• Contracts (2)
• Criminal Law (5)
• Employment & Labor Law (1)
• Family Law (1)
• Intellectual Property (1)
• Litigation (3)
• Negligence & Intentional Tort (1)
• Real Property (2)
• Tax (2)
• Termination of Parental Rights (1)

Contracts

 

This summary also appears under Real Property

 

Issues: Whether the trial court properly granted plaintiff summary disposition finding that the transfer of the disputed property was not in writing and thus any reconveyance to the defendant-Covert Resort Association (CRA) was unenforceable under the statute of frauds (MCL 566.106 and 108); Kloian v. Dominos's Pizza, LLC; Walsh v. Taylor; Michalski v. Bar-Levav; In re Rudell Estate; Lakeside Oakland Dev., LC v. H & J Beef Co.; Zurcher v. Herveat; Whether part performance removed the agreement from the statute of frauds; Dumas v. Auto Club Ins. Ass'n; Giordano v. Markovitz; White v. Walper; Hazime v. Martin Oil of IN, Inc. (ED MI)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Harkness v. Brickman

e-Journal Number: 53387

Judge(s): Per Curiam - Wilder, O'Connell, and K.F. Kelly

 

Given the application of the statute of frauds, the court concluded that there was no genuine issue of material fact and the plaintiff was entitled to judgment as a matter of law. Thus, the court did not address the trial court's additional grounds for summary disposition - no valid contract for want of consideration and meeting of the minds. For many years, the CRA has owned a plot of land consisting of many individual lots. The CRA functioned similarly to a condo association in that it issued its original shareholders or "founding families" certificates of ownership for the various lots. Plaintiff's mother, JK, was a descendant of one of these founding families, and until the early 1990's owned many of the lots. In about 1992, JK and her husband, EK, along with OV, acting on behalf of the founding families, conveyed their collective interest in a large number of the lots to the CRA for $1,700 per lot. The conveyance was memorialized in a vendor's affidavit. The K's still retained several lots after the 1992 conveyance. Some years later, pursuant to an oral agreement, the Ks conveyed their remaining lots to the CRA. As a result of this conveyance, the CRA assumed tax payments for the property and the Ks no longer paid dues to the CRA. There was no written memorialization of this agreement. EK contended that the oral agreement included a term allowing JK or EK or their heirs to regain ownership of the property at a future date by reimbursing the CRA for the tax payments that the CRA made on the property while in possession. JK died some years after the conveyance of the property and in 2008, EK assigned his interest in the property to plaintiff. EK died shortly thereafter. Plaintiff wanted to reimburse the CRA for its tax payments and regain the property. The CRA refused the request, contending that the oral agreement never included any provision where the Ks or their heirs could regain the property. Plaintiff sued defendants for specific performance, seeking the enforcement of the agreement. Defendants moved for summary disposition, arguing in part that the agreement was not in writing and thus, any reconveyance provision was unenforceable under the statute of frauds. The trial court granted plaintiff summary disposition, finding that the transfer of the property to the CRA was void for failure to comply with the statute of frauds, invalid consideration, and no meeting of the minds. A contract for the sale of land must be "in writing" and "be signed by the seller or someone lawfully authorized by the seller in writing." It was undisputed that the Ks attempted to transfer an interest in land to the CRA pursuant to an oral agreement without anything in writing. Thus, under the statute of frauds, the transfer of the property to the CRA was void. The CRA benefitted from possession of the property and payment of the taxes enabled them to continue to enjoy possession. It did not pay a purchase price and the record did not indicate that it made any substantial improvements to the property. Also, plaintiff's complaint sought to reimburse the defendants for the tax payments they made. Under the facts, the court concluded that the application of the statute of frauds was warranted "because defendants' part performance was not so prejudicial to justify removing the oral contract from the statute of frauds." Affirmed.

 

This summary also appears under Litigation

 

Issues: Action for breach of contract and attorney fees arising from a lease agreement; Jurisdiction; MCR 7.203(A)(1); MCR 7.202(6)(a)(i) and (iv); MCR 7.204(A); Allied Elec. Supply Co. v. Tenaglia; Whether the attorney fees order was the "first" "final order"; Motion for summary disposition motion as to damages; Contract interpretation; Coates v. Bastian Bros., Inc.; General rule that a tenant is not liable for costs involving any improvement or upgrade of the property from its prior condition; Cleland v. Clark; Applicability of MCR 2.602(B)(3); Exclusion of evidence related to insurance; MRE 411; Waiver; People v. Carter; Bonkowski v. Allstate Ins. Co.; Exclusion of evidence of alleged prior agreement as to damages; MRE 103(a)(2); Exclusion of an affidavit; MRE 801(c); MRE 804(a); Sackett v. Atyeo; MRE 804(b)(7); Claims of instructional error; MCR 2.512(C); Heaton v. Benton Constr. Co.; "Plain error" review; McNeel v. Farm Bureau Gen. Ins. Co. of MI; "Measure of damages"; "Depreciation"; "Mitigation"; Rasheed v. Chrysler Corp.; M Civ JI 53.05; "Betterment"; Murdock v. Higgins; "Lost rent"; Alleged attorney misconduct; Hilgendorf v. St. John Hosp. & Med Ctr. Corp.; Badiee v. Brighton Area Schs.; "Good-faith" efforts to admit evidence; People v. Noble; MRE 401; Gilbert v. DaimlerChrysler Corp.; Instruction that the attorneys' comments were not evidence; Tobin v. Providence Hosp.; Motion for JNOV, new trial, or "additur"; Smith v. Foerster-Bolser Constr.; Harrigan v. Ford Motor Co.; Hill v. Sacka; Motion for reconsideration; MCR 2.119(F)(3); Contractual attorney fees; The "last antecedent rule"; Attorney fee sanctions; MCL 600.2591; MCR 2.114(E); Defendants' reliance on New Hampshire Ins. Group v. Labombard; MCL 600.2956; Contesting the cause of the fire; Attempt to assert a "comparative negligence" defense; Nelson v. Northwestern Sav. & Loan Ass'n; Interest under the lease or under MCL 500.2006(4); MCR 2.403(O)(11)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Laurel Woods Apts. v. Roumayah

e-Journal Number: 53434

Judge(s): Per Curiam – Wilder, Gleicher, and Boonstra

 

