Court Opinion

ID: 9950897
Source: CourtListenerOpinion
Date Created: 2024-03-15 05:06:34.965524+00
Date Added: 2024-06-11T14:37:24.877213
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

LUANNE KOZMA,                                                        UNPUBLISHED
                                                                     March 14, 2024
               Plaintiff-Appellant,

v                                                                    Nos. 363508; 364450
                                                                     Charlevoix Circuit Court
SCOTT LAW and DEBRA LAW,                                             LC No. 2022-080527-CZ

               Defendants-Appellees.

Before: PATEL, P.J., and RICK and FEENEY, JJ.

PER CURIAM.

        These consolidated appeals arise from a zoning dispute between the parties. The trial court
granted summary disposition in favor of defendants pursuant to MCR 2.116(C)(8) (failure to state
a claim upon which relief can be granted) and awarded them costs and attorney fees. In Docket
No. 363508, plaintiff appeals as of right the trial court’s order awarding costs and attorney fees to
defendants, arguing that the trial court committed procedural error when it calculated the award.1
In Docket No. 364450, plaintiff appeals by delayed leave granted the trial court’s orders granting
summary disposition and costs and attorney fees in favor of defendants and denying plaintiff’s
motion for reconsideration of that order, arguing that the trial court erred when it determined that
plaintiff’s claim was frivolous and that costs and attorney fees were warranted. On this record, the

1
  In Docket No. 363508, plaintiff also sought to appeal the trial court’s August 5, 2022 order
granting defendants’ motion for summary disposition and for costs and attorney fees, as well as a
September 22, 2022 order denying plaintiff’s motion for reconsideration of that order. However,
plaintiff’s October 21, 2022 claim of appeal was untimely regarding those two orders. This Court
dismissed plaintiff’s appeal regarding those orders without prejudice. Kozma v Law, unpublished
order of the Court of Appeals, entered November 29, 2022 (Docket No. 363508). Plaintiff then
filed a delayed application for leave to appeal the trial court’s summary disposition and
reconsideration orders in Docket No. 364450. This Court granted the delayed application and
consolidated that appeal with Docket No. 363508. Kozma v Law, unpublished order of the Court
of Appeals, entered June 20, 2023 (Docket No. 364450).

                                                -1-
trial court erred by determining that plaintiff’s claim was frivolous, and thus erred by awarding
attorney fees to defendants. Accordingly, in Docket No. 364450, we reverse the trial court’s ruling
that plaintiff’s claim was frivolous, as well as the portion of the August 5, 2022 order awarding
costs and attorney fees. We also reverse the October 4, 2022 order awarding costs and attorney
fees to defendants in Docket No. 363508.

                                 I. FACTUAL BACKGROUND

         Plaintiff and defendants each own properties near one another on the shoreline of Lake
Charlevoix in Hayes Township, Michigan.2 Defendants planned to build various recreational
facilities and several cabins on their property. As part of the construction, defendants proposed
dredging a channel from Lake Charlevoix leading to a larger, dredged boat basin. A boathouse
would have then sat upon the far end of the basin with slips to dock several boats. The boathouse
space above the boat slips would have been an approximately 4,500-square-foot “event space,”
and would have been connected to the property’s main residence by an outdoor walkway.

        This case ultimately arises from plaintiff’s attempt to prevent defendants from dredging
the lakeshore and building the boathouse. Notably, along with the zoning matter at issue here,
plaintiff was involved in a separate lawsuit against Hayes Township and several of its officials
regarding defendant’s boathouse plans and the proper interpretation of the Hayes Township zoning
ordinance.3 A November 29, 2021 affidavit executed by the Hayes Township zoning
administrator, and submitted to the trial court in the aforementioned lawsuit, sheds some light on
the matter. According to the affidavit, only alterations made by defendants to a strip of land 50
feet inland from the lake’s ordinary high-water mark, called the “shoreland protection strip,”
required zoning board approval. The zoning administrator attested that defendants did not need a
permit to dredge along the lakefront because dredging activities were regulated exclusively by the
Michigan Department of Environment, Great Lakes, and Energy (EGLE) and the United States
Army Corps of Engineers.

