GREGORY J REED V KENNETH M DAVIES
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STATE OF MICHIGAN
COURT OF APPEALS
GREGORY J. REED,
UNPUBLISHED
March 11, 2004
Plaintiff-Appellant,
v
KENNETH M. DAVIES, KENNETH M.
DAVIES, P.C., GARY A. BENJAMIN, and LAW
OFFICES OF GARY A. BENJAMIN, P.C.,
No. 242709
Wayne Circuit Court
LC No. 02-208797-NM
Defendants-Appellees.
Before: Hoekstra, P.J., and Sawyer and Gage, JJ.
PER CURIAM.
Plaintiff appeals as of right an order of the trial court granting defendants’ motion for
summary disposition, dismissing his claim for legal malpractice, and granting sanctions in favor
of defendants. We affirm.
The instant case arises out of plaintiff’s May 1992 retention of defendant Davies to
represent him in a condemnation action. When Davies took an extended vacation from fall 1993
to January 1994, he enlisted defendant Benjamin to represent plaintiff in his stead. In December
1993, the trial court entered default against plaintiff because of his repeated failure to attend
scheduled depositions; as a result, the trial court decided the remaining issues in a nonjury
hearing. Benjamin stopped representing plaintiff as of January 1994, and Davies stopped
representing defendant as of August 1995.
In December 1997, Davies sued plaintiff to recover payment for legal services rendered
in the condemnation action. In February 1998, plaintiff counter-claimed against Davies for
professional negligence based on Davies’ alleged failure to perform legal services provided
under the terms of their May 1992 contract. Benjamin was not a party to the underlying claim or
the counter-claim. In May 1998, plaintiff and Davies signed a settlement agreement which
acknowledged the existence of an attorney lien for any fees on the proceeds received by plaintiff
from the condemnation action. Additionally, the parties agreed that upon resolution of the
condemnation claim, they were to decide by mutual agreement the amount of Davies’ total
attorney fees, and that any unresolved dispute between claimed attorney fees in the matter was to
be ultimately decided by the trial court. In June 1998, plaintiff and Davies stipulated to dismiss
“without prejudice and without costs, all of the claims, counter-claims, and third-party claims of
the parties, reserving to each their respective rights and defenses available to the parties on all of
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the claims, counter-claims, and third-party claims as of December 30, 1997, the date of filing of
the original Complaint in this matter.”
The condemnation case was eventually resolved by consent judgment in March 2001.
Because the parties could not agree on the amount of attorney fees due Davis, an evidentiary
hearing was held in November 2001 pursuant to the settlement agreement. Davies testified that a
$600,000 settlement offer was made to resolve plaintiff’s claims in the condemnation action.
Plaintiff now claims that Davies never communicated such an offer, and that the first time he
learned of such an offer was at the November 2001 evidentiary hearing. Plaintiff also now
claims that Davies presented him with a “fraudulent” billing statement at the hearing.
In March 2002, plaintiff filed the instant legal malpractice claim against defendants
Davies and Benjamin. The trial court granted defendants’ motion for summary disposition
pursuant to MCR 2.116(C)(7) and dismissed plaintiff’s claim on the basis that the statute of
limitations had expired. The trial court also imposed sanctions against plaintiff pursuant to MCR
2.114(E), on the basis that plaintiff did not conduct a reasonable inquiry into the validity of his
claims. The trial court stated:
I’m going to grant dismissal in this case . . . This matter incredibly began on April
29th, 1991, no doubt a date Avery Williams would like to have avoided, when the
City of Detroit filed an action against [plaintiff] and others to condemn property .
. . and the matter indeed was not resolved under January 2001 when this matter
was settled.
In 1997 [defendant Benjamin] filed a suit to recover his – for fees expanded – to
recover fees for time expended in this – in the ’91 case in a case styled
[defendant] Davies against [plaintiff] Reed . . .
That case produced a counterclaim filed by counsel for [plaintiff] against
[defendant] Davies asserting malpractice in the 1991 case. It was asserted as a
defense and asserted as a counter complaint seeking money damages for the
failure to represent [plaintiff] appropriately. And as counsel has pointed out the
case was resolved by a stipulation which resulted in an order of dismissal. The
matter was dismissed without prejudice and pursuant to the stipulation of the
parties. And the stipulation claim incorporated both the claim and the
counterclaim and it read in full . . . now come the parties through their respective
counsel and do hereby stipulate and agree to dismiss without prejudice and
without cost all of the claims, counterclaims and third party claims of the parties,
reserving to each their respective rights and defenses available to the parties on all
of the claims, counterclaims and third party claims as of December 30, 1997, the
date of filing of the original complaint in this matter. There is no waiver of
defenses. And all if says is that if the suit is brought again nothing – the suit
counts for nothing. But it’s certainly not this Court’s ruling that this adjudication
should take place as of December 30, 1997. We still adjudicate this case as of
2002 and hear any defenses available to the parties.
