The top stories of 2024 … so far

Michigan Lawyers Weekly’s most popular stories from January-June 2024 include decisions from the state and federal courts addressing matters of great importance to the legal community and public at large.

Our top stories included cases from the 6th U.S. Circuit Court of Appeals and the Eastern District of Michigan, as well as the Michigan Supreme Court and Court of Appeals.One highlighted the shift in premises liability law based on a 2023 Michigan Supreme Court decision. Another involved a beachfront community’s zoning ordinance for short-term rentals, and an age discrimination case brought by a longtime Detroit Tigers employee proved popular with our readers.

We hope you enjoy this recap of the top stories of the year so far.

January

Embryo properly awarded to husband

A trial court did not err when it awarded the husband of a divorced couple the parties’ cryogenically preserved embryo created with an egg from the wife’s sister fertilized by sperm from the husband, a divided panel of the Michigan Court of Appeals has ruled.

While the lower court “appreciated the special characteristic of the embryo to produce a human life,” it sided with the husband because it would be more inequitable to have the wife birth a child with her ex-husband’s DNA against his wishes, as opposed to the inequity the wife would suffer by being prohibited form birthing a child that does not share her DNA.

“Simply put, given the circumstances of this case, the outcome derived by the trial court was a principled decision, and we are not left with a firm conviction that awarding the embryo to [the husband] was inequitable,” the majority said.

Factors properly weighed

The trial court agreed that either party had the right to make decisions relating to reproductive freedom, and its decision did not infringe on how the parties could exercise any such right rather, the dispute involved competing rights.

Sarah pointed to language in the contract preamble that stated an intent to have the embryos transferred “back to my uterus” in a later cycle.

The appeals court, however, looked at the next section of the contract, which provided for embryo disposition in the event of divorce, where the parties agreed that the disposition of the embryos would be “[d]etermined by the applicable Judgment of Divorce or other court order.”

“The agreement clearly contemplates that in the event of a divorce, a court, either through a judgment of divorce or through some other order, is to decide the proper disposition of any remaining, viable embryos,” the judges wrote. “To the extent there is tension or conflict in the overriding intention to use and implant the embryos and this intention to have a court decide the disposition of any embryo in the event of a divorce, specific clauses in contracts prevail over more general terms.”

By concluding that the contract did not specify how the court was to make that determination aside from allowing a court to decide what would happen to any embryos in the event of a divorce the trial court did not err, the panel found.

“The fact that there was a general agreement between the parties is not the question; the question is whether there was an agreement ‘addressing the disposition of the embryo’ under the present circumstances, i.e., in the event of a divorce,” the majority explained. “And in this instance, because the agreement merely deferred to a court’s determination, it cannot be considered an actual agreement regarding the embryo’s disposition. The trial court rightfully recognized that ‘there’s not a meaningful valid agreement as to disposition of the embryo.’”

When the court applied the Sparks factors for dividing marital property, Sarah contended that the trial court failed to properly weigh that she has been paying for the storage of the embryo since the divorce and that she was “the overwhelming primary contributor” to the embryo, “putting herself through several different medical procedures.”

But the trial court never found that Sarah paid for the storage of the embryo, the panel said. Although Sarah undoubtedly underwent many medical procedures, the embryo at issue was not created as a result of any of those procedures.

“The embryo was created by taking an egg from Sarah’s sister, which was then fertilized by sperm from David,” the judges wrote. “Although Sarah nobly went through various procedures during the entire IVF processes, those resulted in three children being born and were not directly related to the creation of the embryo at issue in this case.”

While Sarah contributed to the embryo in terms of procedures, costs and family lineage the egg was from her sister only David contributed genetically to the embryo, the majority pointed out. Sarah was not foreclosed from having more children through other egg donors.

The judges affirmed the trial court’s order awarding the parties’ cryogenically preserved embryo to David.

The per curiam decision is Markiewicz v. Markiewicz ( MiLW 08-107494 ). The story was published on Jan. 5.

***

Sixth Circuit rejects short-term rental owners’ challenge against city

A group of homeowners again lost their bid to proceed with claims against a city resolution that suspended the issuance of permits for short-term rentals, or STRs, in a southwest Michigan beach community.

The homeowners challenged the city’s actions as unconstitutional and contrary to Michigan law, but the Western District of Michigan granted summary judgment for the city on those claims, concluding that plaintiffs lacked a protected property interest.

The 6th U.S Circuit Court of Appeals affirmed in an unpublished decision.

“The district court correctly interpreted the original zoning ordinance: it prohibited all uses that it did not expressly permit,” U.S. Circuit Judge John K. Bush wrote. “And using the contested properties as STRs without a permit was not a permitted use. As a result, Plaintiffs lacked a protected property interest in the nonconforming use of their properties as STRs.”

‘Oppressive’ ordinance

Considering cross motions on substantive due process, U.S. District Court Judge Hala Y. Jarbou found the plaintiffs weren’t able to show that they had a protected property interest that would give rise to such a claim in Moskovic v. City of New Buffalo (MiLW 03-106090).

The plaintiffs did not show their uses were allowed by the city’s zoning ordinance, and they did not have a protected interest in a short-term rental permit because a first-time applicant for a permit does not have such an interest, she explained.

Nor were the plaintiffs able to demonstrate arbitrary and capricious action necessary for a substantive due process claim because they failed to show that the city’s actions were so irrational that they “shock the conscience.”

“The city ostensibly passed the moratorium due to various concerns about the impact of short-term rentals on the quality of life in the city, including declining school enrollment, declining long-term housing stock, declining long-term resident population and an increase in vacant homes in the winter months,” Jarbou wrote. “It is not difficult to see how an increase in the number of properties used as short-term rentals could have the negative effects identified by the city. Plaintiffs provide evidence suggesting that some of these concerns are not supported by available data, but plaintiffs do not negate every conceivable basis for restrictions on short-term rentals, such as a decrease in available housing stock for long-term residents.”

