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MCOA - Can Terminate Rights of Parent When Children Safely Living with Other Parent

Posted on Friday, February 23, 2018

In this termination case, In re Jones, Minors, No. 336271, the Department of Health and Human Services (DHHS) appealed the Oakland County Circuit Court’s order dismissing the petition to adjudicate and terminate the parental rights of the respondent-mother to her three minor children.
The Michigan Court of Appeals (MCOA) reversed and remanded the matter for further proceedings. The Michigan Supreme Court denied the request for leave to appeal by the mother.
FACTS: The facts are that three of the children live with their father who was granted sole legal and physical custody in 2014. The mother was not granted parenting time with those children. The fourth child, AM, lived with the mother until May 15, 2016 when AM was found dead in her home. The medical examiner performed an autopsy on the partially decomposed body and, although unable to determine the exact cause of death, ruled the death a homicide. The mother never reported the death. She was arrested, charged with felony murder, second-degree murder, first and second-degree child abuse and failure to report a dead body. As of September 14, 2017, she was awaiting trial in Wayne County.
DHHS filed a petition to terminate the mother’s parental rights to her three children in Oakland Circuit Court, which authorized the petition then ordered it transferred to Wayne County, which refused to accept the case. The mother didn’t admit to the allegations in the petition nor was a trial held, however, the trial court dismissed the petition.
Oakland Circuit court’s reasoning for dismissal was that it was impossible to establish jurisdiction since the children, placed with their father, were safe; and, since it was unlikely that the children would ever see their mother, assuming jurisdiction over them wasn’t in the interests of judicial economy.
Analysis:
DHHS, in challenging the dismissal, argued that the fact that the children are safely placed with their father didn’t detract from the danger the mother posed to the children if they were ever to be returned to her care and does not prevent the trial court from finding jurisdiction under MCL 712A.2(b).
The mother and the children’s lawyer-guardian ad-litem (L-GAL) disagreed, arguing that,
because the children were safely in the care of their father, they were not being neglected, had not been abandoned, and were not at a substantial risk of harm to their mental well-being, the trial court could not have possibly have jurisdiction pursuant to MCL 712A.2(b).
The MCOA noted that the state may exercise its authority to protect children by seeking an adjudication over one or both parents as the circumstances warrant. And, the court noted, as found in prior opinions and once jurisdiction over the children is established, may also terminate the rights of one parent while the children are living safely with another.
The MCOA reversed and remanded the matter back to the trial court stating: “we find that the trial court clearly erred by concluding that the children’s safe placement with their” father barred its exercise of jurisdiction under MCL 712A.2(b). And, because the trial court didn’t conduct an adjudication trial, the court couldn’t determine whether jurisdiction would be appropriate.

The matter was appealed to the Michigan Supreme Court which was denied.

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Alter-Ego Theory of Recovery - What is it and When is it Effective?

Posted on Tuesday, February 20, 2018

In a case out of Oakland County, Elkins v Benner, Nos 331701, 332664, 333114, the plaintiff Elkins argued the alter-ego rule to make the defendant Nancy Benner, spouse, responsible for her ex-husband/disbarred attorneys’ failure to pay the agreed upon referral fee. The defendant filed a motion for summary disposition. In addition to opposing defendant’s motion for summary disposition, plaintiff filed a motion to amend his complaint to add or clarify claims and
to impose a constructive trust on the proceeds of the sale of the defendant’s home. The Michigan Court of Appeals disagreed with the alter-ego argument but upheld the arguments on conversion and the Uniform Fraudulent Transfer Act.
Facts: Plaintiff-Elkins, an attorney, alleges that defendant-Nancy’s former husband, Brian Benner, failed to pay a referral fee ($169,000) for a client that Elkins referred to Benner. Elkins’ theory was that Benner misappropriated client funds, including funds for the attorney referral fee that Benner owed plaintiff, and that defendant-Nancy acted in concert with Benner to defraud Elkins through a sham divorce and property settlement, and that she was unjustly enriched by Benner’s misdeeds.
The Alter-Ego Rule
Elkin’s complaint alleges that defendant-Nancy acted as Benner’s alter ego to misappropriate client funds and shield those funds from creditors, and therefore, defendant could be held personally liable for the attorney referral fee that Benner agreed to pay plaintiff. The trial court agreed with her that Elkins failed to state a “claim for alter ego because there’s no corporate entity involved.”
The trial court refused to allow plaintiff to amend his complaint to further clarify this claim because “there is no such thing as alter ego, and you don’t plead any specificity as to that anyways, as to the fraud you allege.” We agree with the trial court that there is no basis in this situation for applying the alter-ego rule to allow the imposition of liability on defendant for Benner’s alleged misdeeds.
The alter-ego theory allows a court to disregard a corporate entity in order to impose liability on a person or a subservient corporation for the corporation’s misdeeds. The theory allows a defendant who is the victim of fraud, illegality or injustice to pierce the corporate veil to seek justice.
In this case, Elkins argues that the rule can be extended to individuals. The lower court disagreed saying a spousal relationship is not enough to hold one spouse liable for the illegal acts of the other. There must be evidence of some legal relationship besides the marriage for the rule to apply. The MCOA agreed and affirmed the lower court’s denial of the Alter-ego claim.
Conversion
Plaintiff Elkins argued that he had a claim for statutory conversion (MCL600.2919a) because he had an intangible property right to the referral fee, which Benner converted and defendant Nancy aided that conversion.
First, the court looked to the Rules of Professional Conduct for guidance, concluding the rules and case law support the reasoning that an action for conversion can be brought where one attorney fails to turn over another attorney’s referral fee. Second, although Benner can be held liable for converting the alleged referral fee, can Elkin’s show a legal basis for imposing liability on Nancy, Benner’s ex-wife?
The statute does allow liability be placed on a party who knowingly receives converted property. The MCOA stated that Elkins alleged enough facts to argue that Nancy knew and participated in a scheme to convert client funds for personal use, therefore the matter was remanded for further proceedings
The Uniform Fraudulent Transfer Act
The trial court also denied plaintiff’s motion to amend his complaint to add a claim under
the UFTA. Plaintiff’s proposed amended complaint alleged that defendant and Benner conspired
to use their divorce property settlement to facilitate the transfer of property from Benner to
defendant to shield the property from Benner’s creditors, including plaintiff. The trial court
erred in ruling that plaintiff was precluded from challenging the property settlement as an
improper transfer of marital assets under the UFTA because such a challenge amounted to an
improper collateral attack on the divorce judgment.
While defendant argues that the property transferred to her through the divorce is property held
as tenants by the entirety, and therefore, cannot be the subject of any claim under the UFTA, the status of the property was not addressed or decided below and cannot be ascertained on the basis of the current record. Thus, the MCOA reasoned that it was not apparent that any amendment to add a claim under the UFTA would be clearly futile. The trial court did not identify any basis other than futility to deny plaintiff’s motion to amend. Because the record fails to demonstrate that a claim under the UFTA would be futile, the MCOA reversed the trial court’s order denying plaintiff’s motion to amend his complaint to add a claim under the UFTA.
Conclusion:
The MCOA affirmed in part and reversed in part the trial court’s order granting defendant’s motion for summary disposition and denying plaintiff’s motion to amend his complaint, vacated the trial court’s orders granting defendant’s motion for sanctions and denied plaintiff’s motion for sanctions, and remanded for further proceedings. 

