In Champion, the Michigan Supreme Court ruled that under the MCRA an employer could be held liable for the intentional torts of its supervisor for instances of sexual harassment. The Champion Court held that employers were liable “where the supervisor accomplishes [a] rape through the exercise of his supervisory power over the victim.” In the Champion case, a supervisor used his influence and authority over a lower employee to rape her. The Champion court ruled that the forseeability of the action was not relevant to the employer’s liability.

The Hamed Court overruled the Champion decision, which arose under similar circumstances. The Court’s ruling focused on the fact that employers could not be held liable for the intentional torts of its employees (including supervisors) that were not foreseeable to the employer.

The Michigan Supreme Court stated:

The general rule that an employer is not liable for acts of its employee outside the scope of its business, however, does not preclude vicarious liability in every instance.  This Court has consistently recognized that an employer can be held liable for its employee’s conduct if “the employer ‘knew or should have known of [the] employee’s propensities and criminal record’” before that employee committed an intentional tort.  This inquiry involves an analysis of whether an employer had (1) actual or constructive knowledge of prior similar conduct and (2) actual or constructive knowledge of the employee’s propensity to act in accordance with that conduct.

Although, employers are no longer liable for the unforeseeable torts of their employees under the MCRA, employers must still exercise care in hiring employees. The Court noted that employers might still be liable for the intentional torts of its employees (as well as for negligent hiring or negligent supervision) if the torts were foreseeable.

To be eligible for a catering permit, the licensee must be a “specially designated distributor, specially designated merchant, or holder of a public on-premises license,” AND must also be a licensed “food service establishment or retail food establishment.”  For example, the following types of businesses might be eligible for a catering permit: a restaurant, hotel, or banquet facility that caters offsite events; or a grocery store that sells liquor and provides catering.

A catering permit holder may use the permit at multiple events and locations simultaneously, and there is no limit on the number of catering permits issued in a particular city or county.  A permit holder must complete an MLCC server training program before beginning to use the permit.  The catering permit application fee is $70 and the annual permit fee is $100.

This new law was originally part of the Sunday liquor sales law that went into effect late in 2010, but Governor Granholm vetoed the catering permit section from that law.  It was recently reintroduced and quickly became law.

For additional analysis of the new law, see the Michigan House and Senate analysis.

The State of Michigan has recently created an exception to the requirement that a minor must have a work permit from the minor’s school in order to be employed. Effective immediately, a work permit is not required for a minor who is working as an unpaid volunteer for a charitable organization that is recognized as tax exempt under Section 501(c)(3) of the Internal Revenue Code. The law also seems to cover organizations that do not have a 501(c)(3) tax exemption from the IRS, as long as the organization’s “purposes, structure, or activities are exclusively those that are described in Section 501(c)(3).” A copy of the amended law is attached.

The exception does not apply to a non-profit organization that is outside the scope of Section 501(c)(3), such as a Chamber of Commerce, trade association or real estate board. These other organizations would need to get work permits for volunteers who are minors.

This article was written by Mark S. Demorest, Managing Member of Demorest Law Firm.

Laverne and Marilyn Dutkavich (the “Dutkaviches”) “obtained a judgment lien against Steve Pelletier (“Pelletier”) in the amount of $29,183” in 2004.  In 2006, Pelletier purchased a condominium unit and recorded a warranty deed on January 24, 2007.  In July 2007, the “Dutkaviches filed a notice of judgment lien with the register of deeds” on the condominium.  In September 2007, Pelletier conveyed the property to Robert Thomas (“Thomas”).  None of the proceeds from the sale were dispersed to the Dutkaviches, even though the judgment lien had been filed prior to closing. The Dutkaviches recorded a notice of levy on the property after the property had already been transferred to Thomas.  In 2009, Thomas filed suit to quiet title to the property.

The Dutkaviches claimed that “payment in full is a prerequisite to discharging a judgment lien under the” Michigan Judgment Lien Act (“MJLA”).  Because there was no payment here, the Dutkaviches claim that the judgment lien clouded the title, and that Thomas was not a bona fide purchaser for value because Thomas “failed to demand that the lien be discharged with the proceeds from the sale.”

“Thomas contends that MCL 600.2819 requires that the judgment debtor alone to pay the judgment creditors with proceeds from the sale.”  Thomas argued that the purchaser of the property has no duty to satisfy the judgment, regardless of whether or not they had notice of the judgment lien.

The Court of Appeals held that the MJLA did not permit the foreclosure of the judgment lien.  Further, the MJLA did not give Thomas any obligation to make payment to the Dutkaviches, as Pelletier, the judgment creditor was required to make that payment.

The Court of Appeals held that the MJLA did require that the judgment lien remain attached to the property.   The Court reasoned that the Legislature had provided that a partial discharge of a lien would continue as an encumbrance on the property, then certainly a non-payment would continue to remain attached to the property. This may seem unfair to Thomas, but he proceeded with the closing without demanding that the judgment lien be extinguished.

The Court of Appeals also held that MCL 600.6018 may allow the Dutkaviches to claim a levy on the property and force the sale of the property.  MCL 600.6018 provides a separate remedy from the MJLA, which allows the levying against land conveyed in fraud of creditors.  The Court of Appeals remanded the case to the trial court to determine whether MCL 600.6018 would allow the Dutkaviches to make such a claim.

This article was written by Matt Ehrlich from Demorest Law Firm.

http://www.scribd.com/doc/41635481/McGill-v-GCSDA-Pet-11-10

This article was written by Matt Ehrlich, Associate Attorney at Demorest Law Firm.

Below are a few of the key provisions the Act:

• To assert a lien, there must be a written commission agreement entered into after October 5, 2010.

• The broker must actually be entitled to a commission pursuant to the written agreement.

