Court Opinion

ID: 4705941
Source: CourtListenerOpinion
Date Created: 2021-07-23 09:08:31.643904+00
Date Added: 2024-06-11T08:06:25.921151
License: Public Domain

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
                 revision until final publication in the Michigan Appeals Reports.

                           STATE OF MICHIGAN

                           COURT OF APPEALS

NICHOLE ROLFE,                                                       UNPUBLISHED
                                                                     July 22, 2021
               Plaintiff-Appellant/Cross-Appellee,

v                                                                    No. 352005
                                                                     Genesee Circuit Court
BAKER COLLEGE,                                                       LC No. 15-104587-CK

               Defendant-Appellee/Cross-Appellant.

Before: BORRELLO, P.J., and SERVITTO and STEPHENS, JJ.

PER CURIAM.

        Plaintiff-appellant/cross-appellee (plaintiff), Nichole Rolfe, appeals as of right, and
defendant-appellee/cross-appellant (defendant), Baker College, cross-appeals as of right, the trial
court’s order awarding defendant $9,500 in case evaluation sanctions. For the reasons set forth in
this opinion, we reverse.

                                       I. BACKGROUND

       This matter has previously been before this Court, and we quote from this Court’s prior
opinion in this matter for purposes of providing relevant factual background:

               Plaintiff was enrolled in defendant’s nursing program. Approximately six
       months into her tenure as a student in defendant’s program, plaintiff was subjected
       to discipline from defendant’s nursing director. As part of that discipline, plaintiff
       signed a “behavior contract” that would permit her dismissal from defendant’s
       program if she continued to demonstrate “improper professional behavior.”
       Plaintiff was subsequently discharged from the program for violation of the
       behavior contract based on conduct that defendant characterized as “[d]isrupting
       the learning environment . . . by continuously arguing . . . about a personal belief
       regarding immunizations,” “persistent, aggressive, oppositional behavior . . . by
       student in clinical group setting . . . disrupting the clinical learning environment,”
       and “abrasive and unprofessional” email communications to an instructor.

                                                -1-
        Plaintiff filed suit, asserting breach of express or implied contract claims.
In response to defendant’s motion for summary disposition, plaintiff asserted that
her damages included “future lost wages” based on the full wages of a professional
midwife for 30 years, in the amount of $97,700 per year for 30 years; plaintiff
calculated her total damages at over three million dollars. Defendant filed motions
in limine seeking to restrict plaintiff’s damages to the cost of the tuition she had
paid to defendant, which according to defendant was at most $9,270.85. After
several motion hearings, the trial court granted summary disposition in favor of
defendant on most of plaintiff’s claims, including her claim for breach of “the
covenant of good faith and fair dealing,” but denied summary disposition regarding
plaintiff’s claim for breach of the behavior contract. The trial court also issued an
opinion and order limiting plaintiff’s recoverable damages to “the cost of
education,” thereby excluding such other claimed damages as future lost wages,
stating in relevant part:

       Plaintiff may recover, if and when proven, the costs of her education
       in a sense broader than tuition and books but limited to what she
       actually paid. If she paid with borrowed funds, such funds are a
       measure of damages, so long as she is obligated to pay them back.
       To the extent she is not required to pay them back but she is
       precluded from obtaining additional funds (e.g. a one-time grant)
       her inability to reacquire funds to pay for an education elsewhere
       formulates an aspect of her damages.

         Before trial, the parties stipulated to the entry of a final judgment in favor
of plaintiff and against defendant with regard to plaintiff’s claim that defendant had
breached the behavior contract, and to the dismissal of plaintiff’s other claims, with
a stipulated damages amount of $15,000 plus a waiver of any remaining debt owed
by plaintiff to defendant. The consent judgment reserved plaintiff’s right to appeal
the trial court’s limitation of her damages. [Rolfe v Baker College, unpublished per
curiam opinion of the Court of Appeals, issued May 7, 2019 (Docket No. 340158),
pp 1-2 (ellipses in original).]

The consent judgment specifically provided as follows:

        Based upon the prior opinions and/or decisions of this trial court, the parties
agree to entry of a final judgment in favor of Plaintiff, NICHOLE ROLFE, and
against Defendant, BAKER COLLEGE, in the stipulated amount of $15,000.00
(inclusive of all assessable costs and interest) as to Count II of the First Amended
Complaint, together with a waiver by Baker College of any and all debt that
Plaintiff, NICHOLE ROLFE owes Defendant, BAKER COLLEGE.