While it was "an extremely close call," the court concluded that the attorney fees order was the "first" "final order" under MCR 7.202(6)(a)(i) and thus, it had jurisdiction to consider all of the plaintiff-landlord's issues on appeal. However, the court rejected plaintiff's claims on appeal and affirmed the final judgment awarding plaintiff $13,086 against the defendants-tenants. Plaintiff sued defendants for breach of contract and attorney fees, alleging that the parties' lease obligated defendants to compensate plaintiff for restoration costs after a fire that was caused by the negligence of one of the defendants. The court held that the trial court did not err in denying plaintiff's motion for summary disposition on the issue of damages because plaintiff did not show that there was no genuine issue of material fact. The court concluded that "there were questions of fact concerning whether all of plaintiff's claimed expenses were for 'damage . . . caused by [defendants'] acts or omissions,' and whether the claimed expenses were actually incurred." The court also rejected plaintiff's claims of evidentiary error, concluding, inter alia, that the trial court did not err in excluding the affidavit of plaintiff's contractor, G, as to the cost of repairing and restoring the property after the fire. While plaintiff argued that the affidavit was admissible under MRE 804(b)(7), the court held that G's affidavit did not meet the criteria in subparts (B) and (C). The court also rejected plaintiff's claims of instructional error, holding, inter alia, that the "trial court's instructions fairly and adequately instructed the jury that defendants were liable for the costs that plaintiff incurred to return the property to its pre-fire condition." As to plaintiff's claims of misconduct by defense counsel during the trial, the court held that defense counsel's efforts to admit evidence of the pre-fire costs of certain items did not constitute misconduct. Further, defense counsel's isolated remarks that "plaintiff should be punished for misrepresenting evidence, and his comparison of plaintiff to a greedy child throwing a temper tantrum" were "mild in comparison to the attorney's remarks in Gilbert." The court also noted that the trial court instructed the jury that the attorneys' comments are not evidence. The trial court's "instruction was sufficient to cure any prejudice and protect plaintiff's rights." The court also held that the trial court did not err in denying plaintiff's post-trial motion for JNOV, a new trial, or additur, or in denying its motion for reconsideration. The court also upheld the trial court's decision to deny plaintiff's requests for attorney fees and costs, holding that ¶ 20(b) of the lease did not authorize an award of attorney fees in this case, and the trial court did not err in denying sanctions because there was no indication "that a primary purpose in asserting any defense was to harass, embarrass, or injure plaintiff." The interest provision of ¶ 20(b) of the lease also did not apply, nor did MCL 500.2006(4). The court also held that the trial court did not err in granting defendants' motion for reconsideration of its decision denying them case evaluation sanctions. Since its initial decision was based on its erroneous belief that it had discretion to deny sanctions under MCR 2.403(O)(11), it properly granted defendants' motion for reconsideration because it had been misled by a "palpable error."

 

Criminal Law

 

Issues: Claims related to the defendant's first-degree premeditated murder conviction; Whether he was denied the right to present a defense including psychiatric testimony defendant claimed was related to his claim of "self-defense"; People v. McPherson; Holmes v. South Carolina; People v. McFall; People v. Dupree; People v. Doss; The Self-Defense Act (MCL 780.971 et seq.); Whether the trial court prevented defendant from presenting a defense by excluding evidence of PPOs against the victim and the victim's MySpace page; MRE 404a(2); People v. Harris; MRE 405; Whether the trial court's voir dire was deficient; People v. Tyburski; Prosecutorial misconduct; People v. Schutte; People v. Noble; People v. Marji; Ineffective assistance of counsel; People v. Pickens; People v. LaVearn; People v. Gaydosh; CJI2d 7.21; Sufficiency of the evidence the victim was killed during the commission or attempt to commit a larceny to convict defendant of felony-murder; People v. Brannon; People v. Petrella; People v. Gillis; People v. Moorer; People v. Williams; Whether defendant was denied the right to a public trial; Presley v. Georgia; People v. Vaughn; Levine v. United States; "Waiver"; Miller v. Alabama

Court: Michigan Supreme Court

Case Name: People v. Orlewicz

e-Journal Number: 53642

Judge(s): Young, Jr., Cavanagh, M. Kelly, Markman, Hathaway, M.B. Kelly, and Zahra

 

In an order in lieu of granting leave to appeal, the court remanded the case (see e-Journal # 49012 in the 6/16/11 edition for the Court of Appeals published opinion) to the trial court for consideration of the defendant's argument under Miller. The court had previously held the application for leave to appeal in abeyance pending its decision in Vaughn, which was decided on 7/9/12. The court denied leave to appeal in all other respects because it was not persuaded that it should review the remaining questions presented.

 

Issues: Whether the trial court properly quashed the information and dismissed the charge after finding that the police lacked justification to detain defendant, the seizure of the heroin was illegal, evidence of it had to be suppressed, and there was no probable cause to bind her over; People v. Hudson; People v. Babcock; MCL 766.13; People v. Waltonen; "Pretext" for the vehicle stop; People v. Hansey; People v. Champion; People v. Labelle

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. Johnson

e-Journal Number: 53408

Judge(s): Per Curiam - Sawyer, Saad, and Meter

 

The court held that the police observed two separate traffic violations, either of which was sufficient to detain defendant, and once the traffic stop occurred, they could seize evidence in plain view without a warrant. Thus, the trial court erred in quashing the information based on a finding that the police lacked a basis to stop her car and seize the heroin in plain view. Defendant was bound over for trial on a charge of possessing a controlled substance (heroin). At a preliminary hearing in the district court, the sole witness was the arresting officer, who testified that while parked around the corner from a known drug-dealing location, he and his partner observed what appeared to be a hand-to-hand drug transaction, after which defendant quickly got into her car and drove away without signaling or putting on her seatbelt. The officers pulled defendant over based on suspicion of drug possession and for failing to use a turn signal and wear a seatbelt. When defendant was reaching in her purse for her license, the officer observed what appeared to be heroin in three knotted plastic baggies and arrested her. The trial court quashed the information and dismissed the charge after determining that the police lacked justification to detain defendant, that the seizure of the heroin was illegal, and evidence of it had to be suppressed, and there was no probable cause to bind her over. Defendant argued to the trial court that the police lacked a reason to stop her vehicle and the stop was pretextual. The trial court agreed. The officer testified that he witnesses two separate traffic violations. Either one of the suspected traffic violations was sufficient to detain defendant because they created a reasonable suspicion that she violated MCL 257.648(1) and MCL 257.7103(3). Further, the fact that the police may have suspected her possession of drugs did not negate their ability to detain her based on the traffic violations. Once the traffic stop occurred, the police could seize evidence in plain view without a warrant. The court reversed and remanded for further proceedings. After the court issued this opinion, it ordered that the opinion was amended to correct a clerical error. In all other respects, the original opinion remained unchanged.

 

Issues: Sufficiency of the evidence to support the defendant's assaulting, resisting, and obstructing an officer convictions; People v. Ericksen; People v. Johnson; "Obstruct" defined (MCL 750.81d(7)(a)); Weighing the testimony and the witnesses' credibility; Whether the verdicts were against the "great weight of the evidence"; People v. Unger; Conflicting testimony; People v. Lacalamita; People v. Lemmon; "Plain error" review; People v. Carines

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. Naval

e-Journal Number: 53461

Judge(s): Per Curiam – O’Connell, Cavanagh, and Donofrio

 

Viewing the testimony in a light most favorable to the prosecution, the court held that there was sufficient evidence to allow a rational fact-finder to conclude that the defendant committed two counts of assaulting, obstructing, and resisting a police officer. Further, the court held that the verdicts were not against the great weight of the evidence. Thus, the court affirmed defendant's convictions. The prosecution presented testimony from officers who responded to a report of a disturbance at a nightclub on the night of the incident. The testimony established that at least two officers were in uniform that night, which was sufficient evidence for the jury to determine that defendant knew they were performing their duties. Three officers testified that defendant confronted them on multiple occasions. "Due to the hostile and aggressive crowd, the officers were concerned for their safety and repeatedly asked defendant to retreat. One officer testified that he attempted to deploy his taser at defendant, but it malfunctioned, and defendant moved back into the crowd." Another officer testified that he repeatedly asked defendant to leave, to the point where he told another officer that he should arrest defendant for interfering with an arrest. A third officer testified that "defendant swung at him, and he was forced to use his taser to control defendant while he was in a struggle with another officer." Defendant's sufficiency of the evidence argument was based on "weighing the testimony and credibility of his witnesses more favorably than those of the prosecution." The court will not second guess a jury on those matters. The court noted that defendant's great weight of the evidence argument relied solely on the weight of the conflicting trial testimony. He failed to show that the jury relied on evidence that was not believable or had no probative value. The court held that "a rational jury could have determined that defendant assaulted, resisted, or obstructed police officers. If a rational jury could have convicted defendant, then the evidence does not 'preponderate[] so heavily against the verdict that it would be a miscarriage of justice to allow the verdict to stand.'" Thus, he failed to show a plain error affecting his substantial rights.

