Court Opinion

ID: 4364942
Source: CourtListenerOpinion
Date Created: 2019-02-06 10:08:18.217528+00
Date Added: 2024-06-11T14:49:10.626414
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

MEADOWLARK BUILDERS LLC,                                           UNPUBLISHED
                                                                   February 5, 2019
              Plaintiff-Counterdefendant-
              Appellee/Cross-Appellant,

v                                                                  No. 341492
                                                                   Washtenaw Circuit Court
EMILY EVANS,                                                       LC No. 16-000355-CK

              Defendant-Counterplaintiff-Third-
              Party Plaintiff-Appellant/Cross-
              Appellee,
and

ARBOR INSULATION LLC and QUALITY
ELECTRIC SERVICES,

              Third-Party Defendants-Appellees,

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

PER CURIAM.

        Counterplaintiff, Emily Evans (Evans), appeals as of right the trial court’s granting of
summary disposition in favor of counterdefendant and third-party defendants on her claims
against them. Evans also challenges certain aspects of the trial court’s rulings in favor of
plaintiff, Meadowlark Builders, Inc., (Meadowlark) in its claims against her. Meadowlark cross-
appeals from the trial court’s ruling wherein it declined to award attorney fees to Meadowlark
under the Michigan Construction Lien Act. We affirm in Evans’ appeal, but remand the matter
to the trial court to articulate its reasons for denying Meadowlark’s motion for attorney fees
made under MCL 570.1118(2).

       Meadowlark, a licensed residential builder, initiated a breach of contract and foreclosure
of a construction lien action against Evans, asserting that Evans failed to pay it for home
improvement materials and services it provided on her Ann Arbor home pursuant to a November
25, 2015 contract between the two. Evans brought a counter-complaint against Meadowlark and
a third-party complaint against Arbor Insulation, LLC (Arbor), a subcontractor hired by
Meadowlark to perform insulation work, and Quality Electric Services (Quality), the
subcontractor that performed electrical work on her home, for unjust enrichment, breach of
implied covenant of good faith and fair dealing, civil conspiracy, negligence, and breach of
implied warranty. Evans contended that the work they were hired to perform (electrical and
insulation) was shoddy, that Meadowlark overcharged her, and that the work was not completed.

        Meadowlark, Arbor, and Quality all moved for summary disposition concerning Evans’
claims against them pursuant to MCR 2.116(C)(8). In an October 13, 2016 order, the trial court
dismissed Evans counter and third-party claims for breach of implied covenant of good faith and
fair dealing and breach of implied warranty. Meadowlark, Arbor, and Quality thereafter moved
for summary disposition on Meadowlark’s claims against Evans and on Evans’ remaining
counter- and third-party claims pursuant to MCR 2.116(C)(10). They argued that the work
authorization signed by Evans clearly stated that she was required to pay the contract balance
upon substantial completion of the project, that they substantially completed the project, and that
Evans admitted she did not pay the total amount due under the contract. The trial court granted
the motion in part and denied it in part, leaving only Evans’ counter- and third-party claim of
unjust enrichment for trial, along with Meadowlark’s claims against her for breach of contract
and foreclosure of a construction lien.

        On October 2, 2017, the date set for jury trial in the matter, Evans and her counsel failed
to appear for trial. Meadowlark thus proceeded to select a jury and placed its proofs on the
record. Meadowlark then moved for a default judgment in its favor on its claims against Evans
and for directed verdict as to Evans’ counterclaim for unjust enrichment, as did Arbor, and
Quality. The trial court granted both the motion for default judgment and the motions for
directed verdict. The trial court later granted Meadowlark’s motion for case evaluation sanctions
under MCR 2.403, but denied its motion for attorney fees under the Michigan Construction Lien
Act. The trial court also denied Evans’ motion to set aside the default judgment and for
reconsideration.

