Zsigo v. Hurley Medical Center

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 JUNE 14, 2006

MARIAN T. ZSIGO,

Plaintiff-Appellant,

v No. 126984

HURLEY MEDICAL CENTER,

Defendant-Appellee.

_______________________________

BEFORE THE ENTIRE BENCH

WEAVER, J.

The general rule of respondeat superior is that an employer is not liable for

the torts of its employees who act outside the scope of their employment.1 This

case raises the question whether this Court has adopted an exception to the

respondeat superior rule of employer nonliability found in 1 Restatement Agency,

2d, § 219(2)(d). Under this exception, an employer would be liable for the torts of

an employee acting outside the scope of his or her employment when the

1
Bradley v Stevens, 329 Mich 556, 562; 46 NW2d 382 (1951), citing
Martin v Jones, 302 Mich 355, 358; 4 NW2d 686 (1942).
employee is “aided in accomplishing” the tort “by the existence of the agency

relation.”2 We hold that this Court has not previously adopted this exception, and

we decline to adopt it.

We affirm in part the decision of the Court of Appeals, but for different

reasons, reverse in part, and remand to the trial court for entry of a judgment of

dismissal with prejudice.

FACTS

We adopt the facts as related by the Court of Appeals:

This case arises from plaintiff’s allegation that defendant’s
employee, a nursing assistant, sexually assaulted her in the
emergency room at Hurley Medical Center on July 9, 1998. On that
date, plaintiff was suffering a manic depressive episode when she
was brought to defendant’s emergency department by police and
placed in a treatment room. Because plaintiff was belligerent,
yelling, swearing, and kicking, she was placed in restraints and
administered treatment. Eventually she was left alone in the room
with a nursing assistant assigned to clean the room. Plaintiff begged
him to release her from the restraints.

While the aide was alone in the room with plaintiff, she
continued to make sexually explicit remarks, enticing him to engage
in sexual activity with her. According to plaintiff, she made these
remarks “[a]t first to get him out of the room like the other nurses,”
but when he went to her, she “suddenly thought he was a very
powerful person in the hospital” and “would release [her.]” The aide
engaged, without resistance, in digital and oral sex with plaintiff, but
he did not release her and left. One of the nurses came back into the
room right after the aide left. Plaintiff did not say anything because
she was scared.

Plaintiff reported the incident three days later to a social
worker, police were notified, and an investigation commenced.

2
1 Restatement Agency, 2d, § 219(2)(d).

Plaintiff believed the employee might have been a janitor because he
was cleaning and she provided a general description of the
employee. Through the hospital’s efforts, the nursing assistant was
identified approximately three months later.[3]

Plaintiff brought a complaint against defendant Hurley Medical Center,

alleging assault, battery, and intentional infliction of emotional distress.4 The trial

court denied summary disposition on these counts, finding that there was a

question of fact with regard to whether Powell’s agency relationship with

defendant aided Powell in committing the tortious acts against plaintiff.

At the close of plaintiff’s case, defendant moved for a directed verdict,

asserting that defendant could not be liable for the torts of an employee acting

outside the scope of his employment. Plaintiff, relying on this Court’s opinion in

Champion v Nation Wide Security, Inc,5 argued that defendant was liable under the

“aided by the agency” relationship exception to respondeat superior liability. The

trial court denied defendant’s motion. The jury rendered a verdict for plaintiff in

the amount of $750,000 in past damages and $500,000 in future damages. After

3
Zsigo v Hurley Medical Ctr, unpublished opinion per curiam of the Court
of Appeals, issued May 4, 2004 (Docket No. 240155), slip op at 1-2. Lorenzo
Powell pleaded no contest to a charge of attempted assault with intent to do great
bodily harm less than murder, MCL 750.84. He was sentenced to five years’
probation.
4
Plaintiff had also alleged that defendant was negligent in hiring Powell,
and that defendant had breached its duty of providing safe treatment and
monitoring of a vulnerable patient. Defendant filed a motion for summary
disposition and plaintiff stipulated that the negligence counts be dismissed.
5
450 Mich 702, 712 n 6; 545 NW2d 596 (1996).

reducing the verdict to its present value, the trial court entered a judgment in favor

of plaintiff in the amount of $1,147,247.42.

Defendant appealed, and the Court of Appeals, in an unpublished decision,

reversed and remanded the case for entry of a judgment of dismissal, holding that

the trial court erred in denying defendant’s motions for summary disposition and a

directed verdict because plaintiff failed to present a material question of fact

regarding defendant’s liability under the doctrine of respondeat superior.6 The

Court of Appeals denied plaintiff’s motion for reconsideration. Plaintiff sought

leave to appeal, and we granted the application.7

STANDARD OF REVIEW

This Court reviews de novo a trial court’s decision on a motion for

summary disposition.8 Summary disposition may be granted pursuant to MCR

2.116(C)(10) when “[e]xcept as to the amount of damages, there is no genuine

issue as to any material fact,” and the moving party is entitled to judgment as a

matter of law.9 When reviewing a motion for summary disposition, “a trial court

6
Zsigo v Hurley Medical Ctr, unpublished opinion per curiam of the Court
of Appeals, issued May, 4, 2004 (Docket No. 240155).
7
472 Mich 899 (2005).
8
Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201
(1998).
9
MCR 2.116(C)(10).

considers affidavits, pleadings, depositions, admissions, and other evidence . . . in

the light most favorable to the party opposing the motion.”10

When reviewing a trial court’s decision on a motion for a directed verdict,

the standard of review is de novo and the reviewing court must consider the

evidence in the light most favorable to the nonmoving party.11

ANALYSIS

Under the doctrine of respondeat superior, the general rule is that an

employer is not liable for the torts intentionally or recklessly committed by an

employee when those torts are beyond the scope of the employer’s business.12 1

Restatement Agency, 2d, § 219(2) sets forth the general rule of respondeat

superior and also lists certain exceptions to employer nonliability:

(2) A master is not subject to liability for the torts of his
servants acting outside the scope of their employment, unless:

(a) the master intended the conduct or the consequences, or

(b) the master was negligent or reckless, or

(d) the servant purported to act or to speak on behalf of the
principal and there was reliance upon apparent authority, or he was

10
Maiden v Rozwood, 461 Mich 109, 120; 597 NW2d 817 (1999).
11
Elezovic v Ford Motor Co, 472 Mich 408, 442; 697 NW2d 851
(2005)(Weaver, J., concurring in part and dissenting in part).
12
Bradley, supra at 562.

aided in accomplishing the tort by the existence of the agency
relation.[13]

The question in this case is whether Michigan recognizes the fourth

exception, § 219(2)(d), to the doctrine of respondeat superior nonliability.

