Opinion
No. 346900
04-02-2020
SATURN ELECTRONICS CORPORATION, Plaintiff/Counterdefendant-Appellant, v. ISHVAR SUTARIYA and PRAVIN SUTARIYA, Defendants/Counterplaintiffs-Appellees.
If this opinion indicates that it is "FOR PUBLICATION," it is subject to revision until final publication in the Michigan Appeals Reports. UNPUBLISHED Wayne Circuit Court
LC No. 14-012535-CB Before: M. J. KELLY, P.J., and FORT HOOD and BORRELLO, JJ. PER CURIAM.
Plaintiff appeals as of right an order granting in part and denying in part defendants' renewed motion for case evaluation sanctions, presenting us only with the narrow issue whether defendant's request for case evaluation sanctions was timely under MCR 2.403(O)(8). For the reasons set forth in this opinion, we affirm.
I. BACKGROUND
This case was before us previously, when we addressed plaintiff's appeal from a "stipulated order and judgment entered in favor of defendants, Ishvar Sutariya and Pravin Sutariya, in the amount of $295,000 for attorney fees, costs, and expenses awarded pursuant to the parties' "Stock Purchase Redemption Agreement" (the "Agreement")." Saturn Electronics Corp v Sutariya, unpublished per curiam opinion of the Court of Appeals, issued June 21, 2018 (Docket No. 335912), p 1. For the sake of providing context, we repeat our previous, brief factual summary again here:
This case arises from allegations that defendants, who were officers, directors, shareholders, and employees of plaintiff, sold scrap metal belonging to plaintiff for cash and converted the cash for their own use. Plaintiff claims that defendants entered into the Agreement without disclosing the scrap sales and that defendants subsequently interfered with plaintiff's business. The trial court ruled that (1) plaintiff's pre-redemption claims were barred by a release contained in the Agreement, (2) an indemnification provision of the Agreement required plaintiff to
indemnify defendants for their attorney fees incurred in the action, and (3) plaintiff failed to establish a genuine issue of material fact regarding causation with regard to its claims alleging interference. [Id.]
In plaintiff's prior appeal, we affirmed the trial court's first and third rulings stated above. Id. at 5, 8.
With respect to the trial court's ruling regarding the indemnification provision, the trial court record indicates that it determined that defendants' request for case evaluation sanctions under MCR 2.403(O), which was made contemporaneously with defendants' motion for summary disposition on its counterclaim for indemnification, was moot in light of its decision that the indemnification provision entitled defendants to attorney fees and costs from plaintiff. A stipulated order was entered pursuant to this ruling that expressly stated, "If this case is remanded for any reason, Defendants reserve and preserve all rights with respect to their Motion for Case Evaluation Sanctions, which this Court determined to be moot for the reasons set forth in its Indemnification Opinion and Order."
Also, in the prior appeal, this Court determined that the "trial court improperly granted summary disposition in favor of defendants on their counterclaim for indemnification" and reversed the trial court's ruling on that issue. Id. at 6, 8. We specifically concluded that "the trial court erred by holding that the language requiring plaintiff to indemnify defendants for 'any claims [or] liabilities' brought against defendants also required plaintiff to indemnify defendants for their attorney fees incurred in defending against any claims." Id. at 6.
On August 27, 2018, defendants filed a renewed motion for case evaluation sanctions in the trial court. Defendants maintained that they had originally filed a timely motion for case evaluation sanctions but that it was found "moot" and never decided on the merits because the trial court had concluded that defendants were entitled to be fully reimbursed for reasonable attorney fees on alternate grounds. Defendants argued that their request for case evaluation sanctions was no longer moot now that the trial court's ruling had been reversed on this issue.
