LACY HARTER V GRAND AERIE FRATERNAL ORDER OF EAGLES
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STATE OF MICHIGAN
COURT OF APPEALS
LACY HARTER and MIKE McCLELLAND,
individually and in their capacity as co-personal
representatives of the ESTATE OF KEGAN
McCLELLAND,
UNPUBLISHED
April 22, 2004
Plaintiffs-Appellees,
v
No. 244689
Livingston Circuit Court
LC No. 00-017892-NO
GRAND AERIE FRATERNAL ORDER OF
EAGLES,
Defendant-Appellant,
and
HOWELL AERIE #3607 FRATERNAL ORDER
OF EAGLES,
Defendant-Appellee,
and
MICHIGAN STATE AERIE FRATERNAL
ORDER OF EAGLES, INEZ D. BARTON
TRUST, HARRIS SEPTIC CLEANING AND
ALWAYS CLEAN PORTABLE TOILETS, INC.,
DALE HARRIS, D & J GRAVEL CO., INC., and
AMERICAN CONCRETE PRODUCTS, INC.,
Defendants.
Before: Cooper, P.J., and O’Connell and Fort Hood, JJ.
O’CONNELL, J. (concurring in part and dissenting in part)
-1-
Because of the trial court’s and the majority’s antic disposition, the Grand Aerie must pay
plaintiffs $8,362,483.82 without any factual or legal justification for holding it liable for Kegan
McClelland’s death.1 This immense sum serves only as a discovery sanction in a case where the
timely production of the requested documents could not have provided any conceivable
assistance to plaintiffs’ case. This is one of the largest discovery sanctions in the history of
Michigan’s jurisprudence.
Plaintiffs argue that knowledge of the relevant insurance companies would have brought
them into settlement negotiations. The argument fails because all the relevant companies did
eventually arrive to negotiate, and the negotiations did not move forward at all. Plaintiffs argue
that had they known of the excess carrier earlier, the carrier would not have asserted a “lack of
notice” defense. Given the fact that the discovery order was entered more than two years after
the fatal accident, more than one year after suit began, but only three months before the entry of
default, this argument amounts to speculation at best. While I concur that the Grand Aerie’s part
in the negotiation fiasco warrants some sanction, the trial court’s use of default in this case more
closely resembles an improper attempt to force settlement2 than an attempt to remedy prejudice
from plaintiffs’ lack of information.3
1
This is a premises liability case with other peripheral tort theories included in the complaint.
Therefore, the primary question is who owned and controlled the land. Ancillary issues include
the propriety of holding the Grand Aerie vicariously liable for the local chapter’s negligence or
finding it directly responsible for its failure to supervise the local chapter. The majority fails to
address any of these substantive issues. All of them favor the Grand Aerie. Michigan has
always favored resolving cases on the merits. Rogers v JB Hunt Transport, Inc, 466 Mich 645,
654; 649 NW2d 23 (2002).
The Grand Aerie does not have any premises liability, because, like most national
fraternal organizations, it lacks ownership and control of the local chapter’s premises. Kratze v
Order of Oddfellows, 190 Mich App 38, 44-45; 475 NW2d 405 (1991), aff’d in part, rev’d in
part on other grounds 442 Mich 136 (1993), 18-348 Appleman on Insurance Law & Practice
§ 10173; Modern Woodmen of America v Lyons, 76 Ind App 641, 654-655; 128 NE 651 (1920).
It does not have any vicarious liability because it had no control over the local chapter’s
maintenance decisions. Kaminski v Great Camp KOTMM, 146 Mich 16, 18; 109 NW 33 (1906).
Finally, the Grand Aerie had no legal duty to supervise the local chapter’s day-to-day operations,
so it had no direct liability for the child’s death. Colangelo v Tau Kappa Epsilon, 205 Mich App
129, 134-136; 517 NW2d 289 (1994). Interestingly, the trial court judge sat on the Colangelo
panel as a visitor, so a total of three appellate jurists who should be familiar with this binding
precedent have chosen to ignore it.
The cases cited represent a century of different courts in different jurisdictions applying a
uniform legal approach to national fraternal organizations. With such a large award falling out
of the legal blue, one can only wonder at the effect that this case might have on an otherwise
stable area of law and the benevolent organizations it once protected.
2
It bears noting that the court rule regarding settlement conferences that was in force at the time
of the proceedings did not expressly permit the default of an insured party as a sanction for the
failure of its insurance company to appear at a settlement conference.
MCR
2.401(G)(1)(amended effective May 1, 2003). Furthermore, the trial court failed to comply with
(continued…)
-2-
I would reverse but remand for a sanction that approximates the severity of the offense.
/s/ Peter D. O’Connell
(…continued)
the record and discernment requirements outlined in cases interpreting MCR 2.313. Bass v
Combs, 238 Mich App 16, 26; 604 NW2d 727 (1999). Nevertheless, the trial court relied on
MCR 2.313 to default the Grand Aerie. It is interesting to note that the majority stalwartly
reviews this emotionally charged comedy of errors and almost reflexively finds no fault with the
trial court or plaintiffs’ counsel. While I will not deny the Grand Aerie’s missteps, the majority’s
resolution falls well short of even-handed justice.
3
The trial court’s primary justification for entering the default was the difficulty plaintiffs now
face with finding a source of recovery given that the Grand Aerie failed to notify its excess
insurer of the case right away. While the Grand Aerie’s immediate compliance with the order
would not have altered this unfortunate situation, the trial court’s entry of default made certain
that a long road to any possible recovery lies ahead.
-3-
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