IN RE ESTATE OF LAWRENCE PAUL DOSS
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STATE OF MICHIGAN
COURT OF APPEALS
In re Estate of LAWRENCE PAUL DOSS,
Deceased.
JUDITH YOUNG DOSS,
UNPUBLISHED
February 19, 2009
Petitioner-Appellant,
v
No. 277982
Wayne Probate Court
LC No. 2001-642445-DE
LAWRY NICOLE DOSS,
Respondent-Appellee.
Before: Servitto, P.J., and Donofrio and Fort Hood, JJ.
PER CURIAM.
Petitioner, Judith Doss, appeals as of right the trial court order granting respondent’s
motion for summary disposition and denying petitioner’s cross-motion for summary disposition
in this dispute over ownership of corporate membership units. We affirm.
Decedent, Lawrence P. Doss, died intestate on October 28, 2001. He was survived by his
wife, petitioner, and two daughters (respondent being one of them) from prior marriages.
Between 1994 and 1999, decedent purchased 9 “membership units” in Atwater Entertainment
Associates, LLC (“Atwater”), a company formed in 1995 by the decedent and two other
individuals for the express purpose of pursuing the licensing, ownership, and operation of
casinos. It is undisputed that prior to his death, Doss transferred 2 of the units to petitioner. The
dispute in this matter concerns the proper title to and distribution of the remaining 7 membership
units.
While petitioner was the personal representative of decedent’s estate, the Court ordered
the transfer of the Atwater units from decedent’s name to the estate. Some time later, respondent
petitioned the court to remove petitioner as the personal representative of the estate, for an
accounting, surcharge, and the return of estate assets, alleging that the estate had received $2.8
million for the redemption of the units at issue and that petitioner had spent and/or transferred
some of the redemption monies for her personal use. Petitioner thereafter moved for a
determination of property rights in the Atwater units and the parties filed cross-motions for
summary disposition, with petitioner contending that the Atwater shares were not a part of the
estate and respondent asserting the opposite. Petitioner specifically argued that two of the seven
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units were assigned to her and the decedent as joint tenants and that decedent sold her an
additional two units. Petitioner also asserted that those four units, as well as the other three units,
were purchased with funds from her sole property or the marital home, thus making them her
separate property. The trial court disagreed, determining that decedent repeatedly attempted to
transfer the same two units to petitioner and was not successful until shortly before his death,
when two units (those not at issue) became petitioner’s property. The trial court held that there
was no question of material fact that the seven remaining Atwater units were the property of the
estate, and thus granted respondent’s motion for summary disposition. Petitioner now appeals
that decision.
Rulings on motions for summary disposition are reviewed de novo on appeal. Kreiner v
Fischer, 471 Mich 109, 129; 683 NW2d 611 (2004). Summary disposition is appropriate under
MCR 2.116(C)(10) if there is no genuine issue regarding any material fact and the moving party
is entitled to judgment as a matter of law. West v Gen Motors Corp, 469 Mich 177, 183; 665
NW2d 468 (2003). When reviewing a motion under subrule (C)(10), this Court considers the
pleadings, admissions, affidavits, and other relevant record evidence in the light most favorable
to the nonmoving party to determine whether any genuine issue of material fact exists warranting
a trial. Walsh v Taylor, 263 Mich App 618, 621; 689 NW2d 506 (2004).
On appeal, petitioner contends that the trial court erred in determining that decedent
attempted to transfer the same two membership units to petitioner on several occasions, but only
successfully transferred the two units not at issue. With respect to the transfer of ownership of
shares to petitioner, the trial court stated:
It is clear from the facts of this case that between September 1998 and January
2000 the Decedent made several attempts to complete a transaction to transfer at
least two units of ownership to the Petitioner, as his wife. For instance, on
September 29, 1998, the evidence shows that through an Assignment from Herb
Strather and his Trust to Lawrence and Judith Doss, as husband and wife, the
Decedent attempted to convey two units of ownership to his wife. This transfer
was ineffective because, at the time, the Michigan Limited Liability Corporation
Act, MCL 450.4504, did not authorize a membership interest in an LLC could be
held jointly, as husband and wife, with full rights of survivorship as entireties
property. . . The Decedent also attempted to transfer two of these units on October
1, 1998, by executing a Bill of Sale from himself to his spouse. This document
was also ineffective because according to the AEA Operating Agreement,
member approval was necessary for such a transfer. . . The Decedent finally
successfully transferred two units of ownership to the Petitioner, after the Gaming
License was granted, by submitting his Assignment of Membership interest in
Atwater Entertainment Associates, LLC on January 10, 2000. . .