        As a preliminary matter, we first note that nowhere in Evans’ brief is there a citation to
any authority. Thus, her brief fails to conform to the requirements of MCR 7.212(C)(7).
Moreover, it has long been held that a party may not simply announce a position or assert an
error and “then leave it up to this Court to discover and rationalize the basis for his claims, or
unravel and elaborate for him his arguments, and then search for authority either to sustain or
reject his position.” Wilson v Taylor, 457 Mich. 232, 243; 577 NW2d 100 (1998). This Court
could thus properly hold that all of Evans’ arguments on appeal fail at the outset. In its
discretion, this Court will briefly address Evans’ claims on appeal.

       On appeal, Evans first contends that the trial court erred in granting summary disposition
in favor of Meadowlark, Arbor, and Quality on her counter- and third-party claims against them.
We disagree.

       Appellate review of the grant or denial of a summary disposition motion is de novo, with
the court viewing the evidence in the light most favorable to the party opposing the motion.
West v Gen Motors Corp, 469 Mich. 177, 183; 665 NW2d 468 (2003). A motion brought under

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MCR 2.116(C)(8) tests the legal sufficiency of the complaint solely on the basis of the pleadings
and a party may not support a motion under subrule (C)(8) with documentary evidence such as
affidavits, depositions, or admissions. Dalley v Dykema Gossett, 287 Mich. App. 296, 304–05;
788 NW2d 679 (2010). A court may grant summary disposition under MCR 2.116(C)(8) if
“[t]he opposing party has failed to state a claim on which relief can be granted.” Summary
disposition on the basis of subrule (C)(8) should be granted only when the claim “is so clearly
unenforceable as a matter of law that no factual development could possibly justify a right of
recovery.” Id. (citation omitted).

        A motion for summary disposition made under MCR 2.116(C)(10) tests the factual
sufficiency of the complaint. Bernardoni v City of Saginaw, 499 Mich. 470, 472; 886 NW2d 109
(2016). The Court considers all affidavits, pleadings, depositions, admissions, and other
substantively admissible evidence submitted by the parties in the light most favorable to the
party opposing the motion, and the adverse party is required to set forth specific facts at the time
of the motion showing a genuine issue for trial. Id. at 472-473. When the proffered evidence
fails to establish a genuine issue regarding any material fact, the moving party is entitled to
judgment as a matter of law. Id. at 473.

        Evans brought a claim for breach of an implied covenant of good faith and fair dealing
that she alleged was imposed on the contract between her and Meadowlark. Under the Uniform
Commercial Code (UCC), “[e]very contract or duty within this act imposes an obligation of good
faith in its performance and enforcement.” MCL 440.1304. However, the UCC applies to only
specifically enumerated transactions. The UCC applies “to a transaction to the extent that it is
governed by another article of this act.” MCL 440.1102. Defendant’s contract with defendant is
one for services and does not fall under the auspices of the UCC.

        It is also well-settled that, “[u]nlike some other jurisdictions, Michigan does not
recognize a cause of action for breach of the implied covenant of good faith and fair dealing.” In
re Leix Estate, 289 Mich. App. 574, 591; 797 NW2d 673 (2010) (quotation marks and citations
omitted). Thus, where the claim (like this one) is for an implied covenant of good faith and fair
dealing under the common law, rather than claim based upon the statutory directive in the UCC
that “a contract or duty within this act imposes an obligation of good faith in its performance and
enforcement,” Michigan does not recognize such a claim. Belle Isle Grill Corp v Detroit, 256
Mich. App. 463, 476; 666 NW2d 271 (2003). The trial court thus properly dismissed Evans’
counter- and third-party claim for breach of implied warranty of good faith and fair dealing.

        Evans also set forth a counter- and third-party claim for breach of implied warranty,
indicating that in every service contract, there is an implied duty to perform the services
“skillfully, carefully, diligently, and in a workmanlike manner.” Evans alleged that Meadowlark
and third-party defendants breached this implied warranty by employing an unlicensed
electrician to perform services on her home and employed inexperienced insulation installers
who did not perform the work properly and completely.

