PER CURIAM.
Plaintiff appeals as of right from a final judgment entered in his favor in this breach of contract action, which granted him summary disposition on three counts of his amended complaint and awarded him damages. Specifically, plaintiff's claims on appeal result from the trial court's order granting summary disposition in part, denying summary disposition on Count X of his amended complaint, relating to statutory stealing under MCL 600.2919a(1), and the denial of plaintiff's motion for partial reconsideration.
On appeal, plaintiff argues that the trial court erred in dismissing his statutory stealing claim by redefining it sua sponte as a claim for conversion rather than stealing. He contends he was entitled to summary disposition on the statutory stealing claim, and the attendant treble damages, because defendant, James Katz (Katz) and Auto Source Wholesale, LLC (Auto Source) (collectively, "defendants"), engaged in willful misconduct by absconding with $250,000 belonging to him.
We reverse and remand for entry of an order granting plaintiff summary disposition on his statutory stealing claim, and for a determination by the trial court regarding an award of treble damages.
Plaintiff agreed to loan defendants $250,000, who purportedly were experiencing "cash flow" issues, and who had told plaintiff that their used car dealership could "secure financing from Next Gear Capital to purchase vehicles that we have to pay for before Next Gear reimburses us." To acquire the $250,000 from plaintiff, Katz told him that he would guarantee the "loan" with funds from the Katz Trust, which was set up by his grandmother, and to which Katz claimed he was the beneficiary. In response to plaintiff's request that Katz and his father personally guarantee the repayment of the loan, Katz fraudulently claimed there was a balance of $471,789.41 in the trust and that those funds were available to repay plaintiff's $250,000. In reality, the balance of the Katz Trust was 13 cents. When it came time for repayment, defendants failed to do so. Rather, Katz used much of plaintiff's $250,000 for personal expenses and to repay other Auto Source, LLC debts. Plaintiff eventually filed this action, alleging, among other things, breach of contract, common law fraud, and statutory stealing under MCL 600.2919a.
This Court reviews a motion for summary disposition de novo. Gorman v American Honda Motor Co, Inc, 302 Mich.App. 113, 115; 839 N.W.2d 223 (2013). We review only the evidence that was presented at the time the trial court made its decision on the motion. Id. at 120. A motion for summary disposition under MCR 2.116(C)(10) challenges the factual sufficiency of a plaintiff's claim. Id. at 115. The trial court considers the evidence in the light most favorable to the nonmoving party. Id. Summary disposition is proper under MCR 2.116(C)(10) if "`there is no genuine issue regarding any material fact and the moving party is entitled to judgment as a matter of law.'" Id. at 116 (citation omitted). There is a genuine issue of material fact "`when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue upon which reasonable minds might differ.'" Id. (citation omitted). Additionally, this Court reviews questions of statutory interpretation de novo. Aroma Wines & Equip, Inc v Columbian Distrib Servs, Inc, 497 Mich. 337, 345; 871 N.W.2d 136 (2015) (Aroma Wines II).
Originally, MCL 600.2919a did not provide a remedy against the individual who stole, embezzled, or converted property. Aroma Wines II, 497 Mich at 354. Then, in 2005, the statute was amended to create a cause of action against the individual wrongdoer. Id. at 339. Now, the current version of MCL 600.2919a(1) provides:
Plaintiff's claim for statutory stealing is not part of his original four-count complaint. Plaintiff later added a claim pursuant to MCL 600.2919a in an amended complaint, which clearly set forth a claim for statutory stealing and not a claim for statutory conversion. Plaintiff alleged as follows (emphasis added):
Plaintiff's motion for summary disposition asserted a claim for statutory stealing pursuant to MCL 600.2919a and plaintiff argued he was entitled to summary disposition because Katz's fraudulent misrepresentations and forgeries constituted an illegal taking of property with the intent to unlawfully keep it, as well as a taking by false pretenses. Plaintiff is correct that that the trial court erred in treating his claim for statutory stealing as one for statutory conversion because those theories are two separate and distinct causes of action pursuant to the statute.