The plaintiffs argued that Ordinance 253 was “oppressive” because it operates retroactively to restrict their property rights, in violation of state law, but “a violation of state law does not necessarily give rise to a constitutional claim,” Jarbou said. “And the violation alleged here does not shock the conscience.”

She dismissed the plaintiffs’ substantive due process claim and reached the same result on the procedural due process claim. Again, the plaintiffs failed to show that they possessed a protected property interest, the judge noted. In addition, the moratorium was adopted and extended via resolutions, which do not require publication under state law; nor did the moratorium single out or target a particular person, or even a relatively small number of persons, on individual grounds.

6th Circuit holding

On appeal, the homeowners claimed New Buffalo issued almost 100 STR permits in zoning districts R-1, R-2, and R-3 under Ordinances 237 and 248; this, they argued, showed the city interpreted the original zoning ordinance to allow STRs in these districts.

“But those ordinances require a permit to use a property as an STR, and it is undisputed that Plaintiffs never received any of those 93 permits,” Bush pointed out. “Thus, although Ordinances 237 and 248 allowed owners to use their properties as STRs with a permit, Plaintiffs never received a permit to vest their right to use their properties as STRs.”

The homeowners also argued that they had a substantive due process right to get permits, since Ordinances 237 and 248 required the city to issue an STR permit if the applicant complied with the permitting requirements.

They contended that Wojcik v. City of Romulus and Women’s Med. Pro. Corp. v. Baird were inapplicable here. While those cases involved discretionary permitting schemes, the STR permitting scheme in this case mandated that New Buffalo issue an STR permit once a property owner satisfied its prerequisites.

But Bush noted that the plaintiffs never applied for STR permits until after New Buffalo imposed the moratorium.

“Because they waited until after the moratorium was in place to apply for STR permits, Plaintiffs lacked ‘a legitimate claim of entitlement’ to the permits to create a protected property interest in them,” he said. “The moratorium enabled the City to reject permits, notwithstanding the permitting scheme established by Ordinances 237 and 248, so Plaintiffs did not have a protected property interest in receiving STRs permits when they applied.”

The homeowners’ takings and MZEA claims also failed because they did not establish that New Buffalo deprived them of a vested property interest.

U.S. Circuit Judges Julia Smith Gibbons and Stephanie Dawkins Davis joined Bush’s opinion in Moskovic, et al. v. City of New Buffalo, Michigan .The story was published on Jan. 9.

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‘Retroactive application’: ‘Kandil-Elsayed’ revives premises liability case

The Michigan Court of Appeals held that the Michigan Supreme Court’s decision in Kandil-Elsayed v. F & E Oil, Inc. , should act retroactively and be applied to cases that are currently pending.

The published decision made its first impact, reviving a premises liability suit brought by a woman who was injured in a fall outside of her home in a Livonia condominium complex.

“[T]he Kandil-Elsayed Court applied the rule of law it announced to the parties in that case, and has also vacated our judgments and remanded numerous cases to this Court for reconsideration in light of its decision in Kandil-Elsayed, in lieu of granting leave to appeal,” Judge Mark J. Cavanagh wrote. “Although not dispositive, it appears to us through these actions that our Supreme Court intended retroactive application of its holding in Kandil-Elsayed .”

In a pointed concurrence, Judge Michael F. Gadola wrote to note his “disagreement with the Supreme Court’s conclusion in Kandil-Elsayed that its prior decision in Lugo v Ameritech Corp , Inc, ‘defies practical workability because it has generated considerable confusion and division.’”

Retroactive decision

“Under the new premises-liability framework outlined by the Kandil-Elsayed Court, a land possessor’s duty to an invitee remains the same, as well as the three traditional categories of entrants upon the land of another,” Cavanagh pointed out.

The question for the appeals court was whether Kandil-Elsayed is retroactive, making it applicable to the instant case as well as other pending matters.

“Because the Kandil-Elsayed decision establishes a new principle of law, we must next consider three factors: ‘“‘1) the purpose to be served by the new rule, (2) the extent of the reliance on the old rule, and (3) the effect of retroactivity on the administration of justice,’”’ Cavanagh wrote. “After consideration of these three factors, we conclude that retroactive application is appropriate.”

Nor would the administration of justice be adversely affected by retroactive application, the judge added.

“Possessors of land need only to have exercised reasonable care under the circumstances as has always been the case,” he explained. “Under Kandil-Elsayed , the finder of fact will be apprised of those circumstances including the open and obvious nature of the allegedly dangerous condition and will consider the comparative fault of each party, including the plaintiff’s choice to confront the danger. Moreover, the retroactive application of the decision will actually further goals of the administration of justice by ensuring that premises-liability claims are adjudicated by the same standard applicable to other negligence claims, affording claimants the same right to have their claims considered under a comparative-fault regime rather than a contributory-negligence scheme.”

As such, “the rule of law announced in Kandil-Elsayed should operate retroactively and applies to all cases currently pending on direct appeal, including this case.”

The decision is Gabrielson v. The Woods Condo. Ass’n Inc . ( MiLW 07-107541 ). The story was published Jan. 15.

***

Lakefront landowners fail in bid for prescriptive easement

Summary disposition for plaintiff lakefront landowners on their prescriptive easement claim must be reversed because they could not establish that a 15-year unopposed, continuous trespass occurred on the relevant portions of the defendant’s bottomlands, a panel of the Michigan Court of Appeals held.