        In Nash v Sears Roebuck & Co, 383 Mich. 136, 142-143; 174 NW2d 818 (1970), our
Supreme Court recognized an implied duty, in every contract for work or services, to perform in
a diligent and reasonably skillful workmanlike manner, the breach of which may form the basis
for an action in tort. It did not, however, recognize an implied warranty in connection with a

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service contract. And, this Court, in Co-Jo, Inc v Strand, 226 Mich. App. 108, 114-115; 572
NW2d 251 (1997), superseded on other grounds as stated in Compuware Corp v Moody's
Investor Services, Inc, 499 F3d 520, 532 (CA 6, 2007), stated that the negligent performance of a
contract may constitute a tort as well as a breach of contract, but that the negligent performance
of a service contract does not establish breach of an implied warranty. Because Evans’ contract
with Meadowlark was one for services, she has no actionable claim for breach of implied
warranty for the alleged negligent performance of the service contract and the trial court properly
dismissed this claim.

        With respect to her claim for civil conspiracy, Evans alleged that “defendants, in concert,
conspired to inflate prices for material and labor in an effort to extract as much money as
possible from Evans” and that “this conspiracy resulted in the illegal, unlawful, or tortious
activity of breach of the implied covenant of good faith and fair dealing.” Because a breach of
the implied covenant of good faith and fair dealing is not an actionable tort in a service contract,
Evans’ claim of civil conspiracy fails.

         Finally, Evans asserted a claim for negligence alleging that Meadowlark owed a duty to
her to employ licensed professionals to manage and perform work on her home, and to act in
good faith in the negotiation of prices and terms as it related to the work on her home. Evans
asserted that Meadowlark breached those duties by hiring an unlicensed electrical worker and by
artificially inflating prices for material and labor.

        “To establish a prima facie case of negligence, a plaintiff must prove the following
elements: (1) the defendant owed the plaintiff a legal duty, (2) the defendant breached the legal
duty, (3) the plaintiff suffered damages, and (4) the defendant's breach was a proximate cause of
the plaintiff's damages.” Loweke v Ann Arbor Ceiling & Partition Co, LLC, 489 Mich. 157, 162;
809 NW2d 553 (2011). Summary disposition in favor of a defendant is proper “if the plaintiff
fails to establish a duty in tort.” Beaudrie v Henderson, 465 Mich. 124, 130; 631 NW2d 308
(2001). To determine whether a legal duty exists, courts examine a variety of factors, including
the relationship of the parties, the foreseeability of the harm, the degree of certainty of injury, the
closeness of connection between the conduct and injury, the moral blame attached to the
conduct, the policy of preventing future harm, and the burdens and consequences of imposing a
legal duty. In re Certified Question from the Fourteenth District Court of Appeals of Texas, 479
Mich. 498, 505; 740 NW2d 206 (2007); Valcaniant v Detroit Edison Co, 470 Mich. 82, 86; 679
NW2d 689 (2004).
        The Occupation Code, MCL 339.101, et seq. applies to and regulates skilled trades.
MCL 339.5101 et seq. MCL339.5737(1) prohibits a person from engaging in the business of
electrical contracting without an electrical contractor’s license. Contained in the Occupational
Code itself are criminal and administrative penalties for one who violates the licensure
requirement of the Occupational Code. See, e.g., MCL 339.601(4); MCL 339.602. However,
“[n]owhere in article 6 is there any intimation by the Legislature that private persons may bring
or intervene in civil actions to enforce any of the provisions of the Occupational Code.” Claire-
Ann Co v Christenson & Christenson, Inc, 223 Mich. App. 25, 30; 566 NW2d 4 (1997). Thus,
Evans’ claim of negligence based on the services provided by an unlicensed electrician has no
merit.