The trial court issued a written opinion and order granting in part defendants' renewed motion for case evaluation sanctions, concluding that the motion was timely because defendants' initial motion for case evaluation sanctions had been timely filed but found moot at that time by the trial court due to its ruling regarding the indemnification clause. The trial court reasoned that "[u]nder the circumstances, [it] was not otherwise precluded from ruling on Defendants' renewed motion for case evaluation sanctions." The trial court denied defendants' renewed motion in part, concluding that defendants were entitled to a lower total amount of attorney fees than they had requested.
This appeal ensued. The sole issue currently before this Court is whether defendants' request for case evaluation sanctions was timely.
II. STANDARD OF REVIEW
A trial court's determination whether to grant case evaluation sanctions under MCR 2.403(O) is a question of law, which we review de novo. Peterson v Fertel, 283 Mich App 232, 235; 770 NW2d 47 (2009). We also review de novo, as a question of law, the proper interpretation and application of a court rule. Haliw v Sterling Hts, 471 Mich 700, 704; 691 NW2d 753 (2005).
III. ANALYSIS
MCR 2.403(O)(1) provides in pertinent part that "[i]f a party has rejected an evaluation and the action proceeds to verdict, that party must pay the opposing party's actual costs unless the verdict is more favorable to the rejecting party than the case evaluation." Plaintiff argues on appeal that defendants failed to timely request case evaluation sanctions under MCR 2.403(O)(8), which provides as follows:
There is no dispute that a unanimous case evaluation award of $500,000 was issued in favor of plaintiff, that plaintiff rejected the evaluation, and that defendants accepted it.
A request for costs under this subrule must be filed and served within 28 days after the entry of the judgment or entry of an order denying a timely motion
(i) for a new trial,
(ii) to set aside the judgment, or
(iii) for rehearing or reconsideration.
According to plaintiff, defendants were required by this provision to renew their request for case evaluation sanctions within 28 days of this Court's opinion that was issued on June 21, 2018. Defendants filed their renewed motion for case evaluation sanctions in the trial court on August 27, 2018, which was 67 days after our opinion was issued.
However, MCR 2.403(O) is "a trial-oriented court rule." Haliw, 471 Mich at 708; see also id. at 711 (holding that "appellate attorney fees and costs are not recoverable as case evaluation sanctions under MCR 2.403(O)"). Plaintiff does not argue in the instant appeal that defendants' initial motion for case evaluation sanctions under MCR 2.403(O) was untimely. When this Court reversed the trial court's ruling that an alternate ground existed that entitled defendants to attorney fees and costs, defendants were free to renew their request in the trial court for case evaluation sanctions under MCR 2.403(O). Furthermore, defendants also had 42 days in which they could have sought leave to appeal in the Michigan Supreme Court in order to challenge this Court's ruling that the indemnity provision did not require plaintiff to indemnify defendants for their attorney fees, MCR 7.305(C)(2)(a), thus negating any implication that they had to pursue their motion under MCR 2.403(O) first in the trial court within 28 days.
Plaintiff also could have sought leave to appeal during that time. --------
Regardless, given that MCR 2.403(O) is a trial-oriented court rule, it simply has no bearing on providing any timing limitation for when a motion seeking case evaluation sanctions must be filed following an appellate court decision reversing the trial court's previous ruling that concerns that issue. We cannot read additional language into an unambiguous court rule. Freysinger v Taylor Supply Co, 197 Mich App 349, 355; 494 NW2d 870 (1992). We additionally note that because defendants' initial timely request for case evaluation sanctions put plaintiff on notice that defendants were seeking to recover these costs, the purpose of MCR 2.403(O) to "prevent 'stale motions for costs' " will not be frustrated by affirming the trial court's ruling in this case. See Badiee v Brighton Area Sch, 265 Mich App 343, 376-377; 695 NW2d 521 (2005).
Accordingly, the trial court did not err by determining that it could address the merits of defendants' request for case evaluation sanctions under MCR 2.403(O).
Affirmed. Defendants having prevailed in full are entitled to costs. MCR 7.219.
/s/ Michael J. Kelly
/s/ Karen M. Fort Hood
/s/ Stephen L. Borrello