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Court of Appeals Addresses Standard and Burden of Proof for Removal of an Incapacitated Adult's Guardian

Posted on Monday, November 6, 2017
            
            In its recently published opinion, In re Guardianship of Dorothy Redd, __ Mich App __; __ NW2d __ (2017) (Docket 335152), the Court of Appeals addressed the standard for removal as well as the burden of proof for removing the guardian of an adult. The case involved Dorothy, an incapacitated elderly woman, Gary, her son, and Nichole, Gary’s daughter and Dorothy’s granddaughter. Gary had served as Dorothy’s guardian for 2 years. Nichole then petitioned for his removal and replacement as guardian because he was allegedly no longer suitable based on his actions in the proceeding 2 years. Nichole’s allegations were predominately centered around disputes within the family and focused on Gary having repeatedly prevented Dorothy from seeing members of their family including her other children. The Probate Court granted Nichole’s petition to remove Gary as guardian and ruled that even though Gary was Dorothy’s clear preferred guardian, her preference was trumped by his unsuitability. Gary’s appeal followed. 
          The Estates and Protected Individuals Code (“EPIC”) deals with, among other things, the appointment of guardians for incapacitated individuals. EPIC provides a list of people who can be appointed as a ward’s guardian, including someone who the ward chooses. It also provides the caveat that the preferred guardian must be “suitable and willing to serve”. EPIC also provides that a guardian can be removed if they are no longer suitable to serve. Gary’s suitability was the focus of Nichole’s Probate Court petition and Gary’s appeal. 
          EPIC does not specifically addresses the standard for a guardian’s removal, so the Court of Appeals dug into the issue in its opinion in Redd. The Court held that the standard for appointing a guardian under EPIC was the same as the standard for removing a guardian and that to remove a guardian, a Probate Court “must find that a guardian is no longer suitable and willing to serve.” The next relevant question, is whether a guardian is suitable.
          EPIC does not define the term “suitable” so the Court of Appeals turned to a combination of the statutory purpose of a guardian and the legal dictionary definition of the term. EPIC provides that a guardian’s purpose and role is to provide “for the ward’s care, custody and control.” Black’s Law Dictionary defines “suitable” as “fit and appropriate for [the] intended purpose.”  Taken together, the Court of Appeals concluded that a suitable guardian “is one who is qualified and able to provide for the ward’s care, custody and control.”
          Next, the Court of Appeals analyzed the burden of proof that a petitioner is required to show to demonstrate that a guardian is not suitable and should be removed. EPIC instructs a Probate Court to use the clear and convincing standard when determining whether or not a person needs a guardian. But the statutes do not provide instruction as to the evidentiary standard for removing a guardian. The Court of Appeals interpreted that omission as intentional and concluded that the clear and convincing standard did not apply to the removal stage. Citing Mayor of Cadillac v Blackburn, 306 Mich App 512, 522; 857 NW2d 529 (2014), the Court of Appeals concluded that because relevant statutes do not state which standard of evidence a Probate Court should require for the removal of a guardian, the default standard of a preponderance of the evidence should be applied.
          The Court of Appeals concluded that the Probate Court in Redd correctly applied the preponderance standard and that it did not clearly err in its findings of facts. The Probate Court’s decision was affirmed, however Gary subsequently filed an application to the Michigan Supreme Court which is currently pending. 

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Can the Proceeds of a Life Insurance Policy be Subject to Garnishment?

Posted on Wednesday, November 1, 2017

writ of garnishment:  an order requiring a third-party to withhold some type of property (usually money) of the defendant's (also called the “garnishee” or “judgment debtor,”) for delivery to a creditor to whom they owe an overdue debt.

            A writ of garnishment, upheld by the lower court following a motion to quash, was reversed and remanded by the Michigan Court of Appeals (COA) in DC Mex Holdings LLC v Affordable Land LLC (Docket 332489) due to trial court error.
FACTS:
            On October 7, 2013, plaintiff, DC Mex Holdings, LLC, was awarded a $2,500,000 judgment against defendant, Affordable Land, LLC, and defendant-appellant, Dale B. Fuller, jointly and severally. After the judgment was affirmed on appeal, DC Mex filed a request for a writ of non-periodic garnishment naming the Prudential Insurance Company of America as the garnishee because Fuller owned an individual life insurance policy from Prudential with an approximate cash value of $73,078.91.

