Court Opinion

ID: 2803660
Source: CourtListenerOpinion
Date Created: 2015-05-27 15:13:48.574606+00
Date Added: 2024-06-11T11:27:39.783429
License: Public Domain

STATE OF MICHIGAN

                            COURT OF APPEALS

JAMES H. HELD and NICHOLE HELD,                                      UNPUBLISHED
                                                                     May 26, 2015
               Plaintiffs-Appellants,

v                                                                    No. 320072
                                                                     Oakland Circuit Court
GUSOLINE ALLEY, INC., d/b/a GUSOLINE                                 LC No. 2013-132791-NO
ALLEY,

               Defendant-Appellee.

Before: MURPHY, P.J., and STEPHENS and GADOLA, JJ.

PER CURIAM.

        Plaintiffs appeal as of right an order denying their motion for relief from judgment. The
trial court had earlier granted plaintiffs’ motion for voluntary dismissal without prejudice, MCR
2.504(A), with respect to plaintiffs’ premises liability action against defendant. But the dismissal
ruling had also provided that any future suit filed by plaintiffs against defendant would be
subject to a previous court decision striking plaintiffs’ witness and exhibit lists that were not
timely filed under the court’s scheduling order. We reverse and remand for further proceedings.

        Plaintiff James Held alleged that on January 26, 2013, he suffered an injury when he
slipped and fell on a thin sheet of ice when exiting defendant’s bar. Held and his wife Nichole
Held, as plaintiffs, filed their suit against defendant in the Oakland Circuit Court on March 13,
2013. Plaintiffs were represented by an attorney, and counsel e-filed the complaint. At the time
of this e-filing, counsel failed to register his e-mail address with the trial court as a “service
contact.”1 In an affidavit filed by plaintiffs’ counsel later in the suit, he averred:

1
  Pursuant to § 6(a) (“Service”) of Administrative Order No. 2007-3, 494 Mich lix (2013)
(extending AO 2007-3 through June 30, 2015, with respect to Oakland Circuit Court’s e-filing
pilot project):
              All parties shall register with the court and opposing parties one e-mail
       address with the functionality required for the pilot program, through Tyler
       Odyssey File and Serve. All service shall originate from this registered e-mail
       address.

                                                -1-
                  On March 13, 2013, Plaintiffs’ counsel e-filed this case with [the] Oakland
          County Circuit Court. This e-filing was accepted by . . . [the court]. Unbeknownst
          to Plaintiffs’ counsel, when the case was e-filed, Plaintiffs’ counsel’s e-filer did
          not click on the correct button, and Plaintiffs’ counsel was not “attached” to the
          case as an official “service contact.” No one from [the] Oakland County Circuit
          Court contacted me to advise me of this fact. I did not discover until December
          26, 2013[,] that I was not added as a service contact on this case.

        Defendant e-filed its answer to the complaint on April 8, 2013. Plaintiffs’ counsel
indicated in his affidavit that he was able to open and view documents e-filed by defendant in the
case because, as explained to plaintiffs’ counsel by court personnel, “[d]efendant had been
manually adding [counsel] as a service contact.”2

        On May 28, 2013, the trial court prepared, issued, and e-filed a scheduling order in which
it directed, in part, that the parties exchange and file witness and exhibit lists no later than
August 30, 2013.3 The scheduling order also provided that discovery was to be completed by
September 24, 2013, that dispositive motions were to be filed by October 18, 2013, that case
evaluation was to take place in October 2013, and that the case had a trial date of February 6,
2014. Plaintiffs’ attorney averred in his affidavit that he was not served with the scheduling
order at the time, given that he was not listed as a “service contact” with the court. He further
asserted that he was never served, by e-mail or otherwise, with the scheduling order. Plaintiffs’
counsel claimed that, in light of the fact that he did not receive the scheduling order, he was
unaware of the filing deadlines, including the one for the witness and exhibit lists.

