WALLY YOOST V PATRICIA E CASPARI (Per Curiam Opinion)
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Court of Appeals, State of Michigan
ORDER
Donald S. Owens
Wally Yoost v Patricia E Caspari
Presiding Judge
Docket No.
294299
Jane E. Markey
LC No.
2008-000135 -CZ
Patrick M. Meter
Judges
The Court orders that the motion for reconsideration is GRANTED, and this Court's
opinion issued September 15, 20 11 is hereby VACATED. A new opinion is attached to thi s order.
A true copy entered and certified by Larry S. Royster, Chief Clerk, on
JAN 17 2012
Date
STATE OF MICHIGAN
COURT OF APPEALS
WALLY YOOST,
FOR PUBLICATION
January 17, 2012
9:00 a.m.
Plaintiff/Counter-Defendant,
v
PATRICIA E. CASPARI and ELLEN FRANKLE
Personal Representative of the ESTATE of
LAWRENCE I. FRANKLE,
No. 294299
Berrien Circuit Court
LC No. 2008-000135-CZ
and
IRWIN C. ZALCBERG,
Defendant/Counter-PlaintiffAppellee
v
HANK ASHER a/k/a HENRY ASHER,
Counter-Defendant-Appellant.
Before: OWENS, P.J., and MARKEY and METER, JJ.
PER CURIAM.
Counter-defendant Hank Asher appeals by leave granted the trial court’s order denying
his motion for summary disposition under MCR 2.116(C)(1). He asserts that the trial court erred
by ruling it had limited jurisdiction over him under Michigan’s long-arm statute, MCL
600.705(2), on the basis that counter-plaintiff Irwin C. Zalcberg made a prima facie showing that
Asher conspired with plaintiff Wally Yoost to commit the tort of abuse of process in Michigan.
We reverse and remand for entry of an order granting Asher summary disposition.
I. SUMMARY OF FACTS AND PROCEEDINGS
Plaintiff Wally Yoost and Hank Asher are both citizens and residents of Florida.
Defendants Irwin Zalcberg, Patricia Caspari, and Ellen Frankle are all residents of Michigan.
Zalcberg is sole shareholder and officer of Zalcberg Holdings, Inc, an Illinois corporation; he is
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in the business of trading equities and options from his home. Zalcberg employed Yoost from
the fall of 1999 until early 2005. Yoost contends he worked as a trader and also provided estate
management services for Zalcberg’s wife, Sari. Zalcberg describes Yoost’s employment as that
of personal trainer, intern, and personal assistant. During Yoost’s employment, Yoost met
Patricia Caspari and the two became romantically involved and began living together in 2001, in
Michigan Shores, Indiana. Caspari often visited Yoost at Zalcberg’s residence, becoming
acquainted with Zalcberg. Yoost also became acquainted with Lawrence Frankle, Zalcberg’s
personal friend, business partner, and legal counsel. Yoost claims he often sought legal advice
from Frankle.
In 2002, Zalcberg and Sari loaned Yoost $67,000, secured by a note and mortgage
executed October 29, 2002, to purchase a house on Fogarty Street in Michigan City, Indiana.
Also on October 29, 2002, Caspari quitclaimed any interest in the Fogarty property to Yoost.
Yoost asserts Frankle drafted the quitclaim deed as a means of protecting his interest in the
property while cohabitating with Caspari. Yoost and Caspari subsequently resided in the house
on Fogarty Street and began making improvements.
Yoost alleges that in 2003 he informed Zalcberg that he was dissatisfied with his
employment. Yoost asserts Zalcberg enticed his continued employment by releasing him from
any further obligations on the Fogarty property note and mortgage. Yoost continued working for
Zalcberg and stopped making payments on the note and mortgage.
