This case returns to us on remand from our Supreme Court to reconsider whether the trial court properly dismissed plaintiff Devon Scott Bailey’s claims against defendants T.J. Realty, Inc., which did business under the name Hi-Tech Protection, Inc. (Hi-Tech), Evergreen Regency Townhomes, Ltd. (Evergreen), and Radney Management & Investments (Radney). Bailey v Schaaf,
I. BASIC FACTS
In November 2007, Bailey sued various parties to recover damages for injuries he sustained after defendant Steven Gerome Schaaf shot him at an outdoor gathering on the grounds of an apartment complex. See Bailey v Schaaf,
In that first appeal, we addressed three issues: whether the trial court abused its discretion when it allowed Evergreen and Radney to amend their responses to Bailey’s request for admissions, whether the trial court erred when it determined that Bailey was not a third-party beneficiary of the contract for security services between Evergreen and Hi-Tech, and whether the trial court erred when it dismissed Bailey’s claims against Evergreen, Radney, and Hi-Tech under MCR 2.116(C)(8) after it determined that Bailey failed to identify a duty that any of these defendants owed to him. See Bailey,
Turning to the duties that Evergreen and Radney may have owed to Bailey, this Court surveyed the authorities addressing a premises possessor’s duty to his or her invitees and recognized that the common law does not normally impose a duty to protect invitees from criminal acts by third parties. Id. at 629-642. This Court, however, acknowledged that our Supreme Court had determined that merchants have a limited duty to respond to criminal acts: the merchant must expedite the involvement of the police “when a situation presently occurring on the premises poses a risk of imminent and foreseeable harm to identifiable invitees.” Id. at 636, citing MacDonald v PKT, Inc,
Finally, we determined that Hi-Tech had no comm on - law duty to protect Evergreen and Radney’s invitees from criminal acts by third parties; we explained that any duty that Hi-Tech may have had arose from its contract to provide security services, which Bailey could not use as a basis for his claim because he was not a third-party beneficiary under the contract. Id. at 642-643, citing Fultz v Union-Commerce Assoc, 470 Mich 460, 461-462;
On further appeal, our Supreme Court affirmed this Court’s extension of the duty stated in MacDonald to the landlord-tenant relationship. Bailey,
First, it asked this Court to consider Evergreen and Radney’s argument that the dismissal of the claims against the security guards relieved them of vicarious liability under the decision in Al-Shimmari v Detroit Med Ctr,
Second, the Supreme Court asked this Court to reconsider our decision concerning Hi-Tech’s duty to Bailey — if any — in light of the decisions in Loweke v Ann Arbor Ceiling & Partition Co, LLC,
II. HI-TECH’S DUTY
A. STANDARD OF REVIEW
We first reconsider whether the trial court properly dismissed Bailey’s claim against Hi-Tech on the grounds that he failed to show that Hi-Tech owed him a duty that was distinct from those provided under Hi-Tech’s agreement with Evergreen and Radney. This Court reviews de novo whether the trial court properly granted a motion for summary disposition.
B. CONTRACTUAL DUTIES AND TORT LIABILITY
In our prior opinion, we determined that Bailey “failed to identify a duty that was separate and distinct from Hi-Tech’s duties under its contract with Evergreen.” Bailey,
In order to recover against Hi-Tech, Bailey had to establish as a threshold matter that Hi-Tech owed him a duty of care. See Hill,
A party to an agreement has an enforceable contractual duty to perform as agreed in the contract. See Bloomfield Estates Improvement Ass’n, Inc v City of Birmingham,
Nevertheless, even though a party to a contract does not have a duty to perform for the benefit of third parties, Michigan courts have long recognized that persons acting pursuant to a contract may be liable to third parties at common law for negligently performing their contractual duties. Fultz,
In Hart, our Supreme Court had to determine whether Hazen Hart and Lorene Hart properly stated a claim in tort against Frederick Ludwig. Id. at 560. The Harts had hired Ludwig to care for their orchard, but shortly after beginning work for the 1953 season, Ludwig refused to continue working. Id. The Harts alleged a tort claim premised on Ludwig’s negligent failure to remove shoots, prune, fertilize, and protect the orchard from destructive animal life, which caused them damage. Id.
