Whether the parties’ agreement provided for mandatory arbitration in this action alleging shareholder oppression; Arbitration as a matter of contract; Altobelli v. Hartmann; Contract interpretation; Beck v. Park W. Galleries, Inc.; Use of the word “may”; Perkovic v. Zurich Am. Ins. Co.; Mill Creek Coal. v. South Branch of Mill Creek Intercounty Drainage Dist.; Distinguishing Mollett v. Taylor; Existence of an arbitration contract & the enforceability of its terms as judicial questions; Huntington Woods v. Ajax Paving Indus., Inc. (After Remand); Strong public policy favoring arbitration as a simple expeditious means of resolving disputes; Rooyakker & Sitz, PLLC v. Plante & Moran, PLLC; Non-binding effect of federal case law when an issue is to be determined by Michigan contract law; Travelers Prop. Cas. Co. of Am. v. Peaker Servs., Inc.; Cases involving collective bargaining agreements; Alarcon v. Fabricon Prods., Div. of Eagle-Picher Co.

In light of the “unique language” of the parties’ dispute resolution agreement, the court held that it did not mandate arbitration and thus, plaintiffs were free to file their shareholder oppression action. It affirmed the trial court’s denial of defendants’ summary disposition motion. Plaintiff-Stephen Skalnek and defendant-Richard Skalnek are brothers and the sole shareholders, officers, and directors of plaintiff-Skalnek Ford. Stephen filed a lawsuit in 2008. While it was pending, the parties entered into the dispute resolution agreement, which named a third party (W) “to assist the Parties in resolving certain disputes in the event” they were unable to agree on important issues. “In 2016, Stephen, individually and derivatively in the name of Skalnek Ford” filed a multi-count complaint against defendants alleging shareholder oppression, among other things, and requesting injunctive and declaratory relief. Defendants unsuccessfully moved for dismissal of the claim and to compel arbitration under the dispute resolution agreement. On appeal, the court held that the trial court correctly ruled that the agreement was discretionary. While defendants relied on ¶ 2, contending it was a mandatory arbitration provision, the court found that it was “questionable whether this provision really constitutes an agreement to arbitrate as it lacks all the terms and structure of an arbitration agreement.” Arbitration was not mentioned until ¶ 6, “the right-to-appeal provision.” The court noted that the use of the word arbitration in ¶ 6 showed that “the parties knew what arbitration was, including the procedure; and could have used the terminology in paragraphs 1-3” had they wished to define W’s “role as that of an arbitrator.” Further, the “use of the word ‘may’ in the context of submission of the dispute to arbitration, and the word ‘must’ for the process of submission of the dispute, strongly supports the view that the arbitration provision is permissive.” However, the court noted that it was “not setting forth a broad rule that ‘may’ in an arbitration agreement is permissive.” While defendants primarily relied on Mollett, that case was readily distinguishable.

Legal malpractice; Res judicata; Sewell v. Clean Cut Mgmt., Inc.; Dart v. Dart; Adair v. State; Allen v. McCurry; Brown v. Felsen; Richards v. Tibaldi; Garrett v. Washington; Whether plaintiff’s failure to file her malpractice claim as a counterclaim to defendants’ prior district court collection action barred her claim; Leslie v. Mollica; Van Pembrook v. Zero Mfg. Co.; Effect of the fact Michigan is a compulsory joinder state; MCR 2.203(A) & (E); Salem Indus., Inc. v. Mooney Process Equip. Co.; Adoption of the transactional test; Goss v. Monroe Auto Equip. Co.; Distinguishing Wayne Cnty. v. Detroit & Sprague v. Buhagiar; Board of Cnty. Rd. Comm’rs for the Cnty. of Eaton v. Schultz; Karp v. Michigan Nat’l Bank (Unpub.)

Holding that plaintiff’s failure to file her legal malpractice claim as a counterclaim to defendants’ district court collection action did not bar her claim under res judicata, the court reversed summary disposition for defendants and remanded. They represented her in post-divorce litigation. She did not answer the complaint in their collection action, and a default and default judgment were entered by the clerk in that case. About a month later, she filed this legal malpractice case. Defendants successfully moved for summary disposition on the basis that the collection suit constituted res judicata “as to all claims arising out of their representation of plaintiff” in the post-divorce litigation. The court found that their argument sought to “apply the transactional test so broadly as to construe the entire course of an attorney-client relationship to be subsumed in the failure of plaintiff to pay a bill.” In light of long-standing case precedent, it declined to do so. In Leslie, “the Supreme Court addressed precisely this question. It held that when a professional, (in Leslie it was a physician), files a collection case against a former client, the client is not required to plead her malpractice claim at that time and may do so later without being barred by” res judicata. The court found that Leslie remains good law, noting that in Van Pembrook, it more recently similarly rejected the claim that res judicata barred a suit due to a plaintiff’s failure to raise claims in defendant’s prior case against plaintiff. The fact that Michigan is a compulsory joinder state does not mean it “is a compulsory counterclaim state.” The court held in Salem that “MCR 2.203(E) ‘is permissive, as opposed to compulsory’ and ‘allows a party the option to maintain its counterclaim in a separate independent action.’” Defendants did not rebut Leslie, Van Pembrook, or Salem, other than to argue that they were “no longer good law because Michigan now applies the transactional test.” However, that test was adopted well before Van Pembrook and Salem were decided, and they cited no case indicating that the Supreme Court “has abandoned the long-standing rule articulated in Leslie.” Further, none of the purposes underlying the doctrine applied here.

