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### STATE OF MICHIGAN

COURT OF APPEALS

ESTATE of FRANKLIN A. DENISON, SR., by DENNIS DELONG, Personal Representative,

Plaintiff/CounterDefendant/Appellant/CrossAppellee, UNPUBLISHED January 21, 2016

v No. 323594 Allegan Circuit Court PALM BEACH POLO HOLDINGS, INC., LC No. 05-038095-CH

Defendant/CounterPlaintiff/Appellee/ Cross-Appellant,

and

KK AGGREGATES, INC.,

Defendant/Counter-Plaintiff.

Before: B ECKERING , P.J., and G LEICHER and M. J. K ELLY , JJ.

P ER C URIAM

. In a prior appeal, this Court re versed the trial court’s judgm ent of no cause of action for the plaintiff estate’s unjust en richment claim and remanded for entry of a damages award consistent with the estate’s evidence. Denison Estate v Palm Beach Polo Holdings, Inc
, unpublished opinion per curiam of the Court of Appeals, issued June 24, 2010 (Docket No. 284444) ( Denison Estate I ). On remand, the trial court en tered an award in the estate’s favor, but denied the estate’s request for attorney fees and costs. The t rial court erroneously concluded that its jurisdiction was so limited by our remand as to preclude co nsideration of such an award. Accordingly, we reverse that por tion of the lower court’s order and remand for consideration of the estate’s request.

Palm Beach Polo Holdings, Inc. cross-appeals, contending that interest should not accrue on the judgment beyond May 25, 2012, the date on which it tende red a settlement offer to the estate. Palm Beach further contends that the unjust enrichment award should have been reduced by half because the estate owned only 50% of the subject leaseh old, the other half belonging to-2- Franklin Denison’s spouse’s trust. We discern no error in thes e regards and therefore affirm the interest award and the judgement amount.

I. BACKGROUND

In the 1990s, the deceased and h is wife—the Denisons—owned pro perty along the Kalamazoo River in Saugatuck, which they leased to their compan y, Broward Marine. In 1998, Palm Beach purchased Broward and took over the lease, paying $2 5,240 in annual rent to the Denisons. Denison Estate I , unpub op at 1. At some point, the Denisons died; Mr. Denison ’s half of the leasehold interest flowed into his estate and Mrs. Denison’s into her trust. And in 2002, Palm Beach moved its business to Florida. Id. at 1-2.

The Master Lease did not describe the property, reciting only the address. Id. at 1. In 2002, Palm Beach filed suit against the estate, as well as Mrs. Denison’s trust, seeking a judicial declaration regarding the propert y’s dimensions. During that s uit, Palm Beach subleased the property for $100,000 annually. The sublease described the pro perty as including 575 feet of river frontage and held Palm Beach harmless in the event the co urt reached a different conclusion in its suit against the estate. Id. at 2.

The trial court eventually orde red reformation of the sublease to reflect that the property was 3.08 acres with 235 feet of ri verfront, rather than 5.1 acr es with 575 feet of river frontage. The court reduced the sublessee’s rent obligation by 25% and ma de the order retroactive to May 2005. Palm Beach therefore owed the sublessee a refund of rent s. The sublessee was thereafter evicted from the property but Denison Estate I is silent regarding the reason and party behind the eviction. Id.

The estate and Mrs. Denison’s trust apparently owned the remai ning 340 feet of riverfront and 2.02 acres of land free from any leasehold inter est. In July 2005, the estate filed the suit underlying this appeal and raised claims of breach of contract, unjust enrichment, constructive trust, and trespass. The estate sought that porti on of the rent paid for the land outside the leasehold, as well a s unpaid rents under the origin al agreement with Palm Beach. It also sought damages for Palm Beach’s improper assignment of par t of its interest to KK Aggregates. The estate accused Palm Beach of a continuing tres pass and damage to property outside the leasehold, in connect ion with actions by the subles see. Id.

Early in the proceedings, the court granted partial summary di sposition in the estate’s favor in relation to unpaid rents amounting to $76,350. Follow ing a bench trial, the court ruled that Palm Beach had breached its contract and committed three t respassory acts, but awarded only $5. The court found no cause of action as to the construc tive trust claim. Id. In relation to unjust enrichment, the court held that Palm Beach “was unjustly enriched, as a matter of fact.” Id. However, the court found no cause of action because the estat e “failed to submit any evidence” regarding damages. Id. at 2-3.

In Denison Estate I , the estate appealed the trial court’s judgment. This Court c oncurred with the estate that it presented evidence regarding the extent of Palm Beach’s unjust enrichment before May 2005—25% of the rent paid by the sublessee based on Palm Beach’s incorrect-3- description of the property. Id. at 4. This Court affirmed the t rial court’s rulings in relati on to the constructive trust and trespass claims. Id. at 5-7.