Plaintiff argues that Michigan has adopted, or should now adopt, the fourth

exception to the respondeat superior nonliability rule. Section 219(2)(d) provides

an exception to employer nonliability when a plaintiff can show that he or she

relied on the apparent authority of the employee, or that the employee was aided in

harming the plaintiff by the existence of the agency relationship between the

employee and the employer. Section 219(2)(d) and the commentary on that

section establish that this exception to employer nonliability applies primarily to

cases involving misrepresentation and deceit, for example when a store manager is

able to cheat store customers because of his or her position as store manager for

the owner.14

Section 219(2)(d) was first mentioned by this Court in McCann v

Michigan,15 a case in which this Court issued four separate opinions, none of

which received enough concurrences to constitute a majority opinion. A majority

of this Court, however, declined to adopt the exception. Consequently, this Court

did not adopt § 219(2)(d) in McCann.

13
1 Restatement Agency, 2d, § 219(2).
14
Id., § 219 (2)(d), comment on subsection 2.
15
398 Mich 65; 247 NW2d 521 (1976).

Nevertheless, several appellate court decisions have cited the McCann

plurality’s reference to § 219(2)(d) in subsequent tort actions.16 After noting such

multiple references, the Court of Appeals panel below concluded that the

Michigan Supreme Court had adopted § 219(2)(d) in Champion, supra.

In Champion, supra, the plaintiff was raped by her supervisor and sought to

impose liability on their employer for quid pro quo sexual harassment under the

Michigan Civil Rights Act, MCL 37.2103(i). The employer attempted to avoid

liability under the Civil Rights Act on the theory that the employer did not

authorize the supervisor to rape his subordinate. Calling the employer’s

“construction of agency principles . . . far too narrow,” the Court in Champion,

supra at 712, cited Restatement Agency, 2d, § 219(2)(d) in a footnote.17

Champion did not elaborate on this citation in reaching this conclusion.

16
See Zsigo v Hurley, supra, slip op at 3 ( “Our Supreme Court in McCann
v Michigan, 398 Mich 65, 71; 247 NW2d 521 [1976] recited the general principle
and introduced The Restatement of Agency § 219 [2][d]). . . .”); Salinas v Genesys
Health Sys, 263 Mich App 315, 318; 688 NW2d 112 (2004) (“In some
jurisdictions, courts have recognized an exception to that general principle where
the employee ‘was aided in accomplishing the tort by the existence of the agency
relation.’ See 1 Restatement Agency, 2d, § 219[2][d]. . . .”); Elezovic v Ford
Motor Co, 259 Mich App 187, 212; 673 NW2d 776 (2003)(Kelly, J., concurring),
rev’d in part on other grounds Elezovic v Ford Motor Co, 472 Mich 408 (2005)(“
The employer is also liable for the torts of his employee if ‘“the servant purported
to act or to speak on behalf of the principal and there was reliance upon apparent
authority, or he was aided in accomplishing the tort by the existence of the agency
relation,”’” McCann v Michigan, 398 Mich 65, 71; 247 NW2d 521 [1976]. . . .)
(citation omitted).
17
Champion, 450 Mich at 712 n 6.

The reference to “Restatement Agency, 2d, § 219(2)(d)” in footnote six of

Champion may have contributed to appellate court confusion about whether this

Court adopted the aided by the agency exception to employer nonliability under

the doctrine of respondeat superior.18 We now clarify that the reference to §

219(2)(d) in Champion, supra, was made only in passing and on the basis of the

very distinct facts of that civil rights matter.19 We did not, by that reference, adopt

18
While the Zsigo panel of the Court of Appeals held that this Court had
adopted § 219(2)(d) by the reference in footnote 6 of Champion, the Court of
Appeals in Salinas v Genesys Health Sys, 263 Mich App 315, 320; 688 NW2d 112
(2004), held otherwise:

Further, we question whether Champion generally “adopted”
the Restatement exception to the usual rule that an employer cannot
be held liable for torts intentionally committed by an employee. The
only mention of the Restatement exception was made in passing in a
footnote. In the course of rejecting the defendant’s “construction of
agency principles [as] far too narrow,” the Court made a “see”
reference to the Restatement exception. [Champion, supra] at 712 n
6. We are unconvinced that this constituted an adoption of the
Restatement exception, especially for cases like the present one
involving tort actions not at issue in Champion.
19
The dissent contends that the Champion Court implicitly adopted §
219(2)(d) and did not limit its application. We note, to the contrary, that the
Champion holding was carefully crafted to apply only in the context of quid pro
quo sexual harassment under MCL 37.2103(i). Specifically, the Court stated:

In this case, we must decide whether an employer is liable for
quid pro quo sexual harassment under MCL 37.2103(i); MSA
3.548(103)(i) where one of its employed supervisors rapes a
subordinate and thereby causes her constructive discharge. We hold
that an employer is liable for such rapes where they are
accomplished through the use of the supervisor’s managerial powers.
We believe that this result best effectuates the remedial purpose of
(continued…)

§ 219(2)(d). The Court of Appeals erred in finding that this Court affirmatively

adopted the “aided by the agency relationship” exception to liability under the

respondeat superior doctrine set forth in Restatement Agency, 2d, § 219(2).

