A Michigan state appeals court has handed Michigan State University a full victory in a case in which it was sued after a spectator was struck in the head by a hockey puck at an MSU hockey game.
First, the court agreed with the school and affirmed a trial court’s decision to dismiss the plaintiff’s claim on governmental immunity grounds because MSU was less like a business out to make a profit and more like an educational institution, entitling it to the proprietary function exception.
Second, the court reversed the lower court’s decision not to grant governmental immunity on another argument. Specifically, it agreed with the defendant that the plaintiff had not followed the correct protocol, pursuant to MCR 2.116(C)(7) and (8), in filing the claim, triggering a shield.
The impetus for the litigation was an injury suffered by Carla Ward at a March 12, 2004 college hockey game at MSU’s ice arena. A hockey puck struck and injured Ward, who alleged in a subsequent lawsuit that a defect, specifically the lack of plexiglass protecting one section of spectators from the ice rink, caused the incident.
“Critically,” noted the court, the plaintiff never served the defendant with a notice of claim or information as required by MCL 691.1406. Instead, the plaintiff’s counsel mailed a letter on December 30, 2004 that was addressed to “Sir/Madam” at “MSU Munn Ice Arena, East Lansing, MI, 48823.” In the letter, counsel advised that he represented the principal plaintiff “in the matter of personal injuries she sustained as a result of an automobile accident” on March 12, 2004. The plaintiffs’ counsel mailed a second and similar letter on January 21, 2005. Both letters suggested that the matter be referred to the defendant’s insurance carrier and that counsel be contacted directly if the defendant lacked insurance. The letters did not indicate the specific cause or nature of the injury, the exact location and nature of any defect in the ice arena, or provide the names of any witnesses to the incident known to the plaintiffs.
Shortly after the suit was filed, the defendant moved for summary judgment. While the court recognized governmental immunity as it related to the aforementionedproprietary function exception, it was less receptive to granting immunity on the procedural argument, leading to MSU’s appeal.
In considering that appeal, the court noted that MCL 691.1406 provides in pertinent part:
“Governmental agencies have the obligation to repair and maintain public buildings under their control when open for use by members of the public. Governmental agencies are liable for bodily injury and property damage resulting from a dangerous or defective condition of a public building if the governmental agency had actual or constructive knowledge of the defect and, for a reasonable time after acquiring knowledge, failed to remedy the condition or to take action reasonably necessary to protect the public against the condition. Knowledge of the dangerous and defective condition of the public building and time to repair the same shall be conclusively presumed when such defect existed so as to be readily apparent to an ordinary observant person for a period of 90 days or longer before the injury took place. As a condition to any recovery for injuries sustained by reason of any dangerous or defective public building, the injured person, within 120 days from the time the injury occurred, shall serve a notice on the responsible governmental agency of the occurrence of the injury and the defect. The notice shall specify the exact location and nature of the defect, the injury sustained and the names of the witnesses known at the time by the claimant. The notice may be served upon any individual, either personally, or by certified mail, return receipt requested, who may lawfully be served with civil process directed against the responsible governmental agency, anything to the contrary in the charter of any municipal corporation notwithstanding. . . . Notice to the state of Michigan shall be given as provided in section 4. 1 . . . [MCL 691.1406; Emphasis added.]”
The appeals court agreed with the defendants that the plaintiffs “failed to serve a notice compliant with the statute on the defendant. Not only were the letters apparently not mailed certified, return receipt requested, they were not mailed to individuals who could accept civil process for defendant, did not contain the information required by the statute, and were not timely. Accordingly, the plain language of MCL 691.1406 requires dismissal of plaintiffs’ claims for injuries allegedly sustained by reason of an alleged defect in defendant’s ice arena.”
Turning to the plaintiff’s cross-appeal that the defendant is not immune from tort liability because the principal plaintiff’s injury resulted from a proprietary function, the court again sided with the defendant.
The Governmental Tort Liability Act (GTLA) “provides an exception to governmental immunity when an agency is engaged in proprietary functions.” MCL 691.1413 states as follows:
“The immunity of the governmental agency shall not apply to actions to recover for bodily injury or property damage arising out of the performance of a proprietary function as defined in this section. Proprietary function shall mean any activity which is conducted primarily for the purpose of producing a pecuniary profit for the governmental agency, excluding, however, any activity normally supported by taxes or fees. No action shall be brought against the governmental agency for injury or property damage arising out of the operation of proprietary function, except for injury or loss suffered on or after July 1, 1965.
“To constitute a proprietary function requires an activity ‘(1) must be conducted primarily for the purpose of producing a pecuniary profit, and (2) it cannot be normally supported by taxes and fees.’ Coleman v Kootsilas, 456 Mich. 615, 621, 575 N.W.2d 527 (1998). That the activity consistently generates a profit may evidence an intent to produce a profit. Id. But, that ‘is not sufficient to make the activity proprietary because generating a profit must be the primary motive.’ Harris v Univ of Michigan Bd of Regents, 219 Mich. App. 679, 558 N.W.2d 225 (1996)
“In Harris, we found that the University of Michigan was engaged in a governmental function under the GTLA in its operations of its athletic department and intercollegiate gymnastics team. We stated:
“Given the broad definition of a governmental function, and in light of the history of intercollegiate athletics at Michigan universities and colleges that has historic support from the Michigan Legislature, we find that intercollegiate athletics is a governmental function for purposes of immunity.”
The court continued, noting that the plaintiffs “contend that times have changed since Harris and argue that expansion of athletic facilities, firing and hiring of specific coaches, and concern with team success show that defendant intends to financially profit from its athletics department. In short, plaintiffs make factual allegations about defendant’s athletic program without making a meaningful legal argument. Plaintiffs allege that the department is profitable and claims that it receives $ 3,829,293 in revenue above its expenses, but defendant has offered an affidavit stating the ice hockey program specifically has been operating at a loss for the last 20 years. Plaintiffs also assert that the profits are used to sustain defendant, failing to recognize that ‘[a] governmental agency may conduct activity on a self-sustaining basis without being subject to the proprietary function exception.’ Harris, supra, at 690 (citation omitted).
“Harris requires us to hold that the defendant’s operation of its ice hockey program did not constitute a proprietary function. Further, regardless of Harris, the plaintiff has failed to show that the defendant operated its ice hockey program primarily to generate a profit.”
Carla Ward and Gary Ward v. Michigan State University; Ct. App. Mich.; No. 2810872010 Mich. App. LEXIS 5; 1/7/10.
