Sewell v. Clean Cut Management, Inc

Michigan Supreme Court
Lansing, Michigan 48909
____________________________________________________________________________________________
C hief Justice Justices
Maura D. Cor rigan Michael F. Cavanagh

Opinion
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman

____________________________________________________________________________________________________________________________

FILED JANUARY 30, 2001

CHERYL DENISE SEWELL,

Plaintiff-Appellee,

v No. 116528

CLEAN CUT MANAGEMENT, INC. and

JOHN DOE,

Defendants,

and

JEFFREY CRUSE, Individually and d/b/a

CLEAN CUT MANAGEMENT, INC.,

Defendants-Appellants.

________________________________

PER CURIAM

The plaintiff tenant sued the defendant landlord,

alleging negligence and unlawful eviction. During trial, the

defendant moved for a directed verdict on the ground that a

prior judgment in the district court had resolved the issue

whether the eviction was lawful. The circuit court denied the

motion and later entered judgment in favor of the plaintiff.

The Court of Appeals affirmed. We reverse the judgments of

the circuit court and the Court of Appeals, and remand this

case to the circuit court for further proceedings.

Defendant Jeffrey Cruse owned a house at 17184 Warrington

Drive in Detroit. He rented a flat in the house to plaintiff

C. Denise Sewell for $450 per month.

Ms. Sewell soon fell behind in her rent. She says that

she was withholding rent because of numerous unrepaired

problems in the flat.

In May 1995, Mr. Cruse filed a complaint in the district

court, seeking termination of Ms. Sewell’s tenancy.1 This led

to a consent judgment that entered twelve days later.2 The

judgment required Ms. Sewell to pay $450 by June 2. However,

the judgment further provided:

[Mr. Cruse] agrees to make repairs to side

door, lock on front door, tile in bathroom, repair

bathroom leak, bath ceiling, repair hot water &

electrical; all to be made before money is due on

6/2/95.[3]

Mr. Cruse says he made the required repairs. Ms. Sewell

says he did not. However, Mr. Cruse has testified that Ms.

Sewell did sign a form indicating that the repairs had been

made.

1
Summary proceedings for the recovery of possession of

premises are governed by MCL 600.5701 et seq.; MSA 27A.5701 et

seq. and by MCR 4.201.

2
MCR 4.201(K).

3
This language is handwritten on the judgment form and

is not entirely legible. We have added punctuation.

Using this documentation, Mr. Cruse returned to the

district court, where he signed a June 5 application for a

writ of restitution.4 The form indicated that Mr. Cruse had

complied with the terms of the judgment and that Ms. Sewell

had not met her payment obligation. The court signed the writ

on June 7. The form directed the court officer to “remove

[Ms. Sewell] from the premises described and to restore

peaceful possession to [Mr. Cruse].”

Ms. Sewell did not appeal the consent judgment or the

writ of restitution. Neither did she ask the district court

to set aside the judgment or the writ.

Several weeks later, a district court bailiff effected

the eviction. There is conflicting testimony about whether he

removed all of Ms. Sewell’s possessions from the flat. At a

minimum, he put most of her possessions on the front lawn.

Ms. Sewell, who had been in the hospital, learned of the

eviction a few days later. With family members, she went to

the flat. Apparently while removing additional property from

the premises, she slipped and fell. Ms. Sewell had received

a kidney transplant in 1991 and another in 1995, and her fall

evidently caused serious complications in that regard.

In March 1996, Ms. Sewell sued Mr. Cruse in circuit

court.5 In count I of the complaint, she alleged that he had

4
MCR 4.201(L).

The defendants named in the complaint were Clean Cut

Management, Inc.; Mr. Cruse, individually and doing business

negligently maintained the premises and that she had suffered

serious injury as the result. In count II, she alleged that

she had been unlawfully evicted.6

This case was tried before a jury in circuit court.

During trial, Mr. Cruse moved for a directed verdict. He

argued that the district court eviction order was a binding

resolution of the question whether the eviction had been

legal. The court denied the motion.