        It is further agreed and understood that Plaintiff will appeal (and prosecute
through completion) this Judgment as a matter of right, which includes any and all
prior decisions of the trial court, including any damages limitation decreed by this
trial court (specifically including the Order Regarding Summary Disposition and
Motion in Limine, dated September 1, 2016). This Court declares that all prior

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         issues raised and/or resolved via prior decisions are fully preserved for appellate
         purposes and not waived by this final judgment.

                It is also agreed and understood that if Plaintiff fails to appeal as stated
         above or if she fails to take any act necessary to prosecute that appeal to final
         adjudication, Plaintiff is ordered to tender to Baker College a Satisfaction of
         Judgment, signed by Plaintiff, for the full Judgment amount.

                THEREFORE, IT IS HEREBY ORDERED AND ADJUDGED that a final
         judgment is hereby entered in favor of Plaintiff, NICHOLE ROLFE, and against
         Defendant, BAKER COLLEGE, in the amount of $15,000.00 (inclusive of
         assessable costs and interest) as to Count II of the First Amended Complaint, which
         sum shall be paid as follows:

              (a) BAKER COLLEGE shall pay the sum of $2,250.00 to Plaintiff,
         NICHOLE ROLFE, within 7 days from the date of this Judgment; and

                (b) BAKER COLLEGE shall pay the sum of $12,250.00 to the Simen,
         Figura & Parker, PLC[1] Client Trust Account where it shall remain pending further
         order of the Court.

                IT IS ALSO ORDERED that the unpaid portion of the Judgment for
         $12,250.00 shall not be paid or collected upon until (1) Plaintiff’s appeal is
         prosecuted to final adjudication; and/or (2) the trial court resolves any motion for
         case evaluation sanctions brought by BAKER COLLEGE following prosecution of
         an appeal that NICHOLE ROLFE files.

                IT IS ALSO ORDERED AND ADJUDGED THAT BAKER COLLEGE
         hereby waives and forgives any and all debt that Plaintiff, NICHOLE ROLFE owes
         Defendant, BAKER COLLEGE.

                 The parties further agree that this Final Judgment entered as a result of
         rulings by the court on motions filed by Baker College after case evaluation,
         specifically (but not limited to) Baker College’s motion for summary disposition
         and motions in limine concerning Plaintiff’s damages.

                Any request for case evaluation penalties by BAKER COLLEGE will not
         be sought until after a final adjudication of Plaintiff’s appeal and any case
         evaluation sanctions ordered by the Court shall not exceed the Judgment amount of
         $15,000.00.

                 This is a final order conferring the right to appeal and closes the case.

1
    This law firm represented Baker College.

                                                  -3-
        As alluded to previously, plaintiff appealed this final judgment. Rolfe, unpub op at 1-2.
This Court affirmed, holding in relevant part that the trial court did not err by limiting plaintiff’s
damages to the costs of her nursing school education and that the damages sought by plaintiff for
“lost future wages and other damages not directly tied to the expense of her nursing education”
were “not recoverable under Michigan law regarding breach of contract damages.” Id. at 1-3.

        Defendant subsequently filed a motion in the trial court arguing that it was entitled to case
evaluation sanctions under MCR 2.403(O) because the $15,000 case evaluation award had been
rejected by plaintiff and accepted by defendant before the above described consent judgment was
entered.2 Defendant further argued that the final consent judgment provided that the judgment was
entered as a result of the motions filed by defendant after case evaluation. Although defendant
argued that its reasonable attorney fees subsequent to the case evaluation award were $31,678,
defendant sought only $15,000 in case evaluation sanctions on the basis that the final judgment
stated that case evaluation sanctions would be capped at $15,000.

        Plaintiff opposed the motion, arguing first that a consent judgment was not a “judgment”
for purposes of the court rule because the court did not determine the parties’ respective rights and
obligations. Plaintiff also argued that the consent judgment was more than 10 percent higher than
the case evaluation award, and thus more favorable to plaintiff under MCR 2.403(O)(3), because
it included the forgiveness of $2,792 in debt that plaintiff still owed defendant. In the alternative,
plaintiff argued that the trial court could decline to impose sanctions in the interest of justice,
pursuant to MCR 2.403(O)(11); plaintiff maintained that the position advanced through her prior
appeal was premised on an unsettled area of law and a legal issue of first impression. Finally,
plaintiff argued that defendant’s current motion for case evaluation sanctions was frivolous and
designed to harass, such that plaintiff was entitled to sanctions under MCR 1.109(E)(6).