Turning to whether the Harts’ claim sounded in tort, our Supreme Court recognized that the “question is not without difficulty.” Id. The Court explained that there had arisen a distinction between claims arising from misfeasance and nonfeasance. This distinction was between claims arising from the negligent failure to perform or timely perform under the contract (nonfeasanee), which were actionable only in contract, and claims arising from active negligence causing harm (misfeasance), which were actionable in tort. Id. at 561-565. The Court stated that it was often difficult to distinguish between nonfeasance and misfeasance in borderline cases. According to the Court, such cases may involve nonfeasance, as with a surgeon’s failure to sterilize his instruments or a builder’s failure to fill a ditch, which also constitute misfeasance. Id. at 564-565. In examining the facts from those decisions in which the courts had concluded that an action in tort would lie, our Supreme Court surmised that the common thread was whether the claim involved a breach of duty that was distinct from enforcing the contractual promise:
These are all, it is true, failures to act, each disastrous detail, in itself, a “mere” nonfeasance. But the significant similarity relates not to the slippery distinction between action and nonaction but to the fundamental concept of “duty”; in each a situation of peril has been created, with respect to which a tort action would lie without having recourse to the contract itself. Machinery has been set in motion and life or property is endangered. It avails not that the operator pleads that he simply failed to sound the whistle as he approached the crossing. The hand that would spare cannot be stayed with impunity on the theory that mere nonfeasance is involved. In such cases... we have a “breach of duty distinct from contract.” Or, as Prosser puts it “if a relation exists which would give rise to a legal duty without enforcing the contract promise itself, the tort action will lie, otherwise not.” [Id. at 565 (citations omitted).]
Because the “only duty, other than that voluntarily assumed in the contract to which [Ludwig] was subject, was his duty to perform his promise in a careful and
Our Supreme Court reexamined the distinction between a claim arising from the failure to perform under a contract and the negligent performance of a contractual obligation in Fultz. In that case, Sandra Fultz fell and injured her ankle while walking across a parking lot owned by Comm-Co Equities. Fultz,
In analyzing the issue, our Supreme Court first acknowledged that persons who undertake to perform an act for another — as with a typical agent or independent contractor — have a duty to perform the act in a nonnegligent manner. Id. at 465. The Court explained that this duty must nevertheless be one that the person specifically owed to the plaintiff or must be one that the person owed to the general public. Id., quoting Clark v Dalman,
But the Court felt that this distinction was largely “semantic” and “somewhat artificial.” Id. As had been recognized in Hart, the Court stated, the real distinction was not one of misfeasance or nonfeasance, but of duty. Fultz,
Turning to the facts of the case, the Court determined that Fultz’s claims against Creative Maintenance failed because she did not establish that Creative Maintenance had a common-law duty to remove the snow and ice from Comm-Co’s parking lot; instead, she essentially alleged that Creative Maintenance breached its contract with Comm-Co “by failing to perform its contractual duty of plowing or salting the parking lot.” Id. at 468. Moreover, although the Court agreed that the performance of a contractual obligation may amount to a breach of duty that is separate and distinct when the performing party creates a new hazard, Fultz did not allege that Creative Maintenance created a new hazard; she only alleged that it failed to clear the lot. Id. at 469. Because Fultz could not rely on Creative Maintenance’s breach of its contractual duty to Comm-Co to establish a claim against Creative Maintenance, the Supreme Court reversed the jury’s verdict against Creative Maintenance. Id. at 470.
