United States District Court, E.D. Michigan, Southern Division
AND ORDER GRANTING DEFENDANT'S “RENEWED MOTION FOR
JUDGMENT AS A MATTER OF LAW, ” CONDITIONALLY GRANTING
DEFENDANT'S “MOTION FOR NEW TRIAL, ” AND
GRANTING IN PART AND DENYING IN PART DEFENDANT'S
“MOTION FOR RELIEF FROM JUDGMENT”
H. CLELAND UNITED STATES DISTRICT JUDGE.
Richard Graf Miller sues Defendants Michael Eric Joaquin and
Father and Sons Collectibles, Inc., (“Father and
Sons”) for breach of contract, common law conversion,
statutory conversion, and fraud. A trial was held on these
counts and the jury found in favor of Miller and against
Joaquin in the amount of $180, 000. (ECF No. 40,
PageID.391-93.) Joaquin moves for judgment nontwithstanding
the verdict (“JNOV”) and for a new trial. (ECF
Nos. 54, 45) Joaquin also moves for sanctions and relief from
judgment due to Miller's failure to sign answers to
interrogatories. (ECF No. 52.) All three motions have been
fully briefed. (ECF Nos. 51, 53, 57-60.) The court finds a
hearing unnecessary. E.D. Mich. L.R. 7.1(f)(2). For the
reasons provided below, the court will grant Joaquin's
motion for JNOV. A new trial will be conditionally granted.
Finally, Miller will be sanctioned for his failure to sign
answers to interrogatories.
was a coin collector who owned hundreds of gold and silver
coins. Miller considered selling some of his coins. In
February 2017, Miller met with Michael Joaquin of Father and
Sons Collectibles, Inc., to discuss the potential sale of at
least 256 coins. (ECF No. 47, PageID.493-94; ECF No. 42,
PageID.405.) The exact number of coins Miller offered is
and Joaquin entered into an oral agreement. Joaquin listed
the coins one by one on a sheet of paper. (ECF No. 42,
PageID.398-404.) The parties agreed that Joaquin would take
the coins and sell them to third parties, potentially at coin
shows. (ECF No. 47, PageID.546, 616-17.) Joaquin was to
obtain fair market value for the coins. (Id.,
PageID.547, 577.) For any sales, Miller would be entitled to
80% of the proceeds while Joaquin would have a right to 20%.
took possession of the coins and gave Miller a down payment
of $5, 000. (Id., PageID.577, 547, 579.) Joaquin
then sold the coins. (Id., PageID.620.) Joaquin
testified to receiving $18, 000 for the coins, mostly from
two companies, Eastern Numismatics and Numismatics Unlimited,
not from coin shows. (Id., PageID.620, 628.) Miller
and Joaquin dispute the amount of money Joaquin mailed to
Miller after the sale of the coins. (Id.,
PageID.605.) Joaquin claims he gave Miller a total of $15,
000 in four checks including the down payment. (Id.)
Three check stubs were introduced into evidence totaling $12,
000. (ECF No. 43, PageID.406-08.) Nonetheless, Miller
maintained he received only $11, 000. (ECF No. 47,
filed suit in federal court in May 2018 against both Joaquin
and Father and Sons. (ECF No. 1.) Miller alleged that
Joaquin's actions constituted fraud, statutory
conversion, common law conversion, breach of contract, and
unjust enrichment. (Id., PageID.4-8.) Miller sought
other equitable remedies as well. (Id.) A four-day
trial was held between May 27 and May 30, 2019. The jury
returned a verdict in favor of Miller on breach of contract,
common law conversion, statutory conversion, and fraud. (ECF
No. 40, PageID.391-93.) The jury found Joaquin personally
liable on all these claims and awarded Miller $180, 000.
(Id.) The jury marked on the verdict form that
Father and Sons was not liable for breach of contract, common
law conversion, and statutory conversion. (ECF No. 40,
PageID.391-92.) The jury did not mark whether Father and Sons
was liable for fraud on the verdict form, but the jury
foreman did announce only Joaquin liable, as he did for the
other claims, when rendering the verdict in court.
(Id.; ECF No. 48, PageID.732-33.)