In 2004, Yoost and Caspari moved to Galien, Michigan, where they lived together. They
rented out the Fogarty property. Yoost worked for Zalcberg until March 2005. Zalcberg filed
for divorce from Sari, who was suffering from terminal cancer, in March 2005; the divorce was
final on March 28, 2006. Zalcberg contends that, Asher, his former brother-in-law, has harbored
ill will against him since he filed for divorce from Sari. Yoost’s and Caspari’s relationship also
ended in December 2005. Yoost subsequently moved to Florida and worked for Asher. In
August 2006, Zalcberg began foreclosure proceedings on the Fogarty property in Indiana. Yoost
defended the foreclosure action by asserting his claim that Zalcberg had forgiven the debt. Yoost
also asserted other defenses, including that Zalcberg had failed to fulfill his oral promise to share
certain trading profits with Yoost. See Yoost v Zalcberg, 925 NE2d 763 (Ind App, 2010). Yoost
also attempted to assert a claim for trading profits in a suit for an accounting filed in Illinois
against Zalcberg Holdings, but the case was dismissed shortly after the instant case was initiated
on the basis of forum non conveniens because the claim for profits concerned conduct occurring
in Michigan and Indiana that could be joined to the already pending litigation in Indiana to which
Zalcberg, the sole share holder of Zalcberg Holdings, was a party.
Yoost filed the instant lawsuit against Caspari on April 8, 2008, alleging that she
attempted to extort a 50% interest in the Fogarty property by threatening to report Yoost to the
IRS for not paying taxes on his income while working for Zalcberg. The complaint also alleged
intentional infliction of emotional distress. After numerous emails between Caspari and
Zalcberg were discovered that suggested Zalcberg and Frankle encouraged Caspari’s actions,
Yoost was permitted to file an amended complaint adding Zalcberg and Frankle as defendants.
By stipulation of the parties, Yoost filed a second amended complaint that substituted Ellen
Frankle as personal representative of the estate of Lawrence.
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On January 28, 2009, Zalcberg filed a counterclaim in this case against Yoost and Asher
alleging abuse of process and conspiracy to commit abuse of process. Zalcberg’s counterclaim
alleged, in part, that “Yoost and Asher agreed to join together in the concerted actions of Asher
paying for and, on information and belief, directing a series of false and fraudulent legal claims
filed in Yoost’s name and against Zalcberg in the Indiana litigation for ulterior purposes . . .
including punishing, humiliating and embarrassing Zalcberg, extorting from him large sums of
business profits,” and interfering with “a proper mortgage foreclosure action.” Zalcberg also
alleged Asher and Yoost filed other lawsuits in Yoost’s name in Illinois and Michigan for similar
purposes, and to intimidate witnesses favorable to Zalcberg, and obtain discovery unavailable in
Indiana. In this case, Zalcberg alleges that “Asher and Yoost, in Yoost’s name,” assert “false
and fabricated claims and seek[] grossly overreaching and irrelevant discovery.” With respect to
discovery in the instant case, Zalcberg alleges that the trial court “denied [Yoost’s] request to
hold Zalcberg in contempt and entered a protective order denying the request for production of
Zalcberg’s trading and other business records.” Zalcberg alleged the abuse of process caused
him “financial losses, loss of business opportunities, and the expense of defending against
fraudulent claims and abusive discovery.” Last, the counterclaim alleges that the actions of
Asher and Yoost amounted to a civil conspiracy resulting in the damages just described.
On May 29, 2009, Asher moved for summary disposition of Zalcberg’s counterclaim
pursuant to MCR 2.116(C)(1), asserting that the circuit court lacked personal jurisdiction over
him because he was a resident of Florida and had neither engaged in any business in Michigan
nor had any qualifying contacts with the state. Asher argued the trial court could not exercise
limited personal jurisdiction over him under Michigan’s long-arm statute, MCL 600.705. Asher
also argued that Michigan exercising jurisdiction over him would violate due process.
In support of his motion, Asher appended his own affidavit, which averred that he was a
Florida resident, had not transacted any business in Michigan, and denied having “done or
caused an act to be done, or caused consequences to occur in Michigan, resulting in an action for
tort.” Asher acknowledged he had employed Yoost since 2006, that he knew of litigation
between Yoost and Zalcberg, and that he had “advanced money to Yoost’s counsel” in Illinois
and Indiana. However, Asher averred that he had “not caused litigation in Yoost’s name to be
brought or consequences to occur in any state against Irwin Zalcberg,” and that he had “not
involved myself in the decisions that Yoost and his lawyers have made with regard to how to
proceed in any of the litigation between Yoost, Irwin Zalcberg, and the others.” Asher further
averred that he “did not execute a letter of retention with Yoost’s attorneys in any state,” and
with respect to Yoost’s legal fees, “Yoost’s lawyers in Illinois and Indiana send work invoices to
my staff in Florida for payment.”
