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### STATE OF MICHIGAN

COURT OF APPEALS

JAMES H. HELD and NICHOLE HELD,

Plaintiffs-Appellants, UNPUBLISHED May 26, 2015

v No. 320072
Oakland Circuit Court GUSOLINE ALLEY, INC., d/b/a GUSOLINE ALLEY, LC No. 2013-132791-NO

Defendant-Appellee.

Before: M URPHY , P.J., and S TEPHENS and G ADOLA , JJ.

P ER C URIAM

.

Plaintiffs appeal as of right an order denying their motion fo r relief from judgment. The trial court had earlier granted plaintiffs’ motion for voluntar y dismissal without prejudice, MCR 2.504(A), with respect to plaintiffs ’ premises liability actionagainst defendant. But the dismissal ruling had also provided that any future suit filed by plaintif fs against defendant would be subject to a previous court decision striking plaintiffs’ witne ss and exhibit lists that were not timely filed under the co urt’s scheduling orde r. We reverse an d remand for further proceedings.

Plaintiff James Held alleged that on January 26, 2013, he suff ered an injury when he slipped and fell on a thin sheet of ice when exiting defendant’ s bar. Held and his wife Nichole Held, as plaintiffs, filed their suit against defendant in the Oakland Circuit Court on March 13, 2013. Plaintiffs were represented by an attorney, and counsel e-filed the complaint. At the time of this e-filing, counsel failed to register his e-mail address with the trial court as a “service

contact.” 1 In an affidavit filed by plainti ffs’ counsel later in the sui t, he averred:

1 Pursuant to § 6(a) (“Service”) of Administrative Order No. 200 7-3, 494 Mich lix (2013) (extending AO 2007-3 through June 30, 2015, with respect to Oak land Circuit Court’s e-filing pilot project):

All parties shall register with the court and opposing parties one e-mail address with the functionality required for the pilot program, through Tyler Odyssey File and Serve. All service shall originate from this registered e-mail
address.-2- On March 13, 2013, Plaintiffs’ counsel e-f iled this case with [the] Oakland County Circuit Court. This e-filing was accepted by . . . [the court]. Unbeknownst to Plaintiffs’ counsel, when the case was e-filed, Plaintiffs’ counsel’s e-filer did not click on the correct button, and Plaintiffs’ counsel was no t “attached” to the case as an official “service contact.” No one from [the] Oaklan d County Circuit
Court contacted me to advise me of this fact. I did not discove r until December 26, 2013[,] that I was not added a s a service contact on this c ase.

Defendant e-filed its answer to the complaint on April 8, 2013 . Plaintiffs’ counsel
indicated in his affidavit that h e was able to open and view do cuments e-filed by defendant in the case because, as explained to plaintiffs’ counsel by court pers onnel, “[d]efendant had been manually adding [counsel] as a service contact.” 2

On May 28, 2013, the trial court prepared, issued, and e-filed a scheduling order in which it directed, in part, that the parties exchange and file witnes s and exhibit lists no later than August 30, 2013. 3 The scheduling order also provided that discovery was to be c ompleted by September 24, 2013, that dispositive motions were to be filed b y October 18, 2013, that case evaluation was to take place in October 2013, and that the case had a trial date of February 6, 2014. Plaintiffs’ attorney averre d in his affidavit that he wa s not served with the scheduling order at the time, given that he was not listed as a “service c ontact” with the court. He further asserted that he was never served, by e-mail or otherwise, with the scheduling order. Plaintiffs’ counsel claimed that, in light of the fact that he did not rece ive the scheduling order, he was unaware of the filing deadlines, including the one for the witn ess and exhibit lists.

