Michigan Supreme Court recently ruled that Court of Appeals erred by failing to apply the framework of an earlier case since that decision was never clearly superseded by the Legislature or overruled by the Supreme Court. The holding in Baker v. Slack (1948) that damages for lost earning capacity are not available under the Wrongful Death Act (WDA) was reaffirmed.
The issue in Nawal Daher v. Prime Healthcare Servs.-Garden City, LLC was whether the WDA allows recovery of damages for lost future earnings without a showing that a beneficiary is entitled to those earnings as financial support.
The parents of the patient brought a medical malpractice action under the WDA, alleging that the defendants failed to diagnose and treat bacterial meningitis in their 13-year-old son, Jawad, leading to his death. The night before he died, his mother took him to the emergency room at Garden City Hospital, where he was diagnosed with and received care for torticollis before being discharged (a twisting of the neck that causes the head to rotate and tilt at an odd angle). The next morning, the boy was found dead at home. An autopsy revealed the cause of death to be acute purulent (i.e., bacterial) meningitis.
The complaint sought damages for, among other things, their son’s lost future earnings. Their expert estimated that those damages were between $11,000,000 and $19,000,000, depending on the level of education that the boy would have received. The defendants moved for summary disposition, arguing that damages for lost future earnings aren’t allowed under the WDA and that, even if such damages were recoverable, the parents failed to prove any lost future earnings beyond mere speculation. The trial court denied the motion.
The defendants appealed, and the Court of Appeals affirmed. Following Denney v. Kent Co. Rd. Comm. (2016), the majority held that damages for lost earnings are allowed under the WDA. While the majority recognized that the Supreme Court held in Baker that lost future earnings were not recoverable under an earlier version of the WDA, they said that “Baker has clearly been overruled or superseded, and . . . was no longer ‘good law’ long before [the Court of Appeals] decided Denney.”
The defendants then asked the Supreme Court to address whether: (i) the estate of a child may recover damages for the child’s lost future earnings; and (ii) to what specificity future earnings need be shown.
Justice David F. Viviano wrote in his opinion that pursuant to MCL 600.2921, “[a]ll actions and claims survive death.” However, “[a]ctions on claims for injuries which result in death shall not be prosecuted after the death of the injured person except pursuant to [the WDA, MCL 600.2922].” Subsection (6) of the WDA says what damages are permitted by the act. It provides, in relevant part, that
[i]n every action under this section, the court or jury may award damages as the court or jury shall consider fair and equitable, under all the circumstances including reasonable medical, hospital, funeral, and burial expenses for which the estate is liable; reasonable compensation for the pain and suffering, while conscious, undergone by the deceased during the period intervening between the time of the injury and death; and damages for the loss of financial support and the loss of the society and companionship of the deceased.
When interpreting a statute, the Court’s purpose is to ascertain and effectuate the legislative intent at the time it passed the act. Justice Viviano explained that the 1939 Legislature unequivocally repealed the statutory grounds for an estate to recover anything that was not specifically included in the damages provision of the post-1939 WDA. Thus, after that change, the Supreme Court held that the WDA’s damages provision provided an exclusive list of the types of damages that could be recovered for injuries resulting in death, regardless of whether the decedent’s death was instantaneous or sounded as a survival action. The newly combined WDA specifically divided the damages recoverable into three classes:
(1) “Pecuniary injury;”
(2) “Reasonable medical, hospital, funeral and burial expenses;” and
(3) “The pain and suffering” of the decedent before death.
In 2016, the Court of Appeals expanded the categories of damages available under the current version of the WDA, holding that damages for lost future earnings are recoverable. The Denney case was an action to recover damages stemming from a motorcycle accident. The panel said that damages for lost wages and lost earning capacity were recoverable under the highway exception to the governmental tort liability act. The Denney Court reasoned that “economic damages include ‘damages incurred due to the loss of the ability to work and earn money…” As a result, the panel concluded that damages for lost future earnings are allowed under the WDA. But the Court of Appeals didn’t provide any meaningful additional analysis to support its holding that lost future earnings are recoverable under the WDA, and the Supreme Court refused to take the case.