Plaintiff never made a claim for statutory conversion. Defendants' response to plaintiff's motion for summary disposition set forth the requirements to prevail on a statutory conversion claim, but then asserted that plaintiff was not entitled to summary disposition because a question of fact remained regarding whether plaintiff was the real owner of the "allegedly stolen funds." As plaintiff never brought a statutory conversion cause of action, it is unclear why the trial court sua sponte converted this case into one by adopting the defendants' conversion analysis.
This Court follows the rules of statutory construction, and must discern and give effect to the Legislature's intent. Aroma Wines II, 497 Mich at 345. "The language of the statute is the most reliable evidence of that intent, and we enforce the clear and unambiguous language of the statute as written." Id. Effect must be given to every phrase, clause, and word in a statute so that no word is treated as surplusage or rendered nugatory. Id. MCL 600.2919a(1)(a) provides that a person may recover damages, costs, and attorney fees as the result of "[a]nother person's stealing or embezzling property or converting property to the other person's own use." MCL 600.2919a(1)(a) (emphasis added). "In general, `or' is a disjunctive term, indicating a choice between two alternatives[.]" Paris Meadows, LLC v City of Kentwood, 287 Mich.App. 136, 148; 783 N.W.2d 133 (2010). Legislators are presumed to know the rules of grammar, and statutes are to be read within their grammatical context, unless a contrary intent is otherwise expressed. Richards v Richards, 310 Mich.App. 683, 700-701; 874 N.W.2d 704 (2015). Thus, MCL 600.2919a(1)(a) should be read as providing a basis for recovery when another person steals, or embezzles, or converts another person's property. Paris Meadows, 287 Mich App at 148. Any of the three alternatives are sufficient to recover. Id. In analyzing the statutory language of "converting property to the other person's own use," the Michigan Supreme Court noted,
Additionally, this Court has treated claims for embezzlement under this statute as a claim separate from one for stealing or conversion. See generally New Props, Inc v George D Newpower, Jr, Inc, 282 Mich.App. 120; 762 N.W.2d 178 (2009).
The trial court relied on Lawsuit Fin, LLC v Curry, 261 Mich.App. 579, 593; 683 N.W.2d 233 (2004), quoting Hovanesian v Nam, 213 Mich.App. 231, 237; 539 N.W.2d 557 (1995), for the proposition that "simply retaining money does not amount to `buying, receiving or aiding in the concealment of stolen, embezzled or converted property.'" Lawsuit Fin specifically dealt with a statutory conversion claim. Lawsuit Fin, 261 Mich App at 592-593. It was decided prior to the 2005 change of the language in the statute. In support of its conclusion, the trial court cited language from the pre-2005 statute, which did not include a cause of action against the individual wrongdoer. Aroma Wines II, 497 Mich at 339. Conversely, plaintiff's claim here is pursuant to the post-2005 statutory language of MCL 600.2919a and the claim is for statutory stealing rather than statutory conversion as the trial court ruled.
We further agree with plaintiff that he was entitled to summary disposition on his statutory stealing claim. MCL 600.2919a does not define "stealing" for purposes of the statute. When interpreting statutory language, this Court must ascertain the legislative intent that may be reasonably inferred from the words expressed in the statute and we may consult dictionary definitions to do so. Alken-Ziegler, Inc v Hague, 283 Mich.App. 99, 102-103; 767 N.W.2d 668 (2009).
In the context of defining a term, Black's Law Dictionary is among the "most useful and authoritative for the English language generally and for law." Scalia & Garner, Reading Law: The Interpretation of Legal Texts (St. Paul: Thomson/West, 2012), pp 419 & 424. The present edition of Black's continues to define "steal" as "[t]o take (personal property) illegally with the intent to keep it unlawfully," or "[t]o take (something) by larceny, embezzlement, or false pretenses." Black's Law Dictionary (10th ed). The defendants' actions fit within this definition of "steal." Plaintiff unwittingly agreed to provide defendants with a $250,000 "loan," and the funds were transferred pursuant to a false promissory note and a fraudulent guaranty. Clearly, defendants had the intent to keep the money unlawfully, or "steal" it, as demonstrated by the evidence that Katz knew that the funds in the Katz Trust were not sufficient to pay plaintiff back $250,000.
