*1 Aрp MUTUAL INSURANCE MILLERS SABRAWv MICHIGAN COMPANY INSURANCE MILLERS MUTUAL v MICHIGAN BULLOCK COMPANY MUTUAL INSURANCE MILLERS v MICHIGAN CSUTORA COMPANY INSURANCE MILLERS MUTUAL HANSEN v MICHIGAN COMPANY INSURANCE MILLERS MUTUAL v MICHIGAN WAUGH COMPANY 77-498, 77-499, 77-496, 77-497, 77-495, 77-500. Submitted Nos. Docket 1978, 8, 21, Lansing. December 1978. Leave June Decided appeal applied for. by Farm Bureau mill owned at a feed An occurred explo- employees killed or were Services. Several Saginaw brought damages Circuit Complaints were sion. Sabraw, the estate of administratrix of Alvia G. Court Bullock, Sabraw, administratrix of Helen J. T. Lowell Csutora, Bullock, himself аnd as Michael estate of Clarence Csutora, James and Pauline the estate of Alex administrator of Hansen, Waugh against Michigan Millers Mu- and Donald H. Company consoli- others. The cases were tual Insurance of each verdicts in favor trial. The returned dated for Millers, Joseph Michigan R. plaintiff, upon motion of but McDonald, J., judgment the verdict entered appeаl. Michigan plaintiffs Held: favor of Millers. The regarding of the The evidence the defendant’s [1, [2] Practice and Liability 3, sulting ALR3d 1262. withstanding dure Rule 4] Am Jur 46 Am Jur insurance: 2d, 50(b) References procedure Insurance or in default ordinary 2d, or like state Judgments "accident or accidental” with §§ negligence 1182, of verdict under respect Points in provisions. 117. 1413. of insured Headnotes motions for 69 ALR2d Federal Civil including or 449. judgment agent. 7 loss Proce- not- re- Sabraw v parties knowledge was sufficient question jury’s whether the defend- justify verdict. The fire hazards gratuitously the mill for undertook to ant ample evidence of fact which there is a *2 granting judgment the presented. in The trial court erred' notwithstanding the verdict. jury ver- for reinstatement Reversed and remanded dicts. Clements, J., that the trial hold dissented. He would determining authority the issue of the its court was within employees duty matter of law because the as a defendant’s presented a to create insufficient evidence there was voluntarily had question the defendant on the issue of whether entry duty employees, of and that the a toward the assumed proper. notwithstanding
judgment verdict was the Notwithstanding Judgment Judgment the Verdict —Evidence 1. — of Fact. —Question judgment grant notwithstand- motion for a of a defendant’s only ing appropriate is insufficient if the evidence the verdict is plaintiff, judgment the of law to a matter every inference giving plaintiff reasonable the the benefit evidence; could reasonable men from the if that can be drawn plaintiff disagree satisfied his honestly has as to whether necessary proof cause оn the elements burden of action, improper. notwithstanding judgment verdict is Negligence Insurers—Safety Inspections. 2. — proxi- consequences may An insurance carrier be held liable negligent safety inspections. mately caused Notwithstanding Judgment Judgment the Verdict —Evidence 3. — of Fact. —Question verdict, judgment notwithstanding of a defendant in favor A plaintiffs were fire insurer of a feed mill which mill, improper when occurred in the a dust insurer of fact as to whether where there was a hazards, gratuitously mill for undertook to evidence, point ample and where upon which there was actions insurer’s jury reasonably that the could have concluded failure insurer’s that the care or constituted want reasonable dangers mill caused warn of the to detect and plаintiffs’ injuries. Opinion op the Court M. E.
