BRIAN J PERRY V GOLLING CHRYSLER PLYMOUTH JEEP INC
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Michigan Supreme Court
Lansing, Michigan
Opinion
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 APRIL 11, 2007
BRIAN J. PERRY,
Plaintiff-Appellee,
v
No. 129943
GOLLING CHRYSLER PLYMOUTH
JEEP, INC.,
Defendant-Appellant.
BEFORE THE ENTIRE BENCH
TAYLOR, C.J.
In this case, we are called on to determine whether, pursuant to MCL
257.233(9), an application for title to a motor vehicle is “executed” and therefore
the title is transferred to the new owner at the time the application is signed, or if
the application is not “executed” and the title transferred until the application is
sent to the Secretary of State. We hold that “execution” is complete at signing and
thus at that moment title transfers to the new owner, without regard to mailing or
delivery to the Secretary of State. Because the Court of Appeals held to the
contrary on the basis of Goins v Greenfield Jeep Eagle, Inc, 449 Mich 1; 534
NW2d 467 (1995), we reverse its judgment and reinstate the trial court’s grant of
summary disposition for defendant.
The relevant facts in this case are brief. Ksenia Nichols sought to purchase
a vehicle from Golling Chrysler Plymouth Jeep, Inc. In that process, much of the
paperwork had been completed, including the application for title that Nichols had
signed. Hours after taking possession of the vehicle, Nichols collided with a
parked car, causing injury to Brian Perry. Perry sued Golling, asserting that
Golling was still the owner of the vehicle and thus liable under MCL 257.401 for
the acts of its permissive user (Nichols), because, although the application for title
had been signed, the title was not effectively transferred until the application was
delivered to the Secretary of State. In making this argument, Perry relied on
Goins, supra, to assert that the transfer was incomplete until the mailing or
delivery of the application of title to the Secretary of State. Defendant argued that
this was a misinterpretation of Goins and that the transfer was effective upon the
signing of the application for title. Defendant sought summary disposition under
MCR 2.116(C)(10) on the basis of its understanding of when title is transferred,
and the trial court granted defendant’s motion, ruling that at signing the title had
transferred to Nichols and thus Golling was no longer the owner at the time of the
accident.
The Court of Appeals reversed, however, on the basis of its
interpretation of Goins, concluding that a question of fact existed regarding
ownership of the vehicle. Unpublished opinion per curiam, issued October 11,
2005 (Docket No. 254121). Golling sought leave to appeal from the judgment of
2
the Court of Appeals. The Supreme Court directed the clerk to schedule oral
argument on whether to grant the application. 474 Mich 1135 (2006).
STANDARD OF REVIEW
We review de novo an issue of statutory construction, and ascertain the
legislative intent that may reasonably be inferred from the words expressed in the
statute. Quinto v Cross & Peters Co, 451 Mich 358, 362-363; 547 NW2d 314
(1996). Likewise, a trial court’s grant of summary disposition is reviewed de
novo. Chandler v Muskegon Co, 467 Mich 315, 319; 652 NW2d 224 (2002).
ANALYSIS
Under MCL 257.401, the “owner” of a vehicle is liable for injury resulting
from operation of the vehicle, even if the owner is not the driver. An “owner” is
one who holds the title (unless the vehicle is leased).
MCL 257.37.
MCL
257.233(9) explains when title is transferred (emphasis added):
Upon the delivery of a motor vehicle and the transfer, sale, or
assignment of the title or interest in a motor vehicle by a person,
including a dealer, the effective date of the transfer of title or interest
in the vehicle shall be the date of execution of either the application
for title or the assignment of the certificate of title.[1]
1
We note that MCL 257.233 was amended by 2006 PA 317, effective
January 3, 2007. Subsection 9 now provides:
Upon the delivery of a motor vehicle and the transfer, sale, or
assignment of the title or interest in a motor vehicle by a person,
including a dealer, the effective date of the transfer of title or interest
in the vehicle is the date of signature on either the application for
title or the assignment of the certificate of title by the purchaser,
transferee, or assignee.
3
Thus, we must determine in this case what is the date of execution of either the
application for title or the assignment of the certificate of title.