 

Issues: Sufficiency of the evidence to establish defendant's identity as one of the gunmen; People v. Wolfe; People v. Nowack; People v. Oliphant; People v. Kern; People v. Davis; People v. Scotts; Ineffective assistance of counsel; People v. Pickens; People v. Hoag; Failure to call alibi witnesses; People v. Seals; People v. Rockey; Failure to call other witnesses; People v. Armstrong; People v. Stewart (On Remand); Failure to object to references to defendant being in prison; MRE 404(b)(1); People v. Crawford; People v. Abraham; Whether defendant's sentence constituted "cruel and unusual punishment"; Moot issue; MCL 769.34(10); People v. Conley; People v. Broden; People v. Terry; People v. St. John; Sentencing; Whether the trial court propery scored 25 points for PRV 1; People v. Bonilla-Machado; People v. Mansour; Assault with intent to commit murder (AWIM)

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. Padilla

e-Journal Number: 53378

Judge(s): Per Curiam - Owens, Talbot, and Wilder

 

In this case where a jury convicted the defendant of AWIM, felon in possession, and felony-firearm, the court held, inter alia, that there was sufficient evidence of his identity as one of the gunmen to support his convictions. His convictions arose from a shooting incident in which AV was ambushed and shot 16 times outside her home. The prosecution's theory of the case was that AV was shot by defendant who was a close friend of her husband, in retaliation for AV's domestic violence report that resulted in her husband's return to prison. AV testified that, during the shooting incident, she recognized defendant from her husband's photographs, which were taken while defendant and her husband were previously in prison. The defense theory was that AV erroneously identified defendant as one of the gunmen. Also, the defense claimed that AV was motivated to falsely accuse defendant because his sister was having an affair with AV's husband. Defendant contended on appeal, among other things, that the evidence was insufficient to establish his identity as one of the gunmen. AV testified that there were two shooters and that one of the gunmen was standing behind a tree while the second gunman was in the bushes. She positively and unequivocally identified defendant as the gunman behind the tree. Although she had never met him in person she explained that he was her husband's good friend and she recognized him from prison photographs from when her husband was in prison. She also testified that the tree was not large, and the lighting was sufficient for her to see him. She said that she also recognized a tattoo on his neck. She observed that his hair was in a ponytail and that he wore a dark hoodie and a baseball cap. She identified defendant to the first police officer on the scene. While in the hospital she also identified defendant to another officer and identified him from a photographic array. She never was confused about who shot her. Thus, viewed in the light most favorable to the prosecution, the evidence was sufficient to show defendant's identity as the shooter behind the tree and there was sufficient evidence of his identity to support his convictions. The court also held that the other issues he raised on appeal had no merit and affirmed.

 

Issues: Ineffective assistance of counsel for failure to object to the alleged improper scoring of OV 19; People v. Toma; People v. Smith; People v. Barbee; People v. Osantowski; People v. Althoff; People v. Callon; People v. Goodin; Scoring of OV 12 at 5 points; People v. Harverson; Whether the trial court addressed the scoring of OV 12 on the record; "Waiver"; People v. Carter; People v. Conley

Court: Michigan Court of Appeals (Unpublished)

Case Name: People v. Wood

e-Journal Number: 53477

Judge(s): Per Curiam - O’Connell, Cavanagh, and Donofrio

 

Holding, inter alia, that defendant did not show that defense counsel's representation fell below an objective standard of reasonableness, the court affirmed his jury conviction of first-degree home invasion. Defendant knocked on the victim's motel room door and, when the victim opened the door, defendant forced his way into the room. After accusing the victim of stealing his friend's tools and refusing to leave, defendant repeatedly punched the victim about the head and, when he finally left, he took the victim's cellphone and car keys. Although charged with first-degree home invasion and unarmed robbery, defendant was not convicted of unarmed robbery. During defendant's sentencing, the trial court asked the prosecutor and defense counsel - "Do either of you have any objections to the guidelines?" Defense counsel responded in the negative. Defendant argued that he was denied the effective assistance of counsel because his trial counsel failed to object to the improper scoring of OV 19 thus, he was entitled to resentencing. Defendant argued that "there was no evidence he either interfered with or even attempted to interfere with the administration of justice." However, his PSIR indicated that he provided false information to a police officer during the officer's investigation of the crime. When questioned by police, defendant insisted that he was in his motel room all night and had no idea what had happened. "Providing false information to a police officer investigating a crime interferes with the administration of justice for the purpose of scoring OV 19." Thus, even if defense counsel had raised a challenge to the scoring of OV 19 at sentencing, the preponderance of the evidence supported the scoring of OV 19 at 10 points. "Defense counsel is not required to make a meritless motion or a futile objection."

 

Employment & Labor Law

 

Issues: Americans with Disabilities Act (ADA); 42 USC § 12112(a); Labor Management Relations Act (LMRA); 29 USC § 185(a)(§ 301); Whether § 301 preempts state rules regarding the meaning of collective bargaining agreements (CBAs); Teamsters v. Lucas Flour Co.; Allis-Chalmers Corp. v. Lueck; Lingle v. Norge Div. of Magic Chef, Inc.; DelCostello v. International Bhd. of Teamsters; Compatibility of federal laws; Valinski v. Detroit Edison; Saridakis v. United Airlines (9th Cir.); Proctor v. United Parcel Serv. (10th Cir.); Right to be free from disability discrimination arising under the ADA; O'Shea v. Detroit News; Atchison, Topeka & Santa Fe Ry. Co. v. Buell; Railway Labor Act mandatory arbitration provisions; Brown v. Illinois Cent. R.R. Co. (7th Cir.); Schiltz v. Burlington N. R.R. (8th Cir.); Crayton v. Long Island R.R. (ED NY); Caldwell v. Norfolk S. Corp. (WD NC); ADA vs. LMRA; Martin v. Lake Cnty. Sewer Co.

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Watts v. UPS

e-Journal Number: 53431

Judge(s): White, Sutton, and Griffin

 

The court held that the district court erred in granting defendant-UPS judgment as a matter of law because § 301 of the LMRA does not preempt a claim brought in federal court under the ADA. Plaintiff sued defendant, her employer, under the ADA. The district court granted defendant judgment as a matter of law on the grounds that plaintiff's claim was preempted by § 301 of the LMRA, and was untimely under the six-month statute of limitations. On appeal, the court rejected defendant's argument that plaintiff's ADA claim was preempted by § 301 because it involved interpretation of the CBA, and that § 301's six-month statute of limitations barred plaintiff's claim, thus necessitating the dismissal of her suit. It concluded that defendant's argument failed to appreciate the purpose and origins of the preemption doctrine, and that in any event, plaintiff's ADA claim did not require interpretation of the CBA. The court noted that because plaintiff's claim was based on a federal cause of action and was in federal court, there was no danger of divergent application of a CBA's provisions by state courts and thus, the motivating purpose of § 301 preemption simply did not apply. Further, the court found that plaintiff was not pursuing a contractually based claim under the CBA, but rather an independent statutory claim under the ADA. It explained that although defendant may rely on the CBA in defense of that claim, plaintiff's claim itself did not depend on the CBA. Reversed and remanded for a new trial.

