Case ID: nw2d_929/html/0809-01.html
Source: Caselaw Access Project
Author: {"author": "Ronayne Krause, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

ESTATE OF Diana Lykos VOUTSARAS, BY Kathleen M. GAYDOS, Personal Representative, Plaintiff-Appellant, and Spiro Voutsaras, Plaintiff, v. Gary L. BENDER, Richard A. Cascarilla, Lindsay Nicole Dangl, Vincent P. Spagnuolo, and Murphy & Spagnuolo P.C., Defendants, and Kenneth M. Mogill, Mogill Posner & Cohen, Kern G. Slucter and Gannon Group, P.C., Defendant-Appellees.
    No. 340714
    Court of Appeals of Michigan.
    Submitted December 11, 2018, at Lansing Decided January 3, 2019, 9:05 a.m.
    The Gallagher Law Firm PLC (by Byron P. Gallagher, Jr., and Samuel A. Lusk), Lansing, for Kathleen M. Gaydos, as personal representative of the estate of Diana Lykos Voutsaras.
    Maddin Hauser Roth & Heller, PC (by Kathleen H. Klaus and Jesse L. Roth ), Southfield, for Kenneth Mogill and Mogill Posner & Cohen.
    Fahey Schultz Burzych Rhodes PLC (by John S. Brennan ), Okemos, for Kern G. Slucter and Gannon Group, PC.
    Before: Swartzle, P.J., and Sawyer and Ronayne Krause, JJ.
   Ronayne Krause, J.

Plaintiff-appellant, the estate of Diana Lykos Voutsaras (the Estate) appeals as of right the trial court's order granting summary disposition in favor of defendants Kenneth M. Mogill, Mogill Posner & Cohen, Kern G. Slucter, and Gannon Group, P.C. (collectively, the Mogill defendants). This appeal arises, in relevant part, out of the Estate's action against the Mogill defendants for professional malpractice in their services as expert witnesses. The trial court held that a party's own expert witnesses, regardless of any duty to their client, are shielded by witness immunity. We hold that licensed professionals owe the same duty to the party for whom they testify as they would to any client and that witness immunity is not a defense against professional malpractice. Therefore, we reverse and remand.

I. STATEMENT OF FACTS

The underlying litigation involved the foreclosure of a commercial mortgage and note made by Diana and Spiro Voutsaras and held by Gallagher Investments (Gallagher). The Voutsarases hired the law-firm defendants to represent them in the foreclosure proceedings. The Voutsarases, on the advice of the law-firm defendants, filed a counterclaim against Gallagher and a third-party claim against some of the principal actors involved with Gallagher for malpractice. The law-firm defendants then hired the Mogill defendants to provide litigation support and ultimately serve as expert witnesses at trial. Kenneth Mogill was considered to be a preeminent authority on legal ethics in the state of Michigan, and Slucter and Gannon Group were experts in the field of real-estate brokerage and best practices in the field. Ultimately the law-firm defendants informed the Voutsarases that their litigation strategy was bound to fail, and the trial court granted summary disposition against the Voutsarases.

Diana Voutsaras passed away in January 2015, and the Estate then brought the present action against the law-firm defendants and the Mogill defendants. The Estate claimed that the law-firm defendants failed to advise Diana Voutsaras of a favorable settlement offer and that the law-firm defendants deliberately concealed the fact that the Voutsarases' claims were frivolous in order to drive up their costs before trial. The Estate claimed that the Mogill defendants breached their duty to Diana Voutsaras by failing to properly investigate the facts required to formulate their opinions, failing to understand the applicable standards, and failing to provide a competent professional opinion. Noting that the ability to sue one's own expert witnesses was an issue of first impression in Michigan, the trial court engaged in a broad reading of prior witness-immunity standards and granted summary judgment to the Mogill defendants on that theory. This appeal followed.