On August 30, 2013, in compliance with the scheduling order, d efendant filed and served its witness and exhibit lists; plaintiffs did not and were thus in violation of the scheduling order. On September 20, 2013, defendant e-filed a motion to extend the dates previously set in the scheduling order for discovery, case evaluation, and trial, not ing that defense counsel was in the process of transferring the case to a new attorney. Considerin g the affidavit executed by plaintiffs’ counsel, and according to a proof of service, defen dant’s motion was served on plaintiffs’ counsel by e-mail. D efendant e-file d a notice of h earing with respect to its motion, with the motion being scheduled for hearing on October 2, 2013, and the notice was served on plaintiffs’ counsel by e-mail. Before that hearing, on Septemb er 27, 2013, a stipulation and
order for substitution of defense counsel was e-filed and enter ed (stipulation was between prior

As implemented under the authority of AO 2007-3, policy rules o f the Oakland Circuit Court warn litigants that judges issue opinions and orders electronic ally, that all “[a]ll filers must register as a Service Contact t hrough Odyssey File and Serve,” and that “[i]f you fail to register, you will not receive copies of orders issued b y the Court.” Oakland Circuit Court, Notice of Mandatory E-Filing (empha sis in original).

2 Plaintiffs’ attorney averred, “ I received documents e-filed bydefense counsel on this case[.]”

3 There was no scheduling or pretr ial conference that precipitat ed entry of the scheduling order,
nor was such a conference re quired. MCR 2.401(B)(2).-3- and new defense counsel). The s tipulated order indicated that “[a]ll dates in the scheduling order shall remain in effect.” There is no proof of service in the r ecord regarding the stipulation and order, and it is simply unclear w hether plaintiffs’ counsel eve r observed the stipulation and order.

On October 2, 2013, a hearing was apparently held on defendant ’s motion to extend the dates for discovery, case evaluation, and trial. 4 The trial court entered an order extending two dates, changing the case evaluation date to November 29, 2013, and moving the discovery cutoff date to November 29 to coincide with the case evaluation da te; the trial court left the existing trial date in place. According to the affidavit of plaintiffs’ attorney, and as conveyed to him by court personnel, on October 16, 2013, counsel was officially ad ded as a “service contact” on the case for purposes of the court’s e-filing system, although coun sel himself did not become aware of this fact until December 26, 2013. On October 17, 2013, the court received for filing plaintiffs’ witness list, but no exhibit list was forthcoming. 5 Plaintiffs’ counsel averred in his affidavit that he “did not know the witness list was tardy” and that he “ simply did not know about the witness deadline because he never saw the scheduling order .” (Emphasis in original.)

On November 13, 2013, defendant filed a motion for leave to fi le a dispositive motion, as the deadline for dispositive motions set forth in the schedulin g order had elapsed. Defendant claimed that plaintiffs’ deposit ions had been conducted prior t o the new discovery deadline and that the depositions provided de fendant with “a strong factual basis upon which to file a dispositive motion.” In response to defendant’s motion, plaint iffs admitted that defendant had previously filed a motion to extend dates, which we again note was heard by the trial court on October 2, 2013, and that the court had “wisely declined to pos tpone the 10/18/13 dispositive
motion deadline.” 6 The trial court denied defenda nt’s motion at a hearing on Nov ember 20, 2013. Plaintiffs had not yet filed an exhibit list. On Novemb er 21, 2013, defendant filed a motion to strike plaintiffs’ witness list and any exhibit list should plaintiffs ever file one. The basis for the motion was noncompliance with the deadlines in th e scheduling order. In plaintiffs’ response to the motion, plainti ffs’ counsel indicated that he h ad never seen the scheduling order and thus did not know about the deadlines. As gleaned from the affidavit of plaintiffs’ counsel, he had not yet discovered the glitch concerning the “service co ntact” failure. Plaintiffs also

4 There is no transcript of a hearing contained in the record, b ut the resulting order on defendant’s motion suggests tha t a hearing was indeed conducted

.

5 Although the record is not entirely clear on the matter, we su rmise that in e-filing plaintiffs’ witness list, plaintiffs’ couns el, without realizing it, regist ered his firm as a “service contact” with respect to the case. A pr oof of service prepared by couns el himself provided, “I hereby certify that on today’s date, October 16, 2013, I electronicall y filed the foregoing paper [witness list] with the Clerk of the Cour t using the electronic filing s ystem, which will send notification of such filing.” This would explain why on October 16, 2013, plai ntiffs’ counsel’s e-mail address became registered as a service contact in the case. We note th at the witness list was not technically received by the court for filing until October 17, 2013.

