Facts
- Beckie Price and her then-husband built a home in DeWitt, Michigan, in 1975 that was originally heated by an oil furnace.
- In 2006, Price replaced the oil furnace with a propane furnace and ended her oil-service contract, but the home’s oil fill pipe remained in place.
- In November 2007, High Pointe Oil mistakenly placed Price’s address on its “keep full” list.
- While Price was away, a High Pointe driver pumped nearly 400 gallons of fuel oil into the basement through the oil fill pipe before discovering the error and calling 911.
- The spill created an environmental hazard requiring demolition of the house and destroying many belongings.
- Insurance and related payments covered remediation, construction of a new home on the property, cleaning or replacement of personal property, and temporary housing; Price was fully compensated for economic losses.
- Price sought noneconomic damages for mental anguish, emotional distress, and psychological injuries caused by the negligent destruction of her home.
Issues
- Under Michigan common law, may a plaintiff recover noneconomic damages (e.g., mental anguish and emotional distress) for the negligent destruction of real property when the claimed loss is solely property damage?
Decision
- The Michigan Supreme Court reversed the Court of Appeals.
- The court held that noneconomic damages are not recoverable for the negligent destruction of property (real or personal) when the claim is solely for property damage.
- The court remanded for entry of summary disposition for High Pointe on the noneconomic-damages claim.
Legal Principles
-
For negligent injury to property, Michigan’s common-law measure of damages is economic and is generally limited to:
- diminution in market value for permanent or irreparable injury; or
- reasonable cost of repair (or replacement) when repair is feasible and does not exceed the property’s value.
-
Michigan law does not recognize noneconomic damages (including emotional distress and mental anguish) as a component of recovery for negligent destruction of property absent an accompanying personal injury.
-
A judicial expansion of recoverable damages for property torts to include noneconomic loss is a policy change reserved to the Legislature, not the courts.
Conclusion
The Michigan Supreme Court held that negligent destruction of property supports recovery of economic damages measured by repair/replacement cost or diminution in value, but not noneconomic damages for emotional distress where the plaintiff’s loss consists solely of property damage.