Sixth Circuit, “a federal court sitting in diversity
must apply the standard for judgments as a matter of law of
the state whose substantive law governs.”
Lindenberg v. Jackson Nat'l Life Ins. Co., 912
F.3d 348, 360 (6th Cir. 2018) (quoting DXS, Inc. v.
Siemens Med. Sys., Inc., 100 F.3d 462, 468 (6th Cir.
1996)). Miller brought his suit under diversity jurisdiction.
(ECF No. 1, PageID.2, ¶ 4-5.) Miller's claims arise
under state law, the parties are diverse, and Miller alleged
an amount in controversy exceeding $75, 000 in good faith.
See Charvat v. GVN Michigan, Inc., 561 F.3d 623, 628
(6th Cir. 2009).
JNOV functions in a very similar way to the federal
system's judgment as a matter of law. See Fed.
R. Civ. P. 50(b); Ford v. County of Grand Traverse,
535 F.3d 483 (6th Cir. 2008). Under Michigan law, “a
party may move to have [a] verdict and judgment set aside,
and to have judgment entered in the moving party's
favor.” Mich. Ct. R. 2.610(A)(1). The court must
“examine the testimony and all legitimate inferences
that may be drawn in the light most favorable to the
plaintiff. If reasonable jurors could honestly have reached
different conclusions, the motion should be denied.”
Matras v. Amoco Oil Co., 424 Mich. 675, 681-82
(1986); see also Wiley v. Henry Ford Cottage Hosp.,
668 N.W.2d 402, 407 (Mich. Ct. App. 2003).
a diversity case, the question of whether a new trial is to
be granted is a federal procedural question and is to be
decided by reference to federal law.” J.C. Wyckoff
& Ass. V. Standard Fire Ins. Co., 936 F.2d 1474,
1487 n.20 (6th Cir. 1991) (quoting Toth v. Yoder
Co., 749 F.2d 1190, 1197 (6th Cir. 1984)).
Federal Rule of Civil Procedure 59(a) “[a] court may,
on motion, grant a new trial on all or some of the issues . .
. after a jury trial.” “[A] new trial is
warranted when a jury has reached a ‘seriously
erroneous result' as evidenced by: (1) the verdict being
against the weight of the evidence; (2) the damages being
excessive; or (3) the trial being unfair to the moving party
in some fashion, i.e., the proceedings being
influenced by prejudice or bias.” Holmes v. City of
Masillion, 78 F.3d 1041, 1045-46 (6th Cir. 1996)
(quoting Montgomery Ward & Co. v. Duncan, 311
U.S. 243, 251 (1940); CFE Racing Prods., Inc. v. BMF
Wheels, Inc., 793 F.3d 571, 584 (6th Cir. 2015).
moves for judgment as a matter of law and a new trial on
Joaquin's personal liability for breach of contract,
Joaquin's liability for conversion and fraud, and on the
extent of damages the jury awarded Miller. Joaquin's
motion for judgment as a matter of law will be construed as a
motion for JNOV under Michigan law. See Lindenberg,
912 F.3d at 360. Joaquin also seeks sanctions and relief from
judgment for Miller's failure to provide signed answers
to interrogatories. The court will address each issue in
Joaquin's Personal Liability for Breach of
agent who contracts with a third party on behalf of a
disclosed principal is generally not liable to the third
party in the absence of an express agreement to be held
liable.” Howard & Howard Attorneys P.L.L.C. v.
Jabbour, 880 N.W.2d 1, 1 (Mich. Ct. App. 2015) (citing
Nat'l Trout Festival, Inc. v. Cannon, 189 N.W.2d
69, 70-71 (Mich. Ct. App. 1971)). A principal is disclosed if
“a party transacting with the principal's agent has
notice that the agent is acting for the principal and notice
of the principal's identity.” Penton Pub., Inc.
v. Markey, 538 N.W.2d 104, 105 (Mich. Ct. App. 1995)
(citing Dodge v. Blood, 299 Mich. 364, 370 (1941)).
