Wolf Creek Prod. v. Gruber
| Decision Date | 29 September 2022 |
| Docket Number | 358559 |
| Parties | WOLF CREEK PRODUCTION, INC., THOMAS NICHOLS, MICHAEL SHERRILL, and, THOMAS NELSON, Plaintiffs-Appellants, v. MICHAEL STEVEN GRUBER, Defendant-Appellee. |
| Court | Court of Appeal of Michigan — District of US |
UNPUBLISHED
Shiawassee Circuit Court LC No. 2021-005528-CB.
Before: Kirsten Frank Kelly, P.J., and Anica Letica and Michelle M. Rick, JJ.
Plaintiffs appeal by right the trial court's order involuntarily dismissing their complaint, which sought to vacate or modify an arbitration award favorable to defendant. Finding no errors warranting reversal, we affirm.
The controversy giving rise to this case began with a dispute over a finder's fee that was paid by the Professional Sporting Clay Association (PSCA) to nonparty Liquid Image Incorporated in connection with a contract executed between the PSCA and defendant Michael Steven Gruber's company Steve Gruber LLC. Liquid Image split the finder's fee with defendant. At the time defendant executed the contract, he was employed by plaintiff Wolf Creek Production, Inc., a corporation that develops and produces outdoor hunting, fishing, and related television and cable shows. Although Wolf Creek was paid $340,000 under the contract for its work related to production of the PSCA's show, it believed it should have received the portion of the finder's fee paid to defendant.
Wolf Creek terminated defendant's employment contract and the matter proceeded to arbitration, after which it was determined that defendant's termination was without good cause and was pretextual. After the trial court denied plaintiffs' complaint and motion to vacate the arbitration award, plaintiffs appealed, and we affirmed the trial court's order upholding the award. Wolf Creek Production, Inc v Gruber, unpublished per curiam opinion of the Court of Appeals, decided January 24, 2019 (Docket No. 342146).
The trial court subsequently remanded the case to the same arbitration panel for determination of the appropriate remedy. On February 8, 2021, the arbitration panel unanimously reached a decision that was generally in favor of defendant. Rather than filing a complaint and motion to vacate the arbitrators' remedial award, plaintiffs only filed a complaint.
No other action was taken in this case until July 21, 2021, when the trial court sua sponte entered a final opinion and order involuntarily dismissing plaintiffs' complaint. The trial court explained that "[r]equests to vacate arbitration awards must be made by motion," which "must be filed within 91 days after the date of the award." The trial court determined that plaintiffs failed to meet that deadline because they never filed a motion asking the court to modify the award.
On July 23, 2021, plaintiffs moved for relief from this involuntary dismissal order under MCR 2.612(C)(1)(a). Plaintiffs argued that (1) their failure to file the motion required by MCR 3.602 was the result of mistake, inadvertence, or excusable neglect in light of the parties' agreed-upon litigation "cease fire" that was not explained to the trial court, (2) the timelines set by MCR 3.602 are not jurisdictional, and (3) in the interests of justice, the trial court should have given plaintiffs an opportunity to have their case decided on the merits. On September 16, 2021, the trial court entered an opinion and order denying plaintiffs' motion for relief, finding that plaintiffs did not raise a challenge to the opinion and order under MCR 2.119(F), and that plaintiffs could not meet the standards under MCR 2.612(C)(1). This appeal followed.
A trial court's decision to dismiss a case under MCR 2.504(B)(1) is reviewed for an abuse of discretion, Maldonado v Ford Motor Co, 476 Mich. 372, 388; 719 N.W.2d 809 (2006), as is a trial court's decision on whether to set aside a judgment or order. Wolf v Mahar, 308 Mich.App. 120, 128; 862 N.W.2d 668 (2014). "An abuse of discretion occurs when the court's decision falls outside the range of principled and reasonable outcomes." Komendat v Gifford, 334 Mich.App. 138, 159 n 10; 964 N.W.2d 75 (2020) (quotation marks and citation omitted). The abuse-of-discretion standard recognizes that the circumstances of a case may present more than one reasonable and principled outcome. Maldonado, 476 Mich. at 388.
On appeal plaintiffs argue that the trial court abused its discretion when it dismissed plaintiffs' complaint and denied their motion for relief. Specifically, plaintiffs assert that the trial court (1) had less harsh alternatives to dismissal available, (2) failed to consider pertinent factors before dismissing the complaint, (3) erroneously viewed the 91-day time period set by MCR 3.602(J)(3) as jurisdictional, and (4) failed to give proper consideration to the parties' agreement to cease litigation during settlement negotiations, including that the parties' failure to bring this agreement to the court's attention was a mistake, inadvertence, or excusable neglect. We find none of these arguments convincing.