II. PRESERVATION AND STANDARD OF REVIEW

A. PRESERVATION OF THE ISSUE

An issue is preserved for appellate review if raised in the trial court and pursued on appeal. Peterman v. Dep't of Natural Resources , 446 Mich. 177, 183, 521 N.W.2d 499 (1994). The Estate argued that whether a party may sue his or her own expert witness was an issue of first impression in Michigan and that the trial court should follow caselaw from sister state courts on that matter. The trial court agreed that this issue was an open question in Michigan but determined that defendant Mogill was entitled to witness immunity because that doctrine is broadly construed and because the policy considerations underlying the doctrine would be advanced by its application in this case. The issue is preserved.

B. STANDARD OF REVIEW

This Court reviews de novo a trial court's decision to grant summary disposition.

Bowden v. Gannaway , 310 Mich.App. 499, 503, 871 N.W.2d 893 (2015). A court may grant summary disposition under MCR 2.116(C)(7) "because of ... immunity granted by law ...." "A party may support a motion under MCR 2.116(C)(7) by affidavits, depositions, admissions, or other documentary evidence." Maiden v. Rozwood , 461 Mich. 109, 119, 597 N.W.2d 817 (1999). This Court also reviews de novo the applicability of legal doctrines, Husted v. Auto-Owners Ins. Co. , 213 Mich.App. 547, 555, 540 N.W.2d 743 (1995), aff'd 459 Mich. 500, 591 N.W.2d 642 (1999), and claims of immunity, Denhof v. Challa , 311 Mich.App. 499, 510, 876 N.W.2d 266 (2015).

III. ARGUMENT

A. DUTY OF AN EXPERT WITNESS WHO IS A LICENSED PROFESSIONAL

The Estate claims that defendants owed to Diana Voutsaras a legal duty and that defendants breached that duty. Duty is "the legal obligation to conform to a specific standard of conduct in order to protect others from unreasonable risks of injury." Lelito v. Monroe , 273 Mich.App. 416, 419, 729 N.W.2d 564 (2006). As will be discussed further, our decision in this matter is limited to a claim of professional malpractice, which "arises from the breach of a duty owed by one rendering professional services to a person who has contracted for those services ... predicated on the failure of the defendant to exercise the requisite professional skill." Broz v. Plante & Moran, PLLC , 326 Mich.App. 528, 535-37, 928 N.W.2d 292 (2018). "Generally, to state a claim for malpractice, a plaintiff must allege (1) the existence of a professional relationship, (2) negligence in the performance of the duties within that relationship, (3) proximate cause, and (4)

the fact and extent of the client's injury." Id . at 537-38, 928 N.W.2d 292.

The trial court granted summary disposition to defendants solely on the basis of witness immunity. Defendants now argue on appeal that regardless of witness immunity, the Estate has failed to show that defendants owed a legal duty to Diana Voutsaras. "An issue not addressed by the trial court may nevertheless be addressed by the appellate court if it concerns a legal issue and the facts necessary for its resolution have been presented." Sutton v. Oak Park , 251 Mich.App. 345, 349, 650 N.W.2d 404 (2002). We are not satisfied that this record presents us with the facts necessary to resolve this issue. Nevertheless, we presume for the sake of argument that defendants are subject to claims for professional malpractice by the Estate and breached their professional duties to Diana Voutsaras. However, we do not decide those questions, and we leave for the trial court to determine in the first instance whether, in fact, defendants owed or breached a legal duty to Diana Voutsaras. We address only whether defendants are immune from liability related to that duty, if any.