Zalcberg filed a response opposing the motion and submitted excerpts of Yoost’s
testimony from depositions in the Indiana litigation. Zalcberg also contended that Asher’s
affidavit failed to comply with MCR 2.119 because it did not show affirmatively that Asher, if
sworn as a witness, could testify competently to the facts stated in the affidavit. The circuit court
denied the motion. The court found that it lacked general jurisdiction over Asher and rejected
the argument that it had limited jurisdiction under MCL 600.705(1) for the “transaction of any
business within the state.” But the trial court ruled that it had limited jurisdiction under MCL
600.705(2): “The doing or causing an act to be done, or consequences to occur, in the state
resulting in an action for tort.” The court explained:
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[I]f the allegations in the complaint are true, there is no doubt that Asher
caused an act to be done and consequences to occur in Michigan resulting in an
action in tort, if those allegations are true that he is using this law suit for ulterior
motives.
Here there is some documentary evidence . . . to support the position of
Zalcberg that the motion should not be granted. And that’s the deposition
testimony of Yoost regarding Asher’s payment of legal fees under what I might
describe as curious circumstances and . . . Yoost’s lack of recall as to whether he
even read the complaint that was filed in this case. And I believe that . . . this
testimony, as well as the testimony of Yoost, that he did discuss the details of the
Indiana case with Asher could support an inference that Yoost in this case is the
puppet and Asher is the puppeteer.
***
Moreover, with regard to the affidavit that Asher filed, and while I’m
finding that even in the face of that affidavit there would be sufficient evidence in
this case to deny the motion based on what I had previously said, I also find that
the affidavit is defective. . . . [MCR] 2.119(B) governs the form of the affidavit.
And it must affirmatively show that if sworn as a witness . . . the affiant can
competently testify to the facts set forth, and it also . . . has to be made on
personal knowledge. And it does not aver that and it does not aver that he can
confidently [sic] testify to the facts set forth therein. So I think technically it’s
deficient. But even if it weren’t I would deny the motion on the basis of what I
have previously said.
As far as the due process . . . is concerned, the allegation and the factual
support inferences drawn there from are sufficient to invoke the Michigan long
arm statute as I have previously ruled for limited personal jurisdiction and also it
would overcome any due process arguments. . . .
In rendering its ruling, the trial court specifically noted that it was without prejudice
because “something might happen in the future that changes my ruling.” Thereafter, Asher filed
a renewed motion for summary disposition pursuant to MCR 2.116(C)(1), again arguing that the
court lacked personal jurisdiction over him. Asher also asserted that Zalcberg had not stated a
claim for abuse of process, MCR 2.116(C)(8). In support, Asher provided the court with a new
affidavit that satisfied MCR 2.119(B) and contained all the same averments of the first affidavit.
In addition, Asher also denied that he caused or did anything resulting in a tort in Michigan, and
specifically, that he did not do “the acts I am alleged to have done that gave rise to this lawsuit.”
Specifically, Asher denied that he “caused or induced [Yoost] to sue anyone in Michigan. I did
not cause this lawsuit to be filed.”
Asher also submitted an affidavit from Yoost, which stated that Yoost “voluntarily
brought the causes of action against Zalcberg and Caspari,” and that “Asher did not tell me to
start this lawsuit, and did not tell me to add Zalcberg as a defendant.” Yoost admitted Asher
“advanced money to pay my legal expenses in this litigation.” Regarding his deposition
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testimony concerning reviewing the complaint he filed, Yoost stated that a recent review of the
complaint and amended complaint in this case had refreshed his memory and averred that “I
reviewed both the Complaint and Amended Complaint before they were filed in this case.”
The trial court characterized Asher’s renewed motion as being one for reconsideration,
and denied the motion, explaining “it merely rehashes what I ruled on before.” As for Yoost’s
affidavit, the trial court considered it an impermissible attempt to contradict his deposition
testimony. The trial court also denied Asher’s motion for summary disposition under MCR
2.116(C)(8), ruling that Zalcberg had alleged a claim of abuse of process that was supported by
“one act alleged in the furtherance of . . . [the] ulterior motive . . . the discovery process.”