 

Family Law

 

Issues: Divorce; Custody; Whether the trial court applied the legal standard for a motion to change custody rather than the standard applicable to an initial custody determination; Parent v. Parent; Vodvarka v. Grasmeyer; MCL 722.27(1)(c); Thompson v. Thompson; The Uniform Child Custody Jurisdiction and Enforcement Act (the Act) (MCL 722.1101 et seq.); Nash v. Salter; Altman v. Nelson; Established custodial environment (ECE)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Albright v. MacDonald

e-Journal Number: 53463

Judge(s): Per Curiam – Markey, Shapiro, and Ronayne Krause

 

Holding that the trial court erred by applying the "proper cause" or "change of circumstances" standard to plaintiff-father's custody action where no valid prior custody order existed, the court reversed and remanded the trial court's order granting the primary physical custody of the parties' minor son to the defendant-mother and denying plaintiff's motion for reconsideration. The parties were married in 2003. After returning from active duty in the Army, plaintiff found work in Utah. Defendant remained in Michigan with the parties' minor son. Plaintiff filed for divorce in Utah, and a judgment was entered in that state in 2006. The parties exercised parenting time pursuant to the Utah order until 2010, when plaintiff moved to change custody. Defendant filed a response questioning the Utah court's jurisdiction over the child. The Utah court entered an order that its custody order was void ab initio because Utah was not the child's home state. Then, plaintiff filed this original custody action in Michigan. Evidentiary hearings were held before a FOC referee. At the close of the hearings, the referee determined that there existed no valid custody order and that there was an ECE with defendant. In 2011, the trial court found that there was an ECE with defendant's having primary care and custody of the child while he was in school and plaintiff's having custody during portions of the summer. Plaintiff moved the trial court for a new trial, reconsideration, or other relief. The trial court found that an ECE existed with defendant and that there was no basis to reconsider its custody order entered after the initial de novo hearing. Plaintiff claimed that the trial court erred in applying the legal standard for a motion to change custody rather than the standard applicable to an initial custody determination. The trial court ruled that "plaintiff was required to demonstrate proper cause or change of circumstances and distinguished Thompson on the basis that it involved a situation where an individual obtained a temporary custody order and had attempted to use that to impose the higher burden on the other party of showing both proper cause or change of circumstances and clear and convincing evidence regarding in the best interests of the child." The trial court found that "plaintiff had failed to show proper cause or change of circumstances necessary to change" the ECE. It was undisputed that as part of the 2006 judgment of divorce, a Utah court issued an order of custody and parenting time as to the child that the parties complied with for approximately three years. But the Utah court determined that it lacked jurisdiction over the child custody proceeding because Michigan was the child's home state pursuant to the Act. Thus, the determination as to which burden of proof to apply rested on whether the Utah order had any effect. The court held that since the Utah court ruled its order as to the child was void ab initio because it lacked subject matter jurisdiction over the child, the custody and parenting time provisions of the Utah judgment were null and void from the first moment of its entry. As a result, when plaintiff filed this custody action in Michigan no "previous judgment[] or order[]" as to the child existed that would require plaintiff to show "proper cause" or "change of circumstances" under MCL 722.22(1)(c). Reversed and remanded.

 

Intellectual Property

 

This summary also appears under Litigation

 

Issues: Whether a previous case involving plaintiff litigated the issues raised in this case; Georgia-Pac. v. Myers Supply, Inc. (Unpub. WD AR); Georgia-Pac. Consumer Prods. LP v. Myers Supply, Inc. (8th Cir.); Issue preclusion; Gargallo v. Merrill Lynch, Pierce, Fenner & Smith, Inc.; Cobbins v. Tennessee Dep't of Transp.; N.A.A.C.P., Detroit Branch v. Detroit Police Officers Ass'n; "Identity of issues;" National Satellite Sports, Inc. v. Eliadis, Inc.; Randles v. Gregart; Hazzard v. Weinberger (SD NY); Mutuality; McAdoo v. Dallas Corp.; Intent; Audi AG v. D'Amato; "Materially changed conditions;" Auto Acetylene Light Co. v. Prest-O-Lite Co.; Likelihood of confusion; General Motors Corp. v. Keystone Auto. Indus., Inc.; Tumblebus Inc. v. Cranmer; Daddy's Junky Music Stores, Inc. v. Big Daddy's Family Music Ctr.; AMF Inc. v. Sleekcraft Boats (9th Cir.); Davis v. Walt Disney Co. (8th Cir.); SquirtCo v. SevenUp Co. (8th Cir.); Duluth News-Tribune v. Mesabi Publ'g Co. (8th Cir.); Inconsistent rulings; Georgia-Pac. Consumer Prods. LP v. von Drehle Corp. (ED NC); Montana v. United States

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Georgia-Pacific Consumer Prods., LP v. Four-U-Packaging, Inc.

e-Journal Number: 53474

Judge(s): Siler, Cook, and Steeh

 

The court held that the district court properly granted defendant's motion for summary judgment because all the elements for issue preclusion were met, and applying it to bar plaintiff's claim did not pose a risk of inconsistent decisions. Plaintiff sued defendant alleging that defendant's supply of off-brand paper towels for use in plaintiff's paper-towel dispensers infringed on its trademarks. Defendant moved for summary judgment, arguing that the claims were barred by the ruling in a similar case brought by plaintiff in Arkansas against a different distributor of generic paper towels. The district court granted defendant's motion. On appeal, the court rejected plaintiff's argument that distinctions between the circumstances of the present case and the previous case in which plaintiff was involved barred the use of issue preclusion. It found that the defendants had similar intent, that the issue of geographic location did not factor in, and that changed circumstances did not preclude the application of the doctrine. The court explained that less than one year passed between the filings of this case and the previous one, and plaintiff's argument that the facts changed so dramatically within this short period of time was unpersuasive. Thus, the court concluded, "the factual differences in defendants, surveys, geographic regions, and mark recognition" were not sufficient to bar application of issue preclusion in this case. The court also rejected plaintiff's argument that the law applicable in this case was distinct from the law applied in the previous case, noting that although the two tests used by the court and by the Eighth Circuit Court of Appeals in the previous case to determine likelihood of confusion were enumerated differently, "their substance is largely identical." The court explained that both tests "consider the strength of the plaintiff's mark, the similarity of the marks, the evidence of actual confusion, the degree of purchaser care, the defendant's intent, and the relatedness (or competition) between the goods." Only two factors from the court's test were unique from those of the Eighth Circuit - the marketing channels used and the likelihood of expansion of the product lines. Assuming that defendant and plaintiff used identical marketing channels, the court concluded that the similarity was unlikely to prove that market confusion existed. Also, the expansion of product lines did not significantly increase the likelihood of confusion. The court further determined that application of issue preclusion in this case posed no risk of creating inconsistent rulings. Affirmed.