“A characteristic of an agent is that he is a business
representative. His function is to bring about, modify,
accept performance of, or terminate contractual obligations
between his principal and third persons, ” to the
extent that the principal provides an agent with authority to
do so. Uniprop, Inc. v. Morganroth, 678 N.W.2d 638,
641 (Mich. Ct. App. 2004).
the evidence is overwhelming that Joaquin was acting as an
agent to Father and Sons when he made an oral contract with
Miller to sell Miller's coins. Even drawing legitimate
inferences in favor of Miller, no reasonable juror could find
Joaquin personally liable for a breach of contract.
Matras, 424 Mich. at 681-82.
Miller was made aware of Joaquin's status as agent to
Father and Sons. The indexing of the coins at issue were
written, with the understanding and agreement of Miller, on
paper with the letterhead of Father and Sons. (ECF No. 42,
PageID.398-404; ECF No. 47, PageID.496, 544.) This list of
coins served as the initial basis of the contract. (ECF No.
47, PageID.496, 503, 545.) It listed the subject matter of
the contract, namely each coin Miller wished to sell, and
Joaquin's first attempt at providing a valuation for the
coins. (ECF No. 42, PageID.398-404.) Joaquin signed each page
at the bottom. (ECF No. 42, PageID.398-404.) Miller testified
that Joaquin made the list and presented it to Miller at the
time of their negotiations. (ECF No. 47, PageID.545.). In
fact, Miller stated that “the only list I went off of
[with regards to the coins at issue] was the one that
[Joaquin] provided me.” (Id.) If Miller was
not already aware of Joaquin's business relationship from
their contacts to arrange their in-person meeting in February
2017, Miller was certainly put on notice that Father and Sons
existed as an entity and that Joaquin was acting as agent for
Father and Sons. Markey, 538 N.W.2d at 105.
Henry Benjamin, a close confidant of Miller who was deeply
involved in the creation of the contract, observed that
Joaquin was acting as an agent of Father and Sons. Benjamin
hosted the negotiations, advising Miller and allowing the
contract discussions to take place in his office. (ECF No.
47, PageID.495.) Benjamin admitted that he “helped
negotiate the deal” and was “basically acting as
[Miller's] agent in [the] transaction.”
(Id., PageID.496, 507.) Given his extensive personal
experience with the contracting process, it is notable that
when asked what he “under[stood] the relationship [was]
between [Joaquin] and Father [and] Sons, ” Benjamin
responded that “[Joaquin] represented Father and
Sons.” (Id., PageID.505.)
all checks made payable to Miller for his coins were written
from Father and Sons, not Joaquin personally. (ECF No. 43,
PageID.406-08.) After negotiations in which major documents
were written on Father and Sons' paper and a
knowledgeable observer understood Joaquin to be representing
Father and Sons, it was Father and Sons who followed through
with payment. Michigan law recognizes that the parties'
course of performance can assist the court in interpreting a
contract. In cases where the terms of a contract are
ambiguous, “the practical interpretation given to [the]
contract by the parties . . . while engaged in their
performance and before any controversy has arisen concerning
them, is one of the best indications of their true
intent.” Klapp v. United Ins. Group Agency,
Inc., 468 Mich. 459, 479 (2003) (quoting People v.
Mich. Ctr. R. Co., 145 Mich. 140, 166 (1906)). Here, the
course of performance strongly supports the intent of Father
and Sons and Miller to be bound by the contract. Father and
Sons delivered the money to Miller. This money served as the
only real consideration in the agreement for Miller's
coins. In response, Miller read the check, understood its
significance, and accepted the money. (See ECF No.
47, PageID.546-47.) Significantly, this course of conduct
began only hours after the formation of the contract when
Joaquin provided Miller with a down payment of $5, 000, on a
Father and Sons' check. (ECF No. 43, PageID.406; ECF No.
47, PageID.577, 547, 579.)
Joaquin provided uncontradicted testimony that he was acting
on behalf of Father and Sons throughout the course of his
business interactions with Miller. Joaquin claimed at trial
that “all [his coin] business” is “[done]
through Father [and] Sons.” (ECF No. 47, PageID.593.).
In contrast, Miller has presented no evidence to contradict
Joaquin or to otherwise subject this testimony to doubt.
Miller himself never testified to any belief that he was
contracting personally with Joaquin. In fact, Miller was
asked about Father and Sons only once. Miller was ...