As can be seen from a careful reading of Fultz, the Court did not alter the substantive law applicable to claims arising from the negligent performance of a contractual duty; instead, it adopted the analytical framework stated in Hart and Rinaldo’s. Nevertheless, after the decision in Fultz, some courts “misconstrued” the decision in Fultz to create a “form of tort immunity” for negligence claims raised by noncontracting third parties. Loweke,
In Loweke, our Supreme Court rejected the notion that Fultz established a new test premised on the nature of the obligations under the contract. In Fultz, it explained, it had merely “recast the test to focus on whether any legal duty independent of the contract existed.” Id. at 169.
Determining whether a duty arises separately and distinctly from the contractual agreement, therefore, generally does not necessarily involve reading the contract, noting the obligations required by it, and determining whether the plaintiffs injury was contemplated by the contract. Instead, Fultz’s directive is to determine whether a defendant owes a noncontracting, third-party plaintiff a legal duty apart from the defendant’s contractual obligations to another. As this Court has historically recognized, a separate and distinct duty to support a cause of action in tort can arise by statute, or by a number of preexisting tort principles, including duties imposed because of a special relationship between the parties, and the generally recognized common-law duty to use due care in undertakings. [Id. at 169-170 (citations omitted).]
Because the trial court and this Court had misapplied the test stated in Fultz to the facts in Loweke, the Supreme Court
Our Supreme Court applied the clarified Fultz decision in Hill,
On appeal, the Court determined that Sears had a limited relationship with the Hills that involved meeting its contractual obligation to deliver and install the dryer and to do so with due care. Id. at 662-664. The Court rejected the contention that, by agreeing to deliver and install the electric dryer, Sears assumed additional duties not associated with the delivery and installation. Id. at 665. Instead, it held that Sears had no duty with respect to the gas line. Id. Finally, the Court agreed that Sears could be liable for breaching a duty that was separate and distinct from its contract as stated in Fultz, but concluded that the Hills failed to establish that Sears breached such a duty by creating a “new dangerous condition” or making “an existing dangerous condition more hazardous”: “The placement of the dryer did not affect the existence or nature of the hazard in any manner because the danger posed by the uncapped gas line was exactly the same before and after the electric dryer was installed.” Id. at 671.
Turning to this case, under Fultz, as clarified in Loweke and applied in Hill, Bailey could not rely solely on Hi-Tech’s promise to provide security services to Evergreen to establish a claim against Hi-Tech. Because Bailey was not a party to Hi-Tech’s agreement with Evergreen and was not a third-party beneficiary under that agreement, Bailey had to plead and be able to prove that Hi-Tech breached a duty to him that was separate and distinct from Hi-Tech’s promises to Evergreen.
C. ANALYSIS
Here, Evergreen negotiated and entered into an agreement with Hi-Tech that obligated Hi-Tech to provide certain security services for Evergreen’s property. In accordance with the terms of its agreement with Evergreen, Hi-Tech assigned its security guards to the apartment complex where Schaaf shot Bailey. Although Hi-Tech had a contractual obligation to provide security guards who would presumably protect Evergreen’s property, tenants, and guests, Hi-Tech had no legal duty to provide such protection because, under Michigan’s common law, a person generally does not have a duty to protect or intervene to help others who might be in danger. See Williams v Cunningham Drug Stores, Inc,
Bailey did not allege that Hi-Tech had possession and control over the premises at issue; accordingly, Hi-Tech had no duty to keep the common areas safe. See Duffy v Irons Area Tourist Ass’n,
Finally, Bailey did not allege that Hi-Tech’s employees breached their common-law duty to act with ordinary care by creating a new hazard or increasing the danger posed by an existing hazard; given the allegations, the danger posed by Schaaf was the same without regard to Baker and Campbell’s presence at the apartment complex. See Hill,
If Hi-Tech and its employees had any duty to protect Bailey or otherwise intervene on his behalf, that duty was solely a matter of the contractual agreements between Hi-Tech, its employees, and Evergreen. While Evergreen might be able to recover for a beach of the agreement to provide security services should it ultimately be held liable for the Hi-Tech employees’ failure to properly respond to the events, Bailey cannot rely on Hi-Tech’s purported breach of the agreement with Evergreen to establish his tort claim. See Hart,
III. VICARIOUS LIABILITY AND AGENCY
A. STANDARDS OF REVIEW
We next consider Evergreen and Radney’s argument that this Court should affirm the trial court’s decision to dismiss Bailey’s claims under the rule stated in Al-Shimmari, All Mich 280. On appeal, Evergreen and Radney contend that Bailey’s claims against them are premised on the failure of their purported agents, Baker and Campbell, to involve police officers and, under our Supreme Court’s decision in Al-Shimmari, the claims against them as principals must be dismissed because the claims against their agents were dismissed. This Court reviews de novo a trial court’s decision on a motion for summary disposition. Barnard Mfg,
B. PRESERVATION
As a preliminary matter, we must address whether Evergreen and Radney properly preserved this issue for appeal.