Dissent Judgment Judgment Notwithstanding 4. — the Verdict —Insur- Duty—Evidence. ance — properly
A duty trial court determined the issue of as a matter of by granting law property judgment a defendant insurer a injuries the verdict in an action for wrongful employees death to of the insured where the defend- safety inspections ant insurer had made of a directed ñre, preventing pre- where there was insufficient evidence jury questions sented to create on the issue of whether the voluntarily duty insurer had assumed a toward the feed mill employees undisputed and where there was evidence that the regard insurer exercised no control in the feed mill with employee safety. Cicinelli, Mossner, Alexander, P.C., Majoros & plaintiffs Sabraw, Bullock, Csutora and Hanes. Martin, Mаrtin & for plaintiff Waugh. *3 Otto,
Otto & Purcell, Cline, P.C., Tunison & for defendant.
Amici Curiae: Rowe, Joselyn, Jamieson & Grin- nan, P.C., for the Alliance of Insurers, American American Insurance Association and National As- sociation of Independent Insurers.
Before: R. B. Burns, P.J., and D. F. Walsh and Clements,* JJ. D. Walsh, F. J. Plaintiffs appeal by right the trial court’s entry of judgment notwithstand- ing the verdict in favor of defendant Michigan Millers Mutual Insurance Company.
The complaints arose out of an Farm Bureau Services’ Zilwaukee Feed Mill on
* judge, sitting Circuit Appeals by assignment. on the Court of Sabraw v op Opinion the Court plaintiffs September 15, 1969. Three of the were explosion; plaintiffs three the other explo- persons represent of killed in the the estates employees of All the casualties were Farm sion. of the time of the accident. Bureau at Michigan Millers was the fire insur- Defendant for the Zilwaukeе mill.1 ance carrier consolidated individual actions were Plaintiffs’ Jury of each rendered in favor for trial. plaintiff verdicts the trial court on the
were set aside insufficient to raise a that the evidence was basis pro- of fact for determination. only priety the, issue trial court’s action is we shall address.2 notwithstanding judgment the verdict on de-
A appropriate only if the еvi- fendant’s motion is insufficient as a matter of law dence is plaintiff. judgment Fox, 69 Jackson v for the (1976). making In 283; 244 NW2d Mich give plain- determination, must the court every tiff the reasonable inference benefit Katz, Kroll v from the evidence. could be drawn (1965). If reasonable disagree honestly the the as to whether men could plaintiff proof on has satisfied his burden judg- necessary action, his causе of elements of improper. the verdict ment supra. supra; Katz, Fox, v Kroll Jackson premised Plaintiffs’ cause action p Torts, 2d, 324A, Restatement 142: compensation Company, Fireman’s Fund Insurance the worker’s mill, originally but was carrier for the named as a defendant appealed. granted plaintiffs Mill verdict which have not a directed *4 Company, Michigan Millers’ rein- Elevatоr Mutual Insurance and surer, third-party of the above was a defendant. Insofar as neither parties Michigan appeal, refer to we shall hereinafter are involved in this as the defendant. Millers 2 considering necessity disposition this Our issue obviates erroneously plaintiffs’ excluded. claim that certain evidence was App Mich 568 572 undertakes, gratuitously "One who or for considerа- tion to render services to another which he should recognize person person protection necessary for the of a third to the third as things, subject liability his or resulting physical harm from his failure to if undertaking, protect exercise reasonable care to "(a) his failure to exercise care increases reasonable harm, or the risk of "Ob) perform duty by he has undertaken to owed or person, other to the third
"(c) the harm is suffered because of reliance of the
(Em-
person upon
undertaking.”
other or the third
phasis supplied.)