 

Litigation

 

This summary also appears under Intellectual Property

 

Issues: Whether a previous case involving plaintiff litigated the issues raised in this case; Georgia-Pac. v. Myers Supply, Inc. (Unpub. WD AR); Georgia-Pac. Consumer Prods. LP v. Myers Supply, Inc. (8th Cir.); Issue preclusion; Gargallo v. Merrill Lynch, Pierce, Fenner & Smith, Inc.; Cobbins v. Tennessee Dep't of Transp.; N.A.A.C.P., Detroit Branch v. Detroit Police Officers Ass'n; "Identity of issues;" National Satellite Sports, Inc. v. Eliadis, Inc.; Randles v. Gregart; Hazzard v. Weinberger (SD NY); Mutuality; McAdoo v. Dallas Corp.; Intent; Audi AG v. D'Amato; "Materially changed conditions;" Auto Acetylene Light Co. v. Prest-O-Lite Co.; Likelihood of confusion; General Motors Corp. v. Keystone Auto. Indus., Inc.; Tumblebus Inc. v. Cranmer; Daddy's Junky Music Stores, Inc. v. Big Daddy's Family Music Ctr.; AMF Inc. v. Sleekcraft Boats (9th Cir.); Davis v. Walt Disney Co. (8th Cir.); SquirtCo v. SevenUp Co. (8th Cir.); Duluth News-Tribune v. Mesabi Publ'g Co. (8th Cir.); Inconsistent rulings; Georgia-Pac. Consumer Prods. LP v. von Drehle Corp. (ED NC); Montana v. United States

Court: U.S. Court of Appeals Sixth Circuit

Case Name: Georgia-Pacific Consumer Prods., LP v. Four-U-Packaging, Inc.

e-Journal Number: 53474

Judge(s): Siler, Cook, and Steeh

 

The court held that the district court properly granted defendant's motion for summary judgment because all the elements for issue preclusion were met, and applying it to bar plaintiff's claim did not pose a risk of inconsistent decisions. Plaintiff sued defendant alleging that defendant's supply of off-brand paper towels for use in plaintiff's paper-towel dispensers infringed on its trademarks. Defendant moved for summary judgment, arguing that the claims were barred by the ruling in a similar case brought by plaintiff in Arkansas against a different distributor of generic paper towels. The district court granted defendant's motion. On appeal, the court rejected plaintiff's argument that distinctions between the circumstances of the present case and the previous case in which plaintiff was involved barred the use of issue preclusion. It found that the defendants had similar intent, that the issue of geographic location did not factor in, and that changed circumstances did not preclude the application of the doctrine. The court explained that less than one year passed between the filings of this case and the previous one, and plaintiff's argument that the facts changed so dramatically within this short period of time was unpersuasive. Thus, the court concluded, "the factual differences in defendants, surveys, geographic regions, and mark recognition" were not sufficient to bar application of issue preclusion in this case. The court also rejected plaintiff's argument that the law applicable in this case was distinct from the law applied in the previous case, noting that although the two tests used by the court and by the Eighth Circuit Court of Appeals in the previous case to determine likelihood of confusion were enumerated differently, "their substance is largely identical." The court explained that both tests "consider the strength of the plaintiff's mark, the similarity of the marks, the evidence of actual confusion, the degree of purchaser care, the defendant's intent, and the relatedness (or competition) between the goods." Only two factors from the court's test were unique from those of the Eighth Circuit - the marketing channels used and the likelihood of expansion of the product lines. Assuming that defendant and plaintiff used identical marketing channels, the court concluded that the similarity was unlikely to prove that market confusion existed. Also, the expansion of product lines did not significantly increase the likelihood of confusion. The court further determined that application of issue preclusion in this case posed no risk of creating inconsistent rulings. Affirmed.

 

This summary also appears under Contracts

 

Issues: Action for breach of contract and attorney fees arising from a lease agreement; Jurisdiction; MCR 7.203(A)(1); MCR 7.202(6)(a)(i) and (iv); MCR 7.204(A); Allied Elec. Supply Co. v. Tenaglia; Whether the attorney fees order was the "first" "final order"; Motion for summary disposition motion as to damages; Contract interpretation; Coates v. Bastian Bros., Inc.; General rule that a tenant is not liable for costs involving any improvement or upgrade of the property from its prior condition; Cleland v. Clark; Applicability of MCR 2.602(B)(3); Exclusion of evidence related to insurance; MRE 411; Waiver; People v. Carter; Bonkowski v. Allstate Ins. Co.; Exclusion of evidence of alleged prior agreement as to damages; MRE 103(a)(2); Exclusion of an affidavit; MRE 801(c); MRE 804(a); Sackett v. Atyeo; MRE 804(b)(7); Claims of instructional error; MCR 2.512(C); Heaton v. Benton Constr. Co.; "Plain error" review; McNeel v. Farm Bureau Gen. Ins. Co. of MI; "Measure of damages"; "Depreciation"; "Mitigation"; Rasheed v. Chrysler Corp.; M Civ JI 53.05; "Betterment"; Murdock v. Higgins; "Lost rent"; Alleged attorney misconduct; Hilgendorf v. St. John Hosp. & Med Ctr. Corp.; Badiee v. Brighton Area Schs.; "Good-faith" efforts to admit evidence; People v. Noble; MRE 401; Gilbert v. DaimlerChrysler Corp.; Instruction that the attorneys' comments were not evidence; Tobin v. Providence Hosp.; Motion for JNOV, new trial, or "additur"; Smith v. Foerster-Bolser Constr.; Harrigan v. Ford Motor Co.; Hill v. Sacka; Motion for reconsideration; MCR 2.119(F)(3); Contractual attorney fees; The "last antecedent rule"; Attorney fee sanctions; MCL 600.2591; MCR 2.114(E); Defendants' reliance on New Hampshire Ins. Group v. Labombard; MCL 600.2956; Contesting the cause of the fire; Attempt to assert a "comparative negligence" defense; Nelson v. Northwestern Sav. & Loan Ass'n; Interest under the lease or under MCL 500.2006(4); MCR 2.403(O)(11)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Laurel Woods Apts. v. Roumayah

e-Journal Number: 53434

Judge(s): Per Curiam – Wilder, Gleicher, and Boonstra

 