However, this case again presents us with the opportunity to adopt the exception.

In support of adopting § 219(2)(d), plaintiff cites a First Circuit Court of

Appeals decision, Costos v Coconut Island Corp.20 In Costos, the plaintiff was a

guest at an inn and had retired for the night to her room. The inn manager obtained

a key to the plaintiff’s room, entered without the plaintiff’s knowledge, and raped

her. In finding the employer of the manager vicariously liable under § 219(2)(d),

the court focused on the fact that as an agent of the inn, the manager was entrusted

with the key to the plaintiff’s room and knowledge of where to find her.

Specifically, the key was the “instrumentality” that provided the manager with the

opportunity to accomplish the rape.

(…continued)
the Civil Rights Act, MCL 37.2101 et seq.; MSA 3.548(101) et seq.
[Champion, supra at 704-705 (emphasis added).]

Thus, even in the context of quid pro quo sexual harassment, the sexual
assault must be “accomplished through the use of the supervisor’s managerial
powers.” Id. This limited exception clearly does not apply to the facts in this case.
20
137 F3d 46 (CA 1, 1998).

Costos has been sharply criticized, and appears to have been adopted by

only two other federal courts.21 Indeed, Costos was later distinguished by the

Supreme Judicial Court of Maine in Mahar v StoneWood Transport.22 Maine’s

highest court not only clarified that it had not expressly adopted § 219(2)(d), but

also questioned the application of the exception by the Costos court:

At least one critic notes that the First Circuit’s
“instrumentality” analysis does not delineate the scope of
“instrumentality.” [Casenote: Costos v Coconut Island Corp:
Creating a vicarious liability catchall under the aided-by-agency-
relation theory, 73 U Colo L R 1099, 1112] (“By ignoring the
properly narrow scope of aided-by-agency-relation liability, the
Costos court eroded traditional principles of agency law.”); see
Burlington Indus., Inc. v. Ellerth, 524 U.S. 742, 760, 141 L. Ed. 2d
633, 118 S. Ct. 2257 (1998) (“In a sense, most workplace tortfeasors
are aided in accomplishing their tortious objective by the
employment relation: Proximity and regular contact afford a captive
pool of potential victims.”).[23]

Thus, the dissent’s suggestion that the Costos instrumentality ruling has been

generally accepted, post at 7, is incorrect.

21
LaRoche v Denny’s Inc, 62 F Supp 2d 1366, 1373 ( SD Fla, 1999)(the
defendant restaurant was vicariously liable under § 219[2][d] for racial slur
directed at customers by restaurant manager because manager used his position of
authority as basis for denial of services to customers); Del Amora v Metro Ford
Sales & Service, Inc, 206 F Supp 2d 947, 952 (ND Ill, 2002)(the defendant auto
dealer was liable under § 219[2][d] where the defendant’s employee was able to
obtain the plaintiff’s credit report under false pretenses because of the employee’s
position at the dealership). Cf. Primeaux v United States, 181 F3d 876, 879 (CA 8,
1999)(declining to adopt Restatement exception and noting, “[t]o our knowledge,
the Supreme Court of South Dakota has not had occasion to apply or even cite §
219[2][d] of the Restatement”).
22
823 A2d 540 (2003).
23
Id. at 546 n 6.

Courts have criticized § 219(2)(d) primarily because the exception

swallows the rule and amounts to an imposition of strict liability upon

employers.24 Indeed, it is difficult to conceive of an instance when the exception

would not apply because an employee, by virtue of his or her employment

relationship with the employer is always “aided in accomplishing” the tort.25

Because the exception is not tied to the scope of employment but, rather, to the

existence of the employment relation itself, the exception strays too far from the

rule of respondeat superior employer nonliability.

24
See Gary v Long, 313 US App DC 403, 409; 59 F3d 1391 (1995); Smith
v Metropolitan School Dist Perry Twp, 128 F3d 1014, 1029 (CA 7, 1997).
25
For this reason, the Court of Appeals, in Cawood v Rainbow Rehab Ctr,
269 Mich App 116; 711 NW2d 754 (2005), wisely rejected the application of the
exception in a case involving sexual assault by a nurse of a patient in a
rehabilitation center. The panel succinctly reasoned:

“This Court has held that an employee is not ‘aided in
accomplishing the tort by the existence of the agency relation,’ under
the Restatement exception, just because of the ‘mere fact that an
employee’s employment situation may offer an opportunity for
tortious activity . . . .’” [Salinas v Genesys Health Sys, 263 Mich
App 315, 321; 688 NW2d 112 (2004)] quoting Bozarth v Harper
Creek Bd of Ed, 94 Mich App 351, 355; 288 NW2d 424 (1979).
Rather, the Restatement exception will only apply where “the
agency itself empowers the employee to commit the tortious
conduct.” Salinas, supra at 323. In this case, defendant’s employee
was not empowered to engage in the sexual conduct by the existence
of the agency relationship. He did not use his authority or any
instrumentality entrusted to him in order to facilitate the
inappropriate encounter. Instead, the existence of the employment
relationship merely provided the employee with the opportunity to
engage in the inappropriate conduct. Consequently, the Restatement
exception would not apply. [Cawood, supra at 120-121.]

Because we recognize that were we to adopt the exception we would

potentially be subjecting employers to strict liability, we decline to do so. We

further note that, employers will continue to be subject to liability for their

negligence in hiring, training, and supervising their employees.26 The dissent

contends that these other causes of action available to plaintiffs will not provide

protection to a plaintiff who is injured when an “employer does not have

knowledge that an employee may misuse granted authority.”27 Yet, the dissent

fails to recognize that were this Court to impose liability on an employer under

these very circumstances, we would in fact be subjecting the employer to strict

liability. If the dissent believes that an employer’s prior knowledge of an

employee’s propensity for bad acts is required to impose liability, then the only

basis for employer liability based on an employee’s unknown propensities would

be strict liability.

