STEVEN DALE MAURO V GARY R HOSBEIN
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STATE OF MICHIGAN
COURT OF APPEALS
STEVEN DALE MAURO,
UNPUBLISHED
May 15, 2008
Plaintiff-Appellant,
v
No. 277277
Cass Circuit Court
LC No. 07-000034-NM
GARY R. HOSBEIN,
Defendant-Appellee.
Before: Jansen, P.J., and Zahra and Gleicher, JJ.
PER CURIAM.
In this legal malpractice case, plaintiff appeals as of right a circuit court order granting
defendant summary disposition pursuant to MCR 2.116(C)(7) (expiration of the statute of
limitations). Plaintiff also challenges a judgment awarding defendant costs and attorney fees as a
sanction for plaintiff’s selection of an improper venue. We affirm in part and reverse in part.
I. Facts and Proceedings
In July 1994, the Cass County prosecuting attorney filed a fourth-degree criminal sexual
conduct charge against plaintiff, who then worked for Berrien County as a court psychologist.
Because the complainant was also a Berrien County court employee, the Berrien County
prosecutor’s office disqualified itself from pursuing the charge. The Cass County prosecutor’s
office assumed the responsibility of prosecuting plaintiff. In October or November 1994, the
Cass County prosecutor filed additional charges against plaintiff alleging two counts of
misdemeanor assault and battery involving other complainants.
Plaintiff retained defendant, a Berrien County attorney, to defend the criminal charges.
On September 15, 1994, the Berrien Circuit Court judge assigned to defendant’s case filed a
notice of disqualification, and the case was reassigned to the Kalamazoo Circuit Court in
October 1994. In January 1995, however, a Kalamazoo Circuit Court judge transferred the case
back to the Berrien District Court, where plaintiff pleaded nolo contendere to a misdemeanor
charge. The prosecution subsequently dismissed the remaining charges pursuant to a plea
agreement. In the interim, plaintiff filed for divorce in Tuscola County, and one of the alleged
victims sued plaintiff and several Berrien Circuit Court employees in Berrien County.
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Defendant represented plaintiff in the criminal matters until October 1995. In 1997,
defendant briefly represented plaintiff in the divorce action, which had been transferred to
Berrien County. The parties agree that defendant has not provided plaintiff with any legal
services for approximately 11 years, since 1997.
On January 23, 2007, plaintiff filed a “verified complaint” against defendant in the Cass
Circuit Court. The complaint alleged that defendant “pressured” plaintiff into ultimately
entering the nolo contendere plea agreement by advising him that he “would not get a fair trial in
Berrien County because the judges were extremely angry with Plaintiff, as well as with
Defendant for representing Plaintiff.” Plaintiff further alleged that defendant inaccurately
counseled that the plea agreement would not endanger his psychology and teaching licenses, and
that plaintiff’s name would not have to appear on the Michigan Sex Offender Registry.1 In
addition to these factual allegations, plaintiff’s verified complaint set forth the following three
alleged breaches of defendant’s duty of care, together with a single paragraph addressing
causation:
2.
Defendant breached his duty to Plaintiff by not conducting a
reasonable factual investigation of the charges against Plaintiff.
3.
Defendant breached his duty to Plaintiff by failing to conduct a
reasonable legal investigation of the legal issues surrounding the charges against
Plaintiff.
4.
Defendant was negligent in failing to adequately advise Plaintiff of
the legal ramifications of pleading nolo contendere to the charges.
5.
Defendant’s deficient performance at the time of the plea
agreement prejudiced Plaintiff’s case resulting in an involuntary plea agreement.
The “relief” sought included a “[j]udgment against Defendant for all fees paid to Defendant,” for
“all moneys paid by Plaintiff to defend his psychology license and teaching certificate,” and for
plaintiff’s loss of income since July 1994.
In February 2007, defendant filed a motion for summary disposition in lieu of an answer,
pursuant to MCR 2.116(C)(7) and MCR 2.111(F)(2)(a). Alternatively, defendant sought a
change of venue, proposing in his supporting brief that “should the Court not dismiss the
complaint with prejudice, Plaintiff [sic] requests change of improper venue pursuant to MCR
2.223 and MCL[] 600.1653 to Berrien County, Michigan, with imposition of appropriate costs,
attorney fees and sanctions.”