When the defendant found out that his neighbors’ dock infringed on his bottomlands, he asked that the dock be removed. Instead, he was met with a lawsuit. The plaintiffs said the dock had been on the bottomlands continuously since 1985. As such, they had title to the bottomlands by adverse possession or, alternatively, they had a right to use the bottomlands by a prescriptive easement.

The trial court granted summary disposition in favor of the plaintiffs, but the appellate panel said that was the wrong call.

“[B]ecause the [plaintiffs] cannot establish that a 15-year unopposed, continuous trespass occurred on the relevant portions of the [defendant’s] property’s bottomlands, [defendant] was entitled to summary disposition in his favor on the [plaintiffs’] claim for a prescriptive easement,” the judges explained. “The trial court erred by holding otherwise, and it necessarily follows the trial court erred by denying summary disposition in favor of [the defendant] on his ejectment and trespass claims.”

No prescriptive easement

Citing 2022’s Astemborski v. Manetta , the panel said a “prescriptive easement is no more than an unopposed, continuous trespass [on another’s property] for 15 years. If no single period of adverse use amounts to the 15-year statutory period, a party claiming a prescriptive interest may tack the possessory periods of their predecessors in interest to aggregate the 15-year period of prescription if the claimant can show privity of estate.”

There was a dock on the property when the Baidases bought it in 1985. They replaced the dock in the 1990s and placed it in the same location. There was no dispute that the dock was in the same location until 2009, when Marc moved the dock to the north and removed the hoist.

Aerial photos supported that part of the dock infringed on Schmit’s property’s bottomlands starting in 2006, and continued to do so in 2008. And when Marc moved his dock to the north in 2009, it took up a more sizable portion of the bottomlands.

“Therefore, to establish a prescriptive easement, the dock had to remain on the Schmit property until 2021, in an unopposed manner,” the judges explained. “Because Schmit opposed the location of the dock in 2020, demanding it be removed, the placement of the dock on the Schmit property’s bottomlands did not ripen into a prescriptive easement.”

The Mendelsons tried to rely on the boat hoist’s location, claiming Marc moved the dock to the same location of the boat hoist in 2009.

The judges said the argument was unpersuasive.

Ruth Baidas said the boat hoist was removed from the lake at the end of each boating season when she owned the property. Seasonal use, the trial court noted, can be considered continuous.

But Ruth also said the boat hoist was placed on different sides of the dock between when it was initially installed in the 1990s, and when the property was sold to Marc in 2008.

“Aerial photographs support, if the boat hoist was placed on the south side of the dock during the boating season, it would not infringe on the Schmit property’s bottomlands,” the panel said. “Therefore, the seasonal use of the boat hoist from sometime in the 1990s, to the spring or summer of 2009, when Marc removed it, cannot be considered when determining whether there was continuous, seasonal use for 15 years.”

The aerial photos show that the infringement on Schmit’s property’s bottomlands was more significant when Marc moved the dock in 2009.

“Importantly, a prescriptive right inures only to the actual portion of the property that the claimant adversely used for the 15-year period and does not extend to additional property not used,” the appellate judges said, looking to Engel v. Gildner from 1929.

In that case, the defendants used part of the plaintiff’s land as a driveway for more than 20 years. The defendants sought to use more of the plaintiffs’ land when the plaintiffs extended their driveway. The Engel court found “the defendants established a prescriptive right to continue their historic use of the plaintiffs’ driveway, but they had not established a right to use the extension.”

Here, the Mendelsons “seek precisely the kind of expanded use that Engel forbids,” the judges said. “The placement of the dock in 2009 requires a greater use of the Schmit property’s bottomlands than was required by the boat hoist and prior dock. Indeed, the dock physically required use of more of the bottomlands.”

Using the property after the dock was moved and the hoist was removed in 2009 “amounts to a new burden on the Schmit property and does not support that there was a continuous use for the required period of 15 years, the judges added.

Nor could the Mendelsons rely on an underwater tube used for lawn maintenance to support a prescriptive easement in relation to the dock.

“The prescriptive right inures only to the actual portion of the property that the claimant adversely used for the statutory period and does not extend to additional property not used,” the panel wrote. “The Mendelsons’ attempt to liken an unseen underwater tube to a dock that floated on Walnut Lake year-round and had multiple poles that rested on the bottomlands is unpersuasive.”

The panel reversed the trial court’s order granting summary disposition in favor of the Mendelsons. The matter returns to Oakland County so the trial court can consider if it is proper to award Schmit additional relief.

The unpublished decision is Mendelson v. Schmit ( MiLW 08-107466 ). The story was published Jan. 23.

February

Man not ‘operator’ of parked vehicle

A trial court erred when it concluded that a man was the “operator” of a parked vehicle that allegedly started a fire and destroyed a barn and its contents, a Michigan Court of Appeals panel held, vacating a grant of summary disposition for the insurer.

The appeals court said the only dispute was whether the plaintiff was the “operator” of a vehicle in the accident under MCL 500.3123(1)(b).

“[R]egardless of whether we rely on a dictionary definition of ‘operator’ or we define ‘operator’ as used in MCL 500.3123 by reference to the Michigan Vehicle Code, the result is the same plaintiff was not the ‘operator’ of the Peterbilt truck when the fire started,” the judges explained. “Accordingly, plaintiff was not barred by MCL 500.3123(1)(b) from collecting PPI benefits.”

Not the ‘operator’

The issue to be resolved is whether Chancellor Parker can recover property protection insurance, or PPI, benefits from Canal. The judges said Parker was named in a PPI policy for his personal vehicle, and that he was neither the owner or registrant of the Peterbuilt.