        In November 2019, the zoning authority approved a plan submitted by defendants
concerning the shoreland protection strip. In July 2020, defendants submitted a zoning application
for the boathouse. Within two days, the zoning administrator determined that defendants did not
need to go through any in-depth zoning approval process because the boathouse was to be
connected to the property’s principal residence. The administrator thus granted defendants a
permit to build the boathouse. It does not appear that defendants took any further action toward
beginning the dredging and boathouse project until 2022.

       Plaintiff treated the zoning administrator’s affidavit as an official determination regarding
the zoning authority’s interpretation of the zoning ordinance and filed an appeal with the Hayes
Township zoning board of appeals. Plaintiff argued that the zoning authority erred by treating

2
 This case was decided at the pleading stage before any discovery took place. The facts presented
are drawn from the allegations made in plaintiff’s original verified complaint and amended
complaint, as well as documents plaintiff’s verified complaint incorporated by reference.
3
    Kozma v Hayes Twp, Charlevoix Circuit Court (LC No. 21-0604-27CZ).

                                                -2-
defendants’ proposed channel and basin and the proposed boathouse as separate projects requiring
separate approval, rather than treating the entire thing as one project. According to plaintiff,
defendants’ proposal would violate a zoning ordinance prohibiting the construction of a structure
at or below ground level within 100 feet of the lake’s ordinary high-water mark. Plaintiff argued
that the channel and basin would be built within 100 feet of the ordinary high-water mark, and
moving the shoreline by dredging the channel and basin would necessarily extend the ordinary
high-water mark further inland. Therefore, the boathouse would have sat within 100 feet of the
ordinary high-water mark. Plaintiff asked the zoning board of appeals to find that channels, basins,
and boathouses were structures prohibited by the zoning ordinance and that defendants’ proposal,
in particular, was prohibited by the zoning ordinance.

        In early 2022, defendants applied for a permit from EGLE and the Army Corps of
Engineers to dredge their proposed channel and basin. Sometime in late May 2022, plaintiff
learned from the Army Corps of Engineers that defendants’ permit was given preliminary
approval. On May 25, 2022, plaintiff saw excavating equipment and dump trucks parked at
defendants’ property. On May 27, 2022, plaintiff saw more excavating equipment arrive on
defendants’ property. Later that day, plaintiff’s counsel sent an e-mail to defendants’ counsel
asking for assurance that defendants were not beginning work on the project. Plaintiff’s counsel
warned that plaintiff would file for a temporary restraining order and a preliminary injunction if
she did not get an assurance. Less than an hour later, defendants’ counsel responded to the e-mail,
stating that no excavation or construction work on the dredging and boathouse project were
imminent. Despite the prompt response, plaintiff filed a verified complaint and motion for a
temporary restraining order and a show-cause hearing on plaintiff’s request for a preliminary
injunction. Plaintiff sought to enjoin defendants from clearing any vegetation or excavating any
land relating to the dredging and boathouse project until the zoning board of appeals decided
plaintiff’s appeal. On May 31, 2022, plaintiff withdrew her request for a temporary restraining
order and a show-cause hearing, explaining that the temporary restraining order was unnecessary
on the basis of the assurance from defendants’ counsel that no construction was imminent.

        On June 2, 2022, defendants’ counsel sent an e-mail to plaintiff’s counsel stating that
defendants viewed plaintiff’s claim as meritless. The e-mail further stated that if plaintiff
voluntarily dismissed the case, defendants would provide plaintiff with “notice when the
application for the final necessary permit is submitted.” Plaintiff’s counsel responded to the e-
mail asking for further clarification that defendants were agreeing to delay work on the dredging
and boathouse project until after plaintiff’s appeal to the zoning board of appeals was decided. On
June 3, 2022, plaintiff filed a motion to reinstate her request for a temporary restraining order and
request for a show-cause hearing on a preliminary injunction on the basis of the lack of assurance
that defendants were not beginning work on the dredging and boathouse project. On June 6, 2022,
plaintiff filed a second motion to withdraw her request for a temporary restraining order because
the parties agreed that defendants would not begin construction on the dredging and boathouse
project until after applying for another permit, which would give plaintiff an opportunity to be
heard by the zoning authority. On June 13, 2022, plaintiff filed an amended complaint that
withdrew her request for a temporary restraining order and moved for a preliminary injunction
prohibiting defendants from beginning work on the dredging and boathouse project. Plaintiff
alleged that defendants’ assurances were no longer credible because defendants flew a helicopter
at a low altitude above plaintiff’s property, which violated a 2019 agreement under which
defendants would only fly their helicopters over their own property.

