Court Opinion

ID: 2798843
Source: CourtListenerOpinion
Date Created: 2015-05-06 12:13:43.859362+00
Date Added: 2024-06-11T12:07:36.910194
License: Public Domain

STATE OF MICHIGAN

                           COURT OF APPEALS

CARSON FISCHER PLC,                                                 UNPUBLISHED
                                                                    May 5, 2015
               Plaintiff-Appellant/Cross-Appellee,

v                                                                   No. 319361
                                                                    Charlevoix Circuit Court
METTLER WALLOON LLC and LOUIS                                       LC No. 11-055723-CK
METTLER,

               Defendants-Appellees/Cross-
               Appellants.

Before: SAWYER, P.J., and MURPHY and MARKEY, JJ.

PER CURIAM.

        Plaintiff, Carson Fischer, PLC, first appeals as of right the trial court’s February 17,
2012, order granting partial summary disposition under MCR 2.116(C)(10) in favor of
defendants Louis P. Mettler and Mettler Walloon, LLC, and denying plaintiff’s motion for
summary disposition under MCR 2.116(C)(10). Second, plaintiff also appeals the trial court’s
April 4, 2012, denial of plaintiff’s motion for summary disposition under MCR 2.116(C)(9) and
MCR 2.116(C)(10). Lastly, plaintiff appeals the trial court’s August 30, 2013, denial of
plaintiff’s Motion in Limine. Defendants, Louis P. Mettler and Mettler Walloon, LLC, cross
appeal as of right the entry of judgment in this case. We reverse and remand.

        Louis Mettler is the sole member of Mettler Walloon, LLC. Mettler Walloon, LLC, was
formed for the sole purpose of holding real estate. Plaintiff performed legal services for
defendants in three separate matters: the Melrose Matter, the Hughes Matter, and a 2006 Tax
Appeal. Defendants partially paid plaintiff for its services in the Melrose Matter, and defendants
did not pay plaintiff at all for the Hughes Matter or 2006 Tax Appeal. As a result, plaintiff filed
suit against Mettler and Mettler Walloon, LLC, for breach of contract, account stated, and
quantum meruit, seeking to recover the amounts due from defendants for the Melrose Matter,
Hughes Matter, and 2006 Tax Appeal. In defendants’ responsive pleading, Mettler denied all
individual liability. Mettler Walloon, LLC, admitted that it was a party to the Melrose Matter,
but it denied liability.

        Plaintiff filed a motion for summary disposition under MCR 2.116(C)(10), asking the
trial court to enter an order holding defendants jointly and severally liable. Defendants
responded with a counter motion for partial summary disposition under MCR 2.116(C)(10),

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asking the court to deny plaintiff’s motion and dismiss plaintiff’s claims against Louis Mettler on
the Melrose Matter and Hughes Matter. The trial court denied plaintiff’s motion for summary
disposition and granted defendants’ motion for partial summary disposition, dismissing
plaintiff’s claims in the Melrose Matter and Hughes Matter against Mettler individually.

         After the close of discovery, plaintiff filed a motion for summary disposition under MCR
2.116(C)(9) and MCR 2.116(C)(10) to dismiss defendant’s unpled affirmative defense of
reasonableness. The trial court denied plaintiff’s motion and allowed defendants to amend their
responsive pleading to include the affirmative defense of reasonableness. Plaintiff subsequently
filed a motion in limine to preclude defendants from arguing the issue of reasonableness because
it is not an element in breach of contract suits and defendants had not provided an expert to
testify about the reasonableness. Plaintiff’s motion also sought to exclude testimony from David
White, the opposing party’s attorney in the Melrose Matter, and John Turner, Mettler’s personal
attorney, about how much White and Turner billed during the pendency of the Melrose Matter.
The trial court denied plaintiff’s motion, holding that plaintiff had the burden of proof to show
reasonableness of the attorney fees in its case-in-chief, an expert is not required to show
reasonableness of attorney fees, and White and Turner’s testimony is relevant.