6 This is the deadline for dispos itive motions set forth in the scheduling order.-4- argued that every witness on plai ntiffs’ witness list appeared on defendant’s witness list, that all of plaintiffs’ witnesses, except for one, had been identified b y plaintiffs in answers to interrogatories back in April 2013, and that defendant, given t hese circumstances, was not surprised or unfairly prejudice d by the late filing. Plaintiff s pointed out that defendant and plaintiffs, without objection, had conducted numerous depositio ns of witnesses, including depositions of both plaintiffs, w ho were on the “tardy” witness list and after expiration of the
deadline.

A hearing on defendant’s motion to strike was held on December 4, 2013. Late in the day on December 3, 2013, plaintiffs’ counsel submitted an exhib it list, which was not received for filing by the court until December 4, 2013. At the hearing , when plaintiffs’ counsel argued that there was no surprise or pr ejudice given the interrogatory answers and the names already identified on defendant’s witness list, the trial court remarke d, “That’s not the standard.” The trial court was especially angered by the last minute filing of the exhibit list before the hearing, stating that it reflected counsel’s awareness of the failure to comply with the scheduling order, reflected that the untimely fili ng of the witness list was not an isolated incident, and reflected “a pattern.” The trial court grant ed the motion and struck both t he witness and exhibit lists.

On December 11, 2013, plaintiffs filed a motion for voluntary dismissal without prejudice under MCR 2.504(A). A hearing on the motion was held on December 18, 2013. At the hearing, the trial court ru led from the bench as follows:

This motion now to dismiss voluntarily comes on the heels of t he Court’s previous ruling. I grant the motion to dismiss; however, any an d all orders that this Court entered in the current case will attach to any futur e filed case by the Plaintiff[s], inclusive of the C ourt’s granting of the motion t o strike the witness and exhibit lists, because I’m satisfied that this motion to di smiss is an effort to circumvent the Court’s ruling as it relates to striking the witness and exhibit lists, and I will not allow the Plaintiff[s] to do so. So the motion i s granted, with the condition attached that any futu re pleading or complaint filed, this Court’s previous orders follow any new filing.

The record does not show that the trial court’s ruling was red uced to a written order, and on December 31, 2013, plaintiffs filed a motion under MCR 2.612 for relief from judgment as to the trial court’s ruling. The motion, which attached the affid avit of plaintiffs’ counsel that we have referred to throughout thi s opinion, focused on the e-fili ng issue and the claimed inadvertent failure to register counsel’s e-mail address as a s ervice contact. Plaintiffs also attached various computer-generated “service details” in regardto the case and the court’s efiling system. These service details indicated that two employ ees of the law firm representing defendant at the time, one of whom was defense counsel, had ope ned the May 2013 e-filed scheduling order, but not plaintiffs’ counsel. In the affidavi t of plaintiffs’ counsel, he averred that the court’s e-filer, who wa s responsible for the e-filing and e-service of the scheduling order
as reflected in the service de tails, informed counsel “that she had not served [counsel] with the scheduling order” because he was not registered as a service co ntact at the time. Citing MCR 2.612(C)(1)(a) (“Mistake, inadvert ence, surprise, or excusable neglect”), and claiming a lack of prejudice, plaintiffs asked the trial court to set aside its ea rlier ruling striking the witness and-5- exhibit lists, as well as the previous ruling dismissing the la wsuit with the attachment of conditions to any new action.

On January 8, 2014, the trial court held a hearing on plaintif fs’ motion for relief from judgment. The trial court admonished plaintiffs’ counsel, as a n attorney who practiced in the Oakland County Circuit Court, for failing to comply with the e- filing registration requirement, noting that filers are warned that they will not receive copies of court orders if they fail to register their e-mail address as a service contact. The trial court indicated that “[n]either the Court nor the county clerk provi de[s] free copies of opinions, orders, or other electronically filed documents to an attorney or party who fails to properly registe r with the Odyssey File & Serve application.” The trial court pr oceeded to question plaintiffs ’ counsel in regard to the computergenerated service details, whic h indicated that numerous filing s had been e-mailed to and opened by counsel’s office and that, according to the court, showed th at someone on plaintiffs’ behalf had opened the e-file or e-mail with respect to the court-origi nated scheduling order. Counsel was baffled and explained to the court, “I don’t know how to op en something and look at a scheduling order . . . .” We note that, as indicated above, th e various e-filings that had indeed been opened via plaintiffs’ couns el’s e-mail address had been e -mailed to counsel as the result of defendant manually adding counsel as a service contact as to defendant’s court e-filings . But the scheduling order originated from the trial court, not defendant ’s counsel. And the trial court’s reference to someone on plaintiffs’ behalf opening the e-mail r evealing the scheduling order was simply inaccurate, where it was actually a second person from the law firm representing defendant who had opened it after defense counsel himself had e arlier opened the e-mail. 7