While the trial court may have found that decedent only intended to transfer the two units
not at issue and the prior transfers were merely unsuccessful attempts to transfer these units, it
also found that the transfers prior to 2001 failed. We find that the trial court correctly
determined that the prior attempted transfers failed. We further find that whether decedent
intended to transfer more than the two units that were successfully transferred is immaterial,
given the express requirements of the Atwater Entertainment Associates operating agreement
concerning the transfer of membership units.
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As pointed out by petitioner, in September 1998 Atwater member Herbert Strather
transferred two membership units to decedent and petitioner. The Atwater Entertainment
Associates operating agreement, however, provides that the transfer of any membership unit
requires the approval of a majority of the Members of Atwater. Exceptions are set forth at 13.3,
which allows the transfer of units without consent if the transfer is made as a result of the death
or permanent disability of a Member, or the transfer was made in connection with the entry of a
divorce decree for or against a Member. Further exceptions are provided for at 13.5 of the
agreement:
Permitted Transfers. Notwithstanding anything to the contrary contained herein,
but subject to the provisions of Section 13.6 below, Members shall be permitted
to transfer Units without the consent of the other Members in the following
events:
A. Transfer to another Member;
B. Transfers to a corporation, partnership, limited liability company, trust
or other entity, the ownership or beneficiaries, of which are comprised wholly of
and limited to the transferee(s) and /or their legal/beneficial owners;
C. Transfers to a trust (or similar vehicle) for the benefit of the family of
the transferor;
D. Transfers to beneficiaries or devisees upon the death of the transferor;
E. Transfers as the result of the death or permanent disability of a
Member;
F. Transfers in connection with the entry of a divorce decree for or
against a Member; and
G. Transfers to the beneficial owners of entities which are Members.
None of these exceptions appears to have been present with respect to the two jointly
assigned units and petitioner does not support any argument for application of an exception. It is
undisputed that at the time of Atwater’s inception and at the time two shares were jointly
assigned, petitioner was not a Member. Absent an exception in the operating agreement, then,
approval must have been obtained from the Atwater Members to effectuate the transfer of two
units to petitioner. There is no evidence that such approval was obtained. As a result, the trial
court was correct in determining that the attempted transfer of two units of Atwater membership
to petitioner and decedent jointly in September 1998 was ineffective and provided petitioner with
no right of ownership of the shares.1
1
While the trial court determined that the transfer was ineffective because “MCL 450.4504 did
not authorize a membership interest in an LLC could be held jointly,” we will not reverse a trial
court's order where it reaches the right result for the wrong reason. Ford Credit Canada Leasing,
Ltd, v DePaul, 247 Mich App 723, 730; 637 NW2d 831 (2001).
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Petitioner also claims, alternatively, that the two jointly assigned units were held by
petitioner and decedent as tenants by the entireties such that the two units became her sole
property upon decedent’s death. It is true that a “husband and wife shall be equally entitled to
the rents, products, income, or profits, and to the control and management of real or personal
property held by them as tenants by the entirety.” MCL 557.71. Petitioner is also correct that a
membership interest is personal property. MCL 450.4504. Petitioner then, however, makes the
leap that because the interest was the personal property of decedent, it was necessarily held by
both her and decedent as tenants by the entirety. Petitioner has not, however, provided any
support for such a position; instead she has only provided authority (and only a cursory analysis)
suggesting that personal property could be held as tenants by the entirety. We will not elaborate
a party’s arguments or search for authority either to sustain or reject his position. See, Wilson v
Taylor, 457 Mich 232, 243; 577 NW2d 100 (1998). Moreover, even if membership units in a
corporation may be held as tenants by the entireties, the Atwater operating agreement
specifically provides that transfers of ownership units to non-members requires the approval of
all of the other members except under very specific circumstances—circumstances which were
not present with respect to the September 1998 joint assignment of the two units.
In October 1998, decedent executed a bill of sale purporting to transfer two units to
petitioner. According to petitioner, the two units could be assigned to her without Member
approval under the exceptions in the Atwater operating agreement allowing for transfers of
membership units “to beneficiaries or devisees upon the death of the transferor” and “transfers as
the result of the death or permanent disability of a Member.” However, the units petitioner
references are those purportedly transferred to her through the October 1998 bill of sale.