On November 6, 2009, this Court granted Asher’s application for leave to appeal limited
to the issues raised in the application, which were whether the trial court erred in ruling it had
limited personal jurisdiction over Asher under Michigan’s long-arm statute, and if so, whether
the requirements of due process were satisfied. This Court also granted Asher’s motion for stay
of discovery pending resolution of this appeal.
II. STANDARD OF REVIEW
This Court reviews de novo a trial judge’s decision on a motion for summary disposition.
Dalley v Dykema Gossett, 287 Mich App 296, 304; 788 NW2d 679 (2010). The legal question
whether a court possesses personal jurisdiction over a party is also reviewed de novo. W H Froh,
Inc v Domanski, 252 Mich App 220, 225; 651 NW2d 470 (2002). The jurisdictional question
here also presents the legal question whether the exercise of personal jurisdiction over
nonresident Asher is consistent with notions of fair play and substantial justice required by the
Due Process Clause of the Fourteenth Amendment, which we likewise review de novo. Jeffrey v
Rapid American Corp, 448 Mich 178, 184-186; 529 NW2d 644 (1995).
The parties disagree regarding the standard of review applicable to Asher’s renewed
motion for summary disposition. Zalcberg notes that the trial court properly treated the renewed
motion as one for reconsideration that is reviewed for an abuse of discretion. Woods v SLB
Property Mgt LLC, 277 Mich App 622, 629; 750 NW2d 228 (2008). “An abuse of discretion
occurs when the decision results in an outcome falling outside the principled range of outcomes.”
Woodard v Custer, 476 Mich 545, 557; 719 NW2d 842 (2006). But Asher argues that because
the court’s jurisdiction is at issue, we must review the renewed motion de novo. Jeffrey, 448
Mich at 184. We agree that our review of the trial court’s ultimate determination that it
possessed limited personal jurisdiction over Asher is de novo.
Ordinarily, on a motion for reconsideration, a trial court has discretion to decline to
consider new legal theories or evidence that could have been presented when the motion was
initially decided. MCR 2.119(F)(3); Woods, 277 Mich App 629-630. But the trial court also has
the discretion to give a litigant a “second chance” even if the motion for reconsideration presents
nothing new. Hill v City of Warren, 276 Mich App 299, 306-307; 740 NW2d 706 (2007); In re
Moukalled Estate, 269 Mich App 708, 714; 714 NW2d 400 (2006). Here, the trial court initially
found that Asher’s affidavit was defective, but even if not, the court would still rule it had
limited personal jurisdiction. At the renewed motion, the trial court again ruled that Asher’s
corrected affidavit was insufficient because Asher “merely rehashes what I ruled on before.”
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Likewise, the trial court considered but rejected Yoost’s affidavit, not because it was untimely,
but also because the court determined that its substance merely attempted to contradict Yoost’s
deposition testimony. Because the trial court considered the affidavits in making its ruling, we
include them in our de novo review of the trial court’s ultimate determination that it possessed
limited personal jurisdiction over Asher.
Moreover, the question presented is jurisdictional and of constitutional magnitude. “[A]
court is continually obliged to question sua sponte its own jurisdiction over a person, the subject
matter of an action, or the limits of the relief it may afford . . . .” Yee v Shiawassee Co Bd of
Comm’rs, 251 Mich App 379, 399; 651 NW2d 756 (2002). “Before a court may obligate a party
to comply with its orders, the court must have in personam jurisdiction over the party.” Oberlies
v Searchmont Resort, Inc, 246 Mich App 424, 427; 633 NW2d 408 (2001). In light of the
importance of the issue, to the extent the trial court failed to consider the affidavits of Asher and
Yoost in rendering its jurisdictional ruling, MCR 2.116(G)(5), and even if filed with a motion for
reconsideration, we would conclude the trial court abused its discretion.