While it was "an extremely close call," the court concluded that the attorney fees order was the "first" "final order" under MCR 7.202(6)(a)(i) and thus, it had jurisdiction to consider all of the plaintiff-landlord's issues on appeal. However, the court rejected plaintiff's claims on appeal and affirmed the final judgment awarding plaintiff $13,086 against the defendants-tenants. Plaintiff sued defendants for breach of contract and attorney fees, alleging that the parties' lease obligated defendants to compensate plaintiff for restoration costs after a fire that was caused by the negligence of one of the defendants. The court held that the trial court did not err in denying plaintiff's motion for summary disposition on the issue of damages because plaintiff did not show that there was no genuine issue of material fact. The court concluded that "there were questions of fact concerning whether all of plaintiff's claimed expenses were for 'damage . . . caused by [defendants'] acts or omissions,' and whether the claimed expenses were actually incurred." The court also rejected plaintiff's claims of evidentiary error, concluding, inter alia, that the trial court did not err in excluding the affidavit of plaintiff's contractor, G, as to the cost of repairing and restoring the property after the fire. While plaintiff argued that the affidavit was admissible under MRE 804(b)(7), the court held that G's affidavit did not meet the criteria in subparts (B) and (C). The court also rejected plaintiff's claims of instructional error, holding, inter alia, that the "trial court's instructions fairly and adequately instructed the jury that defendants were liable for the costs that plaintiff incurred to return the property to its pre-fire condition." As to plaintiff's claims of misconduct by defense counsel during the trial, the court held that defense counsel's efforts to admit evidence of the pre-fire costs of certain items did not constitute misconduct. Further, defense counsel's isolated remarks that "plaintiff should be punished for misrepresenting evidence, and his comparison of plaintiff to a greedy child throwing a temper tantrum" were "mild in comparison to the attorney's remarks in Gilbert." The court also noted that the trial court instructed the jury that the attorneys' comments are not evidence. The trial court's "instruction was sufficient to cure any prejudice and protect plaintiff's rights." The court also held that the trial court did not err in denying plaintiff's post-trial motion for JNOV, a new trial, or additur, or in denying its motion for reconsideration. The court also upheld the trial court's decision to deny plaintiff's requests for attorney fees and costs, holding that ¶ 20(b) of the lease did not authorize an award of attorney fees in this case, and the trial court did not err in denying sanctions because there was no indication "that a primary purpose in asserting any defense was to harass, embarrass, or injure plaintiff." The interest provision of ¶ 20(b) of the lease also did not apply, nor did MCL 500.2006(4). The court also held that the trial court did not err in granting defendants' motion for reconsideration of its decision denying them case evaluation sanctions. Since its initial decision was based on its erroneous belief that it had discretion to deny sanctions under MCR 2.403(O)(11), it properly granted defendants' motion for reconsideration because it had been misled by a "palpable error."

 

This summary also appears under Real Property

 

Issues: Whether the trial court properly refused to permit intervenors-2400 Science Parkway, L.L.C. and Speckin to intervene in the related "misrepresentation" case after the plaintiff-receiver disposed of it; Whether the trial court properly denied Speckin and 2400's intervention motion "without explanation"; Vestevich v. West Bloomfield Twp.; Maldonado v. Ford Motor Co.; MCR 2.209; Whether Speckin and 2400 were entitled to intervene in the misrepresentation action to preserve their ability to prosecute it; Prudential Ins. Co. of Am. v. Oak Park Sch. Dist.; Davenport v. Grosse Pointe Farms Bd. of Zoning Appeals; Dean v. Department of Corr.

Court: Michigan Court of Appeals (Unpublished)

Case Name: Simon v. 2400 Science Parkway, L.L.C.

e-Journal Number: 53481

Judge(s): Per Curiam – Gleicher and Ronayne Krause; Concurring in the result only - Saad

 

Concluding, inter alia, that because the intervention motion was not heard until after the intervenor-2400 Science Parkway's cause of action was sold, the court held that the trial court acted within its discretion in denying it. The case arose from a real estate transaction where the buyer, 2400 Science Parkway, defaulted on its mortgage with Huntington Bank. The default placed a guarantor, intervenor-Speckin, on the hook for the mortgage indebtedness. 2400 sued the seller of the property, defendant-Mercantile Bank Mortgage, claiming it had overpaid based on Mercantile's material misrepresentations. In one courtroom, 2400 pursued its misrepresentation claims against Mercantile. In a separate action, Huntington sued Speckin and 2400 seeking to recoup its mortgage investment in the property. A receiver (the plaintiff) assumed control of 2400's misrepresentation action and sold it at auction. The narrow issue before the court was whether the trial court abused its discretion when it refused to permit 2400 and Speckin to intervene in the misrepresentation case after the receiver disposed of it. The court held that a motion to intervene must be timely. Speckin and 2400 asserted that the trial court erred by denying their intervention motion "without explanation." The court stated that although the basis for the trial court's decision to deny intervention could have been stated more clearly, the court detected no error. Speckin and 2400 failed to bring their intervention motion before the trial court until after the cause of action was sold. The trial judge specifically noted that the intervention request could have been heard earlier. The trial court further observed that the sale of the cause of action "was going forward long before last week," and denied the motion. The court noted that a fuller legal explanation for this ruling might have been useful. However, the court held that it clearly understood the trial judge to have determined that the intervention motion hearing came too late, and discerned no basis to disturb this ruling on the ground that it lacked adequate explanation. While Speckin and 2400 also argued that they were entitled to intervene in the misrepresentation action in order to preserve their ability to prosecute it, the court concluded that the trial court did not abuse its discretion in finding that the intervention motion was untimely. Affirmed.

 

Negligence & Intentional Tort

 

Issues: Premises liability; Slip on the icy floor of a walk-in freezer unit of a grocery business; Whether the trial court erred when it found that defendant neither possessed nor controlled the freezer unit; Dancey v. Travelers Prop. Cas. Co.; West v. General Motors Corp.; Kubczak v. Chemical Bank & Trust Co.; Derbabian v. S & C Snowplowing, Inc.; Whether defendant had control over the freezer roof; Brausch v. Brausch; Whether the building lease created a question of fact as to possession and control of the freezer unit roof; Whether defendant failed to preserve the freezer unit and the roof as evidence and that defendant should have been precluded from introducing evidence as to possession and control of the freezer unit and the roof; Brenner v. Kolk

Court: Michigan Court of Appeals (Unpublished)

Case Name: Klenow v. Nehco Co.

e-Journal Number: 53466

Judge(s): Per Curiam - O’Connell, Cavanagh, and Donofrio

 

The court held, inter alia, that the record showed that the defendant neither possessed nor controlled the freezer unit and that plaintiff provided no evidence to indicate that defendant was responsible for preserving, maintaining, or controlling the freezer unit or the freezer unit roof. Plaintiff's action arose after he slipped on the icy floor of a walk-in freezer unit of the grocery business where he was employed as the meat manager. The unit was a prefabricated structure. A prior owner had connected the unit to the grocery building. Plaintiff alleged that the icy floor was the result of a dangerously defective roof that had been added to the unit. Plaintiff sued defendant, who owned the grocery building and leased the building to plaintiff's employer. Plaintiff alleged that defendant breached a duty to maintain the unit and the unit roof in a safe condition. The parties agreed that plaintiff was at the grocery store as an invitee. The record showed that defendant neither possessed nor controlled the freezer unit. The prior owners of the grocery business testified that the grocery business owner possessed and controlled the unit. Defendant's principal attested that the unit and the roof were not its property, but were instead the property of the grocery business owners. Also, the unit was listed as business equipment on the inventory of items the prior grocery business owners sold to plaintiff's employer. Plaintiff argued however, that the cause of his injuries was the condition of the freezer unit roof and that defendant had control over the roof. Plaintiff further argued that the trial court orally ruled at the first summary disposition hearing that the unit and its roof were appurtenances. The trial court's oral statement was not a definitive ruling on the possession and control issue, for two reasons. First, the trial court made no written ruling on the issue until after the second summary disposition hearing. Second, even if the trial court's statement could be deemed a finding that the unit was an appurtenance to the building, the finding would not resolve the possession and control issue. In its written opinion after the second summary disposition hearing, the trial court expressly found that "the evidence indicates that plaintiff's employer . . . had possession and control of the premises during the relevant time period." The court held that the trial court properly denied plaintiff's motion for summary disposition and granted the defendant's similar motion. Affirmed.

