Austin v. Trotters Corp.

Austin v. Trotters Corp., 815 S.W.2d 951 (Mo. App. S.D. 1991).

Plaintiffs Joy Austin ("Joy"), and Ransford Austin, her husband, filed this action against defendant Trotter's Corporation ("Trotter's"). The petition alleged that on December 18, 1987, Joy was an invitee in defendant Trotter's restaurant in Springfield and sustained a fall as a result of Trotter's negligence. Joy sought damages for personal injuries and losses she sustained as a result of the fall. Ransford sought recovery on his claim for loss of services of his spouse.

While the action was pending on the original petition, the trial court entered its order sustaining Trotter's motion for summary judgment with respect to the claim of Joy. Trotter's motion was based on a release executed by Joy in favor of Trotter's on February 15, 1988.

Thereafter, the plaintiffs filed an amended petition and added these four defendants: Great Central Insurance Company ("Great Central"), GAB Business Services, Inc. ("GAB"), Donald M. Johnson, and Mark P. Lucas. Count III of the amended petition was filed by both plaintiffs and directed against Great Central, GAB, and Johnson. The trial court sustained Great Central's motion to dismiss Count III and a separate motion to dismiss Count III filed by GAB and Johnson. Count IV of the amended petition was filed by Joy against Great Central and Mark Lucas. The trial court sustained Great Central's motion to dismiss Count IV and a separate motion of Mark Lucas to dismiss Count IV for lack of personal jurisdiction.

With respect to its rulings on Counts III and IV, and its sustention of Trotter's motion for summary judgment with respect to Joy, the trial court entered a determination that there was no just reason for delay and designated each of those rulings final for purposes of appeal. Plaintiffs appeal.

Plaintiffs' first point is that the trial court erred in sustaining Trotter's motion for summary judgment with respect to the claim of Joy because there were genuine issues of material facts concerning the release, in that Joy "contested (sic) that the release was not intended to be a full and final release of all claims, was not supported by consideration, and/or was obtained by means of misrepresentation, fraud, and/or mistake."

Trotter's motion for summary judgment, with respect to the claim of Joy, was based on a release. The motion was supported by the affidavit of Donald Johnson, responses of plaintiffs to requests for admissions, the release itself, and the draft issued to Joy for the release.

According to the affidavit of Johnson, based on his personal knowledge as an adjuster for Trotter's insurer, Johnson mailed the release and a "medical proof of loss" to Joy. After retaining the documents in her possession for several days, Joy returned the documents to Johnson. The documents were "signed, witnessed, and notarized." While Joy had the release in her possession, she telephoned Johnson and "inquired as to exactly what the nature of the document was that she was signing." Johnson informed Joy that she was signing a release. Trotter's insurer, Great Central, issued a check to Joy in the amount of $291.49 for medical payments, and issued a check 1 in the amount of $180 to Joy as consideration for the release.

Plaintiffs admitted that Joy signed the release on February 15, 1988, that Joy was paid the sum of $180 by Great Central, and that Joy delivered the release to Johnson.

The release was signed by Joy on February 15, 1988, and witnessed by Mary L. Willard. By its terms, Joy, "for and in consideration of the sum of One Hundred Eighty ($180) Dollars, the receipt and sufficiency of which is hereby acknowledged," released Trotter's from all claims and causes of action arising out of the occurrence of December 18, 1988 (sic) 2 at "Trotter's Restaurant--Springfield, Mo."

In opposition to Trotter's motion for summary judgment, Joy filed an affidavit which, omitting its formal portions, reads: "The release which Trotter's Corporation has raised as a defense in this case is not supported by good and valuable consideration, and this plaintiff denies that any consideration was given for said release. In addition, representations were made by defendant's insurance carrier that the release presented for signature by this plaintiff was not a full and total release of all claims. Therefore, said release was obtained by misrepresentation, fraud or, at least, through mistake."

"Summary judgment is an extreme, drastic remedy and may be employed only where there are no genuine issues of fact and where the moving party is entitled to judgment as a matter of law...." See Zueck v. Oppenheimer Gateway Properties. On review, the appellate court examines the record in the light most favorable to the party against whom a summary judgment was rendered. The burden is on the party moving for summary judgment to demonstrate that there is no genuine issue of fact. A genuine issue of fact exists when there is the slightest doubt about a fact. See Mahurin v. St. Luke's Hosp.

Rule 74.04(e), 3 which deals with the form of affidavits supporting or opposing a motion for summary judgment, reads, in pertinent part:

"Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.... When a motion for summary judgment is made and supported as provided in this Rule 74.04, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this Rule 74.04, shall set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him."

An affidavit which fails to aver specific facts and relies only upon mere doubt and speculation fails to raise any issue of material fact. See St. Charles County v. Dardenne Realty Co. Conclusory allegations are not sufficient to raise a question of fact in summary judgment proceedings. See Missouri Ins. Guar. Ass'n v. Wal-Mart. Conclusions of law in affidavits are of no effect. See Stoffel v. Mayfair-Lennox Hotels, Inc.

Joy admitted signing the release and thus she had "the burden of proving its invalidity." See Gast v. Ebert. See Landmark N. Cty. Bank v. Nat. Cable Tr.

"The burden of proving consideration is upon the party relying on the agreement.... That burden is met by the introduction in evidence of the written agreement which recites consideration. 'The recitation of consideration in an agreement is prima facie evidence that consideration to support the agreement was present; it creates a presumption that the recitals are true, which presumption continues unless overcome by evidence to the contrary.' "

Sanger v. Yellow Cab Company, Inc., the court said:

"Releasees do not make settlement and take general releases merely to pay the releasor the first installment on what he should have, leaving the matter open for the releasor to come back for more if his injuries prove serious. On the contrary, a settlement is made and a general release taken for the purpose of foreclosing further claims. The releasee does not stand in a fiduciary relation to the releasor. The injured party is not required to make a settlement, and the general rule of freedom of contract includes the freedom to make a bad bargain."

