Although the Supreme Court later overruled Pennsylvania R Co's holding that some negligence was required to hold a bailee liable for the loss of property, it continued to recognize that "fires are sometimes spawned by other than negligent conduct." Columbus Jack Corp v Swedish Crucible Steel Corp, 393 Mich 478, 483, 486; 227 NW2d 506 (1975). In cases not relating to bailments, the Supreme Court has held, "We cannot presume negligence merely from the happening of [a] fire."
In Michigan, the case law provides that a bailor can make out a prima facie case of liability against a warehouseman by showing two things: (1) delivery of the goods in good order; and (2) return of the goods in a damaged state. Columbus Jack Corp. v. Swedish Crucible Steel Corp., 393 Mich. 478, 227 N.W.2d 506 (1975). In the instant case, the district court stated that: "[t]he Court finds it somewhat difficult to pinpoint with certainty when the coils were damaged," and actually made no finding as to whether the coils were rusted when they were in Toko's possession or Nicholson's possession or both. The district court, nevertheless, found that Acwoo made out a "prima facie claim of negligence" against Nicholson. If by "negligence" the district court means only a failure to exercise reasonable care by the warehouse, there is evidence in the record to support this finding.
This may require a defendant-bailee to produce evidence of the actual circumstances surrounding the origins of the fire or the theft, including the precautions taken to prevent the loss. Columbus Jack Corp. v. Swedish Crucible Steel Corp., 227 N.W.2d 506, 510-511 (Mich.S.Ct. 1975). As Defendant agrees, the FEMA Guidelines may be used as evidence of negligence, which is part of a bailment claim.
To establish a prima facie case of negligence on behalf of the bailee, the bailor must establish the existence of a bailment and that the property is returned in a damaged condition, thus creating a presumption of negligence. Columbus Jack Corp. v. Swedish Crucible Steel Corp. , 393 Mich. 478, 483-484 (1975). The bailee may rebut that presumption by proving that the bailee exercised due care under the circumstances.
Goldman v. Phantom Freight, Inc., 162 Mich. App. 472, 479-80 (1987). To establish a prima facie case of negligence on behalf of the bailee, the bailor must establish the existence of a bailment and that the property is returned in a damaged condition, thus creating a presumption of negligence. Columbus Jack Corp v. Swedish Crucible Steel Corp, 393 Mich. 478, 483-484 (1975). The bailee may rebut that presumption by proving that the bailee exercised due care under the circumstances.
Second, even if Defendant met or exceeded the Performance Metrics, Defendant's performance could only constitute evidence that Defendant "exercised due care under the circumstances." see Reliance Ins. Co. v. Ingersoll-Rand, 2000 WL 33388436 (Mich.App. 2000) (citing Columbus Jack Corp. v. Swedish Crucible Steel Corp., 393 Mich. 478, 486 (1975)). Defendant's performance would not, however, establish as a matter of law that Defendant delivered Plaintiff-owned goods at issue in this case.
Similar to COGSA, Michigan law "provides that a bailor can make out a prima facie case of liability against a warehouseman by showing two things: (1) delivery of the goods in good order; and (2) return of the goods in a damaged state. Columbus Jack Corp. v. Swedish Crucible Steel Corp., 393 Mich. 478, 227 N.W.2d 506 (1975)." Acwoo, 840 F.2d at 1290.
In summary, we have held that a bailor may create a presumption of negligence by establishing that a bailment existed, that the bailor delivered to the bailee nonperishable bailed goods which would not ordinarily be damaged without negligence, and that the bailee either failed to redeliver the goods or redelivered the goods in a damaged condition. See Lakehead Constructors, Inc. v. Roger Sheehy Co., 304 Minn. 175, 229 N.W.2d 514 (1975); Columbus Jack Corp. v. Swedish Crucible Steel, 393 Mich. 478, 227 N.W.2d 506 (1975); Hawkeye Specialty Co. v. Bendix Corporation, 160 N.W.2d 341 (Iowa 1968); Jones v. O'Bryon, 254 Iowa 31, 116 N.W.2d 461 (1962); Buckey v. Indianhead Truck Line, 234 Minn. 379, 48 N.W.2d 534 (1951); and Allen v. Line, 72 S.D. 392, 34 N.W.2d 835 (1948). After the bailor has established a presumption of negligence against the bailee by credible evidence, the bailee must introduce evidence to rebut the presumption.