The trial court next indicated that plaintiffs’ motion was mor e accurately coined a motion for reconsideration and that p laintiffs’ counsel acknowledged b eing aware of the registration requirement and simply failed to comply. The trial court then immediately concluded his ruling, stating:

However, as the Court noted, upo n reviewing the history for se rvice details and pleadings in this case, it appears that while no fi rm was specified to receive documents filed, that each – in each instance when a do cument was eserved that someone related to counsel’s client opened the plea dings on each occasion that they were filed.

At this point, a discussion ens ued regarding the fact that no order had been entered on the trial court’s previous ruling. T he trial court then signed a h astily-drafted, handwritten order that denied plaintiffs’ motion for rel ief from judgment and which further provided:

7 Upon examination of the service-d etail records, the scheduling order was opened on the date it was e-filed under the e-mail address of the particular defense attorney representing defendant at the time. And on the following day, the e-filed scheduling ord er was opened under an e-mail
address with the same e-mail extension as defense counsel and i n the name of a person who throughout a portion of the litigation was identified as servin g documents to plaintiffs on behalf of defendant; we assume this was a secretary or paralegal emplo yed by the firm representing
defendant.-6- It is further ordered that this case is dismissed without prej udice & costs on the condition that all dates specified in the May 28, 2013 s cheduling order and also the December 4, 2013 order st riking Pl’s witness & exhibitlists shall apply to any subsequently filed lawsuits. This is a final order and disp oses [of] all claims and parties.

Plaintiffs appealed as of right. On appeal, plaintiffs argue that the trial court erred in striking their witness and exhi bit lists, and in subsequently i mposing a sanction for plaintiffs’ failure to timely file those lists, which forever precluded pla intiffs from introducing evidence in support of their claims. Plaintiffs contend that the failure t o file the witness and exhibit lists was due solely to an inadvertent and unintentional mistake, rather than willfulness, that there was no demonstrable prejudice to defendant, and that there had been no history in the case of a failure to comply with discovery reque sts and court orders.

We find it necessary to first construct the proper analytical framework for purposes of addressing this appeal. MCR 2.401 governs scheduling orders, w hich can encompass the setting of deadlines for the exchange and filing of witness and exhibit lists, MCR 2.401(B)(2)(a). And under MCR 2.401(I)(2), a trial court “may order that any witnes s not listed in accordance with this rule will be prohibited fr om testifying at trial except up on good cause shown.” 8 While MCR 2.401 does not expressly address exhibit lists, a trial court c ertainly also has the discretion to
strike an exhibit list that is not filed in conformance with a scheduling order. See EDI Holdings, LLC v Lear Corp , 469 Mich 1021; 683 NW2d 146 (2004) (trial court did not abuse its discretion when it enforced a summary disposition scheduling order); see a lso MCR 2.313(B)(2)(b) (court has the authority to prohibit the introduction of matters into evidence for discovery violations). 9 Considering that a plaintiff in a civil action has the burden o f proof, there can be no reasonable dispute that when a plaintiff’s witness and exhibit lists are struck, thereby precluding testim ony and the introduction of evidence, the plaintiff’s action is doo med and unsustainable. See Duray Dev, LLC v Perrin, 288 Mich App 143, 164; 792 NW2d 749 (2010) (“Disallowing a par ty to call witnesses can be a severe punishment, equivalent to a dismissal .”); Grubor Enterprises, Inc v

8 We note that MCR 2.401(I)(1) provides in part:

No later than the time directed by the court under subrule (B) (2)(a), the parties shall file and serve witn ess lists. The w itness list mu st include:

(a) the name of each witness, and the witness' address, if kno wn; however,
records custodians whose testim ony would be limited to providin g the foundation
for the admission of records ma y be identified generally;

(b) whether the witness is an e xpert, and the field of experti se.