In Sanger the issue was whether the release was procured by mutual mistake. There was no claim of fraud.

In Higgins v. American Car Co., plaintiff signed a general release for a personal injury claim but testified that the releasee's claim agent said the release "was only a receipt for wages lost." Plaintiff asserted that the release was procured by fraud. In Higgins, the court said:

"The rule is that the one who signs a paper without reading it, if he is able to read and understand, is guilty of such negligence in failing to inform himself of its nature that he cannot be relieved from the obligation contained in the paper thus signed, unless there was something more than mere reliance upon the statements of another as to its contents."

The foregoing language in Higgins was quoted with approval in Sanger.

In Poe v. Illinois Cent. R. Co., the court discussed many Missouri cases dealing with releases which were attacked as having been obtained by fraud. The court said:

"An analysis of the cases reveals that they turn on the nature of the transaction involved, the representations made by the representor, the relation existing between the parties--whether one of trust, or confidence, or friendship, or close acquaintance, or that of strangers dealing at arm's length--or the trick or artifice, if any, employed."

The court said:

"While the law affords every one reasonable protection against fraud, it does not go to the romantic length of establishing the relation of parent and child or guardian and ward between courts and adults capable of managing their affairs, in full possession of their faculties and unrestrained in action, and indemnify them when dealing at arm's length against the consequences of their own indolence, listless inattention, or unwarranted credulity in the transaction of business affairs. Under the authority of the Dryssen [v. Union Electric Light & Power Co.], Higgins, Brennecke [v. Ganahl Lumber Co.], Hannah [v. Butts], and Alford [v. Wabash Ry. Co.] Cases (to the effect, as between parties dealing at arm's length, a representation that a release is merely a receipt is not, standing alone, actionable fraud ) and the Conklin [v. Missouri Pac. R. Co.] Case (to the effect that the courts will not protect those, who with full opportunity to do so, will not protect themselves), supra, defendant's demurrer should have been sustained. The most casual glance at the printed portions of the release or release-draft by one able to read would have disclosed the contract was one of release and settlement; and the case appears to be within the observation Judd v. Walker: 'If one voluntarily shuts his eyes when to open them is to see, such a one is guilty of an act of folly (in dealing at arm's length with another) to his own injury; and the affairs of men could not go on if courts were being called upon to rip up transactions of that sort.' " 4 (Emphasis added.)

Joy's affidavit, quoted above, contains three sentences. The first sentence says, in part, that the release is not supported by good and valuable consideration. That is a legal conclusion which is contrary to the fact contained in Johnson's affidavit, and admitted by Joy, that Joy received $180 for the release. The release itself recited that payment. The second half of the first sentence of Joy's affidavit contains her denial that "any consideration was given for said release." That statement is flatly contradicted by Joy's own admission that she was paid $180.00. If the first sentence of Joy's affidavit were held to be sufficient, she would be profiting by the fact that she herself makes conflicting statements. On this record, the first sentence is a false conclusion.

The second sentence of Joy's affidavit is an example of gamesmanship. It refers to "representations made by defendants' insurance carrier." The speaker or writer of the alleged representations is not identified. An "insurance carrier" speaks only through human beings, and no such person is named. It would be most charitable to construe the second sentence of Joy's affidavit to say "Johnson--or some other specific person--told me that the release was not a full and total release of all claims." Even if that construction is accorded the second sentence of Joy's affidavit, under the circumstances here it is inadequate.

The nine elements of fraudulent misrepresentations are set forth Clark v. Olson. The first two elements are "a representation" and "its falsity." The second sentence of Joy's affidavit does not satisfy those two elements. This release was "not a full and total release of all claims," the statement Joy attributes to the unidentified person, because there was a medical payments provision in the Great Central policy and Joy in fact was paid, separately, $291.49 for medical payments. Indeed, in Count II of the amended petition, which is still pending in the trial court, plaintiffs seek recovery from Great Central under the medical payments provision of its policy. Thus, the representation, and there is only one, alluded to in the second sentence of Joy's affidavit was not false, even if that representation was made. Johnson, of course, denied making it, but that alone is of no moment.

The third sentence of Joy's affidavit is only a legal conclusion. Indeed, by the manner in which Joy phrases it, she expresses a lack of confidence in her claim of fraud because she qualifies her conclusion by saying, "or, at least, through mistake." No facts are stated on which to base a claim of mistake. 5

Plaintiffs' first point merely parrots the language of Joy's affidavit. The same is true of their argument under their first point. Neither the point nor the argument tells this court specifically what issue of material fact existed which would serve to invalidate the trial court's ruling on Trotter's motion for summary judgment.

In Wagoner v. Mountain Savings & Loan Association, a somewhat similar factual situation existed. The trial court sustained defendant's motion for summary judgment based upon the execution of a release and the plaintiffs' affidavits opposing the motion were insufficient. The court said, at 406:

"Summary judgment is the proper procedural instrument to bring to the front of formal pleadings the legal effect of the releases. The very purpose of summary proceedings is to pierce the sham of false generality of claims. The futility of a trial upon primary issues is apparent if the validity of the releases is to be ultimately determinative of the case. And the compulsion of [Federal] Rule 56 cannot be thwarted by the allegation of conclusion or general denial."

This court holds that the trial court did not err in sustaining Trotter's motion for summary judgment. Plaintiffs' first point has no merit.

Plaintiffs' second point is that the trial court erred in sustaining Great Central's motion to dismiss Count III and a separate motion to dismiss Count III filed by GAB and Johnson "because once [Joy's] underlying cause of action for personal injuries was extinguished by the summary judgment, Joy was entitled to prosecute her independent cause of action for fraud in the inducement and/or execution of the subject release."

Count III of the amended petition is prolix. Joy's own description of Count III is that it asserts "a cause of action against Great Central, GAB and Johnson on the theory that the subject release was obtained through fraud." Joy also says that the trial court has, by summary judgment, extinguished her underlying cause of action in tort based upon the release, and that "the enforcement of the release which extinguished her underlying cause of action has given rise to a separate and independent cause of action against Great Central, GAB and Johnson for fraud in the inducement and/or the execution of the release."