In this case, the Court of Appeals held that Baker was superseded by an intervening change in the law. That Court observed that the version of the WDA in effect when Baker was decided “lacked the ‘including’ language in the current statute.” The Court noted its previous holding in Denney that “although lost earnings are not explicitly specified in MCL 600.2922(6), the Legislature’s use of the word ‘including’ before the enumerated list of the kinds of damages available meant that the list is not exhaustive[.]” Believing it was bound by Denney, the Court of Appeals held that the plaintiffs could recover for Jawad’s lost future earnings to the same extent the victim could have recovered those damages had he survived.
Justice Viviano explained for the 1971 amendments to strike the and allow damages for future earnings in both survival actions and death actions, the changes must be clear and “speak in no uncertain terms.”
“Pecuniary Injury”
The Supreme Court said that the removal of the “pecuniary injury” phrase in the WDA was not intended to change the relationship between survival actions and the WDA, i.e., that survival actions were subject to the damages limitations and other requirements of the WDA. Instead, the Supreme Court has held that the deletion of this phrase and the addition of the provision allowing damages for “loss of . . . society and companionship,” which the Court described as a “major revision” of the 1971 amendments, “can only be viewed as a clear rejection of the notion that damages for loss of companionship were not allowed under the WDA because they did not qualify as a “pecuniary injury.”
Plaintiffs next argued that the addition of “under all of the circumstances” in the 1971 amendments in place of the “pecuniary injury” phrase showed that the Legislature wanted to broaden the types of damages that could be recovered. But the phrase “under all of the circumstances” appeared after the phrase “in every such action the court or jury may give such damages, as, the court or jury, shall deem fair and just.” This invokes the jury’s role of determining the amount of damages, not the type of damages, Justice Viviano said.
The Addition of the Term “Including”
The addition of the word “including” was interpreted by the Court of Appeals to mean that the types of damages listed in the statute are non-exhaustive. But in light of the extensive statutory history of the survival act and the WDA and the caselaw interpreting them, the Supreme Court wasn’t persuaded that, by inserting the word “including” into the WDA as part of the 1971 amendments, the Legislature intended to convert what had long been an exhaustive list into an open-ended list of damages types left entirely to the discretion of the jury. Thus, the Supreme Court didn’t believe that the insertion of “including” demonstrates that the Legislature acted with sufficient clarity to overrule Baker and abrogate the common law.
Loss of Financial Support
Finally, the Court’s reading of the statute also found support in the 1985 amendments, which added another specific type of damages to the WDA: loss of financial support. “Under [the negative-implication] canon of statutory construction, the express mention of one thing implies the exclusion of other similar things,” the justice wrote, quoting a 2022 decision. But that canon doesn’t apply without a strong enough association between the specified and unspecified items.
Here, Justice Viviano said that such an association exists between “loss of financial support” and “loss of future earnings.” Both types of damages involve money that the victim would have made, but damages for “loss of financial support” based on those earnings are limited to the “actual pecuniary loss suffered by one entitled to or receiving support from the deceased . . . .” The justice said that the fact that the Legislature adopted only one of them in the 1985 amendments indicates that it was doing so to the exclusion of damages for a decedent’s future earnings (or at least to clarify that they were not permitted). For all of these reasons, the Supreme Court concluded that Baker was not superseded by intervening changes in the law.
The Court of Appeals erred by failing to apply Baker. Baker’s holding was never explicitly superseded by the Legislature or clearly overruled by this Court. Therefore, the Court of Appeals was bound to follow it. The Supreme Court reaffirmed Baker’s holding that lost-earning-capacity damages are not available under the WDA. The Court overruled Denney and Thorn to the extent that they were inconsistent with this opinion. The judgment of the Court of Appeals was reversed. Nawal Daher v. Prime Healthcare Servs.-Garden City, LLC, 2024 Mich. LEXIS 1442, 2024 WL 3587935 (Mich. July 30, 2024).
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