9 Exhibit and witness lists are an element of discovery. Grubor Enterprises, Inc v Kortidis , 201 Mich App 625, 628; 506 NW2d 614 (1993).-7- Kortidis , 201 Mich App 625, 628; 506 NW2d 614 (1993) (“[D]isallowing th e parties to testify
when the witness list is strick en or prevented f rom being filed is the equivalent of a dismissal.”).

We confidently assume that had plaintiff here not swiftly file d the motion for voluntary dismissal following entry of the order striking the witness and exhibit lists, defendant would certainly have filed a motion for involuntary or summary dismis sal. The trial court’s order striking plaintiffs’ witness and exhibit lists had the practica l effect of dismissing their lawsuit. And the subsequent ruling expre ssly dismissing plaintiffs’ acti on, while flowing from plaintiffs’ motion for voluntary dismissal, was truly in the nature of an i nvoluntary dismissal. See MCR 2.504(B)(1) (“If a party fails to comply with these rules or a court order, upon motion by an opposing party, or sua sponte, the court may enter a . . . dism issal of the noncomplying party's action or claims.”). Moreover, for the reasons stated above, a lthough the dismissal was deemed to be “without prejudice,” the dismissal was effectively “with prejudice,” in light of the fact that any future action by plaintiffs w ould be saddled with the condi tion that they could not present the testimony of witnesses, nor intr oduce exhibits, at trial, neces sarily leading to dismissal of any suit on a theory comparable to res judicata or collateral estop pel. In sum, the proper analysis requires treating the trial court’s rulings as having resulted in an involuntary dismissal with prejudice, with the ultimate question being whether the trial c ourt erred in striking the witness
and exhibit lists.

“This Court reviews for an abus e of discretion a trial court’ s decision to bar witness testimony after a party has failed to timely submit a witness l ist.” Duray Dev

, 288 Mich App at 162. We note that the language of MCR 2.401(I)(2) indicating t hat a court “ may order” (emphasis added) the preclusion of a witness’s testimony supports the imposition of the abuseof-discretion standard. And an a buse of discretion exists when a trial court’s decision falls outside the range of reasonabl e and principled outcomes. Maldonado v Ford Motor Co, 476 Mich 372, 388; 719 NW2d 809 (2006). We see no reason to conclu de that a trial court’s decision to strike an exhibit list implicates a different stand ard of review; therefore, we likewise apply the abuse of discretion st andard to the court’s decision to strike the exhibit list. See EDI Holdings , 469 Mich at 1021. In the context of this case, the trial court essentially sanctioned plaintiffs by striking the witnes s and exhibit lists, and in do ing so the court made some underlying factual findings with r espect to the conduct of plai ntiffs’ counsel, which findings we review for clear error. MCR 2.613(C) (“Findings of fact by the trial court may not be set aside unless clearly erroneous.”); Kitchen v Kitchen , 465 Mich 654, 661; 641 NW2d 245 (2002). “A decision is clearly erroneous w here, although there is evidence to support it, the reviewing court
is left with a definite and firm conviction that a mistake has been made.” Kitchen , 465 Mich at

661-662.