        On August 30, 2013, in compliance with the scheduling order, defendant filed and served
its witness and exhibit lists; plaintiffs did not and were thus in violation of the scheduling order.
On September 20, 2013, defendant e-filed a motion to extend the dates previously set in the
scheduling order for discovery, case evaluation, and trial, noting that defense counsel was in the
process of transferring the case to a new attorney. Considering the affidavit executed by
plaintiffs’ counsel, and according to a proof of service, defendant’s motion was served on
plaintiffs’ counsel by e-mail. Defendant e-filed a notice of hearing with respect to its motion,
with the motion being scheduled for hearing on October 2, 2013, and the notice was served on
plaintiffs’ counsel by e-mail. Before that hearing, on September 27, 2013, a stipulation and
order for substitution of defense counsel was e-filed and entered (stipulation was between prior

As implemented under the authority of AO 2007-3, policy rules of the Oakland Circuit Court
warn litigants that judges issue opinions and orders electronically, that all “[a]ll filers must
register as a Service Contact through Odyssey File and Serve,” and that “[i]f you fail to register,
you will not receive copies of orders issued by the Court.” Oakland Circuit Court, Notice of
Mandatory E-Filing (emphasis in original).

2
    Plaintiffs’ attorney averred, “I received documents e-filed by defense counsel on this case[.]”
3
 There was no scheduling or pretrial conference that precipitated entry of the scheduling order,
nor was such a conference required. MCR 2.401(B)(2).

                                                  -2-
and new defense counsel). The stipulated order indicated that “[a]ll dates in the scheduling order
shall remain in effect.” There is no proof of service in the record regarding the stipulation and
order, and it is simply unclear whether plaintiffs’ counsel ever observed the stipulation and order.

        On October 2, 2013, a hearing was apparently held on defendant’s motion to extend the
dates for discovery, case evaluation, and trial.4 The trial court entered an order extending two
dates, changing the case evaluation date to November 29, 2013, and moving the discovery cut-
off date to November 29 to coincide with the case evaluation date; the trial court left the existing
trial date in place. According to the affidavit of plaintiffs’ attorney, and as conveyed to him by
court personnel, on October 16, 2013, counsel was officially added as a “service contact” on the
case for purposes of the court’s e-filing system, although counsel himself did not become aware
of this fact until December 26, 2013. On October 17, 2013, the court received for filing
plaintiffs’ witness list, but no exhibit list was forthcoming.5 Plaintiffs’ counsel averred in his
affidavit that he “did not know the witness list was tardy” and that he “simply did not know
about the witness deadline because he never saw the scheduling order.” (Emphasis in
original.)

        On November 13, 2013, defendant filed a motion for leave to file a dispositive motion, as
the deadline for dispositive motions set forth in the scheduling order had elapsed. Defendant
claimed that plaintiffs’ depositions had been conducted prior to the new discovery deadline and
that the depositions provided defendant with “a strong factual basis upon which to file a
dispositive motion.” In response to defendant’s motion, plaintiffs admitted that defendant had
previously filed a motion to extend dates, which we again note was heard by the trial court on
October 2, 2013, and that the court had “wisely declined to postpone the 10/18/13 dispositive
motion deadline.”6 The trial court denied defendant’s motion at a hearing on November 20,
2013. Plaintiffs had not yet filed an exhibit list. On November 21, 2013, defendant filed a
motion to strike plaintiffs’ witness list and any exhibit list should plaintiffs ever file one. The
basis for the motion was noncompliance with the deadlines in the scheduling order. In plaintiffs’
response to the motion, plaintiffs’ counsel indicated that he had never seen the scheduling order
and thus did not know about the deadlines. As gleaned from the affidavit of plaintiffs’ counsel,
he had not yet discovered the glitch concerning the “service contact” failure. Plaintiffs also

4
  There is no transcript of a hearing contained in the record, but the resulting order on
defendant’s motion suggests that a hearing was indeed conducted.
5
  Although the record is not entirely clear on the matter, we surmise that in e-filing plaintiffs’
witness list, plaintiffs’ counsel, without realizing it, registered his firm as a “service contact”
with respect to the case. A proof of service prepared by counsel himself provided, “I hereby
certify that on today’s date, October 16, 2013, I electronically filed the foregoing paper [witness
list] with the Clerk of the Court using the electronic filing system, which will send notification of
such filing.” This would explain why on October 16, 2013, plaintiffs’ counsel’s e-mail address
became registered as a service contact in the case. We note that the witness list was not
technically received by the court for filing until October 17, 2013.
6
    This is the deadline for dispositive motions set forth in the scheduling order.