“The parties seemingly agree that plaintiff was the operator of the Peterbilt tractor when he drove it into the barn and parked it,” the panel wrote. “And the parties seem to also agree that the pertinent question is not whether plaintiff was ever, at some point in time, the operator of the Peterbilt tractor, but whether plaintiff could be considered the ‘operator’ of the tractor at the time of the accident.”

Because “operator” is not defined in the relevant statutes, the panel turned to Merriman-Webster Collegiate Dictionary (11th ed)’s somewhat redundant definition of “one that operates.” And operate, in relevant part, is defined as “to cause to function.”

“If we were to rely on these definitions, we would readily conclude that plaintiff was not the ‘operator’ of the parked Peterbilt tractor when the fire started,” the panel said. “That is, plaintiff was not causing the truck to function at the relevant time. Indeed, the tractor was not even actively ‘functioning’ then it was parked, and its engine was off.”

In MCL 257.36(a), “operate” is defined as “[b]eing in actual physical control of a vehicle.” This, the judges said, lends itself to offering “a more useful definition of ‘operator’ as used in MCL 500.3123(1)(b) ‘a person who is in actual physical control of a vehicle (regardless of whether it is on a highway or street).’”

The appeals court concluded that Parker was not the “operator” of the parked vehicle when the fire started.

“Nothing suggests that plaintiff was near the parked truck when the fire started, or that he had any way to exert actual control over the truck at that time,” they explained. “By all accounts, plaintiff was miles away from the barn and the Peterbilt tractor when the fire started. On these facts, no reasonable juror could conclude that plaintiff was ‘in actual physical control’ of the Peterbilt tractor when the fire started.”

As such, Parker was not prohibited by MCL 500.3123(1)(b) from collecting PPI benefits.

The opinion is Parker v. Canal Ins. Co. ( MiLW 08-107606 ). The story was published on Feb. 5.

March

Appeals court vacates ‘excessive’ sanctions for spoliated evidence

A divided Michigan Court of Appeals panel vacated a trial court’s order that sanctioned a defendant for spoliation of evidence because the evidence was not material to the plaintiff’s lawsuit and the sanctions were disproportionate.

The majority said the trial court abused its discretion when it failed to carefully craft a suitable sanction.

“In this case, the trial court’s sanctions interfered with [defendant’s] ability to assert affirmative defenses or present mitigating evidence, which was out of proportion to [defendant’s] alleged misconduct,” the majority wrote. “The trial court’s sanctions would have effectively put an end to the lawsuit in plaintiff’s favor.”

In a dissent , Judge Noah P. Hood said, “This is a case with messy facts for both sides that requires a jury to sort out.”

The lawsuit

McDuffie filed a complaint in June 2020, alleging negligence, gross negligence, willful and wanton misconduct and wrongful death by Neal and NSS, as well as owner liability under MCL 257.401 and vicarious liability by NSS.

Almost a year later, she sought sanctions against NSS for spoliation of evidence pertaining to the case namely, Neal’s driving and employment records, and the dump truck’s maintenance and inspection records.

The Wayne County Circuit Court ordered NSS to produce both the requested documentation and the dump truck. NSS gave Neal’s negative drug and alcohol tests from the day of the incident, along with his certifications, to McDuffie. NSS located the dump truck in Vermont, indicating that it was available for inspection.

But NSS wasn’t able to find or obtain the additional documentation requested, much of which Schubeck said he discarded when the business closed.

The Wayne County court levied sanctions on NSS, saying the company destroyed documents and failed to preserve the dump truck in bad faith. It struck NSS’s affirmative defenses and prohibited the company from offering mitigating evidence. The court also said it would give an adverse inference instruction at trial and ordered NSS to pay sanctions of $3,500.

NSS filed a motion for relief regarding McDuffie’s purported spoliation of evidence, saying she failed to preserve her son’s car. That motion was denied and NSS’s motion for summary disposition met the same fate.

NSS sought leave to appeal, which was granted. The appeals court consolidated the appeals.

Materiality

The panel agreed that NSS’s failure to preserve the dump truck and its service records and Neal’s employment records did not result in spoliation because the evidence was not material to McDuffie’s lawsuit.

“By failing to consider on the record whether the evidence requested was material before finding that NSS spoliated evidence and imposing sanctions, the trial court abused its discretion,” the majority said. “[A] party’s duty to preserve evidence for pending or reasonably foreseeable litigation is limited to evidence that is material to that litigation. The trial court therefore was obligated to determine whether the items requested were material before sanctioning NSS for failing to preserve the items.”

While the trial court concluded that NSS’s failure to preserve the dump truck was spoliation, the majority pointed out that there is proof supporting the speculation that the dump truck’s condition truck caused or contributed to the collision.

“We conclude that the trial court abused its discretion by determining that NSS spoliated both the documents requested and the dump truck,” the judges said. “The trial court did not evaluate on the record the materiality of the evidence requested and the record does not support a finding of materiality. When lost or destroyed evidence is immaterial, sanctioning the party at fault is inappropriate.”

The opinion is McDuffie v. Neal ( MiLW 08-107698 ). The story was published on March 6.

***

Off beat: Romantics member loses appeal over royalties

A member of The Romantics lost his challenge to an order granting summary disposition in favor of another band member and the band’s corporation and requiring him to pay interest, costs and attorney fees in the dispute, a panel of the Michigan Court of Appeals has ruled, further affirming an order of trebled damages.

Although the band had a contractual relationship with various music entities providing that royalties for the band’s music would be paid to Master Beat, Inc. a Michigan corporation formed by the members Michael Skill began diverting royalties to himself beginning in late 2020.

Believing he should be able to get his royalties directly from the companies paying them without having the royalties flow through Master Beat Skill received approximately $56,700 before Master Beats became aware of the issue.

Additional evidence existed that Skill personally withdrew $20,000 from a bank account belonging to Master Beat.