       The trial court granted defendant $9,500 in case evaluation sanctions. This appeal
followed, with plaintiff generally challenging the propriety of awarding case evaluation sanctions
and defendant challenging the trial court’s decision to award less than the full amount of case
evaluation sanctions requested.

                             II. CASE EVALUATION SANCTIONS

                                  A. STANDARD OF REVIEW

        Questions involving the interpretation of court rules are reviewed de novo. Bint v Doe,
274 Mich App 232, 234; 732 NW2d 156 (2007). A trial court’s decision to grant or deny case
evaluation sanctions is also reviewed de novo. Harbour v Correctional Med Servs, Inc, 266 Mich
App 452, 465; 702 NW2d 671 (2005). The amount of a case evaluation sanction award is reviewed
for an abuse of discretion. Peterson v Fertel, 283 Mich App 232, 239; 770 NW2d 47 (2009).
Additionally, “because a trial court’s decision whether to award costs pursuant to the ‘interest of
justice’ provision set forth in MCR 2.403(O)(11) is discretionary, this Court reviews that decision
for an abuse of discretion.” Harbour, 266 Mich App at 465. “An abuse of discretion occurs when

2
 The case evaluation hearing occurred on October 19, 2016. The consent judgment was entered
on August 29, 2017.

                                                 -4-
the trial court’s decision is outside the range of reasonable and principled outcomes.” Peterson,
283 Mich App at 235 (quotation marks and citation omitted).

        Factual findings underlying a trial court’s application of the interest-of-justice exception in
MCR 2.403(O)(11) are reviewed for clear error. Sabbagh v Hamilton Psychological Servs, PLC,
329 Mich App 324, 364; 941 NW2d 685 (2019). “A finding is clearly erroneous when, although
there is evidence to support it, the reviewing court on the entire record is left with a definite and
firm conviction that a mistake was made.” Id. (quotation marks and citation omitted).

        Because “judgments entered pursuant to the agreement of parties are in the nature of a
contract,” this Court reviews de novo questions involving the interpretation of consent judgments
entered by agreement. See Neville v Neville, 295 Mich App 460, 466; 812 NW2d 816 (2012). “In
ascertaining the meaning of a contract, we give the words used in the contract their plain and
ordinary meaning that would be apparent to a reader of the instrument.” Rory v Continental Ins
Co, 473 Mich 457, 464; 703 NW2d 23 (2005).

                                           B. ANALYSIS

       Central to the issues on appeal is MCR 2.403(O),3 which provides in relevant part:

               (1) If a party has rejected an evaluation and the action proceeds to verdict,
       that party must pay the opposing party’s actual costs unless the verdict is more
       favorable to the rejecting party than the case evaluation. . . .

               (2) For the purpose of this rule “verdict” includes,

               (a) a jury verdict,

               (b) a judgment by the court after a nonjury trial,

               (c) a judgment entered as a result of a ruling on a motion after rejection of
       the case evaluation.

                (3) For the purpose of subrule (O)(1), a verdict must be adjusted by adding
       to it assessable costs and interest on the amount of the verdict from the filing of the
       complaint to the date of the case evaluation . . . . After this adjustment, the verdict
       is considered more favorable to a defendant if it is more than 10 percent below the
       evaluation, and is considered more favorable to the plaintiff if it is more than 10
       percent above the evaluation . . . .

                                               * * *

               (6) For the purpose of this rule, actual costs are

3
 None of the quoted provisions were affected by the recent amendment to this court rule. See
Administrative Order No. 2019-09, ___ Mich ___ (2021).

                                                 -5-
               (a) those costs taxable in any civil action, and

               (b) a reasonable attorney fee based on a reasonable hourly or daily rate as
       determined by the trial judge for services necessitated by the rejection of the case
       evaluation, which may include legal services provided by attorneys representing
       themselves or the entity for whom they work, including the time and labor of any
       legal assistant as defined by MCR 2.626.

                                               * * *

              (11) If the “verdict” is the result of a motion as provided by subrule
       (O)(2)(c), the court may, in the interest of justice, refuse to award actual costs.

        Plaintiff first argues that defendant was not entitled to case evaluation sanctions because
the consent judgment in this case did not constitute a “verdict” as that term is defined in MCR
2.403(O)(2). There is no dispute that the only definition of “verdict” implicated by the procedural
facts of this case is MCR 2.403(O)(2)(c), which states that a verdict includes “a judgment entered
as a result of a ruling on a motion after rejection of the case evaluation.” Relying on our Supreme
Court’s decision in Acorn Investment Co v Michigan Basic Prop Ins Ass’n, 495 Mich 338, 354;
852 NW2d 22 (2014), plaintiff maintains that a consent judgment is not a “judgment” for purposes
of MCR 2.403(O)(2)(c) because the parties’ respective rights and obligations are not determined
by the court under a consent judgment.