III. ANALYSIS
When reviewing a trial court’s decision on a motion for summary disposition brought
under MCR 2.116(C)(1), the trial court and this Court consider the pleadings and documentary
evidence submitted by the parties in a light most favorable to the nonmoving party. MCR
2.116(G)(5); Oberlies, 246 Mich App at 427. “The plaintiff bears the burden of establishing
jurisdiction over the defendant, but need only make a prima facie showing of jurisdiction to
defeat a motion for summary disposition.” Jeffrey, 448 Mich at 184. The plaintiff’s complaint
must be accepted as true unless specifically contradicted by affidavits or other evidence the
parties submit. Patterson v Kleiman, 447 Mich 429, 434 n 6; 526 NW2d 879 (1994). Thus,
where allegations in the pleadings are contradicted by documentary evidence, the plaintiff may
not rest on mere allegations but must produce admissible evidence of his prima facie case
establishing jurisdiction. MCR 2.116(G)(6); Mozdy v Lopez, 197 Mich App 356, 361; 494
NW2d 866 (1992). This protocol for reviewing the jurisdictional issues presented here are
summarized well in Williams v Bowman Livestock Equipment Co, 927 F.2d 1128, 1130-1131
(CA 10, 1991)1, quoting Behagen v Amateur Basketball Ass’n, 744 F.2d 731, 733 (CA 10, 1984):
“The plaintiff bears the burden of establishing personal jurisdiction over the
defendant. Prior to trial, however, when a motion to dismiss for lack of
jurisdiction is decided on the basis of affidavits and other written materials, the
plaintiff need only make a prima facie showing. The allegations in the complaint
must be taken as true to the extent they are uncontroverted by the defendant’s
affidavits. If the parties present conflicting affidavits, all factual disputes are
resolved in the plaintiff’s favor, and the plaintiff’s prima facie showing is
sufficient notwithstanding the contrary presentation by the moving party.”
1
Williams and Mozdy are both cited by our Supreme Court in Jeffrey, 448 Mich at 184, when
discussing the appropriate standard of review of jurisdictional issues.
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When examining whether a Michigan court may exercise limited personal jurisdiction
over a defendant, this Court employs a two-step analysis. Jeffrey, 448 Mich at 184-185;
Domanski, 252 Mich App at 225. “First, this Court ascertains whether jurisdiction is authorized
by Michigan’s long-arm statute. Second, this Court determines if the exercise of jurisdiction is
consistent with the requirements of the Due Process Clause of the Fourteenth Amendment.”
Electrolines, Inc v Prudential Assurance Co, 260 Mich App 144, 167; 677 NW2d 874 (2003).
Both prongs of this analysis must be satisfied for a Michigan court to properly exercise limited
personal jurisdiction over a nonresident. Green v Wilson, 455 Mich 342, 351 (KELLY, J.), 361
(MALLETT, C.J.); 565 NW2d 813 (1997). “Long-arm statutes establish the nature, character, and
types of contacts that must exist for purposes of exercising personal jurisdiction. Due process,
on the other hand, restricts permissible long-arm jurisdiction by defining the quality of contacts
necessary to justify personal jurisdiction under the constitution.” Id. at 348. This Court, in
Mozdy, 197 Mich App at 359, stated the three-part test for determining if exercising limited
personal jurisdiction comports with due process:
First, the defendant must have purposefully availed himself of the privilege of
conducting activities in Michigan, thus invoking the benefits and protections of
this state’s laws. Second, the cause of action must arise from the defendant’s
activities in the state. Third, the defendant’s activities must be substantially
connected with Michigan to make the exercise of jurisdiction over the defendant
reasonable.
In the present case, we need not consider whether the exercise of limited personal
jurisdiction over Asher comports with due process because we conclude that Zalcberg failed to
establish a prima facie case against Asher that satisfied MCL 600.705. Consequently, the trial
court erred by not granting Asher’s motion for summary disposition under MCR 2.116(C)(1).
The trial court determined that it had limited personal jurisdiction over Asher under MCL
600.705(2), which provides:
The existence of any of the following relationships between an individual or his
agent and the state shall constitute a sufficient basis of jurisdiction to enable a
court of record of this state to exercise limited personal jurisdiction over the
individual and to enable the court to render personal judgments against the
individual or his representative arising out of an act which creates any of the
following relationships:
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(2) The doing or causing an act to be done, or consequences to occur, in the state
resulting in an action for tort.
The trial court’s ruling that Zalcberg’s counterclaim satisfied § 705(2) was based on two
premises: (1) Zalcberg’s counterclaim alleged a prima facie case that Yoost committed the tort
of abuse of process in Michigan, and (2) there was evidence to support an inference that Asher
controlled this litigation through Yoost, in the trial court’s words, that “Yoost in this case is the
puppet and Asher is the puppeteer.” Our de novo review of the pleadings and evidence
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submitted by the parties convinces us that Zalcberg failed to establish a prima facie case that
Asher committed the tort of abuse of process in Michigan. Moreover, Zalcberg failed to present
evidence to establish a prima facie case that Asher directed, controlled or conspired with Yoost
regarding this litigation or its conduct.
