Michigan Supreme Court Overrules Champion v Nationwide Security in Hamed v Wayne County Holding that Employers are not Liable for the Unforeseeable, Intentional Criminal Acts of their Employees Under the Michigan Civil Rights Act

In a case I briefed and argued in January, Hamed v Wayne Countythe Michigan Supreme Court issued a decision on July 29, 2011, reversing a published Court of Appeals decision and overruling the 1996 Supreme Court opinion in Champion v Nationwide Security Inc, 450 Mich 702 (1996).  That case held that an employer was strictly liable for the intentional, criminal acts of his employee under Michigan’s Civil Rights Act.

In Hamed, the Court held that the prevailing common-law rule that an employer was not liable for the intentional and unforeseeable criminal acts of his employee was not abrogated by the Civil Rights Act.  The Michigan Constitution, Art. 3, § 7 provides that the common law remains in force unless and until affirmatively modified.  Despite the fact that the 1996 Champion decision had incorporated a judicial exception to this common-law rule in cases alleging discrimination under Michigan’s Civil Rights Act, there was no language in that statute abrogating the common law.  Subsequent cases had also explicitly rejected this exception, but not in the context of claims alleged under the Civil Rights Act.

Here, the Court ruled that the common-law rule prevails – employers cannot be held strictly liable for the unforeseeable intentional, tortious acts of their employees.  The Court adhered to the principle that an employer must have been put on notice of the specific propensities of an employee to commit the act complained of prior to the incident.  This ruling preserves the traditional tort-law element of foreseeability.

This case will have major impact on businesses, employers and governmental entities in addressing future litigation.

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