Given the danger of applying such a broad exception to respondeat superior

employer nonliability because employers may be subject to strict liability, courts

that have applied the exception have done so primarily in sexual

harassment/discrimination cases on the basis that an employer is vicariously liable

26
Plaintiff’s complaint in fact included a count of negligent hiring, a count
that she ultimately stipulated to dismiss after summary disposition motions were
argued before the trial court.
27
Post at 6 n 6.

when a supervisory employee uses his agency position to sexually harass an

employee.28

One court that chose to apply the exception outside the sexual harassment

employment realm was the Vermont Supreme Court when, in Doe v Forrest,29 it

applied § 219(2)(d) in a case where a police officer sexually assaulted a female

28
Veco, Inc v Rosebrock, 970 P2d 906 (Alas, 1999) (Alaska Supreme Court
held vicarious liability may be imposed when an employee is aided in
accomplishing a tort by the employee’s position with the employer, but an
employer’s vicarious liability for punitive damages is limited to acts by
managerial employees while acting within the scope of their employment); Entrot
v BASF Corp, 359 NJ Super 162; 819 A2d 447 (2003) (New Jersey Superior Court
held an employer vicariously liable for a supervisor’s conduct outside the scope of
employment when the supervisor was aided in the commission of the harassment
by the agency relationship); State v Schallock, 189 Ariz 250 , 262; 941 P2d 1275
(1997) (Arizona Supreme Court held “[u]nder the common law of agency, a
supervisor’s use of the actual or apparent authority of his position—power
conferred by the employer—‘gives rise to [the employer’s] liability under a theory
of respondeat superior.’ Nichols [ v Frank, 42 F3d 503, 514 (CA 9, 1994)], citing
RESTATEMENT § 219(2)(d). . ..”) See, also, Burlington Industries, Inc v Ellerth,
524 US 742; 118 S Ct 2257; 141 L Ed 2d 633 (1998), and Faragher v Boca Raton,
524 US 775; 118 S Ct 2275; 141 L Ed 2d 662 (1998).
29
176 Vt 476; 853 A2d 48 (2004). See also Mary M v City of Los Angeles,
54 Cal 3d 202; 814 P2d 1341 (1991)(California Supreme Court held that when a
police officer on duty misuses his official authority by raping a woman whom he
has detained, the public entity that employs him can be held vicariously liable);
Nazareth v Herndon Ambulance Service, Inc, 467 So 2d 1076 (Fla App,
1985)(Florida Court of Appeals acknowledged state’s adoption of Restatement 2d,
§ 219 [2][d] in fraud case); Industrial Ins Co of New Jersey v First Nat Bank of
Miami, 57 So 2d 23 (1952). But, see, Bowman v State, 10 AD3d 315; 781 NYS2d
103 (2004)(New York Supreme Court declined to adopt § 219[2][d] noting that
“‘liability premised on apparent authority [is] usually raised in a business or
contractual dispute context. . . .’”) (citation omitted); Olson v Connerly, 156 Wis
2d 488; 457 NW2d 479 (1990) (Wisconsin Supreme Court declined to apply §
219[2][d] in scope of employment case where it did not appear that employee was
actuated, at least in part, by a purpose to serve the employer).

cashier at a convenience store. The Court held that the sheriff was vicariously

liable because his deputy used his agency position to commit a sexual assault

while on duty.

The dissent asserts, post at 11, that this Court has the option of applying the

exception in the same tailored manner as demonstrated by the Vermont Supreme

Court in Doe v Forrest. Specifically, that court cited Faragher v Boca Raton30 as

the basis for extending § 219(2)(d) beyond the realm of sexual harassment in the

employment setting. According to the dissent, there are three balancing factors

from Faragher that courts can consider when applying § 219(2)(d).31 However,

the dissent ignores the very specific context in which those factors were applied,

namely to a supervisor-employee relationship. The actual language from

Faragher is not broadly worded, but is in fact precisely tailored to the unique

circumstances of a sexual harassment suit in an employment context.

As the dissenting justices in Doe v Forrest noted, the Faragher Court

applied the exception in order to promote the policies of Title VII of the Civil

Rights Act of 1964, 42 USC 2000e et seq. Given the Faragher Court’s limited

30
524 US 742; 118 S Ct 2257; 141 L Ed 2d 662 (1998).
31
The dissent lists them as:

(1) the opportunity created by the relationship, (2) the
powerlessness of the victim to resist the perpetrator and prevent the
unwanted contact, and (3) the opportunity to prevent and guard
against the conduct. [Post at 10, citing Doe, supra at 491.]

application of the exception, the dissenting justices were critical of the majority’s

extension of § 219(2)(d) to factually distinct scenarios:

“T]he majority’s analysis and conclusion are fundamentally
flawed. First, as noted, the high court never intended for its
decisions in Faragher and Ellerth[32]to have any influence on the
development of common-law agency principles or the application of
§ 219 (2)(d) outside the specific context of Title VII.[33]

In concluding that the application of the exception to the facts of that

particular case was too broad, the dissenting justices noted:

[T]he majority has created a threat of vicarious liability that
knows no borders. While the majority limits its holding to sexual
assaults committed by “on-duty law enforcement officers,” ante, at
48, the standard that it articulates applies to a broad range of
employees whose duties grant them unique access to and authority
over others, such as teachers, physicians, nurses, therapists,
probation officers, and correctional officers, to name but a few. As
the trial court here aptly observed, the Court's interpretation could
virtually “eviscerate[] the general scope of employment rule.” [Id. at
505 (Skoglund, J., dissenting, joined by Amestoy, C.J.).]

The Vermont dissenting justices then aptly noted:

Like the finding of a duty of care in negligence law, the
imposition of vicarious liability under agency principles flows not
from the rote application of rules, but from a considered policy
judgment that it is fair and reasonable to hold an employer liable for
the harmful actions of its employee. As Justice Souter, writing for
the United States Supreme Court in Faragher v. City of Boca Raton,
524 U.S. 775, 141 L. Ed. 2d 662, 118 S. Ct. 2275 (1998), cogently
observed: “In the instances in which there is a genuine question
about the employer’s responsibility for harmful conduct he did not in
fact authorize, a holding that the conduct falls within the scope of
employment ultimately expresses a conclusion not of fact but of law.