1
In September 1996, the Michigan Board of Psychology suspended plaintiff’s psychologist
license for six months. The Michigan Department of Education suspended plaintiff’s teaching
certificate in March 1996, and revoked it in January 2001.
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In response to defendant’s motions, plaintiff asserted that “[u]p until August 4, 2006, Dr.
Mauro believed Mr. Hosbein was a very good attorney, and it was the prosecution and court
personnel who were the cause of his injury.” According to a January 2007 affidavit of plaintiff,
he discovered defendant’s malpractice on August 4, 2006, when “I requested my present attorney
… to review my files and advise me regarding a reversal of my plea agreement.” Plaintiff’s
response also contained his February 2007 affidavit insisting that he did not know that his felony
prosecution had been transferred from Berrien to Kalamazoo County until he read it in
defendant’s summary disposition pleadings.
On March 12, 2007, the circuit court heard defendant’s motions for summary disposition
and change of venue and granted both of them, ruling from the bench, in relevant part as follows:
First of all, let’s take up the venue issue, MCR 2.223(B)(1) provides for
sanctions in the event you file in the wrong court, and I think this action was
clearly filed in the wrong court. …
So [venue in] this action was improperly laid in Cass County.
According[ly], you’re entitled to those expenses you have itemized for attending
the wrong court under the authority of that court rule, 2.223.
Now, we also have a summary disposition argued by the defendant
pursuant to MCR 2.116(C)(7), and that’s for failing to satisfy the Statute of
Limitations. The Court finds that the Statute of Limitations has clearly run in this
case. Certainly the plaintiff could have or should have known at the very latest
back in about 1997 that he had a claim for alleged malpractice; that he discovered
or should have discovered it back that far.
The circuit court awarded defendant costs ($52.98), and a “reasonable” attorney fee ($1,000).
II. Issues Presented and Analysis
Plaintiff challenges on appeal both the circuit court’s grant of summary disposition and
its award of sanctions for improper venue. We review de novo a circuit court’s summary
disposition ruling. Walsh v Taylor, 263 Mich App 618, 621; 689 NW2d 506 (2004). A motion
for summary disposition brought under subrule (C)(7) does not test the merits of a claim, but
rather certain defenses that may eliminate the need for a trial. DMI Design & Mfg, Inc v ADAC
Plastics, Inc, 165 Mich App 205, 208; 418 NW2d 386 (1987). When reviewing a grant of
summary disposition under subrule (C)(7), this Court accepts as true the plaintiff’s well-pleaded
allegations, and construes them in the light most favorable to the plaintiff. Id. at 208-209. We
consider all materials submitted in support of and in opposition to the plaintiff’s claim. Linton v
Arenac Co Rd Comm, 273 Mich App 107, 111; 729 NW2d 883 (2006). “If the pleadings
demonstrate that a party is entitled to judgment as a matter of law, or if affidavits or other
documentary evidence show that there is no genuine issue of material fact, the trial court must
render judgment without delay.” Harris v Allen Park, 193 Mich App 103, 106; 483 NW2d 434
(1992).
We review for clear error a circuit court’s decision to grant or deny a motion for change
of venue. Coleman v Gurwin, 195 Mich App 8, 10; 489 NW2d 118 (1992), rev’d on other
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grounds 443 Mich 59; 503 NW2d 435 (1993). We also review for clear error a circuit court’s
decision to impose sanctions. Schadewald v Brulé, 225 Mich App 26, 41; 570 NW2d 788
(1997). Clear error exists when some evidence supports the circuit court’s finding, but a review
of the entire record leaves this Court with the definite and firm conviction that the circuit court
made a mistake. Id.