        At the end of trial, the jury instructions stated that if the jury decided to find for plaintiff,
then they must determine the amount of damages to be awarded. To determine the amount of
damages, the jury was instructed to award the injured party damages naturally arising from the
breach and defined damages as the sum of money required to put the injured party in as good of
a position as it would have been if the contract had been fully performed. However, the verdict
form given to the jury did not ask the jury to find for either party or to determine the amount of
damages; instead, the form asked the jurors to determine the total reasonable amount of fees
plaintiff should have charged for its services and told the jurors the amounts defendants had
already paid would be subtracted later. Plaintiff objected to the proposed verdict form on the
grounds that it did not characterize the proper burden or law in this case. Plaintiff’s objection
was overruled.

        After deliberation, the jury returned a verdict form in which the jury had written the
amount of damages plaintiff was seeking as its answer to the question asking what the total
amount of fees was that plaintiff reasonably should have charged. Defendants subsequently sent
plaintiff a proposed order of judgment claiming that the jury verdict awarded plaintiff zero.
Plaintiff filed a motion for an order of judgment and argued that the jury had intended to award
plaintiff the total amount of damages claimed, despite the actual language of the verdict form.
Plaintiff submitted affidavits from the jury that confirmed that this was the jury’s intent.

        Ultimately, the trial court determined that it was clear, based on the circumstances
surrounding the verdict and affidavits from the jurors, that the jurors had made a mistake when
entering the amounts on the verdict form because they had failed to notice the small print that
said the amount defendants had already paid would be subtracted from whatever amount the
jurors decided to write on the form. Instead, the trial court held, the jury intended to award
plaintiff the full amount of damages requested. Therefore, the court entered a judgment in favor
of plaintiff, awarding the full amount of damages requested. This appeal and cross appeal
followed.

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         Plaintiff first argues that the trial court erred when it denied plaintiff’s motion for
summary disposition to declare the defendants jointly and severally liable in the Melrose Matter,
Hughes Matter, and 2006 Tax Appeal. And, plaintiff argues, the trial court further erred when it
granted defendants’ motion for partial summary disposition, dismissing Louis Mettler from the
Melrose Matter and Hughes Matter. We agree. On appeal, a trial court’s decision on a motion
for summary disposition is reviewed de novo. Johnson v Recca, 492 Mich. 169, 173; 821 NW2
520 (2012). Summary disposition of all or part of a claim or defense may be granted when
“there is no genuine issue as to any material fact, and the moving party is entitled to judgment or
partial judgment as a matter of law.” MCR 2.116(C)(10). A genuine issue of material fact exists
when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an
issue upon which reasonable minds could differ. Debano-Griffin v Lake Co, 493 Mich. 167, 175;
828 NW2d 634 (2013).

        The proper interpretation of a contract is a matter of law this Court reviews de novo.
Hamade v Sunoco, Inc, 271 Mich. App. 145, 165-166; 721 NW2d 233 (2006). Whether a
contract’s terms are ambiguous is also a question of law this Court reviews de novo. Id. at 166.
The primary goal in the interpretation of a contract is to honor the intent of the parties. Klapp v
United Ins Group Agency, Inc, 468 Mich. 459, 473; 663 NW2d 447 (2003). As a matter of law,
an unambiguous contractual provision is reflective of the parties’ intent. Quality Products and
Concepts Co v Nagel Precision, Inc, 469 Mich. 362, 375; 666 NW2d 251 (2003). Therefore,
“[w]hen a contract is unambiguous, it must be enforced according to its terms.” Hamade, 271
Mich. App. at 166. A contract is ambiguous when its provisions can potentially have conflicting
interpretations. Klapp, 468 Mich. at 467. An ambiguity can be either patent or latent. Shay v
Aldrich, 487 Mich. 648, 667; 790 NW2d 629 (2010). A patent ambiguity “appears on the face of
the document, arising from the language itself, so extrinsic evidence cannot be used to identify it.
City of Grosse Pointe Park v Mich Muni Liability & Prop Pool, 473 Mich. 188, 198; 702 NW2d
106 (2005). However, “[a] latent ambiguity . . . does not readily appear in the language of a
document, but instead rises from a collateral matter when the document’s terms are applied or
executed.” Shay, 487 Mich. at 668 (citation omitted). Extrinsic evidence is admissible to prove
the existence of a latent ambiguity because “the detection of the ambiguity requires the
consideration of factors outside the document itself.” Id. (citation omitted). To verify the latent
ambiguity, the extrinsic evidence must support the argument that under the circumstances of the
contract’s formation, the contract’s language is susceptible to more than one interpretation. Id.