Together with the band’s lead singer Walter Palamarchuk, Master Beat filed suit to remove Skill as a director of Master Beat, alleging claims of breach of fiduciary duty, unjust enrichment, common law conversion and embezzlement and statutory conversion.

During the litigation, the trial court entered multiple scheduling orders that stated they would be strictly enforced and that a failure to timely file a responsive brief would result in the court assuming the party did not have supporting authority for its position.

In one instance, Skill’s brief in opposition to the plaintiffs’ motion for summary disposition was filed late and contained a verbatim copy of the plaintiffs’ brief in support of summary disposition that was signed by defense counsel.

The trial court granted summary disposition along with prejudgment interest, costs and attorneys’ fees in favor of Master Beat and Palamarchuk, reasoning that it had the authority to enter and enforce its scheduling orders and that summary disposition was based on the parties’ timely filings that were before the court.

Per a footnote in the opinion, the court awarded a judgment of “$77,437.26, trebled to $232,311.78, plus applicable prejudgment interest, costs and fees pursuant to MCR 600.2919a.”

In an unpublished per curiam opinion, a Court of Appeals panel affirmed.

When a party violates a scheduling order, it is within the trial court’s discretion to impose a sanction on the party and the fact that the sanction may effectively operate as a dismissal under particular circumstances doesn’t prohibit the court from imposing it.

“Here, the trial court entered scheduling orders providing deadlines applicable to defendant’s response to plaintiffs’ motion for summary disposition, and these scheduling orders explicitly warned that they would be strictly enforced by the court and that a party’s failure to timely file briefs in accordance with the scheduling orders would result in a presumption that the party’s position was not supported by legal authority,” the panel wrote. “Defendant failed to sufficiently comply with these deadlines twice .”

As for the treble damages, instead of following proper procedures for resolving his apparent disputes with the plaintiffs, the defendant took matters into his own hands and took funds from the corporation because he believed it was his right to do so.

But “a disgruntled corporate director is not entitled to resolve his perceived grievances with the corporation by resorting to ‘self-help’ and taking corporate assets ‘against the will and direction of the governing body of the corporation,’ even if he believes he is entitled to those assets,” the panel pointed out.

“The trial court in this case cited the evidence of defendant’s theft to support its judgment against defendant in this case,” the judges said. “Defendant has not demonstrated on appeal that the trial court abused its discretion by awarding treble damages under MCL 600.2919a to penalize defendant’s dishonest conduct.”

The unpublished per curiam decision in Master Beat Inc. v. Skill ( MiLW 08-107755 ). The story was published on March 18.

April

Court tosses injured golfer’s suit against resort

A bachelor party attendee who was injured in a golf cart crash at a northern Michigan resort saw his case dismissed by a Michigan Court of Appeals panel.

The trial court tossed the golfer’s ordinary and gross negligence claims, noting the man signed a release before the round, and that he had been cautioned about the heightened risks posed by the extreme terrain.

“The trial court did not err by concluding that the release is valid, nor did the trial court err by granting defendant summary disposition of plaintiff’s gross-negligence claim,” the panel wrote, affirming the lower court’s ruling.

Ordinary negligence

Matthew Burchard said his ordinary negligence and premises liability claims should go to trial because the trial court erred when it ruled that the release he signed was valid.

He did not dispute that, if the release was valid, it would amount to a waiver of his ordinary negligence and premises liability claims.

“However, he argues that the release is invalid because (1) there was no mutual assent on behalf of defendant, as a representative of defendant did not sign it; (2) the release was not ‘knowingly’ signed by plaintiff because he was not informed about safe braking, the fact that the golf course did not comply with national safety standards, and the fact that the terrain ahead was dangerous; and (3) it was not ‘fairly’ signed by plaintiff because he was not informed that he would be required to sign the release until after he paid for the golf round, and defendant would not allow him to avoid the release by walking or using a pull cart,” the panel wrote. “None of these arguments have merit.”

The panel said 2005’s Hall v. Small decision “specifically rejected the contention that a release ‘lacks mutuality of agreement’ because it was not signed by the other party.”

Here, the release plainly stated that it was not intended to be signed by a representative of Treetops to be valid.

As for Burchard’s second argument, the vocal warnings provided by the starter and the language in the release referring to “extreme terrain” at the resort also made the dangers “knowing.”

“Even if plaintiff did not read the release before signing it, his failure to do so would not warrant rescission of the release,” the panel pointed out.

The judges then shot down Burchard’s third argument: that there was other fraudulent or overreaching conduct.

“[W]hile it is true that plaintiff was not presented with the release until after he paid for the golf round, and that he was not allowed to walk or use a pull cart, these facts do not compel the conclusion that the release was ‘unfairly’ provided,” the panel concluded. “There is nothing in the record to suggest that plaintiff would have been unable to obtain a refund if he refused to sign the release or that defendant somehow pressured him into signing the release despite his unwillingness to do so. Nor has plaintiff identified any other egregious facts.”

No gross negligence

Burchard also contended that, since he established a genuine issue of material fact as to whether Treetops was grossly negligent, that claim should go to trial.

The judges disagreed.

“In this case, the facts show that defendant displayed some level of concern for the safety of its customers,” they wrote. “The golf cart at issue, as with all other golf carts, was inspected for safety about a week before the accident occurred and found to have no problems. The fact that the golf cart was examined post-accident and found to have no operational defects seemingly confirms the earlier inspection.”

The judges pointed out that Treetops’s starter cautioned golfers to drive carefully on the hilly terrain and to use the cart’s brakes. Also, the liability waiver specifically included warnings, and a speed bump and warning sign are at the top of the hill on the third hole.