Case evaluation sanctions; MCR 2.403(O)(1); Actual costs; MCR 2.403(O)(6)(a) & (b); Great Lakes Gas Transmission Ltd. P’ship v. Markel; Attorney fees; Smith v. Khouri

Concluding that it could not be disputed that defendant-Allstate incurred attorney fees recoverable under MCR 2.403(O), the court reversed the denial of Allstate’s request for case evaluation sanctions in the form of attorney fees, and remanded for the trial court to determine the proper amount of attorney fees to which it was entitled under MCR 2.403(O)(6)(b) and the Smith factors. A case evaluation panel issued a case evaluation of $120,000 in Allstate’s favor against third-party defendant-Odeh, which it accepted and Odeh effectively rejected. Judgment was later entered for Allstate in the amount of $388,643.42, plus $12 in taxable costs and $26,525.40 in interest. It sought $111,090 in attorney fees ($300/hour for 370.3 hours). The court noted that “the trial court’s ruling was not so much a determination that the case generally did not mandate an award of case evaluation sanctions under MCR 2.403, as it was a determination that Allstate simply did not present a properly-supported request for sanctions.” On appeal, Allstate failed to “challenge the trial court’s conclusions that counsel’s biography and the mere allegations in Allstate’s motion did ‘not constitute admissible evidence of an appropriate hourly rate.’” It also did not address the “concerns about the unidentified persons in the bill of costs and the basis justifying a $300 hourly rate for their services.” However, there were “also problematic aspects of the trial court’s ruling. The Economics of Law Practice Survey clearly constituted proper evidence that could be considered in determining the reasonableness of an hourly rate.” Further, “the initials of Allstate’s counsel, with whom the trial court was familiar, dominate the bill of costs,” undermining the “decision not to grant any attorney fees” due to the unidentified persons. The trial court “did not identify what entries in the bill of costs it deemed to be redundant and excessive,” and its “finding that the legal issues and concepts involved in the case were not novel, complex, or difficult certainly cannot serve as a basis to deny an award of attorney fees altogether.”

Dispute over city ordinances regulating sexually oriented businesses; Overbreadth challenge; Principle that an overbreadth challenge is an exception to traditional standing rules; Michigan Up & Out of Poverty Now Coal. v. Michigan; Mootness; B P 7 v. Bureau of State Lottery; Ripeness; City of Huntington Woods v. Detroit; Vagueness; Plymouth Twp. v. Hancock; Principle that the governmental interest in combating the negative secondary effects associated with adult entertainment establishments is unrelated to the suppression of the erotic message conveyed by nude dancing; Erie v. Pap’s A M; Restrictions on how far semi-nude employees must remain from patrons or customers; Sensations, Inc. v. Grand Rapids (6th Cir.); Lady J Lingerie, Inc. v. Jacksonville (11th Cir.); Peek-A-Boo Lounge of Bradenton, Inc. v. Manatee Cnty., FL (11th Cir.); Principle that a person holding a liquor license has a vested property right in the license; Bundo v. Walled Lake; Principle that one does not have a due process right to the continuation of an existing law; Van Buren Twp. v. Garter Belt, Inc.; Review under the standards applicable to content-neutral time, place, & manner regulations; Truckor v. Erie Twp.; Principle that the whims of the real estate market are of no concern; Renton v. Playtime Theatres, Inc.; Expert testimony; MRE 702; Klabunde v. Stanley; “Manual review”; Young v. Nationwide Mut. Ins. Co. (6th Cir.)

The court held that the trial court did not err by granting summary disposition for defendant-city in this case involving constitutional challenges to its licensing and zoning ordinances regulating sexually oriented businesses. On appeal, the court first held that the trial court correctly found that plaintiffs lacked standing to challenge the licensing ordinance beyond their overbreadth argument. It next rejected plaintiffs’ argument that the ordinance’s no-touching provision is overbroad because “an employee might violate the ordinance if he or she regularly appears semi-nude, but while fully clothed, accidentally brushes against” a customer, noting the provision expressly does not prohibit accidental contact. As to their claim that the terms “lewdness” and “public indecency” are impermissibly vague, the ordinance at issue “does not actually prohibit ‘lewdness’ or ‘public indecency’ at all, but rather prohibits specific and defined conduct for a purpose, the arguable vagueness of which is largely irrelevant.” The court further rejected their challenge to the ordinance’s prohibition against nudity and restrictions against “semi-nudity” on First Amendment freedom of expression grounds, noting they failed to show how such restrictions violate the First Amendment. In addition, it rejected their contention that “the ordinance revision that eliminated an exception to the prohibition against alcohol inside sexually oriented businesses deprives them of a protected property interest in their liquor license without due process,” finding they “have not been deprived of that license, but rather from serving liquor under certain circumstances, and they do not have a due process right to the continuation of an existing law.” Finally, the court rejected their argument that the trial court erred in finding that defendant’s zoning ordinance leaves open adequate alternative channels of adult expression. “Given that there is only one entity seeking to operate an adult business in” the city, “and there exist over 100 whole or partial parcels where an adult business could be located, the zoning ordinance clearly does not deny plaintiffs a reasonable opportunity to operate a sexually oriented business in” the city. Affirmed.