• The individual asserting the lien must be a licensed real estate broker in Michigan.

• The lien must be recorded with the register of deeds before the real estate transaction closes and before the real estate is conveyed.

• The lien must be mailed to the land owner within ten (10) days of recording.

• If there is a commission dispute, escrow accounts are to be established with funds to satisfy the lien until the dispute is resolved.

• The broker has one year to foreclose upon the lien after it is recorded.

Commercial real estate transactions often involve complex legal issues. The recent enactment of the Act further adds to the complications of entering into a commercial real estate transaction.  Parties entering into real estate transactions may wish to consult with an attorney in order to obtain a lien waiver from the real estate agents involved in the transaction before closing.

This article was written by Matt Ehrlich, Associate Attorney at Demorest Law Firm.

Normally the due date to file an individual income tax return for calendar year end taxpayers without an extension is April 15^th.However the date will be April 18^th next year, even though April 15^th falls on a Friday in 2011.

To find out the reasons why you are getting an extra three days you can read Kelley Phillips Erb’s blog from Wallet Pop titled Why Tax Day won’t be April 15 in 2011 or click the following link Why Tax Day won’t be April 15 in 2011.

This article was written by Jay Kossen, CPA at Numerico, PC. Click here to view Numerico’s website.

The Uniform Condemnation Public Act (UCPA) provides that:

if the property owner…successfully challenges the agency’s right to acquire the property….and the court finds the proposed acquisition improper, the court shall order the agency to reimburse the owner for actual reasonable attorney fees and other expenses incurred in defending against the improper acquisition. (Emphasis Added).

Attempting to avoid paying attorney’s fees, Grosse Isle argued that there was nothing to “reimburse” to the Company because the attorney’s fees had not yet been paid.   In rejecting Grosse Isle’s argument, the Court of Appeals reasoned that “the Legislature’s primary purpose in the attorney fee provisions of the UCPA is that property owners ‘not be forced to suffer because of an action that they did not initiate and that endangered through condemnation proceedings, their right to private property.’”  Reading the term “reimburse” to foreclose attorney’s fees that were incurred but not yet paid was contrary to the Legislature’s intent.

The Court of Appeals held, “[c]ontrary to plaintiff’s argument, the words ‘incurred’ and ‘reimburse’…do not require a property owner to have actually paid its attorney before the property owner’s right to recover from the government agency its ‘actual reasonably attorneys fees. The Court rejected the view that attorney’s fees need actually have been paid.”

This decision has broader implications for private individuals.  Although specifically tailored to the UCPA, this decision indicates the willingness of courts to entertain broader readings of the term “reimburse” as applied to other statutes and contracts.  A party may not need to actually make a payment first before seeking “reimbursement.”

This article was written by Matthew Ehrlich, Legal Clerk at Demorest Law Firm.

Courts give “teeth” to the case evaluation process by punishing parties that reject the offered amount and do not do at least 10% better at trial.  If a party rejects the amount and does not do 10% better at trial, then they will have to pay the other sides costs and attorneys fees after the case evaluation. This is called “case evaluation sanctions.”

There is an exception to the requirement to pay case evaluation sanctions. MCR 2.403(O)(11) allows courts to avoid awarding case evaluation sanctions in the “interest of justice.”

In Fowler v. Detroit Symphony Orchestra, Inc., the trial court sought to assist the Detroit Symphony Orchestra (“DSO”) in avoiding the payment of case evaluation sanctions. The Court held in part that there was an interest of justice because the DSO is an indigent entity that provides a public service while being supported by corporations and donations.  Further, the Court held that there was no misconduct on the part of the DSO in deciding not to accept the case evaluation amount.

The Court of Appeals rejected the trial court’s analysis and held that the trial court abused its discretion by declining to award case evaluation sanctions against the DSO.  The Court of Appeals ruled that the DSO’s financial status, public service and DSO’s lack of misconduct were not sufficient factors to avoid case evaluation sanctions.

Instead, the Court of Appeals held that there must be an unusual circumstance to warrant the application of the interest of justice exception. Courts have found unusual circumstances to include: (1) where a legal issue of first impression is presented, (2) where the law is unsettled and substantial damages are at issue, and (3) where the effect on third persons may be significant.  The common thread in the examples listed above is that there was a public interest in having the issue judicially decided rather than merely settled.

This article was written by Matthew Ehrlich, Legal Clerk at Demorest Law Firm.

The decline of the manufacturing economy and the rise of the service economy in the United States have expanded the importance of developing business processes that give businesses a competitive advantage.  A recent opinion by the United States Supreme Court has apparently expanded the scope of patent law to include business processes.  How far patent law will expand in scope is yet to be determined, but for now, businessmen will have greater incentives to create new and efficient processes.

The United States Constitution provides the exclusive right to determine patent disputes to the federal government.  The Federal Patent Act provides in part, “[w]hoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”

In Bilski v. Kappos, the Supreme Court determined that a business process may be patentable.  The key issue in the case was “whether a patent can be issued for a claimed invention designed for the business world.”  Essentially, the case turned on what the term “process” means under patent law.  A process is defined as “process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material.”

The Supreme Court disagreed with the Federal Circuit Court of Appeals decision, which held that the machine or transformation process was the exclusive method for determining the validity of whether a patent was a “process.” The machine or transformation test required that a patent process be: 1) tied to a machine or apparatus or 2) transforms a physical article into a different state or thing or some physical change to an item.

The Supreme Court ruled that the term “process” did not need to be tied to a particular machine.  Although, the patent in this particular case did not warrant the granting of a patent, the Supreme Court opened the door for patent processes that may involve business processes.

This article was written by Matthew Ehrlich, Legal Clerk at Demorest Law Firm.