Beninati Contracting Serv. Inc v. Vip Co.
| Decision Date | 19 April 2011 |
| Docket Number | No. 296218,296218 |
| Parties | BENINATI CONTRACTING SERVICES, INC., Plaintiff-Appellee, v VIP COMPANY and JOSEPH Z. ORAM, Defendants, and M-59 JOY, L.L.C., Defendant-Appellant. |
| Court | Court of Appeal of Michigan — District of US |
UNPUBLISHED
Macomb Circuit Court
Before: Gleicher, P.J., and Sawyer and Markey, JJ.
Defendant M-59 Joy, L.L.C. ("M-59"), appeals as of right from a default judgment for $76,706, entered in favor of plaintiff Beninati Contracting Services, Inc. ("Beninati"), after M-59's agent, defendant Joseph Oram, failed to appear for trial. We affirm.
In October 2006, M-59 and Beninati entered into a contract for Beninati to remove and chip trees and stumps from property in Mount Clemens. The contract required Beninati to haul away the wood chips, root rake clearing areas, and rough grade dirt piles on the property. In October 2007, Beninati filed a claim of construction lien in the amount of $46,590.79 with the Macomb County Register of Deeds. The next year, on October 10, 2008, Beninati filed this instant action to recover $46,590.79 from M-59, plus accrued interest and other permissible collection costs, under various contract, tort, and equitable theories of liability. Beninati also sought to foreclose on the construction lien. Beninati also alleged that defendants Oram and VIP Company could be held liable as alter egos of M-59.
In July 2009, the trial court dismissed defendants Oram and VIP Company after finding no basis for imposing liability on them for M-59's alleged liability. M-59 thereafter retained new counsel, who unsuccessfully moved to amend the pleadings to modify M-59's affirmative defenses and to file a four-count counter-complaint against Beninati.1 After Oram failed to appear for the scheduled trial on January 12, 2010, the trial court granted Beninati's motion for a default against M-59. The court thereafter conducted an evidentiary hearing to determine damages. At the hearing, Beninati relied on the written contract between the parties, as orally modified, and also offered evidence of lost profits from wood chip revenue. The trial court awarded Beninati damages of $76,706 and entered a default judgment that also permitted Beninati to seek foreclosure remedies, if applicable.
On appeal, M-59 first argues that the trial court abused its discretion by imposing the sanction of default based on Oram's failure to appear at the scheduled trial. M-59 argues that the trial court erred by failing to consider other, less drastic sanctions, before imposing the severe sanction of a default. M-59 argues that its counsel made diligent efforts to produce Oram as a witness for trial, but that a default was inappropriate in any event because it, as a corporation, was distinct from Oram, who was only a witness.
First, the fact that M-59, and not Oram, was the only remaining party defendant is immaterial because the trial court relied on MCR 2.506(F) as authority for entering a default against M-59. That rule provides six possible sanctions where "a party or an officer, director, or managing agent of a party fails to attend or produce documents or other tangible evidence pursuant to a subpoena or an order to attend." Sanctions under MCR 2.506(F) are directed at the party, see McGee v Macambo Lounge, Inc, 158 Mich App 282, 286-288; 404 NW2d 242 (1987), but a corporation may only act through its employees and agents. Upjohn Co v New Hampshire Ins Co, 438 Mich 197, 213-214; 476 NW2d 392 (1991); Mossman v Millenbach Motor Sales, 284 Mich 562, 568; 280 NW 50 (1938). The record establishes, and M-59 does not dispute, that Oram was its sole member and managing agent.
Next, while a trial court has discretion in ordering sanctions under MCR 2.506(F), Phillips v Deihm, 213 Mich App 389, 394; 541 NW2d 566 (1995), an abuse of discretion occurs only when the trial court's decision falls outside the range of reasonable and principled outcomes. Saffian v Simmons, 477 Mich 8, 12; 727 NW2d 132 (2007). Although there is authority recognizing that a trial court should carefully evaluate its options on the record before ordering a drastic sanction of dismissal or a default, see Vicencio v Ramirez, 211 Mich App 501, 506; 536 NW2d 280 (1995), that approach was derived from cases involving discoveryviolations. See id. at 506-507, and cases cited therein, including Houston v Southwest Detroit Hosp, 166 Mich App 623; 420 NW2d 835 (1987).
