Warren v. Pickering

• Citation: 480 N.W.2d 306,192 Mich.App. 153
• Decision Date: 02 December 1991
• Docket Number: Nos. 121260,121261,s. 121260
• Parties: James WARREN and Letha Warren, Plaintiffs-Appellees, and Fireman's Fund Insurance Company, Intervening Plaintiff-Appellant, v. Leonard M. PICKERING, M.D., Conant Chiropractic Clinic, P.C., and Gary W. Conant, D.C., Defendants-Appellees, and R.W.F. Harnett, M.D., D.V. Balarezo M.D., and Richard A. Crocetto, D.C., Defendants. James WARREN and Letha Warren, Plaintiffs-Appellees, and Fireman's Fund Insurance Company, Intervening Plaintiff-Appellant, v. R.W.F. HARNETT, M.D., and D.V. Balarezo, M.D., Defendants-Appellees, and Leonard M. Pickering, M.D., Conant Chiropractic Clinic, P.C., Gary W. Conant, D.C., and Richard A. Crocetto, D.C., Defendants. 192 Mich.App. 153, 480 N.W.2d 306
• Court: Court of Appeal of Michigan (US)

Page 306

480 N.W.2d 306

James WARREN and Letha Warren, Plaintiffs-Appellees, and Fireman's Fund Insurance Company, Intervening Plaintiff-Appellant, v. Leonard M. PICKERING, M.D., Conant Chiropractic Clinic,

P.C., and Gary W. Conant, D.C.,

Defendants-Appellees,

and

R.W.F. Harnett, M.D., D.V. Balarezo M.D., and Richard A.

Crocetto, D.C., Defendants.

James WARREN and Letha Warren, Plaintiffs-Appellees, and Fireman's Fund Insurance Company, Intervening Plaintiff-Appellant, v. R.W.F. HARNETT, M.D., and D.V. Balarezo, M.D.,

Defendants-Appellees,

and

Leonard M. Pickering, M.D., Conant Chiropractic Clinic,

P.C., Gary W. Conant, D.C., and Richard A.

Crocetto, D.C., Defendants.

Nos. 121260, 121261.

192 Mich.App. 153, 480 N.W.2d 306

Court of Appeals of Michigan.

Submitted May 22, 1991, at Detroit.

Decided Dec. 2, 1991, at 9:20 a.m.

Released for Publication March 10, 1992.

[192 MICHAPP 154] Charters, Heck & O'Donnell, P.C. by Margaret A. O'Donnell, Bloomfield Hills, for Fireman's Fund Ins. Co.

Siemion, Huckabay, Bodary, Padilla & Morganti, P.C. by Raymond W. Morganti, Detroit, for Leonard M. Pickering, M.D., R.W.F. Harnett, M.D., and D.V. Balarezo, M.D.

Before HOLBROOK, P.J., and SULLIVAN and DOCTOROFF, JJ.

SULLIVAN, Judge.

The trial court ordered intervening plaintiff, Fireman's Fund Insurance Company, and plaintiffs to pay both taxable costs and mediation sanctions to defendants after a directed verdict and a verdict of no cause of action were rendered in defendants' favor in the underlying medical malpractice case. Fireman's Fund now appeals those orders requiring it to pay mediation sanctions, arguing that, because it was not the party who rejected the mediation evaluation under MCR 2.403(O), it cannot be required to pay mediation sanctions. We agree and, therefore, reverse those parts of the trial court's orders requiring Fireman's Fund to pay mediation sanctions.

Plaintiffs sued defendants for medical malpractice. Fireman's Fund, the worker's compensation carrier for plaintiff James Warren's employer, successfully moved to intervene in the case under M.C.L. Sec. 418.827; M.S.A. Sec. 17.237(827), seeking reimbursement for amounts it had paid to Warren under the [192 MICHAPP 155] Workers' Disability Compensation Act, M.C.L. Sec. 418.101 et seq.; M.S.A. Sec. 17.237(101) et seq.

The medical malpractice case was mediated on August 17, 1987. The panel unanimously awarded the Warrens $15,000 against each of three defendants for a total award of $45,000. Although defendants accepted the mediation evaluation, the Warrens rejected it. Fireman's Fund was listed as a party at mediation, but had no claim mediated. Two years later, the case was tried before a jury, resulting in judgments in favor of all defendants.

The defendants thereafter moved for and were granted mediation sanctions. Over the objection of Fireman's Fund, the court ordered it to pay one-half of the mediation sanctions. Fireman's Fund's only claim that we need to address on appeal is that the trial court erred in ordering it to pay mediation sanctions. We agree.

The court rule that governs mediation provides in pertinent part that "[i]f 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." MCR 2.403(O)(1). Actual costs include reasonable attorney fees for services "necessitated by the rejection of the mediation evaluation." MCR 2.403(O)(6).

Neither the language nor the purpose of the mediation sanction court rule supports the conclusion that Fireman's Fund should be required to pay mediation sanctions. The court rule requires that the party rejecting the mediation evaluation in this case pay defendants their actual costs. Fireman's Fund did not reject the mediation evaluation; plaintiffs did. Nor did Fireman's Fund have the opportunity to reject the evaluation. Moreover, the record does not show that Fireman's Fund either encouraged or supported plaintiffs' rejection[192 MICHAPP 156] . In fact, Fireman's Fund claims that plaintiffs did not even consult with or advise it of their intention to reject the mediation evaluation.

The overall purpose of the mediation rule--MCR 2.403--is to encourage settlement and to deter protracted litigation. Sanders v. Monical Machinery Co., 163 Mich.App. 689, 691-692, 415 N.W.2d 276 (1987). Accordingly, the purpose behind the mediation sanction rule is to place the burden of litigation costs upon the party who insists upon a trial by rejecting a proposed mediation award. Bien v. Venticinque, 151 Mich.App. 229, 232, 390 N.W.2d 702 (1986). Requiring Fireman's Fund to pay mediation sanctions when it played no role in the rejection of the mediation evaluation would not further the purpose of the mediation sanction rule.

In this regard, we also note that the record reflects that Fireman's Fund was not the impetus behind plaintiffs' rejection of the mediation evaluation or any subsequent settlement offer. Fireman's Fund waived part of its...