Facts
- Katherine Lane enrolled her 18-month-old daughter in Kindercare’s day-care facility.
- On December 9, 1992, Lane dropped off her daughter around lunchtime and signed an authorization permitting Kindercare employees to administer prescribed medication that day.
- Shortly after 5:00 p.m., an employee placed the sleeping child in a crib in the infant room.
- Around 6:00 p.m., employees locked the facility and left, apparently unaware the child remained inside.
- When Lane arrived to pick up her daughter, the building was locked and dark; she called 911.
- Police saw the child asleep through a window; an officer broke a window and removed the child.
- The child was upset but not physically injured.
- Lane observed the medication authorization form had not been initialed to show the medication was given and alleged she suffered serious emotional distress.
- Lane sued for breach of contract, statutory and regulatory violations, negligence and gross negligence, and sought exemplary damages.
Issues
- Whether emotional-distress damages are recoverable for breach of a day-care contract involving care of a young child, even absent physical injury.
- Whether Michigan’s Child Care Organizations Act creates an implied private cause of action for parents against a child-care provider for statutory or regulatory violations.
- Whether the trial court properly denied leave to amend the complaint.
Decision
- The court affirmed in part and reversed in part the summary disposition granted under MCR 2.116(C)(8).
- It reversed dismissal of the breach of contract claim, holding emotional-distress damages may be recovered for breach of a personal contract concerning matters of mental concern and solicitude.
- It affirmed dismissal of claims premised on the Child Care Organizations Act, holding the statute provides no private cause of action.
- It affirmed denial of leave to amend because the proposed amendments would have been futile, even though the trial court’s stated reason for denial was improper.
- The case was remanded for further proceedings on the breach of contract claim.
Legal Principles
- A motion under MCR 2.116(C)(8) tests the legal sufficiency of the pleadings; well-pleaded factual allegations are accepted as true.
- Michigan generally does not allow emotional-distress damages for breach of a commercial contract, but such damages may be recoverable for breach of a personal contract concerned with mental concern and solicitude.
- A child-care agreement for the safety and care of a very young child may be treated as a personal contract, making emotional-distress damages reasonably within the parties’ contemplation at contracting.
- In the personal-contract setting, emotional-distress damages for breach do not require proof of physical injury.
- The Child Care Organizations Act’s administrative and criminal enforcement scheme indicates legislative intent not to create an implied private cause of action for parents.
- Leave to amend may be denied when amendment would be futile because the amended pleading would still fail to state a legally cognizable claim.
Conclusion
The court held that a parent may pursue emotional-distress damages for breach of a day-care contract characterized as personal in nature, but may not sue under the Child Care Organizations Act absent an express private remedy; the breach of contract claim was reinstated and remanded, while statutory and amendment issues were resolved for the provider.