32
Burlington Industries, Inc v Ellerth, supra.
33
Id. at 509.

. . . The ‘highly indefinite phrase’ [vicarious liability] is ‘devoid of
meaning in itself’ and is ‘obviously no more than a bare formula to
cover the unordered and unauthorized acts of the servant for which it
is found to be expedient to charge the master with liability, as well
as to exclude other acts for which it is not.’” Id. at 796 (quoting W.
Keaton [sic] et al., Prosser and Keaton [sic] on Law of Torts § 502
(5th ed. 1984))[.][34]

We decline to follow the approach suggested by the Vermont Supreme

Court majority in Doe v Forrest. As noted by the dissenting justices in that case,

to do so would expose employers to the “threat of vicarious liability that knows no

borders” for acts committed by employees that are clearly outside the scope of

employment.35 We recognize the danger of adopting an exception that essentially

has no parameters and can be applied too broadly. Because we decline to adopt

the exception, plaintiff has failed to establish that defendant Hurley Medical

Center is vicariously liable for the sexual misconduct of its nursing assistant who

was clearly not acting within the scope of his employment when he engaged in

acts of sexual misconduct with plaintiff.

CONCLUSION

The Court of Appeals below correctly reversed the judgment of the trial

court because plaintiff failed to establish that defendant is liable under the theory

of respondeat superior. We therefore affirm that portion of the May 4, 2005,

34
Id. at 506 (Skoglund, J., dissenting, joined by Amestoy, C.J.).
35
Id. at 504.

opinion of the Court of Appeals and remand the matter to the trial court for entry

of a judgment of dismissal with prejudice.

However, the Court of Appeals erred in concluding that this Court adopted

Restatement Agency, 2d, § 219(2)(d) when we held in Champion, supra, that an

employer was liable for quid pro quo sexual harassment under MCL 37.2103(i).

That part of the judgment of the Court of Appeals is reversed. We decline to

adopt the exception, which would create employer liability for the torts of an

employee acting outside the scope of his or her employment when the employee is

aided in accomplishing the tort by the existence of the agency relationship.

Therefore, plaintiff’s assertion that there is a question of fact regarding whether

defendant’s employee was aided by his agency relationship is moot.

Affirmed in part, reversed in part, and remanded.

Elizabeth A. Weaver
Clifford W. Taylor
Maura D. Corrigan
Stephen J. Markman

STATE OF MICHIGAN

SUPREME COURT

MARIAN T. ZSIGO,

Plaintiff-Appellant,

v No. 126984

HURLEY MEDICAL CENTER,

Defendant-Appellee.
_______________________________

YOUNG, J. (concurring).

I fully concur and join in the majority opinion. I write separately to

question the validity of this Court’s application of agency principles in Champion

v Nation Wide Security, Inc, 450 Mich 702; 545 NW2d 596 (1996). In Champion,

the supervisor engaged in quid pro quo sexual harassment by offering to “take care

of” the plaintiff if she submitted to his sexual requests. However, when the

plaintiff rebuffed his offer, the supervisor raped the plaintiff. This Court held that

an employer is “strictly liable where the supervisor accomplishes the rape through

the exercise of his supervisory power over the victim.” Id. at 713-714. I fail to

see how the supervisor’s “supervisory power” aided him in sexually assaulting the

plaintiff, where he accomplished the sexual assault through brute force after his

attempt to use his supervisory powers had failed. A rape is a physical assault, and

the supervisor in Champion was in no way “aided” by his managerial status in

raping his subordinate.
I find it hard to square Champion with any conventional notion of agency,

and it stands as an isolated, inexplicable exception in our Michigan Supreme Court

jurisprudence.

Robert P. Young, Jr.

STATE OF MICHIGAN

SUPREME COURT

MARIAN T. ZSIGO,

Plaintiff-Appellant,

v No. 126984

HURLEY MEDICAL CENTER,

Defendant-Appellee.
_______________________________

KELLY, J. (dissenting).

We granted leave in this case to address two important questions: (1)

whether this Court has adopted 1 Restatement Agency, 2d, § 219(2)(d) and, if not,

(2) whether we should adopt it now.

Regarding the first question, this Court has not explicitly adopted §

219(2)(d). However, ten years ago in Champion v Nation Wide Security Inc,1 we

did implicitly adopt it. And regarding the second question, we should now

explicitly adopt § 219(2)(d) and apply it to the facts of this case.

Accordingly, I would affirm the Court of Appeals use and recognition of §

219(2)(d) and reverse the trial court’s grant of summary disposition. Summary

disposition was improper because a factual question exists concerning whether the

1
450 Mich 702; 545 NW2d 596 (1996).
person who assaulted plaintiff was aided in committing the tort by his agency

relationship with defendant.

I. THIS COURT HAS IMPLICITLY ADOPTED § 219(2)(D)

As a general rule, an employer is not responsible for an employee’s

intentional or reckless torts that exceed the scope of employment. Bradley v

Stevens, 329 Mich 556, 562; 46 NW2d 382 (1951). But § 219(2)(d) of the

Restatement of Agency provides:

(2) A master is not subject to liability for the torts of his
servants acting outside the scope of their employment, unless:

* * *

(d) the servant purported to act or to speak on behalf of the
principal and there was reliance upon apparent authority, or he was
aided in accomplishing the tort by the existence of the agency
relation. [1 Restatement Agency, 2d, § 219(2)(d).]

The exception essentially holds an employer liable for an employee’s abuse

of the authority that the employer granted.2 Our concern in this case surrounds the

exception’s phrase “aided in accomplishing the tort by the existence of the agency

relation” and whether this Court has previously adopted § 219(2)(d). Id.