Whether the parties’ agreement provided for mandatory arbitration in this action alleging shareholder oppression; Arbitration as a matter of contract; Altobelli v. Hartmann; Contract interpretation; Beck v. Park W. Galleries, Inc.; Use of the word “may”; Perkovic v. Zurich Am. Ins. Co.; Mill Creek Coal. v. South Branch of Mill Creek Intercounty Drainage Dist.; Distinguishing Mollett v. Taylor; Existence of an arbitration contract & the enforceability of its terms as judicial questions; Huntington Woods v. Ajax Paving Indus., Inc. (After Remand); Strong public policy favoring arbitration as a simple expeditious means of resolving disputes; Rooyakker & Sitz, PLLC v. Plante & Moran, PLLC; Non-binding effect of federal case law when an issue is to be determined by Michigan contract law; Travelers Prop. Cas. Co. of Am. v. Peaker Servs., Inc.; Cases involving collective bargaining agreements; Alarcon v. Fabricon Prods., Div. of Eagle-Picher Co.

In light of the “unique language” of the parties’ dispute resolution agreement, the court held that it did not mandate arbitration and thus, plaintiffs were free to file their shareholder oppression action. It affirmed the trial court’s denial of defendants’ summary disposition motion. Plaintiff-Stephen Skalnek and defendant-Richard Skalnek are brothers and the sole shareholders, officers, and directors of plaintiff-Skalnek Ford. Stephen filed a lawsuit in 2008. While it was pending, the parties entered into the dispute resolution agreement, which named a third party (W) “to assist the Parties in resolving certain disputes in the event” they were unable to agree on important issues. “In 2016, Stephen, individually and derivatively in the name of Skalnek Ford” filed a multi-count complaint against defendants alleging shareholder oppression, among other things, and requesting injunctive and declaratory relief. Defendants unsuccessfully moved for dismissal of the claim and to compel arbitration under the dispute resolution agreement. On appeal, the court held that the trial court correctly ruled that the agreement was discretionary. While defendants relied on ¶ 2, contending it was a mandatory arbitration provision, the court found that it was “questionable whether this provision really constitutes an agreement to arbitrate as it lacks all the terms and structure of an arbitration agreement.” Arbitration was not mentioned until ¶ 6, “the right-to-appeal provision.” The court noted that the use of the word arbitration in ¶ 6 showed that “the parties knew what arbitration was, including the procedure; and could have used the terminology in paragraphs 1-3” had they wished to define W’s “role as that of an arbitrator.” Further, the “use of the word ‘may’ in the context of submission of the dispute to arbitration, and the word ‘must’ for the process of submission of the dispute, strongly supports the view that the arbitration provision is permissive.” However, the court noted that it was “not setting forth a broad rule that ‘may’ in an arbitration agreement is permissive.” While defendants primarily relied on Mollett, that case was readily distinguishable.

Contempt; In re Contempt of Henry; In re Contempt of Dudzinski; In re Contempt of Robertson; MCL 600.1701(g); Criminal contempt; In re Contempt of Rochlin; MCL 600.1711(1); MCL 600.1715(1); Porter v. Porter; People v. Kammeraad

Holding that defendant’s 10-minute tardiness for a motion hearing, considered together with his behavior throughout the case, was sufficient to support the trial court’s criminal contempt ruling and the 30-day jail sentence imposed, the court affirmed. The sentence was to be served concurrently with the sentence on his underlying conviction for aggravated domestic violence. His tardiness “was but just one instance of a litany of contemptible acts and insolent behavior” he engaged in during the case. He showed up for a prior hearing at the scheduled time and spoke to his attorney in the hallway, but could not be found when the case was called. When he came into the courtroom, he was talking on his cell phone. His explanation was that his brother called and he stepped out to talk to him and smoke a cigarette. During the hearing at which he pleaded guilty to the underlying charge, he interrupted the trial court over 10 times and was warned “to stop talking or else he would be found in contempt. [He] was repeatedly argumentative, disrespectful, and noncompliant with the trial court’s instructions.” Finally, at the hearing where he was found in contempt, he explained he was late “because a bus was not on time and he was forced to walk. The trial court did not find” him credible, noting he had been late previously. During the hearing, he interrupted his wife’s testimony, and when the trial court was issuing its ruling, he “began making disruptive gestures and was scolded” for doing so. The trial court noted “its belief, based on defendant’s history, that he ‘shows up when he feels like it,’” and indicated that “it had warned defense counsel that defendant would be held in contempt if he was late.” It then held him in contempt, “causing defendant to blare out that he would immediately report the matter to the Judicial Tenure Commission. Defendant’s gamesmanship relative to the criminal justice system was evident.” The court held that there was proof beyond a reasonable doubt that he “engaged in willful acts of disorderly, contemptuous, disrespectful, and insolent behavior, disrupting and disobeying” the trial court process.