            Prudential in its answer stated that “[l]ife insurance may be exempt from garnishment under” MCL 500.2207. Fuller argued that the funds were exempt and that the cash value was not owing and didn’t represent a debt. DC Mex did not dispute that MCL 500.2207 exempted life insurance proceeds, including the cash value, but, under DC Mex’s interpretation of MCL 500.2207, the exemption only applied when the money became payable (i.e., after the insured’s death).
            The trial court, relying the plain language of MCL 600.6104(3), which allows for the satisfaction of a judgment out of any property, liquidated or unliquidated, that is not exempt, issued an order denying Fuller’s objection to the writ of garnishment.
Analysis:
            The statute that governs the exemption at issue on appeal is MCL 500.2207(1), which states, in relevant part:

“the proceeds of any policy of life or endowment insurance, which is payable to the wife, husband or children of the insured or to a trustee for the benefit of the wife, husband or children of the insured, including the cash value thereof, shall be exempt from execution or liability to any creditor of the insured;”

            In interpreting that portion of the statute, the COA traced its history which goes back to the 1800s. The language exempting the proceeds has remained consistent over time. The court discussed at length Equitable Life Assurance Society of United States v Hitchcock, 270 Mich 72, 80; 258 NW 214 (1935). The Equitable Life Court explained that the statute . . . was later amended to add the following clause:

‘And the proceeds of any policy of life or endowment insurance, which is payable to the wife, husband or children of the insured, including the cash value thereof, shall be exempt from execution or liability to any creditor of the insured.’
This Court concluded that the proceeds of the policy, whether a death benefit or cash value, are exempt under MCL 500.2207 (1). The Court noted that it had previously explained that “[i]n regards to life insurance contracts, the general public policy is to protect the insurance taken out by a person for the maintenance and support of the person’s spouse and children from the claims of creditors after the person’s death” and that “[e]vidence of the Legislature’s intent as to this public policy can be found in MCL 500.2207(1) . . . .” Baltrusaitis v Cook, 174 Mich App 180, 182-183 (1988).

 Change in Beneficiary:
            In October 2011 when DC Mex filed its lawsuit, the beneficiary of Fuller’s life insurance policy was a revocable trust for the benefits of which were Fuller’s surviving children. In 2013, he changed the beneficiary to his only child, his daughter. DC Mex argued that the trust was not exempt. 
            This argument ignores the language of the statute which states “the proceeds of any policy of life or endowment insurance, which is payable to the wife, husband or children of the insured or to a trustee for the benefit of the wife, husband or children of the insured, including the cash value thereof, shall be exempt . . . .”
            The exemption clearly applies to life insurance policies payable to a trustee for the benefit of the children.
Conclusion:
            The court concluded that the cash value of Fuller’s life insurance policy was exempt from execution by a creditor and the trial court, therefore, erred in denying the motion to quash the garnishment.

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A Case to Watch - Voluntariness of Plea and Ineffective Assistance of Counsel - Now Back to Trial Court

Posted on Monday, October 30, 2017
   
             Defendant Timothy Horton was charged with breaking and entering with the intent to commit larceny as a fourth habitual offender. Horton agreed to plead no contest to the charge, in exchange for being charged as a second habitual offender. At the sentencing hearing, Horton moved to withdraw his plea, claiming that it was not freely, knowingly, and voluntarily made. His motion was denied and he was sentenced.
            Mr. Horton requested the appointment of appellate counsel who filed an Application for Leave to Appeal and Motion to Remand. The brief and motion claimed Defendant’s trial counsel was ineffective for:
(1) Failure to make a motion to dismiss for violation of a speedy trial,
(2) Failure to inform defendant if he pled no contest unconditionally without reserving the right to appeal issues involving speedy trial violations by the trial court, it constituted a plea waiver of these issues.
            The defendant argued that his plea was not knowing, intelligent, and voluntary and it was error to deny his motion to withdraw his plea prior to sentencing. In support of the Motion to Remand, Mr. Horton signed a sworn statement asserting that his trial counsel never informed him that an unconditional no contest plea would waive his rights to raise the violation of his speedy trial rights and his rights to the effective assistance of counsel on appeal. In addition, Mr. Horton would not have accepted the plea offer unless it was a conditional plea offer that allowed him to raise the speedy trial issue on appeal. Absent a conditional plea offer, Mr. Horton would have gone to trial.
            The Court of Appeals denied the motion to remand and denied leave to appeal. Mr. Horton filed a pro per Application for Leave to Appeal to Supreme Court. On December 9, 2015, the Supreme Court granted leave to appeal, People v Horton, 498 Mich 932, (2017) (Docket 150815), on the following issues:
  • Whether the defendant’s unconditional no contest plea waived his claim of ineffective assistance of trial counsel based on trial counsel’s failure to make a motion to dismiss for a 180-day rule violation or for constitutional speedy trial violations;
  • Whether the defendant’s unconditional no contest plea waived his claim of ineffective assistance of trial counsel for trial counsel’s failure to inform him that his plea would waive his right to appeal on the basis of a 180- day rule violation or constitutional speedy trial violations; and
  • Whether trial counsel’s failure to inform the defendant that his unconditional no contest plea would waive his right to appeal on the basis of a 180-day rule violation and constitutional speedy trial violation made defendant’s plea unknowing and involuntary.
            The Supreme Court, on July 25, 2017, after reviewing the briefs and oral arguments, remanded the case to the Court of Appeals for consideration. Stating that:

“A defendant who has entered a plea does not waive his opportunity to attack the voluntary and intelligent character of the plea by arguing that his or her counsel provided ineffective assistance during the plea bargaining process.”

            On remand, the Court of Appeals was to consider: (1) whether a speedy-trial claim is “nonjurisdictional” (2) if not, whether, by entering a plea of no-contest, the defendant waived his right to argue that his counsel was ineffective for failing to assert his constitutional right to a speedy trial before he entered his plea, and (3) whether the defendant’s no-contest plea was involuntarily entered based on his claim that his counsel provided ineffective assistance when counsel failed to advise the defendant during the plea proceedings that he would waive his right to raise his speedy-trial claim on appeal.
            In Horton’s brief on appeal, he asked the court to remand his case to the trial court to allow him to withdraw his plea. The parties filed a joint motion to remand the case to the trial court, which the Court of Appeals granted. This case may be one to watch since the questions raised by the Supreme Court have not been answered. 