A. Statute of Limitations
Plaintiff first contends that the circuit court erred by granting summary disposition based
on the statute of limitations, because questions of fact exist regarding when he reasonably
discovered the basis for a possible legal malpractice claim against defendant. According to
plaintiff, none of the attorneys he consulted during the years following his 1995 nolo contendere
plea offered any criticism of defendant’s conduct, and he had no reason to suspect any
negligence on defendant’s part until he met with his present counsel. Consequently, plaintiff
asserts, either the six-month discovery rule applies and permits his claim, or a jury should decide
whether he knew or should have known of a potential cause of action within six months of the
filing of this lawsuit.
The general statute of limitations applicable to plaintiff’s claim, MCL 600.5805(6),
provides that a malpractice claim must be commenced within two years of the date it accrues, or
it will be time-barred. A malpractice claim accrues on the last day of professional service,
“regardless of the time a plaintiff discovers or otherwise has knowledge of the claim.” MCL
600.5838(1). Pursuant to MCL 600.5838(2), however, a malpractice action “may be commenced
within six months after the plaintiff discovers or should have discovered the existence of the
claim if such discovery occurs after the two-year limitation period.” Fante v Stepek, 219 Mich
App 319, 322; 556 NW2d 168 (1996). If a plaintiff elects to utilize the six-month discovery
provision, “[t]he burden of proving that the plaintiff neither discovered nor should have
discovered the existence of the claim at least 6 months before the expiration of the period
otherwise applicable to the claim shall be on the plaintiff.” MCL 600.5838(2).
The elements of a legal malpractice cause of action are (1) the existence of an attorneyclient relationship, (2) negligence in the legal representation of the plaintiff, (3) proximate cause,
and (4) the fact and extent of the injury alleged. Simko v Blake, 448 Mich 648, 655; 532 NW2d
842 (1995). In Gebhardt v O’Rourke, 444 Mich 535, 537; 510 NW2d 900 (1994), the Michigan
Supreme Court examined the statute of limitations in a legal malpractice case arising from the
plaintiff’s criminal prosecution for aiding and abetting the alleged rape of her then-fiance’s
daughter. A jury convicted the plaintiff, and her counsel last represented her at the sentencing
conducted in February 1987. Id. at 537-538. The plaintiff sued her attorney in November 1989.
Id. at 538.
The Supreme Court held that the plaintiff had not timely filed her claim because “[t]he
November 3, 1989, filing of this malpractice suit occurred well beyond the two-year limitation
period. Further, Ms. Gebhardt should have discovered her malpractice claim no later than March
27, 1987, when her new attorney moved for retrial.” Gebhardt, supra at 541. The Supreme
Court explained that the six-month discovery provision did not salvage the plaintiff’s claim
because “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.” Id. at
544, citing Moll v Abbott Laboratories, 444 Mich 1; 506 NW2d 816 (1993). In Moll, the
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Supreme Court observed, “The law imposes on a plaintiff, armed with knowledge of an injury
and its cause, a duty to diligently pursue the resulting legal claim.” Id. at 29. “Once an injury
and its possible cause is known, the plaintiff is aware of a possible cause of action.” Gebhardt,
supra at 545.
Construing the instant complaint and record in the light most favorable to plaintiff, the
essence of his claim is that defendant coerced his nolo contendere plea by failing to properly
investigate the facts of the case, and by neglecting to effectively advocate on plaintiff’s behalf.
Plaintiff contends that as a result of this negligence, he lost his professional licenses and his
source of income. Because “a plaintiff’s legal malpractice claim accrues on the day that the
attorney last provides professional service in the specific matter out of which the malpractice
claim arose,” in this case the criminal proceeding that concluded with the entry of plaintiff’s plea
and an October 1995 order dismissing the remaining criminal charges against him, his
malpractice claim accrued in October 1995. Kloian v Schwartz, 272 Mich App 232, 238; 725
NW2d 671 (2006). Plaintiff thus plainly commenced this action well beyond the two-year
malpractice period of limitation, which expired by October 1997.
Regarding plaintiff’s attempt to invoke the discovery rule, undisputed facts of record
demonstrate that all elements of plaintiff’s legal malpractice claim existed within two years of
the last date that defendant represented him in matters related to the criminal prosecution. In
March 1996, the Michigan Department of Education suspended plaintiff’s teaching certificate.