Divorce; Criminal contempt for violation of a protective order; In re Contempt of Henry; In re Contempt of Dudzinski; In re Contempt of Robertson; MCL 600.1701(g); In re Contempt of Rochlin; MCL 600.1711(2); MCR 3.606(A); MCL 600.1715(1); Porter v. Porter; Award of attorney fees as part of a contempt sanction; MCL 600.1721; MCR 3.206(C)(2)(b); Richards v. Richards; Taylor v. Currie; Objection to the reasonableness of the amount of awarded attorney fees raised for the first time on appeal; Jansen v. Jansen; Unclean hands; Whether there was a violation of MCR 2.412(C); Failure to file a motion to strike an appellate brief based on its alleged nonconformity; MCR 7.212(I); The trial court’s authority to take judicial notice of the entire record; Snider v. Dunn

The court affirmed the trial court’s order finding the defendant-ex-wife in criminal contempt for violating a protective order and the divorce judgment, concluding that there was sufficient evidence supporting “the contempt ruling and the underlying finding that defendant willfully disobeyed lawful court orders.” The trial court sentenced her to 93 days in jail, imposed a $7,500 fine, and ordered her to pay the plaintiff-ex-husband $15,000 in attorney fees and $2,625 for costs. During the divorce action, a stipulated protective order mutually prohibited the disclosure of “personal or business financial information revealed and shared during” discovery. The divorce judgment provided that neither party would “have any deliberate contacts with the other party’s clients, adversaries, and business associates,” and would not “disparage the other in any communication with the other’s clients, adversaries and business associates.” After the divorce case ended, “defendant filed a request for investigation with the Attorney Grievance Commission as to plaintiff, who is an attorney, alleging numerous unlawful, unethical, or improper financial dealings” by him, “and apparently utilizing some information previously gleaned through discovery. The grievance was dismissed.” Later, plaintiff’s current wife was sued by her former stepson (S) and plaintiff represented her. There was evidence that defendant mailed an envelope to S’s attorney containing “a letter wherein defendant again accused plaintiff of numerous unlawful, unethical, or improper financial dealings.” S’s attorney testified “in the contempt hearing, and a handwriting expert opined that defendant was the author of” the letter. There was “no dispute that this information was extremely disparaging of plaintiff.” Given that she sent S’s “attorney damaging and disparaging information regarding both plaintiff and plaintiff’s current wife, one could reasonably infer that defendant knew that plaintiff was involved in the lawsuit as counsel for his wife.” Further, given that S’s attorney was litigating a claim against plaintiff’s current wife, the attorney could “reasonably be characterized as an adversary of plaintiff” due to the marital relationship alone.

Divorce; Criminal contempt for violation of a protective order; In re Contempt of Henry; In re Contempt of Dudzinski; In re Contempt of Robertson; MCL 600.1701(g); In re Contempt of Rochlin; MCL 600.1711(2); MCR 3.606(A); MCL 600.1715(1); Porter v. Porter; Award of attorney fees as part of a contempt sanction; MCL 600.1721; MCR 3.206(C)(2)(b); Richards v. Richards; Taylor v. Currie; Objection to the reasonableness of the amount of awarded attorney fees raised for the first time on appeal; Jansen v. Jansen; Unclean hands; Whether there was a violation of MCR 2.412(C); Failure to file a motion to strike an appellate brief based on its alleged nonconformity; MCR 7.212(I); The trial court’s authority to take judicial notice of the entire record; Snider v. Dunn

The court affirmed the trial court’s order finding the defendant-ex-wife in criminal contempt for violating a protective order and the divorce judgment, concluding that there was sufficient evidence supporting “the contempt ruling and the underlying finding that defendant willfully disobeyed lawful court orders.” The trial court sentenced her to 93 days in jail, imposed a $7,500 fine, and ordered her to pay the plaintiff-ex-husband $15,000 in attorney fees and $2,625 for costs. During the divorce action, a stipulated protective order mutually prohibited the disclosure of “personal or business financial information revealed and shared during” discovery. The divorce judgment provided that neither party would “have any deliberate contacts with the other party’s clients, adversaries, and business associates,” and would not “disparage the other in any communication with the other’s clients, adversaries and business associates.” After the divorce case ended, “defendant filed a request for investigation with the Attorney Grievance Commission as to plaintiff, who is an attorney, alleging numerous unlawful, unethical, or improper financial dealings” by him, “and apparently utilizing some information previously gleaned through discovery. The grievance was dismissed.” Later, plaintiff’s current wife was sued by her former stepson (S) and plaintiff represented her. There was evidence that defendant mailed an envelope to S’s attorney containing “a letter wherein defendant again accused plaintiff of numerous unlawful, unethical, or improper financial dealings.” S’s attorney testified “in the contempt hearing, and a handwriting expert opined that defendant was the author of” the letter. There was “no dispute that this information was extremely disparaging of plaintiff.” Given that she sent S’s “attorney damaging and disparaging information regarding both plaintiff and plaintiff’s current wife, one could reasonably infer that defendant knew that plaintiff was involved in the lawsuit as counsel for his wife.” Further, given that S’s attorney was litigating a claim against plaintiff’s current wife, the attorney could “reasonably be characterized as an adversary of plaintiff” due to the marital relationship alone.