In Goins, supra, the issue was whether the title had been transferred where
the Secretary of State had received the application and issued a certificate of title,
even though the dealer failed to ensure that the buyer had proper insurance, which
should have precluded his being issued a title.2 The Goins Court, in concluding
that the title in that case had been transferred, said, “The application for title was
executed when defendant sent the necessary forms to the Secretary of State, and
the certificate of title was executed when the Secretary of State issued a new
certificate in the purchaser’s name.” Goins, supra at 14. This statement, by itself,
does not clearly say when execution occurred: because of sending and receipt at
the Secretary of State or an earlier point (perhaps at the time of mailing before
receipt or possibly at the moment of signing). This is not a flaw in the opinion
because the only question the Goins Court had to answer, and did answer, was
whether a title application sent to and received by the Secretary of State is one that
has been executed. In fact, the question the present case poses actually builds on
the Goins question and asks: Conceding that execution was surely effected when
the application was sent to the Secretary of State, was the execution effective at
2
MCL 257.233 was slightly different at that time, with title transferring on
“the date of execution of either the application for title or the certificate of title,”
rather than the “assignment of the certificate of title.”
4
some point before that? We believe it was effective even earlier. It was effective
at the moment of signing.
Our caselaw has consistently held that execution requires signing, and that
delivery is separate from execution.3 Other statutes within the Michigan Vehicle
Code likewise indicate that mailing or delivery occurs after execution.4 This is
also consistent with the definition of “execute” found in Black’s Law Dictionary
(6th ed): “To complete; to make; to sign; to perform; to do; to follow out; to carry
out according to its terms; to fulfill the command or purpose of.” This, then, is the
correct understanding of “executed” in MCL 257.233(9), and Goins is entirely
harmonious with this reading of the statute. The dissent’s suggestion that our
holding necessitates overruling Goins reflects a misunderstanding of our holding,
and we reject it.
We conclude that the application for title was executed in this case because
it was signed by the parties. Defendant was not required to send the application to
the Secretary of State in order to complete the execution. We clarify that the
statement in Goins was incorrectly understood by the Court of Appeals to require
3
See, e.g., Farrell v Nutter, 362 Mich 639; 107 NW2d 770 (1961);
Wiedbrauk v Wiedbrauk, 284 Mich 15; 278 NW 747 (1938); Roth v Smilay, 251
Mich 381; 232 NW 220 (1930).
4
For example, MCL 257.238, which requires the person named as the
owner on the certificate of title to add security interests to the title, requires the
owner to first “execute” an application, then “deliver” it to the holder of the
security interest, and then requires that the owner “shall cause the [application] to
be mailed or delivered” to the Secretary of State.
5
delivery as part of the execution. We reverse the Court of Appeals judgment and
reinstate the trial court’s grant of summary disposition for defendant.
Clifford W. Taylor
Elizabeth A. Weaver
Maura D. Corrigan
Robert P. Young, Jr.
Stephen J. Markman
6
STATE OF MICHIGAN
SUPREME COURT
BRIAN J. PERRY,
Plaintiff-Appellee,
v
No. 129943
GOLLING CHRYSLER PLYMOUTH
JEEP, INC., a Michigan corporation,
Defendant-Appellant.
KELLY, J. (dissenting).
I would deny the application for leave to appeal. Although the majority
contends that it merely expands on this Court’s holding in Goins,1 in point of fact,
it distorts and actually rewrites the Goins holding. Also, the critical statement in
Goins that “[t]he application for title was executed when defendant sent the
necessary forms to the Secretary of State,” id., was essential to the determination
of the case and therefore is binding precedent for this case. When the majority
misreads the statement, it effectively overrules Goins. I maintain that Goins
should not be overruled.
1
(1995).
Goins v Greenfield Jeep Eagle, Inc, 449 Mich 1, 14; 534 NW2d 467
THE GOINS DECISION
The issue in Goins was whether an automobile dealership remained the
owner of a vehicle when the dealership failed to send proof of its purchaser’s
insurance coverage to the Secretary of State. Goins v Greenfield Jeep Eagle, Inc,
449 Mich 1, 2; 534 NW2d 467 (1995). In deciding the case, the Michigan
Supreme Court noted that the dealership’s liability turned on whether the
dealership owned the vehicle on the date the vehicle was involved in an accident.