In February 2009, Evergreen, Radney, Hi-Tech, Campbell, Baker, and Johnson moved for summary disposition under MCR 2.116(C)(8). In their motion and brief, they argued that the claims against them must be dismissed because Bailey failed to properly plead that any one of them breached a duty owed to Bailey. Specifically, they maintained that Michigan law does not impose a duty on premises possessors, such as Evergreen or Radney, to provide security or make their premises safe from criminal activity, and does not impose a duty to protect or aid others. They did not address Evergreen or Radney’s vicarious liability for any tort committed by Baker or Campbell and did not raise or discuss our Supreme Court’s decision in AlShimmari.
The trial court held a hearing on the motion in March 2009. At the hearing, defendants’ lawyer began by arguing that the individual defendants — Johnson, Baker, and Campbell — plainly had no duty to protect or aid Bailey. After defendants’ lawyer summarized his position as to the duty owed by the individual defendants, the trial court interrupted:
Well, let’s stop there for just a second. Mr. Robinson [addressing Bailey’s lawyer], that’s probably the part that I have the most difficulty with from your position. How [are] Tim Johnson and these individuals personally liable? This is a corporation. How are they personally liable? I don’t even believe there’s been an allegation that would suggest the piercing of the corporate veil or any ultra [sic] ego theory. How are they personally liable?
In response, Bailey’s lawyer stated that he was “really not contending that” and noted that he had not “address[ed] that in our response.” After this brief colloquy, the trial court granted the request for dismissal as to the claims against the individual defendants. The trial court went on to rule that Evergreen, Radney, and Hi-Tech also had no duty to provide security or to otherwise protect or aid Bailey. In May 2009, the trial court entered an order dismissing the claims against each defendant other than Schaaf that was consistent with that determination.
As can be seen, Evergreen and Radney did not argue before the trial court that Bailey’s claims against them had to be dismissed once the trial court determined
In civil cases, Michigan courts generally follow the rule that a “a litigant must preserve an issue for appellate review by raising it in the trial court.” Id. This “raise or waive”
By limiting appellate review to those issues raised and argued in the trial court, and holding all other issues waived, appellate courts require litigants to raise and frame their arguments at a time when their opponents may respond to them factually. This practice also avoids the untenable result of permitting an unsuccessful litigant to prevail by avoiding its tactical decisions that proved unsuccessful. Generally, a party may not remain silent in the trial court, only to prevail on an issue that was not called to the trial court’s attention. Trial courts are not the research assistants of the litigants; the parties have a duty to fully present their legal arguments to the court for its resolution of their dispute. [Id. at 388 (citations omitted).]
When a litigant waives appellate review by failing to properly preserve a claim of error, although under no obligation to do so, this Court may exercise its discretion to consider the claim.
Whether Al-Shimmari applies to this case is solely a question of law that requires no further factual development and plainly implicates the proper determination of the case. See Smith,
C. AGENCY AND TORT LIABILITY
In order to properly understand the decision in Al-Shimmari and how it might apply to the facts of this case, it is useful to briefly summarize the law of agency as it applies to a principal’s vicarious liability for the torts of the principal’s agent, an agent’s liability to third parties for the agent’s own torts, and a principal’s direct liability for the principal’s own torts.