In Bockover v. Stemmerman, the court said:

"[W]here a release had been fraudulently obtained, there is no independent cause of action for the fraud practiced in obtaining the release. A release falls within this exception because if the allegation concerning the fraud which induced one to sign the release is true then the release is void both in law and in equity, and in executing the release the party has parted with nothing. The original cause of action remains viable and the release obtained by fraud will not bar that action. Since the underlying cause of action is not extinguished when the release is obtained by fraud, the party giving such release retains his right to recover on the underlying tort as if the release had not been given and therefore suffers no damage as a result of the fraud. For this reason there is no independent cause of action for fraud practiced in obtaining a release."

In making the foregoing statement, the court relied on Mackley v. Allstate Insurance, which in turn relied on Lomax v. Southwest Missouri Electric Ry. Co.

The court, in Mackley, pointed out that some jurisdictions do recognize that the releasor of an unliquidated tort claim may stand on a fraudulently induced release and maintain an action for fraud and deceit for the damages growing out of the fraud practiced upon him by a person other than the releasee.

The court, in Mackley, relied primarily on Lomax and said, at 637, that "Lomax has not been vitiated or overruled by Metropolitan Paving Co. v. Brown-Crummer Inv. Co."

Bockover, Mackley, and Lomax support the trial court's dismissal of Count III. Since there is an independent reason why that dismissal is sound, it is unnecessary for this court to determine if it agrees with the Western District that Lomax was not overruled by Metropolitan Paving Co.

By reason of the trial court's ruling on Trotter's motion for summary judgment, and this court's affirmance of that ruling, the release is valid and untainted by fraud. The issue of whether fraud was practiced by anyone upon Joy in order to obtain execution of the release has now been set at rest. Count III is based upon the allegation that such fraud existed and it has now been determined that fraud did not exist.

In Sunshine Realty v. Killian, this court discussed the doctrine of collateral estoppel, set forth the elements of that doctrine, and pointed out that it precludes the reexamination of previously litigated issues whether those issues are of fact or law. This court also pointed out that the doctrine may properly come into play "on the basis of an adjudication of a portion of one proceeding when that portion has become final prior to the review of other portions of that proceeding."

Count III is bottomed on a theory of fraud. This court's affirmance of the trial court's ruling on Trotter's motion for summary judgment decides the issue of fraud against Joy. It follows that Count III is now barred by collateral estoppel, and plaintiffs were not prejudiced by the order of the trial court dismissing Count III. "No appellate court shall reverse any judgment unless it finds that error was committed by the trial court against the appellant materially affecting the merits of the action." Plaintiffs' second point has no merit.

Plaintiffs' third point is that the trial court erred in sustaining Great Central's motion to dismiss Count IV of the amended petition "on the ground that the cause of action on the insurance policy, as pleaded in Count II of the amended petition, is plaintiffs' exclusive remedy because Supreme Court Rule 55.10 permits a party to plead in the alternative."

Great Central's motion, directed to Count IV, included the ground that Count IV failed to state a claim upon which relief may be granted against Great Central, (the "no claim ground"). The motion was sustained. Plaintiffs' third point makes no mention of the "no claim ground" on which the trial court's ruling on Count III was, at least in part, based.

"The burden is on the appealing parties to demonstrate error." See State, et al., Plaza Prop. v. Kansas City. On appeal, the trial court's judgment is presumed valid, and the burden is on appellants to demonstrate incorrectness of the judgment. See Delaney v. Gibson. A point relied on must state briefly and concisely what actions or rulings of the court are sought to be reviewed and wherein and why they are claimed to be erroneous. Rule 84.04(d). Allegations of error not briefed or not properly briefed shall not be considered in any civil appeal. Rule 84.13(a).

If the trial court states no reason for dismissal, the appellate court will assume it acted for reasons offered in the motion to dismiss. Chase Elec. Co. v. Acme Battery Mfg. Co. The appellate court will sustain a judgment of dismissal if any of the grounds for dismissal is proper. See Sullivan v. Pulitzer Broadcasting; and Henry v. Taft Television & Radio Co.

In order for this court to interfere with the trial court's dismissal of Count IV with respect to Great Central, it would have to conduct its own inquiry into the adequacy of Count IV to state a claim for relief. The statement of facts portion of plaintiffs' brief does not set forth any of the allegations of Count IV. The only reference to Count IV is this statement: "Appellant [Joy] sought recovery against [Great Central] on the theory of promissory estoppel."

Plaintiffs' third point has no merit because it fails to address the propriety of the trial court's dismissal on the "no claim ground" and because plaintiffs have failed to sustain their burden of showing that a dismissal on that ground was improper.

Plaintiffs' fourth point is that the trial court erred in sustaining the motion of defendant Mark Lucas to dismiss Count IV for lack of jurisdiction over his person because "a prima facie showing was made by plaintiffs that Lucas made a contract within this state and transacted business within this state and therefore Lucas was subject to the personal jurisdiction of the trial court under Rule 54.06(a)(1) and (2)."

In their argument under this point, plaintiffs state: Count IV alleges that Lucas made a contract in Missouri; Joy spoke with Lucas by telephone and informed him that she needed further medical and hospital treatment; Lucas promised that Great Central would authorize such treatment and would be responsible for the payment of the medical expenses incurred therefor; Joy relied on this promise and incurred medical expenses for said treatment; Lucas was an employee and agent for Great Central and performed his claim services, with respect to plaintiffs' claims, within the scope and course of his employment with Great Central.

In response to this point, Lucas advances two independent grounds in support of the trial court's dismissal. The grounds are: (1) Count IV shows on its face that Lucas cannot be personally liable and therefore no claim was stated against Lucas for which relief can be granted, and (2) there was lack of personal jurisdiction over Lucas.