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Problems with the Court of Appeals' Adoption Trilogy Decision

Posted on Tuesday, September 12, 2017
Adoption attorneys and adoption agencies laud the Court of Appeals published decision in “the Adoption Trilogy,” In Re MJG and In Re BGP/JSP. (See July 12, 2017 blog - Adoption Trilogy secures the future of direct placement adoptions in Michigan). However, there are a few weak spots to the Court of Appeals' analysis, and provides something to keep in mind for future cases.
  • The Court of Appeals said that a fee for apprising clients (potential adoptive parents) of the birth mother is prohibited under 710.54(2) because it was “assisting a potential adoptive parent in evaluating a parent or guardian or adoptee or referring a prospective adoptive parent to parent or guardian a child for the purpose of adoption. In re MJG slip op at 10. However, this fee simply informs prospective adoptive parents that the birth mother has responded to the adoptive parents profile and is not “evaluating” or “referring.” Moreover, most of the “apprising” does not pertain to the Michigan adoption because only one of the birth mothers (many times out of hundreds) will be the birth mother of the adoptee.
  • The Court of Appeals also said that "presenting an adoption opportunity to a client" is prohibited under MCL 710.24(2). In re MJG slip op 11. This is not “evaluating” or “referring.” Instead, it is merely sharing the profile the birth mother has found on the potential adoptive parents on the internet. It is accepting the contact from the birth mother and passing it onto the potential adoptive parents/client.
  • The Court of Appeals concluded that “introducing the birth mother to the potential adoptive parents/client” is the equivalent of referring the birth mother to the client and is prohibited under MCL 710.54(2). In re MJG slip op at 12. This poses the same problem as the examples cited above.
  • Various services do not fall under MCL 710.54(3) and are, thus, not allowed according to the Court of Appeals. In re MJG slip op at 12. The Court of Appeals includes referring clients to agencies, social workers, and attorneys; managing the adoption plan; and communicating with legal entities In re MJG slip op at 213. But see note 10 on counseling where the Court of Appeals noted that parents in general can benefit from counseling does not mean that the counseling is in connection with the adoption.
  • The Court of Appeals held that American Family Media lacked standing because they were not included on the claim of appeal (the Court of Appeals denied the motion to amend the claim of appeal), but the marketing fees which American Family Media charged in that case cannot be disallowed per the Court's decision in MJG.  In Re BGP/JSP slip op at 2. Since Circuit Court has no authority to preclude the marketing fees charged by the media company, the Court of Appeals should have allowed American Family Media to participate in the appeal. In re BGP/JSP slip op at 7.
In sum, the main problem with the Court of Appeals' decisions in the Adoption Trilogy pertains to the fees charged for informing the prospective adoptive parents that a potential birth mother has responded to the prospective adoptive parents’ availability to adopt.

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Adoption Trilogy Secures the Future of Direct Placement Adoptions in Michigan

Posted on Wednesday, July 12, 2017
           
              We don’t think we are exaggerating the significance of two published opinions released by the Court of Appeals yesterday in In re MJG (Docket 332928) and In re JSP/In re BGP (Dockets 333700, 333813). These three appeals challenged the trial courts' denials of out-of-state adoption agencies' adoption fees. If the trial courts’ decisions were upheld and the agencies were not allowed to be paid for the services they rendered, then agencies would not be able to perform direct placement adoptions in Michigan at all. After all, even a non-profit organization has to be able to pay its staff, rent, utilities, and all the services that go into an adoption. And although the Adoption Trilogy involved out-of-state agencies, three other appeals are also pending that involved an in-state adoption agency whose fees were similarly denied by trial courts.  
               In all three cases the fees were uncontested and based on contract between the adoptive family and the adoption agency, the agency and adoptive family were both out of state, the birth mother and child were in Michigan, and the cases were filed in Oakland County.  In JSP and BGP, the trial court denied the fees without a hearing, when the only evidence presented was a lengthy letter from the agency detailing the fees (again, unrebutted), and the trial court approved some of the fees, but denied other fees.  In MJG, the trial court held an evidentiary hearing where a representative from the adoption organization testified by phone about the fees, and the trial court denied all fees of the organization.
               The COA conducted a thorough review of MCL 710.54 which delineates which adoption fees are allowable (710.54(3)), which fees are allowable only upon court approval (710.54(1)) and which fees are prohibited (710.54(2)).  The COA also discussed three other important subsections of MCL 710.54.  Section 7 requires a verified accounting submitted by the adoptive family “itemizing all payments ….made or agreed to be made by the petitioner in connection with the adoption.” MCL 710.54(7) (emphasis added). Section 10 requires the court to “approve or disapprove all fees and expenses.” MCL 710.54(10). And Section (11) imposes criminal liability if a person violates MCL 710.54.
             The Court of Appeals set forth a multi-step process for a trial court to evaluate fees in an adoption case. First, the court must determine whether the fee is “in connection with an adoption,” as required by MCL 710.54(7).  The court has an independent obligation to make this inquiry even when the fee is included on the disclosure form because petitioners will tend to over-include fees as there are criminal penalties for not reporting.  So if the fee was for services rendered before an adoptive family and child are identified, then they are not in connection with that particular adoption. Also, general administrative fees of the agency (often pro-rated over all of the agencies clients) are not in connection with a particular adoption.  If the fees are not in connection with an adoption, then the “court has no authority to disapprove the fees.”  Second, if the fees are in connection with an adoption, then the court must determine whether the fees fall under MCL 710.54(1) – such that court approval is required, or under MCL 710.54(2) -- such that the fee is prohibited. Third, if the fees are not prohibited by Sections (1) or (2), then the trial court must determine whether the fees are permitted under the exclusive list contained in MCL 710.54(3), and if they are in this list, the trial court must determine whether the fee is “reasonable and actual.” Fourth, although not at issue in the Adoption Trilogy, the Trial Court should also confirm whether the fees are required in Sections (4) or (5).

