Ward v. Consolidated Rail Corp.

                                                                     Michigan Supreme Court
                                                                           Lansing, Michigan
                                              Chief Justice:	          Justices:



Opinion                                       Clifford W. Taylor 	     Michael F. Cavanagh
                                                                       Elizabeth A. Weaver
                                                                       Marilyn Kelly
                                                                       Maura D. Corrigan
                                                                       Robert P. Young, Jr.
                                                                       Stephen J. Markman




                                                          FILED MARCH 8, 2005

  WILLIAM FRANK WARD,

       Plaintiff-Appellee,

  v                                                                     No. 124533

  CONSOLIDATED RAIL CORPORATION,


       Defendant-Appellant.

  _______________________________

  PER CURIAM

       The issue before us concerns the consequence, if any,

  of defendant’s inability to produce an allegedly defective

  locomotive handbrake at trial.

       In this case, the trial court instructed the jury that

  because   defendant       disposed    of    the        handbrake,           it    was

  presumed to be defective and the jury could infer that the

  missing   evidence     was    unfavorable        to       defendant.             This

  instruction   was    given    despite      the      fact      that      defendant

  produced evidence that it discarded the handbrake in the

  regular   course     of   business,       for    reasons           unrelated       to

  plaintiff’s   claim.         The   jury     returned          a     verdict       for
plaintiff.         The Court of Appeals affirmed, in part, and

remanded.1

      We conclude that the jury instructions were flawed in

two   respects.           First,    the        trial    court     erred      when    it

instructed the jury that the handbrake was presumed to be

defective.         Such a presumption is not supported by the

evidence.      Second, the trial court erred when it instructed

the   jury    that    it    could    draw       an     adverse    inference,        but

failed to explain that no inference should be drawn if

defendant     had     a    reasonable          excuse    for     its   failure       to

produce      the   evidence.         Because          these    errors     were      not

harmless,     we     reverse   the      part     of     the    Court    of   Appeals

judgment concerning the Federal Safety Appliance Act, 49

USC 20302, and remand this case for a new trial on that

claim before a properly instructed jury.

                                   I.     BACKGROUND

      Plaintiff, a railroad engineer, claimed that he was

injured by a faulty handbrake that he was using to secure

one of defendant’s locomotives.                  The braking system employs

two control levers.            The brake is engaged by moving the

application lever in an up-and-down arc; each upward stroke

tightens a chain that runs from the lever to the brake.


      1
       Unpublished opinion per curiam, issued August 7, 2003
(Docket No. 234619).

                                          2

The brake is disengaged through a separate release lever.

Plaintiff         claimed    that     his        back    was     injured       when     the

application lever unexpectedly stopped while he was in the

middle of an upward stroke.2

       Plaintiff reported his injury to his employer the next

day.        Defendant       had    inspected       the     locomotive          four   days

before plaintiff’s accident and the handbrake was working

properly at that time.               In response to plaintiff’s injury

report, the entire handbrake assembly was inspected again,

this       time    by   defendant’s         trainmaster          and     a    locomotive

machinist.          They     took    apart       and     examined       the    assembly,

including         the   levers,     brake        chain,     and    gear       mechanism.

They determined that the handbrake was functioning properly

and returned the locomotive to service.

       Defendant’s          employees       then        operated       the    locomotive

regularly for more than two weeks, successfully using the

application lever to engage the brake.                         Nineteen days after

plaintiff’s injury, one of defendant’s employees reported

that the release lever jammed and that the handbrake could

not be disengaged.                The locomotive was moved to a repair

facility      in    Elkhart,       Indiana,       where     it     was       examined   by


       2
       Defendant’s trainmaster had once before experienced
difficulty engaging the handbrake; the evidence showed that
this is a fairly common occurrence and is not considered a
defect in the brake.

                                            3

defendant’s        maintenance       supervisor.              He     removed     and

discarded the entire handbrake assembly and installed a new

one.       The Elkhart maintenance supervisor was unaware of

plaintiff’s        earlier    report        of     a    malfunction         in   the

application lever.

