Spelman v. Addison

The two questions presented by this appeal are: 1. Should the trial judge's order denying plaintiffs' motion for discovery be affirmed? 2. Should the trial judge's order granting defendants' motion to dismiss plaintiffs' bill of complaint be affirmed?

Justice SHARPE has written for affirmance of each of these orders. On the ground that the record before us does not disclose that the denial of plaintiffs' motion for discovery was an abuse of the discretion vested in the trial court, I concur in affirmance of the order entered. But I am unable to agree in affirmance of the order dismissing plaintiffs' bill of complaint.

Fundamentally the dismissal of the bill of complaint by the trial court was on the ground that the allegations were largely conclusions of the pleaders and did not allege sufficient facts or circumstances, even taken as true, to constitute a cause of action against defendants or any of them. The contents of the bill of complaint are fairly and quite fully stated in the opinion of Justice SHARPE; though it should also be added that plaintiffs specifically allege the following:

"Plaintiffs further state that all of the facts concerning the operations of all of the defendant corporations over a period of the last 12 years are in the exclusive possession of and under the control of the defendants; that it is necessary in order to prosecute this suit and prepare pleadings and prepare for trial, that discovery be had and that the defendants and their records be examined and that depositions be taken."

In recent years, at least, this Court has taken a liberal attitude in passing upon sufficiency of pleadings. On the law side of the court it is provided: "The declaration shall contain such specific allegations as will reasonably inform the defendant of the nature of the cause he is called upon to defend." Court Rule No. 19, § 1 (1933). As to pleadings generally it is provided by rule: "All pleadings must contain a plain and concise statement without repetition of the facts on which the pleader relies in stating his cause of action or defense, and no others." Court Rule No. 17, § 1 (1933). In the instant case plaintiffs' claimed right to relief is based upon alleged fraud and misconduct of defendants. Plaintiffs' suit is planted on the equity side of the court because they seek an accounting and injunctive relief. In a case of similar character wherein the bill of complaint was dismissed in the circuit court on the application of defendants, we reversed the order of dismissal and said:

"The facts upon which the claim of fraud is based must be alleged, rather than conclusions, but it is sufficient if the substance of the transaction and the result is alleged." Watson v. Wagner (syllabus), 202 Mich. 397.

In determining the sufficiency of a bill of complaint, consideration should be given to the character of the plaintiff's alleged cause of action and to such circumstances as whether the records and knowledge of the facts on which the plaintiff relies are in his possession or largely, if not exclusively, in the possession of defendant. In the instant case there can be no question but that in a very large measure the defendants, and not the plaintiffs, are the ones possessed of knowledge of detailed facts and circumstances upon which the merits of plaintiffs' case must depend. As noted above the case is so pronouncedly of that character that plaintiffs allege in their bill of complaint their inability to plead fully all the facts, and their need of discovery.

With the contents of the bill of complaint in the instant case such as are stated in the opinion of Justice SHARPE, and as they appear in the record, defendants should have been required to answer; and the trial court was in error in entering an order dismissing the bill of complaint. The case is remanded to the trial court for the purpose of vacating the order of dismissal and for further proceedings therein. Since neither party fully prevailed on this appeal no costs will be awarded in this court.

BOYLES, STARR, WIEST, BUTZEL, and BUSHNELL, JJ., concurred with NORTH, J. CHANDLER, C.J., did not sit.