In its verdict, the jury found that Mr. Cruse had been

negligent,7 and that his negligence had been the proximate

cause of $4,700 in lost wages for Ms. Sewell, as well as

$50,000 in noneconomic damages. The jury also found that she

had been unlawfully ejected from her premises and that her

property loss was in the amount of $5,000. Thus the total

verdict was $59,700.

as Clean Cut Management; and John Doe. The complaint was

answered by Mr. Cruse, doing business as Clean Cut Management,

and he has been the only defendant to participate in this

litigation. Thus we will continue to refer to him as the sole

defendant.

6
Ms. Sewell also asked for treble damages under MCL

600.2918(1); MSA 27A.2918(1), which provides:

Any person who is ejected or put out of any

lands or tenements in a forcible and unlawful

manner, or being out is afterwards held or kept

out, by force, if he prevails, is entitled to

recover 3 times the amount of his actual damages or

$200.00, whichever is greater, in addition to

recovering possession.

7
The jury found no negligence on the part of Ms. Sewell.

Mr. Cruse moved for judgment notwithstanding the verdict

or, alternatively, for new trial. He argued that the district

court proceedings that granted him possession of the

Warrington premises were res judicata and collateral estoppel.

He also argued that, in light of the district court judgment

and writ, Ms. Sewell had been a trespasser at the time she

slipped and fell. The circuit court denied the motion.

The Court of Appeals affirmed,8 citing our decision in

JAM Corp v AARO Disposal, Inc, 461 Mich 161; 600 NW2d 617

(1999).

Mr. Cruse has now applied to this Court for leave to

appeal.

The procedural history in JAM Corp was complicated by

uncertainty regarding the proper names and identities of the

parties. However, there came a point when JAM9 began summary

proceedings in district court to regain control of premises

that had been leased to AARO Disposal, Inc. Because of

problems relating to the corporate status (or lack thereof) of

JAM, the district court action was dismissed with prejudice

(though the premises were returned to the control of JAM).

461 Mich 162-165.

Unpublished opinion per curiam, issued December 3,

1999, reh den February 25, 2000 (Docket No. 208148).

9
There were several variants of the “JAM” corporate name

but, for present purposes, they are not important.

Following the dismissal in district court, JAM filed suit

against AARO in circuit court.10 The complaint stated six

causes of action, including implied contract and unjust

enrichment. The circuit court dismissed the complaint with

prejudice, finding the district court dismissal to be res

judicata. The Court of Appeals affirmed.11 461 Mich 165-166.

In JAM Corp, this Court examined several sections of the

chapter dealing with summary proceedings. Our conclusion was

that “[p]lainly the Legislature took these cases outside the

realm of the normal rules concerning merger and bar in order

that attorneys would not be obliged to fasten all other

pending claims to the swiftly moving summary proceedings.”

461 Mich 168-169. We also said that “it is evident that

judgment in these summary proceedings, no matter who prevails,

does not bar other claims for relief.” 461 Mich 170.

Accordingly, we reversed the judgments of the Court of

Appeals and circuit court in JAM Corp, and remanded the case

for further proceedings on JAM’s circuit court suit. 461 Mich

171.

III

In the present case, the Court of Appeals fastened on our

statement that judgment in summary proceedings does not bar

10
JAM also appealed the district court dismissal, though

the result of that appeal was unknown to us as we wrote our

opinion in JAM Corp. 461 Mich 165.

11
Unpublished opinion per curiam, issued January 16,

1998, reh den April 21, 1998 (Docket No. 193594).

other claims for relief. Quoting that holding, it affirmed a

circuit court judgment based on a jury’s verdict that the

eviction had been illegal, notwithstanding that the eviction

occurred pursuant to an unappealed district court consent

judgment and writ of restitution.

This is not consistent with the statute or with our

analysis in JAM Corp. We said in JAM Corp that “judgment in

these summary proceedings, no matter who prevails, does not

bar other claims for relief.” 461 Mich 170. Nothing in the

statute or in JAM Corp stands for the proposition that, having

litigated in the district court the issue who has the right to

the premises, that question can be relitigated de novo in a

subsequent suit. Such an approach would empty MCL 600.5701 et

seq.; MSA 27A.5701 et seq. of all significance. After

repossessing premises in accord with the statute and an order

of the district court, a landlord would remain in jeopardy of

further litigation on that same question.

