Yoost v. Caspari

• Decision Date: 17 January 2012
• Docket Number: Docket No. 294299.
• Parties: YOOST v. CASPARI.
• Court: Court of Appeal of Michigan — District of US

295 Mich.App. 209

813 N.W.2d 783

YOOST

v.CASPARI.

Docket No. 294299.

Court of Appeals of Michigan.

Submitted Feb. 1, 2011, at Grand Rapids.

Decided Jan. 17, 2012, at 9:00 a.m.

Smietanka, Buckleitner, Steffes & Gezon (by Anne Buckleitner), Grandville, and Jones Day (by June K. Ghezzi, Brian J. Murray, and Erin Shencopp) for Hank Asher.

Burdick & Engeln, P.C. (by Carl R. Burdick), Saint Joseph, and Hughes, Socol, Piers, Resnick & Dym, Ltd. (by José J. Behar, Juliet Berger–White, and Matthew J. Piers), for Irwin C. Zalcberg.

Before: OWENS, P.J., and MARKEY and METER, JJ.

PER CURIAM.

Counterdefendant Hank Asher appeals by leave granted the trial court's order denying his motion for summary dispositionunder MCR 2.116(C)(1). He asserts that the trial court erred by ruling it that had limited jurisdiction over him under Michigan's long-arm statute, MCL 600.705(2), on the basis that defendant/counterplaintiff Irwin C. Zalcberg (Zalcberg) made a prima facie showing that Asher conspired with plaintiff, Wally Yoost, to commit the tort of abuse of process in Michigan. We reverse and remand for entry of an order granting Asher summary disposition.

I. SUMMARY OF FACTS AND PROCEEDINGS

Wally Yoost and Hank Asher are both citizens and residents of Florida. Zalcberg and defendants Patricia Caspari and Ellen Frankle are all residents of Michigan. Zalcberg is the sole shareholder and officer of Zalcberg Holdings, Inc., an Illinois corporation; he is in the business of trading equities and options from his home. Zalcberg employed Yoost from the fall of 1999 until early 2005. Yoost contends he worked as a trader and also provided estate management services for Zalcberg's wife, Sari. Zalcberg describes Yoost's employment as that of personal trainer, intern, and personal assistant. During Yoost's employment, Yoost met Patricia Caspari. They became romantically involved and began living together in 2001, in Michigan Shores, Indiana. Caspari often visited Yoost at Zalcberg's residence and became acquainted with Zalcberg. Yoost became acquainted with Lawrence Frankle, Zalcberg's personal friend, business partner, and legal counsel. Yoost claims that he often sought legal advice from Frankle.

In 2002, Zalcberg and Sari loaned Yoost $67,000, secured by a note and mortgage executed October 29, 2002, to purchase a house on Fogarty Street in Michigan City, Indiana. Also on October 29, 2002, Caspari quitclaimed any interest in the Fogarty property to Yoost. Yoost asserts that Frankle drafted the quitclaim deed as a means of protecting Yoost's interest in the property while he cohabitated with Caspari. Yoost and Caspari subsequently resided in the house on Fogarty Street and began making improvements.

Yoost alleges that in 2003 he informed Zalcberg that he was dissatisfied with his employment. Yoost asserts that Zalcberg enticed his continued employment by releasing him from any further obligations on the Fogarty property note and mortgage. Yoost continued working for Zalcberg and stopped making payments on the note and mortgage.

In 2004, Yoost and Caspari moved to Galien, Michigan, where they lived together. They rented out the Fogarty property. Yoost worked for Zalcberg until March 2005. Zalcberg filed for a divorce from Sari, who was suffering from terminal cancer, in March 2005; the divorce was final on March 28, 2006. Zalcberg contends that Asher, his former brother-in-law, harbored ill will against him since he filed for the divorce from Sari. Yoost and Caspari's relationship also ended in December 2005. Yoost subsequently moved to Florida and worked for Asher. In August 2006, Zalcberg began foreclosure proceedings on the Fogarty property in Indiana. Yoost defended the foreclosure action by asserting his claim that Zalcberg had forgiven the debt. Yoost also asserted other defenses, including that Zalcberg had failed to fulfill his oral promise to share certain trading profits with Yoost. See Yoost v. Zalcberg, 925 N.E.2d 763 (Ind.App., 2010). Yoost also attempted to assert a claim for trading profits in a suit for an accounting filed in Illinois against Zalcberg Holdings. That case was dismissed shortly after the instant case was initiated on the basis of forum non conveniensbecause the claim for profits concerned conduct that had occurred in Michigan and Indiana and could be joined to the already pending litigation in Indiana to which Zalcberg, the sole shareholder of Zalcberg Holdings, was a party.

