Account stated; Breach of contract; Apparent authority of an agent to bind a principal; Whether conduct created an implied-in-fact contract; Whether witness immunity barred a counterclaim for accounting malpractice; Whether summary disposition was premature without further discovery; “Frivolous” counterclaim; Kohn Financial Consulting, LLC (KFC); Productivity Technologies Corporation (PTC)

The court held that intervening plaintiff-KFC was properly granted summary disposition of its account stated claim. Also, defendant-Atlas’s Vice President of Finance (nonparty-N) had actual authority to bind defendants to the contract with KFC, and the trial court did not err by holding that the parties’ conduct created an implied-in-fact contract. Further, it did not err by dismissing defendants’ accounting malpractice counterclaim on the ground that KFC’s principal and his work product were subject to the protection of witness immunity. Summary disposition was not premature, and the trial court did not clearly err by ruling that defendants’ counterclaim against KFC was frivolous. The case arose from “defendants’ alleged failure to pay KFC for professional services rendered in relation to federal lawsuits filed by defendants against their former manager and director.” Atlas is the sole asset of defendant-PTC, a holding company. The court concluded that because “defendants received multiple invoices from KFC showing a balance owing, yet failed to object to any of them, defendants may be considered to have admitted the correctness of the amount owed, and KFC was justified in treating the balance owing as an account stated.” As to KFC’s breach of contract claim, evidence supported the trial court’s determination that N “had actual authority, or apparent authority at a minimum, to engage KFC on defendants’ behalf.” The court further held that “an implied-in-fact contract arose between defendants and KFC that obligated KFC to provide accounting services to defendants and defendants to pay for the services provided. KFC provided those services, as is evinced by its invoices, detailed time logs, and work product, and defendants paid for only part of the services received, causing KFC to suffer damages in the amount of the unpaid balance.” The court also concluded that defendants’ counterclaim rested “entirely on deficiencies in the expert report KFC created to prepare for its own expert testimony in the federal court. Witness immunity includes not just witness testimony, but ‘necessarily extends to any other materials or evidence prepared by the witness for the intended benefit of the court.’” Affirmed.