A. CONSPIRACY AND CAUSATION
Zalcberg failed to establish a prima facie case that Asher conspired with Yoost to do so,
or otherwise caused “an act to be done, or consequences to occur,” in Michigan resulting in an
action for tort.2 MCL 600.705(2).
Under the “conspiracy theory” of jurisdiction, a conspirator not within the forum state
may nevertheless be subject to the jurisdiction of the forum state based on the acts a
coconspirator committed there. Chrysler Corp v Fedders Corp, 643 F2d 1229, 1236 (CA 6,
1981). The rationale for this rule is that where one member of a conspiracy “inflicts an
actionable wrong in one jurisdiction, the other member should not be allowed to escape being
sued there by hiding in another jurisdiction.” Stauffacher v Bennett, 969 F2d 455, 459 (CA 7,
1992). But mere allegations that a conspiracy exists between the defendant and another over
whom the court has jurisdiction is insufficient. Id. at 460; Chrysler Corp, 643 F2d at 1236-1237.
Rather, evidence or facts must support the allegations of conspiracy. Id.; Ecclesiastical Order of
the Ism of Am, Inc v Chasin, 845 F.2d 113, 116 (CA 6, 1988); Coronet Dev Co v FSW, Inc, 3
Mich App 364, 369; 142 NW2d 499 (1966).
In this case, Asher in his affidavits denied Zalcberg’s allegations of conspiring with
Yoost and also denied directing this litigation. Yoost also averred that he “voluntarily brought
the causes of action against Zalcberg and Caspari,” and that “Asher did not tell me to start this
lawsuit, and did not tell me to add Zalcberg as a defendant.”3 Because Zalcberg’s allegations
that Asher conspired with Yoost or directed this lawsuit were contradicted with evidence,
Zalcberg was required to produce evidence to establish a prima facie case that Asher, in fact,
conspired with Yoost or otherwise directed this litigation in order to meet his burden of
establishing limited personal jurisdiction under § 705(2). Jeffrey, 448 Mich at 184; Patterson,
447 Mich at 434 n 6.
A “prima facie case” is defined in Black’s Law Dictionary (5th ed) as “‘one that will
entitle a party to recover if no evidence to contrary is offered by opposite party.’” Dep’t of
Environmental Quality v Worth Twp, 289 Mich App 414, 419; ___ NW2d ___ (2010).
Similarly, our Supreme Court has defined a prima facie case as “‘[a] case made out by proper
2
We note there is no civil action for conspiracy alone; there must be an underlying actionable
tort. Earp v Detroit, 16 Mich App 271, 275; 167 NW2d 841 (1969).
3
Even if one paragraph of Yoost’s affidavit attempted to contradict his deposition testimony, the
remaining parts of the affidavit are not thereby invalidated. Further, remembering a fact at a
later time does not contradict earlier lack of recall. It may, however, affect credibility.
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and sufficient testimony; one which is established by sufficient evidence, and can be overthrown
only by rebutting evidence adduced on the other side[.]’” People v Licavoli, 264 Mich 643, 653;
250 NW2d 520 (1933) (citations omitted). “Prima facie evidence” is defined as “‘[e]vidence
good and sufficient on its face . . . to establish a given fact, or the group or chain of facts
constituting the party’s claim or defense, and which if not rebutted or contradicted, will remain
sufficient.’” Worth Twp, 289 Mich App at 419, quoting Black’s Law Dictionary (5th ed).
Here, while Asher and Yoost submitted affidavits contradicting Zalcberg’s claims
regarding Asher’s directing this litigation, on Asher’s motion for summary disposition under
MCR 2.116(C)(1), factual disputes must be resolved in Zalcberg’s favor, Jeffrey, 448 Mich at
184. Zalcberg need only present evidence sufficient to establish prima facie his jurisdictional
claims “notwithstanding the contrary presentation by the moving party.” Williams, 927 F2d at
1131. A party may establish a case with circumstantial evidence. Karbel v Comerica Bank, 247
Mich App 90, 97; 635 NW2d 69 (2001). And, a prima facie case may be established using
reasonable inferences, provided sufficient evidence is introduced to take the inferences out of the
realm of conjecture. Berryman v K Mart Corp, 193 Mich App 88, 92; 483 NW2d 642 (1992).