Id. at 4. The Court reiterated the importance to ownership of the transfer of title.
Id. at 13-14. Specifically, it noted that “[t]itle transfers when there has been an
‘execution of either the application for title or the certificate of title.’” Id. at 14,
citing MCL 257.233(5).2 In that regard, the Goins Court made this statement:
The application for title was executed when [the dealership]
sent the necessary forms to the Secretary of State, and the certificate
of title was executed when the Secretary of State issued a new
certificate in the purchaser’s name. [Goins, 449 Mich at 14.]
2
1998 PA 346 redesignated subsection 5 as subsection 9. 1999 PA 206
amended subsection 9 by inserting the term “assignment of the.” When the instant
case accrued, MCL 257.233(9) stated:
Upon the delivery of a motor vehicle and the transfer, sale, or
assignment of the title or interest in a motor vehicle by a person,
including a dealer, the effective date of the transfer of title or interest
in the vehicle shall be the date of the execution of either the
application for title or the assignment of the certificate of title.
2
Therefore, because both events had occurred by the time of the accident, the Court
concluded that title had transferred and the dealership was not the vehicle owner,
hence not liable. Id. at 14.
THE MAJORITY DISTORTS THE HOLDING OF GOINS
The majority contends that its opinion does not necessitate an overruling of
Goins because its opinion is a harmonious extension of the Goins holding. The
irrefutable fact is that the Goins Court wrote that the application for “title was
executed when [the dealership] sent the necessary forms to the Secretary of State.”
Goins, 449 Mich at 14. The majority effectively rewrites this sentence to read,
“the application for title had been executed by the time the dealership sent the
necessary forms to the Secretary of State.” It then adds that the application for
title was executed at the moment the purchaser signed the application for title.
The majority implies that the Goins Court was sloppy in its phraseology.
That seems unlikely given that the Goins Court dedicated a significant portion of
its analysis to past decisions that emphasized the importance of the transfer of title
to the transfer of ownership. See Goins, 449 Mich at 10-14. Considering its
detailed discussion of the importance of deciding when title transferred, it is not
credible that the Goins Court found it unnecessary to specify the exact moment the
title transferred. For that reason, I conclude that the Goins Court meant what it
wrote: the application for title was executed, hence title transferred, “when [the
dealership] sent the necessary forms to the Secretary of State.”
3
THE STATEMENT IN GOINS WAS CENTRAL TO THE HOLDING OF THE CASE
The statement under consideration was not dictum for the reason that it was
essential to the determination of the case.3 As indicated above, the dealership’s
liability in Goins turned on whether it owned the vehicle at the time of the
accident. Goins, 449 Mich at 4. The Goins Court concluded that the dealership
did not own it because both requirements of MCL 257.233(5) had been satisfied.
Id. at 14. In order to make that determination, the Court had to ascertain whether,
at the time of the accident, the application for title had been executed.
Id.
Accordingly, the Court’s statement that the application was executed when the
necessary forms were sent to the Secretary of State was part of the resolution of
the central issue.
The Court of Appeals was correct in relying on Goins to conclude that the
date the dealership mailed the application to the Secretary of State determined
whether the dealership was liable. Perry v Golling Chrysler Plymouth Jeep, Inc¸
unpublished opinion per curiam of the Court of Appeals, issued October 11, 2005
(Docket No. 254121). Moreover, the statement in Goins binds this Court in this
case.
3
“Statements and comments in an opinion concerning some rule of law or
legal proposition not necessarily involved nor essential to determination of the
case in hand are obiter dicta, and lack the force of an adjudication.” Black’s Law
Dictionary (6th ed), defining “dictum.”
4
APPLICATION OF THE ROBINSON FACTORS
Because the majority reads Goins as it does, it denies that it has overruled
that case. As a consequence, it makes no mention of the Robinson4 factors. But
given that the Robinson Court held that precedent should not be overturned
without consideration of these factors, I will apply them now. We should consider
whether Goins was wrongly decided. Robinsion, 462 Mich at 464. We should
also determine whether Goins “defies ‘practical workability,’ whether reliance
interests would work an undue hardship, and whether changes in the law or facts
no longer justify the [Goins] decision.” Id.