       Plaintiff     filed    this    lawsuit          more   than    ten    months

later.      He theorized that the application lever stopped in

mid-stroke because of the presence of a repair link, or

clevis, in the brake chain.             He alleged that defendant was

negligent     under     the     Federal          Employers’        Liability     Act

(FELA), 45 USC 51 et seq., and that defendant violated both

the Federal Locomotive Inspection Act (FLIA), 49 US 20701

et seq.,3 and the Federal Safety Appliance Act (FSAA), 49

USC 20302.4

       In a motion for partial summary disposition, plaintiff

informed     the    trial     court    that       defendant        discarded     the

entire handbrake assembly and argued that he was entitled




       3
       The FLIA states, in relevant part, that a railroad
carrier may “use or allow to be used a locomotive or tender
on its railroad line only when the locomotive or tender and
its parts and appurtenances . . . [a]re in proper condition
and safe to operate without unnecessary danger of personal
injury . . . .” 49 USC 20701(1).
       4
       The FSAA states, in relevant part, that a railroad
carrier may “use or allow to be used on any of its railroad
lines . . . a vehicle only if it is equipped with . . .
efficient hand brakes . . . .” 49 USC 20302(a)(1)(B).

                                       4

to    a   presumption      that     the   handbrake     was    defective.

Defendant argued that no adverse presumption should be made

because the handbrake was discarded in the ordinary course

of business following a malfunction in the release lever—a

mechanism different from the one plaintiff theorized caused

his   injury.       Defendant     supported   its     position    with    an

affidavit    from   its    Elkhart    maintenance     supervisor.        The

trial court resolved this issue in plaintiff’s favor and

reaffirmed its ruling before the start of trial.

      The    jury    was     made     aware   of      the     presumption.

Plaintiff’s counsel said, during opening statement:

           And even though they knew about the injury,
      they knew about these claims, the defect in this
      hardware, they destroyed the evidence.        The
      railroad destroyed the evidence. They threw away
      the chain, they threw away the clevis, they threw
      away the entire handbrake even though they had
      this knowledge.   And it is for this reason that
      this Court has concluded there is a presumption
      in this case that this handbrake was defective
      when Mr. Ward went to use it and got hurt on the
      evening of February 19, 1998.

This theme was repeated during jury voir dire and closing

arguments.

      After the close of evidence, the trial court reminded

the jury of the presumption and instructed it that it could

infer that the missing evidence would have been unfavorable

to defendant:




                                     5

           The Court made a determination that there
      was a presumption that the handbrake at issue was
      defective due to the fact that the handbrake
      clevis and chain were discarded by defendant.
      The defendant railroad has come forward with some
      evidence to rebut this presumption. Accordingly,
      the law requires that I instruct you as follows:

           Certain evidence relevant to this case,
      namely the handbrake, the clevis and chain, were
      not   available  at   trial   because they  were
      destroyed while in the possession or control of
      the defendant.    The Rules of Evidence provide
      that you, the jury, may infer that this evidence
      was unfavorable to the defendant.

      The jury returned a verdict for plaintiff.         It found

that defendant was not negligent under the FELA and that

the handbrake was “in proper condition and safe to operate

without unnecessary danger of personal injury” as required

by   the   FLIA.   The   jury    concluded,   however,   that   the

handbrake was not “efficient” as required by the FSAA and

awarded plaintiff damages on this basis.

      Defendant appealed.       The Court of Appeals held that

the trial court properly granted plaintiff a presumption of

defect and properly instructed the jury.5

      Defendant now seeks leave to appeal with this Court.6




      5
       Defendant raised a total of thirteen issues in the
Court of Appeals. It obtained relief on one issue relating
to the calculation of case-evaluation sanctions.
      6
       We consider here only defendant’s claim that the
trial court erred when it granted plaintiff a presumption
that the missing handbrake was defective and when it

                                 6

                              II.     STANDARD OF REVIEW

          We review claims of instructional error de novo.                          Cox

v Flint Bd of Hosp Managers, 467 Mich 1, 8; 651 NW2d 356

(2002). Jury instructions should not omit material issues,

defenses, or theories that are supported by the evidence.

Case v Consumers Power Co, 463 Mich 1, 6; 615 NW2d 17

(2000).         Instructional         error        warrants       reversal     if   it

“resulted in such unfair prejudice to the complaining party

that      the   failure      to     vacate       the    jury    verdict    would    be

‘inconsistent         with        substantial          justice.’”         Johnson     v

Corbet,      423    Mich     304,    327;        377    NW2d   713   (1985);        MCR

2.613(A).