“Given the high standard for establishing gross negligence, ‘almost a willful disregard of precautions or measures to attend to safety and a singular disregard for substantial risks,’ it is difficult to conclude that defendant satisfied this standard in light of its multiple precautionary measures,” the panel said, quoting Tarlea v. Crabtree .

Burchard’s remaining arguments that the hill’s slope exceeded not only industry standards, but the guidelines in the golf cart operational manual and that the resort had knowledge that the third hole could be made safer were also rejected.

The decision is Buchard v. Treetops Acquisition Co LLC ( MiLW 08-107820 ). The story was published on April 1.

***

Court reinstates $227K award of attorneys’ fees

A Michigan Court of Appeals majority reinstated a $227,273 award of contractual attorneys’ fees, saying the trial court ran afoul of the law-of-the-case doctrine when it slashed the award to $0.

The panel said the trial court abused its discretion when it used the “additional relevant factors” prong of its Pirgu analysis “as a backdoor method of relitigating the issue” of whether the defendant’s employment contract had been assigned to the plaintiff.

“The law-of-the-case doctrine and the interests of maintaining consistency and avoiding reconsideration of matters already decided instruct us that this decision cannot stand,” the panel concluded, reversing the trial court.

In a partial concurrence and partial dissent, Judge Anica Letica said she would affirm the trial court’s “well-reasoned and thorough orders.”

“The trial court’s consideration of an additional relevant factor was clearly stated and justified,” she noted. “The trial court did not hold that Dr. Krebs was not entitled to contractual attorney fees; it held that he was entitled to fees, but that the reasonable amount of fees was $0. Although adjusting an attorney-fee award from a baseline figure of $227,273.48 to $0 is extreme, under the specific facts of this case, this was not an unreasonable result in order to avoid an unjust windfall to Dr. Krebs.”

‘Pirgu’

Krebs argued that the trial court shouldn’t have applied Pirgu v. United Servs Auto Ass’n because that case involved the reasonableness of attorneys’ fees awarded by statute or court rule and the instant case involves a contractual fee-shifting provision.

The majority disagreed.

“[T]he language of the parties’ contract provides for reasonable attorney fees, and there is no reason not to apply Pirgu in the context of the contractual fee-shifting provision at issue in this case,” the judges wrote.

Here, the employment contract said the prevailing party is entitled to “reasonable attorneys’ fees.”

“The contract offers no greater specificity, and nothing in the contractual language indicates that a nonstandard framework to determine the reasonableness of attorney fees should apply,” the majority noted.

Law-of-the-case doctrine

However, the judges said it was an abuse of discretion for the trial court to apply the “additional relevant factors” prong of its Pirgu analysis “as a backdoor method of relitigating the issue” of whether the employment contract had been assigned to GLEI.

“For years the driving question in this lawsuit was whether Krebs’s contract had been assigned to GLEI, and in Krebs II , this Court decided once and for all that the answer to that question was no ,” they wrote, adding that “GLEI’s attempt to relitigate this closed question is exactly the sort of tactic that the law-of-the-case doctrine was constructed to foreclose.”

The trial court was ordered on remand to reinstate the award of $227,273.48, plus additional reasonable attorneys’ fees accrued during this appeal.

The decision is Great Lakes Eye Inst. PC v. Krebs ( MiLW 08-107797 ). The story was published on April 3.

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Easement error: Backlot owners’ beach, lake access is matter for trial

A Michigan Court of Appeals panel overruled a trial court’s decision in a dispute over beach access when it found that backlot property owners established entitlement to access the beach via prescriptive easement.

The trial court correctly concluded that the plaintiffs’ express easements did not give them full riparian rights, saying they may only use these easements to swim and to temporarily place small boats in the water.

“However, the trial court did err by concluding that plaintiffs have a right to access the shared beach and to place boats and docks in the water via prescriptive easement,” the panel wrote. “Accordingly, defendants have properly established that the court erred by granting summary disposition to plaintiffs under MCR 2.116(I)(2). Whether and to what extent plaintiffs have established access to the lake or the beach via prescriptive easement is a matter for trial.”

Prescriptive easement

“The crux of the matter at hand concerns the trial court’s handling of whether plaintiffs established entitlement to access to the beach via prescriptive easement,” the panel explained. “The trial court ruled in favor of plaintiffs under MCR 2.116(I)(2). We hold that this was error.”

The judges pointed out that the plaintiffs failed to establish that they used the shared beach in a hostile or adverse manner for the required 15-year period.

“Neither plaintiffs nor defendants have presented any evidence to prove their claims that would not require the court to weigh evidence or assess witness credibility, which is plainly disallowed at the summary disposition stage,” the panel wrote.

It is for a jury to decide matters of credibility and the weight to be given to the evidence.

“Here, even if we accepted plaintiffs’ averments in their depositions and affidavits as true, and made all reasonable inferences in their favor as the nonmoving parties, we could still draw opposing inferences about the nature and extent of plaintiffs’ use of the beach and their placement of docks on their 10-foot easements based on defendants’ testimony,” the panel wrote. “Accordingly, where record evidence would permit reasonable minds to differ regarding whether plaintiffs have established the right to access the shared beach or place docks and boats in the water via prescriptive easement, summary disposition was inappropriate.”

Riparian rights

The judges rejected the plaintiffs’ argument that their 10-foot express easements include the right to moor boats or put docks in the water.

To determine the scope of the easement, the court had to resolve the intent of the parties when the easement was created by looking at the easement’s plain language.

“Although each of the easements appears to give plaintiffs some degree of access to the lake, nothing in the express terms of the easements or the plat dedication indicates that the VanDusens, who originally owned the properties and included the easement in each deed, intended to grant plaintiffs full riparian rights, equal to the riparian rights granted to defendants as lakefront cottage owners,” the judges wrote.