Reviewing the fees from the Adoption Trilogy, the COA reached the following conclusions:

  • Marketing fees to promote the profile of an adoptive family, often on a nationwide or even international basis, are not in connection with an adoption, and cannot be disallowed.
  • Administrative fees of the agency, such as general contract labor, IT services, payroll, health insurance, professional insurance, office supplies, and rent, are not in connection with the adoption itself and cannot be disallowed.
  • Preliminary fees for work done before any potential adoptees or birth mothers are identified are not in connection with the adoption (much less the specific adoption that occurred of a specific child in Michigan) and cannot be disallowed.
  • Apprising the client of various birth mothers, are connected to the adoption, and fall under the prohibited category of “referring a prospective adoptive parent to a parent or guardian of a child for purposes of adoption.”
  • Generating a profile for the birth mother and comparing the alignment of preferences of the birth mother and the adoptive parents are prohibited under MCL 710.54(2)(a) and (b) because they amount to assisting the birth mother and adoptive parents evaluate each other.
  • Presenting an adoption opportunity to the clients is prohibited under MCL 710.54(1)(b) or MCL 710.65(2)(d) because they are communicating the existence of a child available for adoption or referring a parent or guardian to a prospective adoptive family. 
  • The intake meetings with the birth mother is allowed under MCL 710.54(3)(c) as counseling of a parent, along with directing and assisting the birth mother to have a physical evaluation, screenings, and testing.
  • Obtaining medical records and information about possible birth fathers are allowed under MCL 710.54(3) as expenses incurred in ascertaining information required under the Adoption Code about an adoptee and the adoptee’s biological family and under MCL 710.27, which requires accounts of the health and genetic history of the child and biological parents. 
  • Analyzing the legal requirements and applicable laws is allowed under MCL 710.54(3)(f) as legal services.
  • Introducing the birth mother to the adoptive family is prohibited under MCL 710.54(2)(c) and (d) as a referral between the adopters and parents.
  • Providing medical records is allowed under MCL 710.54(3)(e).
  • Paying for the birth mother’s needs and transportation is allowed under MCL 710.54(3)(d) and (g).
  • Assisting the birth mother in applying for insurance, securing professional counseling, mentoring support services, and support to the birth mother is allowed under MCL 710.54(3)(c).
  • Referring the adoptive family to agencies, social workers, and attorneys; managing the adoption plan; communicating with legal entities are not contained within MCL 710.54(3), and are there not allowed.
  • Counseling services for the adoptive family is not allowed under MCL 710.54(3), although it “would be payable if these counseling services … [were not] in connection with the adoption.”
            While we take issue with a few of the points addressed by the Court of Appeals’ opinions, the overall outcome is a good result and should be workable in the future – although it will certainly require more thought and evaluation by the trial courts to determine whether to allow, prohibit, or disregard the fees that cannot be disallowed.

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Jennifer Alberts Quoted in Michigan Lawyers Weekly Regarding Geering Appeal

Posted on Friday, July 7, 2017
           
              This week's Michigan Lawyer's Weekly issue covered the recent Speaker Law Firm published victory in Geering v Geering.
               Jennifer M. Alberts, plaintiffs attorney in the Geering case, said, "Grandparents do not have rights to visitation, so parents' rights will always be favored over the interests of the grandparents. The only concern that may outweigh the parents' rights is the well-being of the child, but it is presumed that parents act in their child's best interests.Thus, it is a high bar for grandparents to meet."
               "These cases largely reaffirmed what has been the law for years and what is clearly laid out in the statute.- Alberts, of Speaker Law Firm PLLC, said the "main takeaway from Geering is the definition of parental fitness: the Court defined a fit parent as one who 'adequately cares for his or her children.'"
               "This is important as the protections the statute affords to parents are specifically afforded to 'fit parents,'" she said. Whether there is a high bar depends on the circumstances, Alberts said.
               "If two fit parents deny grandparenting time, then under the statute, the case ends. That is all there is to it. If only one fit parent denies grandpa renting time, then the grandparent has to prove that the denial creates a substantial risk of harm to the child. The parent or parents who deny grandparenting time are unfit only if they do not 'adequately care for' their children. It is a high bar," she said.
               "If the parents disagreed, then the grandparents would have had to prove that the denial of grandparenting time created substantial risk of hann to the child, rather than having to prove that the parents were unfit," Alberts said.
               "It is still a high bar because there is still a presumption that the parent who is denying grandparenting time is acting in the best interests of the children, but it is a rebuttal presumption, rather than the irrebuttable presumption created by filing a joint affidavit."

Read our previous blog about Geering v Robinson HERE.

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COA holds no res judicata for tort/uninsured motorist claims due to prior PIP claims