                                     III. DISCUSSION

          The trial court’s instructions to the jury blurred the

distinction between presumptions and inferences and were

not tailored to the evidence submitted by the parties.

          In Widmayer v Leonard, 422 Mich 280, 289-290; 373 NW2d

538       (1985),     we     explained           that     a    presumption     is    a

“procedural device” that entitles the person relying on it

to    a    directed    verdict        if    the        opposing   party    fails     to

introduce evidence rebutting the presumption.                          If rebuttal




instructed the jury on this issue. In all other respects,
defendant’s application for leave to appeal is denied.

                                            7

evidence is introduced, the presumption dissolves, but the

underlying inferences remain to be considered by the jury:

             Almost all presumptions are made up of
        permissible   inferences.      Thus,    while   the
        presumption   may   be    overcome   by    evidence
        introduced, the inference itself remains and may
        provide evidence sufficient to persuade the trier
        of fact even though the rebutting evidence is
        introduced.   But always it is the inference and
        not the presumption that must be weighed against
        the rebutting evidence. [Id. at 289.]

        It is well settled that missing evidence gives rise to

an adverse presumption only when the complaining party can

establish       “‘intentional      conduct    indicating       fraud    and    a

desire     to    destroy    [evidence]       and    thereby    suppress       the

truth.’”        Trupiano v Cully, 349 Mich 568, 570; 84 NW2d 747

(1957), quoting 20 Am Jur, Evidence, § 185, p 191; see also

Lagalo v Allied Corp (On Remand), 233 Mich App 514, 520;

592 NW2d 786 (1999).

        The evidence here does not warrant a presumption that

the application lever of the handbrake was defective.                     When

plaintiff requested the presumption, he established only

that he gave defendant notice that the application lever

had malfunctioned and that defendant discarded the entire

handbrake assembly approximately three weeks later.                       This

falls     short     of     establishing      that     defendant      committed

“'intentional       conduct    indicating      fraud     and   a     desire   to

destroy     [evidence]       and    thereby        suppress    the     truth.'”


                                      8

Trupiano, supra at 570, quoting 20 Am Jur, Evidence, § 185,

p 191.

     Moreover,     even     if   plaintiff’s     initial      evidentiary

showing   had      been     sufficient,     no     presumption       would

ultimately    remain      because   defendant     came     forward   with

rebuttal evidence that provided a nonfraudulent explanation

for its decision to discard the handbrake.                See Widmayer,

supra at 289.      Once defendant presented this evidence, the

initial presumption dissolved and, at best, the fact-finder

was left with the possibility of considering the underlying

inferences.     Id.    As a result, the trial court erred when

it granted plaintiff an unrebuttable, adverse presumption

that the handbrake was defective and allowed the jury to be

informed of its ruling.

     The trial court compounded this error when it read the

jury a modified version of M Civ JI 6.01 and instructed the

jury that it could infer that the evidence would have been

unfavorable   to   defendant.7       A   jury    may   draw   an   adverse



     7
       M Civ JI 6.01(c) addresses the situation, like this
one, where a party admits that it had control of evidence
but cannot produce it and seeks to offer a reasonable
excuse:

          (The [plaintiff / defendant] in this case
     has not offered [the testimony of [name] /
     [identify exhibit]]. As this evidence was under
     the control of the [plaintiff / defendant] and

                                    9

inference      against    a    party        that       has    failed     to   produce

evidence only when:           (1) the evidence was under the party’s

control and could have been produced; (2) the party lacks a

reasonable excuse for its failure to produce the evidence;

and (3) the evidence is material, not merely cumulative,

and not equally available to the other party.                                 Lagalo,

supra at 520; M Civ JI 6.01.                          In this case, the trial

court’s instruction omitted the critical language in M Civ

JI    6.01   explaining       that   no      adverse         inference    arises   if

defendant has a reasonable explanation for its failure to

produce the missing evidence.                    We conclude, therefore, that

the    trial    court    erred       both        in    regard     to    the   adverse

presumption     ruling    and        the     modified         M   Civ    JI   6.01(c)

instruction.

