"Contract immunity" defense rejected
In Maday v. Harold Miller Real Estate, the Defendant claimed it should not have to pay the verdict against it because its negligence arose out of a contractual relationship with the Plaintiff. The Court of Appeals rejected this claim as an over-statement of the contractual immunity theory created by the Engler Majority of the Michigan Supreme Court. Under the latter rationale, a party who contracts to act is relieved of any responsibility outside the contract--even the responsibility to act "reasonably". In rejecting the Defendant's argument, the Court noted that when the Engler majority created the suggestion that a contract duty eliminates any duty arising out of negligence, it expressly limited that ruling to claims made by third-parties to the contract. The Maday court was not willing to expand what commentators have called "contractual immunity."
The underlying Supreme Court case, Fultz v. Union-Commerce Association, has been roundly criticized by commentators, victims' attorneys, and insurance attorneys alike, as contrary to sound reasoning and sound public policy. Making a promise to one other person to perform a contractual undertaking should not relieve any actor of the duty to act reasonably: assuming an "extra" duty by contract should not relieve people of their inherent duty to comply with the standard of reasonable care.