Posted on Wednesday, August 12, 2015
On August 11, 2015, the Court of Appeals decided in a published opinion Adam v Bell (Docket No 319778), and overturned an order granting summary disposition to State Farm on the grounds that Cynthia Adam’s claims were barred by res judicata. Adam was injured when she was struck by a vehicle driven by Susan Bell. The question was whether an earlier claim for PIP benefits barred a later third-party claim for third-party negligence and uninsured motorist (UM) benefits. Adam and State Farm settled the PIP benefits claim, and the trial court dismissed Adam’s claims for benefits up to October 15, 2012. On January 16, 2013, Adam filed a claim alleging negligence against Bell and breach of contract against State Farm for failure to pay UM benefits. On State Farm’s motion, the trial court dismissed the UM claim because it “clearly could have been filed in the prior matter and was not, therefore, the claim is barred by res judicata.” The Court of Appeals reversed. The Court reasoned that, because PIP benefits do not require proof of fault, and are intended for the immediate relief and care of the injured party, a PIP claim is significantly different from a tort or contract claim, even though they arise from the same accident, injuries, and insurance policy. Notably, PIP claims have a one year statute of limitations. UM claims, however, require proof of fault, and the injured person may need more time to collect the necessary facts. “Thus, while an injured person will likely have all the facts necessary to make a meaningful decision to pursue a PIP claim within a relatively short time after an accident, the same cannot be said for the injured person’s ability to pursue a claim for uninsured motorist benefits.” In addition, the statute of limitations may run on a PIP claim before a tort/UM claim becomes anything more than a possibility. Finally, UM claims involve “compensation for past and future pain and suffering and other economic and noneconomic losses” rather than PIP claims involving “compensation for immediate expenses related to the injured person’s care and recovery.” Because PIP claims and tort/UM claims are fundamentally different, and “applying res judicata to essentially require mandatory joinder of a mere potential UM claim with a PIP claim would be inconsistent with the very divergent statutory treatment of these two very different types of no-fault claims,” the Court of Appeals reversed the trial court’s grant of summary judgment on the grounds of res judicata, and remanded for further proceedings.

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Presumed Father is a Necessary Party to a Revocation of Paternity Act Claim

Posted on Thursday, June 18, 2015
In Graham v Foster, ___ Mich App __; __ NW2d __ (2015), the Court of Appeals held that a presumed father, ie, a mother's husband at the time of conception or birth of a child, is a necessary party to a Revocation of Paternity Act claim. The Court of Appeals affirmed the trial court's denial of summary disposition where an “alleged father” under MCL 722.1433(c), ie, “a man who by his actions could have fathered the child,” filed a complaint under the Revocation of Paternity Act seeking an order determining his paternity, an order of filiation, and joint custody with reasonable parenting time. Slip op at 1-2. The alleged father only named the mother as a defendant in the complaint. Slip op at 2. The mother filed a motion for summary disposition claiming that the alleged father could not satisfy the necessary factual requirements under MCL 722.1441(3)(a) and that the case should also be dismissed for failure to join a necessary party: the “presumed father.” Slip op at 2. She also argued that the statute of limitations had run, so the alleged father could no longer join the presumed father as a defendant. Slip op at 2. The alleged father argued that the presumed father was not a necessary party, and if he was a necessary party, requested the trial court allow him to amend his complaint to add the presumed father as a defendant. Slip op at 2. The trial court denied the mother's motion, concluding that genuine issues of material fact existed regarding whether the factual requirements were met and that the husband was not a necessary party to the litigation. Slip op at 2-3. The mother appealed the trial court's decision that the presumed father was not a necessary party. Slip op at 3. 

The Court of Appeals held that a “'presumed father' under MCL 722.1433(e), ie, “a man . . . presumed to be the child's father by virtue of his marriage to the child's mother at the time of the child's conception or birth,” is a necessary party under MCR 2.205 (necessary joinder) because the presumed father has legal rights of parenthood and “[a] successful action by [the alleged father” would strip [the presumed father] of interests that must not be set aside without [the presumed father]'s fair chance to defend those interests.” Slip op at 3-4. The Court of Appeals further held that while generally the filing of an amended complaint that adds in a defendant means that the date of the amended complaint is used to determine if the statute of limitations has run, if the additional defendant to be added is a necessary party, the necessary party can be joined even after the expiration of the limitations period. Slip op at 4. The Court of Appeals discussed that under MCR 2.118(A)(2) trial courts should allow amendment of pleadings “when justice so requires.” Slip op at 4. Thus, in Graham, the Court of Appeals held that the alleged father should be allowed to amend his complaint to add the presumed father and affirmed the denial of summary disposition. Slip op at 4. The Court of Appeals noted in a footnote that if the presumed father was not added as a defendant, the alleged father's claim “would be defective in that it would lack a necessary party.” Slip op at 4 n 3. The Court of Appeals also held that the alleged party's granted motion for genetic testing was premature in light of the fact that the presumed father had not yet been added as a party. Slip op at 4 n 3.

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Due Process for Enforcing Charging Liens Recorded in Divorce Judgments Does Not Require a Complaint to be Filed, Summons to be Obtained, or Process to be Served

Posted on Tuesday, June 17, 2014
At the end of last year, the Court of Appeals, in a published opinion, Souden v Souden, 303 Mich App 406; 844 NW2d 151 (2013), clarified the amount of due process required when an attorney seeks enforcement of charging liens secured by a divorce judgment signed by the client debtor. In Souden, each party was responsible for its own attorney fees, and pursuant to the judgment of divorce each attorney retained a lien on his or her client’s “share of the marital assets to insure payment of attorney fees.” Defendant Attorney filed a “Petition for Payment of Attorney Fees . . .” in family court to seek enforcement of the charging lien. Plaintiff Client argued that she was denied due process because: (1) the family court conducted the proceeding without subject matter jurisdiction; and (2) Defendant Attorney did not file a complaint, obtain summons, or serve process regarding the enforcement proceeding. The Court of Appeals disagreed. First, “[t]”he ability to enforce an attorney’s charging lien is ancillary to a trial court’s exercise of jurisdiction over the cases before it,” and family courts have “power to enforce charging liens secured by a judgment of divorce.” Second, due process was not violated primarily because notice of the charging lien was given on Plaintiff Client’s judgment of divorce. In addition, although Defendant Attorney did not file a complaint, obtain summons, or serve process on Plaintiff Client, Defendant Attorney did serve the petition—which Plaintiff Client answered—and the notice of hearing—which Plaintiff Client attended—on Plaintiff Client, satisfying due process. The Court of Appeals reasons that what might appear to be a surprise is actually a reasoned and appropriate response to the facts of the case. Minimal process was due because the judgment had already been entered. Plaintiff Client was afforded the notice required to appear in court and dispute the amount of money owed to Defendant Attorney (which the rest of the appeal was devoted to). Plaintiff Client was also afforded the service of the petition and could properly prepare for trial.