The trial court found a prima facie case for Zalcberg’s jurisdictional claims based on
Yoost’s testimony in depositions taken as part of the Indiana litigation that provided evidence of
three facts: (1) Asher paid Yoost’s legal fees under “curious circumstances;” (2) Yoost did not
recall reading the complaint filed in this case during his deposition, and (3) Yoost at some point
discussed the details of the Indiana case with Asher. These three facts either individually or
combined do not provide a logical chain of inference to the conclusion that Asher in fact
conspired with Yoost or otherwise directed this litigation. That Asher paid Yoost’s legal fees
does not establish that Asher exercised control over Yoost regarding this litigation. Asher could
have done so because he liked and wanted to help Yoost or because he disliked Zalcberg. But
the mere fact that Asher paid Yoost’s litigation expenses does not logically lead to the
conclusion that Asher controlled Yoost or the instant litigation. Yoost’s poor memory or failure
to read the complaint in this case, even viewed in the light most favorable to Zalcberg, does not
bridge the gap to the jurisdictionally required showing that Asher controlled Yoost and through
him this litigation. The fact that Yoost discussed the Indiana litigation with Asher provides even
less assistance to infer that Asher controlled this litigation through Yoost. Moreover, under
Michigan’s rules of professional conduct, Yoost’s attorneys could not ethically permit Asher to
control Yoost’s litigation. MRPC 1.8(f) provides:
A lawyer shall not accept compensation for representing a client from one other
than the client unless: (1) the client consents after consultation; (2) there is no
interference with the lawyer's independence of professional judgment or with the
client-lawyer relationship; and (3) information relating to representation of a
client is protected . . . .”
In short, a gap that can only be filled with speculation exists between the three facts that
the trial court relied on to reach the conclusion that Asher controlled this litigation through
Yoost, which is necessary obtain limited personal jurisdiction over Asher. “To be adequate, a
plaintiff's circumstantial proof must facilitate reasonable inferences . . . not mere speculation.”
Skinner v Square D Co, 445 Mich 153, 164; 516 NW2d 475 (1994). Explaining the difference
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between reasonable inference and speculation and conjecture, the Skinner Court quoted Kaminski
v Grand Trunk W R Co, 347 Mich 417, 422; 79 NW2d 899 (1956):
“[A] conjecture is simply an explanation consistent with known facts or
conditions, but not deducible from them as a reasonable inference. There may be
2 or more plausible explanations as to how an event happened or what produced
it; yet, if the evidence is without selective application to any 1 of them, they
remain conjectures only. On the other hand, if there is evidence which points to
any 1 theory of causation, indicating a logical sequence of cause and effect, then
there is a juridical basis for such a determination, notwithstanding the existence
of other plausible theories with or without support in the evidence.” [Emphasis
added; see also Karbel, 247 Mich App at 98.]
Here, multiple explanations exist for the facts the trial court relied on to assert
jurisdiction. Evidence is simply lacking to establish “a logical sequence of cause and effect” to
reach the conclusion that Asher controlled this litigation through Yoost such that “Yoost in this
case is the puppet and Asher is the puppeteer.” Rather, this conclusion is reached only through
speculation and conjecture which are insufficient to establish a prima facie case for limited
personal jurisdiction over Asher. Jeffrey, 448 Mich at 184; Berryman, 193 Mich App at 92.
B. THE TRANSACTION OF ANY BUSINESS WITHIN THE STATE
In the trial court, Zalcberg asserted that the exercise of limited personal jurisdiction over
Asher was proper under MCL 600.705(1) for actions “arising out of” the “transaction of any
business within the state.” The trial court rejected this basis for asserting jurisdiction because
“payment of the legal fees, which may ultimately go to lawyers in Michigan who represent
Yoost, is not a sufficient tie to Michigan to cause the defendant Asher to submit himself to the
jurisdiction of this state.” Zalcberg did not file a cross-appeal regarding the trial court’s rejection
of this basis for long arm jurisdiction. When leave to appeal is granted, unless the Court directs
otherwise, the appeal is limited to the issues raised in the application. MCR 7.205(D)(4); Detroit
Free Press, Inc v Southfield, 269 Mich App 275, 290; 713 NW2d 28 (2005). Zalcberg, however,
asserts MCL 600.705(1) provides an alternative basis for affirming the trial court. See
Middlebrooks v Wayne Co, 446 Mich 151, 166 n 41; 521 NW2d 774 (1994). We conclude the
trial court correctly ruled that § 705(1) does not provide a basis for limited personal jurisdiction
over Asher.