MCR 2.506(F) does not require an on-the-record consideration of the possible sanctions listed in the rule. Further, MCR 2.517(A)(4) does not require findings of fact or conclusions of law in decisions on motions unless required by a particular rule. In addition, this Court has upheld a dismissal sanction where the record clearly indicates that the trial court was aware of all relevant circumstances before ordering dismissal. See Bass v Combs, 238 Mich App 16, 35; 604 NW2d 727 (1999), overruled in part on other grounds Dimmitt & Owens Fin, Inc v Deloitte & Touche (ISC), LLC, 481 Mich 618, 628; 752 NW2d 37 (2008). More recently, in Oram v Oram, 480 Mich 1163; 746 NW2d 865 (2008), our Supreme Court applied the general abuse of discretion standard in reviewing a trial court's dismissal sanction against a party for failure to comply with a court order.
In this case, even considering M-59's arguments in light of the applicable court rule, MCR 2.506(F), we would not conclude that the trial court abused its discretion in ordering a default. While the trial court did not consider all available options on the record before ordering a default, the court was not unaware of the other available options in MCR 2.506(F). On the contrary, the trial court noted that the rule provided "among other things" for a default. The "dismissal" option in MCR 2.506(F)(5) was clearly inapplicable, and the options of striking all or part of M-59's pleadings or refusing to allow M-59 to support or oppose designated claims or defenses, see MCR 2.506(F)(3) and (4), had little relevance to the circumstances of this case, which involved a party's failure to attend the trial, and not a failure to produce particular documents or evidence.
The other options were to stay proceedings until the order is complied with or to tax costs, MCR 2.506(F)(1) and (2), but it is clear from the record that these options were presented to the trial court through the arguments of M-59's counsel. The record reflects that the trial court gave careful consideration to the reasons offered by M-59's counsel for Oram's nonappearance in concluding that a default was warranted. It is apparent that the court was not satisfied with counsel's explanation that he could take instructions from Oram, but was unable to secure his appearance at trial, and that it would not allow another adjournment, let alone one conditioned on the payment of costs. At the close of the hearing, the trial court discussed the prior adjournments in the case, found that M-59 should have been prepared for trial, and that the default was appropriate for Oram's failure to appear. Considering the record as a whole in light of the circumstances, the sanction of default was within the range of reasonable and principled outcomes and, accordingly, was not an abuse of discretion. Oram, 480 Mich at 1163; Saffian, 477 Mich at 12.
M-59 next challenges the evidence and writings offered by Beninati to establish damages, arguing that it did not comport with the statute of frauds applicable to a transfer of an interest in land. We conclude that this issue is insufficiently briefed to permit appellate review. M-59 does not identify the particular damages evidence that it believes constitutes a transfer of an interest in land within the meaning of MCL 566.106, or might constitute a contract for the sale of an interest in land within the meaning of MCL 566.108. M-59 argues only that the claim fordamages "manifested and exploited an interest in M-59's real property" and that the trial court "in error admitted parol and inadmissible evidence of Beninati's interest in M-59's land." An appellant may not leave it to this Court to search for factual support for a claim. McIntosh v McIntosh, 282 Mich App 471, 484-485; 768 NW2d 325 (2009). This Court need not address an issue that is given only cursory treatment in a brief, with little or no citation to supporting authority. Id. at 485. "The appellant himself must first adequately prime the pump; only then does the appellate well begin to flow." Mitcham v Detroit, 355 Mich 182, 203; 94 NW2d 388 (1959).
M-59 next argues that the trial court erred in awarding damages in excess of the $28,000 amount stated in the written contract, less a payment of $5,000 previously received by Beninati. M-59 correctly observes that the trial court's findings are reviewed for clear error, but it does not identify any particular finding that it alleges is clearly erroneous. M-59 also summarily asserts that attorney fees were improperly included in the damages award. However, contrary to M-59's suggestion that there was no authority for an award of attorney fees, the parties' written contract specifically provides that M-59 "will be responsible for any attorney and/or court costs involved in the collection of this debt." Attorney fees are recoverable as an element of damages when expressly allowed by contract. Marilyn Froling Revocable Living Trust v Bloomfield Hills Country Club, 283 Mich App 264, 297; 769 NW2d 234 (2009).
M-59 also argues that it had a right to have a jury determine damages. This issue is unpreserved because M-59 did not object to the absence of a jury at the hearing on damages. Walters v Nadell, 481 Mich 377, 387-388; 751 NW2d 431 (2008). Further, M-59 has not demonstrated that the failure to grant relief with respect to this unpreserved issue will result in a miscarriage of justice. Id.
A default operates as an admission of liability as to all well-pleaded allegations,...
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