Yoost filed the instant lawsuit against Caspari on April 8, 2008, alleging that she had attempted to extort a 50 percent interest in the Fogarty property by threatening to report Yoost to the IRS for not paying taxes on his income while working for Zalcberg. The complaint also alleged intentional infliction of emotional distress. After the discovery of numerous e-mails between Caspari and Zalcberg that suggested that Zalcberg and Frankle had encouraged Caspari's actions, Yoost was permitted to file an amended complaint adding Zalcberg and Frankle as defendants. By stipulation of the parties, Yoost filed a second amended complaint that substituted Ellen Frankle as the personal representative of the estate of Lawrence Frankle.

On January 28, 2009, Zalcberg filed a counterclaim in this case against Yoost and Asher alleging abuse of process and conspiracy to commit abuse of process. Zalcberg's counterclaim alleged, in part, that “Yoost and Asher agreed to join together in the concerted actions of Asher paying for and, on information and belief, directing a series of false and fraudulent legal claims filed in Yoost's name and against Zalcberg in the Indiana litigation for ulterior purposes ... including punishing, humiliating and embarrassing Zalcberg, extorting from him large sums of business profits,” and interfering with “a proper mortgage foreclosure action.” Zalcberg also alleged that Asher and Yoost had filed other lawsuits in Yoost's name in Illinois and Michigan for similar purposes and to intimidate witnesses favorable to Zalcberg and obtain discovery unavailable in Indiana. In this case, Zalcberg alleges that “Asher and Yoost, in Yoost's name,” assert “false and fabricated claims and seek [ ] grossly overreaching and irrelevant discovery.” With respect to discovery in the instant case, Zalcberg alleges that the trial court “denied [Yoost's] request to hold Zalcberg in contempt and entered a protective order denying the request for production of Zalcberg's trading and other business records.” Zalcberg alleged that the abuse of process caused him “financial losses, loss of business opportunities, and the expense of defending against fraudulent claims and abusive discovery.” Last, the counterclaim alleges that the actions of Asher and Yoost amounted to a civil conspiracy, resulting in the damages just described.

On May 29, 2009, Asher moved for summary disposition of Zalcberg's counterclaim pursuant to MCR 2.116(C)(1), asserting that the trial court lacked personal jurisdiction over him because he was a resident of Florida and had neither engaged in any business in Michigan nor had any qualifying contacts with the state. Asher further argued that the trial court could not exercise limited personal jurisdiction over him under Michigan's long-arm statute, MCL 600.705 and that Michigan's exercising jurisdiction over him would violate due process.

In support of his motion, Asher appended his own affidavit, which averred that he was a Florida resident, had not transacted any business in Michigan, and denied having “done or caused an act to be done, or caused consequences to occur in Michigan, resulting in an action for tort.” Asher acknowledged that he had employed Yoost since 2006, that he knew of litigation between Yoost and Zalcberg, and that he had “advanced money to Yoost's counsel” in Illinois and Indiana. However, Asher averred that he had “not caused litigation in Yoost's name to be brought or consequences to occur in any state against Irwin Zalcberg” and that he had “not involved [himself] in the decisions that Yoost and his lawyers have made with regard to how to proceed in any of the litigation between Yoost, Irwin Zalcberg, and the others.” Asher further averred that he “did not execute a letter of retention with Yoost's attorneys in any state” and that with respect to Yoost's legal fees, “Yoost's lawyers in Illinois and Indiana send work invoices to my staff in Florida for payment.”

Zalcberg filed a response opposing the motion and submitted excerpts of Yoost's testimony from depositions in the Indiana litigation. Zalcberg also contended that Asher's affidavit failed to comply with MCR 2.119(B)(1)(c) because it did not show affirmatively that Asher, if sworn as a witness, could testify competently to the facts stated in the affidavit. The trial court denied the motion. The court found that it lacked general jurisdiction over Asher and rejected the argument that it had limited jurisdiction under MCL 600.705(1) for the “transaction of any business within the state.” But the trial court ruled that it had limited jurisdiction under MCL 600.705(2), which provides limited personal jurisdiction arising out of “doing or causing an act to be done, or consequences to occur, in the state resulting in an action for tort.” The court explained:

[I]f the allegations in the complaint are true, there is no doubt that Asher caused an act to be done and consequences to occur in Michigan resulting in an action in tort, if those allegations are true that he is using this law suit for ulterior motives.

Here there is some documentary evidence ... to support the position of Zalcberg that the motion should not be granted. And that's the deposition testimony of Yoost regarding Asher's payment of legal fees under what I might describe as curious circumstances and ... Yoost's lack of recall as to whether he even read the complaint that was filed in this case. And I believe that ... this testimony, as well as the testimony of Yoost, that he...