Whether the court had subject-matter jurisdiction over the appeal; MCR 7.203(A)(1); “Final order” defined; MCR 7.202(6)(a)(i); Whether the circuit court properly dismissed the plaintiff-conservator’s conversion claim for lack of subject-matter jurisdiction; Circuit courts’ jurisdiction; Bowie v. Arder; Probate courts’ limited jurisdiction; D’Allessandro v. Ely; MCL 700.1302(a)-(d); Principle that the court looks to the substance of pleadings rather than the formal names or labels given by the parties; Hurtford v. Holmes; Norris v. Lincoln Park Police Officers; Principle that trial courts cannot grant summary dismissal where there is a disputed issue of material fact; Jones v. Slick; Fiduciary defined; MCL 700.1104; Interpreting an agent with a power of attorney as a fiduciary; Concurrent jurisdiction; MCL 700.1303(1)(j)

Concluding that the circuit court granted summary disposition prematurely in this case involving a conversion claim against defendant related to her actions while acting as an attorney-in-fact and co-trustee for the deceased original plaintiff (Shirley), the court reversed and remanded. The circuit court dismissed due to lack of jurisdiction. On appeal, the court first rejected the claim that it lacked jurisdiction over the plaintiff-conservator’s appeal, concluding that “the dismissal operated functionally as a final order.” As to the circuit court’s jurisdiction, defendant asserted that plaintiff substantively pleaded a claim requiring it “to require, hear, and deny the account of defendant as a trustee, which is within the exclusive jurisdiction of the probate court” under MCL 700.1302(d). However, that was “not entirely accurate. Notably, there was a genuine issue of material fact whether the bank accounts were owned solely by Shirley,” or by her trust. Thus, it was premature to grant summary disposition before resolving that factual question. Further, “MCL 700.1302(d) specifies a fiduciary.” While MCL 700.1104 “does not specifically define an attorney-in-fact as a ‘fiduciary,’ the language of the statute includes ‘not limited to.’” An agent with a power of attorney (POA) “could be interpreted as a fiduciary under the exclusive jurisdiction under MCL 700.1302, if it ‘concern[s] an estate within the court’s jurisdiction.’” As to concurrent jurisdiction, an agent under a POA “would fall under probate court jurisdiction, but only if ‘it is in regard to an estate of a decedent, protected individual, ward or trust.’” Plaintiff asserted “that the disputed funds were in bank accounts solely in Shirley’s name, and if true, pursuant to MCL 700.1303(j), the allegations would not concern a trust and the probate court would lack concurrent jurisdiction.” The court noted that a “pending petition for conservatorship does not constitute an established and valid conservatorship.” Thus, plaintiff’s claim did not involve “an estate of a . . . protected person,” under MCL 700.1303(1). If Shirley’s assets were not connected to her trust, “the probate court did not have exclusive or concurrent jurisdiction, regardless of a pending conservatorship petition.”

Case evaluation sanctions; MCR 2.403(O)(1); Actual costs; MCR 2.403(O)(6)(a) & (b); Great Lakes Gas Transmission Ltd. P’ship v. Markel; Attorney fees; Smith v. Khouri

Concluding that it could not be disputed that defendant-Allstate incurred attorney fees recoverable under MCR 2.403(O), the court reversed the denial of Allstate’s request for case evaluation sanctions in the form of attorney fees, and remanded for the trial court to determine the proper amount of attorney fees to which it was entitled under MCR 2.403(O)(6)(b) and the Smith factors. A case evaluation panel issued a case evaluation of $120,000 in Allstate’s favor against third-party defendant-Odeh, which it accepted and Odeh effectively rejected. Judgment was later entered for Allstate in the amount of $388,643.42, plus $12 in taxable costs and $26,525.40 in interest. It sought $111,090 in attorney fees ($300/hour for 370.3 hours). The court noted that “the trial court’s ruling was not so much a determination that the case generally did not mandate an award of case evaluation sanctions under MCR 2.403, as it was a determination that Allstate simply did not present a properly-supported request for sanctions.” On appeal, Allstate failed to “challenge the trial court’s conclusions that counsel’s biography and the mere allegations in Allstate’s motion did ‘not constitute admissible evidence of an appropriate hourly rate.’” It also did not address the “concerns about the unidentified persons in the bill of costs and the basis justifying a $300 hourly rate for their services.” However, there were “also problematic aspects of the trial court’s ruling. The Economics of Law Practice Survey clearly constituted proper evidence that could be considered in determining the reasonableness of an hourly rate.” Further, “the initials of Allstate’s counsel, with whom the trial court was familiar, dominate the bill of costs,” undermining the “decision not to grant any attorney fees” due to the unidentified persons. The trial court “did not identify what entries in the bill of costs it deemed to be redundant and excessive,” and its “finding that the legal issues and concepts involved in the case were not novel, complex, or difficult certainly cannot serve as a basis to deny an award of attorney fees altogether.”

Legal malpractice; Res judicata; Sewell v. Clean Cut Mgmt., Inc.; Dart v. Dart; Adair v. State; Allen v. McCurry; Brown v. Felsen; Richards v. Tibaldi; Garrett v. Washington; Whether plaintiff’s failure to file her malpractice claim as a counterclaim to defendants’ prior district court collection action barred her claim; Leslie v. Mollica; Van Pembrook v. Zero Mfg. Co.; Effect of the fact Michigan is a compulsory joinder state; MCR 2.203(A) & (E); Salem Indus., Inc. v. Mooney Process Equip. Co.; Adoption of the transactional test; Goss v. Monroe Auto Equip. Co.; Distinguishing Wayne Cnty. v. Detroit & Sprague v. Buhagiar; Board of Cnty. Rd. Comm’rs for the Cnty. of Eaton v. Schultz; Karp v. Michigan Nat’l Bank (Unpub.)

