Contempt of Calcutt, In re
| Decision Date | 05 September 1990 |
| Docket Number | Docket No. 119430 |
| Citation | 184 Mich.App. 749,458 N.W.2d 919 |
| Parties | In re CONTEMPT OF CALCUTT. Billy CALCUTT, Plaintiff-Appellee, v. HARPER GRACE HOSPITALS, Defendant, and Gary Hinkle, as Executor of the Estate of Marilyn J. (Hinkle) Calcutt, Third-Party Defendant-Appellant. 184 Mich.App. 749, 458 N.W.2d 919 |
| Court | Court of Appeal of Michigan — District of US |
[184 MICHAPP 751] Randall M. Wokas, Washington, D.C., for himself and Billy calcutt.
Jack C. Chilingirian, St. Clair Shores, for Gary Hinkle.
Before WAHLS, P.J., and GRIBBS and SULLIVAN, JJ.
This is a contempt of court proceeding which is ancillary to an appeal as of right by Gary Hinkle from a July 21, 1989, Wayne Circuit Court order which granted Billy Calcutt's motion for summary disposition. The order awarded Calcutt[184 MICHAPP 752] a fund consisting of approximately $180,000 in health insurance proceeds which was on deposit with the trial court in an interpleader action. On Hinkle's motion, we ordered the proceedings in the trial court stayed and the fund of insurance proceeds returned pending the outcome of Hinkle's appeal. We now find Calcutt and his attorney, Randall Wokas, in contempt of this Court for disobeying this Court's order and remand this case to the trial court for proceedings consistent with this opinion.
On July 26, 1989, five days after summary disposition was entered, Hinkle filed an appeal in this Court and gave notice to Calcutt and Wokas. On July 31, 1989, ten days after the entry of summary disposition, Wokas had the fund of insurance proceeds withdrawn from the court on Calcutt's behalf. Hinkle was not notified of the withdrawal. On August 4, 1989, only fourteen days after summary disposition was entered, Hinkle filed a motion in the trial court for a stay of proceedings during the pendency of the appeal. Hinkle requested that the fund of insurance proceeds remain in the court's custody and that the fund, plus an additional sum of money, constitute Hinkle's bond on appeal. On August 11, 1989, twenty-one days after summary disposition was entered, Calcutt responded that he had already withdrawn the fund from the court. On August 16, 1989, twenty-six days after summary disposition was entered, Hinkle amended his motion to allege that Calcutt had withdrawn the fund contrary to MCR 2.614(A) which provides an automatic stay of proceedings for twenty-one days after entry of an order. Hinkle requested the court to order that the fund be returned.
[184 MICHAPP 753] A hearing on Hinkle's motion was originally scheduled for August 18, 1989, but was adjourned by the trial court. Hinkle did, however, manage to schedule an emergency conference with the court for August 22, 1989. At that time, the court stated it was not ready for a hearing on Hinkle's motion.
On September 15, 1989, a hearing was finally held on Hinkle's motion. However, the court took the matter under advisement for another month until October 18, 1989, when it entered an order denying Hinkle's motion. Although the court found that "it is undisputed that [Calcutt] executed on the judgment prior to the 21-day expiration [sic] period" in violation of MCR 2.614(A), the court believed that the issue was rendered moot by its ultimate decision to deny Hinkle's motion for a stay of proceedings.
Hinkle sought immediate review in this Court of the trial court's decision to deny a stay on appeal. MCR 2.614(F) and 7.209. As indicated above, we entered an order on November 27, 1989, granting Hinkle's motion for a stay and ordering the return of the fund.
On December 6, 1989, Hinkle filed a petition in this Court to hold Wokas and Calcutt in contempt of court because Wokas had indicated that he and Calcutt were not going to comply with this Court's order to return the fund. On December 18, 1989, Wokas filed a motion requesting an extension of time to respond because "Calcutt no longer resides in ... Michigan, and [Wokas] has ... been unable to secure Calcutt's assistance in the preparation of a response." On behalf of himself, Wokas claimed that he "does not have in his possession, custody, or control any funds belonging to Calcutt, nor does he hold any funds in trust for Calcutt, and hence, he cannot place said funds in an interest bearing account."
[184 MICHAPP 754] On December 26, 1989, this Court denied Wokas' motion for an extension and, on the basis of Hinkle's petition to hold Wokas and Calcutt in contempt, ordered that "[s]aid plaintiffs [sic] shall personally appear in [this Court] on Friday, February 2, 1990, to explain why they are not in contempt of this Court." On February 1, 1990, Wokas filed a response on behalf of Calcutt in which Calcutt claimed that MCR 2.614 was not violated. Wokas claimed that, since there had been no court order or rule restraining Calcutt, Calcutt had been free to spend the entire fund as he wished, and, since Calcutt had spent the entire fund, Calcutt cannot be held in contempt for not obeying this Court's order. On his own behalf, Wokas claimed that he was ethically "obliged to deliver the funds" to Calcutt, and that he did not have any part of the fund. However, Wokas "did earn and has been paid a reasonable hourly attorney fee ... in connection with [this case]."