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         Evans claim of negligence premised upon Meadowlark’s alleged breach of a duty to “act
in good faith in the negotiation of prices and terms as it related to the work on her home,” by
“artificially inflating prices for material and labor” also has no merit. Determining whether an
action in tort can arise out of a contractual promise is often largely semantic and difficult to
discern. Loweke, 489 Mich. at 171. But whether a particular defendant owes any duty at all to a
particular plaintiff in tort is generally determined without regard to the obligations contained
within the contract. Id. (citations omitted, emphasis in original). The duties alleged to have been
breached by Meadowlark go to the writing of the contract itself. While our Courts recognize a
duty of good faith in bargaining or negotiating in certain realms (such as collective bargaining
agreements; see, e.g., Macomb Co v AFSCME Council 25, 494 Mich. 65, 79; 833 NW2d 225
(2013)), there is no such requirement imposed upon private parties entering into a contract. No
statute or case law suggests the existence of a duty of good faith in negotiation in contract prices
or terms between private parties. Because Evans failed to establish the existence of a duty on
Meadowlark’s part, her negligence claim was properly dismissed.

        Evans next asserts that after dismissing the bulk of her claims, the trial court abused its
discretion in declining to allow her to amend her counter- and third-party complaint to add
claims of fraudulent misrepresentation, silent fraud, violation of MCL 125.1447, and an
alternative claim of negligent misrepresentation. We disagree.

       The grant or denial of leave to amend pleadings is within the trial court's discretion. PT
Today, Inc v Commr of Office of Fin & Ins Services, 270 Mich. App. 110, 142; 715 NW2d 398
(2006). An abuse of discretion occurs only when the trial court's decision is outside the range of
reasonable and principled outcomes. Saffian v Simmons, 477 Mich. 8, 12; 727 NW2d 132 (2007).

        MCR 2.118(A)(1) provides, in relevant part, “a party may amend a pleading only by
leave of the court or by written consent of the adverse party. Leave shall be freely given when
justice so requires.” “Leave to amend may be denied for particularized reasons, such as undue
delay, bad faith, or dilatory motive on the movant's part, repeated failure to cure deficiencies by
amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of
the amendment, or futility of the amendment.” Amburgey v Sauder, 238 Mich. App. 228, 247;
605 NW2d 84 (1999). In addition, MCR 2.116(I)(5) states that if the trial court grants summary
disposition pursuant to MCR 2.116(C)(8), (9), or (10), the court shall give the parties an
opportunity to amend their pleadings “unless the evidence then before the court shows that
amendment would not be justified.” An amendment is considered futile if it is legally
insufficient on its face or if allegations in the proposed amendment merely restate those
allegations already made. Wormsbacher v Seaver Title Co, 284 Mich. App. 1, 8–9; 772 NW2d
827 (2009).

         Discovery had closed in this matter in February of 2017 and the parties had already
undergone case evaluation. Evans asserts that Meadowlark knew from the beginning of this case
that she was alleging that it took advantage of her and defrauded her. That being the case, there
is no stated good reason for defendant to have not sought to amend her complaint well prior to
the filing of her June 2017 motion to amend. Evans, then, unduly delayed bringing her proposed
amended counter- and third-party complaint.

                                                -5-
        In addition, the new claims sought to be added by Evans were supported by allegedly
new evidence and an affidavit of a previously undisclosed witness. “[A]a trial court may find
prejudice when the moving party seeks to add a new claim or a new theory of recovery on the
basis of the same set of facts, after discovery is closed, just before trial, and the opposing party
shows that he did not have reasonable notice, from any source, that the moving party would rely
on the new claim or theory at trial.” Weymers v Khera, 454 Mich. 639, 659–60; 563 NW2d 647
(1997). Discovery having closed months before and trial being set for October 2, 2017, and
Evans asserting that she knew from the time the case was filed that Meadowlark defrauded her,
Meadowlark, Arbor, and Quality would be prejudiced by the late amendment of her counter- and
third-party complaint. 1 And, based upon the evidence that was submitted to the trial court, it is
clear that Evans’ proposed amendments to her complaint would also be futile.