apply
That section has been held to
to insurance
carriers
so as to render
them liable for conse-
quences
caused
their
proximately
negligent
e.g., Olkowski v Aetna
&
inspections;
Casualty
Co,
Surety
497;
(1974),
53 Mich
App
cles5 trial the gist The of to as a "Bobcat”.6 truck referred reasonably plaintiffs’ careful that case was representative, by inspection field the defendant’s prevented danger and that detected have would the explosion._ hazards the detection of fire "Factory concerned with Mutual was specially trained in this area. employed who were individuals and employees safety purpose. training area of Factory no in the Mutual had of making inspections for this they out hold themselves as nor did equipment or Factory the electrical Mutual did not virtually material. they no combustible contained because the cranes Faсtory
Furthermore, if the any Mutual make difference it did not ungrounded grounded because or cranes were around the circuits ” added.) (Emhasis posed Id. at 356. a ñre hazard. neither scope asserting that the of thus is correct The instant defendant wrong parameter. limited, inspection it focuses on the was but its (i.e., property by injured or Liability what was is not circumscribed (whether damagе caused by was persons) it but how was inspection). scope purpose If by and hazard within imposing reasoning provides anything, liability in Smith case, injuries plaintiffs’ from a derived since in the instant inspec- scope purpose patently of defendant’s within hazard tion. prevail appeal any theories of one of their on the evidence. if Plaintiffs will Consequently, not liability attemрt we determine one supported by we shall evidentiary support theories once of additional assess the proof to create a sufficient have elements. each ingre converting raw production operation consisted of The mill’s corn, oats, soybeans food concentrate into wheat and dients such cattle, ingredients at pigs. received of the raw chickens and Most for the mill were highly ground powdery was finely material which air. explosive concentration 10-15% parties generally accepted theory precisely, the More ignited muffler the Bobcat was caused when corncob, and was ground fell unnoticed particles which some of dumped into a unignited That material material. buried storage it rose to hopper upward bins where into and carried ignited adjacent dust. surface Opinion op the Court undisputed It was the defendant’s field representative inspec- had conducted numerous purpose detecting tions7 of the mill for the employees hazards. He knew that a number building they worked in the and that would be explosion. harmed fire or He was aware of the explosive potential overtly of the dust8 and was *6 detecting eliminating possible concerned with ignition.9 sources of ignition
The Bobcat constituted an hazard10 and Although should not have been used indoors. it exclusively indoors, used almost defendant’s representative field stated that he had never seen any inspections. it inside in the course of of his Consequently, he never advertеd it to as a fire reports superiors hazard his to his or in his 11 management. discussions with Farm Bureau’s 7 representative Defendant’s field conducted between 22 and 30 1969, including inspections of the mill between 1963 and 6 preceding explosion. average the 9 months the The duration of the inspections was between one and two hours. representative explosive potential Defendant’s field estimated its dynamite. as seven times that of possible ignition He testified that he had been concerned about cigarette, spark from a a match or even a from a nail on a workman’s suggestion, Smoking” signs shoe. At posted his "No had been various locations in the mill. expert Plaintiffs’ witness testified that the use of the Bobcat entirely improper inside propensity the mill wаs because for initiating explosions; only explosion-proof fires or electrical trucks equipment with sealed should have been used. representative Defendant’s February field testified that in of 1969 forcefully he amount of dust of urgency system. management informed the Farm Bureau the alarming in the mill at that time constituted an risk explosion. point immediate At that he renewed with inсreased suggestion that Farm Bureau install a dust control reprimand For his superiors efforts he received a from his "going through not apol channels”. Farm Bureau received written ogy of the system from the defendant. No dust control was installed because closing plant days economic ramifications of the for 30 to permit installation. Although representative’s recognition danger the field of the analytically negligence dust danger detecting distinct from his in not Bobcat, posed by dilatory Farm Bureau’s conduct in Sabraw v pro- safety
Although own Bureau had its Farm safety gram, Conse- no director. it had fulltime quently, to carriers were relied insurance problems. degree point safety out some safety representative committee for mill’s impression complex under the Zilwaukee inspect- representative was field that defendant’s safety ing employees’ and he relied inspections. Farm Bureau executives Two those any urgent they received had not testified that warning danger or fire at imminent mill. jus- foregoing evidence sufficient find the We jury’s tify the defendant verdicts. Whether gratuitously the mill for fire undertook to fact, Insurance Andrews v is a hazards Company America, 190; 230 60 Mich of North reconsideration, remanded NW2d 371 (1975),Megge, supra, ample point. Fur- on that evidence was and the representative thermore, admit- defendant’s field danger fire and ted that he realized *7 employees. explosion posed for the mill’s
inspections, of the From the number and extent frequency was used with which the Bobcat the indoors, danger ignition apparent as an
and its reasonably jury hazard, concluded could have inspector’s the Bobcat or failure to notice that to realize its
dangerousness
want of
constituted
Moning Alfono, 400 Mich
reasonable care. See
purely
tolerating
danger posed by
motives
the dust for
economic
irresponsible
say
reminiscent
the least. Its attitude was
era,
bygone
"public
philosophy
be
that dominated a
damned”
compensation
state
law in this
current
of the worker’s
framework
may
It
of its recklessness.
