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Volume XVII, No. 47 September 30, 2005 JAMES L. BORIN, CO-EDITOR SIMEON R. ORLOWSKI, CO-EDITOR (248) 641-7600
Stacey King1 – Contributor
THE RESURGENCE OF THE “WRONGFUL CONDUCT RULE”
Although done in an unpublished opinion, it is still good to see that the Michigan Appellate Courts are upholding dismissal of cases based on the application of the “wrongful conduct rule”. The “wrongful conduct rule” holds that a person cannot maintain an action if, in order to establish his cause of action, he must rely, in whole or in part, on an illegal or immoral act or transaction to which he was a party. The genesis of the wrongful conduct rule can be traced back to Orzel v Scott Drug Co, 449 Mich 550 (1995). In Orzel, the plaintiff sued a pharmacy claiming that it had filled prescriptions for a regulated drug without asking for identification or allowing an adequate interval between prescriptions. The plaintiff admitted that his purchase and use of the drug was illegal and that he had become addicted to the drug. Nevertheless, the plaintiff sued the pharmacy claiming that its negligence had proximately caused his addiction, which resulted in hallucinations and mental illness, leading to pain, suffering and loss of earning capacity. The Michigan Supreme Court rejected the plaintiff’s claim and held that the plaintiff’s action was barred because the action was based on his own illegal conduct: “The rationale that Michigan courts have used to support the wrongful-conduct rule are rooted in the public policy that courts should not lend their aid to a plaintiff who founded his cause of action on his own illegal conduct. [I]f courts chose to regularly give their aid under such circumstances, several unacceptable consequences would result. First, by making relief potentially available for wrongdoers, courts in effect would condone and encourage illegal conduct. [S]econd, some wrongdoers would be able to receive a profit or Ms. King is an associate in the Firm’s Detroit office and can be reached at (313) 446-1530.
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compensation as a result of their illegal acts. Third, and related to the two previously mentioned results, the public would view the legal system as a mockery of justice. Fourth, and finally, wrongdoers would be able to shift much of the responsibility for their illegal acts to other parties. As stated by the Court of Appeals, where the plaintiff has engaged in illegal conduct, it should be the "plaintiff's own criminal responsibility which is determinative." [Internal citations omitted]. Orzel v Scott Drug Co, 449 Mich 550, 559-560 (1995). In homage to the sustaining power of the wrongful conduct rule as a valid defense, particularly in dramshop cases, the Michigan Court of Appeals recently issued its unpublished decision in the case of Barth v Goal Tender Sports Pub and Grill (COA #262605, 9/22/05). Barth involved a plaintiff’s appeal of right from an order granting summary disposition in favor of all defendants in a combined automobile negligence and dram shop action, and dismissing the case in its entirety. The facts of the Barth case involve the defendant Gravelyn, the plaintiff’s decedent, and several of their friends, who had spent an evening drinking at several different bars, including several of those establishments that were run by the dram shop defendants. At the end of the evening, and under disputed circumstances, Gravelyn drove the decedent's vehicle, with the decedent and one other individual as passengers. The vehicle crashed, the decedent was killed, and the other passenger was seriously injured. Plaintiff filed a wrongful death action of behalf of the decedent, alleging that Gravelyn was negligent in causing the accident, and that the dram shop defendants had violated the Michigan Liquor Control Code, MCLA §436.1101, et seq. (formerly known as the Dramshop Act, MCLA §436.22). The trial court concluded that the evidence showed that the plaintiff’s decedent had voluntarily given Gravelyn the keys to her vehicle while Gravelyn was visibly intoxicated, thereby contributing to her own death. On that basis, it was held that plaintiff’s decedent had violated MCLA §257.625(2), which provides that the owner of a vehicle shall not authorize or knowingly permit his vehicle to be operated by someone under the influence. Thus, the trial court held, summary disposition based on the application of the "wrongful conduct rule", was appropriate. The Barth plaintiff attempted to avoid the application of the wrongful conduct rule by arguing that MCLA §257.625(2) was merely a safety statute, and thus, was not of the type of illegal or immoral conduct that would typically invoke the application of the wrongful conduct rule. However, the Court of Appeals found that since a violation of MCLA §257.625(2) is a felony, and since the illegality contemplated in the statute is certain to cause death or serious injury, that it was more than a mere safety statute and, therefore, that a violation of MCLA §257.625(2) was of the magnitude to invoke the wrongful conduct rule. In an act of extreme clarity, the Barth Court not only held that the wrongful conduct rule applied so as to bar the plaintiff’s action against Gravelyn, it went further, and ruled that the dram shop defendants were also entitled to protection by application of the wrongful conduct rule. While the dram shop defendants had argued defenses and issues under the Liquor Control Code entitled them to summary disposition, the Barth Court pointed out that MCLA §436.1801(7) allows a liquor licensee to assert any and all defenses available to the allegedly visibly intoxicated person (AIP Gravelyn, in this case). Therefore, because the Court held that the wrongful conduct rule applied to Gravelyn, it also applied to the remaining dram shop defendants, and they too were entitled to summary disposition.
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Because there was no genuine dispute of material fact that defendant Gravelyn was visibly intoxicated when he became the driver, the wrongful conduct rule applied, and the Barth Court ruled that the trial court had properly granted all of the defendants summary disposition. This writer has also had recent success at the trial court level, in using the wrongful conduct rule as a shield in a dram shop action. The case of Demmy v Taylor Township Lodge No. 887, Local Order of the Moose, and James E. Dezomits, was filed in the Wayne County Circuit Court, and was assigned to the Hon. Judge Kathleen MacDonald. The Law Firm of Garan, Lucow, Miller, P.C., Stacey L. King, Esq., was representing Taylor Township Lodge No. 887, Local Order of the Moose. The Plaintiff’s Complaint alleged that the Taylor Moose Lodge was liable for injuries she sustained during an altercation (a “bar fight”) that took place in the parking of the Lodge, pursuant to the MCLA §436.1101, et seq., for serving defendant James Dezomits while he was visibly intoxicated. The facts of the case centered around a physical altercation between and amongst several people, including the plaintiff, her daughter, the defendant AIP Dezomits and other family members, after all parties left the bar area at the Taylor Moose Lodge. Defendant Taylor Township Lodge filed its motion for summary disposition, arguing various defenses available under the Michigan Liquor Control Code, including that the plaintiff failed to produce any evidence that AIP was actually visibly intoxicated while at the Taylor Moose Lodge, and that she failed to produce evidence that the AIP was served alcohol by the Taylor Moose Lodge when he was already visibly intoxicated. At oral argument on defendant Taylor Moose Lodge’s motion for summary disposition, Judge MacDonald had other ideas in mind. She ruled from the bench that this was a “mutual affray” type of case, and as such, that she wanted all parties to brief the issue of the wrongful conduct rule. Upon receiving and reviewing the parties’ respective supplemental briefs, the Court dismissed Plaintiff Demmy’s action against both the Taylor Moose Lodge, as well as against the AIP Dezomits. The Court held that since both Demmy and Dezomits had admitted to being involved in a physical altercation, wherein they each struck another person, the wrongful conduct rule would apply to bar the plaintiff’s claims. In the same vein as Barth, supra, the trial court in this Demmy case, held because a liquor licensee can assert all of the defenses available to the AIP, defendant Taylor Moose Lodge was also entitled to summary disposition pursuant to application of the wrongful conduct rule. Summary disposition was granted to all defendants in this case in May, 2005. The moral of the story is clear: the “wrongful conduct rule” is alive and well, so be aware of those cases where your facts provide an avenue for the application of the rule as a complete defense.
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