        In this case, there was no ambiguity as to client identity in the 2006 Tax Appeal because
the retainer agreement was addressed to both defendants, and Mettler signed the agreement both
as a member of Mettler Walloon, LLC, and an individual. Further, defendants offered no
argument with respect to fee liability for the 2006 Tax Appeal. Therefore, there is no genuine
issue of material fact concerning whether defendants are jointly and severally liable for the 2006
Tax Appeal, and the trial court erred in denying plaintiff’s motion for summary disposition
regarding defendants’ liability for the 2006 Tax Appeal.

         In the Hughes Matter, the only evidence on the record that a contract for services existed
is a letter in which Louis Mettler, individually and as a representative of Mettler Walloon, LLC,
waived the right to claim plaintiff had a conflict of interest while representing defendants against
Hughes. Because there is no evidence concerning the actual agreement for services, reasonable
minds may differ as to whether the conflict of interest waiver proves defendants should be held

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jointly and severally liable for the Hughes Matter. Therefore, there is a material issue of fact
concerning defendants’ liability in the Hughes Matter, and the trial court erred in granting
summary disposition in favor of defendants regarding Mettler’s liability for the Hughes Matter.

        In the Melrose Matter, the terms of the retainer agreement are clear and unambiguous.
There is no patent ambiguity. It is apparent that the term “you,” as used in the agreement, is
referring to Louis Mettler, to whom the agreement letter is addressed. At no point does the
agreement mention Mettler Walloon, LLC, or imply that Louis Mettler was signing as a
representative of Mettler Walloon, LLC. And, after viewing the admissible and relevant
extrinsic evidence, it is also clear that the agreement does not contain a latent ambiguity.
Extrinsic evidence of letters, invoices, and events that occurred after the formation of the
agreement is not admissible to determine the parties’ intent at the time the agreement was
executed, and the trial court erred in considering this evidence. Therefore, there is no genuine
issue of material fact concerning whether defendants are jointly and severally liable for the
Melrose Matter, and the trial court erred in denying plaintiff’s motion for summary disposition
regarding defendants’ liability for the Melrose Matter.

        Plaintiff next argues that the trial court erred by denying its motion for summary
disposition that sought to bar defendants from asserting reasonableness as an affirmative defense.
We disagree. Plaintiff further argues that the trial court erred by denying plaintiff’s motion in
limine and instead holding that plaintiff was required to prove reasonableness as a prima facie
element of its case. We agree.

        As stated previously, a trial court’s decision on a motion for summary disposition is
reviewed de novo. Johnson, 492 Mich. at 173. Whether an issue is an affirmative defense is a
question of law that is reviewed de novo. Citizens Ins Co of America v Juno Lighting, Inc, 247
Mich. App. 236, 241; 635 NW2d 379 (2001). The question of which party bears the burden of
proof is a question of law that is also reviewed de novo. Kelly v Builders Square, Inc, 465 Mich.
29, 34; 632 NW2d 912 (2001).

        Defendant’s argument that courts should always consider MRPC 1.5(a) when interpreting
the language of a fee agreement is without merit. MRPC 1.5(a) cannot give rise to a cause of
action for enforcement of a rule or for damages caused by failure to comply with an obligation or
prohibition imposed by a rule. MRPC 1.0(a). The only way MRPC 1.5(a) or “reasonableness”
can be introduced in the part of the case pertaining to the Melrose Matter and 2006 Tax Appeal is
if defendants asserted it as an affirmative defense. Evans v Luptak, PLC, 251 Mich. App. 187,
193-195; 650 NW2d 364 (2002). An affirmative defense is a defense that does not challenge the
factual merits of a plaintiff’s prima facie case but which otherwise denies relief. Harris v
Vernier, 242 Mich. App. 306, 314; 617 NW2d 764 (2000). “Reasonableness” or MRPC 1.5(a) is
not a challenge to any of the factual merits of plaintiff’s breach of contract case because there
have been no disputes concerning whether the services were preformed or whether the invoices
were paid. Instead, a defense of “reasonableness” or MRPC 1.5(a) is an attempt to avoid the
legal effect of the contract on other grounds. Therefore, “reasonableness” and MRPC 1.5(a) are
affirmative defenses.

