FMB-First Mich. Bank v. Bailey, FMB-FIRST
| Decision Date | 24 November 1998 |
| Docket Number | FMB-FIRST,Docket No. 200958 |
| Citation | 232 Mich.App. 711,591 N.W.2d 676 |
| Parties | NATIONAL BANK, Plaintiff-Appellee, v. Donald M. BAILEY, Defendant/Third-Party PlaintiffAppellant, v. James L. Koetje, Bailey & Koetje, P.C., Wardrop & Wardrop, P.C., Schenk, Boncher & Prasher, P.C., Donald R. France and Thomas P. Jeakle, Third-Party Defendants--Appellees. |
| Court | Court of Appeal of Michigan — District of US |
Cunningham Dalman, P.C. (by Andrew J. Mulder and Gregory J. McCoy), Holland, for FMB-First Bank of Michigan.
Donald M. Bailey, Grand Rapids, for Donald M. Bailey.
James L. Koetje, Grandville, for James L. Koetje and Bailey and Koetje, P.C.
Smith, Haughey, Rice and Roegge (by L. Roland Roegge and Matthew L. Meyer), Grand Rapids, for Wardrop & Wardrop, P.C.
Schenk, Boncher & Prasher (by Gregory G. Prasher), Grand Rapids, for Schenk, Boncher & Prasher.
Law, Weathers & Richardson, P.C. (by Robert A. Buchanan), Grand Rapids, for Thomas P. Jeakle.
Before: SMOLENSKI, P.J., and McDONALD and SAAD, JJ.
This appeal is the most recent chapter in the tangled legal and financial affairs of the law firm Bailey & Koetje, P.C. (B & K). Before the firm's dissolution, each of the three partners personally guaranteed a portion of a loan made by plaintiff to B & K. Following the firm's dissolution, plaintiff attempted to collect the guaranteed amount. Although his two partners paid their share of the loan as required by the guarantee, defendant/third-party plaintiff, Donald M. Bailey (defendant) refused to pay, and plaintiff sued. Defendant sued the third-party defendants on a variety of common-law theories. On October 8, 1996, the trial court dismissed the third-party defendants on summary disposition. On January 14, 1997, the trial court ordered summary disposition in plaintiff's favor against defendant. Defendant now appeals as of right from both summary disposition orders, and also from an order awarding attorney fees to the third-party defendants under MCR 2.114(E) or (F). Because defendant Bailey's defense to the loan is wholly frivolous, as are his claims against third-party defendants, we affirm the summary disposition orders. The question of first impression raised by the sanctions assessed against defendant is whether a pro se litigant may be awarded attorney fees. We answer no because a pro se litigant has not incurred attorney fees as these terms are used in the relevant court rules and statute. However, we remand with instructions to the trial court to use its discretion under MCR 2.114(E) to formulate an appropriate sanction against defendant for frivolous litigation. 1
Defendant and third-party defendants James L. Koetje and Donald R. France were partners in the law firm Bailey & Koetje, P.C. On August 17, 1994, plaintiff, a bank, extended credit to B & K, documented by an unsecured demand note for $100,000. In connection with the loan, defendant, Koetje, and France each signed a guarantee that limited each signatory's liability to thirty percent of the total debt.
Koetje subsequently commenced a dissolution action against B & K. In the dissolution action, third-party defendant Wardrop & Wardrop, P.C. (W & W) represented B & K, and third-party defendant Schenk, Boncher & Prasher, P.C. (S, B & P) represented Koetje. In the dissolution action, the trial court appointed third-party defendant Thomas P. Jeakle as a special master to wind down B & K's affairs. 2 B & K has also been involved in bankruptcy proceedings in late 1995 and early 1996. On May 12, 1995, the trial court entered an order dissolving the corporation in accordance with an arbitration the court conducted at the parties' request.
On December 21, 1995, plaintiff demanded from B & K's partners payment of the amount each had guaranteed, including $23,189.32 from defendant. Koetje and France satisfied the obligation, but defendant refused to pay. Plaintiff commenced this lawsuit on January 11, 1996. Defendant filed a third-party complaint, which we can only characterize as rambling and incomprehensible. Defendant alleged that Koetje and B & K fraudulently induced him to guarantee the loan by misrepresenting that Koetje was an officer of B & K. (Defendant has not explained how he could not have known whether Koetje was an officer of B & K, or how such a misrepresentation would have induced him to sign the documents.) Defendant also alleged "wrongful constructive execution [sic]" or "intentional or reckless infliction of severe mental distress" against Koetje. Defendant also sought relief from the corporate dissolution order on the grounds of "mistake, neglect, fraud, misrepresentation, misconduct and/or other reasons." Finally, defendant alleged that the third-party defendants conspired to deprive him of assets to Koetje's benefit. 3
Koetje and B & K moved for summary disposition pursuant to MCR 2.116(C)(6) (prior action), (C)(7) (prior judgment), and (C)(8) (failure to state claim on which relief can be granted). They argued that defendant's third-party claims reiterated issues raised and resolved in the prior dissolution and bankruptcy actions, and that res judicata, collateral estoppel, or judicial estoppel precluded these claims. Defendant did not file a formal response to the summary disposition motion and did not appear at the motion hearing. He did, however, file an affidavit that did not coherently address the summary disposition motions. Because defendant failed to meaningfully respond to any of the persuasive arguments the third-party defendants raised, the trial court granted summary disposition for all the third-party defendants. The trial court also awarded sanctions, including attorney fees, to third-party defendants under MCR 2.114. Koetje and S, B & P, who represented themselves in the litigation, were awarded attorney fees.