                                                   -3-
argued that every witness on plaintiffs’ witness list appeared on defendant’s witness list, that all
of plaintiffs’ witnesses, except for one, had been identified by plaintiffs in answers to
interrogatories back in April 2013, and that defendant, given these circumstances, was not
surprised or unfairly prejudiced by the late filing. Plaintiffs pointed out that defendant and
plaintiffs, without objection, had conducted numerous depositions of witnesses, including
depositions of both plaintiffs, who were on the “tardy” witness list and after expiration of the
deadline.

         A hearing on defendant’s motion to strike was held on December 4, 2013. Late in the
day on December 3, 2013, plaintiffs’ counsel submitted an exhibit list, which was not received
for filing by the court until December 4, 2013. At the hearing, when plaintiffs’ counsel argued
that there was no surprise or prejudice given the interrogatory answers and the names already
identified on defendant’s witness list, the trial court remarked, “That’s not the standard.” The
trial court was especially angered by the last minute filing of the exhibit list before the hearing,
stating that it reflected counsel’s awareness of the failure to comply with the scheduling order,
reflected that the untimely filing of the witness list was not an isolated incident, and reflected “a
pattern.” The trial court granted the motion and struck both the witness and exhibit lists.

       On December 11, 2013, plaintiffs filed a motion for voluntary dismissal without
prejudice under MCR 2.504(A). A hearing on the motion was held on December 18, 2013. At
the hearing, the trial court ruled from the bench as follows:

               This motion now to dismiss voluntarily comes on the heels of the Court’s
       previous ruling. I grant the motion to dismiss; however, any and all orders that
       this Court entered in the current case will attach to any future filed case by the
       Plaintiff[s], inclusive of the Court’s granting of the motion to strike the witness
       and exhibit lists, because I’m satisfied that this motion to dismiss is an effort to
       circumvent the Court’s ruling as it relates to striking the witness and exhibit lists,
       and I will not allow the Plaintiff[s] to do so. So the motion is granted, with the
       condition attached that any future pleading or complaint filed, this Court’s
       previous orders follow any new filing.

        The record does not show that the trial court’s ruling was reduced to a written order, and
on December 31, 2013, plaintiffs filed a motion under MCR 2.612 for relief from judgment as to
the trial court’s ruling. The motion, which attached the affidavit of plaintiffs’ counsel that we
have referred to throughout this opinion, focused on the e-filing issue and the claimed
inadvertent failure to register counsel’s e-mail address as a service contact. Plaintiffs also
attached various computer-generated “service details” in regard to the case and the court’s e-
filing system. These service details indicated that two employees of the law firm representing
defendant at the time, one of whom was defense counsel, had opened the May 2013 e-filed
scheduling order, but not plaintiffs’ counsel. In the affidavit of plaintiffs’ counsel, he averred
that the court’s e-filer, who was responsible for the e-filing and e-service of the scheduling order
as reflected in the service details, informed counsel “that she had not served [counsel] with the
scheduling order” because he was not registered as a service contact at the time. Citing MCR
2.612(C)(1)(a) (“Mistake, inadvertence, surprise, or excusable neglect”), and claiming a lack of
prejudice, plaintiffs asked the trial court to set aside its earlier ruling striking the witness and

                                                -4-
exhibit lists, as well as the previous ruling dismissing the lawsuit with the attachment of
conditions to any new action.

        On January 8, 2014, the trial court held a hearing on plaintiffs’ motion for relief from
judgment. The trial court admonished plaintiffs’ counsel, as an attorney who practiced in the
Oakland County Circuit Court, for failing to comply with the e-filing registration requirement,
noting that filers are warned that they will not receive copies of court orders if they fail to
register their e-mail address as a service contact. The trial court indicated that “[n]either the
Court nor the county clerk provide[s] free copies of opinions, orders, or other electronically filed
documents to an attorney or party who fails to properly register with the Odyssey File & Serve
application.” The trial court proceeded to question plaintiffs’ counsel in regard to the computer-
generated service details, which indicated that numerous filings had been e-mailed to and opened
by counsel’s office and that, according to the court, showed that someone on plaintiffs’ behalf
had opened the e-file or e-mail with respect to the court-originated scheduling order. Counsel
was baffled and explained to the court, “I don’t know how to open something and look at a
scheduling order . . . .” We note that, as indicated above, the various e-filings that had indeed
been opened via plaintiffs’ counsel’s e-mail address had been e-mailed to counsel as the result of
defendant manually adding counsel as a service contact as to defendant’s court e-filings. But the
scheduling order originated from the trial court, not defendant’s counsel. And the trial court’s
reference to someone on plaintiffs’ behalf opening the e-mail revealing the scheduling order was
simply inaccurate, where it was actually a second person from the law firm representing
defendant who had opened it after defense counsel himself had earlier opened the e-mail.7

