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STATE OF MICHIGAN COURT OF APPEALS

BECKIE PRICE, Plaintiff-Appellee, v HIGH POINTE OIL COMPANY, INC., Defendant-Appellant.

FOR PUBLICATION August 25, 2011 9:15 a.m. No. 298460 Clinton Circuit Court LC No. 08-010387-NO Advance Sheets Version

Before: BECKERING, P.J., and FORT HOOD and STEPHENS, JJ. BECKERING, P.J. In this negligence action, defendant, High Pointe Oil Company, Inc., appeals as of right following a jury trial in which plaintiff, Beckie Price, was awarded $100,000 in noneconomic damages after defendant filled the basement of her home with nearly 400 gallons of fuel oil. The incident created an environmental hazard that required plaintiff's home to be razed from the site and left her displaced from a permanent home for almost two years. Defendant appeals the trial court's orders denying its motion for summary disposition on the issue of noneconomic damages and it's motion for judgment notwithstanding the verdict (JNOV) and remittitur. We affirm. I. FACTS AND PROCEDURAL HISTORY Plaintiff owned a home located in DeWitt, Michigan. She and her former husband helped to build the house, which was completed in 1975. The house was heated by an oil furnace, and the oil tank was kept in the basement. Beginning in 1995, the tank was serviced by Mooney Oil, which was later purchased by defendant. Plaintiff was on defendant's "keep full" list. In 2006, plaintiff replaced her oil furnace with a propane furnace. She then sold the oil furnace and oil tank to a neighbor, who removed both from plaintiff's basement. Before switching to the propane furnace, plaintiff telephoned defendant and canceled its services. There were no fuel oil deliveries made to plaintiff's house between October 2006 and November 2007. On November 17, 2007, while plaintiff was at work, defendant attempted to deliver fuel oil to her house because her name was inadvertently placed on defendant's "keep full" list. Although the oil furnace and oil tank had been removed from plaintiff's basement, the fill pipe located outside of the house had remained unchanged. Defendant's oil truck driver took the hose from his truck, hooked the hose up to the fill pipe, and pumped fuel oil into plaintiff's basement. After four or five minutes, the driver stopped pumping because he felt it had gone too long and that there might be a problem. The driver then looked into the basement and saw fuel oil on the -1-

floor. He called 911, and emergency crews responded shortly thereafter. In total, the driver pumped 396 gallons of fuel oil into plaintiff's basement. An environmental consulting company assessed the damage. Many of plaintiff's personal items located on the main floor of the home were able to be salvaged; however, most of the items in the basement were too heavily contaminated to be salvaged. Additionally, more porous items, such as mattresses and pillows, could not be salvaged because they had absorbed oil fumes. The items that could be salvaged were placed in storage, and the rest were put in a pole barn on plaintiff's property. Eventually, it was determined that the oil had leaked into the soil and that as a result of the contamination, the entire house had to be demolished. The Department of Environmental Quality notified plaintiff on April 18, 2008, that the excavation and cleanup of the soil had been completed and that no further action was required. From November 17, 2007, to March 1, 2008, plaintiff stayed in the extra bedroom of her parents' house, which was also being used to store a number of large antiques, although she often slept on the couch. Her parents were in Texas for all but one week of the time she lived there. From March 1, 2008, until late September 2009, plaintiff stayed in a duplex. Thereafter, she moved into a new house that she had helped to build. Plaintiff built the new house on the same property as the old one, but the new house had to be built in a different location on the property because the soil was unstable where the site had been excavated. Plaintiff filed suit in August 2008, alleging counts of negligence, gross negligence, negligent infliction of emotional distress, nuisance, trespass, and a private citizen's claim under the Natural Resources and Environmental Protection Act, MCL 324.101 et seq. She requested general and compensatory damages for the economic harm caused by defendant's conduct, as well as noneconomic damages for annoyance, inconvenience, pain, suffering, mental anguish, emotional distress, and psychological injuries caused by the destruction of her house. Plaintiff moved for partial summary disposition under MCR 2.116(C)(9) and (10), requesting that the trial court grant summary disposition on her claims of negligence, negligent infliction of emotional distress, trespass, and nuisance. Plaintiff also argued that under the court rules she was entitled to seek noneconomic damages for emotional distress and mental anguish and exemplary damages. Defendant filed a countermotion for summary disposition under MCR 2.116(C)(8) and (10). In regard to plaintiff's request for noneconomic damages, defendant argued that noneconomic damages resulting from property damage are not compensable. The trial court granted plaintiff summary disposition on her negligence claim and granted defendant summary disposition on plaintiff's claims of gross negligence and negligent infliction of emotional distress. The court denied both parties' motions for summary disposition on the trespass, nuisance, and private citizen's claims. With regard to noneconomic damages, the court stated: [The Court]: Relating to the damages, in essence, by dismissing the claim of negligent infliction of emotional distress, I have deprived the Plaintiff of the opportunity to seek mental anguish damages secondary to property damage, and I think that's the law . . . .