Holding that plaintiff’s failure to file her legal malpractice claim as a counterclaim to defendants’ district court collection action did not bar her claim under res judicata, the court reversed summary disposition for defendants and remanded. They represented her in post-divorce litigation. She did not answer the complaint in their collection action, and a default and default judgment were entered by the clerk in that case. About a month later, she filed this legal malpractice case. Defendants successfully moved for summary disposition on the basis that the collection suit constituted res judicata “as to all claims arising out of their representation of plaintiff” in the post-divorce litigation. The court found that their argument sought to “apply the transactional test so broadly as to construe the entire course of an attorney-client relationship to be subsumed in the failure of plaintiff to pay a bill.” In light of long-standing case precedent, it declined to do so. In Leslie, “the Supreme Court addressed precisely this question. It held that when a professional, (in Leslie it was a physician), files a collection case against a former client, the client is not required to plead her malpractice claim at that time and may do so later without being barred by” res judicata. The court found that Leslie remains good law, noting that in Van Pembrook, it more recently similarly rejected the claim that res judicata barred a suit due to a plaintiff’s failure to raise claims in defendant’s prior case against plaintiff. The fact that Michigan is a compulsory joinder state does not mean it “is a compulsory counterclaim state.” The court held in Salem that “MCR 2.203(E) ‘is permissive, as opposed to compulsory’ and ‘allows a party the option to maintain its counterclaim in a separate independent action.’” Defendants did not rebut Leslie, Van Pembrook, or Salem, other than to argue that they were “no longer good law because Michigan now applies the transactional test.” However, that test was adopted well before Van Pembrook and Salem were decided, and they cited no case indicating that the Supreme Court “has abandoned the long-standing rule articulated in Leslie.” Further, none of the purposes underlying the doctrine applied here.

Action for death caused by a motor vehicle; MCL 500.3135(1); Failure to drive with an assured, clear distance ahead; MCL 257.627(1); Cole v. Barber; Whether headlights must be visible from a distance of 500 feet; MCL 257.686(1); MCL 257.695(a); Whether MCL 257.684 is poorly drafted; Johnson v. Miller; A driver’s duty to exercise due care under the conditions; DePriest v. Kooiman; Sudden emergency; McKinney v. Anderson; Vander Laan v. Miedema; Principle that a driver need not guard against every conceivable result; Hale v. Cooper; Principle that negligence cannot be found where a victim darts into a driver’s car & the driver did not see the victim; Houck v. Carigan; Whether an expert’s opinion was properly considered; Principle that summary disposition is not precluded simply because a party has produced an expert to support its position; Principle that the expert’s opinion must be admissible; Amorello v. Monsanto Corp.; Principle that an expert’s opinion must not be speculative; Edry v. Adelman; Principle that an expert’s opinion must be based on established evidence & cannot rely entirely on disparaging the personal observations of eyewitnesses; Badalamenti v. William Beaumont Hosp.-Troy; Expert testimony; MRE 702

The court held that the trial court erred by denying defendant-driver’s renewed motion for summary disposition in the negligence action filed by plaintiff-decedent’s estate and personal representative. Plaintiff struck the decedent (K) with his car as the decedent was crossing the street. K died of his injuries. Plaintiffs sued defendant for negligence on the theory that defendant “failed to drive with an ‘assured, clear distance ahead’” and “failed to exercise the due care required at common law.” On appeal, the court found that “uncontested evidence that [K] suddenly stepped directly in front of defendant’s vehicle, especially while wearing entirely black clothing in an obviously poorly-illuminated part of a road at night in adverse weather conditions, and that defendant was not apparently otherwise driving in a negligent or improper manner, would avoid strict application of the assured clear distance rule and mandate summary disposition in defendant’s favor.” It found plaintiffs’ expert’s (H) conclusion that defendant should have been able to see K “for 13 seconds to be speculative, based on unreliable data, and based on an inaccurate understanding of MCL 257.684 and the implications thereof.” Further, H’s conclusion that K was in the crosswalk was also “necessarily speculative.” Thus, excluding H’s affidavit, there was “no evidence in the record that defendant was negligent.” Instead, the record demonstrated “defendant was driving carefully and that [K] created an unsuspected emergency, not of defendant’s making, when he stepped out in front defendant’s vehicle some distance outside the crosswalk.” Reversed.

Slip & fall; Premises liability; Sanders v. Perfecting Church; Duty to an invitee; Hoffner v. Lanctoe; Stitt v. Holland Abundant Life Fellowship; Constructive notice; Clark v. Kmart Corp.; Lowery v. LMPS & LMPJ, Inc.; Proof of notice; Williams v. Borman’s Foods, Inc.