B. WITNESS IMMUNITY AS A DEFENSE TO MALPRACTICE

1. MICHIGAN CASELAW

Defendants and the trial court rely on our Supreme Court's opinion in Maiden , 461 Mich. at 109, 597 N.W.2d 817, for the proposition that all witnesses enjoy total immunity for any relevant testimony provided during judicial proceedings. Our Supreme Court observed that "the duty imposed on a witness is generally owed to the court, not the adverse party," so a breach of that duty "does not give rise to a cause of action in tort by the adverse party." Id . at 133-134, 597 N.W.2d 817. Our Supreme Court continued:

[W]itnesses who testify during the course of judicial proceedings enjoy quasi-judicial immunity. This immunity is available to those serving in a quasi-judicial adjudicative capacity as well as "those persons other than judges without whom the judicial process could not function." 14 West Group's Michigan Practice, Torts, § 9:393, p 9-131. Witnesses who are an integral part of the judicial process "are wholly immune from liability for the consequences of their testimony or related evaluations." Id ., § 9:394, pp. 9-131 to 9-132, citing Martin v. Children's Aid Society , 215 Mich.App. 88, 96, 544 N.W.2d 651 (1996). Statements made during the course of judicial proceedings are absolutely privileged, provided they are relevant, material, or pertinent to the issue being tried. See Martin v. Children's Aid Society , supra ; Rouch v. Enquirer & News of Battle Creek , 427 Mich. 157, 164, 398 N.W.2d 245 (1986) ; Meyer v. Hubbell , 117 Mich.App. 699, 709, 324 N.W.2d 139 (1982) ; Sanders v. Leeson Air Conditioning Corp , 362 Mich. 692, 695, 108 N.W.2d 761 (1961). Falsity or malice on the part of the witness does not abrogate the privilege. Sanders , supra . The privilege should be liberally construed so that participants in judicial proceedings are free to express themselves without fear of retaliation. Id . [ Maiden , 461 Mich. at 134, 597 N.W.2d 817.]

We find Maiden only partially applicable, for several reasons.

First, the policy considerations in Maiden were clearly focused on the freedom witnesses must have to give damaging testimony without any fear of possible reprisal. We agree with defendants and the trial court to the extent that such policy considerations extend beyond witnesses who are formally or functionally adverse. In other words, any witness called by any party enjoys immunity based on the substance of that witness's testimony or evidence. Therefore, to the extent the Estate may assert that the Mogill defendants gave testimony that was unfavorable to Diana Voutsaras, such assertions unambiguously run afoul of the witness-immunity doctrine in Michigan. However, whether witness immunity protects the Mogill defendants from giving professionally incompetent testimony, which might or might not be favorable, was clearly not a matter considered by the Maiden Court. As our Supreme Court recently explained, to derive a rule of law from the facts of a case "when the question was not raised and no legal ruling on it was rendered, is to build a syllogism upon a conjecture." People v. Seewald , 499 Mich. 111, 121 n. 26, 879 N.W.2d 237 (2016).

Additionally, the witness-immunity doctrine at issue in Maiden addresses only actual testimony. That immunity necessarily extends to any other materials or evidence prepared by the witness for the intended benefit of the court. See Denhof , 311 Mich.App. at 511-520. Nevertheless, the Estate's complaint appears to allege that the Mogill defendants provided expert opinions for the benefit of Diana Voutsaras or her attorneys in addition to intended expert testimony for the court. Furthermore, the Estate alleges that the Mogill defendants not only provided incompetent opinions but failed to undertake reasonable skill and care in forming those opinions. As previously discussed, we presume that the Mogill defendants owed Diana Voutsaras a duty of professional care; the Estate essentially alleges a perfectly ordinary claim of legal malpractice, asserting that the Mogill defendants breached that duty of professional care.

To the extent that the Estate's claims rest on the Mogill defendants having provided damaging testimony or evidence intended for consideration by the trial court, the Mogill defendants are clearly protected by the doctrine of witness immunity. However, we find nothing in Maiden , or in any other Michigan caselaw, suggesting that any other claim of professional malpractice by a client is precluded merely because the professional was expected to provide expert testimony. We decline to parse which particular claims in this matter are immunized. We hold only that the Mogill defendants are not absolutely immunized from professional-malpractice claims where they already owed a duty of professional care merely because part of their retention included the provision of expert testimony.