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Juvenile's Truancy Not Willful but Product of Bullying

Posted on Thursday, May 22, 2014
On April 15, 2014, in a published decision, the Michigan Court of Appeals held that absences attributable to fear of bullying were not “willful” absences under MCL 712A.2(a)(4). In People v. Napieraj (Docket No. 314305), the respondent, a minor, was found guilty of school truancy after he was absent from school a number of times. But the Court of Appeals reversed the decision, finding that the evidence indicated that the respondent’s absences were not willful. Both the respondent’s mother and the petitioner school had indicated that many of the respondent’s absences were attributable to illness and bullying, and the school’s attendance record indicated that the absences were excused based on calls made by the mother. The Court of Appeals held that the school could not require the mother to present them with a doctor’s note. Rather, the mother could exercise reasonable parental discretion, and the absences should have been excused upon her request. The Court of Appeals further noted that the referee should have discussed the willfulness element in the decision below and that the referee erred in failing to consider the individual facts of the respondent’s case.

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COA denies appeal because parent raised same challenge in prior appeal from different order

Posted on Friday, March 21, 2014
In re Green involved placement of children in a juvenile guardianship. What I found striking about the decision is that the COA held in this appeal by right that the issue was barred by the COA’s previous denial of a delayed application from a different order relating to the juvenile guardianship. In the delayed application, the parent challenged a Nov 2012 Order (following a dispositional review hearing and maintaining the juvenile guardianship placement) on the grounds that the guardianship violated the parent’s due process rights and resulted in a de facto termination absent clear and convincing evidence. There were other issues raised as well. The COA denied leave "on the merits." This is the standard language used in almost every order denying leave to the Court of Appeals. In the appeal by right, the parent challenged a July 2013 order, which formally established the juvenile guardianship. According to the COA, respondent raised the “very same arguments that she proffered in her application for leave, which were rejected on the merits by this Court.” Based on this, the COA applied the law of the case and affirmed the trial court’s decision. It seems that if the parent is appealing a different order, it should not matter that the parent is raising the same substantive issue, as it pertains to that new order. Indeed, in the Green case, there was more factual development, and other things had changed. The problem arises from giving res judicata effect to a leave denial when the COA does not give full consideration to the case in the first place.

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People v Trakhtenberg and the use of Collateral Estoppel by Prosecutors

Posted on Tuesday, January 29, 2013
In a recent opinion, the Michigan Supreme Court in People v Trakhtenberg, __ Mich __; __ NW2d __ (2012)(Docket No 143386) addressed a very narrow issue (among many larger issues) - the use of collateral estoppel by the prosecution to prevent a criminal defendant from challenging his trial counsel’s effectiveness. Defendant Trakhtenberg, after being convicted by the trial court and losing his direct appeal, filed a civil lawsuit alleging legal malpractice. This was summarily disposed of, by motion, and his appeal denied. In his criminal case, Defendant Trakhtenberg had filed a motion for relief from judgment which was denied by both the Trial Court and the Court of Appeals. However, the Supreme Court retained jurisdiction while remanding back to the COA to remand to the Trial Court for a Ginther hearing. Based on this hearing, the Trial Court ruled that Defendant’s counsel was ineffective and ordered a new trial, however, the COA reversed. The Supreme Court granted leave. The Supreme Court distinguished this case from cases like People v Gates, 434 Mich 146 (1990) and Yates v United States, 354 US 298 (1957) by noting first and foremost, it was the prosecution and not the Defendant asserting collateral estoppel “to estop the Court’s full review of defendant’s claim that he received ineffective assistance of counsel.” Ultimately the Court held that the COA erred when it applied the doctrine of collateral estoppel to Defendant Trakhtenberg’s ineffective assistance of counsel claim because the defendant did not have a “fair and full opportunity to litigate his claim in the malpractice proceeding.” While a narrow holding, this is still a potentially big win for similarly situated defendants.

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COA strictly construes MCL 600.2591 and sanctions attorney.

Posted on Monday, January 30, 2012
In the underlying action of In re Moore, unpublished per curiam opinion of the Court of Appeals, Docket No. 298100, December 22, 2011, an interested party in a probate estate (son) alleged that the personal representative provided fraudulent misinformation about the legal obligation to repay a mortgage loan secured by a mortgage on real property. The personal representative of the deceased father of Moore failed to list the mortgage loan as debt of the estate and failed to advise Moore of his obligation to pay the mortgage loan. The decedent’s estate was closed in 2007. The personal representative moved for summary disposition in this case because the 6-year statute of limitations on fraud passed. The personal representative also argued that Moore had all the information about the mortgage loan and moved for sanctions against Moore and his attorney under MCL 600.2591.

The probate court granted sanctions against Moore, but not against his attorney. The Court of Appeals modified the probate court’s sanction award to include sanctions against Moore’s attorney. The Court of Appeals stated that the statutory language and the definition of “and” were clear. It held that the statue required that sanctions be against both the party and the attorney when the trial court determines that a frivolous lawsuit has been filed.  

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Common Sense Prevails; Only Explanation for Ladder in Road is That it Fell Off a Motor Vehicle

Posted on Tuesday, April 20, 2010
Common sense prevailed in the published Court of Appeals opinion of Dancey v Travelers Property Casualty Co, issued April 6, 2010. In that case, a motorist was injured in single-vehicle accident after her vehicle hit a ladder lying in the roadway. Her insurance company denied her uninsured motorist benefits (which covers situations where there is a hit-and-run vehicle or where there is no direct physical contact with the hit-and-run vehicle). The insurance company argued that the insured was not entitled to benefits because she "no one could affirmatively state that the ladder fell off another vehicle."