The soundness of ground (1) makes it unnecessary to consider whether ground (2) is also sound.

"An agent is not liable for lawful acts done within the scope of his authority for and on behalf of a disclosed principal. The liability, if any, is that of the principal. If a contract is made with a known agent acting within the scope of his authority for a disclosed principal, the contract is that of the principal alone and the agent cannot be held liable thereon, unless credit has been given expressly and exclusively to the agent and it appears that it was clearly his intention to assume the obligation as a personal liability and that he has been informed that credit has been extended to him alone."

Missouri cases supporting the foregoing principles include State ex rel. Ranni Assoc. v. Hartenbach; Hunt v. Sanders; Moore v. Seabaugh; and Hamilton Music v. Gordon A. Gundaker Real Est.

Although Lucas's motion to dismiss did not specifically raise ground (1), that ground is properly asserted, even though it is raised initially on appeal. Rule 55.27(g)(2). Plaintiffs filed no reply brief and, perhaps understandably, make no effort to counter ground (1). Plaintiffs' fourth point has no merit.

This court holds that the trial court did not err in granting Trotter's motion for summary judgment with respect to Joy and in dismissing Count III and Count IV of the amended petition. The summary judgment entered in favor of Trotter's Corporation on March 13, 1989, and those portions of the order of November 17, 1980, which dismiss Counts III and IV of the amended petition are affirmed. It is so ordered.

PARRISH, P.J. and SHRUM, J., concur.

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1 The two "checks" were drafts.

2 The fall took place on December 18, 1987. No party mentions the obvious misprint in the release with respect to the year of the occurrence. The correct year is shown on the $180 draft which describes the date of loss as 12-18-87.

3 Except where otherwise indicated, all references to rules are to Missouri Rules of Court, V.A.M.R.

4 In Gast v. Ebert, the court said:

"In their affidavit, plaintiffs state that they were told by the defendant's insurer that the agreement which they signed was merely a receipt for moneys received to cover their daughter's medical bills. The counter-affidavit of insurer's claims representative states that the Gasts were not told that the agreement was merely a receipt for reimbursement of medical expenses. Based on these affidavits, there is a genuine dispute as to whether a representation was made. If the statement was made, and it must be assumed that it was since the record is viewed in the light most favorable to the plaintiffs, the representation was admittedly false because the defendant is attempting to enforce the agreement as a complete and binding release. The representation was clearly material since the plaintiffs' cause of action hinges on whether the document which they signed was a binding release or merely a receipt."

The court, in Gast, made no mention of Poe or the five cases cited in it to the effect that a representation that a release is merely a receipt is not, standing alone, actionable fraud. See also Higgins and Sanger cited above.

In the case at bar, Joy's affidavit makes no reference to a receipt, nor does she state that she was told the release was "merely a receipt."

5 In Bogus v. Birenbaum, the court said:

"The cancellation of a release on the ground of a mistake is ordinarily granted only where the mistake is mutual, but it will be granted where the mistake of one party is either known to the other party or is so obvious that it must have been known to him and the mistake concerns a matter so vital that it could be said that the parties, because of miscalculation or false information, never actually agreed to the same proposition."

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Another important case that combines the issues of personal jurisdiction and fraud is Wyman v. Newhouse, where a woman lied to the other party to induce him to come to Florida in order to have him served with process. See also Tickle v. Barton, where one party lured the defendant into another county so that he could have him served with process. The plaintiff in that unsuccessful suit persuaded the defendant to go to the other county by inviting him to a football banquet.

Huhtala v. Travelers Ins. Co.

Huhtala v. Travelers Ins. Co., 257 N.W.2d 640, 401 Mich. 118 (Mich. 1977).

Plaintiff Bonnie Cummings was injured in an automobile accident. The owner of the automobile in which Cummings was riding as a passenger was insured by defendant Travelers Insurance Company. Three years, two and one-half months after the accident, Cummings and her father, Arne Huhtala, commenced this action against Travelers and George Lynott, a Travelers claims manager, asserting that the defendants had promised the plaintiffs that a full and equitable settlement would be paid after Cummings' physical condition stabilized.

The defendants moved for accelerated judgment on the ground that plaintiffs' claims were barred by the statute of limitations. Plaintiffs responded that the defendants were precluded under the doctrines of promissory and equitable estoppel from asserting the bar of the statute.

The trial judge entered a judgment dismissing plaintiffs' complaint and the Court of Appeals affirmed. We reverse and remand for trial on the claim of promissory estoppel.

I

The automobile accident, in which Cummings sustained injuries requiring surgery, occurred on December 24, 1970. This action was commenced March 13, 1974.

The plaintiffs pleaded that the defendants, representing the owner of the automobile, communicated with them and arranged for Cummings to undergo plastic surgery. The defendants admitted these allegations, and averred that Travelers had paid the medical and hospital bills.

Plaintiffs further alleged, in Count I of their amended complaint, that they were told by Travelers' representatives "that a full and equitable settlement of the present cause would be paid once the Plaintiff, Bonnie Cummings', physical condition stabilized and the Defendant insurance company had had an opportunity to further evaluate the case following the above related plastic surgery"; that the statute of limitations had run; that Travelers had not made payment to the plaintiffs as promised; and that its refusal to make payment "constitutes a breach of express and implied contract based upon the representations made by the Defendants during the course of the negotiations."

Count II repeated all the allegations of Count I, adding that defendants' conduct "constituted a fraudulent misrepresentation." The complaint did not allege that the representations were knowingly false when made or that they were negligently made. Plaintiffs failed to plead with particularity the circumstances constituting fraud, as required by GCR 1963, 112.2, 1 and, although given an opportunity to file an amended complaint, 2 did not in their amended complaint expand on the allegation of fraud. The Court is of the opinion that, on remand, the trial court should not entertain a motion to amend the complaint to enlarge the allegation of fraud, the plaintiffs having failed to avail themselves of the opportunity afforded them to remedy this pleading deficiency.