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The defense asserted is in this current case which was filed March 14, 2002, that
the Statute of Limitations has run in the case because of the age of the lapse of
representation . . . by [defendant] Davies of [plaintiff], and the Court fully agrees.
First of all, while the case is dismissed, I’m going to take . . . Plaintiff’s . . .
representation made in the . . . 1997 case as binding. He says, and I may grant
him a few days leeway, that . . . the Defendant Davies represented Plaintiff Reed
until August 2nd, 1995. I think there was an omitted digit and it was probably
August 24th. But – or August 25, excuse me, 1995 . But whichever date it is, the
two-year Statute of Limitations would have run by August 25, 1997. And in that
respect the Defendant Davies cannot be sued because the claim is time barred.
There are two arguments with respect to Davies that counsel has asserted here.
[Plaintiff’s counsel] has argued that because [defendant] Davies has billed
[plaintiff] Reed for time spent in collecting his bill and pursuing his – the
collection issue that is now before the Court, that somehow it renews the
representation. Nothing could be further from the truth. If anything, the fact that
the fee dispute is now hotly ongoing, means that the parties are more adverse than
they’ve ever been. And I don’t think [plaintiff] could believe in any flight of
fancy that [defendant] Davies by pressing a claim for fees against him is acting as
[plaintiff’s] lawyer in that respect, and that claim is rejected out of hand.
Secondly, as we’ve discussed substantially on this record, the other claim against
[defendant] Davies – the claim that the Statute of Limitations does not bar
[plaintiff’s] claim is based on the idea of newly discovered evidence.
And [defendant] Davies’ surprise as expressed in the transcript . . . that that
testimony of recent discovery of [defendant] Benjamin’s role in the case provides
a basis both to proceed against [defendant] Davies and to proceed against
[defendant] Benjamin.
As the Court has pointed out when a lawyer makes a claim for legal malpractice
against another lawyer for conduct arising out of the case, this Court finds as a
matter of law that there’s a duty to examine the case file. And that Rule 2.114 of
the Michigan Court Rules is not satisfied unless that is done.
Since the statute 600.5838(2) requires that a Plaintiff in these circumstances bears
the burden of showing that he either discovered or should have discovered the
existence of the claim, this Court finds that [plaintiff] through counsel should
have done so when – in preparation for the assertion of malpractice in the 1997
case. The failure to do that is fatal to the cause of action here.
The Plaintiff by merely examining the files that were available to anybody in this
case would have discovered . . . [defendant] Benjamin’s role which completely
exonerates him and in this Court’s view also would put him on reasonable inquiry
notice about why [defendant] Benjamin was representing [plaintiff] suddenly and
without arguably notice to [plaintiff], and he would have been able to make
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inquiry to make that determination at the point at which he filed the 1998 counter
complaint.
The Court is also very troubled by the timing of this claim, I need to state I think
there may be a reason, [plaintiff’s counsel], why you have been brought in as a
newcomer to this case when Mr. Shakoor represents [plaintiff] in the fee dispute
and represented [plaintiff] during the 1997 case. You’re brought in as the
innocent. When Mr. Shakoor might have been more reluctant to raise this in light
of his recollection of what happened in the prior suit, and I’m troubled by that.
I am troubled by the timing of this separate lawsuit filed independently, sent to
another court by the failure to follow the certification rule, rather than having this
matter brought here. And I truly wonder whether this was to follow 2.114(D)(3),
interposed for an improper purpose such as to harass or cause unnecessary delay
or endless increase in the cost of litigation.
The proliferation of separate charges, separate Defendants in the acquisition case,
fractionation of claims has caused nothing but confusion for a decade. And I
sense that that pattern occurs here in the filing of this belated malpractice case,
not only against [defendant] Davies but against [defendant] Davies’ lawyer in the
collection issue when we needed to get to a result in the fee issue.
This appeal ensued.
On appeal, plaintiff challenges the trial court’s granting of defendants’ motion for
summary disposition under MCR 2.116(C)(7). This Court reviews a trial court’s decision on a
motion for summary disposition pursuant to MCR 2.116(C)(7) de novo. DiPonio Construction
Co, Inc v Rosati Masonry Co, Inc, 246 Mich App 43, 46-47; 631 NW2d 59 (2001).
Additionally, whether plaintiff’s claim is statutorily time-barred is a question of law for this
Court to decide de novo. Id. at 47. When reviewing a trial court’s decision granting a motion for
summary disposition under MCR 2.116(C)(7), this Court must consider all documentary
evidence submitted by the parties and accept the nonmoving party’s well-pleaded allegations,
except those contradicted by documentary evidence, as true, and construe those allegations in
favor of the nonmoving party. Id. at 46, n 2.
