Minority member oppression; “Willfully unfair & oppressive conduct”; Franks v Franks; Michigan Limited Liability Company Act; MCL 450.1489(3); Michigan Business Corporation Act; MCL 450.4515(2); Family members’ employment; Indemnification; Good faith; MCL 450.1562

In this member oppression case, the court affirmed the trial court’s dismissal of plaintiff’s “claims of member and shareholder oppression against” defendant, her brother, related to the family business inherited from their father. Also, it found “that the trial court did not err by ruling that defendant is entitled to be indemnified for his attorney fees.” Plaintiff argued “that the trial court clearly erred by finding that defendant’s acts were not willfully unfair and oppressive.” The court concluded that plaintiff’s claim “that the trial court erred by treating the issue of oppression as a question of fact is misplaced.” It found that “the definition of oppression is a matter of law. However, this Court has recognized that the determination of whether ‘willfully unfair and oppressive conduct’ amounts to oppression involves a fact-intensive inquiry requiring an assessment of credibility and context.” It applied “the same oppression framework under both MCL 450.1489(3) and MCL 450.4515(2).” As to plaintiff’s claim “that defendant engaged in oppressive conduct when he employed members of his immediate family, specifically, his wife, as office manager, as well as two of his children,” the court found the record supported the trial court’s conclusions that so long as a “spouse is qualified, and so long as the spouse performs the labor contracted for, and so long as the compensation is reasonable, there is nothing inappropriate” about hiring a spouse. The record also supported its “findings that defendant’s employment of his family members did not constitute oppressive conduct in this case.” As to the two storage facilities, “the modest storage expense did not materially interfere with plaintiff’s interests as a shareholder, and accordingly, the trial court did not clearly err by finding that the storage arrangement did not constitute shareholder oppression.” It also “did not clearly err by finding that defendant’s accounting methods did not constitute oppressive conduct.” Further, the trial court correctly found “that the defendant was entitled to indemnification because the governing documents contain no requirement of a shareholder or member vote for indemnification, and the caselaw permits enforcement of bylaws and operating agreements as written.” Finally, the court determined that “defendant satisfied his statutory and contractual obligation of good faith, and the trial court did not err in this regard.”

Great weight of the evidence challenges to felony murder, armed robbery, FIP, & felony-firearm convictions; Credibility; Prosecutorial error; Vouching; Ineffective assistance of counsel; Failure to make a futile objection; Exclusion of a witness’s prior conviction; MRE 609(a); People v Snyder; People v Parcha

The court held that defendant’s felony murder, armed robbery, FIP, and felony-firearm convictions were not against the great weight of the evidence. It also rejected his prosecutorial error and ineffective assistance of counsel claims. Further, it concluded he was not entitled to relief based on the exclusion of a witness’s prior conviction from evidence. As to his great weight of the evidence claim, he essentially asked the court to find that his version of events was more credible than the prosecution’s evidence. But conflicting “‘testimony, even when impeached to some extent, is an insufficient ground for granting a new trial.’” Defendant asserted that witness-W’s “testimony was ‘inherently incredible’ because [W]: (1) was the person responsible for stopping the DVR recording before the shooting, (2) hid the cameras and DVR before the police arrived, and (3) was seen pacing at the scene after officers arrived. First, there was no evidence that [W] was the person who stopped the recording before the shooting. In fact, [W] was in the video frame when the cameras cut out, and defendant was not. Second, [W] testified that he did not take the cameras down or move the DVR until after the shooting occurred, and he only moved them at that point because he was afraid that someone would return for the equipment.” As to the pacing, “that behavior does not appear to be particularly suspicious considering that the evening was described as cold and snowy, and [W] had just witnessed the murder of a person who was ‘just like family’ to him.” The court found it “worth noting that defendant fled the scene, but” W flagged down a police officer and another witness (C) “called emergency services and rendered aid to the victim. And even though [W] and [C] were hesitant to testify, their testimonies substantially corroborated each other. Accordingly, despite the presence of conflicting testimony in this case, the evidence did not preponderate so heavily against the jury’s verdict that it would be a miscarriage of justice to allow the verdict to stand.” The court also found that the prosecution did not improperly vouch for W’s and C’s testimonies in closing argument. As to the exclusion of W’s prior conviction, defendant could not show prejudice in any event given the overwhelming evidence of his guilt. Affirmed.