Defendants' motion for accelerated judgment pursuant to GCR 1963, 116.1(5) raised the question whether plaintiffs' "claim is barred because of statute of limitations," and no question relating to the substantive aspects of plaintiffs' claims. The trial court and the Court of Appeals erred in determining, based on the pleadings, answers to interrogatories, and the arguments of counsel on the motion for accelerated judgment, the substantiality of plaintiffs' pleaded allegations of promissory and equitable estoppel. The substantiality question might have been raised by a motion for summary judgment under GCR 1963, 117.2(3), asserting that "there is no genuine issue as to any material fact, and the moving party is therefore entitled to judgment as a matter of law." 3 No such motion was filed; the only question before the trial court was whether plaintiffs' claims were barred by the statute of limitations.

II

This is not an action against the owner or driver of the automobile, but an action against the owner's insurer, Travelers, and one of its claims managers. While plaintiffs' claim of promissory estoppel, in Count I, against Travelers and its claims manager is in respect to the automobile accident, it is not based on that event. Rather it is based on an agreement assertedly entered into subsequent to that event.

Plaintiffs' claim is grounded in the rule of contract law that a promise which the promisor should reasonably expect to induce forbearance by the promisee or a third person and which does induce forbearance, "is binding if injustice can be avoided only by enforcement of the promise." 1 Restatement, Contracts, § 90, p. 110. 4

We are of the opinion that the time for bringing an action for promissory estoppel is governed by the contract statute of limitations, 6 years, and that plaintiffs' action was therefore timely commenced.

The principle governing our disposition was explained Southgate Community School District v. West Side Construction Co., where this Court held that the 3-year statute of limitations governs a consumer's action against a manufacturer to recover damages for injury to property, whether plaintiff's claim is pleaded on a theory of negligence, implied warranty or breach of contract for sale under UCC § 2-725. 5

Southgate had argued that decision was controlled by Weeks v. Slavik Builders, Inc., where the 6-year statute was found to be applicable. This Court responded:

"In Weeks, the cement roofing tiles had been expressly warranted by defendant builder before installation. It was therefore in this contractual context that this Court held that plaintiff Weeks' action was not barred by the three-year statute of limitations.

"As discussed, supra, the consumer's right of action against a remote manufacturer is not dependent on the existence of contract or contract principles; product warranties adhere by implication of the law. Weeks is not controlling. The three-year statute governing actions 'to recover damages for injuries to property' applies to this case." Southgate Community School District v. West Side Construction Co.

An action for personal injury or property damage against an owner or driver of an automobile arises by "implication of the law" and is governed by the 3-year statute of limitations. 6 Plaintiffs' claim of promissory estoppel against Travelers and its claims manager is "dependent on the existence of contract or contract principles" and is governed by the 6-year statute of limitations. 7

III

Where the nature and origin of an action to recover damages for injury to persons or property is a duty imposed by law, this Court has held that it cannot be maintained on a contract theory when commenced beyond the 3-year period. See Coates v. Milner Hotels, Inc.; Baatz v. Smith; and State Mutual Cyclone Insurance Co. v. O & A Electric Cooperative. Those cases do not control where the action is for breach of an express promise.

In Coates, the plaintiff had been assaulted by an intoxicated person while a guest in defendant's hotel. He sought to recover for negligence and breach of an implied warranty to protect a guest against intrusion while in a room. In holding that the 3-year period governed the time for commencement of both the negligence and implied warranty counts, the Court reasoned that whether pleaded as ex contractu or ex delicto the "nature and origin" of the claim was negligence. Although the relationship between the innkeeper and guest was contractual, the source of the innkeeper's obligation was not an express promise but public policy: the law implies a covenant, coextensive with the duty imposed on a negligence theory, that an innkeeper will take appropriate steps to guard a guest against assault.

Baatz, similarly, was an action against an innkeeper for personal injury caused by another person, a former guest of defendant's hotel who exploded dynamite in the hotel. In holding that the 3-year period applied although the action had been commenced in assumpsit, the Court said that it would adhere to Coates which had held that the 3-year period applies to all actions " 'to recover for an injury to the person arising because of negligence whether based upon implied contract or tort.'" See Baatz v. Smith.8

In State Mutual, also, the plaintiffs sought to recover for breach of contract although the defendant electric company was subject to liability "because of negligence." Plaintiffs' subrogors were farmers whose cattle had been electrocuted by a high-voltage power surge. Holding that the 3-year period governed, this Court said that the Legislature had not intended that the courts "distinguish between actions on express contracts to recover damages for injury to person or property and actions based upon implied contract, as called for by the Court of Appeals opinion." State Mutual Cyclone Insurance Co. v. O & A Electric Cooperative.9

In the subsequent case of Weeks v. Slavik Builders, Inc., this Court held that the 6-year period governs an action for breach of an express warranty to install "cement tiles which would measure up, in roofing service, to the warranties made." The Court said that the breach of that warranty was not a damage to property within the meaning of the 3-year statute. 10

Coates, Baatz, State Mutual and Weeks are reconcilable. While there was an express contract in all four cases, the "promise" sought to be enforced in State Mutual (as in Coates and Baatz ) appears to have been implied by law, in contrast with Weeks where the promise was express. 11 The obligation of a public utility to supply electricity at an appropriate voltage (like the obligation of an innkeeper to protect his guests against assault) does not depend on the agreement of the parties but arises as a matter of law independent of the terms of their agreement.

In Parish v. B. F. Goodrich Co., the issue was not which of several limitation periods provided by Michigan statutes applies but whether the Michigan borrowing statute made applicable the periods of limitation of another state. 12

While the relationship of the parties in Coates, Baatz and State Mutual was contractual express contract the nature and origin of the claim sought to be enforced in those cases was not an express promise. The relationship of the supplier of services with the consumer, although contractual in inception, gave rise to a duty imposed by law on the supplier, apart from the terms of their agreement, to take reasonable safeguards to protect the consumer. Here, however, the nature and origin of plaintiffs' claim for promissory estoppel is an express promise and not a duty imposed by law.

