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Pioneer State Mutual Insurance Co. v. Michalek

Court of Appeals of Michigan

October 3, 2019

PIONEER STATE MUTUAL INSURANCE COMPANY, Plaintiff-Appellee,
v.
STEPHEN A. MICHALEK and BARBARA M. MICHALEK, Defendants-Appellants, and JUSTIN B. AGRESTI, Intervening Plaintiff. PIONEER STATE MUTUAL INSURANCE COMPANY, Plaintiff-Appellee,
v.
STEPHEN A. MICHALEK and BARBARA M. MICHALEK, Defendants, and JUSTIN B. AGRESTI, Intervening Plaintiff-Appellant.

          Berrien Circuit Court LC No. 14-000245-CK

          Before: Murray, C.J., and Meter and Fort Hood, JJ.

          MURRAY, C.J.

         These consolidated appeals are from a final order awarding attorney fees to plaintiff, Pioneer State Mutual Insurance Company, in a case where the trial court found after a bench trial that insurance fraud was committed by defendants, Stephen A. Michalek and Barbara M. Michalek. Intervening plaintiff, Justin B. Agresti, appeals the same order by right. We affirm.

         I. BACKGROUND

         In November 2011, Agresti was injured while riding his bicycle at defendants' (his grandparents) lakefront property in Dowagiac. At the time of the injury, the property was insured pursuant to a homeowner's policy issued by Pioneer. Agresti sued defendants in a separate premises liability action. Defendants signed a statement in the Agresti litigation in which they stated that members of defendants' family dug a hole on the property on July 4, 2011, to fix a faulty septic pump, and then failed to refill the hole upon departing the property. Defendants asserted that the hole remained unfilled in November 2011, when Agresti rode his bicycle into the hole and injured himself. Pioneer retained counsel for defendants in the Agresti litigation, and counsel advanced a challenge to the duty (or lack thereof) by asserting an open and obvious defense.

         After the trial court denied defendants' motion for summary disposition in the Agresti litigation, Pioneer commenced this action to void coverage under a fraud provision contained in the homeowner's policy. Pioneer alleged that defendants misrepresented that they dug a hole, and left the hole open until November 2011. Following a bench trial, the trial court issued an opinion on March 15, 2017, finding that defendants made fraudulent representations to Pioneer that voided the policy. Appellants moved for reconsideration of that opinion, but before addressing that motion, the trial court entered a judgment in favor of Pioneer on July 17, 2017. On August 15, 2017, the trial court denied their motion for reconsideration of the March opinion.

         On September 5, 2017, defendants filed a claim of appeal in this Court, appealing the August 15, 2017 trial court order denying their motion for reconsideration of the opinion. This Court dismissed the appeal for lack of jurisdiction because the August 15, 2017 order was not a final order under MCR 7.202(6)(a).[1] In doing so, this Court noted that the July 17, 2017 judgment "appears to be a final order." This Court dismissed Agresti's claim of appeal for the same reason.[2]

         Two days after this Court dismissed the appeals for lack of jurisdiction, appellants again moved for a new trial or relief from judgment. Then, before the trial court addressed and decided the motions, defendants filed in this Court an application for delayed appeal of the trial court's July 17, 2017 judgment. On the same day, the trial court held a motion hearing to address the second motions for a new trial or relief from judgment, but it did not rule on the motions.

         On May 18, 2018, this Court denied defendants' application for delayed appeal of the July 17, 2017 judgment "for lack of merit on the grounds presented."[3] Thereafter, the trial court entered an order granting Pioneer's motion for attorney fees and costs. The trial court held that, given its previous finding that defendants committed fraud, attorney fees were warranted under MCR 2.114(F). Defendants and Agresti separately appealed the order by right, and this Court consolidated the appeals.[4]

         II. CHALLENGES TO THE JULY 17, 2017 JUDGMENT

         Defendants advance several issues in this appeal that are unrelated to the award of attorney fees, and that they previously asserted in their application for delayed appeal the July 17, 2017 judgment. This Court denied that application for lack of merit in the grounds presented. Pioneer argues that consideration of these issues is barred by the law of the case doctrine. Pioneer is correct, but there is an additional jurisdictional ground that precludes us from considering these challenges to the July 17, 2017 judgment.

         We first address the jurisdictional issue.[5] In their claim of appeal forms, appellants identified the order that they are appealing by right as the June 19, 2018 order regarding attorney fees and costs, and in their docketing statements, they noted that the order was a postjudgment order. Under MCR 7.202(6)(a)(iv), a postjudgment award of attorney fees is a final order from which a claim of appeal can be taken. However, MCR 7.203(A)(1) limits the appeal taken under MCR 7.202(6)(a)(iv) "to the portion of the order with respect to which there is an appeal of right," meaning that these appeals only pertain to the award of attorney fees. Consequently, any issue outside those challenging the award of attorney fees goes beyond our jurisdiction over these appeals.

         Second, even if we had jurisdiction, Pioneer is correct: the law of the case doctrine would preclude our consideration of the issues arising out of the July 17, 2017 judgment. "The law of the case doctrine holds that a ruling by an appellate court on a particular issue binds the appellate court and all lower tribunals with respect to that issue." Ashker v Ford Motor Co, 245 Mich.App. 9, 13; 627 N.W.2d 1 (2001). "Thus, a question of law decided by an appellate court will not be decided differently on remand or in a subsequent appeal in the same case." Id. "The primary purpose of the doctrine is to maintain consistency and avoid reconsideration of matters once decided during the course of a single continuing lawsuit." Id. The doctrine applies "only to issues actually decided, either implicitly or explicitly, in the prior appeal." Grievance Admin v Lopatin, 462 Mich. 235, 260; 612 N.W.2d 120 (2000).

         In exercising the discretion afforded it when reviewing an application for leave to appeal, Great Lakes Realty Corp v Peters, 336 Mich. 325, 328; 57 N.W.2d 901 (1953), the Court has numerous options: it can grant the application and hear the case on the merits, deny the application, enter peremptory relief, or take any other action deemed appropriate. See MCR 7.205(E)(2). If the assigned panel determines that an application (late or otherwise) from a final order warrants denial, the panel often-as was done here-indicates that it is for "lack of merit on the grounds presented." In contrast to interlocutory applications for leave to appeal from nonfinal orders, where the Court generally does not express an opinion on the merits, applications for delayed appeal address whether to allow an appeal (filed after the 21-day period has elapsed) to be taken on a merits challenge to a final order. Hence, when we deny an application from a noninterlocutory order for lack of merit in the grounds presented, the order means what it says-it is on the merits of the case.[6] Consistent with this conclusion, this Court has previously applied the law of the case doctrine ...


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