                                                -3-
        On July 5, 2022, defendants filed an answer to plaintiff’s amended complaint, as well as a
motion for summary disposition and for costs and attorney fees. Defendants argued that summary
disposition under MCR 2.116(C)(8) was proper because there was no legal cause of action plaintiff
could pursue related to any construction on defendants’ property. They further contended that an
award of costs and attorney fees was warranted because plaintiff filed a lawsuit that failed to state
a valid claim. In response, plaintiff argued that she had a viable cause of action because, under
MCL 125.3604(3), work on defendants’ dredging and boathouse project was required to be stayed
pending the outcome of plaintiff’s appeal with the zoning board of appeals.

        On August 5, 2022, the trial court held a hearing on defendants’ motion for summary
disposition and for costs and attorney fees. The court ultimately granted defendants’ motion for
summary disposition and for costs and attorney fees on the record. That same day, the court
entered an order granting summary disposition in favor of defendants and awarding costs and
attorney fees in an amount to be determined later. The order gave defendants seven days to submit
an affidavit to establish costs and attorney fees. On August 15, 2022, the zoning board of appeals
voted four-to-one to dismiss plaintiff’s appeal to the board.4

        On August 16, 2022, defendants filed a motion requesting $40 in costs and $10,500 in
attorney fees. In support of the calculation of attorney fees, one of defendants’ attorneys submitted
an affidavit and invoice requesting $4,500 in attorney fees, and another of defendants’ attorneys
submitted an affidavit and invoice requesting $6,000 in attorney fees.

         On August 24, 2022, plaintiff filed a response to defendants’ motion for costs and attorney
fees. Plaintiff argued that the trial court should not assess costs and attorney fees because
defendants did not comply with the trial court’s August 5, 2022 order requiring them to submit
proofs within seven days. On August 24, 2022, plaintiff also filed a motion for reconsideration of
the trial court’s order granting defendants’ request for costs and attorney fees. Plaintiff argued that
the trial court had been misled by defendants. Plaintiff pointed out that at the August 5, 2022
hearing on defendants’ motion for summary disposition, defendants told the court that they would
not agree to any stay in construction because they were trying to complete a construction project
by Christmas that would allow them to host a large family event. However, at the August 15, 2022
zoning board of appeals hearing, defendants represented that they had no plans to begin work on
a boathouse.

       On September 20, 2022, the trial court held a hearing on defendants’ request for costs and
attorney fees. Although the trial court did not grant a full hearing on plaintiff’s motion for
reconsideration, the trial court discussed its forthcoming opinion and order denying plaintiff’s

4
  The decision of the board of zoning appeals was not made part of the trial court record. However,
the minutes from the August 15, 2022 meeting in which the board of zoning appeals made the
decision is a public record. Additionally, it bears noting that after plaintiff’s appeal was dismissed,
the zoning board of appeals held another hearing on a petition from plaintiff and two other
residents, asking the board to determine whether the Hayes Township zoning ordinance allows for
the construction of channels and basins on the Lake Charlevoix shoreline. The board of zoning
appeals voted four-to-one to interpret the zoning ordinance as prohibiting excavation of the Lake
Charlevoix shoreline to install a channel or boat basin.

                                                 -4-
motion for reconsideration. The trial court stated that the automatic-stay statute was inapplicable
to the facts of this case, so plaintiff had not pleaded any legal basis under which the trial court
could have granted plaintiff equitable relief. The trial court stated that anything that happened
during zoning board of appeals proceedings was irrelevant because the trial court was required to
decide the motions on the basis of the facts that were before the court when the motions were
decided. Regarding plaintiff’s request that the court deny defendants’ motion for costs and
attorney fees on the basis of defendants’ untimely filing, defendants stated that their proposed
filing was completed within seven days, but defendants’ counsel chose to send it to plaintiff to
seek any response plaintiff had to the motion before filing it with the trial court. Plaintiff argued
that defendants should not be awarded any costs or attorney fees because defendants’ counsel did
not move to extend the deadline for filing documents relating to the amount sought and did not
contact plaintiff’s counsel until after the deadline for filing a bill of costs had passed. The trial
court found that defendants’ neglect in filing the motion late was excusable, and turned to the
calculation of attorney fees. The trial court ultimately concluded that it was reasonable to assess
attorney fees for one attorney only and awarded attorney fees for 20 billable hours at $300 an hour,
the higher amount billed between defendants’ two attorneys, and $40 for motion-filing fees.