 

Real Property

 

This summary also appears under Contracts

 

Issues: Whether the trial court properly granted plaintiff summary disposition finding that the transfer of the disputed property was not in writing and thus any reconveyance to the defendant-Covert Resort Association (CRA) was unenforceable under the statute of frauds (MCL 566.106 and 108); Kloian v. Dominos's Pizza, LLC; Walsh v. Taylor; Michalski v. Bar-Levav; In re Rudell Estate; Lakeside Oakland Dev., LC v. H & J Beef Co.; Zurcher v. Herveat; Whether part performance removed the agreement from the statute of frauds; Dumas v. Auto Club Ins. Ass'n; Giordano v. Markovitz; White v. Walper; Hazime v. Martin Oil of IN, Inc. (ED MI)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Harkness v. Brickman

e-Journal Number: 53387

Judge(s): Per Curiam - Wilder, O'Connell, and K.F. Kelly

 

Given the application of the statute of frauds, the court concluded that there was no genuine issue of material fact and the plaintiff was entitled to judgment as a matter of law. Thus, the court did not address the trial court's additional grounds for summary disposition - no valid contract for want of consideration and meeting of the minds. For many years, the CRA has owned a plot of land consisting of many individual lots. The CRA functioned similarly to a condo association in that it issued its original shareholders or "founding families" certificates of ownership for the various lots. Plaintiff's mother, JK, was a descendant of one of these founding families, and until the early 1990's owned many of the lots. In about 1992, JK and her husband, EK, along with OV, acting on behalf of the founding families, conveyed their collective interest in a large number of the lots to the CRA for $1,700 per lot. The conveyance was memorialized in a vendor's affidavit. The K's still retained several lots after the 1992 conveyance. Some years later, pursuant to an oral agreement, the Ks conveyed their remaining lots to the CRA. As a result of this conveyance, the CRA assumed tax payments for the property and the Ks no longer paid dues to the CRA. There was no written memorialization of this agreement. EK contended that the oral agreement included a term allowing JK or EK or their heirs to regain ownership of the property at a future date by reimbursing the CRA for the tax payments that the CRA made on the property while in possession. JK died some years after the conveyance of the property and in 2008, EK assigned his interest in the property to plaintiff. EK died shortly thereafter. Plaintiff wanted to reimburse the CRA for its tax payments and regain the property. The CRA refused the request, contending that the oral agreement never included any provision where the Ks or their heirs could regain the property. Plaintiff sued defendants for specific performance, seeking the enforcement of the agreement. Defendants moved for summary disposition, arguing in part that the agreement was not in writing and thus, any reconveyance provision was unenforceable under the statute of frauds. The trial court granted plaintiff summary disposition, finding that the transfer of the property to the CRA was void for failure to comply with the statute of frauds, invalid consideration, and no meeting of the minds. A contract for the sale of land must be "in writing" and "be signed by the seller or someone lawfully authorized by the seller in writing." It was undisputed that the Ks attempted to transfer an interest in land to the CRA pursuant to an oral agreement without anything in writing. Thus, under the statute of frauds, the transfer of the property to the CRA was void. The CRA benefitted from possession of the property and payment of the taxes enabled them to continue to enjoy possession. It did not pay a purchase price and the record did not indicate that it made any substantial improvements to the property. Also, plaintiff's complaint sought to reimburse the defendants for the tax payments they made. Under the facts, the court concluded that the application of the statute of frauds was warranted "because defendants' part performance was not so prejudicial to justify removing the oral contract from the statute of frauds." Affirmed.

 

This summary also appears under Litigation

 

Issues: Whether the trial court properly refused to permit intervenors-2400 Science Parkway, L.L.C. and Speckin to intervene in the related "misrepresentation" case after the plaintiff-receiver disposed of it; Whether the trial court properly denied Speckin and 2400's intervention motion "without explanation"; Vestevich v. West Bloomfield Twp.; Maldonado v. Ford Motor Co.; MCR 2.209; Whether Speckin and 2400 were entitled to intervene in the misrepresentation action to preserve their ability to prosecute it; Prudential Ins. Co. of Am. v. Oak Park Sch. Dist.; Davenport v. Grosse Pointe Farms Bd. of Zoning Appeals; Dean v. Department of Corr.

Court: Michigan Court of Appeals (Unpublished)

Case Name: Simon v. 2400 Science Parkway, L.L.C.

e-Journal Number: 53481

Judge(s): Per Curiam – Gleicher and Ronayne Krause; Concurring in the result only - Saad

 

Concluding, inter alia, that because the intervention motion was not heard until after the intervenor-2400 Science Parkway's cause of action was sold, the court held that the trial court acted within its discretion in denying it. The case arose from a real estate transaction where the buyer, 2400 Science Parkway, defaulted on its mortgage with Huntington Bank. The default placed a guarantor, intervenor-Speckin, on the hook for the mortgage indebtedness. 2400 sued the seller of the property, defendant-Mercantile Bank Mortgage, claiming it had overpaid based on Mercantile's material misrepresentations. In one courtroom, 2400 pursued its misrepresentation claims against Mercantile. In a separate action, Huntington sued Speckin and 2400 seeking to recoup its mortgage investment in the property. A receiver (the plaintiff) assumed control of 2400's misrepresentation action and sold it at auction. The narrow issue before the court was whether the trial court abused its discretion when it refused to permit 2400 and Speckin to intervene in the misrepresentation case after the receiver disposed of it. The court held that a motion to intervene must be timely. Speckin and 2400 asserted that the trial court erred by denying their intervention motion "without explanation." The court stated that although the basis for the trial court's decision to deny intervention could have been stated more clearly, the court detected no error. Speckin and 2400 failed to bring their intervention motion before the trial court until after the cause of action was sold. The trial judge specifically noted that the intervention request could have been heard earlier. The trial court further observed that the sale of the cause of action "was going forward long before last week," and denied the motion. The court noted that a fuller legal explanation for this ruling might have been useful. However, the court held that it clearly understood the trial judge to have determined that the intervention motion hearing came too late, and discerned no basis to disturb this ruling on the ground that it lacked adequate explanation. While Speckin and 2400 also argued that they were entitled to intervene in the misrepresentation action in order to preserve their ability to prosecute it, the court concluded that the trial court did not abuse its discretion in finding that the intervention motion was untimely. Affirmed.

 

Tax

 

Issues: Whether "energy optimization charges" are subject to sales tax under the General Sales Tax Act (GSTA)(MCL 205.51 et seq.); Ameritech Publ'g, Inc. v. Department of Treasury; The Clean, Renewable & Efficient Energy Act (MCL 460.1001 et seq.); MCL 460.1071(1) and (2); MCL 460.1089(1) and (2); Whether the trial court properly applied the "incidental to services" test; Catalina Mktg. Sales Corp. v. Department of Treasury; MCL 205.51(1)(d) (defining "sales price"); Correct result reached for the wrong reason; Dybata v. Wayne Cnty.; Energy optimization (EO)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Midwest Energy Coop. v. Department of Treasury

e-Journal Number: 53458

Judge(s): Per Curiam – O’Connell, Cavanagh, and Donofrio

 

