Request for an evidentiary hearing; Whether the request was forfeited; Kernen v Homestead Dev Co; Waiver; People v Carter; Sulaica v Rometty; Effect of a settlement agreement; MCR 2.507(G); Clark v Al-Amin

Holding that the trial court erred by denying appellants-homeowners’ request for an evidentiary hearing, the court vacated the order of dismissal and remanded for an evidentiary hearing to determine the extent to which each party complied with their settlement agreement. Appellants purchased doors and windows from appellee, but withheld a portion of the amount due, challenging the quality of appellee’s workmanship. The parties eventually reached a settlement under which appellee would make repairs and appellants would pay an agreed-upon amount pending approval of the work by the parties’ experts. The parties still could not agree, and appellee filed a motion to enforce the settlement. The trial court ultimately ordered appellants to pay out the agreed-upon sum, denied their request for an evidentiary hearing, and dismissed the case. On appeal, the court rejected appellee’s argument that appellants either forfeited their claim of error because they failed to request an evidentiary hearing before the trial court reached its decision, or waived any error by stipulating to the final judgment. Appellants “did not wait until after the court proceeding to seek a hearing. Rather, [they] requested an evidentiary hearing when the court entertained [appellee’s] motion to enforce the settlement agreement, immediately after the court ordered [appellants] to release the funds held in escrow.” In addition, appellants “were very clear in this case that they approved the order as to form only, acknowledging that the order embodied the” trial court’s ruling. The court then found that the trial court abused its discretion by denying appellants’ request for an evidentiary hearing and ordering them to release the funds held in escrow. “[O]n the existing record the [trial] court could not fairly determine if [appellee] had met its end of the bargain, triggering [appellants’] duty to release the escrowed funds.” In addition, “neither side presented any evidence useful to resolving the dispute.” The court concluded that although “the terms of the settlement agreement itself did not demand an evidentiary hearing, absent record evidence that [appellee] hired an expert as required, coupled with the competing unsupported arguments about the sufficiency of the repairs, the [trial] court had no reasonable option but to hold an evidentiary hearing.” It abused its discretion in failing to do so.