What changes in the makeup of the Michigan Supreme Court could mean for businesses Featured

8:00pm EDT October 26, 2010

The upcoming election on Nov. 2 may have a significant impact on the philosophical make-up of the Michigan Supreme Court over the next eight years.

Until the highly contentious race in 2008, judicial races were largely held with little fanfare. With the perceived influence, however, of partisan ads in the 2008 Supreme Court race, this year’s election is worth examining to determine its likely impact on the state of Michigan.

“The results of this election will directly impact the substantive law of Michigan,” says Thomas Azoni, a senior partner with Secrest Wardle. “Ultimately, this may require Michigan businesses to adjust their business model to account for new risks and the potential costs associated with those risks.”

Smart Business spoke with Azoni about the upcoming election and its potential impact on Michigan law.

How important is this year’s judicial election?

The two Supreme Court seats up for grabs are among the most important elections on the ballot in terms of their practical impact on the near-term business climate in Michigan. These seats, particularly with the recent retirement of Justice Elizabeth Weaver, have the potential to swing the court either toward a more liberal or a more conservative majority, not only for the near-term, but for years to come.

However the court is constituted, the result will have a direct impact on Michigan substantive law and how such law will affect Michigan businesses.

The governor’s race always gets the most attention; however, governors deal with a legislative body whose make-up changes every two years. Whether the governor’s political agenda becomes law or not has much to do with the shifting tide of support in the House and Senate chambers. By contrast, the Michigan Supreme Court consists of only seven members; a minimum of four decide matters of real practical significance.

As an example, Michigan has a no-fault automobile statute designed to provide certain benefits to persons involved in auto accidents, regardless of fault. Each auto policy in Michigan provides for statutorily mandated medical expenses, wage loss and household services, regardless of whether the injured person caused the accident.

In return for this universal statewide coverage, the legislature attempted to limit the ability of auto accident victims to sue the at-fault driver for additional compensation in the form of pain and suffering damages.

These accident cases are lucrative for plaintiff attorneys, and they support judicial candidates whom they believe will give an expansive interpretation of the no-fault law.

Since the 2008 election, the change in a single seat on the court resulted in a decision called McCormick v. Carrier, that greatly expanded the ability of accident victims to sue other drivers. Continued expansion of such rights, and into other areas of law, is a distinct possibility if the court maintains its current majority.

How will that affect premiums?

Michigan already ranks second highest in annual auto premiums in the country. The McCormick decision will potentially cause those auto premiums to go even higher unless something is done. Of the surrounding states, Ohio is ranked 49th, Wisconsin 48th and Illinois ninth. If you were choosing a state in which to locate your business, this may very well have an impact on your decision.

Does that make the decision this autumn an easy one for businesspeople?

Not entirely. While the candidates are chosen by the political parties, decisions made by the Michigan Supreme Court do not fall neatly into a liberal/conservative dichotomy. There is no Republican or Democratic view of the law of contracts or real property, after all.

As a general statement, however, the views of Republicans Robert Young and Mary Beth Kelly are generally seen as conservative and more in line with promoting the business interests of Michigan. Conversely, the historic views of Democrats Denise Langford Morris and Alton Davis are generally seen as more liberal and more in line with a greater tolerance for broad rights for purported victims of allegedly tortious conduct.

The decision is never an easy one, but it is one that is left to the electorate. Even though the Supreme Court is to decide issues based on the law and not the will of the majority, as is the case for the legislature and the executive branches, we still elect the court. It is an anomaly that is visited upon us each election cycle.

How can the system for electing Supreme Court justices be changed?

A constitutional convention is required to end the current system and restore some needed sanity to the selection process. As the process of electing judges is defined in the Michigan Constitution, such a change would be required to assure that our justices are on the bench based upon qualifications and not the political process.

While no method is flawless, a gubernatorial selection from a blue-ribbon nominating committee holds the most promise, in my view.

Thomas Azoni is a senior partner with Secrest Wardle. Reach him at (248) 539-2821 or tazoni@secrestwardle.com.