        On September 21, 2022, the trial court entered an opinion and order denying plaintiff’s
motion for reconsideration. The trial court concluded that plaintiff’s claim had no basis in law or
fact. The trial court reasoned that defendants had no permit or pending application for a permit to
build a boathouse, and plaintiff had no reason to suspect defendants were beginning construction
on the dredging and boathouse project without seeking new permits. The trial court further
reasoned that the automatic-stay statute was inapplicable in this case because the zoning authority
had issued no permit and plaintiff, therefore, did not have a valid appeal to the zoning board of
appeals. On October 4, 2022, the trial court entered an order awarding defendants $6,000 in
attorney fees and $40 in costs.

                                        II. ANALYSIS

        In Docket No. 364450, plaintiff argues that the trial court erred when it determined that her
claim was frivolous. Relatedly, in Docket No. 363508, plaintiff argues that the trial court erred by
awarding attorney fees to defendants for duplicative and unnecessary work. We agree that
plaintiff’s claim was not frivolous, and that defendants were thus not entitled to attorney fees.

         “This Court reviews a trial court’s decision to award sanctions for submitting a frivolous
filing for an abuse of discretion.” Hairston v Josh LKU, ___ Mich App ___, ___; ___ NW2d ___
(2023) (Docket No. 363030); slip op at 10. Because a trial court’s finding regarding whether an
action was frivolous involves a question of fact, this Court reviews those findings for clear error.
Pontiac Country Club v Waterford Twp, 299 Mich App 427, 438-439; 830 NW2d 785 (2013).
Additionally, this Court reviews the reasonableness of an award of attorney fees for an abuse of
discretion. Teran v Rittley, 313 Mich App 197, 208; 882 NW2d 181 (2015). “We review a trial
court’s findings of fact underlying the award of attorney fees for clear error, and we review any
underlying issues of law de novo.” Id. “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 has been committed.” Higgins Lake Prop Owners Ass’n v Gerrish Twp,
255 Mich App 83, 92; 662 NW2d 387 (2003). “This Court reviews de novo whether the trial court

                                                -5-
properly interpreted and applied the statutes and court rules.” Hairston, ___ Mich App at ___; slip
op at 11.

        “Under Michigan law, a party that maintains a frivolous suit or asserts frivolous defenses
is subject to sanctions under applicable statutes and court rules.” BJ’s & Sons Constr Co Inc v
Van Sickle, 266 Mich App 400, 404; 700 NW2d 432 (2005). Under MCL 600.2591(1):

               Upon motion of any party, if a court finds that a civil action or defense to a
       civil action was frivolous, the court that conducts the civil action shall award to the
       prevailing party the costs and fees incurred by that party in connection with the
       civil action by assessing the costs and fees against the nonprevailing party and their
       attorney.

Additionally, under MCL 600.2591(3):

               (a) “Frivolous” means that at least 1 of the following conditions is met:

              (i) The party’s primary purpose in initiating the action or asserting the
       defense was to harass, embarrass, or injure the prevailing party.

               (ii) The party had no reasonable basis to believe that the facts underlying
       that party’s legal position were in fact true.

               (iii) The party’s legal position was devoid of arguable legal merit.

