McMaster v. DTE Energy Co.

509 Mich. 423

984 N.W.2d 91

Dean MCMASTER, Plaintiff-Appellant,

v. DTE ENERGY COMPANY and Ferrous Processing and Trading Company, doing business as Ferrous Processing & Trading Co., Defendants,andDTE Electric Company, Defendant-Appellee.

Docket No. 162076

Calendar No. 2

Supreme Court of Michigan.

Argued January 12, 2022

Decided July 1, 2022

Fieger, Fieger, Kenney & Harrington PC (by Geoffrey N. Fieger, Southfield and Robert Kamenec ) for Dean McMaster.

Cummings McClorey Davis & Acho, PLC, Livonia (by Joel B. Ashton ) and Jacobs and Diemer, PC (by Timothy A. Diemer, Detroit) for DTE Electric Company.

BEFORE THE ENTIRE BENCH

Cavanagh, J.

This case concerns the duties of shippers, common carriers, and drivers in the trucking industry. The issue presented is whether and when shippers may be held liable for damage to persons and property. The Court of Appeals determined that the common-law duty of a shipper was abrogated by Michigan's passage of MCL 480.11a, which adopted the federal motor carrier safety regulations as part of the Motor Carrier Safety Act (the MCSA), MCL 480.11 et seq. We disagree and hold that the common-law duty of care owed by a shipper to a driver was not abrogated by MCL 480.11a. As an issue of first impression, we adopt the "shipper's exception" or " Savage rule"¹ to guide negligence questions involving participants in the trucking industry, as this rule is consistent with our laws—including Michigan's comparative-fault paradigm. A shipper responsible for loading cargo may be held liable for injury to persons or property only for hidden defects—those not readily observable by the carrier or its agents. See United States v. Savage Truck Line, Inc. , 209 F.2d 442, 445 (C.A.4, 1953). Finally, we apply this rule and affirm, on alternate grounds, the grant of summary disposition to DTE Electric Company (DTE) because there exists no genuine issue of material fact that DTE did not breach its duty to plaintiff.

I. FACTS AND PROCEDURAL HISTORY

This is a negligence action seeking compensation for injuries caused when a metal pipe fell out of a scrap container, striking plaintiff, Dean McMaster, in the leg. Defendant DTE, the shipper, contracted with Ferrous Processing and Trading Company (Ferrous) to sell scrap metal generated by its business. As part of the deal, Ferrous placed its large metal roll-off containers at various DTE facilities, and DTE filled the containers with pieces of scrap metal. Ferrous, in turn, subcontracted with P&T Leasing Company (P&T), the carrier, to transport the containers, or boxes, between DTE and Ferrous. McMaster worked as a truck driver for P&T doing just that—picking up containers from DTE and transporting them to a Ferrous scrap yard.

In October 2014, McMaster arrived at DTE's Belle River Power Plant to drop off an empty container and pick up one that had been loaded by DTE. McMaster inspected the container and saw a large blue steel pipe, approximately the length of the box's width, lying parallel to and up against the back door of the container. He observed that the cargo consisted of heavy materials below the top of the box and determined that no tarp was necessary for the trip. McMaster then used his trailer's hydraulic system to lift the roll-off container onto the trailer, secured the container to the trailer, and headed to Ferrous's Pontiac facility.

At the Ferrous scrap yard, McMaster had the truck weighed, drove to the inspection area, and then drove to the dumping location as instructed by Ferrous's inspector. He began the typical process of dumping the scrap by getting out of his truck and walking to the back of the trailer that held the container. As was customary, McMaster kept the hydraulics running while he edged open the container door about 12 inches to ensure that no materials fell out. When nothing fell out, he proceeded to pull the safety chain to fully open the door. McMaster observed that the majority of the load contained I-beams. With the Ferrous inspector and another Ferrous employee, McMaster then stood 8 or more feet behind and in view of the open container to discuss where to dump its contents. After about five minutes, the inspector determined that the scrap should be placed in a different area. McMaster then began to walk toward the front of the truck to turn off the hydraulics, which wouldn't be needed until the container was moved to the new area for dumping. At that point, the pipe fell out of the container, hitting McMaster in the back of his left leg and ultimately resulting in a below-the-knee amputation.

In June 2015, McMaster sued DTE and Ferrous for negligence, alleging negligent loading and failure to warn of such improper loading. To support his theory, McMaster retained trucking industry expert Larry Baareman, who testified at a discovery deposition that DTE loaded the scrap in a dangerous manner. More specifically, Baareman opined that the orientation of the blue pipe parallel to and up against the container door was hazardous. Further, Baareman testified that the pipe being loaded on top of other material that was concealed underneath was a hidden defect that made the pipe more susceptible to falling off the truck. Baareman concluded that this positioning could have caused the pipe to roll off.