         The trial court next indicated that plaintiffs’ motion was more accurately coined a motion
for reconsideration and that plaintiffs’ counsel acknowledged being aware of the registration
requirement and simply failed to comply. The trial court then immediately concluded his ruling,
stating:

               However, as the Court noted, upon reviewing the history for service
       details and pleadings in this case, it appears that while no firm was specified to
       receive documents filed, that each – in each instance when a document was e-
       served that someone related to counsel’s client opened the pleadings on each
       occasion that they were filed.

        At this point, a discussion ensued regarding the fact that no order had been entered on the
trial court’s previous ruling. The trial court then signed a hastily-drafted, handwritten order that
denied plaintiffs’ motion for relief from judgment and which further provided:

7
  Upon examination of the service-detail records, the scheduling order was opened on the date it
was e-filed under the e-mail address of the particular defense attorney representing defendant at
the time. And on the following day, the e-filed scheduling order was opened under an e-mail
address with the same e-mail extension as defense counsel and in the name of a person who
throughout a portion of the litigation was identified as serving documents to plaintiffs on behalf
of defendant; we assume this was a secretary or paralegal employed by the firm representing
defendant.

                                                -5-
                 It is further ordered that this case is dismissed without prejudice & costs
         on the condition that all dates specified in the May 28, 2013 scheduling order and
         also the December 4, 2013 order striking Pl’s witness & exhibit lists shall apply to
         any subsequently filed lawsuits. This is a final order and disposes [of] all claims
         and parties.

        Plaintiffs appealed as of right. On appeal, plaintiffs argue that the trial court erred in
striking their witness and exhibit lists, and in subsequently imposing a sanction for plaintiffs’
failure to timely file those lists, which forever precluded plaintiffs from introducing evidence in
support of their claims. Plaintiffs contend that the failure to file the witness and exhibit lists was
due solely to an inadvertent and unintentional mistake, rather than willfulness, that there was no
demonstrable prejudice to defendant, and that there had been no history in the case of a failure to
comply with discovery requests and court orders.

        We find it necessary to first construct the proper analytical framework for purposes of
addressing this appeal. MCR 2.401 governs scheduling orders, which can encompass the setting
of deadlines for the exchange and filing of witness and exhibit lists, MCR 2.401(B)(2)(a). And
under MCR 2.401(I)(2), a trial court “may order that any witness not listed in accordance with
this rule will be prohibited from testifying at trial except upon good cause shown.”8 While MCR
2.401 does not expressly address exhibit lists, a trial court certainly also has the discretion to
strike an exhibit list that is not filed in conformance with a scheduling order. See EDI Holdings,
LLC v Lear Corp, 469 Mich 1021; 683 NW2d 146 (2004) (trial court did not abuse its discretion
when it enforced a summary disposition scheduling order); see also MCR 2.313(B)(2)(b) (court
has the authority to prohibit the introduction of matters into evidence for discovery violations).9
Considering that a plaintiff in a civil action has the burden of proof, there can be no reasonable
dispute that when a plaintiff’s witness and exhibit lists are struck, thereby precluding testimony
and the introduction of evidence, the plaintiff’s action is doomed and unsustainable. See Duray
Dev, LLC v Perrin, 288 Mich App 143, 164; 792 NW2d 749 (2010) (“Disallowing a party to call
witnesses can be a severe punishment, equivalent to a dismissal.”); Grubor Enterprises, Inc v

8
    We note that MCR 2.401(I)(1) provides in part:
                 No later than the time directed by the court under subrule (B)(2)(a), the
         parties shall file and serve witness lists. The witness list must include:

                 (a) the name of each witness, and the witness' address, if known; however,
         records custodians whose testimony would be limited to providing the foundation
         for the admission of records may be identified generally;

                 (b) whether the witness is an expert, and the field of expertise.

