Court Opinion

ID: 2823350
Source: CourtListenerOpinion
Date Created: 2015-07-31 12:10:49.17334+00
Date Added: 2024-06-11T13:39:16.776926
License: Public Domain

STATE OF MICHIGAN

                            COURT OF APPEALS

HOWARD & HOWARD ATTORNEYS,                                           FOR PUBLICATION
P.L.L.C.,                                                            July 30, 2015
                                                                     9:00 a.m.
               Plaintiff/Counter-Defendant-
               Appellant,

v                                                                    No. 320291
                                                                     Oakland Circuit Court
PETER JABBOUR,                                                       LC No. 2012-128121-CK

               Defendant/Counter-Plaintiff-
               Appellee.

Before: WILDER, P.J., and SHAPIRO and RONAYNE KRAUSE, JJ.

PER CURIAM.

        Plaintiff appeals by right the trial court’s denial of its motion for summary disposition
and grant of summary disposition in favor of defendant. Defendant was appointed by the trial
court to a receivership to oversee certain businesses involved in an underlying lawsuit; as part of
his receivership, he retained plaintiff to perform legal services in connection with the
receivership. The receivership appointment order specified that the receivership estate was to
pay the receiver’s fees and expenses, including compensating plaintiff. However, the parties to
the underlying lawsuit settled and, despite being ordered to do so, never paid the entirety of
plaintiff’s fees. Plaintiff commenced the instant suit against defendant personally, which the trial
court deemed impermissible. We affirm.

       The trial court’s ruling on a motion for summary disposition is reviewed de novo on
appeal. Oliver v Smith, 290 Mich. App. 678, 683; 810 NW2d 57 (2010).

        A party who retains attorneys such as plaintiff would, of course, ordinarily be obligated
to compensate those attorneys pursuant to their contract. However, an agent who contracts with
a third party on behalf of a disclosed principal is generally not liable to the third party in the
absence of an express agreement to be held liable. Nat’l Trout Festival, Inc v Cannon, 32 Mich
App 517, 521; 189 NW2d 69 (1971); Huizenga v Withey Sheppard Assoc, 15 Mich. App. 628,
633; 167 NW2d 120 (1969). A court-appointed receiver is an officer or agent of the court. In re
Kennison Sales & Engineering Co, Inc, 363 Mich. 612, 618; 110 NW2d 579 (1961). The order
of appointment explicitly so states. In accord is authority stating:

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              One who contracts with the court through the receiver becomes, in effect,
       a party to the receivership proceedings in respect of the court’s future dealings
       with him or her and his or her rights under the contract. [75 CJS, Receivers, §
       165, pp 509-510.]

Similarly:

               The general rule is that an allowance of attorney fees in cases of this
       nature is properly made to the receiver and not directly to the attorneys, and that
       the attorneys must look to the receiver for their compensation, but they cannot
       hold the receiver personally liable. [65 Am Jur 2d, Receivers, § 225, pp 780-
       781.]

The parties’ contract in this case explicitly and unambiguously stated that all legal services were
being performed pursuant to defendant’s appointment by the trial court as receiver. There is no
plausible dispute that defendant was lawfully acting within the scope of his receivership
authority at all relevant times and that plaintiff was aware of that fact.

        Defendant did agree that plaintiff is entitled to be paid. However, the evidence shows
that defendant did not concede that he was obligated to make that payment personally. Plaintiff
apparently believes that defendant’s concession established an account stated. See Fisher Sand
& Gravel Co v Neal A Sweebe, Inc, 494 Mich. 543, 554-555; 837 NW2d 244 (2013) (explaining
that an open account is converted into an account stated when the parties agree to a sum due
from one to another). Defendant did not agree that he owed the sum; only that plaintiff was
owed it. In any event, defendant’s alleged liability is predicated on the agreement to pay for
services rendered to him as receiver under the retainer agreement and, as discussed above,
defendant is not personally liable for those services.

        The trial court properly granted summary disposition in favor of defendant and properly
denied summary disposition to plaintiff. In light of our conclusion that defendant cannot be held
personally liable for the amount due plaintiff on these facts, we need not address the remaining
issues plaintiff raises on appeal. Affirmed.

                                                            /s/ Kurtis T. Wilder
                                                            /s/ Douglas B. Shapiro
                                                            /s/ Amy Ronayne Krause

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