       Having determined that the trial court erred, we turn

to the issue whether the error was harmless.8                          Instructional



       could have been produced by [him / her], you may
       infer that the evidence would have been adverse
       to the [plaintiff / defendant], if you believe
       that no reasonable excuse for [plaintiff’s /
       defendant’s] failure to produce the evidence has
       been shown.)
       8
        As an initial matter, before a “harmless error”
inquiry is performed by the reviewing court, the party
challenging the instruction must preserve the issue for
appeal.   MCR 2.516(C).   To preserve the issue, the party
must timely object to the instruction on the record,
“stating specifically the matter to which the party objects
and the grounds for the objection.” Id.

                                           10

error is harmless unless a failure by the reviewing court

to   correct        the    error    would    be     “inconsistent    with

substantial justice.”          MCR 2.613(A).         The error in this

case was harmless with regard to the FELA and FLIA claims

because the jury returned a verdict of no cause of action

in favor of defendant.             We do not disturb this aspect of

the judgment.        Id.    The error was not harmless, however,

with regard to the jury’s finding that the handbrake was

“inefficient” and that defendant violated the FSAA.

     During     trial,       plaintiff’s     counsel     made     repeated

references     to    the   erroneous    adverse     presumption   ruling.

Counsel   for   plaintiff      told    the   jury    during   voir   dire,

opening arguments, and closing arguments that the handbrake



     At oral argument, counsel for plaintiff stipulated the
timeliness of defendant’s objection.    Plaintiff’s counsel
only challenged the specificity of the objection.         At
trial, defense counsel objected to the instruction given by
the trial court by stating, “The defendant objects to the
presumption   instruction   or   the   revised   presumption
instruction that was given today.    We object to the fact
that the requested instruction by the defendant regarding
inference that the prior and post condition of the brake
should have been considered.”

     While we acknowledge that defense counsel’s objection
is not a model of clarity, we conclude that defense counsel
satisfied the specificity requirements of MCR 2.516(C).
Counsel stated specifically the matter to which defendant
objected (i.e., the revised presumption instruction given
by the trial court) and the grounds for the objection
(i.e., that the trial court did not give the full inference
instruction requested by defendant).    Accordingly, defense
counsel preserved the issue for appeal.

                                      11

could    be    “presumed          defective.”               The    trial       court    itself

reminded       the       jury    of        the    adverse         presumption        when     it

instructed         the        jury     before          deliberations.            The     trial

court’s erroneous ruling on the adverse presumption and the

numerous references by plaintiff’s counsel to the ruling

during       trial        fundamentally                prejudiced      defendant             with

respect       to        the     FSAA       claim        because      it     significantly

interfered with the jury’s ability to "'decide the case

intelligently, fairly, and impartially.'” Cox, supra at 15

(quoting Johnson, supra at 327).                             Accordingly, failure to

vacate this aspect of the judgment and to grant defendant a

new trial on the FSAA claim would be “inconsistent with

substantial justice.”                 MCR 2.613(A).

        We are not persuaded by plaintiff’s argument that the

trial court cured its erroneous adverse presumption ruling

when    it    later       read       the    jury       a    modified      version      of    the

adverse       inference          instruction               contained      in     M     Civ     JI

6.01(c).           To    the    contrary,          the      trial    court’s         truncated

version       of    M    Civ     JI    6.01(c)          only     compounded      its     prior

error.        The modified version of M Civ JI 6.01(c) omitted

the critical language informing the jury that no adverse

interference arises if the jury believes that a reasonable

excuse       for    defendant’s            failure          to    produce      the     missing

evidence has been shown.


                                                 12

        At     trial,     defendant          presented         evidence     that     its

maintenance        supervisor,             unaware    of       plaintiff’s      earlier

injury report, discarded the handbrake assembly during the

normal course of business.                   Specifically, defendant offered

evidence       that     its     maintenance          supervisor        discarded     the

handbrake       assembly        in    response       to    a    separate     complaint

about the handbrake’s release lever—a lever different from

the application lever, which plaintiff theorized caused his

injury.          Accordingly,              because     defendant        presented      a

reasonable excuse for its failure to produce the handbrake

at   trial,      we     conclude       that    defendant         was   fundamentally

prejudiced by the trial court’s modified version of M Civ

JI 6.01(c).           Defendant was entitled to have the jury hear

the entire version of M Civ JI 6.01(c), not an abbreviated

version        that     created        an     artificial         and      overwhelming

advantage in favor of plaintiff.                      To hold otherwise would

deny defendant a fair trial and would be “inconsistent with

substantial justice.”                MCR 2.613(A); see also Cox, supra at

15 (holding that the failure to reverse on the basis of the

trial        court’s    modified           version    of       SJI2d   30.01,      which

effectively           altered        the     burden       of     proof,     would     be

inconsistent with substantial justice).