While the appeal in Denison Estate I was pending, the trial court entertained the estate’s motion for attorney fees and costs. The Master Lease provided, “The prevailing party in any litigation hereunder shall be ent itled to recover its reasonabl e attorneys’ fees and costs, including any appeals.” The trial court identified the estate as the pre vailing party in the suit. Accordingly, the court awarde d the estate $97,027.42 in attorne y fees and costs. The December 9, 2008 order provided, “All ruling s herein are made without pr ejudice to [the estate’s] right to seek further reimbursement from [Palm Beach] for other attorney s’ fees and costs incurred by [the estate].” The court “retain [ed] jurisdiction to consider and rule on any such further requests.”

II. POST-APPEAL PROCEEDINGS

Following our resolution of Denison Estate I , the trial court heard argument on the issue of the estate’s unjust enrichment damages. Palm Beach contende d that the estate was entitled to only half of any calculated damages because it possessed only a 50% interest in the property and Mrs. Denison’s trust was not a party to the suit. The court re jected that argument as untimely raised and then valued the damages at $65,031.25. The court al so ordered that prejudgment interest applied, over Palm Beach’s objection, and calculated t hat award at an additional $110,515.09.

On remand, the estate also sought additional attorney fees and costs incurred after the December 2008 award, including those fees and costs amassed dur ing the first appeal. The trial court denied the estate’s request , noting first that this Court held in Denison Estate I , unpub op at 7: “No taxable costs pursuant to MCR 7.219, neither party havin g prevailed in full.” Further, awarding fees and costs incurred after the first appeal went be yond the scope of the remand, the trial court concluded.

Both parties have now appealed t he trial court’s orders entere d after the first appeal. The estate contends that the trial court should have continued asse ssing attorney fees and costs after its December 2008 order. Palm Beach contends that it made a bo na fide offer of settlement on May 25, 2012, and it was improper to calculate interest beyond that date. Palm Beach also continues to assert that the estate is entit led to only 50% of the unjust enrichment award.

III. ATTORNEY FEES AND COSTS

The trial court erred in determining that it lacked jurisdicti on to consider and award continuing attorney fees and costs. Our remand order did not p revent the court from acting and our refusal to tax costs under MCR 7.219 is not dispositive of the estate’s contract-based request.

Whether a court possesses jurisd iction over a matter presents a question of law that we review de novo. In re Contempt of Dorsey , 306 Mich App 571, 580-5 81; 858 NW2d 84 (2014). The trial court granted the estate’s request for attorney fees and costs as permitted by the Master Lease on December 9, 2008. Palm Beach did not file its brief a s appellee in Denison Estate I until nearly a month later. Palm Beach did not seek to file a cross-appeal in the prior appeal, nor did it challenge the application of the contractual attorney fe e provision. As a result, our-4- decision in Denison Estate I makes no mention of that award and reaches no conclusion on th at issue. The Master Lease provision permitting the assessment of attorney fees and costs and the trial court’s reliance on that provision simply were not on our radar; we had no reason to include specific language permitting th e trial court to continue consid ering the issue on remand. Therefore, the trial court read Denison Estate I too narrowly in determining that it lacked jurisdiction ove r this issue.

Furthermore, the trial court specifically retained jurisdictio n to consider future requests for accumulating attorney fees and costs. Again, our opinion i n Denison Estate I in no way questioned or cut off that juris diction. In fact, the attorney fees and costs in this matter are an element of damages , and this Court remanded for the trial court to consider the p roper damages connected to the unjust enrichment judgment. See Denison Estate I , unpub op at 4. See also Fleet Business Credit v Krapohl Ford Lincoln Mercury Co , 274 Mich App 584, 589; 735 NW2d 644 (2007) (“[A]ttorney fees award ed under such contractual pro visions are considered damages, not costs.”).

In Denison Estate I , unpub op at 7, we did decline to tax costs under MCR 7.219 as neither party had prevailed in full. That is not dispositive h ere. It is well established that to tax appellate costs under th e court rule, a party must have prevail ed in full. But to collect attorney fees and costs under contractual provisions and statutes, and e ven under other court rules, the bar is not so high to be considered a prevailing party. For exampl e, this Court has only required a prevailing party to “fully” prevail for purposes of collecting attorney fees when the statute underlying the award requires such resounding success. See Peters v Gunnell, Inc , 253 Mich App 211, 222-223; 655 NW2d 582 (2002) (in which this Court deni ed the plaintiff attorney fees under the sales representative commissions act because the act defined a “prevailing party” as one “who wins all the allegations of the complaint or on all of the responses to the complaint”). The current contract did not require a party to prevail in full in order to collect attorney fees and costs and so the estate is entitled to continuing reimbursement . Our rejection of taxed costs in the prior appeal is, however, the law of the case. See Ashker v Ford Motor Co , 245 Mich App 9, 13; 627 NW2d 1 (2001). Accordingl y, although we reverse the tr ial court’s judgment denying continuing attorney fees and costs and remand for further consi deration, the trial court may not award those costs accrued during t he prior appeal that are list ed in MCR 7.219(F) and (G).