        An affirmative defense must be asserted in a responsive pleading, either as originally
filed or as amended. MCR 2.111(F)(3). A defense not asserted in a responsive pleading is

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waived. MCR 2.111(F). In defendants’ original responsive pleading, no mention to MRPC
1.5(a) or “reasonableness” was made in the section pertaining to affirmative defenses.
Accordingly, these defenses were waived unless the pleading was amended with leave from the
court. In this case, leave to amend was properly given by the trial court. The trial court did not
err in denying plaintiff’s request for summary disposition preventing defendants from injecting
the affirmative defense of “reasonableness” on the grounds that defendants waived the defense
when they failed to plead it. There was no prejudice to plaintiff by allowing this defense because
plaintiff was on notice that defendants did not think the invoice amounts were “fair.”

       However, a party asserting an affirmative defense has the burden of presenting evidence
to support it. Attorney Gen ex rel Dep’t of Environmental Quality v Bulk Petroleum Corp, 276
Mich. App. 654, 664; 741 NW2d 847 (2009). So while the trial court did not err in allowing
defendants to assert “reasonableness” as an affirmative defense, it was an error to shift the
burden of proof for the defense onto plaintiff.

        Finally, plaintiff argues that the trial court abused its discretion when it admitted David
White’s testimony and invoices and determined that defendants were not required to provide
expert testimony regarding the reasonableness of plaintiff’s fees. We disagree in part. The trial
court’s decision whether to admit or exclude evidence is reviewed for an abuse of discretion.
Elezovic v Ford Motor Co, 472 Mich. 408, 419; 697 NW2d 851 (2005). Generally, an appellate
court should defer to the trial court’s judgment, and if the trial court’s decision results in an
outcome within the range of principled outcomes, it has not abused its discretion. Maldonado v
Ford Motor Co, 476 Mich. 372, 388; 719 NW2d 809 (2006), cert den 549 U.S. 1206; 127 S. Ct.
1261; 167 L. Ed. 2d 76 (2007).

        In this case, defendants have raised the defense of reasonableness under MRPC 1.5(a).
MRPC 1.5(a) specifically states the factors that may be used to determine whether an attorney’s
fee is reasonable. One of these factors is “the fee customarily charged in the locality for similar
legal services.” MRPC 1.5(a)(3). Because White was the attorney for the opposing party in the
Melrose Matter, it is substantially likely that his legal services were similar to the legal services
that plaintiff supplied for defendants. Therefore, the court did not abuse its discretion by
admitting the testimony and invoices of Daniel White.

     Regarding expert testimony requirements, in Lince v Monson, 363 Mich. 135, 140; 108
NW2d 845 (1961), the Court stated:

       In a case involving professional service the ordinary layman is not equipped by
       common knowledge and experience to judge the skill and competence of that
       service and determine whether it squares with the standard of such professional
       practice in the community. For that, the aid of expert testimony from those
       learned in the profession involved is required.

However, in Zeeland Farm Services, Inc v JBL Enterprises, Inc, 219 Mich. App. 190; 555 NW2d
733 (1996), this Court determined that an expert opinion to determine whether attorney fees are
reasonable under MRPC 1.5(a) is not required “in relatively simple matters.” Id. at 198.
Therefore, “expert testimony is not always required to prove the reasonableness of attorney
fees.” Id. at 195.

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        This case does not involve relatively simple matters. Plaintiff claims that the Melrose
Matter as well as the Hughes Matter and 2006 Tax Appeal involved highly technical, difficult
legal issues and a significant threshold, and defendants do not dispute these claims. Therefore,
defendants should be required to provide expert testimony in order to prove plaintiff’s fees were
unreasonable in this case. Concerning who would qualify as an expert in this case, MRE 702
states:

       If the court determines that scientific, technical, or other specialized knowledge
       will assist the trier of fact to understand the evidence or to determine a fact in
       issue, a witness qualified as an expert by knowledge, skill, experience, training, or
       education may testify thereto in the form of an opinion or otherwise if (1) the
       testimony is based on sufficient facts or data, (2) the testimony is the product of
       reliable principles and methods, and (3) the witness has applied the principles and
       methods reliably to the facts of the case.

Therefore, testimony from an attorney with experience in similar matters, such as David White,
would satisfy the expert testimony requirement in this case.

        On cross appeal, defendants argue that the trial court erred when it determined that the
jurors made a mistake under MRE 606(b)(3), considered juror affidavits in an attempt to
ascertain the jury’s intent, and did not enter a judgment in accordance with the verdict form. We
agree. This Court reviews de novo the interpretation and application of a court rule. Henry v
Dow Chem Co, 484 Mich. 483, 495; 772 NW2d 301 (2009).