The trial court determined that plaintiff’s claim was frivolous only on the basis that the claim was
devoid of arguable legal merit under MCL 600.2591(3)(a)(iii). “The determination whether a
claim or defense is frivolous must be based on the circumstances at the time it was asserted.”
Jerico Constr Inc v Quadrants Inc, 257 Mich App 22, 36; 666 NW2d 310 (2003). “Not every
error in legal analysis constitutes a frivolous position.” Id. “The mere fact that [a] plaintiff did
not ultimately prevail does not render the [claim] frivolous.” Kitchen v Kitchen, 465 Mich 654,
662; 641 NW2d 245 (2002). “Instead, a claim is devoid of arguable legal merit if it is not
sufficiently grounded in law or fact, such as when it violates basic, longstanding, and unmistakably
evident precedent.” Cove Creek Condo Ass’n v Vistal Land & Home Dev, LLC, 330 Mich App
679, 711; 950 NW2d 502 (2019).

         A trial court’s determination of frivolousness involves consideration of both the applicable
law and the facts supporting a claim. Hairston, ___ Mich App at ___; slip op at 10-11. The trial
court did not offer much rationale for why it determined that plaintiff’s claim was frivolous, and
its full reasoning can only be discerned from piecing together several sources. When granting
defendants’ motions for summary disposition and costs and attorney fees during the August 5,
2022 hearing, the trial court made a conclusory statement that summary disposition was
appropriate because plaintiff could not state a valid claim for injunctive relief and a conclusory
finding that plaintiff’s claim was frivolous. At the September 20, 2022 hearing on defendants’

                                                -6-
award of costs and attorney fees, the trial court briefly summarized MCL 125.3604(3)5 and
concluded that the statute did not form a basis for the trial court to order injunctive relief. In its
September 21, 2022 opinion and order denying plaintiff’s motion for reconsideration, the trial
court essentially assumed that the automatic-stay provision of MCL 125.3604(3) only applies to a
specific zoning permit sought by a landowner. According to the court, in the absence of a pending
permit for the dredging and boathouse project or facts showing that defendants may begin the
project without applying for required permits, MCL 125.3604(3) was simply inapplicable to
plaintiff’s claim.

        On the basis of the trial court’s stated rationale, it appears that the trial court interpreted
MCL 125.3604(3) in isolation. Statutes must be interpreted as a whole, within the context of the
statutory scheme. Nyman v Thomson Reuters Holdings, Inc, 329 Mich App 539, 544; 942 NW2d
696 (2019). Neither this Court nor our Supreme Court has ever interpreted the automatic-stay
provision of MCL 125.3604(3). In lieu of any official interpretation by Michigan’s appellate
courts, plaintiff offered a reasonable interpretation of the Michigan Zoning Enabling Act,
MCL 125.3101 et seq., arguing that the automatic-stay provision of MCL 125.3604(3) applies to
construction on a specific project when there is an appeal of a determination that no permit is
required for the project. The two central questions are 1) whether an appeal of a determination
made by a zoning authority that no permit is necessary for a project triggers the automatic-stay
provision and 2) whether the automatic-stay provision prohibits work on a project until the zoning
board of appeals has decided the appeal. Without deciding the proper interpretation of the statute,
it can be concluded that plaintiff’s claim had arguable legal merit because it was sufficiently
grounded in law and fact.

        The Michigan Zoning Enabling Act supports plaintiff’s argument that an appeal of a
determination that no permit is necessary for a project triggers the automatic-stay provision. Under
MCL 125.3603(1), a zoning board of appeals “shall hear and decide appeals from and review any
administrative order, requirement, decision, or determination made by an administrative official
or body charged with enforcement of a zoning ordinance adopted under this act.” Citizens are
permitted to appeal decisions made by a zoning authority, so long as the person is aggrieved by
the decision. MCL 125.3604(1). The statute also indicates that an aggrieved person may challenge
an interpretation of a zoning ordinance that involves a specific proposed project. Under
MCL 125.3604(5):

               If the zoning board of appeals receives a written request seeking an
       interpretation of the zoning ordinance or an appeal of an administrative decision,
       the zoning board of appeals shall conduct a public hearing on the request. Notice
       shall be given as required under section 103. However, if the request does not

5
  MCL 125.3604(3) states: “An appeal to a zoning board of appeals stays all proceedings in
furtherance of the action appealed. However, if the body or officer from whom the appeal is taken
certifies to the zoning board of appeals after the notice of appeal is filed that, by reason of facts
stated in the certificate, a stay would in the opinion of the body or officer cause imminent peril to
life or property, proceedings may be stayed only by the restraining order issued by the zoning
board of appeals or a circuit court.”