Neither do principles of res judicata support judgment of

the Court of Appeals. In Dart v Dart, 460 Mich 573, 586; 597

NW2d 82 (1999), we explained:

Res judicata bars a subsequent action between

the same parties when the evidence or essential

facts are identical. Eaton Co Bd of Co Rd Comm'rs

v Schultz, 205 Mich App 371, 375; 521 NW2d 847

(1994). A second action is barred when (1) the

first action was decided on the merits, (2) the

matter contested in the second action was or could

have been resolved in the first, and (3) both

actions involve the same parties or their privies.

Id. at 375-376.

Michigan courts have broadly applied the

doctrine of res judicata. They have barred, not

only claims already litigated, but every claim

arising from the same transaction that the parties,

exercising reasonable diligence, could have raised

but did not. Gose v Monroe Auto Equipment Co, 409

Mich 147, 160-163; 294 NW2d 165 (1980); Sprague v

Buhagiar, 213 Mich App 310, 313; 539 NW2d 587

(1995).

This case obviously presents issues concerning the

relationship between summary possession proceedings and the

doctrine of res judicata. As explained in Dart, Michigan’s

broad res judicata rule bars claims arising out of the same

transaction that could have been litigated in a prior

proceeding, but were not. JAM Corp, 461 Mich 167.

Our decision in JAM Corp recognized a statutory exception

to this rule with respect to claims that “could have been”

litigated in a prior proceeding. See id. at 168, citing MCL

600.5750; MSA 27A.5750. There, we recognized that the

legislative intent for this exception was to remove the

incentive for attorneys to “fasten all other pending claims to

swiftly moving summary proceedings.” Id. at 169. Our

decision in JAM Corp said nothing about the preclusive effect

of claims actually litigated in the summary proceedings.

Thus, the “other claims of relief,” described in JAM Corp at

170, were those claims that “could have been” brought during

the summary proceedings, but were not. This Court was not

describing subsequent claims involving the issues actually

litigated in the summary proceedings.

In the present case, Ms. Sewell sought damages for

personal injuries suffered on Mr. Cruse’s premises and for

damage to personal property. Mr. Cruse says she was a

trespasser and that the circuit court should have granted a

directed verdict in his favor. We need not decide in this

opinion the full effect of the district court’s judgment and

writ, with respect to the status of Ms. Sewell as she entered

the premises or the extent, if any, of Mr. Cruse’s duty toward

her. However, we do hold that, where the district court

judgment and writ have not been reversed or vacated, they are

conclusive on the narrow issue whether the eviction was

proper.

Unlike JAM Corp, this case presents a question regarding

the preclusive effect of a claim that was actually litigated

in the summary proceeding. Therefore, the limited statutory

exception to Michigan’s res judicata rule does not apply. The

circuit court thus erred in failing to grant, at least in

part, the motion for a directed verdict.

For these reasons we reverse the judgments of the circuit

court and the Court of Appeals. We remand this case to the

circuit court. On remand, the circuit court shall enter

judgment in favor of the defendant on the plaintiff’s wrongful

eviction claim. Because the verdict in favor of the plaintiff

on her negligence claim may have been influenced by the error

with regard to her wrongful eviction claim, we remand for

further proceedings consistent with this opinion with regard

to the negligence claim. MCR 7.302(F)(1).

CORRIGAN , C.J., and WEAVER , TAYLOR , YOUNG , and MARKMAN , JJ.,

concurred.

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

SUPREME COURT

CHERYL DENISE SEWELL,

Plaintiff-Appellee,

v No. 116528

CLEAN CUT MANAGEMENT, INC. and

JOHN DOE,

Defendants,

and

JEFFREY CRUSE, Individually and d/b/a

CLEAN CUT MANAGEMENT, INC.,

Defendants-Appellants.

________________________________

CAVANAGH, J.

I would not decide this case by a per curiam opinion.

Because this case offers the opportunity to address a

jurisprudentially significant issue, I would grant leave so we

might avail ourselves of full briefing and argument by the

parties.

KELLY , J., concurred with CAVANAGH , J.