In essence, Katz stole plaintiff's money by false pretenses. "False pretenses" is defined as "[t]he crime of knowingly obtaining title to another person's personal property by misrepresenting a fact with the intent to defraud." Black's Law Dictionary (10th ed). The Michigan Penal Code defines "false pretenses" as including, but not limited to:
As the trial court noted in its order when it granted plaintiff summary disposition as to his breach of contract and common law fraud claims, "there can be no doubt [that] [d]efendants provided false and forged documents to [p]laintiff in order to obtain the loan" that they knowingly could not pay back. Thus, there is no genuine issue of material fact that defendants stole $250,000 from plaintiff, and plaintiff was entitled to summary disposition on his statutory stealing claim.
Rather than relying on Black's Law Dictionary as a reference, the dissent reasons that another dictionary should be used to define the word as the appellant did not plead that steal has a unique legal meaning.
The dissent seems to conclude that Katz rightfully took plaintiff's money rather than characterizing his action as a misappropriation for a purpose for which the plaintiff did not give him permission to do. However, the record shows the defendant falsely took plaintiff's money and used it for personal and other expenses unrelated to the "loan" agreement purpose which was to utilize the $250,000 for defendant's used car dealership so that it could "secure financing from Next Gear Capital to purchase vehicles." This was a taking without having permission or the right to do so. Thus, defendants' conduct fits within the dissent's preferred definition of "steal" and amounts to a violation of MCL 600.2919a.
MCL 600.2919a(1) provides that an individual damaged under the statute "may recover [three] times the amount of actual damages sustained, plus costs and reasonable attorney fees." "May" is permissive, and indicates discretionary action. Haring Charter Twp v City of Cadillac, 290 Mich.App. 728, 749; 811 N.W.2d 74 (2010). An award of treble damages is within a court's discretion, and the plaintiff must demonstrate that the trial court's denial of treble damages was outside the range of principled outcomes. Hoffenblum v Hoffenblum, 308 Mich.App. 102, 117; 863 N.W.2d 352 (2014). Treble damages are designed to penalize or punish "dishonest defendants," and set an example for other wrongdoers. Alken-Ziegler, 283 Mich App at 104. Treble damages are punitive in nature. Stevens v Creek, 121 Mich.App. 503, 509; 328 N.W.2d 672 (1982).
Plaintiff requested an award of treble damages in his amended complaint and motion for summary disposition. The trial court did not grant plaintiff treble damages, or even consider them, because it denied plaintiff's motion for summary disposition related to statutory stealing. Thus, on remand, the trial court must consider whether to grant plaintiff treble damages as this Court is unable to grant plaintiff such relief as it only is within the discretion of the trial court, and up to the trier of fact to do so. Aroma Wines & Equip, Inc v Columbian Distrib Servs, Inc, 303 Mich.App. 441, 449-450; 844 N.W.2d 727 (2013) (Aroma Wines I).
Reversed and remanded for an order granting plaintiff summary disposition on his statutory stealing claim, and for a determination regarding an award of treble damages at the trial court's discretion. We do not retain jurisdiction.
O'BRIEN J. (dissenting).
The majority broadly interprets "stealing" in MCL 600.2919a to conclude that a "stealing" claim permits recovery for a taking by false pretenses. In so doing, the majority summarily dismisses basic principles of statutory interpretation to reach a result that runs against the Legislature's clear intent. Because I would not broadly interpret "steal" when used in MCL 600.2919a, I respectfully dissent.
MCL 600.2919a does not define "stealing" for purposes of the statute. When interpreting statutory language, this Court must ascertain the legislative intent that may be reasonably inferred from the words expressed in the statute. Alken-Ziegler, Inc v Hague, 283 Mich.App. 99, 102; 767 N.W.2d 668 (2009). "We must give every word its plain and ordinary meaning, unless otherwise defined, and may rely on dictionary definitions." Johnson v Pastoriza, 491 Mich. 417, 436; 818 N.W.2d 279 (2012).