                                             13

                              IV.     CONCLUSION

       Accordingly,   we    reverse       the    part   of    the   Court   of

Appeals judgment concerning the FSAA claim and remand this

case to the trial court for a new trial on plaintiff’s FSAA

claim before a properly instructed jury.                     On remand, the

trial court shall instruct the jury that it may infer that

the evidence would be unfavorable to defendant, but that no

such   inference   should    arise        if    the   jury   believes   that

defendant has a reasonable explanation for its failure to

produce the missing evidence.         M Civ JI 6.01(c).

                                      Clifford W. Taylor
                                      Elizabeth A. Weaver
                                      Maura D. Corrigan
                                      Robert P. Young, Jr.
                                      Stephen J. Markman




                                    14

                 S T A T E     O F   M I C H I G A N 


                             SUPREME COURT 



WILLIAM FRANK WARD,

      Plaintiff-Appellee,

v                                                          No. 124533

CONSOLIDATED RAIL CORPORATION,
d/b/a CONRAIL,

     Defendant-Appellant.
_______________________________

CAVANAGH, J. (dissenting).

      While I tend to agree that the trial court initially

erred under existing law when it concluded that plaintiff

was   entitled   to   an   adverse    presumption,1    I   am   not   as

convinced as the majority that the trial court ultimately

erred when it instructed the jury that it could infer that

the   missing    evidence      was   unfavorable      to   defendant.2

Moreover, even assuming that the trial court erroneously



      1
       See Trupiano v Cully, 349 Mich 568, 570; 84 NW2d 747
(1957).
      2
       See, e.g., In re Wood Estate, 374 Mich 278, 288-290;
132 NW2d 35 (1965). See also Widmayer v Leonard, 422 Mich
280, 289; 373 NW2d 538 (1985); Brandt v C F Smith & Co, 242
Mich 217, 222; 218 NW 803 (1928); Dowagiac Mfg Co v
Schneider, 181 Mich 538, 541; 148 NW 173 (1914); Vergin v
City of Saginaw, 125 Mich 499, 503; 84 NW 1075 (1901);
Cooley v Foltz, 85 Mich 47, 49; 48 NW 176 (1891); Cole v
Lake Shore & M S R Co, 81 Mich 156, 161-162; 45 NW 983
(1890).
instructed the jury, I would conclude that the error was

harmless.

      Here, the jury found that defendant was not negligent

under the Federal Employers’ Liability Act (FELA), 45 USC

51 et seq.            The jury also concluded that the handbrake in

question        was    in    proper     condition     and   safe    to    operate

without unnecessary danger of personal injury as required

by the Federal Locomotive Inspection Act (FLIA).                           See 49

USC 20701(1).            However, the jury found that the Federal

Safety          Appliance        Act    (FSAA),     specifically          49   USC

20302(a)(1)(B), had been violated because the handbrake was

inefficient.           On the facts before us, I fail to see how the

perceived        error      in   this     case   resulted   in     such    unfair

prejudice to defendant that permitting the jury’s verdict

to stand would be inconsistent with substantial justice.

In my view, the jury could have reached its verdict without

the       aid     of     the      trial     court’s     arguably         erroneous

instruction.           The jury could have concluded that defendant

was not negligent and that the handbrake, even though not

unnecessarily           dangerous,        was    nonetheless       inefficient.3

Accordingly, I must respectfully dissent.

                                            Michael F. Cavanagh
                                            Marilyn Kelly


      3
       See, e.g., MCR 2.613(A); Urben v Pub Bank, 365 Mich
279, 287; 112 NW2d 444 (1961); Macklem v Warren Constr Co,
343 Mich 334; 72 NW2d 60 (1955).
                              2