Estate of Voutsaras by Gaydos v. Bender

• Decision Date: 03 January 2019
• Docket Number: No. 340714,340714
• Citation: 326 Mich.App. 667,929 N.W.2d 809
• Parties: ESTATE OF Diana Lykos VOUTSARAS, BY Kathleen M. GAYDOS, Personal Representative, Plaintiff-Appellant, and Spiro Voutsaras, Plaintiff, v. Gary L. BENDER, Richard A. Cascarilla, Lindsay Nicole Dangl, Vincent P. Spagnuolo, and Murphy & Spagnuolo P.C., Defendants, and Kenneth M. Mogill, Mogill Posner & Cohen, Kern G. Slucter and Gannon Group, P.C., Defendant-Appellees.
• Court: Court of Appeal of Michigan — District of US

326 Mich.App. 667

929 N.W.2d 809

ESTATE OF Diana Lykos VOUTSARAS, BY Kathleen M. GAYDOS, Personal Representative, Plaintiff-Appellant,andSpiro Voutsaras, Plaintiff,

v. Gary L. BENDER, Richard A. Cascarilla, Lindsay Nicole Dangl, Vincent P. Spagnuolo, and Murphy & Spagnuolo P.C., Defendants,andKenneth M. Mogill, Mogill Posner & Cohen, Kern G. Slucter and Gannon Group, P.C., Defendant-Appellees.

No. 340714

Court of Appeals of Michigan.

Submitted December 11, 2018, at Lansing

Decided January 3, 2019, 9:05 a.m.

The Gallagher Law Firm PLC (by Byron P. Gallagher, Jr., and Samuel A. Lusk), Lansing, for Kathleen M. Gaydos, as personal representative of the estate of Diana Lykos Voutsaras.

Maddin Hauser Roth & Heller, PC (by Kathleen H. Klaus and Jesse L. Roth ), Southfield, for Kenneth Mogill and Mogill Posner & Cohen.

Fahey Schultz Burzych Rhodes PLC (by John S. Brennan ), Okemos, for Kern G. Slucter and Gannon Group, PC.

Before: Swartzle, P.J., and Sawyer and Ronayne Krause, JJ.

Ronayne Krause, J. Plaintiff-appellant, the estate of Diana Lykos Voutsaras (the Estate) appeals as of right the trial court’s order granting summary disposition in favor of defendants Kenneth M. Mogill, Mogill Posner & Cohen, Kern G. Slucter, and Gannon Group, P.C. (collectively, the Mogill defendants).¹ This appeal arises, in relevant part, out of the Estate’s action against the Mogill defendants for professional malpractice in their services as expert witnesses. The trial court held that a party’s own expert witnesses, regardless of any duty to their client, are shielded by witness immunity. We hold that licensed professionals owe the same duty to the party for whom they testify as they would to any client and that witness immunity is not a defense against professional malpractice. Therefore, we reverse and remand.

I. STATEMENT OF FACTS

The underlying litigation involved the foreclosure of a commercial mortgage and note made by Diana and Spiro Voutsaras and held by Gallagher Investments (Gallagher). The Voutsarases hired the law-firm defendants² to represent them in the foreclosure proceedings. The Voutsarases, on the advice of the law-firm defendants, filed a counterclaim against Gallagher and a third-party claim against some of the principal actors involved with Gallagher for malpractice. The law-firm defendants then hired the Mogill defendants to provide litigation support and ultimately serve as expert witnesses at trial. Kenneth Mogill was considered to be a preeminent authority on legal ethics in the state of Michigan, and Slucter and Gannon Group were experts in the field of real-estate brokerage and best practices in the field. Ultimately the law-firm defendants informed the Voutsarases that their litigation strategy was bound to fail, and the trial court granted summary disposition against the Voutsarases.

Diana Voutsaras passed away in January 2015, and the Estate then brought the present action against the law-firm defendants and the Mogill defendants. The Estate claimed that the law-firm defendants failed to advise Diana Voutsaras of a favorable settlement offer and that the law-firm defendants deliberately concealed the fact that the Voutsarases’ claims were frivolous in order to drive up their costs before trial. The Estate claimed that the Mogill defendants breached their duty to Diana Voutsaras by failing to properly investigate the facts required to formulate their opinions, failing to understand the applicable standards, and failing to provide a competent professional opinion. Noting that the ability to sue one’s own expert witnesses was an issue of first impression in Michigan, the trial court engaged in a broad reading of prior witness-immunity standards and granted summary judgment to the Mogill defendants on that theory. This appeal followed.

II. PRESERVATION AND STANDARD OF REVIEW

A. PRESERVATION OF THE ISSUE

An issue is preserved for appellate review if raised in the trial court and pursued on appeal. Peterman v. Dep’t of Natural Resources , 446 Mich. 177, 183, 521 N.W.2d 499 (1994). The Estate argued that whether a party may sue his or her own expert witness was an issue of first impression in Michigan and that the trial court should follow caselaw from sister state courts on that matter. The trial court agreed that this issue was an open question in Michigan but determined that defendant Mogill was entitled to witness immunity because that doctrine is broadly construed and because the policy considerations underlying the doctrine would be advanced by its application in this case. The issue is preserved.