2. OTHER JURISDICTIONS

Although not binding, authority from other jurisdictions may be considered for its persuasive value. Abela v. Gen. Motors Corp., 469 Mich. 603, 607, 677 N.W.2d 325 (2004). We have considered the extrajurisdictional caselaw provided to us by the parties, and we find, on balance, that the most persuasive precedent supports our conclusion.

In Briscoe v. LaHue , 460 U.S. 325, 103 S.Ct. 1108, 75 L.Ed.2d 96 (1983), the United States Supreme Court, whose holdings are obviously binding on this Court, held that the common-law standard of witness immunity was not abridged by federal law and therefore that a police officer could not be held liable for perjured testimony given during the plaintiff's trial. The Court proceeded to lay out the policy reasons behind witness immunity, holding: "A witness's apprehension of subsequent damages liability might induce two forms of self-censorship. First, witnesses might be reluctant to come forward to testify. And once a witness is on the stand, his testimony might be distorted by the fear of subsequent liability." Id . at 333, 103 S.Ct. 1108 (citation omitted). The Court explained that "the truthfinding process is better served if the witness's testimony is submitted to 'the crucible of the judicial process so that the factfinder may consider it, after cross-examination, together with the other evidence in the case to determine where the truth lies.' " Id . at 333-334, 103 S.Ct. 1108, quoting Imbler v. Pachtman , 424 U.S. 409, 440, 96 S.Ct. 984, 47 L.Ed.2d 128 (1976) (White, J., concurring in the judgment). This case merely reaffirms that a witness must be immune to the consequences of providing damaging testimony, which in turn must extend to a party's own witnesses.

In Mattco Forge, Inc. v. Arthur Young & Co. , 5 Cal.App.4th 392, 6 Cal.Rptr.2d 781 (1992), the California Court of Appeals held that California's "litigation privilege" statute did not bar a party from bringing suit against its own expert. In that case, the plaintiff (Mattco) engaged the defendant (Arthur Young) "to perform litigation support accounting work" in the underlying action. Id . 6 Cal.Rptr.2d 781, 5 Cal.App.4th at 395. After the dismissal of that suit, Mattco brought suit against Young, alleging, in part, professional malpractice, negligence, and breach of contract. Id . 6 Cal.Rptr.2d 781, 5 Cal.App.4th at 396. The California Court of Appeals determined that the policy considerations behind the litigation privilege-freedom of access to courts and the encouragement of truthful testimony-would be best served by allowing malpractice proceedings against expert witnesses:

Arthur Young was not a "neutral expert," but one hired by Mattco. If an expert witness's negligence and breach of contract cause dismissal of the party who hired that expert witness, that does not expand freedom of access to the courts. Applying the privilege in this circumstance does not encourage witnesses to testify truthfully; indeed, by shielding a negligent expert witness from liability, it has the opposite effect. Applying the privilege where the underlying suit never reached the trial stage would also mean that the party hiring the expert witness would have to bear the penalty for the expert witness's negligence. That result would scarcely encourage the future presentation of truthful testimony by that witness to the trier of fact. [ Id . at 404, 6 Cal.Rptr.2d 781.]

The California Court of Appeals found the distinction between one's own witnesses and adversarial witnesses to be of unique importance, because the policies underlying witness immunity "can logically apply ... only to trial testimony of adverse witnesses" and thus were immaterial to "a pretrial dispute between a party and its own expert witness that arose during discovery." Id. at 406, 6 Cal.Rptr.2d 781.