Obviously, this transfer did not take place due to or because of decedent’s death, he having lived
for several years after signing the bill of sale. Petitioner apparently encourages us to find the bill
of sale not effective as of the date of signing, but effective only as of the date of decedent’s
death. She has, however, provided no rationale for construing the bill of sale in such a manner.
The bill of sale itself contains no language suggesting an intention other than to have immediate
effect. The transfer not falling within any exception in the Atwater operating agreement,
Member approval was required for transfers of the units unless, among other things, the transfer
was to another Member. Petitioner having not become a Member until (by her own estimation)
2002 when two units were successfully transferred to her, Member approval was necessary for
the 1998 bill of sale. There is no assertion that approval was sought or obtained. As such the
transfer is, according to the AEA Operating Agreement void ab initio and of no effect. The trial
court did not err in finding that the October 1998 bill of sale failed to effectively transfer two
membership units to petitioner.
Petitioner next argues that the trial court erred in determining that petitioner had no legal
lien on the seven units at issue when mortgages on and sales proceeds from her properties were
used to directly purchase the Atwater units in decedent’s name. We disagree.
In support of her position that the seven units were estate assets and petitioner always
recognized the units as such, respondent submitted, among other things, estate inventories,
accounts, and tax returns. The inventories, signed by petitioner as personal representative of the
estate, listed membership units as an estate asset, as did the estate accountings and tax returns.
Correspondences from Atwater, addressed to petitioner, also establish that the seven units were
estate assets. For example, a November 7, 2001 letter from Atwater, signed by Vivian
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Carpenter, and addressed to petitioner states that Carpenter is enclosing a copy of petitioner’s
transfer documents as approved by the Michigan Gaming Control Board [of the 2 units not at
issue]. According to the letter, “the remaining seven units are left in the Estate of Lawrence
Doss.” Atwater’s corporate documents, including an April 27, 2005 “Rights Certificate” issued
by Atwater and listing the estate of Lawrence P. Doss as the owner of seven units, also reflect
that decedent, and then his estate, was the owner of the seven units.
Documents filed with the court throughout the dispute in this matter also indicate that the
units were estate assets. On April 13, 2004 Petitioner signed a sworn “petition to authorize
transfer of assets to estate” stating that the estate is the presumptive owner of seven units of
membership in Atwater, and that the entities holding title to the asset would not transfer title to
the estate without a court order. From this document, it appears that petitioner acknowledged the
seven membership units as belonging to the decedent, and expressed an intent to transfer title of
the units to the estate—not to her personally. An order authorizing the transfer of assets was
entered August 30, 2004. The order provides that those entities holding title to the 7 membership
units, “which originally belonged to Lawrence Paul Doss, shall forthwith transfer title to Judith
Young-Doss, Personal Representative of the Estate of Lawrence Paul Doss, Deceased.” The
order, recognizing decedent as the owner of the units, was entered without objection.
Petitioner contends that the trial court could not properly rely upon the cited documents
in granting respondent’s motion for summary disposition, and is correct that an inventory made
by an administrator is not conclusive as to the assets of the estate or their value. See, e.g.,
Peckham v Hoag, 57 Mich 289, 291; 23 NW 818 (1885). However, it having been established
that only two units of membership were, in fact, actually transferred to petitioner, there is no
reason articulated by petitioner why these documents cannot be viewed as evidence on the issue
of whether she always believed the remaining seven units to be hers and always acted in
conformity with that belief. These documents are not alleged to be inadmissible and petitioner’s
subjective belief that they are irrelevant is not controlling. It appears, too, that some of the
documents petitioner now deems irrelevant were attached as exhibits to her summary disposition
pleadings, and those documents that she signed and submitted in court proceedings are properly
considered by the court.
Respondent having come forward with admissible evidence to support her position, it is
incumbent upon petitioner to, by documentary evidence, set forth specific facts showing that
there is a genuine issue for trial. Coblentz v City of Novi, 475 Mich 558, 568-569; 719 NW2d 73
(2006). Petitioner produced several documents for the trial court’s review, including: her
affidavit, a timeline purportedly establishing that decedent’s Atwater units were financed through
mortgages and sales proceeds from her properties, deeds concerning certain real properties, and
amended inventories of decedent’s estate indicating that she claimed a lien on the Atwater units.
