WHITE v. TAYLOR DISTRIBUTING COMPANY INC (2010)

In this automobile negligence action, plaintiffs appeal as of right from the circuit court's order granting summary disposition to defendants, an individual, his employer, and the owner of the truck the individual was driving when the underlying accident occurred. We reverse and remand. This appeal has been decided without oral argument pursuant to MCR 7.214(E).

On March 15, 2004, plaintiff¹ was stopped in her van when defendant Birkenheuer, driving a tractor-trailer owned by defendant Penske Truck Leasing in the course of his employment with defendant Taylor Distributing Company, collided with the rear of plaintiff's vehicle, allegedly causing serious injury. Birkenheuer maintained that a late-developing medical condition caused him unexpectedly to faint before he was able to stop.

The trial court initially granted defendants summary disposition on the ground that the accident was the result of a sudden emergency, but this Court reversed, White v. Taylor Distributing Company, 275 Mich.App 615, 631; 739 NW2d 132 (2007), and our Supreme Court affirmed, 482 Mich. 136; 753 NW2d 591 (2008).

On remand, defendants argued that a release plaintiff signed upon settling a first-party action with her no-fault insurer, Amex Insurance, relieved defendants of liability in this matter. That release included the following provisions:

IN CONSIDERATION of the payment to the undersigned, ․ [plaintiff] does hereby release and forever discharge AMEX INSURANCE COMPANY, and their officers, employees, principals, shareholders, executors, administrators, agents, successors, insurers and assigns of and from any and all actions, causes of action, claims, demands, damages, costs, loss of services, expenses and/or compensation on account of, or in any way growing out of, any and all known and unknown personal injures and property damage resulting or to result from an accident that occurred on or about March 15, 2004.

IT IS expressly agreed that this Release also refers to any and all (past, present and future) claims/benefits arising or that may arise from the March 15, 2004 accident.

* * *

THIS release contains the ENTIRE AGREEMENT between the parties hereto, and the terms of this release are contractual and not a mere recital․ [Capitals retained, parenthetical omitted.]

In construing this release as precluding plaintiff's recovering from defendants, the trial court stated, “I find that the court's decision is ․ dictated by appellate law by precedent and in this instance I find that the case of Romska [v. Opper, 234 Mich.App 512; 594 NW2d 853 (1999) ], or the cases upon which it[']s based is stare decisis to this case,” but expressed doubts that this ruling reflected plaintiff's actual intent in signing the release.

This Court reviews a trial court's decision on a motion for summary disposition de novo as a question of law. Ardt v. Titan Ins. Co., 233 Mich.App 685, 688; 593 NW2d 215 (1999). Contract interpretation likewise presents a question of law, calling for review de novo. Archambo v. Lawyers Title Ins. Corp., 466 Mich. 402, 408; 646 NW2d 170 (2002). When construing a contract, this Court will read it as a whole and attempt to apply its plain language. Old Kent Bank v. Sobczak, 243 Mich.App 57, 63; 620 NW2d 663 (2000). Accordingly, the various parts of a contract should be read together. See JAM Corp. v. AARO Disposal, Inc., 461 Mich. 161, 170; 600 NW2d 617 (1999); First Baptist Church v. Solner, 341 Mich. 209, 215; 67 NW2d 252 (1954).

Defendants are nonparties to the release, and thus are claiming rights under it as third-party beneficiaries. In Michigan, a third-party beneficiary of a contract “stands in the shoes of the promisee” and thus may enforce the contract against the promisor. Koppers Co. v. Garling & Langlois, 594 F.2d 1094, 1098 (CA 6, 1979), citing MCL 600.1405. However, to create a third-party beneficiary, a contract must expressly promise to act to benefit the third party. Dynamic Constr. Co. v. Barton Malow Co., 214 Mich.App 425, 428; 543 NW2d 31 (1995), citing MCL 600.1405.

The instant release identifies plaintiff's insurer and its agents in great detail, but makes no mention of any other persons, including defendants. The question, then, is whether defendants are members of a class somehow identified within the release. “[T]o qualify as third-party beneficiaries, the language of [a] release[ ] must have demonstrated an undertaking by plaintiff directly for the benefit of [defendants] or for a sufficiently designated class that would include [defendants].” Shay v. Aldrich, --- Mich. ----; --- NW2d ---- (Docket No. 138908, issued August 23, 2010), slip op at 15.

In Romska, the release language interpreted as applying to all potential defendants was “I/we hereby release and discharge [two named individuals] ․ and all other parties, firms, or corporations who are or might be liable, from all claims․” 234 Mich.App at 514 (italics in original).² As plaintiff points out, this language, indicating who is released, is broader than anything found in the instant release. In the latter, the only class described is “AMEX INSURANCE COMPANY, and their officers, employees, principals, shareholders, executors, administrators, agents, successors, insurers and assigns․” The latter description is an attempt to identify the insurer along with those persons or entities who might be subject to liability because of a relationship with that insurer. There is no way to read that description as including defendants.

Defendants persuaded the trial court to interpret the second paragraph of the release as applying to any potential defendant, thus including themselves: “IT IS expressly agreed that this Release also refers to any and all (past, present and future) claims/benefits arising or that may arise from the March 15, 2004 accident.” Defendants argued, and the trial court agreed, that “any and all ․ claims/benefits” meant all such claims in connection with any defendant. We disagree that this language invokes all humanity as released from potential liability, and instead agree with plaintiffs that it in fact underscores the absolute immunity that the specified class is to enjoy.

By interpreting the second paragraph to universally release any potential defendant, the trial court confuses and conflates who is being released, with what is being released. We read the second paragraph's specification of release from “any and all ․ claims/benefits” to comport with the first paragraph's listing of “any and all actions, causes of action, claims, demands, damages, costs, loss of services, expenses and/or compensation on account of, or in any way growing out of, any and all known and unknown personal injures and property damage resulting or to result from an accident ․” by way of supplementing that list of particulars with a general provision intended to ensure that plaintiff would thereafter place no demands whatever on the specified persons or entities.

Comporting with this reasoning is Batshon v. Mar-Que Gen. Contractors, Inc, 463 Mich. 646; 624 NW2d 903 (2001), where our Supreme Court held that broad language describing what was released, “ ‘all consequences of the injuries, losses and damages sustained,’ “ applied to the more narrowly identified persons and entities being released. Id. at 650.

For these reasons, the trial court erred in granting defendants' summary disposition pursuant to MCR 2.116(C)(7) (claim barred by release). We therefore vacate that order and remand this case to the trial court for further proceedings consistent with this opinion.

Reversed and remanded. We do not retain jurisdiction.

I concur in result only.

FOOTNOTES

1.  Because plaintiff Derrick White's interest in this case is derivative of that of plaintiff Sherita White, in this opinion use of the singular “plaintiff” will refer to the latter.

2.  In Shay, --- Mich. at ----, slip op at 1-2, our Supreme Court overruled Romska's prohibition on parole evidence in interpreting the generic “any other persons” language. Accordingly, determinations of what parties are intended to be included by ambiguous “any other persons” language is now determined on a case-by-case basis. However, because the language of the present release unambiguously excluded defendants, Romska as it existed prior to Shay was inapplicable to the instant case and we need not remand for a determination based on parole evidence under Shay.

PER CURIAM.