Six months later, and still within two years of his plea, the Michigan Board of Psychology
suspended plaintiff’s psychology license. Thus, within the general two-year malpractice statute
of limitations period, plaintiff knew or should have known of each element of a potential legal
malpractice claim. The suspension of plaintiff’s licenses put him on notice that, contrary to the
advice allegedly provided by defendant, the nolo contendere plea did not shield him from
negative or damaging professional ramifications of his prosecution. With the suspension of his
licenses, plaintiff knew or reasonably should have known of a possible cause of action against
his counsel. Because plaintiff knew or should have known that all elements of a possible
malpractice claim against defendant existed by September 1996, at the latest, the six-month
discovery rule in MCL 600.5838(2) does not operate to extend the general malpractice period of
limitation in this case beyond October 1997, the two-year anniversary of defendant’s last
professional act on plaintiff’s behalf regarding the criminal case.
Furthermore, we reject as completely disingenuous plaintiff’s claim that he had no reason
to suspect any wrongdoing on defendant’s part until August 2006. The record reveals that
between 1999 and 2002, plaintiff filed a plethora of grievances against the attorneys involved in
his prosecution, and sought the attention of the Judicial Tenure Commission regarding the
conduct of the Berrien Circuit Court. In his affidavit, plaintiff asserts that he “maintained my
innocence since these charges were initially brought,” and “diligently, but unsuccessfully, sought
legal counsel to assist me in reversing the plea agreement.” But plaintiff’s early dissatisfaction
with the results of his plea simply cannot be denied or overlooked. We conclude that defendant
had ample incentive and opportunity during the two years after his plea to discover any missing
pieces of information necessary to prepare a claim against defendant.
We also reject plaintiff’s argument that “newly discovered evidence” of the transfer of
his criminal case from Berrien to Kalamazoo County triggered anew the running of the discovery
rule period, and thus allowed him six months from the filing of defendant’s summary disposition
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motion in which to assert the legal malpractice claim. Plaintiff’s purported unawareness of the
administrative transfer of the criminal case does not alter the facts that his cause of action
accrued when defendant completed his criminal-related service to plaintiff in October 1995, or
that plaintiff knew or should of known that he first sustained injury or damage as a result of his
nolo contendere plea well within the applicable, general two-year malpractice statute of
limitations. Objective facts existed in 1996 that should have put plaintiff on notice that he may
have received improper advice from defendant. Whether plaintiff knew about the assignment of
a Kalamazoo County Circuit Court judge simply bears no relevance to when his legal
malpractice action accrued.
Plaintiff’s attempt to utilize a fraudulent concealment argument is also unavailing. The
record contains no evidence that defendant concealed the transfer of the criminal case to
Kalamazoo County. On the contrary, that information readily appears in the Berrien County
Justice System Public Access Case Event Report of plaintiff’s 1994 prosecution. Furthermore,
neither the discovery rule nor the fraudulent concealment doctrine supplies an excuse for the 11year delay present here. The determination of when the plaintiff discovers a possible cause of
action focuses on resolving whether “a reasonable person in plaintiff's circumstances [would]
have discovered the claim.” Levinson v Trotsky, 199 Mich App 110, 112; 500 NW2d 762 (1993)
(emphasis in original). “[O]nly where the victim is not aware that he has been injured because
the damage is not discoverable by due diligence does the discovery rule apply.” Grimm v Ford
Motor Co, 157 Mich App 633, 638; 403 NW2d 482 (1986).
A plaintiff aggrieved by a lawyer’s conduct must act with reasonable diligence to obtain
legal advice and necessary supporting information, and may not simply await the fortuitous
revelation of previously unknown facts before filing a claim. Because the record reveals no
evidence that defendant fraudulently concealed any material information that plaintiff could not
otherwise easily and quickly obtain, we conclude that the circuit court correctly determined that
the statute of limitations bars plaintiff’s legal malpractice claim.
B. Venue
The proper venue for a legal malpractice action is described in MCL 600.1629(1), which
provides in relevant part as follows:
Subject to subsection (2), in an action based on tort or another legal theory
seeking damages for personal injury, property damage, or wrongful death, all of
the following apply.