Plaintiffs' complaint sought to vacate or modify the arbitration panel's award. Under MCR 3.602(J)(1) () and (K)(1) (relating to modifying an award), the party seeking relief in the trial court must do so by filing a complaint and motion for relief. The motion must be made within 91 days of the date of the award. MCR 3.602(J)(3); MCR 3.602(K)(2). If a party fails to follow the court rules, the trial court may sua sponte dismiss that party's claims. MCR 2.504(B)(1). Moreover, it is well settled that "[t]rial courts possess the inherent authority to sanction litigants and their counsel, including the right to dismiss an action." Maldonado, 476 Mich. at 388.
Dismissal is, however, a drastic remedy and one that "should be taken cautiously." Vicencio v Ramirez, 211 Mich.App. 501, 506; 536 N.W.2d 280 (1995). When a trial court imposes a sanction of dismissal, it must "consider the circumstances of each case to determine if such a drastic sanction is appropriate." Duray Development, LLC v Perrin, 288 Mich.App. 143, 164-165; 792 N.W.2d 749 (2010) (quotation marks and citation omitted). When evaluating whether a trial court abused its discretion by dismissing an action for failure to comply with an order court rule, this Court has traditionally considered relevant factors such as whether the failure was willful or accidental, the party's history of compliance with other orders or its history of noncompliance or delay, whether the other party was prejudiced, and whether a lesser sanction would better serve the interests of justice. See Woods v SLB Property Mgt, LLC, 277 Mich.App. 622, 631; 750 N.W.2d 228 (2008).
Given the circumstances of this case, however, these factors are not particularly relevant to the issue of whether the trial court abused its discretion when it dismissed the complaint. Stated differently, once plaintiffs failed to file their motion to vacate or modify the award within 91 days of the date of the award, while the trial court was not required to dismiss the complaint, see Detroit Auto Inter-Ins Exchange v Gavin, 416 Mich. 407, 422; 331 N.W.2d 418 (1982), it was not an abuse of discretion to do so because in all practical effects, the 91-day period acts as a statute of limitations for bringing a challenge to an arbitrator's award, albeit nonjurisdictional. This conclusion is amply supported by our prior cases.
In Vyletel-Rivard v Rivard, 286 Mich.App. 13, 24-25; 777 N.W.2d 722 (2009), we affirmed the trial court's order denying the defendant's motion to vacate an arbitration award on the basis that the motion was not timely filed. In Rivard, the parties submitted to a domestic relations arbitration for purposes of settling their divorce. Id. at 14. The arbitrator issued the award on November 22, 2007, after which the defendant filed a request for clarification and motion to correct errors or omissions. Id. at 15-16. The arbitrator responded on December 7, 2007, which constituted the final award. Id. at 16.
The defendant did not file his motion to vacate the arbitrators award until March 28, 2008. Id. at 18. Although the trial court did address the merits of the defendant's motion, it denied the motion on the basis that it was not filed within 21 days of the date of the award, the time period for such motions relating to domestic relations cases. Id. at 19. On appeal, the defendant argued that because he filed a second motion to correct errors or omissions with the arbitrator after the December 7, 2007 award, the timeliness of his filing was dependent on when the arbitrator decided the second motion, making his filing timely. Id. at 21.
We rejected the defendant's argument that he was permitted to file a second motion with the arbitrator and concluded the 21-day period began on December 7, 2007, the date on which the arbitrator decided the defendant's first motion. Id. at 23-24. Noting that the court rule requires that motions to vacate "must" be filed within 21 days, and that the term "must" means that it is mandatory, we affirmed the trial court's order denying the defendant's motion. Id. at 25.
Similarly in Bidasaria v Central Mich. Univ, unpublished per curiam opinion of the Court of Appeals, issued May 14, 2015 (Docket No. 319596),[1] p 1, the plaintiff and defendant entered into arbitration after the plaintiff was terminated from his teaching position. The arbitrator issued its ruling on November 16, 2010, concluding the defendant acted properly when it terminated the plaintiff. Id. The plaintiff thereafter filed several lawsuits in state and federal court, all of which were unsuccessful. Id. at 2. On September 13, 2013, the plaintiff filed a complaint with the trial court seeking...
To continue reading
Request your trial