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So, it seems to me that the request for economic losses adequate to put the Plaintiff in the position she would have occupied had the torts not been committed, is, of course, for the jury, and I'm satisfied that she can seek to recover non-economic damages as typically allowed in connection with the claim for negligence. * * * [Defense Counsel]: Just for clarification for me, you are allowing mental anguish damages for the negligence claim resulting to the property damage? The Court: Yes, and that's why I took out, in part, the claim for negligent infliction of emotional distress, because the idea of inflicting emotional distress is that the foreseeable outcome of the actor's conduct would be to cause emotional distress, and I don't think that a negligent defendant has to foreseeably see that as an outcome of their conduct if, in fact, it results naturally and probably from that conduct. The parties agree that during the time plaintiff was displaced from her home, all of her economic losses, including the costs of demolition, excavation, and remediation expenses, were paid by her insurer, defendant, or defendant's insurer. Plaintiff received $175,000 from her insurance company, which represented the fair market value of her house, approximately $10,000 for lost personal property, and $1,000 a month for rent while she lived in the duplex. Plaintiff testified at her deposition that she had not incurred any out-of-pocket costs associated with the incident. In January 2010, the case proceeded to a jury trial on plaintiff's trespass, nuisance, and private citizen's claims, as well as the issue of damages related to her negligence claim. Before presenting any proofs, plaintiff withdrew her claim for economic damages, as well as her trespass and nuisance claims. She requested that the court handle her private citizen's claim posttrial.1 Over defendant's objection, the court ruled that plaintiff was entitled to seek noneconomic damages for mental anguish, fright, shock, denial of social pleasures or enjoyments, and any embarrassment she suffered as a result of defendant's negligence. Plaintiff testified that she felt a great sense of loss over the destruction of her house, which held special memories for her; she was embarrassed to move into her parents' house as an adult; she suffered from sleeplessness and an inability to concentrate because of the stress of the situation; and she took an antidepressant over the course of several months. At the close of proofs, the court instructed the jury, over defendant's objection, that it could award plaintiff "non-economic damages, for things such as mental anguish and fright and shock, and denial of social pleasures and enjoyment in the use of the former home and embarrassment or humiliation" suffered as a result of the property damage negligently caused by defendant. The jury returned a

At trial, defendant moved for a directed verdict on plaintiff's private citizen's claim. The trial court took the matter under advisement and later granted defendant's motion.