2
The majority claims that § 219(2)(d) is primarily applicable in cases of
deceit or misrepresentation. I agree but do not believe that § 219(2)(d) is limited
to those cases. The comments on § 219(2)(d) state that liability may exist where
the servant is able to cause harm because of his or her position as an agent. The
comments also provide that the enumeration of situations where § 219(2)(d)
applies is not exhaustive, and the section applies where an agent causes physical
harm. Therefore, I would not read § 219(2)(d) so narrowly as the majority does.

The majority holds that this Court did not adopt § 219(2)(d) in Champion.

I agree that the magic words “we adopt the Restatement” do not appear. But I

disagree that the Court’s reference to § 219(2)(d) was merely in passing and that

its application of the section was limited to the facts of that case.3 Rather, a close

reading of Champion suggests that the citation of § 219(2)(d) was part of the

Court’s rationale. Also, the citation of § 219(2)(d) was not expressly or implicitly

limited to the facts presented in Champion, and its inclusion was designed to give

guidance to the bench and bar.

Additionally, the citation of § 219(2)(d) was not just a cursory statement.

This Court’s citation of § 219(2)(d) in Champion was in response to one of the

defendant’s arguments in that case. The defendant-employer had asserted that it

could not be responsible for its supervisor’s rape of the plaintiff-employee because

it never authorized the supervisor to rape the employee. Champion, supra at 712.

In direct response, this Court stated, “This construction of agency principles is far

too narrow.” Id. The reader is then directed to § 219(2)(d) to determine how a

court should determine the proper scope of agency principles.

3
The majority also argues that the placement of the citation in a footnote
should determine its precedential effect. This is a dubious argument, considering
that footnotes do sometimes set the state of the law. Perhaps this is unfortunate,
but it is true. See, e.g., United States v Carolene Products Co, 304 US 144, 153 n
4; 58 S Ct 778; 82 L Ed 1234 (1938), which laid the groundwork for heightened
constitutional scrutiny of laws that discriminate on the basis of race and religion.

This Court further stated that, when an employer gives a supervisor certain

authority over other employees, the employer must take responsibility to remedy

any harm caused by the supervisor’s misuse of the authority granted. Id., citing

Henson v City of Dundee, 682 F2d 897, 909 (CA 11, 1982). Champion’s citation

of the Henson decision is especially noteworthy because Henson includes a

discussion of § 219(2)(d):

The common law rules of respondeat superior will not always
be appropriate to suit the broad remedial purposes of Title VII[4] . . .
In this case, however, the imposition of liability upon an employer
for quid pro quo sexual harassment committed by supervisors
appears to be in general agreement with common law principles. See
Restatement (Second) of Agency § 219(2) (d) (master is liable for
tort of his servant if the servant “was aided in accomplishing the tort
by the existence of the agency relation”). [Henson, supra at 910 n
21.]

Given Champion’s direction to readers to refer to the Restatement and

Champion’s citation of Henson, I do not believe that § 219(2)(d) was mentioned

only in passing.5

Nonetheless, the majority seeks, by smoke and mirrors, to hide the fact that

this Court appears to have implicitly adopted § 219(2)(d). Framing the issue as

being whether this Court adopted § 219(2)(d) allows the majority to overrule

4
Title VII is the section of the Civil Rights Act of 1964 that prohibits
employment discrimination. 42 USC 2000e et seq.
5
The majority argues that Champion was carefully crafted to apply only to
quid pro quo sexual harassment cases. Ante at 8-9. I disagree. Champion was a
sexual harassment case. But this Court’s broad statement there that Michigan’s
agency principles are in line with § 219(2)(d) cannot fairly be read as an
expression to limit § 219(2)(d) to sexual harassment cases.

Champion without the need to show that it was wrongly decided. Moreover,

Champion’s validity was not questioned below. But even if this Court has not

already adopted § 219(2)(d), we should explicitly adopt it now.

II. THE COURT SHOULD NOW EXPLICITLY ADOPT § 219(2)(D)

Section 219(2)(d) correctly places responsibility on the employer to ensure

that any grant of authority it makes to an employee is proper. The employer has

the ultimate power to decide whom it will hire. The employer is responsible for

determining what authority its employees are allowed. Therefore, it is the

employer who should be responsible when its employees abuse the authority the

employer gave them and the authority granted enables the employees to cause

harm.

But in seeking to shield employers from liability, the majority instead

places the burden of preventing an abuse of authority and the corresponding harm

on people powerless to prevent it. This case presents a perfect example. Plaintiff

was taken to the defendant hospital against her will. She was strapped to a bed.

Defendant’s employee then used his employer-given authority to enter plaintiff’s

room to sexually assault plaintiff. She had no power over who could enter her

hospital room, and she could not prevent the assault. The entity with the power to

protect plaintiff was the hospital. Yet, the majority leaves plaintiff to bear the full

burden for the harm she was powerless to prevent.

However, § 219(2)(d) recognizes that the majority’s approach of placing

the burden on the victim is unworkable. It also recognizes that such an action

would create a situation where an employer has much less reason to monitor its

employees’ use of authority.6 Therefore, this Court should explicitly adopt §

219(2)(d) and apply it to the facts of this case. Moreover, the majority’s reasons

for not adopting § 219(2)(d) are unpersuasive.

The majority’s main reason for not embracing § 219(2)(d) is that the

exception would swallow the rule. According to the majority, this would create

“‘vicarious liability that knows no borders’ for acts committed by employees that

are clearly outside the scope of employment.” Ante at 16 (citation omitted). But

this generic rationale misunderstands the scope of § 219(2)(d). It also avoids

acknowledging that this Court can adopt a narrow interpretation of § 219(2)(d).

