Jerico Const., Inc. v. Quadrants, Inc.

• Decision Date: 10 June 2003
• Docket Number: Docket No. 233674,Docket No. 233719.
• Citation: 666 N.W.2d 310,257 Mich. App. 22
• Parties: JERICO CONSTRUCTION, INC., Plaintiff/Counter-Defendant-Appellee. v. QUADRANTS, INC. and D & R Company, L.L.C., Defendants/Counter-Plaintiffs-Appellants. Jerico Construction, Inc., Plaintiff-Appellant, v. Quadrants, Inc. and D & R Company, L.L.C., Defendants-Appellees.
• Court: Court of Appeal of Michigan — District of US

666 N.W.2d 310

257 Mich. App. 22

JERICO CONSTRUCTION, INC., Plaintiff/Counter-Defendant-Appellee. v. QUADRANTS, INC. and D & R Company, L.L.C., Defendants/Counter-Plaintiffs-Appellants.

Jerico Construction, Inc., Plaintiff-Appellant, v. Quadrants, Inc. and D & R Company, L.L.C., Defendants-Appellees.

Docket Nos. 233674, 233719.

Court of Appeals of Michigan.

Submitted May 20, 2003, at Detroit.

Decided June 10, 2003, at 9:00 a.m.

Released for Publication July 23, 2003.

Richard Craig Krause & Assoc. (by Richard Craig Krause and Steven E. Bangs), East Lansing, for Jerico Construction, Inc.

Pierce, Duke & Mengel, PLC (by Mark C. Pierce and Paul T. Mengel), Bloomfield Hills, for Quadrants, Inc. and D & R Company, LLC.

Before JANSEN, P.J., and KELLY and FORT HOOD, JJ.

KELLY, J.

In these consolidated appeals, arising from a claim of tortious interference with a business relationship, defendants Quadrants, Inc. (Quadrants), and D & R Company, L.L.C. (D & R), appeal as of right an order denying Quadrants' motion for mediation sanctions and an order denying defendants' motion for sanctions pursuant to M.C.L. § 600.2591 and MCR 2.114. Plaintiff Jerico Construction, Inc., appeals as of right an order denying its motion for new trial following judgment entered on a jury verdict of no cause of action. We affirm in part and reverse in part.

I. Basic Facts and Procedural History

Plaintiff is a general contractor engaged in commercial and industrial construction and is a subcontractor for steel-erection projects. Quadrants is a general contractor engaged in commercial and industrial construction. D & R, a company related to Quadrants, is a subcontractor engaged in steel erection. In 1995, several of plaintiff's workers left plaintiff's employ to work for D & R. Plaintiff filed a complaint against Quadrants,¹ alleging that Quadrants tortiously interfered with plaintiff's employment relationship with these workers. Plaintiff also alleged that Quadrants breached several contracts.

Quadrants moved for partial summary disposition pursuant to MCR 2.116(C)(8), arguing that plaintiff failed to plead all the elements of tortious interference. Before the trial court heard Quadrants' motion, plaintiff moved to amend its complaint to add a claim of tortious interference against D & R. The trial court granted plaintiff's motion and Quadrants' motion. In January 1997, a mediation² panel unanimously awarded $10,500 in plaintiff's favor. The parties rejected the mediation award.

In February 1997, plaintiff filed a first amended complaint alleging that D & R tortiously interfered with plaintiff's business relationships with its workers. Plaintiff also alleged breach of contract and promissory estoppel against Quadrants.

D & R moved for summary disposition of plaintiff's tortious-interference claim pursuant to MCR 2.116(C)(8). Before the trial court ruled on D & R's motion, plaintiff again filed a motion for leave to amend its complaint to add allegations of malicious and illegal acts, arguing that discovery revealed facts supporting these allegations. The trial court denied plaintiff's motion and granted D & R's motion for summary disposition.

Plaintiff and Quadrants entered into a settlement on the remaining contract claims. A stipulated order of dismissal was entered reflecting a settlement of $11,000 on the contract claims and retaining plaintiff's right to appeal the trial court's orders dismissing plaintiff's tortious-interference claims and denying plaintiff's motion for leave to file a second amended complaint.

On appeal, this Court reversed the trial court's orders granting summary disposition to defendants on plaintiff's tortious-interference claims, concluding that plaintiff's second amended complaint withstood defendants' summary-disposition motions. Jerico Constr., Inc v. Quadrant, unpublished opinion per curiam of the Court of Appeals, issued March 26, 1999, 1999 WL 33453392 (Docket No. 206026). The matter was remanded to the trial court for further proceedings on the tortious interference claims.

On remand and following a jury trial, a judgment of no cause of action was entered in defendants' favor. Plaintiff simultaneously filed a motion for new trial in the trial court and a claim of appeal in this Court (Docket No. 232709). At the hearing on plaintiff's motion for new trial, defendants argued that the trial court did not have jurisdiction over the case because plaintiff had already filed a claim of appeal in this Court. The trial court agreed, refusing argument on the motion and declining to address the merits of the motion. Nonetheless, an order was entered denying plaintiff's motion for new trial. Plaintiff subsequently filed a second claim of appeal, which is the appeal before us now.