Plaintiff argues that we should rely on a legal dictionary's definition of "steal," but does not argue that "stealing" as used in MCL 600.2919a(1) has acquired a unique legal meaning.
Random House Webster's College Dictionary (2000) defines "steal" as "to take (the property of another or others) without permission or right, esp. secretly or by force," and "to appropriate . . . without right or acknowledgment."
Although the majority is correct that the canon against surplusage is not an absolute rule, the majority ignores that the canon should be used "`[w]hen possible . . . to avoid constructions that would render any part of the Legislature's work nugatory.'" Pinkney, 501 Mich at 283, quoting People v Seewald, 499 Mich. 111, 123; 879 N.W.2d 237 (2016) (emphasis in Pinkney). In other words, interpreting words in a statute as having "no meaning" and "no substantive effect" "should be regarded as the exception rather than the rule." Scalia & Garner, Reading Law: The Interpretation of Legal Texts (St. Paul: Thomson/West, 2012) p 178.
I see no reason to conclude that this case is exceptional so the rule against surplusage should not apply.
Under Random House's definition of "steal," defendants are only liable to plaintiff if they took plaintiff's property without permission or right. The undisputed evidence established that plaintiff willingly loaned defendants $250,000 and consented to the transfer of that money to defendants. Thus, defendants took plaintiff's property with plaintiff's permission, and the property was never "stolen" under MCL 600.2919a. Although the evidence established that plaintiff loaned defendants the money under false pretenses, I would hold that MCL 600.2919a does not provide a cause of action for false pretenses. As noted by the majority, "false pretenses"—a legal term of art—is "[t]he crime of knowingly obtaining title to another person's personal property by misrepresenting a fact with the intent to defraud." Black's Law Dictionary (10th ed). Once a person obtains title to property, he or she "cannot steal it." People v March, 499 Mich. 389, 405; 886 N.W.2d 396 (2016) ("The first rule is that a person in the rightful possession[
The majority disagrees with this conclusion and states that "defendants' conduct also fits within the dissent's preferred definition of `steal' which amounts to a violation of MCL 600.2919a." The majority seems to believe that it is wrong to conclude that "Katz rightfully took plaintiff's money." But it is unclear why the majority believes this; it is undisputed that plaintiff loaned—and Katz took—the money based on a valid contract, and plaintiff has since collected on that contract. In other words, the money was loaned with plaintiff's permission, and Katz "rightfully" took the loan money. Although Katz lied to induce plaintiff to loan him the money, this does not affect whether the money was given to defendants with plaintiff's permission. If defendants' fraud could somehow be construed as defendants taking plaintiff's property without plaintiff's permission, the crime of false pretenses would have never been created; "false pretenses" would have been considered a type of "unauthorized taking" and fallen under the umbrella of larceny. See LaFave & Scott, Criminal Law (St. Paul: West, 2nd ed, 1986), pp 702-704; see also March, 499 Mich at 407, quoting Metamorphosis of Larceny, 89 Harv L Rev at 475 (explaining that, at common law, "anyone in rightful possession of property[] was endowed with a sort of `possessorial immunity' such that `those who acquired possession over chattels were not subject to criminal liability for subsequent misappropriation'"). Simply put, it is clear that Katz did "rightfully [take] plaintiff's money," regardless of how wrong Katz's intent was in so doing.
Ultimately, we are faced with two definitions of "steal": one that includes a claim for false pretenses and renders the separate claim of "embezzling property" in MCL 600.2919a surplusage, and one that does not include a claim for false pretenses but gives meaning to the entirety of MCL 600.2919a. The Legislature is presumed to be familiar with the rules of statutory construction. Alma Piston Co v Dep't of Treasury, 236 Mich.App. 365, 370; 600 N.W.2d 144, 147 (1999). I would therefore faithfully apply the canon against surplusage and conclude that the proper definition of "steal" as used in MCL 600.2919a is the one that does not render the separate claim of "embezzling property" surplusage. If, as the majority concludes, the Legislature did not intend what it wrote, I would leave that for the Legislature to fix.