A principal may be vicariously liable to a third party for harms inflicted by his or her agent even though the principal did not participate by act or omission in the agent’s tort. See Al-Shimmari, 477 Mich at 294. “Vicarious liability is indirect responsibility imposed by operation of law.” Theophelis v Lansing Gen Hosp,
A principal, however, remains directly liable for his or her own tortious conduct. See Cox v Flint Bd of Hosp Mgrs,
As for an agent, he or she is personally liable for his or her own tortious conduct, even when acting on behalf of his or her principal. Dep’t of Agriculture v Appletree Marketing, LLC,
As our Supreme Court recognized more than 100 years ago, when an agent breaches a duty owed solely to his or her principal, a third party may not rely on that breach to establish a tort claim; but when the agent breaches a separate duty owed to the third party, the third party may hold the agent liable:
“It is often said in the books that an agent is responsible to third persons for misfeasance only, and not for nonfeasance. * * * But, if the agent once actually undertakes and enters upon the execution of a particular work, it is his duty to use reasonable care in the manner of executing it, so as not to cause any injury to third persons which may be the natural consequence of his acts; and he cannot by abandoning its execution midway, and leaving things in a dangerous condition, exempt himself from liability to any person who suffers injury by reason of his having so left them without proper safeguards. This is not non-feasance, or doing nothing, but it is misfeasance, — doing improperly.” [Ellis,76 Mich at 241 , quoting Osborne v Morgan, 130 Mass 102, 103 (1881).]
Although no longer framed as a matter of misfeasance versus nonfeasance, this rule is consistent with modern application of the rule:
[C]onduct that breaches an agent’s duties to the principal does not always, additionally, subject the agent to liability to a third party although the agent’s conduct also harms the third party. An agent is subject to liability to a third party only when the agent’s conduct breaches a duty that the agent owes the third party. The duty may be derived from tort law, from a contract between the third party and the principal when the agent is a party to the contract, from a promise made by the agent to the principal for which the third party is an intended third-party beneficiary, or from the agent’s assumption of duties toward the third person that are independent of the duties the agent owes the principal. [2 Restatement Agency, 3d, § 7.02, comment b.]
Because the distinction between misfeasance and nonfeasance is analogous to that addressed by the Fultz line of cases discussed earlier in this opinion, the analytic framework applied in Fultz applies equally to determining whether an agent can be liable in tort to a third party. Accordingly, a plaintiff cannot sue an agent to recover for harm caused by the agent’s breach of a duty owed solely to his or her principal. Rather, the plaintiff must allege and be able to prove that the agent breached a duty that was separate and distinct from his or her agency agreement with the principal. See Fultz,
D. AL-SHIMMARI
With these basic principles of agency law in mind, we now examine our Supreme Court’s decision in AlShimmari. In that case, Abdul Al-Shimmari sued his surgeon, Dr. Setti Rengachary, and several institutional defendants after he discovered that he had suffered a nerve injury during a surgery that Rengachary performed. Al-Shimmari,
The Court first noted that Al-Shimmari’s claims against the institutional defendants were premised solely on their vicarious liability for Rengachary’s alleged negligence (there were no claims against the institutional defendants involving direct liability). Id. at 285, 294-295. The Court then examined MCR 2.504(B)(3) and determined that the dismissal of the claim against Rengachary constituted an adjudication on the merits under that rule. Id. at 295. Because the dismissal of the claim against Rengachary amounted to a dismissal on the merits, Al-Shimmari could no longer argue the merits of the claim against Rengachary and, therefore, could not impute Rengachary’s negligence to the institutional defendants. Id. at 295-296. For that reason, the Supreme Court determined that Al-Shimmari’s vicarious-liability claims against the institutional defendants had to be dismissed. Id. at 297.