         Evans next claims that the trial court abused its discretion in denying her motion to
amend her witness list to add builder Joe O’Neal as an expert witness. Because Evans and her
counsel failed to appear for trial and thus called no witnesses, this issue is moot. 2 And, it is
undisputed that discovery had closed long ago. The request for the addition of an expert witness
at that juncture not only failed to comply with the trial court’s scheduling order, but adding the
witness would also prejudice Meadowlark, Arbor, and Quality. The affidavit of O’Neal was
attached to Evans June 2017 motion to amend her counter- and third-party complaint and was
apparently the first notice that Meadowlark, Arbor, and Quality had of the existence of O’Neal.
Discovery having closed and trial scheduled for a mere month after Evans’ motion to add O’Neal
as a witness, there would be insufficient time to conduct discovery regarding O’Neal. The
decision denying Evans’ request to amend her counter- and third-party complaint was within the
range of reasonable and principled outcomes. Saffian, 477 Mich. at 12.

       Evans next avers that the trial court erred in granting a default judgment in favor of
Meadowlark. We review a trial court's decision regarding whether to set aside a default for an
abuse of discretion. Alken-Ziegler, Inc v Waterbury Headers Corp, 461 Mich. 219, 223; 600
NW2d 638 (1999).

1
  Evans claims it was unjust of the trial court to allow Meadowlark to amend its complaint and
deny her the same opportunity. However, Evans filed no opposition to Meadowlark’s motion to
amend its complaint to add a claim of unjust enrichment. Moreover, Meadowlark’s claim was
based on Evans’ counsel’s argument at the summary disposition hearing in April of 2017, that
there was no contract between the parties because there was no meeting of the minds.
Meadowlark sought only to add an alternative claim of unjust enrichment based on counsel’s
argument and presented no new facts or allegations.
2
  Evans alleges that the trial court also abused its discretion in granting Meadowlark’s motion in
limine. Again, because Evans and her counsel failed to appear for trial, this issue is moot. In
addition, Evans did not file a written response to the motion in limine and, at the hearing on the
motion, Evans' counsel specifically stated that he did not oppose the motion. “A party cannot
stipulate a matter and then argue on appeal that the resultant action was error.” Holmes v
Holmes, 281 Mich. App. 575, 588; 760 NW2d 300 (2008), quoting Chapdelaine v Sochocki, 247
Mich. App. 167, 177; 635 NW2d 339 (2001).

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       MCR 2.603(D) provides, in pertinent part:

       (1) A motion to set aside a default or a default judgment, except when grounded
       on lack of jurisdiction over the defendant, shall be granted only if good cause is
       shown and an affidavit of facts showing a meritorious defense is filed.

The “good cause” requirement may be satisfied by demonstrating a procedural irregularity or
defect or a reasonable excuse for failing to comply with the requirements that led to the default
judgment. Brooks Williamson & Assoc, Inc v Mayflower Const Co, 308 Mich. App. 18, 25; 863
NW2d 333 (2014) (quotation marks and citations omitted).

        The default was entered in this case for defendant’s failure to appear for the scheduled
trial on October 2, 2017. In the court’s July 7, 2017 scheduling order, this matter had been set
for jury trial on October 2, 2017. Plaintiff appeared on that date for trial, but defendant did not,
and her counsel failed to appear as well.