                                                 -7-
       involve a specific parcel of property, notice need only be published as provided in
       section 103(1) and given to the person making the request as provided in section
       103(3). [Emphasis added.]

Under MCL 125.3103(1), a zoning board of appeals is only required to publish notice of a meeting
“in a newspaper of general circulation in the local unit of government not less than 15 days before
the date of the hearing.” MCL 125.3103(2) provides, in pertinent part, that “[n]otice required
under this act shall be given as provided under subsection (3) to the owners of property that is the
subject of the request.” MCL 125.3103(2) and (3) require that notice must be either personally
delivered to the owner of the property that is the subject of the hearing or delivered by United
States mail or a courier service no less than 15 days before the hearing. Regarding the hearing
itself, MCL 125.3604(6) provides that “a party may appear personally or by agent or attorney.”
Thus, the statute allows a person aggrieved by an interpretation of a zoning ordinance to challenge
the interpretation as it applies to a specific project, and the statute gives due-process rights to the
owner of the property that is the subject of the appeal. That framework reasonably supports the
conclusion that an appeal of an interpretation of a zoning ordinance as it relates to a specific
property is an “appeal to the zoning board of appeals” for purposes of MCL 125.3604(3), and the
automatic-stay provision applies.

        MCL 125.3604(3) provides, in pertinent part, that “[a]n appeal to the zoning board of
appeals stays all proceedings in furtherance of the action appealed.” Whether construction is
automatically stayed under the statute concerns the interpretation of what constitutes “proceedings
in furtherance of the action appealed” under MCL 125.3604(3). The Michigan Zoning Enabling
Act does not define the terms “proceedings,” “furtherance,” or “action.” See MCL 125.3102.
Plaintiff argues that the terms should all be interpreted broadly to include a property owner’s
commencement of work on the project that is the subject of the appeal. According to plaintiff,
construction is a proceeding and that proceeding is in furtherance of the action appealed. That
interpretation is within the range of several reasonable interpretations of the statute. Notably, the
statute refers to an “action,” rather than a permit. This suggests that the term “action appealed”
should be read broadly to mean that the action is the construction project, not the permitting
process, and construction is stayed. On the other hand, consultation of a dictionary indicates that
“proceeding” more typically connotes the conducting of official business, 6 which could indicate
that the Legislature intended to confine a stay to the processing of a permit by a zoning authority.
There is also a more middle-of-the-road interpretation under which a property owner would be
stayed from engaging in any official proceedings relating to the action appealed, which, in this
case, would include applying for a dredging permit from EGLE and the Army Corps of Engineers.

        Resolution of the underlying issue may prove to be a close question. However, plaintiff’s
interpretation is at least arguably correct. If the automatic-stay provision did not apply to
construction, the Legislature would have essentially created a right without a remedy. If a zoning
administrator erroneously concluded that no permit was needed for a project, there would be no
mechanism for stopping construction until after the zoning board of appeals decided the appeal.

6
 See Merriam-Webster’s Collegiate Dictionary (13th ed) (defining “proceeding” as “legal action;”
“an official record of things said or done”).

                                                 -8-
After an aggrieved person filed an appeal, a zoning board of appeals would have to schedule a
hearing and provide at least 15 days’ notice of the hearing before it could decide the appeal,
potentially allowing time for irreparable harm to occur. Accordingly, enabling a zoning
administrator to unilaterally allow construction on a project before an appeal was decided would
subvert the purpose of the appeals process. Therefore, there is legal merit to plaintiff’s contention
that the automatic-stay provision applies to construction while an appeal regarding a determination
relating to the project is pending. The facts of this case demonstrate how excluding construction
from the statute’s application would be problematic and contrary to the purpose of allowing an
appeal. In this case, had defendants actually begun dredging, there would have been no means to
prevent the irreparable destruction of a portion of the lakeshore. Importantly, the zoning board of
appeals ultimately concluded that plaintiff’s interpretation of the Hayes Township zoning
ordinance was correct and that the ordinance prohibited dredging and the construction of
boathouses on the shoreline. Under the circumstances, plaintiff’s claim was sufficiently grounded
in law.