Motion to quash bindover on a charge of operating a vehicle while intoxicated (OWI) causing death; MCL 257.625(4)(a)

In this interlocutory appeal, the court affirmed the circuit court’s order denying defendant’s motion to quash his bindover on a charge of OWI causing death. He challenged “only that he was under the influence of intoxicating substances.” The evidence appeared “greater than ‘mere speculation’ such that ‘a person of ordinary prudence and caution’ could infer probable cause that defendant was intoxicated, which caused him to cross the center line.” His competing evidence established “a conflict that ‘raises a reasonable doubt’ such that the district court properly bound over defendant ‘for resolution of the issue by the trier of fact.’” The court held that given “that the threshold for a district court abusing its discretion is limited to errors of law or a decision that falls ‘outside the range of reasonable and principled outcomes,’ the district court’s decision to bind over defendant for trial on this substantial, though conflicting, evidence about whether [he] was under the influence during the collision was not an abuse of discretion.”

Standing to enforce deed restrictions; Comparing Civic Ass’n of Hammond Lake Estates v Hammond Lake Estates No 3 Lots 126-135 & Bloomfield Estates Improvement Ass’n, Inc v City of Birmingham; Deed Restriction Article II preapproval requirement; Restrictive-covenant interpretation; Thiel v Goyings; Article VI reasonable-promptness clause; MCR 1.109(E)(6) sanctions

The court held that the trial court erred by concluding defendants did not “alter” their home within the meaning of the deed restrictions when they installed cedar siding without plaintiff’s prior approval, requiring partial vacatur and remand. But the trial court properly granted summary disposition on all remaining claims and counterclaims. The case arose after defendants replaced deteriorated stucco on the street-facing portion of their Tudor-style home with cedar without first submitting plans to plaintiff, the subdivision’s civic association. Defendants stopped work when notified and later removed the cedar during litigation. The trial court dismissed plaintiff’s enforcement action and defendants’ counterclaims. On appeal, the court first found that plaintiff had standing because an association may enforce deed restrictions on behalf of its members, citing Hammond Lake Estates and noting that Bloomfield Estates did not disturb that principle. On the merits, the court held that installing bright cedar siding in place of stucco significantly changed the home’s character and composition, constituted an “alteration,” and therefore required preapproval under Article II. It rejected the trial court’s reasoning that the small portion at issue and its removable nature negated an alteration, noting that the change “significantly” departed from the Tudor appearance. The court emphasized that defendants’ later removal of the siding did not moot the violation. As to Article II’s conformity-and-harmony clause, it affirmed dismissal because that clause governs the association’s review process, and defendants did not challenge the association’s review determinations. Regarding Article VI, the court found no violation of the “reasonable promptness” requirement because defendants ceased work after receiving a cease-and-desist and awaiting approval, and removal-time arguments were outside the clause’s focus on carrying forward construction. It also rejected the argument that woodpecker damage was a “casualty” requiring repair within four months, explaining that “casualty” in context refers to accidental events similar to fire, not gradual deterioration. The court affirmed dismissal of plaintiff’s contract and fraud counts, finding no enforceable contract because the plan-review form lacked mutuality, consideration, and any binding obligation before approval. And in the absence of a contract, the fraud claim had no merit. The court also upheld the denial of sanctions, concluding nothing showed defendants’ attorney failed to conduct a reasonable inquiry before filing the counterclaims. Remanded solely for the trial court to determine appropriate remedies for the Article II preapproval violation.