(a)
The county in which the original injury occurred and in which
either of the following applies is a county in which to file and try the action:
(i)
The defendant resides, has a place of business, or conducts
business in that county.
(ii)
The corporate registered office of a defendant is located in that
county.
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In Bass v Combs, 238 Mich App 16, 21; 604 NW2d 727 (1999), this Court examined the
application of MCL 600.1629(1) in a legal malpractice action, and held that venue must be laid
in the county in which the lawyer’s alleged negligence occurred. The negligence in this case
thus occurred in the county or counties in which defendant provided legal services to plaintiff
related to the criminal prosecutions. The Cass County prosecutor’s office brought the charges in
Berrien County, and no record evidence demonstrates that defendant provided legal services to
plaintiff within Cass County, the forum in which plaintiff elected to file this case.
Plaintiff alleges that his “criminal matter was prosecuted in Cass County, not Berrien
County,” and that “[b]ecause the plea agreement was brought … in Cass County, the original
injury occurred in Cass County.” The record does not support this contention. The Berrien
County Justice System Public Access Case Event Report instead reflects to the contrary that all
proceedings in the criminal matter occurred in Berrien County, other than a single pretrial
conference that took place in Kalamazoo. Plaintiff has not claimed that defendant, whose office
is located in Berrien County, advised or counseled him in Cass County. Therefore, the circuit
court correctly concluded that plaintiff failed to meet his burden of proving that Cass County
constituted a proper venue for his claim.
The circuit court awarded defendant sanctions for plaintiff’s selection of an improper
venue on the basis of MCR 2.223(B)(1), which provides that if the court grants a motion to
change venue based on improper venue,
[t]he court shall order the change at the plaintiff’s cost, which shall include the
statutory filing fee applicable to the court to which the action is transferred, and
which may include reasonable compensation for the defendant’s expense,
including reasonable attorney fees, in attending in the wrong court.
The circuit court ruled that plaintiff selected an improper venue, but instead of transferring the
case to another county, granted defendant summary disposition pursuant to MCR 2.116(C)(7).
The circuit court awarded defendant costs of $52.98, representing a $20 motion fee and a
mileage expense of $32.98, and an attorney fee of $1,000. Defense counsel’s affidavit explains
that he calculated the attorney fee based on three hours of time spent traveling to and attending
the hearing at which the circuit court granted summary disposition, plus two hours of legal
research and preparation for the summary disposition hearing.
These costs and defense counsel’s fee did not arise entirely, or even primarily, from
defendant’s motion for change of venue, or “in attending the wrong court.” Defendant filed a
single motion, captioned “Motion for Summary Disposition in Lieu of Answer Pursuant to MCR
2.116(C)(7) and 2.111(F)(2)(a) and Alternatively for Change of Improper Venue Pursuant to
MCR 2.223,” and paid one motion fee. The hearing transcript reflects that defense counsel’s
arguments regarding the statute of limitations consumed the vast majority of the time allotted to
the hearing.
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Our review of the record thus does not support the circuit court’s decision to sanction
plaintiff for selection of an improper venue, because the court granted summary disposition at
the same hearing, and by doing so avoided any need to transfer the case.2 Because defendant did
not incur any costs specifically related to plaintiff’s choice of an improper venue, we conclude
that the circuit court clearly erred in finding sanctions warranted.
We affirm the circuit court’s grant of summary disposition to defendant under MCR
2.116(C)(7). We vacate the circuit court’s award of venue-related sanctions, and remand for
entry of a judgment for defendant that eliminates these sanctions. We do not retain jurisdiction.
/s/ Kathleen Jansen
/s/ Brian K. Zahra
/s/ Elizabeth L. Gleicher
2
The fact that the circuit court granted defendant’s motion for change of venue before granting
summary disposition does not serve as a ground to challenge the summary disposition ruling, as
MCL 600.1645 provides that “[n]o order, judgment, or decree shall be void or voidable solely on
the ground that there was improper venue.”
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