After plaintiff filed this claim of appeal, this Court entered an order dismissing plaintiff's first claim of appeal for lack of jurisdiction, ruling:

[The judgment of no cause of action] was not a final order at the time that the claim was filed. If an appellant files a motion for a new trial, reconsideration, rehearing or similar postjudgment relief within 21 days of the entry of a final order, the finality of the order is suspended until the trial court denies that motion. An appeal as of right may then be claimed from the final order within 21 days after entry of the order denying the motion. See MCR 7.204(A)(1)(b). A claim of appeal that is filed before the entry of the denial order is a premature claim.

After the entry of this order, plaintiff did not seek to have the trial court address the merits of its motion for new trial. Instead, plaintiff relied upon its claim of appeal from the order denying defendant's motion for new trial even though the trial court, finding it lacked jurisdiction, refused to address the motion.

Also following trial, Quadrants moved for mediation sanctions on the basis of plaintiff's rejection of the mediation award. Plaintiff argued that mediation sanctions were not appropriate because the order of dismissal reflecting the $11,000 settlement was a "verdict" for the purpose of mediation sanctions, and this verdict was more than the mediation award. To the contrary, Quadrants argued that pursuant to the plain and unambiguous language of MCR 2.403(O)(2), the $11,000 settlement of plaintiff's contract claims was not a "verdict" for the purposes of MCR 2.403(O).³ The trial court denied Quadrants' motion, ruling:

[Y]ou've got settlements here. You've got one in this case and one in the Broadway⁴ case. The settlement in the Broadway case is based on a ruling on a motion. But it was still a settlement. And the Broadway court said it's a verdict, for the purpose of determining mediation sanctions and this Court has to go along.

Both defendants then filed a motion for sanctions pursuant to M.C.L. § 600.2591 and MCR 2.114, arguing that plaintiff's tortious-interference claims were frivolous. The trial court denied this motion.

II. Mediation Sanctions

Quadrants argues that the trial court erred in denying its motion for mediation sanctions. We agree.

A. Standard of Review

"We review the court's decision whether to grant mediation sanctions de novo because it involves a question of law, not a discretionary matter." Great Lakes Gas Transmission Ltd. Partnership v. Markel, 226 Mich.App. 127, 129, 573 N.W.2d 61 (1997). This issue also involves "interpretation of a court rule, which, like matters of statutory interpretation, is a question of law that we review de novo." Marketos v. American Employers Ins. Co., 465 Mich. 407, 412, 633 N.W.2d 371 (2001).

In Marketos, our Supreme Court set forth the proper method for interpreting court rules:

"When called on to construe a court rule, this Court applies the legal principles that govern the construction and application of statutes. Accordingly, we begin with the plain language of the court rule. When that language is unambiguous, we must enforce the meaning expressed, without further judicial construction or interpretation. Similarly, common words must be understood to have their everyday, plain meaning." [Id. at 413, 633 N.W.2d 371, quoting Grievance Administrator v. Underwood, 462 Mich. 188, 193-194, 612 N.W.2d 116 (2000) (emphasis added).]

B. Definition of "Verdict" in MCR 2.403

The issue presented is whether the stipulated order dismissing plaintiff's tort claims and reflecting a settlement of $11,000 on plaintiff's contract claims falls under the definition of "verdict" for purposes of MCR 2.403(O)(2). We find that it does not.

At the time this case mediated, MCR 2.403(O) provided, in relevant part:

(1) If a party has rejected an evaluation and the action proceeds to trial, that party must pay the opposing party's actual costs unless the verdict is more favorable to the rejecting party than the mediation evaluation. However, if the opposing party has also rejected the evaluation, a party is entitled to costs only if the verdict is more favorable to that party than the mediation evaluation.

(2) For the purpose of this rule "verdict" includes,

(a) a jury verdict,

(b) a judgment by the court after a nonjury trial,

(c) a judgment entered as a result of a ruling on a motion filed after mediation. [Emphasis added.]

Michigan courts, recognizing that our Supreme Court intended what it plainly stated, have consistently ruled that MCR 2.403(O)(2) contains a specific and precise definition of "verdict." Our Supreme Court itself held that 2.403(O)(2) provides a specific and "precisely worded" definition of "verdict." Freeman v. Consumers Power Co., 437 Mich. 514, 519, 473 N.W.2d 63 (1991). This Court similarly held "that the current version of MCR 2.403(O)(2)(c), now expressly provides a definition of `verdict'...." Herrera v. Levine, 176 Mich. App. 350, 359, 439 N.W.2d 378 (1989).

In applying MCR 2.403(O)(2), this Court has consistently rejected attempts to expand or read additional meaning into the rule that is not expressly stated. In Johnson v....