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verdict in favor of plaintiff in the amount of $100,000 for past damages and $0 for future damages. The court entered a judgment in plaintiff's favor. Thereafter, defendant filed a motion for a new trial, JNOV, and remittitur, arguing that plaintiff had failed to present sufficient proofs to support the verdict. The court denied the motion. Defendant now appeals as of right the trial court's orders regarding plaintiff's recovery of noneconomic damages. II. STANDARDS OF REVIEW Whether a plaintiff is entitled to seek noneconomic damages for damage to or destruction of real property presents a question of law, which we review de novo. See 2000 Baum Family Trust v Babel, 488 Mich 136, 143; 793 NW2d 633 (2010). Plaintiff moved for partial summary disposition under MCR 2.116(C)(9) and (10), and defendant moved for summary disposition under MCR 2.116(C)(8) and (10). The trial court did not specify which subrules it relied on in deciding the parties' motions. A grant or denial of summary disposition is reviewed de novo to determine if the moving party is entitled to judgment as a matter of law. Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). A motion under MCR 2.116(C)(8) tests the legal sufficiency of a claim by the pleadings alone. [Id.] at 119. The motion should be granted only when the claim is so legally deficient that recovery would be impossible even if all well-pleaded factual allegations were true and viewed in the light most favorable to the nonmoving party. Id. Likewise, a motion under MCR 2.116(C)(9) tests the legal sufficiency of a defense by the pleadings alone. Slater v Ann Arbor Pub Schools Bd of Ed, 250 Mich App 419, 425; 648 NW2d 205 (2002). All well-pleaded factual allegations are accepted as true, and summary disposition is appropriate only "when the defendant's pleadings are so clearly untenable that as a matter of law no factual development could possibly deny the plaintiff's right to recovery." Id. at 425426. A motion under MCR 2.116(C)(10) tests the factual sufficiency of a claim. Maiden, [461 Mich] at 119-120. All admissible evidence submitted by the parties is reviewed in the light most favorable to the nonmoving party and summary disposition is appropriate only when the evidence fails to establish a genuine issue regarding any material fact. Id.; MCR 2.116(G)(6). [USA Cash #1, Inc v City of Saginaw, 285 Mich App 262, 265-266; 776 NW2d 346 (2009).] A trial court's decision on a motion for JNOV is also reviewed de novo. Prime Financial Servs LLC v Vinton, 279 Mich App 245, 255; 761 NW2d 694 (2008). We view the evidence and all legitimate inferences from it in the light most favorable to the nonmoving party to determine whether a question of fact existed. Livonia Bldg Materials Co v Harrison Constr Co, 276 Mich App 514, 517-518; 742 NW2d 140 (2007). If reasonable jurors could have honestly reached different conclusions regarding the evidence, the jury verdict must stand. Genna v Jackson, 286 Mich App 413, 417; 781 NW2d 124 (2009).

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We review for an abuse of discretion a trial court's decision regarding remittitur. Silberstein v Pro-Golf of America, Inc, 278 Mich App 446, 462; 750 NW2d 615 (2008). An abuse of discretion occurs when the result is outside the range of principled outcomes. Heaton v Benton Constr Co, 286 Mich App 528, 538; 780 NW2d 618 (2009). The trial court, having witnessed the testimony and the evidence as well as the jury's reactions, is in the best position to evaluate the credibility of the witnesses and make an informed decision. Unibar Maintenance Servs, Inc v Saigh, 283 Mich App 609, 629-630; 769 NW2d 911 (2009). Therefore, we must give due deference to the trial court's decision. Id. III. NONECONOMIC DAMAGES FOR THE DESTRUCTION OF REAL PROPERTY Defendant argues on appeal that under current Michigan law, plaintiff is not entitled to seek noneconomic damages for mental anguish caused by the destruction of her home. Defendant first raised this argument in response to plaintiff's motion for summary disposition, and the argument presents an issue of first impression in this state. We agree with the trial court that it was legally permissible for plaintiff to seek mental anguish damages in this case. As a general rule, noneconomic damages are recoverable in tort claims, and emotional damages include both emotional distress and mental anguish. See Phillips v Butterball Farms Co, Inc, (After Second Remand) 448 Mich 239, 251 n 32; 531 NW2d 144 (1995); McClain v Univ of Mich Bd of Regents, 256 Mich App 492, 498-500; 665 NW2d 484 (2003). In Sutter v Biggs, 377 Mich 80, 86; 139 NW2d 684 (1965), our Supreme Court explained: The general rule, expressed in terms of damages, and long followed in this State, is that in a tort action, the tort-feasor is liable for all injuries resulting directly from his wrongful act, whether foreseeable or not, provided the damages are the legal and natural consequences of the wrongful act, and are such as, according to common experience and the usual course of events, might reasonably have been anticipated. According to defendant, plaintiff is limited in her recovery to the difference between the market value of her house before and after the damage. Because plaintiff was paid the difference in market value, defendant argues that she has been fully compensated. Defendant relies on Strzelecki v Blaser's Lakeside Indus of Rice Lake, Inc, 133 Mich App 191; 348 NW2d 311 (1984), and Baranowski v Strating, 72 Mich App 548; 250 NW2d 744 (1976) to support its argument. In Strzelecki, this Court stated: "It is the settled law of this state that the measure of damages to real property, if permanently irreparable, is the difference between its market value before and after the damage. However, if the injury is reparable, and the expense of repairs is less than the market value, the measure of damage is the cost of the repairs." [Strzelecki, 133 Mich App at 194 (citation omitted).] In both Strzelecki and Baranowski, however, this Court addressed the measure of damages for economic loss suffered as a result of the destruction of real property. Neither case included a discussion of noneconomic damages. Therefore, defendant's reliance on Strzelecki and Baranowski is misplaced. -5-

