Conflict resolution: COA streamlines amendment process

By Agenique Smiley
BridgeTower Media Newswires
 
DETROIT — In absence of conflict, court rules and statutes should be read in harmony, each being interpreted to give effect to the intent of the drafter. In the instance of a potential conflict between a court rule and a statute, the determination must be made by reading each according to its plain meaning.

However, under some circumstances, a simple reading and comparison may be insufficient. In Stenzel v. Best Buy Company, Inc., a special seven-judge panel was convened to resolve the questions of whether a conflict existed between MCL 600.2957(2) and MCR 2.112(K)(4) as pertaining to the process of amending pleadings to add a party previously identified as a nonparty at fault and the effect of the process on the relation-back language in MCL 600.2957(2) with regards to the application of the governing limitations period.

The special panel ultimately concluded that a procedural conflict existed between MCL 600.2957(2) and MCR 2.112(K)(4), resulting in the holding that a party may file amended pleading as of right and that the relation-back doctrine applies to parties added pursuant to MCR 2.112(K)(4).

The prior ‘Stenzel’ opinion

In Stenzel v. Best Buy Company, Inc., plaintiff Paulette Stenzel purchased a Samsung refrigerator/freezer from Best Buy Co., Inc. whose employees later delivered the appliance to her home and installed it. About two days later, the refrigerator sprayed water all over her kitchen floor. She fell and sustained injuries in another room while dragging a basket of wet towels.

In April 2014, Stenzel filed a claim against Best Buy alleging negligence, breach of contract and breach of warranty. In May 2015, Stenzel amended her complaint, adding Samsung Electronics America, Inc. as a nonparty at fault, doing so within 91 days of it being identified in a notice as a nonparty at fault. Stenzel did so without, first, filing a motion for leave to amend her complaint.

Both Best Buy and Samsung moved for summary disposition on the grounds that Stenzel failed to prove causation. The trial court granted both motions. The trial court also held that Stenzel’s claims against Samsung were barred by the statute of limitations as measured by the date the amended complaint was filed, not the date on which the suit was first initiated against Best Buy.

The Court of Appeals held that the trial court erred in regard to the issue of causation with regard to both Best Buy and Samsung, but its reversal applied only to Best Buy as plaintiff’s claims against Samsung were deemed barred by the statute of limitations.

Regarding the statute of limitations, Stenzel argued that the amended complaint related back to the date of the original complaint, which had been filed within the applicable limitations period.

Samsung countered, stating that, since Stenzel failed to seek leave of the court prior to filing her amended complaint, the relation-back provision in MCL 600.2957(2) did not apply.

The Court of Appeals, in opining that Williams v. Arbor Home, Inc. was wrongly decided, stated that it agreed with the reasoning of Judge Peter D. O’Connell in his partial dissent which acknowledged that a conflict existed between MCR 2.112(K)(4) and MCL 600.2957(2) and identified the real issue, whether a plaintiff must file for leave to amend a complaint is a matter of procedure, and, therefore, the court rule controls.
O’Connell stated that he would have allowed the appeal to proceed.

As directed by the controlling precedent in Williams, the panel ultimately affirmed the trial court’s order and request that the court convene a special conflict panel, MCR 7.215(J)(2) and (3).

‘Stenzel v. Best Buy Company, Inc.’

In Stenzel v. Best Buy Company, Inc., a special seven-judge panel was convened to resolve the conflict presented in Stenzel v. Best Buy Company, Inc. decided Dec. 22, 2016. The panel was tasked with determining the proper interpretation of and the interplay between MCL 600.2957(2) and MCR 2.112(K)(4) as pertaining to amending pleadings to add a party previously identified as a nonparty at fault. The judges were also charged with measuring the effect of the process on the relation-back language of the statute for purposes of the governing period of limitations.

The existence of a conflict

The special panel, observing that the Michigan Supreme Court has exclusive authority with respect to all aspects of the Michigan Court Rules and noting that it was the Supreme Court that established and adopted MCR 2.118, recognized that amendments by leave and amendments by right are two separate and distinct procedural mechanisms.

In so doing, the judges concluded that the Supreme Court was “unquestionably knowledgeable” of that distinction when promulgating MCR 2.112(K) in its effort to implement MCL 600.2957(2).

The appointed panel examined the fact that the Legislature, when outlining the pleading amendment process under MCL 600.2957(2), purposefully and solely conditioned the ability to do so on, first, filing a motion for leave to amend. The judges pointed out that there is no language in the statute authorizing a party to file an amended pleading as a matter of course or right within the 91-day window following the identification of a nonparty at fault.

In consideration of MCR 2.112(K)(4), the seven-judge assembly surmised that the Supreme Court intentionally deviated from the statutory language in MCL 600.2957(2) in order to streamline and simplify the pleading amendment process, allowing a party as a matter of right or course to amend a pleading within the 91-day period.

In its reasoning, the panel acknowledged that because MCL 600.2957(2) only permits amendments of pleadings upon motion and leave granted, the process is not conducive to judicial expediency and efficiency as courts have no discretion whatsoever and must grant leave without exception.

The panel found that a conflict existed between MCR 2.112(K)(4) and MCL 600.2957(2) as the Legislature only contemplated amendment by leave and our Supreme Court called for amendment as a matter of course or right.

By extension, because the panel held, contrary to Williams, that a conflict exists between MCL 600.2957(2) and MCR 2.112(K)(4) with respect to the procedure to amend a pleading to add an identified nonparty at fault, it also found that the reasoning in Williams was flawed.

Period of limitations and the relation-back provision

The panel also held that Stenzel was entitled to the protection of the relation-back provision in MCL 600.2957(2) and that the Ingham Circuit Court erred in when it dismissed her claim against Samsung on the basis that the period of limitations had elapsed.

Stenzel argues that because she added Samsung as a party within 91 days of Samsung being named as a nonparty at fault, her amended complaint relates back to the date of her original complaint, which was filed within the limitations period.

The panel observed that the second sentence — or relation-back provision — in MCL 600.2957(2) provides that a cause of action added under that subsection is not barred by a period of limitations unless the cause of action would have been barred by a period of limitations at the time of the filing of the original action.

Samsung argues that because the Legislature referred to an action “added under this subsection” for purposes of the relation-back provision, the relation-back provision is rendered inapplicable if an identified nonparty at fault is added to the suit under MCR 2.112(K)(4).

The panel acknowledged that the Supreme Court did not address the statutory relation-back provision in the context of a party amending a pleading as a matter of course or right within the 91-day period in MCL 600.2957(2); however, it also cautioned that the Supreme Court’s seeming silence on the issue should not be interpreted to mean that a pleading amended consistent with MCR 2.112(K) is not to be afforded the protection of the statutory relation-back provision.

The seven-judge tribunal opined that Samsung failed to understand that the Supreme Court, in promulgating MCR 2.112(K)(4), intended to provide assistance and details in implementing MCL 600.2957(2), not to nullify by silence the Legislature’s clear desire to allow the relation-back of an amended pleading for purposes of a given period of limitations.

The specially convened panel ultimately found that, through its silence, the Michigan Supreme Court left the relation-back provision of MCL 600.2957(2) fully enforceable and that its interpretation reflected the Legislature’s intent to allow a party, in all instances if done so timely, to amend a pleading to add an identified nonparty at fault.

 

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