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Michigan Supreme Court Lansing, Michigan

Opinion
ARTHUR Y. LISS and BEVERLY LISS, Plaintiffs-Appellees, v

Chief Justice:

Justices:

Clifford W. Taylor

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

FILED JUNE 6, 2007

No. 130064

LEWISTON-RICHARDS, INC., and JASON P. LEWISTON, Defendants-Appellants. _______________________________ BEFORE THE ENTIRE BENCH YOUNG, J. The issue presented in this case is the proper scope of the exemption for regulated conduct and transactions under the Michigan Consumer Protection Act (MCPA).1 The MCPA exempts any "transaction or conduct specifically

authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or the United States."2 In Smith v Globe Life Ins

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MCL 445.901 et seq. MCL 445.904(1)(a).

Co, 3 this Court held that the relevant inquiry "is whether the general transaction is specifically authorized by law, regardless of whether the specific misconduct alleged is prohibited." In Hartman & Eichhorn Bldg Co, Inc v Dailey,4 the Court of Appeals opined that under the Smith test, licensed residential home builders were exempt from the MCPA; however, the Court ruled against the residential home builders because it believed that it was bound by Forton v Laszar5 to hold that the residential home builders were subject to the MCPA. We hold that under MCL 445.904(1)(a), residential home builders are exempt from the MCPA because the general transaction of residential home building, including contracting to perform such transaction, is "specifically authorized" by the Michigan Occupational Code (MOC), MCL 339.101 et seq. Therefore, we overrule any holding to the contrary in Forton and Hartman. FACTS AND PROCEDURAL HISTORY In December 2000, plaintiffs, Arthur and Beverly Liss (Lisses) and defendant Lewiston-Richards, Inc. (Lewiston-Richards), entered into a contract for the sale and completion of construction of a residential home. Defendant Jason Lewiston (Lewiston), President of Lewiston-Richards, executed the contract on Lewiston-Richards's behalf. The Lisses allege that Lewiston-Richards did not

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460 Mich 446, 465; 597 NW2d 28 (1999). 266 Mich App 545; 701 NW2d 749 (2005). 239 Mich App 711; 609 NW2d 850 (2000).

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complete construction on time and that the construction that was completed was not done in a workman-like manner. In 2003, the Lisses filed this action alleging breach of contract, breach of warranty, and other causes of action.6 Pertinent to this appeal, the Lisses allege that defendants violated the MCPA. Through their counterclaim and answer, defendants asserted that the transaction at issue, residential home building, was exempt from the MCPA. The parties filed crossmotions for summary disposition. The trial court denied defendants' motion for summary disposition of the MCPA claim. The court held that it was bound to follow Hartman and hold that defendants were subject to the MCPA. Defendants filed an application in the Court of Appeals for leave to appeal from the order denying their motion and an application in this Court for leave to appeal before a decision by the Court of Appeals. application.7 STANDARD OF REVIEW This Court reviews questions of statutory interpretation de novo.8 When interpreting a statute, this Court attempts to give effect to the Legislature's intent This Court granted defendants' bypass

The Lisses also filed a complaint with the Department of Labor and Economic Growth, Bureau of Commercial Services Enforcement Division. This entity within the Department of Labor and Economic Growth investigates and resolves consumer complaints against residential home builders.
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474 Mich 1133 (2006). City of Taylor v Detroit Edison Co, 475 Mich 109, 115; 715 NW2d 28

(2006).

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by looking at the statutory text, giving meaning to every word, phrase, and clause in the statute and considering both their plain meaning and their context.9 This Court also reviews a trial court's decision granting or denying a motion for summary disposition de novo.10 ANALYSIS Under the MCPA, "[u]nfair, unconscionable, or deceptive methods, acts, or practices in the conduct of trade or commerce are unlawful . . . ."11 However, the Legislature included an exemption in MCPA

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Michigan Law