The court held that, because plaintiff-restaurant patron did not assert that defendant-restaurant owner had actual notice of the grease or oil on which she slipped and fell, it was speculative to deduce that defendant was responsible for placing any grease or oil on the floor, and she did not provide evidence “tending to suggest that defendant should have been on notice of any” grease or oil. Thus, it affirmed summary disposition for defendant. Plaintiff sued defendant for injuries she sustained when she slipped and fell on an area of tiled flooring in front of the kitchen at defendant’s restaurant. The trial court granted summary disposition for defendant, finding plaintiff failed to establish a genuine question of fact whether defendant had notice of or created the dangerous condition. On appeal, the court rejected her argument that “defendant knew or should have been aware of the condition of the floor and failed to properly maintain” the premises, finding she failed to establish the requisite evidence. It noted that “although the residue on [her] hands and knees is sufficient to raise a question of fact as to whether there was residue on the floor when she fell, it is pure speculation when it was deposited, and based on her noticing a difference on her way back from the restroom and her own description of how difficult it was to get up after her fall, the evidence strongly implies that any such residue could not have been deposited longer ago than her trip to the restroom.” Further, the fact it was invisible to her and to the other witnesses also suggested “that defendant should not have been aware of its presence until plaintiff fell.” The court also rejected her claim that proof of notice was unnecessary because defendant negligently created the dangerous condition, finding the argument speculative. “[G]iven that the area was apparently also the path to the restroom, anything on the floor could easily have come from a patron. We are uninclined to presume that a regular cleaning schedule in a restaurant is evidence of filth.” Moreover, “no witness actually observed any grease or oil on the floor.”

Whether the court had subject-matter jurisdiction over the appeal; MCR 7.203(A)(1); “Final order” defined; MCR 7.202(6)(a)(i); Whether the circuit court properly dismissed the plaintiff-conservator’s conversion claim for lack of subject-matter jurisdiction; Circuit courts’ jurisdiction; Bowie v. Arder; Probate courts’ limited jurisdiction; D’Allessandro v. Ely; MCL 700.1302(a)-(d); Principle that the court looks to the substance of pleadings rather than the formal names or labels given by the parties; Hurtford v. Holmes; Norris v. Lincoln Park Police Officers; Principle that trial courts cannot grant summary dismissal where there is a disputed issue of material fact; Jones v. Slick; Fiduciary defined; MCL 700.1104; Interpreting an agent with a power of attorney as a fiduciary; Concurrent jurisdiction; MCL 700.1303(1)(j)

Concluding that the circuit court granted summary disposition prematurely in this case involving a conversion claim against defendant related to her actions while acting as an attorney-in-fact and co-trustee for the deceased original plaintiff (Shirley), the court reversed and remanded. The circuit court dismissed due to lack of jurisdiction. On appeal, the court first rejected the claim that it lacked jurisdiction over the plaintiff-conservator’s appeal, concluding that “the dismissal operated functionally as a final order.” As to the circuit court’s jurisdiction, defendant asserted that plaintiff substantively pleaded a claim requiring it “to require, hear, and deny the account of defendant as a trustee, which is within the exclusive jurisdiction of the probate court” under MCL 700.1302(d). However, that was “not entirely accurate. Notably, there was a genuine issue of material fact whether the bank accounts were owned solely by Shirley,” or by her trust. Thus, it was premature to grant summary disposition before resolving that factual question. Further, “MCL 700.1302(d) specifies a fiduciary.” While MCL 700.1104 “does not specifically define an attorney-in-fact as a ‘fiduciary,’ the language of the statute includes ‘not limited to.’” An agent with a power of attorney (POA) “could be interpreted as a fiduciary under the exclusive jurisdiction under MCL 700.1302, if it ‘concern[s] an estate within the court’s jurisdiction.’” As to concurrent jurisdiction, an agent under a POA “would fall under probate court jurisdiction, but only if ‘it is in regard to an estate of a decedent, protected individual, ward or trust.’” Plaintiff asserted “that the disputed funds were in bank accounts solely in Shirley’s name, and if true, pursuant to MCL 700.1303(j), the allegations would not concern a trust and the probate court would lack concurrent jurisdiction.” The court noted that a “pending petition for conservatorship does not constitute an established and valid conservatorship.” Thus, plaintiff’s claim did not involve “an estate of a . . . protected person,” under MCL 700.1303(1). If Shirley’s assets were not connected to her trust, “the probate court did not have exclusive or concurrent jurisdiction, regardless of a pending conservatorship petition.”

Failure to plead False Claims Act (FCA) claims with “particularity” as required by Fed.R.Civ.P. 9(b); 31 USC § 3729 et seq.; United States ex rel. Prather v. Brookdale Sr. Living Cmtys., Inc.; Chesbrough v. VPA, P.C.; Yuhasz v. Brush Wellman, Inc.; United States ex rel. SNAPP, Inc. v. Ford Motor Co.; Intentional presentation of a false or fraudulent claim to the government for payment for “off-label” prescriptions; § 3729(a)(1)(A); United States ex rel. Bledsoe v. Community Health Sys., Inc. (Bledsoe II); United States ex rel. Marlar v. BWXT Y-12, LLC; § 3729(a)(1)(B), (C), & (G) claims; Allison Engine Co. v. U.S. ex rel. Sanders; American Textile Mfrs. Inst., Inc. v. The Ltd., Inc.; Bell Atl. Corp. v. Twombly; “Futility” of a third amended complaint; Fed.R.Civ.P. 15(a); SFS Check, LLC v. First Bank of DE; “Public disclosure bar”; U.S. ex rel. Antoon v. Cleveland Clinic Found.; § 3730(e)(4)(A)–(B); Dingle v. Bioport Corp.; U.S. ex rel. Poteet v. Medtronic, Inc.