After reviewing a series of older appellate decisions, the Court of Appeals affirmed the trial court's decision denying summary disposition. Even though none of the witnesses saw the ladder falling off a particular passing vehicle, the location of the ladder at the intersection of two freeways "supports an inference that the ladder in question must have fallen off another vehicle." The Court held that a jury could find that there was a substantial physical nexus between a hit-and-run vehicle and the ladder struck by plaintiff.

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Spouse "Waives" Goodbye to Argument in Divorce Appeal

Posted on Friday, December 4, 2009
In Vulaj v Vulaj, the Court of Appeals held that the plaintiff-husband waived his right to challenge the arbitrator's failure to comply with the Domestic Relations Arbitration Act, MCL 600.5070. When the defendant filed a motion for entry of judgment based on the arbitration award, the plaintiff's attorney, speaking of the arbitration award, simply stated, "my client just didn't like the arbitration," without formally objecting to it.

Plaintiff waited to challenge errors in the arbitration procedure on appeal. The COA held that plaintiff had expressly waived his right to challenge the arbitration errors at the hearing on the motion for entry of the arbitration award. Although the COA noted that preservation rules are discretionary, it reasoned that failure to apply them to cases like this encourages parties to sit on their objections. The COA stated, "there is nothing to stop a trial lawyers from either holding back on issues for use in a subsequent appellate attack on an unfavorable judgment, or to stop newly retained appellate counsel from sifting through the record and presenting issues to our Court for the first time. Under either approach, not only will there be a limited finality to any judgment of divorce entered after an arbitration award......but it will aslo result in unfettered gamesmanship in our appellate courts."

What can attorneys take from the Court's admonishment? When it comes to trial court objections, flaunt em' if you've got em' or "waive" them goodbye on appeal!

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Appellate Courts to Review Constitutionality of SORA as Applied to Juveniles?? Only Time Will Tell....

Posted on Wednesday, October 21, 2009
In a September 30, 2009 opinion, Washtenaw County Family Court Judge, Hon. Darlene O'Brien, called into question the constitutionality of SORA's application in juvenile cases. Specifically, O'Brien reasoned the mandatory reporting requirement as applied to juveniles does not serve a legitimate purpose given the most current evidence indicating a low recidivism rate for juvenile sex offenders in light of the overall purpose of juvenile law: rehabilitation not punishment.

Although the Court of Appeals has upheld the constitutionality of SORA's registration requirement as applied to juveniles, it did so in In re Ayers, decided in1999. At that time, juveniles were exempt from public registration. Since Ayers, juveniles are no longer exempt from public reporting. Also, in In re Wentworth, the COA questioned, "[T]he propriety of publicly and permanently labeling juveniles as convicted sex offenders" noting that, "public notification provisions of SORA appear to conflict with out traditional reluctance to criminalize juvenile offenses and our commitment to keep juvenile records confidential."

Judge O'Brien highlighted that the recidivism rates cited by the COA in Ayers are no longer accurate in light of recent published research. Without current data supporting high recidivism rates, or the protections afforded by non-public registration, Judge O'Brien concluded that mandatory reporting for a juvenile convicted of CSC II was unconstitutional.

As of this post, the prosecution has not filed an appeal. However, this issue has been a hot topic for Michigan practitioners since the opinion came out. If I asked my appellate Magic 8 Ball whether an appeal is likely, it would say, "All signs point to YES!"

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Michigan COA Rejects Foreign Divorce Entered Without Due Process

Posted on Wednesday, May 20, 2009
The Court of Appeals reversed a Michigan trial court's decision to recognize a foreign divorce in Tarikonda v Pinjari (unpublished decision). In that case, the parties are Muslim citizens of India who married in India, then moved to Michigan. The parties had one child, and when they separated, the wife stayed in Michigan with their son while the husband moved to New Jersey. At some point, the husband went to India and obtained a divorce under the Muslim personal law through the procedure known as the "triple talaq." Under Muslim law, a husband may summarily divorce his wife by pronouncing language such as, "I divorce thee," three times.

The month following the triple talaq divorce, the wife filed for divorce in Michigan. The husband moved to dismiss the complaint based on the existing divorce judgment from India. He presented a divorce certificate from India. The trial court dismissed the wife's divorce complaint, and instructed her to register the Indian divorce in Michigan and file a separate complaint for custody and child support.

The Court of Appeals held that the triple talaq violated the wife's constitutional rights and refused to affirm the trial court's recognition of the foreign divorce judgment because the wife did not have prior notice of the husband's pronouncement of the triple talaq, she was not represented by an attorney and had no right to be present at the pronouncement, and there was no opportunity to be heard on the merits.

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Why Aren't There More Conflicts Panels?

Posted on Friday, April 10, 2009
Over the years, I have observed that there are many times when the Court of Appeals in a published decision does not acknowledge a prior published opinion that is on point, or disagrees with a prior published opinion. In those instances, the later panel is supposed to call a conflicts panel under MCR 7.215(J), but that does not always happen. It seems that the later court's failure to convene a conflicts panel does a disservice to the parties, and all the litigants whose cases might be affected by the conflict.

For instance, in Froling Revocable Living Trust v Bloomfield Hills Country Club, a published opinion from April 9, 2009, the Court of Appeals recognized a previous conflict in Court of Appeals' published decisions on the issue of whether the Supreme Court's decision in Garg v Macomb County Community Mental Health Services regarding the continuing violations doctrine applied to all cases (including the nuisance and trespass case at issue in Froling) or only to civil rights cases (the issue presented by Garg). The published Court of Appeals' decisions after Garg disagreed on whether Garg abrogated the doctrine for all cases or just for civil rights employment discrimination cases. Because the later panels of published decisions failed to convene a conflicts panel, the Court of Appeals in Froling decided that it was bound by the earlier published decisions, and thus, the continuing violations doctrine has been abrogated for all cases in Michigan. Based on the reasoning of Froling, any time the Court of Appeals fails to convene a conflicts panel when a later published opinion does not follow a prior published opinion, other panels must follow the earlier decision and disregard the latter decision.

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