IV

In the instant case, the law imposed on Travelers no duty in favor of the plaintiffs to pay or to promise to pay a fair settlement. If such an obligation arose, it is because Travelers chose to promise to do so. While plaintiffs had a personal injury claim against the owner of the automobile in which Cummings was riding and that claim arose by reason of a duty imposed by law, Travelers had no obligation to the plaintiffs as a result of any duty imposed by law. Plaintiffs' sole claim against Travelers has been and is contractual.

The nature and origin of this action against the owner's insurer and its claims manager is not the same as the nature and origin of an action against an owner or driver of another automobile.

The liability of the owner and driver is imposed by law and is non-consensual; the liability of the insurer and its claims manager is based on an express promise and is consensual.

Plaintiffs need not show, in this action against the insurer and its claims manager, that the owner or driver of the automobile was subject to liability because of the driver's causal negligence and Cummings' freedom from contributory negligence, but must show a promise to pay.

Plaintiffs may not recover the full money equivalent of their losses, but only the amount defendants assertedly promised to pay.

Plaintiffs' claim against Travelers and its claims manager did not accrue at the time of the automobile accident but at the time of the asserted breach of contract.

The plaintiffs' negligence claim against the owner-driver of the automobile and their promissory estoppel claim against the owner's insurer and its claims agent are different claims. This contrasts with a consumer's claim against a manufacturer, dealt with in Southgate, which is but a single, unitary claim, however many legal theories may have been invoked to explain or develop that claim. 13

An insurer's promise to pay an owner-driver whatever amount, within policy limits, is determined to be the owner-driver's legal liability to an injured person, and an insurer's promise to pay an injured person a definite amount or an amount determinable under a reasonably definite standard 14 are different promises, giving rise to different claims. The former claim is derivative, and the injured person's right of action against the insurer is dependent on successful maintenance of his claim against the owner-driver. The latter claim is not derivative in that the injured person's right of action against the insurer is not dependent on successful maintenance of its claim against the owner-driver.

While plaintiff's claim is in respect to Cummings' injury, this action is not to "recover damages for injuries to persons or property" but, rather, to recover damages "for breach of contract" to pay a full and equitable settlement and is, therefore, governed by the 6-year, not the 3-year, statute of limitations.

V

Both parties briefed, and the trial court and the Court of Appeals considered the authorities concerning the doctrine of equitable estoppel. 15

Equitable estoppel is essentially a doctrine of waiver. When operative, it serves to extend the applicable statute of limitations by precluding the defendant from raising the bar of the statute but has no effect on the determination of the applicable statute. Promissory estoppel, in contrast with equitable estoppel, 16 does not establish waiver but, rather, substitutes for consideration in a case where there are no mutual promises, enabling the promisee to assert a separate claim against the promissor, independent of any other claim he may have against the promissor (e. g., subrogation or misrepresentation) or another person (e. g., negligence) and, therefore, makes applicable the statute of limitations governing the time for bringing an action for breach of contract.

Plaintiffs' claim of promissory estoppel against Travelers and its claims manager does not depend on the doctrine of equitable estoppel, and, therefore, whether or not they can establish the elements of equitable estoppel, they may be able to recover on the ground of promissory estoppel.

We do not wish to be understood as indicating any view on the merits of plaintiffs' claim. We hold only that Count I of the complaint states a claim of promissory estoppel, albeit somewhat inartfully, and that the 6-year statute of limitations governs the time for commencing an action stating such a claim.

Reversed and remanded for trial on the claim of promissory estoppel.

KAVANAGH, C. J., and WILLIAMS, FITZGERALD and MOODY, JJ., concur.

COLEMAN, Justice (To Reverse).

This action, grounded in a personal injury claim, is governed by a 3 year statute of limitations. Our colleagues said that plaintiffs' complaint "states a claim of promissory estoppel, albeit somewhat inartfully" and thereby transforms a tort into a contract action governed by a 6 year statute of limitations. The complaint, if inartful, was so much so that no one plaintiff, defendant, trial judge or Court of Appeals judges knew that such a theory was involved here. To the contrary, plaintiffs admit the 3 year statute of limitations applies. However, we would reverse the Court of Appeals and remand to the circuit court to allow plaintiffs to demonstrate through proper evidence, if they can, that the equity of their case should prevent the statute's application.

I

Bonnie Cummings was injured in an automobile accident on December 24, 1970. In a complaint filed March 13, 1974, she claimed to have suffered head injuries, permanent scarring, "nervous and emotional sequelae," "an aggravation of preexisting conditions of ill being," and "pain, agony and distress, past, present and future". In the same complaint her father, Arne Huhtala, claimed to have "incurred special damages" such as "personal property damage, travel, physicians and surgeons" and the like.

Plaintiffs claim in Count I of the complaint that George Lynott, an agent for Travelers Insurance, "made representations to the plaintiffs (that) all of their damages would be fairly and justly compensated". They said Travelers "always represented that a fair and just settlement would be paid" after Bonnie Cumming's condition "had stabilized" and "assessment of the value of (the) case could be made by said insurance company and its representatives". They said Travelers "failed, refused and neglected to make payment to the plaintiffs as promised". This refusal "constitutes a breach of express and implied contract".

However, plaintiffs admitted that "the statute of limitations ran in this cause".

Defendants moved for accelerated or summary judgment, saying the statute of limitations barred the action. Noting plaintiffs' claim of an express or implied contract, defendants said the Michigan rule "is that actions which are seeking to recover for injuries to persons or property are governed by the three year statute of limitations irrespective of how the plaintiff proceeds to such recovery".

After giving plaintiffs 20 days in which to amend the pleadings, which was done, the trial court dismissed the case and the Court of Appeals affirmed.

