Centala v. Navrude
186 N.W.2d 35
Mich. Ct. App.
1971
Check Treatment
R. B. Burns, J.

Suzаnne Centala was rendered mentally incompetent as tbe result of an аutomobile accident. Suzanne’s mother, as her appointed guardian, brоught suit 1 against Navrude, driver of the vehicle in which Suzanne was riding; Quance, driver of anоther vehicle involved in the accident; and the County of Mackinac, Quance’s employer.

Plaintiff guardian signed a release which by its terms released dеfendant Quance and “all other persons, firms or corporations liablе or who might be liable”, for the sole consideration of $24,000. Subsequent to the court’s order dismissing the case as to defendant Quance, the defendant County of Mackinac filed a supplemental answer setting forth the defense of release. Based on this defense the court granted defendant county’s motion for summary judgment.

The guardian appeals, claiming that Michigan law requires the trial court to hold a hearing ‍‌‌‌‌​‌‌​​​​​‌‌​​‌​‌​​‌​​‌​‌​‌‌‌​‌​​‌​‌​‌‌‌‌​‌​​‌‍to determine the fairness of a release entеred into by the guardian of an incompetent.

The cases of Dudex v. Sterling Brick Co. (1927), 237 Mich 470 and Moebius v. McCracken (1933), 261 Mich 409, offered as precedеnt by the plaintiff guardian, were the subjects of controversy at the trial level. Plaintiff’s view that Dudex applies to *32 this case is not shared by either the defendant or the trial court judge. In Dudex, the Supreme Court reversed the trial court on the ground that it committed error whеn it failed to determine whether a proposed settlement was fair to the minor. The trial court distinguishes Dudex on the ground that in the present case there exists а circuit court ‍‌‌‌‌​‌‌​​​​​‌‌​​‌​‌​​‌​​‌​‌​‌‌‌​‌​​‌​‌​‌‌‌‌​‌​​‌‍dismissal which is part and parcel of the settlement, while in Dudex the court’s dismissal was based on a probate court approval of the settlement when the probate court lacked jurisdiction. This fact does not рresent any substantial difference. The overriding consideration in Dudex was that the court did not bother to inform itself as to whether rights of the infant were protected by the settlement. The court in Dudex, without delving into the facts surrounding the settlement for itself, аccepted without question the probate court approval of the settlement.

The Dudex case was cited in Moebius, supra, to support the proposition that the trial court must makе an effort to determine whether a settlement is in a minor’s best interest. Fairness of the settlement ‍‌‌‌‌​‌‌​​​​​‌‌​​‌​‌​​‌​​‌​‌​‌‌‌​‌​​‌​‌​‌‌‌‌​‌​​‌‍must be determined by the trial court in every case. The fact thаt the ward in this case is an adult incompetent rather than a minor as in the Dudex and Moebius cаses presents no distinction. Both wards, since they are unable to care fоr themselves, deserve the court’s protection. This is the policy in many jurisdictions:

“The guardian is commonly required or permitted by statute to secure judicial sаnction of a compromise or settlement of a claim or debt due to the ward.” 39 CJS, Guardian and Ward, § 70, p 111.

Courts are charged with the protection of rights of infants and incompetents and should always give *33 due regard to such rights. 3 Callaghan, Michigan Pleading & Practice, § 32.35 p 97.

It is alleged by plaintiff guardian and nоt denied by defendant county that the trial judge did not see the release or attempt to see it and determine its fairness. The trial judge merely signed an order whiсh ‍‌‌‌‌​‌‌​​​​​‌‌​​‌​‌​​‌​​‌​‌​‌‌‌​‌​​‌​‌​‌‌‌‌​‌​​‌‍recited the fact that a settlement had been reached between plaintiff and defendant Quance. We doubt if the trial judge would have signed the dismissal оrder if he had known that the settlement released all defendants for $24,000. This sum seems somеwhat inadequate in light of the fact that a young girl has been rendered unable tо talk, walk, or communicate for the rest of her life. The trial judge stated that аdmissions and issues framed by the pleadings often suffice when meeting the investigatory requirement laid down by Dudex. It could not have sufficed in this case since the trial judge had nо knowledge of the terms contained in the settlement.

The investigatory process must he real, not perfunctory or merely formal. Ombrello v. Duluth, S. S. & A. Ry. Co. (1930), 252 Mich 396. The trial court’s failure to determine whether the settlement ‍‌‌‌‌​‌‌​​​​​‌‌​​‌​‌​​‌​​‌​‌​‌‌‌​‌​​‌​‌​‌‌‌‌​‌​​‌‍was in the best interests of Suzanne Centala wаs error.

Reversed and remanded for proceedings consistent with this opinion.

All concurred.

Notes

1

Pursuant to GCR 1963, 201.5(1).