B. STANDARD OF REVIEW

This Court reviews de novo a trial court’s decision to grant summary disposition.

Bowden v. Gannaway , 310 Mich.App. 499, 503, 871 N.W.2d 893 (2015). A court may grant summary disposition under MCR 2.116(C)(7) "because of ... immunity granted by law ...." "A party may support a motion under MCR 2.116(C)(7) by affidavits, depositions, admissions, or other documentary evidence." Maiden v. Rozwood , 461 Mich. 109, 119, 597 N.W.2d 817 (1999). This Court also reviews de novo the applicability of legal doctrines, Husted v. Auto-Owners Ins. Co. , 213 Mich.App. 547, 555, 540 N.W.2d 743 (1995), aff’d 459 Mich. 500, 591 N.W.2d 642 (1999), and claims of immunity, Denhof v. Challa , 311 Mich.App. 499, 510, 876 N.W.2d 266 (2015).

III. ARGUMENT

A. DUTY OF AN EXPERT WITNESS WHO IS A LICENSED PROFESSIONAL

The Estate claims that defendants owed to Diana Voutsaras a legal duty and that defendants breached that duty. Duty is "the legal obligation to conform to a specific standard of conduct in order to protect others from unreasonable risks of injury." Lelito v. Monroe , 273 Mich.App. 416, 419, 729 N.W.2d 564 (2006). As will be discussed further, our decision in this matter is limited to a claim of professional malpractice, which "arises from the breach of a duty owed by one rendering professional services to a person who has contracted for those services ... predicated on the failure of the defendant to exercise the requisite professional skill." Broz v. Plante & Moran, PLLC , 326 Mich.App. 528, 535–37, 928 N.W.2d 292 (2018). "Generally, to state a claim for malpractice, a plaintiff must allege (1) the existence of a professional relationship, (2) negligence in the performance of the duties within that relationship, (3) proximate cause, and (4) the fact and extent of the client’s injury." Id . at 537–38, 928 N.W.2d 292.

The trial court granted summary disposition to defendants solely on the basis of witness immunity. Defendants now argue on appeal that regardless of witness immunity, the Estate has failed to show that defendants owed a legal duty to Diana Voutsaras. "An issue not addressed by the trial court may nevertheless be addressed by the appellate court if it concerns a legal issue and the facts necessary for its resolution have been presented." Sutton v. Oak Park , 251 Mich.App. 345, 349, 650 N.W.2d 404 (2002). We are not satisfied that this record presents us with the facts necessary to resolve this issue. Nevertheless, we presume for the sake of argument that defendants are subject to claims for professional malpractice by the Estate and breached their professional duties to Diana Voutsaras. However, we do not decide those questions, and we leave for the trial court to determine in the first instance whether, in fact, defendants owed or breached a legal duty to Diana Voutsaras. We address only whether defendants are immune from liability related to that duty, if any.

B. WITNESS IMMUNITY AS A DEFENSE TO MALPRACTICE

1. MICHIGAN CASELAW

Defendants and the trial court rely on our Supreme Court’s opinion in Maiden , 461 Mich. at 109, 597 N.W.2d 817, for the proposition that all witnesses enjoy total immunity for any relevant testimony provided during judicial proceedings. Our Supreme Court observed that "the duty imposed on a witness is generally owed to the court, not the adverse party," so a breach of that duty "does not give rise to a cause of action in tort by the adverse party." Id . at 133-134, 597 N.W.2d 817. Our Supreme Court continued:

[W]itnesses who testify during the course of judicial proceedings enjoy quasi-judicial immunity. This immunity is available to those serving in a quasi-judicial adjudicative capacity as well as "those persons other than judges without whom the judicial process could not function." 14 West Group’s Michigan Practice, Torts, § 9:393, p 9–131. Witnesses who are an integral part of the judicial process "are wholly immune from liability for the consequences of their testimony or related evaluations." Id ., § 9:394, pp. 9-131 to 9-132, citing Martin v. Children’s Aid Society , 215 Mich.App. 88, 96, 544 N.W.2d 651 (1996). Statements made during the course of judicial proceedings are absolutely privileged, provided they are relevant, material, or pertinent to the issue being tried. See Martin v. Children’s Aid Society , supra ; Rouch v. Enquirer & News of Battle Creek , 427 Mich. 157, 164, 398 N.W.2d 245 (1986) ; Meyer v. Hubbell , 117 Mich.App. 699, 709, 324 N.W.2d 139 (1982) ; Sanders v. Leeson Air Conditioning Corp , 362 Mich. 692, 695, 108 N.W.2d 761 (1961). Falsity or malice on the part of the witness does not abrogate the privilege. Sanders , supra . The privilege should be liberally construed so that participants in judicial proceedings are free to express themselves without fear of retaliation. Id . [ Maiden , 461 Mich. at 134, 597 N.W.2d 817.]

We find Maiden only partially applicable, for several reasons.

First, the policy considerations in Maiden were clearly focused on the freedom witnesses must have to give damaging testimony without any fear of possible reprisal. We agree with defendants and the trial court to the extent that such policy considerations extend beyond witnesses who are formally or functionally adverse. In other words, any witness called by any party enjoys immunity based on the substance of that witness’s testimony or evidence. Therefore, to the extent...