Plaintiff first argues that his legal malpractice claim was filed within the two year statute
of limitations as required by MCL 600.5805(5). We disagree. Generally, “a legal malpractice
claim must be brought within two years of the date the attorney discontinues serving the client,
or within six months after the plaintiff discovers or should have discovered the existence of the
claim, whichever is later.” MCL 600.5805(5); MCL 600.5838; Maddox v Burlingame, 205 Mich
App 446, 450; 517 NW2d 816 (1994). “A lawyer discontinues serving a client when relieved of
the obligation by the client or the court, or upon completion of a specific legal service that the
lawyer was retained to perform.” Id.
Plaintiff maintains that his claim did not accrue against Benjamin until October or
November 2001, when Benjamin allegedly breached his duty to plaintiff by representing Davies
at the evidentiary hearing on attorney fees, thereby creating a conflict of interest. Plaintiff’s
claim is wholly without merit, because the record reveals that Benjamin discontinued
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representing plaintiff in January 1994. Any claim of legal malpractice against Benjamin expired
in January 1996, and the instant claim was not filed until March 2002.
Plaintiff next argues that his claim did not accrue against Davies until November 2001,
when Davies submitted a billing statement reflecting fees incurred for “representing” him in
October and November 2001. Again, plaintiff’s claim is wholly without merit. The record
reveals that such fees were related to Davies’ collection efforts on the underlying condemnation
action, and can in no way be construed as fees for representing plaintiff. Davies discontinued
representing plaintiff in August 1995. Any claim of legal malpractice against Davies expired in
August 1997, and the instant claim was not filed until March 2002. Accordingly, plaintiff’s
claim was timely filed only if he filed his complaint within the six-month discovery period
allowed by MCL 600.5838(2).
Next, plaintiff asserts that his discovery of Davies’ failure to inform him of a $600,000
settlement offer constituted newly discovered evidence, and therefore his claim for legal
malpractice was not barred by the statute of limitations. We disagree. The discovery rule set out
in MCL 600.5853(2) allows commencement of an action within six months after a plaintiff
discovers or should have discovered the existence of a claim. But in Moll v Abbott Laboratories,
444 Mich 1, 23-24; 506 NW2d 816 (1993), our Supreme Court held that “the standard under the
discovery rule is not that the plaintiff knows of a ‘likely’ cause of action. Instead, a plaintiff
need only discover that he has a ‘possible’ cause of action.” Gebhardt v O’Rourke, 444 Mich
535, 544; 510 NW2d 900 (1994). In the instant case, plaintiff argues that he was not aware of
his possible cause of action in legal malpractice against Davies until the evidentiary hearing in
November 2001, where Davies testified that he received a $600,000 settlement offer in the
condemnation action. However, it is evident that plaintiff was aware that he had a possible cause
of action against Davies in February 1998, when he filed the counter-complaint alleging the
elements of a legal malpractice claim. Discovery of plaintiff’s cause of action occurred no later
than February 1998, some four years before he filed the instant claim. Therefore, his claim is
barred by the six-month discovery provision.
This Court has held that “the discovery rule does not act to hold a matter in abeyance
indefinitely while a plaintiff seeks professional assistance to determine the existence of a claim.”
Turner v Mercy Hospitals & Health Services of Detroit, 210 Mich App 345, 353; 533 NW2d 365
(1995). “A plaintiff must act diligently to discover a possible cause of action and ‘cannot simply
sit back and wait for others’ to inform [him] of its existence.” Id., quoting Grimm v Ford Motor
Co, 157 Mich App 633, 639; 403 NW2d 482 (1986). Further, MCL 600.5838(2) places the
burden of proof on plaintiff to show that he neither discovered nor should have discovered the
claim more than six months before he filed suit. Plaintiff has failed to meet that burden. Davies
testified that he informed plaintiff of the offer, plaintiff contends that he did not. Plaintiff,
however, has failed to provide the appropriate argument to support his claim that he was unaware
of the settlement offer and he has failed to support his argument with evidence beyond the
assertion made in his affidavit. Moreover, plaintiff has failed to establish that he could not have
discovered this particular allegation earlier in this string of litigation. We cannot and will not
search for argumentative support for a party’s claim, especially when the burden of proof is on
that party. We are not persuaded by plaintiff’s argument that he was not aware of the $600,000
settlement offer until November 2001. Because we do not believe that any factual development
as to the existence of plaintiff’s knowledge of the settlement offer could provide a basis for
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recovery, we believe the trial court properly granted summary disposition in favor of defendant,
on the basis that plaintiff’s malpractice action was barred by the six-month discovery provision
of MCL 600.5838(2). Jackson Co Hog Producers v Consumers Power Co, 234 Mich App 72,
77; 592 NW2d 112 (1999).