Recently, our Supreme Court declined to apply the canon against surplusage, and its reasoning for not doing so was six pages long. See Pinkney, 501 Mich at 282-288. That reasoning was directly related to interpreting the statute at issue. After declining to apply the canon, our Supreme Court drove home that its "finding has historically been—and will continue to be—exceedingly rare" because "[e]very word of a statute should be given meaning and no word should be treated as surplusage or rendered nugatory if at all possible." Pinkney, 501 Mich at 288 (quotation marks and citation omitted; emphasis in Pinkney). Yet rather than justify its "exceedingly rare" finding, the majority simply states, "As the canon of surplusage is not an absolute rule, we decline to adopt the dissent's reasoning."
Moreover, the majority ignores that, when the rule against surplusage is disregarded, it is generally done in favor of adopting a word's ordinary meaning. See Reading Law, p 176 ("Put to a choice, however, a court may well prefer ordinary meaning to an unusual meaning that will avoid surplusage."). Yet the majority disregards the ordinary meaning of the word "steal" and instead adopts the definition from a legal dictionary. Ironically, in Moskal v United States, 498 U.S. 103, 120; 111 S.Ct. 461; 112 L Ed 2d 449 (1990) (SCALIA, J., dissenting), to which the majority cites, Justice SCALIA reasoned that the term "falsely made" should be afforded "its ordinary meaning" rather than a more technical one.
And contrary to the majority's apparent assertion, Justice SCALIA's dissent in Moskal does not support declining to use the canon against surplusage in this case. Justice SCALIA reasoned that the drafters were likely repeating themselves because at least two words in the statute at issue were each defined as synonyms for each other. Id. ("As the United States conceded at oral argument, and as any dictionary will confirm, `forged' and `counterfeited' mean the same thing. See, e.g., Webster's 2d, supra, at 607 (defining to `counterfeit' as to `forge,' and listing `forged' as a synonym of the adjective `counterfeit'), id., at 990 (defining to `forge' as to `counterfeit,' and listing `counterfeit' as a synonym of `forge'). Here, Black's Law Dictionary does not list or define "steal" as a synonym for "embezzlement." In fact, no dictionary that I could find lists "steal" as a synonym for "embezzlement." In my opinion, this suggests that, although "steal" may encompass "embezzlement" when used alone, when "steal" and "embezzlement" are used together they are not intended as synonyms.
It is unclear why the majority believes that defendants' use of the loan funds is an issue. Defendants' use of the funds certainly show that Katz's intent was to defraud plaintiff, but it does not establish that defendants took plaintiff's money without his permission. Obviously, Katz's actions were wrong; he defrauded plaintiff into loaning him money, used the money for personal gain, and refused to repay plaintiff when the loan came due. But none of that is relevant to whether Katz came into possession of plaintiff's money without plaintiff's permission. And because the undisputed facts are that defendants took plaintiff's money with permission, their actions should not constitute "stealing" under MCL 600.2919a.
This aside, the majority's decision as it now stands in opposition to Pratt leads to an odd result: a person that knowingly aids in the concealment of property acquired under false pretenses can be liable for concealing stolen property under MCL 600.2919a(1)(b), but cannot be guilty of concealing stolen property under MCL 750.535(1), despite the statutes' remarkable similarities. Compare MCL 600.2919a(1)(b) (permitting recovery based on "[a]nother person's buying, receiving, possessing, concealing, or aiding in the concealment of stolen, embezzled, or converted property when the person buying, receiving, possessing, concealing, or aiding in the concealment of stolen, embezzled, or converted property knew that the property was stolen, embezzled, or converted") with MCL 750.535(1) ("A person shall not buy, receive, possess, conceal, or aid in the concealment of stolen, embezzled, or converted money, goods, or property knowing, or having reason to know or reason to believe, that the money, goods, or property is stolen, embezzled, or converted.").