We agree with the trial court that the evidence submitted by petitioner was insufficient to create a
triable issue as to whether the seven membership units were estate property.
The trial court discounted petitioner’s affidavit, finding that it contradicted the prior
statements petitioner had submitted in the sworn estate inventories, accountings, and tax returns.
Despite petitioner’s contention that the affidavit was merely explanatory, we find no error in the
trial court’s conclusion. A party or witness may not create a factual dispute by submitting an
affidavit that contradicts his own sworn testimony or prior conduct. Casey v Auto-Owners Ins
Co, 273 Mich App 388, 396; 729 NW2d 277 (2006); Bergen v Baker, 264 Mich App 376, 389;
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691 NW2d 770 (2004); Progressive Timberlands, Inc v R & R Heavy Haulers, Inc, 243 Mich
App 404, 411; 622 NW2d 533 (2000). Here, petitioner’s affidavit that she always believed the
remaining seven units to be her personal property and always acted in conformity therewith
could be construed as contradicting her prior conduct in listing the units as an estate asset on
estate inventories and tax returns, seeking to have the units transferred from decedent to the
estate, rather then claiming them as a personal asset, and failing to object to court documents
indicating that the units belonged to decedent.
Likewise plaintiff’s self-serving affidavit concerning the monies used to acquire the units
and the remaining evidence she relies on, primarily a timeline and its supporting documents,
serve as no concrete evidence that the mortgages and property sales were used to finance the
purchase of Atwater units. The timeline shows, for example, (and supporting documents
confirm) that decedent purchased .1 units in 1994 (no specific date) for $2500 and .4 units on
July 29, 1994 for $10,000. Petitioner’s time line shows a mortgage on her home in the amount
of $45,000 taken out on October 7, 1994—after the first partial unit was purchased and for an
amount far more than the purchase price. The line also shows that decedent purchased 2 units
on May 31, 1995 for the price of $5.00. The timeline shows a mortgage on her separate property
for $157,000 taken out on June 19, 1995—again, after the 2 units were purchased and for an
amount hugely exceeding the units’ purchase price. The timeline next shows a mortgage taken
out on the marital home on January 31, 1996 for $300,000 and the purchase of .1 unit by
decedent on November 21, 1996 for the price of $2500.00. Again, the disparity in price of units
and amount of mortgage, along with the time gap, does not sufficiently establish that the
mortgage monies were used to finance the purchase of Atwater units. The next event shown on
the timeline is the sale of petitioner’s sole property for the price of $72,000, followed on
November 10, 1997 of the purchase of 2.4 units for $6. At this point, decedent has purchased 5
units in Atwater for a total purchase price of $15,011. Mortgages and sales proceeds petitioner
claims were used to finance the purchase of these units totaled $574,500.00. There is no
documentation to show that any of the sale/mortgage proceeds were paid directly to Atwater,
(i.e. a check written from mortgage company to Atwater) and no bank records were produced to
link the payments. Petitioner’s attorney, when questioned in the presence of petitioner whether a
paper trail corroborating the time line and further demonstrating how the money petitioner
received from the mortgages and sales was used could be produced, admitted he could not
produce any such evidence. As such, petitioner’s claim that the sale and mortgages or her
personal properties financed the purchases of the units appears to be speculative at best and is
insufficient to create a genuine issue of material fact concerning whether petitioner has a legal
claim to the seven units.
Petitioner also claims as error the trial court’s holding that the estate would not be
unjustly enriched were it to retain title to the units. Unjust enrichment is the “(1) receipt of a
benefit by the defendant from the plaintiff and (2) an inequity resulting to the plaintiff because of
the retention of the benefit by the defendant.” Barber v SMH (US), Inc, 202 Mich App 366, 375;
509 NW2d 791 (1993). Because we previously determined that the units properly belonged to
the estate, the estate received no benefit from petitioner. Unjust enrichment is thus inapplicable.
Because of our prior determinations that decedent did not transfer any of the seven units
to petitioner and that the evidence petitioner provided to support her position that the mortgage
and sale proceeds from her personal properties financed the purchase of and were intended to be
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secured by the disputed units was speculative, we need not address petitioner’s remaining issues
on appeal.
Affirmed.
/s/ Deborah A. Servitto
/s/ Pat M. Donofrio
/s/ Karen M. Fort Hood
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