9
 Exhibit and witness lists are an element of discovery. Grubor Enterprises, Inc v Kortidis, 201
Mich App 625, 628; 506 NW2d 614 (1993).

                                                  -6-
Kortidis, 201 Mich App 625, 628; 506 NW2d 614 (1993) (“[D]isallowing the parties to testify
when the witness list is stricken or prevented from being filed is the equivalent of a dismissal.”).

        We confidently assume that had plaintiff here not swiftly filed the motion for voluntary
dismissal following entry of the order striking the witness and exhibit lists, defendant would
certainly have filed a motion for involuntary or summary dismissal. The trial court’s order
striking plaintiffs’ witness and exhibit lists had the practical effect of dismissing their lawsuit.
And the subsequent ruling expressly dismissing plaintiffs’ action, while flowing from plaintiffs’
motion for voluntary dismissal, was truly in the nature of an involuntary dismissal. See MCR
2.504(B)(1) (“If a party fails to comply with these rules or a court order, upon motion by an
opposing party, or sua sponte, the court may enter a . . . dismissal of the noncomplying party's
action or claims.”). Moreover, for the reasons stated above, although the dismissal was deemed
to be “without prejudice,” the dismissal was effectively “with prejudice,” in light of the fact that
any future action by plaintiffs would be saddled with the condition that they could not present the
testimony of witnesses, nor introduce exhibits, at trial, necessarily leading to dismissal of any
suit on a theory comparable to res judicata or collateral estoppel. In sum, the proper analysis
requires treating the trial court’s rulings as having resulted in an involuntary dismissal with
prejudice, with the ultimate question being whether the trial court erred in striking the witness
and exhibit lists.

         “This Court reviews for an abuse of discretion a trial court’s decision to bar witness
testimony after a party has failed to timely submit a witness list.” Duray Dev, 288 Mich App at
162. We note that the language of MCR 2.401(I)(2) indicating that a court “may order”
(emphasis added) the preclusion of a witness’s testimony supports the imposition of the abuse-
of-discretion standard. And an abuse of discretion exists when a trial court’s decision falls
outside the range of reasonable and principled outcomes. Maldonado v Ford Motor Co, 476
Mich 372, 388; 719 NW2d 809 (2006). We see no reason to conclude that a trial court’s
decision to strike an exhibit list implicates a different standard of review; therefore, we likewise
apply the abuse of discretion standard to the court’s decision to strike the exhibit list. See EDI
Holdings, 469 Mich at 1021. In the context of this case, the trial court essentially sanctioned
plaintiffs by striking the witness and exhibit lists, and in doing so the court made some
underlying factual findings with respect to the conduct of plaintiffs’ counsel, which findings we
review for clear error. MCR 2.613(C) (“Findings of fact by the trial court may not be set aside
unless clearly erroneous.”); Kitchen v Kitchen, 465 Mich 654, 661; 641 NW2d 245 (2002). “A
decision is clearly erroneous where, although there is evidence to support it, the reviewing court
is left with a definite and firm conviction that a mistake has been made.” Kitchen, 465 Mich at
661-662.

       The language of MCR 2.401(I)(2) indicates that a trial court may contemplate striking a
witness list for violation of its scheduling order, “except upon good cause shown” for the
noncompliance. Accordingly, the first step in the analysis is to examine whether there was
“good cause” for plaintiffs’ failure to comply with the scheduling order, which, if established,
would require reversal, and, if not established, would require examination of whether the
decision to impose sanctions nevertheless constituted an abuse of discretion under the
circumstances. The trial court did not find acceptable or excusable the failure by plaintiffs’
counsel to register his e-mail address as a service contact, which led to the service failure. We
do note that while we understand and appreciate the rule implemented by the Oakland Circuit