My application of the Robinson factors reveals that Goins should not be
overturned. First and most importantly, the Goins Court did not err in holding that
the application for title was executed when the dealership sent it to the Secretary
of State. This conclusion requires an understanding of MCL 257.233. When the
claim in Goins occurred, the Legislature had not defined the term “execute,” as it
appears in the statute. However, the statute does address owners transferring title.
Therefore, it was reasonable for the Goins Court to conclude that the term
“execute” referred to an action that the owner, i.e., the dealership, must take.
Moreover, the Goins Court’s statement that execution occurred when the
dealership sent the necessary forms to the Secretary of State was consistent with
how Michigan courts interpreted the statute at the time. In Zechlin v Bridges
4
Robinson v Detroit, 462 Mich 439; 613 NW2d 307 (2000).
5
Motors Sales,5 which the Goins Court cited, the Court of Appeals observed that
the effective date of a transfer of title is the date of the execution of the application
for title. Id. at 342. In Zechlin, the dealership had filed the application for title
with the Secretary of State before the accident occurred. Id. at 342. Therefore, the
Court of Appeals concluded that the dealership’s ownership interest in the vehicle
terminated before the accident. Id. Accordingly, the Goins Court’s determination
that execution occurred when the dealership sent the necessary forms to the
Secretary of State was consistent with how the Court of Appeals interpreted the
statute at the time.
There is also a public policy basis for the Goins decision. By holding that
the application was executed when the dealership sent the application for title to
the Secretary of State, the Goins Court prevented a possible fraud on buyers.
Were execution interpreted to occur when the buyer signed the application, the
dealership, no longer the owner, could escape liability for a subsequent accident
yet retain the application. It could thereby try to prevent the buyer from obtaining
a certificate of title until the buyer paid it more for the vehicle. The Goins holding
circumvented this problem. For the above reasons, I believe that Goins was
correctly decided.
Additionally, no argument has been made that the Goins decision cannot be
applied in a practical manner. Robinson, 462 Mich at 464. The Goins rule that the
5
190 Mich App 339, 342; 475 NW2d 60 (1991).
6
application for title is considered executed when the dealership sends it to the
Secretary of State is easy to understand and to apply.6
The next Robinson factor to consider is whether, if the decision were
overturned, reliance interests would work an undue hardship. Robinson, 462 Mich
at 464. It is unknown whether or how dealerships and vehicle purchasers altered
their procedures in order to conform to the holding in Goins. Therefore, it is not
possible to ascertain whether there will be any hardship when Goins is overturned.
The final factor to consider is whether changes in the law or facts no longer
justify the decision. Id. From the time Goins was decided until the time the
instant case arose, the relevant portion of MCL 257.233 remained the same.
Specifically, the statute provided that one could ascertain the date of transfer of
title by identifying the date of execution of the application for title. Also, the
record does not reflect that the procedure for obtaining title to a motor vehicle has
changed. Accordingly, no change has occurred in the law or facts. Considering
all the Robinson factors, Goins should not be overturned.
6
See, e.g., Akmakjian v Make a Deal Auto Sales, Inc, unpublished opinion
per curiam of the Court of Appeals, issued August 6, 1996 (Docket No. 181933)
(referring to Goins and deciding that the application for title was executed on the
date that the dealership completed the application for title), and Hartford Accident
& Indemnity Co v The Used Car Factory, Inc, unpublished opinion per curiam of
the Court of Appeals, issued December 9, 1997 (Docket No. 198104) (The court
rejected the dealership’s argument that title transferred when the dealership and
the purchaser signed the application. It also referred to Goins for the proposition
that execution of the application for title does not occur until the dealership sends
the necessary forms to the Secretary of State.).
7
CONCLUSION
The majority has rewritten the holding in Goins. Moreover, the statement
in Goins that execution occurred when the dealership sent the necessary forms to
the Secretary of State was essential to the determination of that case. Therefore, it
is binding precedent. Finally, the Robinson factors do not support overruling
Goins. For these reasons, Goins should remain good law. Its holding governs this
case, as the Court of Appeals recognized. Therefore the Court of Appeals decision
was proper and the application for leave to appeal should be denied.
Marilyn Kelly
Cavanagh, J. I would deny leave to appeal.
Michael F. Cavanagh
8
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