        Plaintiff’s claim was also sufficiently grounded in fact to state a claim upon which relief
could have been granted. Plaintiff alleged facts in her amended complaint, supported by evidence
offered in her initial verified complaint, to plausibly support the contention that defendants planned
to begin dredging the shoreline before the zoning board of appeals decided plaintiff’s appeal. On
December 3, 2021, plaintiff learned via an affidavit sworn by the Hayes Township zoning
administrator that the administrator determined that no zoning approval was necessary for
defendants to begin dredging the channel and basin. Plaintiff considered the affidavit to be a
determination made by the zoning administrator and appealed that determination to the zoning
board of appeals on December 20, 2021. Plaintiff’s main contention was that the dredging and
boathouse project had to be considered as one project, rather than the three separate projects the
zoning administrator had considered in the proposal, and that the zoning ordinance prohibited
defendants’ proposed project in its entirety. In early 2022, while plaintiff’s appeal was pending,
defendants applied for a permit with EGLE and the Army Corps of Engineers to dredge their
proposed channel and basin. Plaintiff attached to her verified complaint a March 28, 2022 e-mail
written by the zoning administrator reaffirming his determination that the zoning authority could
neither grant or deny permission to dredge along the shoreline. In the days before plaintiff filed
her original complaint, plaintiff learned that defendants had preliminary approval from EGLE and
the Army Corps of Engineers to dredge the channel and basin and plaintiff observed excavating
equipment and dump trucks on defendants’ property. On May 27, 2022, plaintiff filed her verified
complaint seeking a temporary restraining order and preliminary injunction, and plaintiff’s counsel
e-mailed defendants’ counsel the same day asking for an assurance that defendants were not
beginning to dredge on the shoreline. Later that day, one of defendants’ attorneys gave plaintiff
an unequivocal assurance that “no construction or excavation work is imminent.” However, the
attorney’s e-mail also stated that he would not be able to talk to defendants until the following
week. On May 31, 2022, plaintiff filed a motion to withdraw her requests for a temporary
restraining order and preliminary injunction, trusting the assurance offered by defendants’ counsel.

         After defendants’ attorney consulted with defendants, defendants seemed to pull back from
an explicit assurance that they would not begin dredging the channel and basin until after plaintiff’s
appeal to the zoning board of appeals was decided. In a June 2, 2022 e-mail, defendants proposed
that, in exchange for plaintiff dismissing her claim, “we will commit to giving you notice when
the application for the final necessary permit is submitted.” Plaintiff’s counsel replied to the e-

                                                 -9-
mail, stating that plaintiff did not know what defendants meant by “final necessary permit” and
asking for a more explicit promise from defendants that they would not begin dredging until after
the zoning board of appeals decided plaintiff’s appeal. On June 3, 2022, plaintiff filed a motion
to reinstate her request for a temporary restraining order and preliminary injunction. Later that
day, defendants told plaintiff that they were not beginning work on the dredging and boathouse
project until after applying for additional permits, and plaintiff filed a second motion to withdraw
her request for a temporary restraining order and preliminary injunction on June 6, 2022.

        However, the agreement between plaintiff and defendants did not last long. Later in the
day on June 6, 2022, a helicopter leaving defendants’ property flew at a low altitude over plaintiff’s
property, which plaintiff interpreted as a provocation. Plaintiff viewed the intrusion of the
helicopter as an intentional violation of a 2019 agreement under which defendants agreed that they
would only fly helicopters over their own property. Plaintiff no longer found defendants’
assurances that they would not begin dredging on their property before applying for new permits
credible. On June 13, 2022, plaintiff filed an amended complaint that sought a preliminary
injunction, but not a temporary restraining order, prohibiting defendants from beginning work on
the dredging and boathouse project until plaintiff’s appeal with the zoning board of appeals was
decided. Plaintiff’s amended complaint recounted the history of the litigation regarding the
various filings and communication between the parties. Plaintiff also alleged that, according to
documentation plaintiff received from EGLE and the Army Corps of Engineers, defendants
planned to excavate nearly 15,000 cubic yards of material along the lakefront. It was from that
point when plaintiff filed her amended complaint that the trial court was required to assess whether
plaintiff’s claim was sufficiently grounded in fact. Jerico Constr, Inc, 257 Mich App at 36.