The decision is Bloomquist v. DePree ( MiLW 08-107799 ). The story was published on April 9.

May

No-fault act doesn’t cap expenses where policy had no limits

A trial court erred by ruling that the no-fault act capped the number of hours an insured was entitled to because the insured’s automobile insurance policy provided for unlimited allowable expenses, including attendant care, a panel of the Michigan Court of Appeals held, reversing a grant of partial summary disposition in favor of the insurer.

“[The insured] selected boundless and infinite coverage for allowable expenses, which included attendant care,” the panel pointed out. “The policy did not list any exceptions.”

Policy language clear, unambiguous

In 2019, the Michigan Legislature made sweeping changes to the no-fault statutes with two bills that affected MCL 500.3157 , the judges explained.

The default restrictions for attendant care benefits are contained within MCL 500.3157(10) and set a statutory maximum of 56 hours per week.

However, MCL 500.3157(11) contains an exception to the default cap, providing that “[a]n insurer may contract to pay benefits for attendant care for more than the hourly limitation under subsection (10).”

This provision is in keeping with Michigan law allowing for insurance policies to provide broader coverage than the minimum mandated by the no-fault act, the court said.

Another tweak to the statute made in 2019 was MCL 500.3107c, which allows insurers to now offer less-than unlimited PIP coverage, provided certain statutory requirements are satisfied. The provision provides four possible coverage amounts, ranging from $50,000 per individual to unlimited coverage.

Here, the parties disputed the meaning of Terry’s selection of “unlimited person primary.” Terry took the position that this unlimited selection meant that he opted for unlimited attendant care hours, contracting around the default cap within MCL 500.3157(10).

In contrast, the insurer backed by the trial court found that Terry’s unlimited selection merely meant that he was choosing an unlimited dollar amount for purposes of MCL 500.3107c.

The appeals court acknowledged “some merit” to the trial court’s interpretation of both the policy and the no-fault act, which would result in an insured selecting an unlimited dollar amount while still being restricted to 56 hours of attendant care per week.

However, the judges disagreed due to the specific language of Terry’s policy.

“The policy explicitly listed ‘Allowable Expenses (Medical),’ which explicitly included attendant care, and Terry selected unlimited coverage,” the court wrote. “This was not a situation in which Terry selected a mere unlimited dollar amount for PIP coverage and later sought to extrapolate this to attendant care.”

Rather, Terry selected “boundless and infinite coverage” for allowable expenses, which included attendant care, with no exceptions listed in the policy.

“The policy in the present case was clear and unambiguous in its language,” the court said, noting that the trial court focused too much on the statute rather than the policy language.

Insurers could take steps to avoid similar outcomes in the future, the appellate judges added.

Nothing about Terry’s interpretation prevented future parties from allowing for unlimited PIP benefits in terms of the dollar amount while still restricting attendant care hours to 56 hours per week.

“To avoid the result in the present case, insurers must simply not allow insureds to select unlimited allowable expenses,” the panel explained. “Insurers could also simply include a provision explicitly providing that unlimited coverage does not include attendant care hours.”

The trial court’s ruling disrupted the principle that parties may contract for broader coverage than what the no-fault act mandates, the judges said.

“[T]he policy provided that it would pay PIP benefits under the no-fault act unless the policy’s language provided otherwise,” they wrote. “This yet again reflects the ability for parties to contract for broader coverage than that required by the statute. Here, the parties did so, and the trial court erred by ruling otherwise. [The insurer] was not entitled to partial summary disposition on the issue of Terry’s attendant care claims because Terry was not limited to 56 hours per week.”

The published per curiam decision is Smejkal v. Beck ( MiLW 07-107912 ). The story was published May 3.

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: Photo by Wirestock

Tigers strike out on former employee’s age bias claim

A federal court ruled against the Detroit Tigers Inc. in a longtime employee’s age discrimination lawsuit.

The baseball organization said it terminated the employee who had worked for the Tigers for 42 years for a legitimate and unrebutted nondiscriminatory reason: poor performance.

But U.S. District Judge David M. Lawson of the Eastern District of Michigan noted that the employee’s performance evaluations showed improved performance and compliments from his supervisor.

“There is plenty of evidence in this record from which a jury could conclude that [plaintiff’s] age was the reason he was fired,” the judge said.

Prima facie case

Four elements are required to show a prima facie case of age discrimination: membership in a protected group; qualification for the job; an adverse employment action; and circumstances that support an inference of discrimination. The Tigers organization acknowledged that Nelson satisfied the first and third elements.

“The defendant attempts to cast Nelson’s supposed performance failures as negating his showing on the second element that he was qualified for the job,” Lawson wrote. “However, there are substantial questions of fact about the plaintiff’s job performance in 2021 when he was let go, and in any case other evidence in the record suffices to suggest that the plaintiff amply was qualified for the job of Visiting Clubhouse Manager.”

There was no dispute that Nelson held that role for nearly three decades. That was enough to establish a question of fact as to whether he was qualified to perform the job.

“The defendant has not identified any other objective criteria for the position that the plaintiff did not satisfy in 2021, and it is not identified any way in which the objective qualifications for the job had evolved during the plaintiff’s tenure so as to render him unqualified to continue in the position,” Lawson noted.

The judge then rejected the Tigers’ challenge to the fourth element.

“[T]he plaintiff’s evidence that he was replaced by his former subordinate who was 24 years younger at the time suffices to raise such an inference,” Lawson said. “It is undisputed here that Dan Ross was promoted immediately after plaintiff’s termination to fill the vacant position. It is also undisputed that Ross was more than two decades younger than the plaintiff when he was promoted.”