Plaintiff further argues that defendants fraudulently concealed their negligence from him
by Davies concealing that he “abandoned” plaintiff’s case for three and a half months while he
took an extended vacation; Davies and Benjamin concealing that Davies enlisted Benjamin to
represent plaintiff while he was away, where Benjamin did not have adequate knowledge or
experience to represent plaintiff in the condemnation action; Davies breaching his duty to
disclose a $600,000 settlement offer made to plaintiff in the condemnation action; and Davies
submitting a “fraudulent” billing statement in November 2001. We disagree.
MCL 600.5855 provides that the statute of limitations is tolled when a party conceals the
fact that the plaintiff has a cause of action. Phinney v Perlmutter, 222 Mich App 513, 562-563;
564 NW2d 532 (1997); Sills v Oakland General Hospital, 220 Mich App 303, 310; 559 NW2d
348 (1996). “The plaintiff must plead in the complaint the acts or misrepresentations that
comprised the fraudulent concealment.” Id. “The fraud must be manifested by an affirmative
act or misrepresentation,” unless the defendant owed an affirmative duty to disclose information
because of a fiduciary relationship with the plaintiff. Brownell v Garber, 199 Mich App 519,
524; 503 NW2d 81 (1993). Further, plaintiff has the burden of establishing defendant’s fraud.
Id. at 531.
Plaintiff fails to support his allegations of fraudulent concealment with any authority. It
is well settled that “a party may not leave it to this Court to search for authority to sustain or
reject its position.” In re Keifer, 159 Mich App 288, 294; 406 NW2d 217 (1987). Moreover, “a
bald assertion without supporting authority precludes appellate examination of the issue.”
Impullitti v Impullitti, 163 Mich App 507, 512; 415 NW2d 261 (1987). We believe that plaintiff
failed to plead his claim of fraudulent concealment with sufficient specificity, and his allegations
are wholly unsubstantiated. Although plaintiff alleges that Davies and Benjamin concealed the
fact that Benjamin acted as counsel for plaintiff in Davies’ stead, we agree with the trial court’s
reasoning that such information was readily available to plaintiff. Concerning Davies’ alleged
failure to convey a $600,000 settlement offer in the condemnation claim, we reiterate that
plaintiff has set forth no evidence in support of such claim. Finally, plaintiff has not
demonstrated that any new evidence was discovered when Davies provided him with the
supplement billing statement. Plaintiff’s argument that the statute of limitations should be tolled
pursuant to MCL 600.5855 is without merit, and the trial court properly granted defendants’
motion for summary disposition pursuant to MCR 2.116(C)(7) on this basis.
Plaintiff next argues that the trial court erred in awarding defendant sanctions, pursuant to
MCR 2.114. We review a trial court’s decision regarding the imposition of sanctions under
MCR 2.114(E) for clear error. Schadewald v Brule, 225 Mich App 26, 41; 570 NW2d 788
(1997). The trial court’s decision is clearly erroneous when, although there is evidence to
support it, the reviewing court is left with a definite and firm conviction that a mistake has been
made. Id.
MCR 2.114(E) mandates sanctions against a party or an attorney who signed a pleading
knowing that it is devoid of legal merit or that it is intended for an improper purpose, such as to
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harass the opposing party. MCR 2.114(D), MCR 2.114(E). In the instant case, the trial court
explained that it was imposing sanctions on plaintiff because it was evident that the statute of
limitations had expired, and because it appeared the claim was brought in order to harass
defendants. Plaintiff argues that the trial court’s decision was clearly erroneous because “there
was no way [he] could have learned about the settlement offer prior to Davies’ November 2001
testimony because it was not a part of the court records or files and Davies failed to
communicate it to him. Nor could [he] have asserted a claim against Davies for his fraudulent
bill prior to receiving it on November 6, 2001.” However, plaintiff has failed to cite any
authority in support of his position. A party may not merely announce his position and leave it
to this Court to discover and rationalize the basis for his claims, Wilson v Taylor, 457 Mich 232,
243; 577 NW2d 100 (1998), nor may he give issues cursory treatment with little or no citation of
supporting authority. Houghton v Keller, 256 Mich App 336, 339; 662 NW2d 854 (2003). The
trial court’s determination that plaintiff’s claim was devoid of legal merit is not clearly
erroneous, and we affirm the award of sanctions.
Affirmed.
/s/ Joel P. Hoekstra
/s/ David H. Sawyer
/s/ Hilda R. Gage
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