II

Defendants (and plaintiffs) were right concerning the 3 year statute of limitations. In Parish v. B. F. Goodrich Co., we said the Court "has consistently held that the three-year limitational period applicable to" claims such as plaintiffs' "applies without regard to whether the claim sounds in tort or contract, express or implied". 1

Defendant cited the three cases from which Parish drew its conclusion. In Coates v. Milner Hotels, Inc., the plaintiff was assaulted in her room by an intruder. One of her theories for recovery was breach of an implied contract. The Court had to decide if "an action to recover damages for personal injuries upon an implied contract theory (is) subject to the three-year limitation". It found "the better rule to be that actions for personal injuries, resulting from negligence although arising out of a breach of implied contract, are controlled by the statutory limitation of actions upon damages for injuries to the person".

The plaintiff Baatz v. Smith argued that the three year limit "applies only to actions sounding in tort but not to those brought in assumpsit even though based on tortious acts which are claimed to constitute, as well, a breach of contract". Citing Coates the Court said, "whether brought in tort or assumpsit, these are actions to recover damages for injuries to person". The 3 year limit applied.

This Court reversed the Court of Appeals in State Mutual Cyclone Insurance Co. v. O & A Electric Cooperative, wherein plaintiff sought recovery for property damage covered by breach of an express contract. The Court of Appeals said the 3 year limit applies "where an action is brought to recover damages for injury to person or property on a claim arising out of a tort or an implied contract". However, it continued, if the action "is brought on an express contract the 6 year statute applies, even though damages are sought for injuries to person or property".

In reversing, the Court noted that the Court of Appeals "did not cite a single Michigan case, or a case from any other jurisdiction . . . and its decision is contra to the great majority rule in the United States". The Court said Baatz means "that it makes no difference what form of action the plaintiff institutes in seeking recovery for damages to property or person, but in all cases such action comes within the 3-year limitation rule".

III

The complaint in our case is based on personal injuries caused by allegedly tortious conduct. Labels do not change this nor does the fact that plaintiffs are suing the driver's insurance company. Our colleagues' use of a promissory estoppel theory to find that this action "is governed by the contract statute of limitations, 6 years" is contrary to precedent as discussed above. The application of "promissory estoppel" in the transformed context proposed in my brothers' opinion might be appropriate in an action concerned with contract damage instead of personal and property injuries. 2 There the 6 year limitation would apply in any event and the issue would be only the tolling of the statute.

However, that is not our case. Here, it is acknowledged that the action originates from tort and the only question is whether the 3 year limitation is tolled.

The 6 year theory is even contrary to what plaintiffs sought in the courts below. After defendants' presentation on the motion for summary accelerated judgment, plaintiffs said "as far as the law goes, we agree, and of course we state this in our complaint, that the statute of limitations did run, but we rely upon the doctrine of promissory estoppel in this case". However, plaintiffs explained "sometimes (the doctrine is) called equitable estoppel and sometimes promissory estoppel". The trial court also referred to plaintiffs' "theory of promissory or equitable estoppel". Counsel and court used the terms interchangeably. Now, some of this Court assert that by the same names we can at this level create a different rose. We would not retry plaintiffs' case.

When the court granted defendants' motion to dismiss, it said plaintiffs' position was that "under the theory of equitable estoppel the statute of limitations did not run since defendants were estopped through their conduct". If plaintiffs are "to have available the doctrine of equitable estoppel" they need to show that "misrepresentations were made," they "relied on such misrepresentations" and "as a result thereof the statute of limitations ran".

Plaintiffs did not object to the court's characterization of their theory. They did file an amended complaint within the 20 days assigned. Their attorney suggested in oral argument that the case go to trial and "if the court is satisfied or believes there is no basis for a cause of action on the equitable estoppel theory that it would grant the defendants' motion for a directed verdict". The court instead granted defendants' motion to dismiss.

In Renackowsky v. Board of Water Commissioners, the Court remanded the case to permit plaintiff an opportunity to show "that, before the time fixed by statute for the bar, the defendant, by its course of conduct, led the plaintiff to believe that a suit to enforce his rights would be unnecessary, and thereby lulled him into a feeling of security". Klass v. Detroit noted that estoppel "seems to be limited to cases involving an intentional or negligent deception". Klass indicates that the defendant may raise the statute of limitations "unless it can be fairly said" that plaintiffs were induced to postpone action "upon some reasonably well grounded belief" that the claim would be adjusted if they did not sue. 3

We believe plaintiffs should have an opportunity to present their case. The question of whether equitable estoppel applies cannot be fairly answered solely on the bases of these pleadings and interrogatories. 4 There are problems here which require more detail. For example, what did defendant precisely promise, was plaintiffs' reliance reasonable, was plaintiffs' 2 year wait after surgery reasonable, should plaintiffs or defendants have taken additional steps? It is plaintiff's obligation to demonstrate that equitable estoppel should apply. We reverse and remand to the trial court to give them the opportunity.

RYAN, J., concurs.
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1 "Fraud, Mistake, Condition of the Mind. In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge, and other condition of mind of a person may be averred generally."

2 See GCR 1963, 115.1, Motion to Correct or Strike Pleadings:

".1 Motion for More Definite Statement. If a pleading is so vague or ambiguous that it fails to comply with the requirements of the rules, the opposite party may move for a more definite statement before filing his responsive pleading. The motion shall point out the defects complained of and the details desired. If the motion is granted and is not obeyed within 10 days after notice of the order or within such other time as the court may fix, the court may strike the pleading to which the motion was directed or make such other order as it deems just."

3 The disputed questions of fact regarding equitable estoppel to raise the defense of statute of limitations might have been resolved pursuant to the GCR 1963, 116.1(5) motion if the court had, as provided in GCR 1963, 116.3, ordered an immediate trial of the disputed issue.

4 "A promise which the promissor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise." 1 Restatement, Contracts, § 90, p. 110.

Similarly, see Restatement 2d, Contracts (Tentative Draft No. 2, 1965), § 90, p. 165; Calamari & Perillo, Contracts, § 99, p. 172; 1 Williston on Contracts, § 140, p. 607; 1A Corbin on Contracts, § 193, p. 187, et seq.