On December 2, 1996, plaintiff moved for summary disposition, apparently under MCR 2.116(C)(9) () and (C)(10) (no genuine issue of material fact). Again, defendant filed an incomprehensible affidavit instead of a formal response, and failed to appear at the hearing. The trial
court ruled in plaintiff's favor, and entered an order granting judgment for plaintiff in the amount of $35,835.85 (the principal of the debt plus the accrued interest, attorney fees, and costs).
Defendant argues that the trial court erred in granting plaintiff's motion for summary disposition. We deem that this issue is abandoned because it is not adequately briefed. Dresden v. Detroit Macomb Hosp. Corp., 218 Mich.App. 292, 300, 553 N.W.2d 387 (1996). Defendant has asserted that summary disposition under MCR 2.116(C)(9) was improper because the answer stated a valid defense. However, defendant has presented no argument whatsoever regarding what factual allegation in the answer states a valid defense, nor has defendant offered any explanation regarding why or how his answer constitutes a legally valid defense. Similarly, defendant argues that summary disposition under MCR 2.116(C)(10) was improper because his affidavit, as well as Koetje's interrogatory answer in the bankruptcy action (asserting that a bona fide dispute existed regarding the debt), required denial of the motion. However, defendant has offered no argument or explanation regarding how or why the affidavit and interrogatory answer created a genuine issue of material fact with respect to defendant's obligation to pay plaintiff under the terms of the note and guarantee. A party may not merely announce a position and leave it to this Court to discover and rationalize a basis for the claim. Joerger v. Gordon Food Service, Inc., 224 Mich.App. 167, 178, 568 N.W.2d 365 (1997). We therefore decline to address this issue.
Defendant also challenges the order dismissing Koetje and B & K as third-party defendants. Again, we deem this issue to be abandoned because it is not adequately argued in defendant's brief. Dresden, supra. Indeed, we are unable to discern the content or meaning of defendant's argument. Defendant seems to argue that Koetje misrepresented facts pertaining to the prior dissolution and bankruptcy proceedings, but he offers no explanation regarding why these arguments are relevant to this issue. We reiterate that defendant may not merely announce a position and leave it to this Court to rationalize a basis for the claim. Joerger, supra.
Defendant also argues that Jeakle violated MCR 2.603(A)(3) by continuing to defend the action after a default had been entered against him. Defendant raises this issue for the first time on appeal. Therefore, we need not address this issue, because it is not preserved for appellate review. Auto Club Ins. Ass'n v. Lozanis, 215 Mich.App. 415, 421, 546 N.W.2d 648 (1996). Furthermore, this issue has not been adequately briefed. Dresden, supra. Defendant has not argued that the outcome of these proceedings would have been different but for the alleged error. We also decline to address defendant's argument that Jeakle was deficient in his performance of his duties as a special master in the dissolution action, because it has not been briefed, and because it is not included in the statement of questions presented. Weiss v. Hodge (After Remand), 223 Mich.App. 620, 634, 567 N.W.2d 468 (1997). 4
Defendant argues that the trial court improperly awarded attorney fees under MCR 2.114 to third-party defendants Koetje and S, B & P because attorney fees may not be awarded to pro se litigants. This raises a question of law, which is reviewed de novo on appeal. In re Hamlet (After Remand), 225 Mich.App. 505, 521, 571 N.W.2d 750 (1997). We conclude that pro se parties are not eligible for attorney fee sanctions under MCR 2.114, and we vacate the order to the extent that it awards pro se litigants...
To continue reading
Request your trial
-
STATE EX REL. DOT v. NORMAN INDUS. DEV.
...377, 543 S.E.2d 743, 748-49 (2000); Rose v. Falcon Communications, Inc., 6 S.W.3d 429, 431 (Mo.App.1999); FMB-First Nat'l Bank v. Bailey, 232 Mich.App. 711, 591 N.W.2d 676 (1998); Watts v. Lane County, 142 Or.App. 489, 922 P.2d 686, 689 (1996); Lambert v. Byron, 650 So.2d 1201, 1203 (La.App......
-
Davis v. Boyce Trust 2350
...prerequisite to obtaining an award of attorney fees arguably supports plaintiff's position in this case. In FMB–First Mich. Bank v. Bailey, 232 Mich.App. 711, 591 N.W.2d 676 (1998), the trial court assessed sanctions under MCR 2.114(E) and (F) against the defendant, Donald Bailey, in favor ......
-
Armstrong v. Ypsilanti Charter Twp
...33. Id. at 46-47, 118 S.Ct. 966. 34. Id. at 47, 118 S.Ct. 966. 35. Id. at 49, 54-55, 118 S.Ct. 966. 36. FMB-First Michigan Bank v. Bailey, 232 Mich.App. 711, 728, 591 N.W.2d 676 (1998). But see MCR 2.613(C) (factual findings generally reviewed for clear error). 37. Cain v. Dep't of Correcti......
-
OAKLAND CTY. PROSECUTOR v. Beckwith
...v. Lucas, 68 Mich. 424, 36 N.W. 203 (1888), Chittenden v. Witbeck, 50 Mich. 401, 15 N.W. 526 (1883), FMB-First Michigan Bank v. Bailey, 232 Mich.App. 711, 591 N.W.2d 676 (1998), O'Dess v. Grand Trunk W. R. Co., 218 Mich.App. 694, 555 N.W.2d 261 (1996), Union Bank & Trust Co., NA v. Farmwald......