Mich. SC: Noneconomic damages resulting from real property damage can't be recovered

By Jessica M. Karmasek | Mar 25, 2013

LANSING, Mich. (Legal Newsline) -- The Michigan Supreme Court ruled last week that plaintiffs suing over negligent destruction of their property cannot recover noneconomic damages.

In its 26-page opinion Thursday, the court reversed a ruling by the state Court of Appeals.

Plaintiff Beckie Price sued High Pointe Oil Company Inc., claiming -- among other things -- noneconomic damages for the mental anguish, emotional distress and psychological injuries she sustained when the company negligently pumped 400 gallons of fuel oil into her basement.

The incident created an environmental hazard that required the razing of the house.

Before the jury trial, High Pointe moved for summary disposition, in part on the issue of noneconomic damages. It argued that noneconomic damages resulting from real property damage were not compensable.

The court denied that part of High Pointe's motion, concluding that noneconomic damages could be recovered in a negligence action.

The jury awarded Price $100,000 for noneconomic damages, after which High Pointe moved for judgment notwithstanding the verdict and remittitur.

The court denied the motion and High Pointe appealed.

The Court of Appeals affirmed, concluding that a plaintiff may recover mental anguish damages naturally flowing from damage to or the destruction of real property.

The state's high court granted High Pointe's application for leave to appeal.

Justice Stephen Markman, who authored the court's opinion, said Michigan common law has long provided that the appropriate measure of damages in cases involving the negligent destruction of property is the cost of replacement or repair of the property.

Because that rule is "sound," any change in the rule must come by legislative alteration, he said.

"No Michigan case has ever allowed a plaintiff to recover noneconomic damages resulting solely from the negligent destruction of property, either real or personal," Markman wrote. "We are not persuaded of the need for change and therefore continue to adhere to this rule."

The court remanded the case to the trial court for entry of summary disposition in High Pointe's favor.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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