        Evans contends that the default should not have been granted because her counsel had
withdrawn, that her mother had gone to the court on the day of trial to inform the court that
Evans was too ill to attend the trial, and that she had been told there was no point in going to trial
anyway unless accompanied by her former attorney. It is true that on Thursday, September 28,
2017, Evans’ counsel filed an emergency motion to withdraw as counsel citing a breakdown in
the attorney-client relationship. The same day, Evans, acting in pro per, filed an emergency
motion to update the court records immediately to reflect that she was representing herself.
However, no hearing was scheduled or heard on these motions and no order was entered with
respect to the motions prior to the scheduled trial date of the following Monday, October 2,
2017. A trial court speaks through its written orders. In re Contempt of Henry, 282 Mich. App.
656, 678; 765 NW2d 44 (2009). No order having been entered to allow for the withdrawal of
Evans’ counsel and no motion or order to adjourn the trial date having been filed, Evans and her
counsel were required to appear at the October 2, 2017, trial.

         Even if, as Evans asserts, she was representing herself at the time of trial, her explanation
for her failure to appear−that she thought the trial would be rescheduled due to her absence−fails.
Parties representing themselves are held to the same standard of presentation as would be a
member of the bar. Baird v Baird, 368 Mich. 536, 539; 118 NW2d 427 (1962). Evans was thus
charged with knowing that the trial court issued no order adjourning trial and that her failure to
attend that trial did not require the trial court to reschedule the trial. Evan’s misapprehension of
what she thought the trial court might −do is not a reasonable excuse for failing to appear for trial
if she was, in fact, representing herself, and thus does not present a valid claim of “good cause”
for setting aside the default. Brooks Williamson, 308 Mich. App. at 25.

       “[A] court, in its discretion, may dismiss a case with prejudice or enter a default
judgment when a party and counsel fail to appear at a duly scheduled trial.” Zerillo v
Dyksterhouse, 191 Mich. App. 228, 230; 477 NW2d 117 (1991). Because Evans failed to

                                                 -7-
establish good cause for her failure to attend the trial, entry of a default against her was not an
abuse of the trial court’s discretion.3

       On cross-appeal, Meadowlark asserts that the trial court abused its discretion in declining
to award it the attorney fees it sought under the Michigan Construction Lien Act. The trial court
awarded Meadowlark part of its requested attorney fees for case evaluation sanctions under
MCR 2.403, awarding plaintiff $420.27 in costs and $26,758.00 in attorney fees, but denied its
motion for attorney fees under the Michigan Construction Lien Act. The Act provides for the
award of attorney fees as follows:

              In each action in which enforcement of a construction lien through
       foreclosure is sought, the court shall examine each claim and defense that is
       presented and determine the amount, if any, due to each lien claimant or to any
       mortgagee or holder of an encumbrance and their respective priorities. The court
       may allow reasonable attorneys' fees to a lien claimant who is the prevailing
       party. The court also may allow reasonable attorneys' fees to a prevailing
       defendant if the court determines the lien claimant's action to enforce a
       construction lien under this section was vexatious. [MCL 570.1118(2)]

A trial court is required to make findings of fact in determining whether to award attorney fees
under the Construction Lien Act. Sol Source, Inc v LPR Assoc Ltd Pship, 252 Mich. App. 368,
381; 652 NW2d 474 (2002).

        In declining to award Meadowlark attorney fees under the Construction Lien Act, the trial
court simply stated that it was exercising its discretion. Lacking any factual findings by the trial
court on this issue, we are unable to review the matter on appeal. Remand is therefore necessary
for the trial court to articulate its reasons for denying Meadowlark’s motion for attorney fees
under MCL 570.1118(2).

        We affirm in Evans’ appeal, but remand the matter to the trial court to articulate its
reasons for denying Meadowlark’s motion for attorney fees made under MCL 570.1118(2). We
do not retain jurisdiction.

                                                              /s/ Deborah A. Servitto
                                                              /s/ Cynthia Diane Stephens
                                                              /s/ Mark T. Boonstra

3
  Evans states that the construction lien Meadowlark filed against her home was invalid and
unenforceable but provides no argument whatsoever is support of this bare assertion. We will
not rationalize the basis of this “claim,” elaborate her argument for her, or search for authority in
her stead. Wilson, 457 Mich. at 243.

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