The court held that while the trial court erred in applying the Catalina factors in this case, it correctly determined that EO charges are subject to sales tax under the GSTA. The court concluded that the EO charge is properly categorized under MCL 205.51(1)(d)(iii) as a "[c]harge[] by the seller for any services necessary to complete the sale[.]" Thus, the court affirmed the trial court's order denying the plaintiff's summary disposition motion and granting the defendant summary disposition. Plaintiff was a "regulated electric cooperative" that sells electricity to residential and commercial customers. In accordance with 2008 PA 295, plaintiff implemented an EO plan and assessed an EO charge on its customer's billing statements to cover the costs of the EO plan. Plaintiff paid sales taxes on its retail sales of electricity as required by law. During the time period at issue, plaintiff also paid, under protest, sales taxes on the EO charges. Plaintiff sued defendant seeking a refund of $10,434.20, the full amount that it paid under protest. The trial court determined that the EO charges were subject to sales tax because the EO plan was an "incidental service" to the retail sale of electricity. Plaintiff argued on appeal that the trial court erroneously applied the "incidental to services" test set forth in Catalina, and the court agreed, concluding that the Catalina factors did not apply. The issue here was whether the EO charge was incidental to the sale of electricity, or tangible personal property. "Simply put, the Catalina factors pertain to the concept of 'incidental to service,' not 'incidental to tangible personal property.'" However, the court noted that pursuant to MCL 205.52(1), the sales tax applies to the "gross proceeds" of a business. MCL 205.51(1)(c) defines "[g]ross proceeds" as "sales price." MCL 205.51(1)(d) defines "[s]ales price" to include "Charges by the seller for any services necessary to complete the sale." The court noted that the "EO plan is a service that an electricity retailer must provide a customer to engage in sales of electricity." Further, pursuant to MCL 460.1089(1) "an energy provider shall be allowed to recover its actual costs of implementing its EO plan. Thus, the EO plan is a 'service[] necessary to complete the sale,'" and the "EO charge is part of the 'sales price' of electricity and is subject to sales tax as 'gross proceeds' of the sale of electricity."

 

Issues: Whether a non-party (the lessor Gallagher) was responsible for the use tax rather than plaintiff-Musashi (the lessee); The Use Tax Act (UTA); "Use"; MCL 205.92(b); MCL 205.93(1); MCL 205.94(1)(a); MCL 205.95(4); Statutory interpretation; Driver v. Naini; Pohutski v. City of Allen Park; Krohn v. Home-Owners Ins. Co.; Rule 82 of the Michigan Administrative Code (Mich Admin Code R 205.132); Guardian Indus. Corp. v. Department of Treasury; Devonair Enters., LLC v. Department of Treasury; "Shall"; Old Kent Bank v. Kal Kustom, Enters.

Court: Michigan Court of Appeals (Unpublished)

Case Name: Musashi Auto Parts of MI, Inc. v. Department of Treasury

e-Journal Number: 53482

Judge(s): Per Curiam – Talbot and Riordan; Concurring in the result - Wilder

 

The court held that "the obligation to pay the use tax falls upon the lessor only." Here, plaintiff-Musashi, the lessee, was not responsible for payment under the UTA for uniforms leased from the lessor, Gallagher. Thus, the court held that summary disposition was properly granted to Musashi because there was no genuine issue of material fact as to Musashi's liability under the UTA. The facts of the case were undisputed. Musashi is a Michigan corporation that manufactures automotive parts in Michigan. Musashi employees wear uniforms rented from Gallagher Uniform Rental Company. The rental contract between Gallagher and Musashi did not mention who was responsible for the payment of use taxes and stated that Musashi "shall defend, hold harmless, and indemnify Gallagher from any and all liability and costs of whatever nature, including attorneys fees, arising from any claim by a third party and arising from or relating to the services and items supplied by Gallagher to [Musashi]." When Gallagher sent the invoice for the uniforms to Musashi, there was no charge for use tax. The defendant-Department conducted an audit of Musashi for the taxable period of 1/5/05 through 8/31/08. The Department assessed a use tax deficiency of $121,648, approximately $86,000 of which was for the uniform rentals from Gallagher. Musashi paid the tax and filed a complaint, arguing that as lessor, Gallagher was responsible for the use tax, not Musashi. "The UTA specifically references the obligation of a lessor to pay the use tax." MCL 205.95(4) states that "[a] lessor may elect to pay use tax on receipts from the rental or lease of the tangible personal property in lieu of payment of sales or use tax on the full cost of the property at the time it is acquired." Also, the Michigan Administrative Code considers the application MCL 205.95(4). In 1972, the Department promulgated Rule 82, which states - "[a] person engaged in the business of renting or leasing tangible personal property to others shall pay the Michigan sales or use tax at the time he purchases tangible personal property, or he may report and pay use tax on the rental receipts from the rental thereof." The court recently determined that "Rule 82 is consistent with the statutory language of MCL 205.95(4)" and that "'Rule 82 ... neither imposes additional requirements, nor limits or modifies the application of MCL 205.95(4)'" and is not in conflict with the statute. Thus, as the word "shall" designates a mandatory provision, "pursuant to Rule 82, promulgated in accordance with MCL 205.95(4), lessors are obligated to pay the use tax, without any type of corresponding responsibility belonging to lessees." Affirmed.

 

Termination of Parental Rights

 

Issues: Termination of parental rights pursuant to §§ 19b(3)(b)(ii), (g), (j), and (k)(iii); In re HRC; In re Fried; Best interests of the children; In re Trejo Minors; In re JK

Court: Michigan Court of Appeals (Unpublished)

Case Name: In re Cook

e-Journal Number: 53468

Judge(s): Per Curiam - Talbot, Markey, and Riordan

 

The court held that the trial court properly terminated the respondent-mother's parental rights to her minor children where the statutory grounds for termination were established by clear and convincing evidence and the termination was in the best interests of the children. The events that led to the termination of respondent's parental rights began in 2008 in Texas. The CPS in Texas became involved after the father (DM) of the two younger children severely beat one of the children. Respondent did not report the beating and did not seek medical treatment for the injured child. Because of this incident, she was ordered not to have any contact with DM. However, she continued to live with him and the CPS drafted an affidavit to remove the children from the home in 2010. The family moved to Michigan. The petitioner-DHS received complaints that DM physically abused respondent and the minor children. He was arrested on child abuse charges in Michigan in 10/10, and was extradited to Texas as to the child abuse charges there. In 2/11, respondent was arrested and extradited to Texas because she had an outstanding warrant for her arrest in that state. She pleaded guilty to injury to a child by omission in Texas and was sentenced to six months in jail. On 3/23/11, DHS filed a second amended petition and sought termination of both parents' parental right at the initial dispositional hearing. Respondent did not return to Michigan after her release from jail in Texas, and had not seen her children since 1/11. DHS provided her with various services and she partially complied, but failed to obtain employment and there was no indication that she followed up on a psychological evaluation or counseling. When a parent fails to participate in services, she cannot complain that they were not offered. The trial court did not clearly err in finding that the grounds for termination were established and termination was in the best interests of the children. She continued to protect DM from allegations of abuse and refused to report the abuse. There was likelihood that the children would be harmed if returned to her. The children indicated that they were afraid of her and did not want to be returned to her care. Affirmed.

 

Classifieds

Announcement
Association Desired
Employment AvailableNEW!
Employment Wanted
Event/Seminar
For Sale
Office Space
Public Notice
Referrals
Advertising Marketplace

Fields of Practice

Adoption
ADR
Appellate Practice
Arbitration & Mediation
Attorney Discipline
Business Law
Commercial Litigation
Copyrights
Divorce
Family Law
Federal False Claims
Health Care
Immigration
Intellectual Property
Law Enforcement
Legal Malpractice
Lemon Law
Licensing
Medicare Liens
Patents
Personal Injury
Stockbrokers
Taxation
Trademarks

Disclaimer