Wokas and Calcutt appeared at the hearing in this Court on February 2, 1990. On behalf of Calcutt and himself, Wokas detailed the defenses outlined above and explained his and Calcutt's actions in this matter. Among other things, Wokas also informed this Court for the first time that he disbursed the fund from his client trust account to himself and Calcutt on August 21, 1989, the day before the emergency conference in the trial court on Hinkle's motion. This Court took the matter under advisement and adjourned after a full hearing.
[184 MICHAPP 755] The issue of whether the automatic stay of MCR 2.614 was violated is not dispositive of the main issue of whether Wokas and Calcutt are in contempt of this Court, but it does merit discussion. MCR 2.614(A)(1) provides:
Except as provided in this rule, execution may not issue on a judgment and proceedings may not be taken for its enforcement until the expiration of 21 days after its entry. If a motion for new trial, a motion to alter or amend the judgment, a motion for judgment notwithstanding the verdict, or a motion to amend or for additional findings of the court is filed and served within 21 days after entry of the judgment, execution may not issue on the judgment and proceedings may not be taken for its enforcement until the expiration of 21 days after the entry of the order on the motion, unless otherwise ordered by the court on motion for good cause. Nothing in this rule prohibits the court from enjoining the transfer or disposition of property during the 21-day period.
The purpose of the automatic stay is to preserve the status quo during the period an aggrieved party has to file posttrial motions or an appeal. Martin, Dean & Webster, Michigan Court Rules Practice, Rule 2.614, comment 1, pp 637-639. Exceptions to the automatic stay are provided in MCR 2.614(A)(2); none of them apply to this case. Hinkle properly relied on the automatic stay preventing Wokas and Calcutt from recovering the fund while Hinkle took steps to perfect his appeal and obtain a stay of proceedings pending his appeal in this Court.
Wokas and Calcutt violated MCR 2.614(A)(1) when they recovered the fund from the clerk during the twenty-one-day automatic stay. See[184 MICHAPP 756] Clinton Twp. v. Mt. Clemens, 171 Mich.App. 288, 292-293, 429 N.W.2d 656 (1988), lv. den. 432 Mich. 884 (1989); Lyons v. Lyons, 125 Mich.App. 626, 630-631, 336 N.W.2d 844 (1983). It is entirely irrelevant that, accepting Wokas' claim, Wokas would not have removed the fund if the trial court's clerk had not called Wokas and inquired about removing the fund. Wokas was aware of the court rule and should have obeyed it. Cf. Lyons, supra.
Stay on appeal is governed by MCR 7.209, which provides for a stay of execution upon the filing of a bond. MCR 7.209(H). In this case, the fund on deposit with the court clerk in an interest-bearing account, plus a minimal additional sum from Hinkle, would have been a satisfactory bond. MCR 7.209(G); MCR 3.604(K); M.C.L. Sec. 600.2631; M.S.A. Sec. 27A.2631. Also, "[a] bond in a civil action need not be approved by a court or clerk before filing but is subject to the objection procedure provided in MCR 3.604." MCR 7.209(G)(1). Therefore, by proceeding in the manner he did within the twenty-one-day stay period provided in MCR 2.614(A)(1), Hinkle could have effectively perpetuated the stay until his motion for a stay was decided, and the bond approved or disapproved by the trial court. MCR 7.209. It appears that only Wokas' improper removal of the fund on behalf of Calcutt prevented Hinkle from perpetuating the stay.
Attorneys and parties to actions are obliged to obey this Court's lawful orders, even if erroneous, until the orders are reversed. Rose v. Aaron, 345 Mich. 613, 615, 76 N.W.2d 829 (1956); Schumacher v. Tidswell, 138 Mich.App. 708, 722, 360 N.W.2d 915 (1984). The Legislature vested this Court with the power to punish attorneys and parties to actions [184 MICHAPP 757] for contempt of this Court for disobedience of its orders. See M.C.L. Sec. 600.1701 et seq.; M.S.A. Sec. 27A.1701 et seq.; see also Const.1963, art. 6, Sec. 10; People v. Cooke, 419 Mich. 420, 430, 355 N.W.2d 88 (1984).
Contempt proceedings for contempts committed outside the immediate view and presence of this Court should be initiated on ex parte motion supported by an...
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