        “A ‘judgment’ is ‘[a] court’s final determination of the rights and obligations of the parties
in a case.’ ” Acorn, 495 Mich at 351, quoting Black’s Law Dictionary (9th ed) (alteration in
original). However, our Supreme Court explained in Acorn that “a consent judgment is not the
kind of ‘judgment’ required by MCR 2.403(O)(2)(c) because the court does not ‘determine . . . the
rights and obligations of the parties’ in a consent judgment.” Acorn, 495 Mich at 354, quoting
Black’s Law Dictionary (9th ed) (ellipsis in original). Instead, “a consent judgment is a
‘settlement’ or a ‘contract’ ‘that becomes a court judgment when the judge sanctions it.’ ” Acorn,
495 Mich at 354, quoting Black’s Law Dictionary (9th ed). This Court has also explained that “[a]
consent judgment is different in nature from a judgment rendered on the merits because it is
primarily the act of the parties rather than the considered judgment of the court.” Clohset v No
Name Corp (On Remand), 302 Mich App 550, 565; 840 NW2d 375 (2013) (quotation marks and
citation omitted). “Consent decrees differ from typical judgments because the voluntary nature of
a consent decree is its most fundamental characteristic.” Id. (quotation marks and citation
omitted).

        In this case, the final judgment was entered as a result of the parties’ mutual agreement to
stipulate to a consent judgment. This consent judgment provided that the parties agreed to a
judgment of $15,000 in plaintiff’s favor along with a waiver of any remaining debt plaintiff owed
to defendant. The consent judgment indicates that both parties stipulated to its form and content.
Because the final judgment in this case was a consent judgment that was the product of the parties’
voluntary agreement, it did not constitute a “judgment” or “verdict” for purposes of case evaluation
sanctions under MCR 2.403(O)(2)(c). Acorn, 495 Mich at 354; Clohset, 302 Mich App at 565;
MCR 2.403(O)(2)(c).

                                                 -6-
        Nonetheless, defendant argues that the consent judgment was still a “verdict” for purposes
of MCR 2.403(O)(2)(c) despite the fact that—as defendant admits—the parties negotiated the
terms of the consent judgment. Defendant argues that the consent judgment resulted from “the
ruling,” citing the following language in the consent judgment:

               The parties further agree that this Final Judgment entered as a result of
       rulings by the court on motions filed by Baker College after case evaluation,
       specifically (but not limited to) Baker College’s motion for summary disposition
       and motions in limine concerning Plaintiff’s damages.

        However, to the extent the judgment references defendant’s prior motion for summary
disposition, defendant’s prior motion in limine concerning damages,4 or any other unspecified
prior motion, none of these motions could have actually resulted in the judgment that was entered
because the final judgment at issue expressly indicates multiple times that the terms of the
judgment were mutually agreed upon by the parties. Thus, the language of the consent judgment
makes it clear that the judgment and its terms were the product of the parties’ agreement rather
than a ruling by the trial court. Rory, 473 Mich at 464. A voluntary, mutual agreement is the very
definition of a consent judgment. See Acorn, 495 Mich at 354; Clohset, 302 Mich App at 565.
Where the judgment is the product of the parties’ mutual agreement, it logically follows that it is
not the result of a “ruling” by the trial court as required by MCR 2.403(O)(2)(c) to be considered
a “verdict.” See MCR 2.403(O)(2)(c); see also Acorn, 495 Mich at 354.

         As defendant argues, the consent judgment seems to indicate that the parties agreed to
preserve defendant’s right to seek case evaluation sanctions. However, regardless of defendant’s
ability to pursue case evaluation sanctions, MCR 2.403(O) defines when a party is actually entitled
to case evaluation sanctions. Acorn, 495 Mich at 348. Because the final judgment in this case was
a consent judgment rather than a judgment resulting from a ruling on a motion, the final consent
judgment did not constitute a “verdict” for purposes of MCR 2.403(O)(2)(c). Acorn, 495 Mich at
354. Defendant essentially suggests that the parties could mutually agree to create an additional
type of “verdict” that would allow it to obtain case evaluation sanctions, although defendant cites
no authority to support this position. However, “[i]n applying MCR 2.403(O)(2), this Court has
consistently rejected attempts to expand or read additional meaning into the rule that is not
expressly stated.” Jerico Const, Inc v Quadrants, Inc, 257 Mich App 22, 30; 666 NW2d 310
(2003). Parties cannot create by consent judgment an additional means of satisfying the definition
of “verdict” in MCR 2.403(O)(2). Jerico, 257 Mich App at 31 (holding that a stipulated order of
dismissal was not a “verdict” for purposes of MCR 2.403(O) because “the stipulated order of