In Murphy v. A A Mathews , 841 S.W.2d 671, 672 (Mo., 1992), the defendant engineering firm was retained by a subcontractor to prepare claims for additional compensation. The firm testified at arbitration, and the subcontractor was awarded substantially less than what it was seeking. Id . The subcontractor then filed suit against the engineering firm, alleging that the engineering firm "was negligent in its performance of professional services involving the preparation and documentation of [the subcontractor's] claims for additional compensation ...." Id . The Missouri Supreme Court observed that witness-immunity decisions generally entailed statements made "directly in the judicial proceeding itself or in an affidavit or pleading, and all of the statements were made by adverse witnesses or parties." Id . at 677. It concluded that witness immunity was not properly applied "to bar a suit against a privately retained professional who negligently provides litigation support services." Id . at 680. The court reasoned that the policies underlying witness immunity would not be served by protecting "professionals selling their expert services rather than as an unbiased court servant." Id . at 681. Furthermore, subjecting professionals to liability for negligence would encourage skill, care, and prudence and would discourage "extreme and ridiculous positions in favor of their clients in order to avoid a suit by them." Id . The court also emphasized the role expert witnesses play in case preparation, providing advice and advocacy, and even playing as much of "a role in the organization and shaping and evaluation of their client's case as do the lawyers." Id . at 682. It therefore permitted the action against the engineering firm.

In LLMD of Mich., Inc. v. Jackson-Cross Co. , 559 Pa. 297, 298, 740 A.2d 186 (1999), the plaintiffs hired an accounting firm in the underlying action to calculate their lost profits. At trial, a critical mathematical error in the firm's calculations was revealed during cross-examination of the firm's chairman. Id . at 299, 740 A.2d 186.

The chairman had not personally prepared the lost-profits calculation and could not explain the error. Id . The trial court granted a motion to strike the chairman's testimony. The next day, the plaintiffs accepted a settlement offer for $750,000; the firm later recalculated the lost profits at $2.7 million. Id . The plaintiffs then sued the firm for breach of contract and professional malpractice. Id . at 300, 740 A.2d 186. The Pennsylvania Supreme Court held that witness immunity did not bar the action but emphasized that it arrived at this conclusion because the gravamen of the action was negligence in formulating the expert opinion rather than dissatisfaction with the substance of the opinion. Id . at 304-307, 740 A.2d 186. In particular, "[a]n expert witness must be able to articulate the basis for his or her opinion without fear that a verdict unfavorable to the client will result in litigation...." Id . at 306, 740 A.2d 186. However, "immunizing an expert witness from his or her negligence in formulating that opinion" would not serve the purposes behind witness immunity. Id . Rather, "[t]he judicial process will be enhanced only by requiring that an expert witness render services to the degree of care, skill and proficiency commonly exercised by the ordinarily skillful, careful and prudent members of their profession." Id . at 306-307, 740 A.2d 186. Thus, the court held that the accounting firm was not entitled to witness immunity. Id .

The Connecticut Superior Court (i.e., a trial court) followed LLMD of Mich., Inc. in Pollock v. Panjabi , 47 Conn.Supp. 179, 781 A.2d 518 (2000). In Pollock , the plaintiffs retained a spinal biomechanics expert to perform experiments relating to the underlying personal-injury action. Id . at 180, 781 A.2d 518. After pretrial voir dire of the expert, the trial court ruled that the expert's opinion was not credible and was not admissible at trial. Id . at 182, 781 A.2d 518. The trial court granted numerous continuances so that the expert could perform additional experiments, but the expert repeatedly failed to follow the conditions set forth by the trial court. Id . at 182-183, 781 A.2d 518. Ultimately, the plaintiffs brought suit against the expert and a kinesiologist hired by the expert alleging, in part, breach of contract and negligence. Id . at 183, 781 A.2d 518. The Connecticut Superior Court held that the defendants were not entitled to invoke witness immunity, determining that the

policy reasons undergirding the absolute privilege accorded witnesses are not implicated here. This is not a case in which the right of a witness to speak freely, in or out of court, is involved. While conduct, objects and experiments may have communicative aspects, the plaintiffs do not complain about what [the spinal biomechanics expert] said or about anything [the kinesiologist], who never testified, said or communicated. Rather, the plaintiffs complain of the defendants' failure to perform work, as agreed upon, according to scientific principles as to which there are no competing schools of thought. [ Id . at 188 (citation omitted), 781 A.2d 518.]