Because the relators in this qui tam action failed to plead violations of the FCA that satisfied Rule 9(b)’s pleading requirements, the court affirmed the district court’s orders dismissing the complaint in part and denying their motion to amend. This suit was brought by former sales representatives of defendant-Bristol-Myers Squibb and alleged violations of the FCA related to the promotion and distribution of the drug “Ablify.” The relators claimed, among other things, that the defendants schemed to influence providers to prescribe Abilify for “off-label” uses, that some of these prescriptions were covered under government programs, and that providers were improperly induced to prescribe Abilify through benefits and remunerations. They asserted that “requests for government reimbursement for off-label prescriptions and prescriptions induced by kickbacks constitute false claims under the FCA.” Their second amended complaint presented a FCA § 3729(a)(1)(A) claim, which prohibits the intentional presentation of a false or fraudulent claim to the government. The court held that the relators failed to plead this claim with particularity, as required under Rule 9(b), where they did “not provide any representative claim that was actually submitted to the government for payment.” It rejected their request to “apply a ‘relaxed’ Rule 9(b) pleading standard” based on “specific personal knowledge” set forth in Prather where they did not allege that type of personal knowledge. Their § 3719(a)(1)(B) claim was inadequately pleaded where they failed to connect allegedly false statements to the submission of an actual claim made to the government. The relators failed to plead their § 3719(a)(1)(G) “reverse false claim” with particularity where they did not plead facts to show that the defendants received or retained overpayment, or that they “were under an affirmative obligation to the government at the time the alleged false statements were made.” The court also held that they provided no specific statement “showing the plan was made to defraud the government” as required for an FCA conspiracy under § 3719(a)(1)(C). It also agreed with the district court that allowing the relators to file a third amended complaint would have been futile.

Dispute over city ordinances regulating sexually oriented businesses; Overbreadth challenge; Principle that an overbreadth challenge is an exception to traditional standing rules; Michigan Up & Out of Poverty Now Coal. v. Michigan; Mootness; B P 7 v. Bureau of State Lottery; Ripeness; City of Huntington Woods v. Detroit; Vagueness; Plymouth Twp. v. Hancock; Principle that the governmental interest in combating the negative secondary effects associated with adult entertainment establishments is unrelated to the suppression of the erotic message conveyed by nude dancing; Erie v. Pap’s A M; Restrictions on how far semi-nude employees must remain from patrons or customers; Sensations, Inc. v. Grand Rapids (6th Cir.); Lady J Lingerie, Inc. v. Jacksonville (11th Cir.); Peek-A-Boo Lounge of Bradenton, Inc. v. Manatee Cnty., FL (11th Cir.); Principle that a person holding a liquor license has a vested property right in the license; Bundo v. Walled Lake; Principle that one does not have a due process right to the continuation of an existing law; Van Buren Twp. v. Garter Belt, Inc.; Review under the standards applicable to content-neutral time, place, & manner regulations; Truckor v. Erie Twp.; Principle that the whims of the real estate market are of no concern; Renton v. Playtime Theatres, Inc.; Expert testimony; MRE 702; Klabunde v. Stanley; “Manual review”; Young v. Nationwide Mut. Ins. Co. (6th Cir.)

The court held that the trial court did not err by granting summary disposition for defendant-city in this case involving constitutional challenges to its licensing and zoning ordinances regulating sexually oriented businesses. On appeal, the court first held that the trial court correctly found that plaintiffs lacked standing to challenge the licensing ordinance beyond their overbreadth argument. It next rejected plaintiffs’ argument that the ordinance’s no-touching provision is overbroad because “an employee might violate the ordinance if he or she regularly appears semi-nude, but while fully clothed, accidentally brushes against” a customer, noting the provision expressly does not prohibit accidental contact. As to their claim that the terms “lewdness” and “public indecency” are impermissibly vague, the ordinance at issue “does not actually prohibit ‘lewdness’ or ‘public indecency’ at all, but rather prohibits specific and defined conduct for a purpose, the arguable vagueness of which is largely irrelevant.” The court further rejected their challenge to the ordinance’s prohibition against nudity and restrictions against “semi-nudity” on First Amendment freedom of expression grounds, noting they failed to show how such restrictions violate the First Amendment. In addition, it rejected their contention that “the ordinance revision that eliminated an exception to the prohibition against alcohol inside sexually oriented businesses deprives them of a protected property interest in their liquor license without due process,” finding they “have not been deprived of that license, but rather from serving liquor under certain circumstances, and they do not have a due process right to the continuation of an existing law.” Finally, the court rejected their argument that the trial court erred in finding that defendant’s zoning ordinance leaves open adequate alternative channels of adult expression. “Given that there is only one entity seeking to operate an adult business in” the city, “and there exist over 100 whole or partial parcels where an adult business could be located, the zoning ordinance clearly does not deny plaintiffs a reasonable opportunity to operate a sexually oriented business in” the city. Affirmed.