        The trial court abused its discretion when it awarded costs and attorney fees because it
committed legal and factual errors. The trial court decided defendants’ motion for summary
disposition, brought under MCR 2.116(C)(8), on the basis that plaintiff could not state a claim
upon which relief could be granted. When deciding a motion brought under MCR 2.116(C)(8), a
court must decide the motion on the basis of the pleadings alone, accepting as true all factual
allegations. El-Khalil v Oakwood Healthcare Inc, 504 Mich 152, 160; 934 NW2d 665 (2019). A
trial court may not assess credibility when deciding such a motion. Johnson v Detroit Edison Co,
288 Mich App 688, 696; 795 NW2d 161 (2010). When plaintiff filed her amended complaint, the
most pertinent of plaintiff’s allegations were that defendants were finalizing a dredging permit
with EGLE and the Army Corps of Engineers and moving excavating equipment onto their
property. These allegations were supported by evidence offered in plaintiff’s original verified
complaint. At that stage of the litigation, plaintiff’s claim was not so implausible that no factual
development could show that she was entitled to relief under the legal theory of her claim. In
deciding plaintiff’s motion for reconsideration, the trial court reasoned that plaintiff had no factual
basis to believe that defendants would begin work on the dredging and boathouse project without
obtaining “required permits from the applicable governmental authorities.” The trial court’s
reasoning was rooted in a factual error. When plaintiff filed her amended complaint, the zoning
administrator maintained the position that only EGLE and the Army Corps of Engineers could
permit dredging on the lakeshore, and defendants were finalizing a permit to dredge with those
agencies. When plaintiff filed her amended complaint, defendants had only offered to notify
plaintiff when they submitted applications for new permits. At least as it pertained to dredging,
defendants did not have to apply for any additional permit to begin work. The trial court’s

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assumption that defendants could not begin dredging until defendants applied for new permits and
that plaintiff would have a chance to challenge any permit applications is clearly erroneous.

         Further, the trial court effectively decided that plaintiff’s claim lacked factual merit on the
basis of an impermissible credibility determination. The trial court never reached the merits
regarding whether a preliminary injunction was warranted in this case, which would have called
upon the trial court to make factual findings. Nevertheless, the trial court considered as true the
in-court statements of defendants’ counsel, made long after plaintiff filed her amended complaint,
that defendants were not planning to begin dredging along the shoreline or work on the proposed
boathouse. When plaintiff filed her amended complaint, the finalization of defendants’ dredging
permit from EGLE and the Army Corps of Engineers was the only legal impediment left before
defendants could begin dredging, aside from plaintiff’s claim. To avoid being sanctioned by the
court, the trial court essentially required plaintiff to accept defendants’ ambiguous statements
regarding permitting for their construction plans as proof that they would not begin dredging. Had
the trial court reached the merits of plaintiff’s claim for a preliminary injunction, it may have been
justified in making a factual finding that defendants were not planning to imminently dredge along
the shoreline, which in turn would have made a preliminary injunction inappropriate. However,
at the time plaintiff filed her amended complaint, plaintiff presented a plausible claim on the basis
of the allegations that defendants were finalizing a dredging permit, moving excavating equipment
onto their property, and equivocating regarding their construction plans.

        Under the circumstances, plaintiff’s claim was not frivolous because it was sufficiently
grounded in law and fact. The trial court clearly erred when it determined that plaintiff’s claim
had no arguable legal merit and that there was no factual basis for plaintiff’s claim. Therefore, the
trial court abused its discretion when it found that plaintiff’s claim was frivolous and awarded
defendants costs and attorney fees.7

        Reversed and remanded for further proceedings consistent with this opinion. We do not
retain jurisdiction.

                                                                /s/ Sima G. Patel
                                                                /s/ Michelle M. Rick
                                                                /s/ Kathleen A. Feeney

7
  Plaintiff also argues that the trial court abused its discretion by accepting defendants’ untimely
filing regarding the award of costs and attorney fees. Because we conclude that the trial court
erred by concluding that plaintiff’s claim was frivolous and by awarding attorney fees to
defendants, we need not address the merits of this issue.

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