Performance reviews

While the Tigers cited poor performance as the reason for the firing, Nelson presented evidence that it had no basis in fact sufficient to put to a jury whether his supposed performance deficiency in 2021 was grounded in fact.

“The record evidence shows that Nelson received glowing performance reviews in 2019 and 2020, which reflected no hint of the poor performance that gave rise to complaints compiled by the 2017 MLB Clubhouse Survey and noted in the plaintiff’s disparaging 2017 and 2018 performance reviews,” Lawson wrote. “The 2019 and 2020 evaluations suffice to raise a question about whether, as the defendant contends, the plaintiff had failed to improve his performance over the ensuing three years.”

Here, the judge said Nelson offered “sufficient evidence to allow a jury to conclude that he achieved a dramatic turnaround in his performance from 2017 to 2020, to the point that his work was deemed, ‘Fully Satisfactory’ in his last written review, and that the supposed failure of performance in 2020 and 2021 in fact never occurred.”

Lawson denied the defendant’s motion for summary judgment.

The decision is Nelson v. Detroit Tigers Inc. ( MiLW 02-107884 ). The story was published May 15.

June

Insurer can deny PIP benefits for false statements during discovery

False statements submitted during discovery after a lawsuit for no-fault benefits has been filed may be statements offered in support of a claim to the assigned insurer or the Michigan Automobile Insurance Placement Facility, or MAIPF, the Michigan Supreme Court held.

“This case presents an issue of first impression: whether MCL 500.3173a(4) applies to misrepresentations made during discovery in the course of litigation,” Justice Elizabeth M. Welch wrote. “The Court of Appeals’ opinion [] established a categorical rule that MCL 500.3173a(4) applies to prelitigation statements only. We find this rule to be overly broad and therefore reverse and remand for further proceedings.”

Prior proceedings

The Court of Appeals reversed the trial court’s grant of summary disposition for AAA in a 2022 published decision .

“False statements submitted during discovery, after an action for recovery has been filed, are not statements offered in support of a claim to the MAIPF or the assigned insurer,” Judge Kristina Robinson Garrett, joined by Judges Douglas B. Shapiro and Michelle M. Rick, explained. “The no-fault act recognizes a distinction between the prelitigation insurance claims process and the initiation of litigation through an action for recovery.”

After an action for recovery has been filed, false statements submitted during discovery are not statements offered in support of a claim to the MAIPF or the assigned insurer, the judge said.

This conclusion was reinforced when considering the entirety of MCL 500.3173a, which concerns a claimant’s eligibility for PIP benefits and the denial of benefits revealing that the legislature intended for the statute to apply to the prelitigation claims process, not to evidence submitted for the first time during litigation, Garrett said.

“Here, the attendant care and replacement service forms were not submitted in support of Williamson’s claim for no-fault benefits that he submitted to the MAIPF or to AAA,” she noted. “Rather, the forms were disclosed during discovery after the claim was submitted to the MAIPF, assigned to AAA, denied by AAA, and litigation had ensued. MCL 500.3173a(4) asks whether the allegedly false statement was ‘part of or in support of a claim to the [MAIPF], or to an insurer to which the claim is assigned under the assigned claims plan.’ But a false statement made in a filing submitted during discovery is not a statement made to the MAIPF or to an assigned insurer. Rather, a false statement made during discovery is made to the court.”

AAA filed an application for leave to appeal, which the Michigan Supreme Court granted. The justices directed the parties to address “whether MCL 500.3173a(4), the statutory provision governing fraudulent insurance acts in the filing of a claim for no-fault benefits, applies to misrepresentations offered during discovery.”

Reversed and remanded

Welch said the Court of Appeals erred when it held that held that “only prelitigation statements can constitute statements in support of a claim under MCL 500.3173a(4).”

A statement must be “part of or in support of a claim to the [MAIPF], or to an insurer to which the claim is assigned under the assigned claims plan, for payment or another benefit” to be a fraudulent insurance act under the statute.

“Claim” is not defined in no-fault act and the court has not defined it in the context of MCL 500.3173a . However, caselaw provided guidance, Welch said.

For example, the high court held in Covenant Med Ctr, Inc v. State Farm Mut Auto Ins Co that “[t]he relevant dictionary definitions of ‘claim’ include ‘a demand for something due or believed to be due’ and ‘a right to something.’”

The court also ruled in Griffin v. Trumbull Ins Co that “a claim for benefits is simply a demand to an insurer by its insured or a third party for payments that are believed to be due after a motor vehicle accident.”

Thus, “claim” refers generally to a claimant’s demand for coverage under the MACP for bodily injury suffered in a motor vehicle accident in the context of MCL 500.3173a.

Applying these definitions to the case at bar, it follows that the Estate’s interrogatory answers which indicated that the Estate sought no-fault benefits for services rendered after Williamson passed away were in support of a demand for coverage under the MACP based on bodily injury sustained in a motor vehicle accident,” Welch wrote. “There is no other conceivable reason why the Estate would have supplied the answers it did.”

Noting that many plaintiffs in no fault cases seek continuing care benefits during litigation against an insurer, the justice said the appellate court’s “overbroad rule suggests that once litigation commences, MCL 500.3173a(4) would no longer penalize fraudulent statements aimed at obtaining benefits sought while litigation is ongoing. Nothing in the statute suggests that the Legislature desired such a result.”

The justices reversed and remanded to the Court of Appeals to address the remaining unresolved issues, including the plaintiff’s alternative arguments “that AAA failed to satisfy the intent and materiality prongs for a fraudulent insurance act under MCL 500.3173a(4), or that AAA failed to plead the affirmative defense of fraud with sufficient particularity.”

The unanimous decision is Williamson v. AAA of Michigan ( MiLW 06-108092 , 12 pages). The full story was published June 24.

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