The word “any” within the statute has been interpreted to “include[] ‘each’ and ‘every.’
It comprehends ‘the slightest.” Sifers v Horen, 385 Mich 195, 199 n 2; 188 NW2d 629 (1971).
In Sifers, the Michigan plaintiff negotiated for the services of a Kentucky attorney, while the
attorney was in Michigan, to bring a lawsuit in Kentucky. The plaintiff later sued the Kentucky
attorney in Michigan for malpractice. The Sifers Court held that the negotiations in Michigan
resulting in the defendant’s retainer were within the meaning of the transaction of any business.
Id. at 199.
In McPheron, Inc v Koning, 125 Mich App 325; 336 NW2d 474 (1983), the defendant
Michigan resident sent his agent to Oklahoma to sell an airplane. When the sales negotiations
broke down, the agent tried to take the plane back to Michigan but was arrested. The defendant
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then hired the plaintiff, an Oklahoma attorney, to represent the defendant’s agent. When the
defendant failed to pay for all the legal services provided, the plaintiff obtained a default
judgment against him in Oklahoma and sought to enforce the judgment in Michigan. McPheron,
125 Mich App at 327-328. This Court held that because the defendant sought and contracted for
the plaintiff’s services to be performed in Oklahoma, “it is reasonable to conclude that he ought
to have been prepared to travel to Oklahoma to challenge these services if he felt they were
rendered improperly.” This Court opined that the Oklahoma court properly exercised
jurisdiction over the defendant under its long-arm statute similar to Michigan’s § 705(1) and that
due process was also satisfied. Id. at 331-334.
Sifers and McPheron are the main cases on which Zalcberg relies for his alternative
argument that the trial court’s jurisdictional ruling be affirmed under MCL 600.705(1). We find
each case clearly distinguishable from the facts as established by the evidence submitted on
Asher’s motion for summary disposition. In each case, a resident of one state contracted with an
attorney in another state for legal services. In each case, the subsequent legal action arose out of
the contract for legal services and was by or against the attorney who had performed the legal
services. In this case, there is no evidence that Asher contracted for the services of any attorney
to represent Yoost in Michigan. Although Asher admits making payments on Yoost’s legal fees
outside Michigan, Asher avers that he did not contract for the services and did not control the
litigation. Additionally, Zalcberg’s counterclaim is not an action between the parties to the legal
services contract as in Sifers and McPheron. Finally, for the reasons stated in Part III(A), supra,
even if this litigation constitutes the “transaction of any business within the state,” there was no
prima facie evidence that Asher controlled or directed the litigation to permit the trial court to
exercise limited personal jurisdiction over Asher under MCL 600.705(1). Consequently, we
conclude the trial court correctly ruled that this subsection did not authorize it to exercise limited
personal jurisdiction over Asher.
IV. CONCLUSION
For the reasons discussed in this opinion, we conclude that the trial court erred by ruling
it could exercise limited personal jurisdiction over Asher under MCL 600.705(2). We also find
that MCL 600.705(1) does not provide an alternative basis to affirm the trial court’s
jurisdictional ruling. Because Zalcberg did not establish a prima facie case for the exercise of
limited personal jurisdiction over Asher under MCL 600.705, the trial court erred by not granting
his motion for summary disposition under MCR 2.116(C)(1). Also, because Michigan’s longarm statute has not been satisfied, we need not consider whether the exercise of limited personal
jurisdiction over Asher comports with the requirements of due process. See Jeffrey, 448 Mich
184-185; Oberlies, 246 Mich App at 427-428, 432. We therefore reverse and remand for entry
of an order granting Asher summary disposition. We do not retain jurisdiction. As the
prevailing party, counter-defendant may tax costs pursuant to MCR 7.219.
/s/ Donald S. Owens
/s/ Jane E. Markey
/s/ Patrick M. Meter
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