                                                -7-
Court under the authority of AO 2007-3 that a party must register an e-mail address as a service
contact or else the party will not be served with court orders, it would seem that when it comes to
something as important as a scheduling order, the court’s e-filer might as a courtesy, if at all
feasible and conducive to the system, simply contact counsel to make him or her aware of any
registration failure. Plaintiffs’ complaint listed the e-mail address, phone number, and business
address of counsel. That said, we do agree with the trial court that counsel had an obligation to
know and comply with the court’s rules on e-filing. We also note that although the deadline for
filing the witness and exhibit lists had already passed at the end of August 2013, plaintiffs’
counsel in late September 2013 and early October 2013 did not appear to make any inquiries to
the court about any scheduling order or rush to file the lists despite having knowledge of
defendant’s motion to extend deadlines and the resulting ruling. We conclude that plaintiffs
have not shown “good cause” for failing to comply with the scheduling order with respect to the
deadline for filing and exchanging witness and exhibit lists. And plaintiffs do not appear to even
argue that “good cause” existed for the noncompliance. Rather, plaintiffs’ argument is focused
on the claim that the sanction, effectively a dismissal of plaintiffs’ suit with prejudice, was not
proper in light of all of the circumstances and the lack of prejudice to defendant.

       Moving to the issue regarding whether the trial court abused its discretion in striking the
witness and exhibit lists and in effectively dismissing plaintiffs’ suit with prejudice, we first note
an underlying factual error made by the trial court, alluded to above, that the e-filed scheduling
order had been opened by someone on plaintiffs’ behalf. For the reasons discussed earlier, this
finding was clearly erroneous, where it was two members of the law firm representing defendant
that had opened e-mails pertaining to the scheduling order, or someone with access to their e-
mail accounts, and not anyone on plaintiffs’ behalf. Further, the trial court appeared to place a
great emphasis on its mistaken finding in rendering its decision, which in and of itself mandates
reversal. Additionally, the trial court did not undertake the required analysis discussed in Duray
Dev, wherein this Court observed:

               Once a party has failed to file a witness list in accordance with the
       scheduling order, it is within the trial court's discretion to impose sanctions
       against that party. These sanctions may preclude the party from calling witnesses.
       Disallowing a party to call witnesses can be a severe punishment, equivalent to a
       dismissal. But that . . . does not mean that . . . a trial court cannot impose such a
       sanction even if it is equivalent to a dismissal. Because the decision is within the
       trial court's discretion, caselaw mandates that the trial court consider “the
       circumstances of each case to determine if such a drastic sanction is
       appropriate.” “[T]he record should reflect that the trial court gave careful
       consideration to the factors involved and considered all of its options in
       determining what sanction was just and proper in the context of the case before
       it.” Relevant factors can include, but are not limited to,

               “(1) whether the violation was wilful or accidental; (2) the party's history
       of refusing to comply with discovery requests (or refusal to disclose witnesses);
       (3) the prejudice to the defendant; (4) actual notice to the defendant of the witness
       and the length of time prior to trial that the defendant received such actual notice;
       (5) whether there exists a history of plaintiff's engaging in deliberate delay; (6) the
       degree of compliance by the plaintiff with other provisions of the court's order;

                                                 -8-
       (7) an attempt by the plaintiff to timely cure the defect[;] and (8) whether a lesser
       sanction would better serve the interests of justice. This list should not be
       considered exhaustive.”

                                               ...

               Here, the record does not reflect that the trial court gave consideration to
       these factors or considered all of its options in determining what sanction was just
       and proper in the context of the case before it. Therefore, on remand the trial court
       should reassess [the] request to testify, taking the above-mentioned factors into
       consideration and explaining its determination on the record. [Duray Dev, 164-
       166 (citations omitted; initial two alterations in original).]

        Here, given the trial court’s erroneous factual finding regarding who opened the e-filed
scheduling order, and given the trial court’s failure to give consideration, let alone careful
consideration, to the factors set forth in Duray Dev, we reverse and remand for further
proceedings. Just as ordered in Duray Dev, we direct the trial court to consider the relevant
factors and to explain its ultimate ruling on the record.

        Reversed and remanded for further proceedings consistent with this opinion. We do not
retain jurisdiction. We decline to award taxable costs under MCR 7.219.

                                                             /s/ William B. Murphy
                                                             /s/ Cynthia Diane Stephens
                                                             /s/ Michael F. Gadola

                                               -9-