4
  As previously stated, with respect to the motion for summary disposition, the trial court granted
summary disposition in defendant’s favor on four of the five counts alleged by plaintiff and denied
defendant’s motion for summary disposition with respect to the remaining count for breach of the
behavioral contract. That remaining count was subsequently settled by way of the consent
judgment. With respect to the motion in limine, the trial court ruled that plaintiff could not seek
damages for future lost wages on her remaining breach-of-contract claim and limited her potential
damages to the costs actually paid toward her education.

                                                -7-
dismissal was entered on the basis of plaintiff’s and [defendant’s] settlement agreement—not by
any of the three methods clearly and unambiguously set forth in MCR 2.403(O)(2)”).

        Because the consent judgment was not a “verdict” as that term is defined in MCR
2.403(O)(2), defendant was not entitled to recover case evaluation sanctions. MCR 2.403(O)(1).5
The trial court erred by granting case evaluation sanctions in defendant’s favor.6

        Having reached this conclusion, we need not address plaintiff’s remaining arguments
regarding the application of MCR 2.403(O), that the judgment was more favorable to plaintiff and
that the interest-of-justice exception in MCR 2.403(11) warranted denying case evaluation
sanctions. These issues are now moot. B P 7 v Bureau of State Lottery, 231 Mich App 356, 359;
586 NW2d 117 (1998) (“An issue is deemed moot when an event occurs that renders it impossible
for a reviewing court to grant relief.”).

     Finally, plaintiff argues that sanctions should be imposed against defendant pursuant to
MCR 1.109(E)(5)(b) and MCR 1.109(E)(6). These provisions provide:

             (5) Effect of Signature. The signature of a person filing a document,
       whether or not represented by an attorney, constitutes a certification by the signer
       that:

                                               * * *

               (b) to the best of his or her knowledge, information, and belief formed after
       reasonable inquiry, the document is well grounded in fact and is warranted by
       existing law or a good-faith argument for the extension, modification, or reversal
       of existing law; . . .

                                               * * *

              (6) Sanctions for Violation. If a document is signed in violation of this rule,
       the court, on the motion of a party or on its own initiative, shall impose upon the
       person who signed it, a represented party, or both, an appropriate sanction, which
       may include an order to pay to the other party or parties the amount of the
       reasonable expenses incurred because of the filing of the document, including
       reasonable attorney fees. The court may not assess punitive damages.

5
 Accordingly, we need not address defendant’s argument that the trial court abused its discretion
by not awarding the full amount requested in case evaluation sanctions.
6
  We additionally note that a party’s inability to obtain case evaluation sanctions when the party
agrees to settle a case by way of a consent judgment is in accord with the purpose of the case
evaluation sanctions rule, which is “to encourage settlement and deter protracted litigation by
placing the burden of litigation costs upon the party that required that the case proceed toward trial
by rejecting the mediator’s evaluation.” Peterson, 283 Mich App at 236 (quotation marks and
citation omitted).

                                                 -8-
        In this case, plaintiff’s sole basis for alleging that defendant should be sanctioned is that
defendant did not withdraw its motion for case evaluation sanctions after plaintiff informed
defendant of plaintiff’s contrary position on the matter. Having reviewed defendant’s arguments,
we do not conclude that defendant’s motion for case evaluation sanctions violated MCR
1.109(E)(5)(b). Defendant relied on language in the consent judgment that it believed brought the
judgment within the rule. Although we conclude that the relevant legal authority compels an
outcome contrary to defendant’s position, that fact standing alone does not indicate that defendant
violated MCR 1.109(E)(5)(b). “Not every error in legal analysis constitutes a frivolous position.”
Jerico, 257 Mich App at 36 (quotation marks and citation omitted). Plaintiff has not demonstrated
an entitlement to sanctions under MCR 1.109(E)(6).

        Reversed and remanded for further proceedings not inconsistent with this opinion. We do
not retain jurisdiction. No costs are awarded to any party. MCR 7.219.

                                                              /s/ Stephen L. Borrello
                                                              /s/ Deborah A. Servitto
                                                              /s/ Cynthia Diane Stephens

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