Defendant further argues that recovery for emotional distress or mental anguish caused by damage to or the destruction of real property is not permitted under common law. In support of its argument, defendant cites Koester v VCA Animal Hosp, 244 Mich App 173; 624 NW2d 209 (2000), and Bernhardt v Ingham Regional Med Ctr, 249 Mich App 274; 641 NW2d 868 (2002). In Koester, a negligence action, this Court considered whether a dog owner could recover "damages of emotional distress and loss of companionship" of his pet dog, which is considered personal property under Michigan jurisprudence. Koester, 244 Mich App at 176. Declining to permit such recovery, the Court stated: There is no Michigan precedent that permits the recovery of damages for emotional injuries allegedly suffered as a consequence of property damage. Plaintiff requests that we allow such recovery when a pet is the property that is damaged, arguing that pets have evolved in our modern society to a status that is not consistent with their characterization as "chattel." In essence, plaintiff requests that we create for pet owners an independent cause of action for loss of companionship when a pet is negligently injured by a veterinarian. Although this Court is sympathetic to plaintiff's position, we defer to the Legislature to create such a remedy. [Id.] In Bernhardt, the plaintiff's claims arose out of the loss of two pieces of jewelry that were of great sentimental value to her. Bernhardt, 249 Mich App at 276-277. The plaintiff filed suit against the defendant hospital, which she alleged was responsible for the loss, claiming conversion, breach of bailment, and intentional infliction of emotional distress and, in the alternative, negligence and replevin. Id. at 277. This Court held that the plaintiff's "claims of emotional distress in connection with her tort claims of conversion and negligence" were insufficient to bring the "case within the jurisdiction of the circuit court," noting that the plaintiff had not specifically alleged emotional distress damages in connection with her conversion and negligence claims, as well as the Koester Court's statement that "there is no Michigan precedent that permits the recovery of damages for emotional injuries allegedly suffered as a consequence of property damage." Id. at 279 & n 1. Defendant acknowledges that both Koester and Bernhardt involved the loss or destruction of personal property, whereas, this case involves the destruction of real property. Nonetheless, defendant asserts that those holdings should be applied in this case. We disagree. As indicated, the general rule in Michigan is that noneconomic damages are recoverable in tort claims, Phillips, 448 Mich at 251 n 32, and "in a tort action, the tort-feasor is liable for all injuries resulting directly from [the] wrongful act, whether foreseeable or not, provided the damages are the legal and natural consequences of the wrongful act, and . . . might reasonably have been anticipated," Sutter, 377 Mich at 86. While this Court has carved out an exception to that general rule in regard to emotional damages for the loss or destruction of personal property (which is considered to be a replaceable chattel despite any emotional attachment)2, we decline

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Random House Webster's College Dictionary (2001) defines "chattel" as "a movable article of personal property" and "any tangible property other than land and buildings." Merriam-6-

to extend that exception to real property. Defendant has failed to cite any authority requiring such a holding. Furthermore, contrary to defendant's assertion, the law has historically distinguished between personal property and real property. For example, liability for trespass to land does not require any actual showing of damage. "`Any intentional and unprivileged entry on land is a trespass without a showing of damage, since those who own land have an exclusive right to its use[.]'" Adkins v Thomas Solvent Co, 440 Mich 293, 304; 487 NW2d 715 (1992), quoting Prosser & Keeton, Torts (5th ed),

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