The court concluded that the gravamen of the plaintiffs' claim was to "hold the defendants accountable for not doing what they agreed to do," which did not undermine the witness-immunity policy of ensuring that witnesses could speak freely. Id. at 194, 781 A.2d 518.

We find these cases to be the most persuasive. However, additional state courts have allowed a party to sue its own expert, determining that the policy considerations underlying the doctrine of witness immunity would not be furthered by application in those cases. See Boyes-Bogie v. Horvitz , 14 Mass.L.Rptr. 208, 2001 WL 1771989 (Mass. Super., 2001) (holding that witness immunity did not bar an action against a friendly expert who was negligent in valuing a marital asset); Marrogi v. Howard , 805 So.2d 1118, 1131, 2001-1106 (La 1/15/02) (holding, in a case in which the friendly expert made numerous errors in estimating the plaintiff's billings and in which summary judgment was granted on the basis of the expert's deposition testimony, that "claims in connection with a retained expert's alleged failure to provide competent litigation support services are not barred by the doctrine of witness immunity"); Hoskins v. Metzger , 102 So.3d 752, 753 (Fla. App., 2012) (holding that it was erroneous for the trial court to dismiss an action against a friendly expert on the basis of witness immunity when the plaintiffs were alleging that they lost at trial because of the expert's appearance at trial and "his inadequate testimony").

3. WITNESS IMMUNITY AS A DEFENSE AGAINST MALPRACTICE

It bears repeating that the Maiden Court prefaced its discussion of witness immunity by ruling that the medical examiner was an adverse witness to the plaintiff. Maiden , 461 Mich. at 133, 597 N.W.2d 817. Witness immunity protects all witnesses, including experts retained by a party, from suit for testimony or evidence premised on the damaging nature thereof. However, we note that a common theme in the cases discussed earlier was whether to extend witness immunity to ordinary professional malpractice claims. We find no Michigan law suggesting that witness immunity already precludes a claim by a client against a retained professional for the negligent performance of professional services. We are persuaded by the reasoning in the above cases that witness immunity should not be further extended. When a duty of professional care exists such that a malpractice action may be maintained, witness immunity is not a defense to a malpractice action except, as noted, insofar as the action is premised on the substance of the professional's evidence or testimony intended to be provided to the court.

IV. CONCLUSION

We conclude that the trial court erred by construing the doctrine of witness immunity too broadly. A professional's client is not precluded from maintaining a professional malpractice action by witness immunity except to the extent the action is premised on the substance of evidence or testimony prepared for the benefit of the court. We decline to address any other issues, such as the specific duties owed in this matter or the extent to which plaintiff's specific allegations actually implicate witness immunity. We reverse the trial court's grant of summary disposition pursuant to MCR 2.116(C)(7), and we remand for further proceedings. We do not retain jurisdiction. An important public question of first impression being involved, we direct that the parties shall bear their own costs. MCR 7.219(A).

Swartzle, P.J., and Sawyer, J., concurred with Ronayne Krause, J. 
      
      On October 2, 2017, Ingham Circuit Court Judge Matthew J. Stewart entered a stipulated order of dismissal following a settlement agreement between plaintiff Kathleen Gaydos, as the personal representative of the estate of Diana Voutsaras, and defendants Gary Bender, Richard Cascarilla, Lindsay Dangl, Vincent Spagnuolo, and Murphy & Spagnuolo, P.C. (collectively, the law-firm defendants), who were Diana and Spiro Voutsaras's attorneys in the underlying litigation.
     
      
      See note 1 of this opinion.
     
      
      That statute provided, in part: " 'A privileged publication or broadcast is one made: ... In any (1) legislative or (2) judicial proceeding, or (3) in any other official proceeding authorized by law, or (4) in the initiation or course of any other proceeding authorized by law and reviewable pursuant to Chapter 2 ....' " Mattco Forge, Inc. , 5 Cal.App.4th at 402, 6 Cal.Rptr.2d 781, quoting Cal. Civ. Code 47(b).