        “Looking behind a verdict to determine if the finding is contrary to the jury’s intent is
directly contrary to the rule prohibiting examination of jury mental processes.” Hoffman v
Monroe Pub Sch, 96 Mich. App. 256, 260; 292 NW2d 542 (1980). There is one exception that
states that, “affidavits and testimony of jurors may be used to challenge the verdict where the
written verdict does not conform to the true verdict because of a clerical error.” Hoffman v
Spartan Stores, Inc, 197 Mich. App. 289, 294; 494 NW2d 811 (1992). However, “[w]here … it is
claimed that the jury intended a different outcome, but no mistransmission of the verdict or
clerical error occurred, the trial court should not permit alteration of the verdict. Id. at 295. We
conclude that the clerical-error exception does not apply in this case. Just because the jurors
intended a different outcome does not mean there was a clerical error. Instead of an incorrect
transcription or transmission of the verdict, the asserted error in this case involves the juror’s
misunderstanding of the verdict form. Therefore, the trial court erred when it considered juror
affidavits to look behind the verdict and determine the jury’s intent.

        To correct this error, defendants argue that this Court should enter a judgment in
accordance with the verdict form. We disagree. Although the trial court erred when it entered a
judgment in accordance with the jury’s intent rather than the verdict form, the verdict form used
in this case was erroneous, contradictory, and conflicting. Because the trial court ultimately
entered judgment in favor of plaintiff, plaintiff does not directly raise this instructional issue on
appeal. However, plaintiff objected to the verdict form at trial, preserving the issue for review.
Ordinarily, this Court does not address issues not raised on appeal. Tingley v Kortz, 262 Mich
App 583, 588; 688 NW2d 291 (2004). However, this Court possesses the discretion to review a
legal issue not raised by the parties. Id. Preserved claims of instructional error are reviewed de

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novo. Rose v State Farm Mut Auto Ins Co, 274 Mich. App. 291, 294; 732 NW2d 160 (2006). A
claim regarding the verdict form is reviewed as a jury instruction issue. People v Garcia, 448
Mich. 442, 483-484; 531 NW2d 683 (1995). This Court will not find error requiring reversal
unless “an unlawful, erroneous, contradictory or conflicting instruction is given to a jury on an
issue material to the case.” Scalabrino v Grand Trunk W R Co, 135 Mich. App. 758, 766; 356
NW2d 258 (1976).

        This is a breach of contract case. The jury instructions properly instructed the jurors to
determine whether the plaintiff had met its burden of proof for each element of a breach of
contract case and explained how to calculate damages. However, the verdict form used did not
ask for a determination on any of the elements and instead asked the jurors to calculate the
reasonable amount plaintiff should have charged for all of the services provided to defendants,
which is completely different than the instructions for calculating damages in a breach of
contract case. Therefore, the verdict form and jury instructions conflicted and contradicted each
other, and the verdict form itself was erroneous because it did not ask for a determination on any
of the material issues of the case. Accordingly, we find that the trial court committed an
instructional error requiring reversal notwithstanding the trial court’s subsequent error regarding
its entry of judgment in favor of plaintiff.

        In sum, the trial court’s February 17, 2012 order dismissing Louis P. Mettler from the
Melrose Matter and Hughes Matter is reversed and remanded in part. The trial court shall grant
plaintiff’s motion for summary disposition, finding Louis P. Mettler and Mettler Walloon, LLC,
jointly and severally liable for the Melrose Matter and 2006 Tax Appeal. However, the Hughes
Matter shall be submitted to the jury to determine liability. In addition, the issue of damages in
all three matters shall be submitted to the jury. On remand, defendants shall have the burden to
prove the “reasonableness” defense, and, in order to prove the “reasonableness” defense,
defendants shall be required to provide expert testimony, such as the testimony of an attorney
with experience in similar matters, regarding the reasonableness of plaintiff’s fees.

        Reversed and remanded for further proceedings consistent with this opinion. We do not
retain jurisdiction. No costs, neither party having prevailed in full.

                                                            /s/ David H. Sawyer
                                                            /s/ William B. Murphy
                                                            /s/ Jane E. Markey

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