered by the decedent

prior to his or her death. The calculation of the damages available to the distributees of

the decedent’s estate, the “wrongful death” damages, is codified under Section 600.2922

of the Michigan Code.

Under Michigan’s wrongful death statute, “pecuniary losses” suffered by the

distributes are available as damages. Those losses include the reasonable medical,

hospital, funeral, and burial expenses for which the estate is liable and damages for the

loss of financial support and the loss of the society and companionship of the deceased.

Furthermore, hedonic damages for the pain and suffering, while conscious, undergone by

the deceased during the period intervening between the time of the injury and death, are

permitted. Finally, damages for the loss of financial support and the loss of the society

and companionship of the deceased are permitted.111

This includes the loss of parental

guidance and support (both moral and monetary) of a child due to the death of a parent.112

Similarly, a parent may also recover for the pecuniary losses resulting from the death of a

child if there is evidence that the decedent-child was legally obligated to provide services

to the parent or there is evidence that the decedent would have volunteered to do so.113

In determining what is fair and just compensation, factors that have traditionally

been considered include: the age, health, and life expectancy of the decedent at the time

109

4041-49 W. Maple Condo. Ass’n v. Countrywide Home Loans, Inc., 282 Mich. App. 452, 460 (Mich.

Ct. App. 2009). 110

Lawrence v. Tippens, 53 Mich. App. 461, 465 (Mich. Ct. App. 1974); see generally WILLIAM L.

PROSSER, LAW OF TORTS 143 (West Publishing Company 1978). 111

MICH. COMP. LAWS § 600.2922(6) (2014). 112

Westfall v. Venton, 1 Mich. App. 612 (Mich. Ct. App. 1965). 113

Rohm v. Stroud, 386 Mich. 693 (1972).

29

of the injury; the decedent’s future earning capacity and potential for career

advancement; and the number, age, and health of the decedent’s distributees. Generally,

evidence of a decedent’s gross income at the time of death is the standard to measure the

value of income already lost and to measure the loss of future earnings.

30

Retail, Hospitality, and Development Practice Group

Goldberg Segalla represents numerous high-profile clients in the commercial development,

shopping center, and retail industries. Our clients include some of the world’s largest private and

publicly traded owners and developers of shopping centers, national and international retailers,

hotels and resorts, restaurants, convenience store chains, office and industrial parks, and

managers of commercial properties.

Through our long-standing relationships with our clients, we have developed a thorough

understanding of their unique businesses, concerns and needs. We recognize that the business

environment is extremely fluid and challenging, and we strive to provide innovative and creative

legal and consulting solutions to help our clients avoid disputes and manage risk.

At Goldberg Segalla, we assist our clients in creating and implementing policies and procedures

that minimize their exposure and improve the safety of their customers and employees. Our

experience also allows us to offer consulting services in lease and construction contract

preparation and drafting, indemnification and insurance, risk management, land-use permitting,

and zoning.

Our experience includes:

Tort claims

Defense of liability claims (including liability for violent crimes)

Product liability

Worker’s compensation

Business disputes

Advertising and social media

Bankruptcy and collections

Commercial leasing

Construction defects and contract disputes

Contract disputes

Customs and international trade

Employment and labor disputes (including personnel manuals, reductions in force,

and defense)

Insurance coverage

Intellectual property (including registration, maintenance, rights, and licensing)

Landlord – tenant disputes

Product recall and Consumer Product Safety Commission issues

Transactional (including distributors, sales agents, marketing, licensing, acquisitions,

and mergers)

Zoning, environmental and land use

For more information, please contact Kenneth M. Alweis (kalweis@goldbergsegalla.com,

315.413.5410), or any member of the Retail, Hospitality, and Development Practice Group.