IV. PREJUDGMENT INTEREST

We discern no error, however, in the trial court’s assessmen t of prejudgment interest as Palm Beach did not make a “bona fide, reasonable” offer of sett lement that was rejected by the
estate.

We review de novo the trial cour t’s interpretation and applica tion of MCL 600.6013. See Castillo v Exclusive Builders, Inc , 273 Mich App 489, 492; 733 NW2d 62 (2007). MCL 600.6013 provides, in relevant part:

(9) If a bona fide, reasonable written offer of settlement in a civil action based on tort is made by the part y against whom the judgment is subsequently rendered and is rejected by the pl aintiff, the court shall orde r that interest is not-5- allowed beyond the date the bona fide, reasonable written offer of settlement is filed with the court.

* * *

(15) As used in this section:

(a) “Bona fide, reasonable written offer of settlement” means either of the following:

( i ) With respect to an offer of settlement made by a defendant ag ainst whom judgment is subsequently rendered, a written offer of sett lement that is not less than 90% of the amount actually received by the plaintiff in the action through judgment.

On May 25, 2012, after this Court held that plaintiff was entitled to unjust enrichme nt damages but before the trial court calculated those damages on remand, Palm Beach served on the estate an offer to stipulate to an entry of judgment which included $64,309.85 for unjust enrichment and $20,000 in attorney fees, for a total of $84,309 .85. The estate rejected that offer. At that time, the trial court had already ordered Palm Beach to pay the estate $97,027.42 in attorney fees. Palm Beach’s offer to settle the attorney fee i ssue was less than 20% “of the amount actually received by the plaintiff in the action through judgment.” The offer to settle the unjust enrichment damages was comparable to the $65,031.25 ulti mately calculated by the court. As correctly noted by the trial court, however, the total judgm ent in this case includes a combination of the two awards, and the settlement offer was far below that figure—the settlement was only 52.02% of the combined judgment to be exact . Accordingly, Palm Beach cannot avoid the accrual of prej udgment interest under the stat ute.

V. JUDGMENT AMOUNT

Finally, Palm Beach contends tha t the trial court should have reduced the unjust enrichment damages award by 50% because the estate held only a half interest in the leasehold. We review a trial court’s damage award in a bench trial for cle ar error. Marshall Lasser, PC v George , 252 Mich App 104, 110; 651 NW2d 158 (2002). “Clear error exi sts where, after a review of the record, the reviewing court is left with a firm a nd definite conviction that a mistake has been made.” Id . In this case, however, the trial court determined that the i ssue was legally barred by waiver, a question which we review de novo. See Angott v Chubb Group Ins , 270 Mich App 465, 469-470; 717 NW2d 341 (2006).

Palm Beach waived its challenge because it failed to assert th is defense in its responsive pleading at the outset of this litigation. MCR 2.111(F)(2)-(3) provide that a defendant must state all defenses, affirmative or otherwise, in its responsive plead ing, or the issue will be deemed waived. See Electrolines, Inc v Prudential Assurance Co , 260 Mich App 144, 164; 677 NW2d 874 (2003). In Palm Beach’s affirmative defenses, it stated th at the estate had failed to include all necessary parties, but did not identify those parties who s hould have been added. This was insufficient to preserve Palm Beach’s challenge on the eve of j udgment. Palm Beach did not identify Gerturde Denison or her trust as a part owner of the l easehold, despite tha t she was listed as a named party on the Master Lease. The pleading therefore d id not suffice to place the estate-6- on notice of this defense. See Stanke v State Farm Mut Auto Ins Co , 200 Mich App 307, 318; 503 NW2d 758 (1993) (“Just as the plaintiff must plead somethin g beyond a general the ‘defendant injured me,’ the defendant must plead something more specific than ‘I deny I’m liable.’ ”).

Even if the issue were not deemed waived, we would find that P alm Beach had abandoned it. In its 2006 respons e to the estate’s first motio n for partial summary disposition related to Palm Beach’s alleged failure to remit its rent oblig ations, Palm Beach noted that the estate would not be entitled to 100% of the rents because it wa s only a “co-landlord.” The trial court implicitly rejected that argument when it awarded the est ate $73,350 in unpaid rents, the full amount requested. Despite this adverse ruling, Palm Beach did not file a cross-appeal or challenge that ruling during the prior appeal. Palm Beach aban doned its challenge by failing to include it in that appeal. See English v Blue Cross Blue Shield of Mich , 263 Mich App 449, 458- 459; 688 NW2d 523 (2004).

We affirm in part, reverse in part, and remand for further pro ceedings consistent with this opinion. We do not retain jurisdi ction. As the estate prevail ed in full in this appeal, it may now tax costs pursuant to MCR 7.219.

/s/ Jane M. Beckering /s/ Elizabeth L. Gleicher /s/ Michael J. Kelly