The language of MCR 2.401(I)(2) indicates that a trial court m ay contemplate striking a
witness list for violation of its scheduling order, “except upo n good cause shown” for the noncompliance. Accordingly, the first step in the analysis is to examine whether there was “good cause” for plaintiffs’ failure to comply with the schedul ing order, which, if established, would require reversal, and, if not established, would require examination of whether the decision to impose sanctions nevertheless constituted an abuse of discretion under the
circumstances. The trial court d id not find acceptable or excu sable the failure by plaintiffs’ counsel to register his e-mail address as a service contact, wh ich led to the service failure. We do note that while we understand and appreciate the rule implem ented by the Oakland Circuit-8- Court under the authority of AO 2007-3 that a party must regist er an e-mail address as a service contact or else the party will no t be served with court orders, it would seem that when it comes to something as important as a sche duling order, the court’s e-fil er might as a courtesy, if at all feasible and conducive to the system, simply contact counsel to make him or her aware of any registration failure. Plaintiffs’ complaint listed the e-mail address, phone number, and business address of counsel. That said, we do agree with the trial cour t that counsel had an obligation to know and comply with the court’s rules on e-filing. We also no te that although the deadline for filing the witness and exhibit li sts had already passed at the end of August 2013, plaintiffs’ counsel in late September 2013 and early October 2013 did not a ppear to make any inquiries to the court about any scheduling or der or rush to file the lists despite having knowledge of
defendant’s motion to extend deadlines and the resulting ruling. We conclude that plaintiffs have not shown “good cause” for failing to comply with the sche duling order with respect to the deadline for filing and exchangi ng witness and exhibit lists. And plaintiffs do not appear to even argue that “good cause” existed for the noncompliance. Rather, plaintiffs’ argument is focused on the claim that the sanction, effectively a dismissal of plai ntiffs’ suit with prejudice, was not proper in light of all of the c ircumstances and the lack of pre judice to defendant.

Moving to the issue regarding whether the trial court abused i ts discretion in striking the witness and exhibit lists and in effectively dismissing plainti ffs’ suit with prejudice, we first note an underlying factual error made by the trial court, alluded to above, that the e-filed scheduling order had been opened by someone on plaintiffs’ behalf. For th e reasons discussed earlier, this finding was clearly erroneous, where it was two members of the law firm representing defendant that had opened e-mails pertaining to the scheduling order, or someone with access to their email accounts, and not anyone on plaintiffs’ behalf. Further, the trial court appeared to place a great emphasis on its mistaken finding in rendering its decisio n, which in and of itself mandates reversal. Additionally, the trial court did not undertake the required analysis discussed in Duray

Dev , wherein this Court observed:

Once a party has failed to file a witness list in accordance w ith the scheduling order, it is within the trial court's discretion to impose sanctions against that party. These sancti ons may preclude the party from calling witnesses. Disallowing a party to call witnesses can be a severe punishmen t, equivalent to a
dismissal. But that . . . does not mean that . . . a trial cour t cannot impose such a sanction even if it is equivalent to a dismissal. Because the d ecision is within the trial court's discretion, caselaw mandates that the trial court consider “the
circumstances of each case to determine if such a drastic sanct ion is appropriate.” “[T]he record should reflect that the trial court gave careful
consideration to the factors i nvolved and considered all of its options in determining what sanction was just and proper in the context of the case before
it.” Relevant factors can inc lude, but are notlimited to,

“(1) whether the violation was wilful or accidental; (2) the p arty's history of refusing to comply with discovery requests (or refusal to di sclose witnesses); (3) the prejudice to the defenda nt; (4) actual notice to the de fendant of the witness and the length of time prior to trial that the defendant receiv ed such actual notice; (5) whether there exists a hi story of plaintiff's engaging in d eliberate delay; (6) the degree of compliance by the plaintiff with other provisions of the court's order;-9- (7) an attempt by the plaintiff to timely cure the defect[;] an d (8) whether a lesser sanction would better serve the interests of justice. This list should not be
considered exhaustive.”

. . .

Here, the record does not reflect that the trial court gave co nsideration to these factors or considered all of its options in determining w hat sanction was just and proper in the context of the case before it. Therefore, on remand the trial court should reassess [the] request to testify, taking the above-ment ioned factors into consideration and explaining its determination on the record. [ Duray Dev , 164- 166 (citations omitted; initial t wo alterations in original).]

Here, given the trial court’s erroneous factual finding regard ing who opened the e-filed scheduling order, and given the trial court’s failure to give c onsideration, let alone careful consideration, to the factors set forth in Duray Dev , we reverse and remand for further proceedings. Just as ordered in Duray Dev , we direct the trial court to consider the relevant factors and to explain its ultimate ruling on the record.

Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction. We decline to award taxable costs under M CR 7.219.

/s/ William B. Murphy /s/ Cynthia Diane Stephens
/s/ Michael F. Gadola