DTE and Ferrous moved for summary disposition under MCR 2.116(C)(10). The trial court granted DTE's motion, stating:

After considering the legal arguments made by counsel and in looking at the evidence in the light most favorable to the plaintiff, the Court concludes that there's no genuine issue of material fact that exists that would allow reasonable minds to differ in concluding that DTE did not breach the duty of reasonable care owed to plaintiff.

Further, the Court concludes that plaintiff has not sustained his burden as to causation and there's no genuine issue of any material fact remaining as to the elements of negligence analysis.

The trial court denied the motion against Ferrous, and the case continued; McMaster ultimately settled with Ferrous, who is not a party to this appeal. McMaster appealed the final order disposing of the case, and the Court of Appeals affirmed. McMaster v. DTE Energy Co. , unpublished per curiam opinion of the Court of Appeals, issued November 8, 2018 (Docket No. 339271), 2018 WL 5850307 ( McMaster I ). The Court of Appeals reasoned that DTE did not have a duty to warn of or protect McMaster from a known danger, relying on the open and obvious danger doctrine. Id. at 3-4. McMaster appealed in this Court. Because the Court of Appeals erroneously applied open-and-obvious principles to an ordinary-negligence case, we peremptorily vacated Part III of the opinion and remanded for "application of the law of ordinary negligence and for consideration of the issues raised by the parties on the question of the defendant's legal duty." McMaster v. DTE Electric Co. , 504 Mich. 967, 967, 933 N.W.2d 42 (2019).

On remand, the Court of Appeals again affirmed the trial court, this time reasoning that Michigan's passage of MCL 480.11a abrogated DTE's common-law duty or, in the alternative, that the shipper's exception or Savage rule² applied to bar McMaster's claim. McMaster v. DTE Energy Co. , unpublished per curiam opinion of the Court of Appeals, issued July 2, 2020 (Docket No. 339271) (McMaster II ), pp. 5-6, 2020 WL 3621286.

McMaster appealed, and our June 2021 order granting leave asked the parties to address "(1) whether the enactment of MCL 480.11a abrogated the appellee's common-law duty of ordinary care with respect to loading cargo for transport by a commercial motor vehicle operated by the appellant; and (2) whether the appellee owed a duty to the appellant under the ‘shipper's exception.’ See United States v. Savage Truck Line, Inc. , 209 F.2d 442, 445 (C.A.4, 1953)." McMaster v DTE Energy Co , 507 Mich. 958, 958, 959 N.W.2d 531 (2021).

II. STANDARD OF REVIEW

A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of a claim. El-Khalil v. Oakwood Healthcare, Inc. , 504 Mich. 152, 160, 934 N.W.2d 665 (2019). The court must consider all evidence submitted by the parties in the light most favorable to the party opposing summary disposition. Id. Only when the record does not leave open an issue upon which reasonable minds might differ may a motion under MCR 2.116(C)(10) be granted. Id. On appeal, the trial court's determination on a motion for summary disposition is reviewed de novo. Id. at 159, 934 N.W.2d 665. So too are issues of statutory interpretation, including whether the common law has been abrogated by statute.

Murphy v. Inman , 509 Mich. 132, 145–47, 983 N.W.2d 354 (2022) (Docket No. 161454).

III. ANALYSIS

To establish a prima facie case of negligence, a plaintiff must prove the existence of a legal duty, the defendant's failure to exercise ordinary care in the performance of that duty, and harm proximately caused by the breach of that duty. Clark v. Dalman , 379 Mich. 251, 260, 150 N.W.2d 755 (1967). Duty and its breach are the focus of our inquiry in this case.

A. COMMON-LAW ABROGATION

Our first question is whether the MCSA supplanted the common-law duty of care owed by a shipper such as DTE to a driver such as McMaster in the loading of cargo for transport. We conclude that it did not.

During its first review of the case, the Court of Appeals determined that McMaster, as an employee of a subcontractor, was owed a duty of reasonable care by DTE. McMaster I , unpub. op. at 3 (describing "the duty ‘imposed by law’ " as " ‘[t]he general duty of a contractor to act so as not to unreasonably endanger the well-being of employees of either subcontractors or inspectors, or anyone else lawfully on the site of the project’ "), quoting Clark , 379 Mich. at 261-262, 150 N.W.2d 755. However, on remand the Court of Appeals determined that the common-law duty of reasonable care had been abrogated by the Legislature's adoption of the MCSA. McMaster II , unpub. op. at 5. McMaster argues that the...