As explained by our Supreme Court in AlShimmari, a principal cannot be held vicariously liable for his or her agent’s alleged tort if the trial court dismisses the claim against the agent and that dismissal constitutes an adjudication on the merits. This is so because the plaintiff can no longer argue the merits of
If a plaintiffs claim against the principal does not involve an agent’s breach of a duty that the agent separately owed to the third party, that claim does not involve true vicarious liability and the dismissal of the plaintiffs claims against the agent will not constitute an adjudication on the merits as to whether the agent’s acts or omissions constitute the breach of duty independently owed by the principal. Similarly, in those situations in which a plaintiff has alleged separate claims of vicarious and direct liability against the principal on the basis of an agent’s conduct, the dismissal of the claims — if any — against the agent will only constitute an adjudication on the merits as to those claims against the principal involving true vicarious liability. Accordingly, if Bailey’s remaining claims against Evergreen and Radney are not solely based on vicarious liability— that is, do not solely depend on holding Evergreen and Radney liable for a tort committed by Baker and Campbell — the dismissal of the claims against Baker and Campbell will not constitute an adjudication on the merits under Al-Shimmari.
E. APPLYING THE LAW
In his second amended complaint, Bailey did allege that Evergreen and Radney were vicariously liable for any torts committed by Hi-Tech, Baker, or Campbell. But he also alleged that his injuries were caused by Evergreen’s failure to keep its premises safe and by both Evergreen and Radney’s negligence in hiring, supervising, and retaining Hi-Tech. That is, he plainly alleged traditional claims of direct liability against both Evergreen and Radney. Although this Court eventually determined that Bailey failed to state claims against Evergreen and Radney to the extent that his complaint alleged that Evergreen and Radney had a duty to provide security or make its premises safe from criminal activity, this Court nevertheless determined that Bailey’s allegations were sufficient to state a claim that Evergreen and Radney — as landlords or premises possessors — breached their duty to adequately respond to an ongoing criminal emergency. Bailey,
Evergreen and Radney had a common-law duty to their invitees: they had to expedite the involvement of the police “when a situation presently occurring on the premises pose[d] a risk of imminent and foreseeable harm to identifiable invitees.” Bailey,
Moreover, the fact that Evergreen or Radney contracted with Hi-Tech to meet their duty to involve the police did not relieve them of direct liability should Hi-Tech fail to perform its contractual duty. Fultz,
We acknowledge that it might appear incongruous to hold that a principal can be liable for a breach of duty that was caused by its employee or agent’s actions while nevertheless holding that the employee or agent’s actions do not amount to a breach of duty by the employee or agent in his or her individual capacity. This is particularly true where, as here, the principal’s duty would not have been triggered had its security personnel not been informed of the ongoing emergency.
But the same would be true even if Hi-Tech and its employees had not been in the business of providing security. If Evergreen and Radney had hired Hi-Tech to provide maintenance, and had Baker and Campbell been informed of the ongoing emergency while they were conducting maintenance, the outcome might be the same; Bailey could similarly have alleged that Baker and Campbell were Evergreen and Radney’s agents, that Evergreen and Radney had notice of the ongoing emergency through their agents, and that their knowledge triggered a duty to involve the police, which Evergreen and Radney breached by failing to call the police. See New Props, Inc v George D Newpower, Jr, Inc,
iv conclusion
The trial court did not err when it determined that Bailey failed to allege that Hi-Tech breached a duty to him that was separate and distinct from its obligations under its agreement with Evergreen to provide security services. For that reason, we again conclude that the trial court properly dismissed Bailey’s claim against Hi-Tech. Bailey’s remaining claims
Affirmed in part, reversed in part, and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction. As the prevailing party, Bailey may tax his costs. MCR 7.219(A).
Notes
In our prior opinion, we rejected Bailey’s argument that the trial court erred when it dismissed his third-party beneficiary claim. See Bailey,
We recognize that there is a distinction between the terms “waiver” and “forfeiture” in Michigan law. See Walters,
In contrast to civil cases, Michigan courts will review even unpreserved errors from criminal trials; we will do this to ensure the defendant’s constitutional right to a fair trial. See Napier v Jacobs,