it from the economic ramifications
insulates
be that
such as exist in 14 other states
provisions
enacting penalty
Legislature
consider
should
liability
impose
which
increased
Larson,
Compensation
egregious
2A
Workmen’s
such
conduct. See
Law, 69.10.
App
Clements,
by
Dissent M. E.
J.
(1977). Similаrly,
jury
425;
Although prece- we are bound line of clear dent, we view the result in the instant case with possible impact some reservation because of its inspection practices of fire insurers.13 The Legislature might be well-advised to consider ac- comparable respect tion taken with compensation 418.131; worker’s carriers. MCL 418.827(8); MSA 17.237 (827)(8). MCL MSA 17.237 so, however, Until it does fire insurance subject liability carriers remаin to common law damages resulting negligent from un- der those circumstances enumerated in 2 Restate- supra. Torts, 2d, ment
Reversed and remanded for reinstatement of the appellants. verdicts. Costs to Burns, P.J., R. B. concurred. (dissenting). appeal Plaintiffs entry judgment the ver-
dict favor of the defendant. A review of the record indicates to this writer judge granting that the trial did not err JNOV. impracticаl text is the are we unaware of evidence. We have factual the amount and encompassing summary of the voluminous record before us is both But see *8 (1973). We are not exposition necessary only Ray suggesting one legally unnecessary. v Transamerica Ins consciously supportable that the to decide the issue before us—a more restricted ourselves to the minimum the evidence. See fn theory probative Co, liability force of the defendant’s described 3, supra. Nor v Mich Millers Ins Sabraw E. Dissent M. relationship Michigan between Millers The employer plaintiffs’ was Farm Bureau Services Michigan provided property insur Millers clear. safety inspections directed at and its were ance preventing collaterally, result, fire as premises. protection of The trial workers authority determining judge was within duty Ray v a matter of law. Transamer issue (1973). Co, ica Ins inspector testimony was The of the defendant’s designed unequivocal. solely His were having pay protect against Michigan to Millers policy it issued Farm under the insurance inspector Bureau elsewhere con- Services. had safety inspections, which were ducted than the Zil- more extensive those conducted inspector’s testimony mill. The waukee feed igni- provided the he never saw the Bobcat which the mill tion source for inside not contradicted.
Additionally, testimony of Farm Bureau Services officials convinces me
Farm Bureau Michigan rely Millers Services did not on concern- ing example, employee safety. Callum, for Williаm accepted testified that Farm Bureau Services never inspector’s findings doing inde- without own pendent investigation. safety There was a commit- repre- tee which the feed mill sent Zilwaukee sentative. Co,
inAs Smith v Allendale Mutual App I would affirm entry com- JNOV defendant fire insurance presented pany. There was insufficient evidence jury questions trial to create issue voluntarily аssumed a whether defendant had duty employees. towards Evidence undisputed that exercised no con- defendant *9 App 568 Mich Dissent regard mill with in the feed trol of North Company Andrews v Insurance safety. (1975), America, 190; 230 NW2d App 60 Mich remanded, Wausau, Ins Co of v Employers
Watson (1973). that defend- no evidence plaintiffs presented towards obligation any had undertaken ant element of a The threshhold mill employees. Restatement premised of action cause proven. not Torts, 2d, 324A was therefore affirm. dissent and vote to respectfully I