Indeed, the majority seems to accept without explanation that § 219(2)(d)

must be broadly construed. This is understandable in light of the majority’s

calculated fear that adoption of § 219(2)(d) will open a Pandora’s box. But this

6
The majority believes that § 219(2)(d) is unnecessary in light of the
existence of other tort remedies. However a review of case law involving
negligent hiring, training, and supervising shows that the majority is incorrect.
Negligence in hiring requires knowledge on the part of the employer that the
employee has criminal tendencies. Hersh v Kentfield Builders, Inc, 385 Mich 410,
412; 189 NW2d 286 (1971). Negligent training is inapplicable here because there
is no allegation that the nurse’s aide was improperly trained. Negligent
supervising, like negligent hiring and retention, requires knowledge on the part of
the employer that special circumstances exist that could establish a duty to protect
third persons. Millross v Plum Hollow Golf Club, 429 Mich 178, 196-197; 413
NW2d 17 (1987). This review of the torts listed by the majority shows that none
adequately covers a situation where the employer does not have knowledge that an
employee may misuse granted authority. Therefore, § 219(2)(d) is needed to
protect victims like plaintiff.

rationale ignores the fact that the employer liability that § 219(2)(d) provides for is

the tortious use of authority by an employee. Liability is not created by the

employer-employee relationship alone. And § 219(2)(d) requires more than mere

opportunity to commit the tort.7 Bozarth v Harper Creek Bd of Ed, 94 Mich App

351, 355; 288 NW2d 424 (1979). Moreover, the majority’s blanket assertion that

adoption of § 219(2)(d) will create “virtual” strict liability ignores the fact that

several other courts have interpreted the exception narrowly.

For example, courts have taken several approaches to interpreting the scope

of § 219(2)(d). One is to adopt the instrumentality rule which is explained in

Costos v Coconut Island Corp, 137 F3d 46 (CA 1, 1998). Another is to adopt a

balancing approach as explained by the Supreme Court of Vermont in Doe v

Forrest, 176 Vt 476; 853 A2d 48 (2004). Both seek to balance the scope of §

219(2)(d) so as not to impose strict liability based solely on the employer-

employee relationship or on the mere opportunity to commit the tort.

With respect to the instrumentality approach, in Costos, supra, the United

States Court of Appeals for the First Circuit interpreted the scope of § 219(2)(d).

In that case, a hotel manager gained access to a guest’s room and raped the guest.

The court found that the owner and corporate manager of the hotel could be held

liable for the rape. Id. at 50. The court reasoned:

7
The majority’s focus is misplaced. The focus is not on the employment
relationship, but on the authority that the employer granted to the employee.

By virtue of his agency relationship with the defendants, as
manager of the inn, [the manager] was entrusted with the keys to the
rooms, including [the victim’s] room, at the Bernard House. Because
he was the manager of the inn, [he] knew exactly where to find [the
victim]. The jury could find that [the manager] had responsibilities
to be at the inn or to have others there late at night. In short, because
he was the defendants' agent, [the manger] knew that [the victim]
was staying at the Bernard House, he was able to find [the victim’s]
room late at night, he had the key to the room and used the key to
unlock the door, slip into bed beside her as she slept, and rape her.
[Id.]

Thus, the instrumentality approach requires that the tort be accomplished

by an instrumentality or through conduct associated with the agency status.

Accordingly, this interpretation in Costos reads § 219(2)(d) narrowly and balances

interests so that employers do not become liable simply because an employer-

employee relationship exists. In other words, the instrumentality approach to §

219(2)(d) does not result in strict liability for employers.

With respect to the second approach, the Supreme Court of Vermont in

Doe, supra, explored the application of § 219(2)(d) to a sexual assault committed

by a police officer while the officer was on duty. In response to the dissent’s

contention that unfathomable strict liability would result, the court explained that

it was “sensitive to the concern expressed by the trial court that plaintiff’s

arguments could lead to a rule that makes a principal liable for all intentional torts

of an agent in all circumstances.” Id. at 491.

In addressing this concern, the Vermont court, id. at 488, turned to the

United States Supreme Court decisions in Burlington Industries, Inc v Ellerth,8

and Faragher v City of Boca Raton,9 two sexual harassment cases brought under

Title VII. In those cases, the United States Supreme Court concerned itself with

the last phrase of § 219(2)(d) and rejected a narrow reading of its language.10 Doe,

supra at 489-490. As such, while observing that it was not strictly bound by those

decisions, the Doe court viewed Ellerth and Faragher as strong persuasive

authority and helpful to the proper application of § 219(2)(d). Doe, supra at 490.

Accordingly, in following the lead of the United States Supreme Court, the

Vermont court in Doe reasoned that it is “important not to adopt too narrow an

interpretation of the last clause of § 219(2)(d), but it is equally important not to

adopt too broad an interpretation.” Id. at 491 (emphasis added). The court also

reasoned that it should give appropriate deference to the policy reasons underlying

the United States Supreme Court’s decisions. It decided to apply those policy

reasons in the context of an intentional sexual tort committed by a police officer

while on duty.

As such, the Vermont court eventually determined that the three

considerations noted in Faragher correctly balanced the scope of § 219(2)(d) and,

8
524 US 742; 118 S Ct 2257; 141 L Ed 2d 633 (1998).
9
524 US 775; 118 S Ct 2275; 141 L Ed 2d 662 (1998).
10
In Faragher, the Court specifically rejected the proffered reading that the
aid-in-accomplishing theory merely refined the apparent authority theory.

thus, adopted them as its own. The considerations are (1) the opportunity created

by the relationship, (2) the powerlessness of the victim to resist the perpetrator and

prevent the unwanted contact, and (3) the opportunity to prevent and guard against

the conduct. Id. at 491.11

11
The majority asserts that the Vermont Supreme Court in Doe incorrectly
relied on these factors from Faragher because Faragher was limited to cases
involving a supervisor-employee relationship. See ante at 14. In support of this
assertion, the majority relies on the Doe dissent. But I find the Doe court’s
response to that dissent persuasive and fitting in this case. The Doe court
observed:

In following the United States Supreme Court decisions, we
reject the dissent’s claim that the Supreme Court “never intended for
its decisions . . . to have any influence on the development of
common-law agency principles or the application of § 219(2)(d)
outside the specific context of Title VII.” . . . The Supreme Court
applied the Restatement of Agency because it found that “Congress
wanted courts to look to agency principles for guidance” in deciding
hostile environment sex discrimination cases under Title VII. . . .
Thus, in [Ellerth, supra at 754], the Court noted that it was relying
on “the general common law of agency.” (Citation omitted). The
Court noted that state court decisions could be “instructive,” but they
often relied upon federal decisions, id. at 755, and found the
Restatement of Agency a useful starting point to find the general
common law. Id. It went through the various sections of the
Restatement (Second) of Agency and finally centered on § 219(2)(d)
as the most useful. It then applied the “aided in the agency relation
principle” of § 219(2)(d) to the situation before it. Id. at 760-65. . . .
The analysis in [Faragher, supra at 801-802], is similar, and as
noted in the text, the Court resolved a dispute over the meaning of
the language of § 219(2)(d), holding that the “aided-by-agency-
relation principle” was not merely a refinement of apparent
authority.

It is, of course, the nature of the common law that every
appellate decision represents the development of the common law,
and nothing in the Supreme Court decisions suggests they are not an
(continued…)

According to the Vermont court, when all three factors weigh in favor of

the victim, liability may be imposed on the employer under the exception set forth

in § 219(2)(d). Thus, it is clear that the Vermont court’s approach does not result

in strict liability and also serves to protect those who cannot protect themselves.

I agree with the Vermont court that § 219(2)(d) as interpreted by the United

States Supreme Court in Faragher, supra, reflects the correct balance between

reading § 219(2)(d) too narrowly and reading it too broadly. I would adopt its

approach for Michigan law.12 Again, strict liability does not result from this

application of § 219(2)(d). Only in those cases where (1) the opportunity created

(…continued)
integral part of that process. Indeed, the resolution of the dispute
over the meaning of § 219(2)(d) in Faragher is exactly the kind of
decision that best defines and develops the common law. No
common-law court engaged in this process, and certainly not the
highest court of this country, would expect that a common-law
decision on one set of facts would have no influence on future
decisions applying the same legal principle to a different factual
scenario. [Doe, supra at 490 n 3.]

In any event, the reasons underlying the Faragher Court’s use of these
factors applies with equal force here even though there is not a supervisor-
employee relationship. Therefore, extension of those factors is logical and
appropriate. For example, just like a supervisor (Faragher) and a police office
(Doe), a hospital aide has unique access to a patient who is depending on the aide
for care. The patient is often defenseless. Imposing liability on the hospital may
prevent recurrence of an assault by creating an incentive for vigilance.
Accordingly, I disagree with the majority’s assertion that I am ignoring the
specific context in which Faragher announced and applied the factors noted
above. Rather, the context and underlying policy considerations are largely the
same.
12
I do not reject out of hand the instrumentality approach adopted by the
Costos court, but find the balancing approach in Doe more compelling.

by the relationship, (2) the powerlessness of the victim to resist the perpetrator and

prevent the unwanted contact, and (3) the opportunity to prevent and guard against

the conduct are properly balanced will a defendant be held vicariously liable. Id. at

491.

Still, the majority prefers to ignore or discount the fact that this Court has

the power to adopt an interpretation of § 219(2)(d) that does not cause strict

liability. This Court could adopt an interpretation that encompasses its previous

statement that

when an employer gives its supervisors certain authority over other
employees, it must also accept responsibility to remedy the harm
caused by the supervisors’ unlawful exercise of that authority.
[Champion, supra at 712.]

In my view, the most disturbing aspect of the majority’s refusal to adopt or

apply § 219(2)(d) is that its rationale is based solely on an unproven hypothesis.

The majority reasons that adoption of the Restatement could lead to “virtual” strict

liability for employers. But this is simply an unproven assertion designed to cause

fear. More importantly, the majority does not acknowledge that it can interpret §

219(2)(d) to fairly balance the interests that § 219(2)(d) seeks to protect, just as

other courts have done. Instead, it merely states that it refuses to do so because of

its fear that strict liability would result. The majority is like a farmer holding a can

of red paint saying, “I dare not paint my barn because the barnyard will become

red.”

Unlike the majority, I would carefully adopt and amend the common law to

embrace the reasonable interpretation of § 219(2)(d) expressed in Doe and

Faragher. The truth about § 219(2)(d) is that it functions as good public policy

and as practical law when interpreted properly. In light of the discussion above, I

am unpersuaded by the majority’s rationale that boundless liability will result from

a careful adoption of § 219(2)(d). The majority’s rationale misunderstands the

scope of § 219(2)(d) and fails to acknowledge this Court’s ability to craft a rule

that would properly balance the interests protected under § 219(2)(d). Therefore,

had we not adopted it in the past, we should adopt § 219(2)(d) today, thereby

placing the burden on the party most capable of preventing loss or injury.

Moreover, I would apply that interpretation to this case.

Here, under the approach detailed above, a factual question exists whether

his agency relationship assisted the nurse’s aide in committing the tort. Powell’s

position in defendant’s emergency room gave him the opportunity to sexually

assault a restrained patient. It appears that plaintiff was powerless to prevent the

unwanted contact because she was physically bound and was suffering from a

manic episode. In general, patients are vulnerable and trust hospital staff and their

care. Therefore, I would affirm the result of the decision of the Court of Appeals

and remand this case to the trial court for further proceedings.

III. CONCLUSION

I would find that this Court implicitly adopted § 219(2)(d) in Champion.

And even if we did not adopt § 219(2)(d) before, we should adopt it now. We

should interpret the exception as did the Supreme Court of Vermont in Doe, supra,

and apply it to the facts of this case. Consequently, I dissent from the majority

opinion.

I would affirm in part and reverse in part the decision of the Court of

Appeals, and remand this case to the trial court for further proceedings.

Marilyn Kelly
Michael F. Cavanagh