5 M.C.L.A. § 440.2725; M.S.A. § 19.2725.

6 "No person may bring or maintain any action to recover damages for injuries to persons or property unless, after the claim first accrued to himself or to someone through whom he claims, he commences the action within the periods of time prescribed by this section.

"(7) The period of limitations is 3 years for all other actions to recover damages for injuries to persons and property."

7 "No person may bring or maintain any action to recover damages or sums due for breach of contract, or to enforce the specific performance of any contract unless, after the claim first accrued to himself or to someone through whom he claims, he commences the action within the periods of time prescribed by this section.

"(8) The period of limitations is 6 years for all other actions to recover damages or sums due for breach of contract.”

8 The statement in the Committee Comment accompanying the Revised Judicature Act that the section of the Revised Judicature Act establishing the time periods for bringing an action to recover damages for injuries to persons or property "is a compilation of the limitations on the general tort remedies," indicates a legislative purpose to establish the time periods for actions sounding in tort.

9 The Court of Appeals, distinguishing Coates v. Milner Hotels, Inc.; and Baatz v. Smith, on the ground that no express contract was there asserted, and reasoning that "a party injured by the breach of an express contract when the breach involves negligence may waive his contract action and sue in tort or waive the tort and sue on contract," concluded that the 6-year statute of limitations applied. See State Mutual Cyclone Insurance Co. v. O & A Electric Cooperative.

10 In Striker v. Martindale, the Court held that the 3-year period, applicable to "all other actions" to recover damages for injury to persons or property rather than the 2-year period for actions charging assault, governed the time for bringing an action for personal injury sustained in a hunting accident where the declaration contained allegations of negligence (governed by the 3-year provision) and of assault and battery (governed by the 2-year provision):

"In determining whether the statute has run on plaintiff's cause of action he is entitled to the benefit of the allegations of a cause of action, if any, against which the statute has not run."

11 While the Court of Appeals in Weeks had ruled that a builder impliedly warrants the fitness of construction, on the further appeal to this Court that aspect of the case was not addressed. Although the obligation of innkeepers and public utilities to provide adequate safeguards for the protection of the public has long been imposed by law, it is only recently that courts have recognized that a builder may, apart from agreement, be subject to liability for defects in construction. The nature and origin of the claim enforced by this Court in Weeks was an express promise and not a preceding obligation imposed by law.

12 In Parish v. B. F. Goodrich Co., there was no contractual relationship between the plaintiff and the defendant the plaintiff was a consumer and the defendant a manufacturer and, hence, no issue arose regarding the applicable limitation where plaintiff's claim is assertedly based on contract.
In concluding that the product liability claim of a consumer against a manufacturer accrued, for purposes of the borrowing statute, when and where damages are suffered, this Court declared that UCC 2-725 "did not create a new and separate consumer's product liability claim against the manufacturer," distinguishable or different from the claim of the consumer against the manufacturer on a theory of negligence or implied warranty. The observation, on the authority of State Mutual Cyclone Insurance Co. v. O & A Electric Cooperative, supra, that the Court had consistently held that the 3-year period "applies without regard to whether the claim sounds in tort or contract, express or implied," Id., was not necessary to decision and overlooked Weeks v. Slavik Builders, Inc., supra, where the Court had held that the 6-year statute applies to an action for breach of an express warranty.
In contrast with the consumer's product liability right of direct action against the manufacturer, the nature and origin of which was duty imposed by law (negligence, misrepresentation, strict liability in tort, implied warranty) and which did not depend on the existence of any contractual relationship between the consumer and the manufacturer, the claim enforced in Weeks was not based on a duty imposed by law, dubbed implied warranty, but was based, rather, on the builder's express promise to guard against the risk of loss alleged to have occurred.

13 See Cova v. Harley Davidson Motor Co.; Parish v. B. F. Goodrich Co., supra.

14 The parties have not briefed or argued the enforceability of an agreement to pay a "full and equitable settlement" and therefore we have not considered that possible question. See 1 Corbin on Contracts, § 99, pp. 444-445; 1 Williston on Contracts (3d ed), § 41, pp. 129-135.

15 See, e. g., Renackowsky v. Board of Water Commissioners of Detroit; Klass v. Detroit; and Yarger v. Hastings.

16 The distinction between promissory and equitable estoppel is discussed in Dobbs on Remedies, § 2.3, pp. 42-43:

"There are, of course, estoppels having promissory elements. Some of these qualify as promissory estoppel cases in the sense that detrimental reliance on one side will suffice as 'consideration.' In other instances, the promissory elements may be more attenuated, and may not involve any substitute for consideration or any contract at all. The insurance adjuster who negotiates with the plaintiff for a settlement may 'lull' a plaintiff into a false sense of security so that he fails to file suit before the statute of limitations has run, and this may work as an estoppel against the insurance company. Such a case involves a promissory element in the limited sense that the adjuster's conduct does not operate to mislead about a present fact; it operates to mislead about future intended conduct, specifically it operates to make the plaintiff believe that the insurer will not raise the statute of limitations defense. But lulling is not necessarily promising, and even if the insurance company has made no enforceable promise, it may be estopped in such a case."

17 See Borman's v. Lake State Development Co., saying the "vehicle of recovery (contract, tort, fraud, e. g.) is not determinative". In such cases, the "crucial" question "is whether or not the plaintiff was seeking damages for injury to property or person in which case the three year statute applies". See also Harrington v. Nelson; Smith v. Gilles; and Fries v. Holland Hitch Co.

18 See Southgate Community School District v. West Side Construction Co.

19 See also Yarger v. Hastings; and DiGiovanni v. Yacenick.

20 Count II of plaintiffs' amended complaint charges fraudulent misrepresentation, but offers no facts in support, nor were such offered in oral presentations. We find no merit in the charge and will discuss it no further.