Involuntary dismissal; Whether a party was entitled to enforce an easement agreement; Distinguishing Conlin v Upton; Standing for a fiduciary duty claim; Presentation of an issue

The court held that the trial court did not err in granting involuntary dismissal to appellee-Moorings. Also, appellant-Harbor Isles failed to show an error in the trial court’s determination that Harbor Isles did not show what fiduciary duty appellee-Gould owed to Harbor Isles. This civil action arose “from a business dispute between Harbor Isles, which operates a private marina, and three” condo associations that own and manage boat slips in the marina—Moorings and appellees-SJIYC and Dane’s Landing. As to the involuntary dismissal, the court found that “while Harbor Isles’ evidence may have shown that [it] possessed whatever rights or interests in the property” a predecessor (Mikler Harbor) had, “it did not establish what the nature and scope of those legal rights or interests were—namely, that Mikler Harbor was” another nonparty’s “successor or assign such that Harbor Isles necessarily assumed that status through the quitclaim deed and could enforce the Moorings rec agreement as a result.” The court concluded that “nothing in Conlin—or any other authority identified by Harbor Isles—suggests that Harbor Isles can enforce and benefit from a covenant that runs with that property without proving the chain of title to the property through which it, in fact, received that claimed right.” Harbor Isles next argued “that it was improperly prevented from providing proof of title at the bench trial through the testimony of its representative[.]” However, the record did “not bear out this claim.” Harbor Isles failed to show “any error by the trial court in its handling of Harbor Isles’ proofs on this point at trial or its assessment of their adequacy.” The court turned “next to Harbor Isles’ challenge to the trial court’s grant of summary disposition” for Gould. The court agreed “with the trial court’s conclusion that Harbor Isles has failed to adequately plead or otherwise demonstrate the existence of a fiduciary relationship between it and Gould.” Thus, it held that Gould was correctly granted “summary disposition on Harbor Isles’ claim of breach of fiduciary duty. Even looking past the preservation and presentation issues in Harbor Isles’ arguments on appeal,” it failed to adequately plead or show “that Gould owed a fiduciary duty to Harbor Isles with respect to any of the allegations Harbor Isles has raised against him.” Lastly, as to the trial court’s grant of summary disposition for SJIYC, Harbor Isles offered no reason why the court should overlook a “significant deficiency in its presentation of the issue on appeal, and” it declined to do so. Affirmed.

Standing to enforce deed restrictions; Comparing Civic Ass’n of Hammond Lake Estates v Hammond Lake Estates No 3 Lots 126-135 & Bloomfield Estates Improvement Ass’n, Inc v City of Birmingham; Deed Restriction Article II preapproval requirement; Restrictive-covenant interpretation; Thiel v Goyings; Article VI reasonable-promptness clause; MCR 1.109(E)(6) sanctions

The court held that the trial court erred by concluding defendants did not “alter” their home within the meaning of the deed restrictions when they installed cedar siding without plaintiff’s prior approval, requiring partial vacatur and remand. But the trial court properly granted summary disposition on all remaining claims and counterclaims. The case arose after defendants replaced deteriorated stucco on the street-facing portion of their Tudor-style home with cedar without first submitting plans to plaintiff, the subdivision’s civic association. Defendants stopped work when notified and later removed the cedar during litigation. The trial court dismissed plaintiff’s enforcement action and defendants’ counterclaims. On appeal, the court first found that plaintiff had standing because an association may enforce deed restrictions on behalf of its members, citing Hammond Lake Estates and noting that Bloomfield Estates did not disturb that principle. On the merits, the court held that installing bright cedar siding in place of stucco significantly changed the home’s character and composition, constituted an “alteration,” and therefore required preapproval under Article II. It rejected the trial court’s reasoning that the small portion at issue and its removable nature negated an alteration, noting that the change “significantly” departed from the Tudor appearance. The court emphasized that defendants’ later removal of the siding did not moot the violation. As to Article II’s conformity-and-harmony clause, it affirmed dismissal because that clause governs the association’s review process, and defendants did not challenge the association’s review determinations. Regarding Article VI, the court found no violation of the “reasonable promptness” requirement because defendants ceased work after receiving a cease-and-desist and awaiting approval, and removal-time arguments were outside the clause’s focus on carrying forward construction. It also rejected the argument that woodpecker damage was a “casualty” requiring repair within four months, explaining that “casualty” in context refers to accidental events similar to fire, not gradual deterioration. The court affirmed dismissal of plaintiff’s contract and fraud counts, finding no enforceable contract because the plan-review form lacked mutuality, consideration, and any binding obligation before approval. And in the absence of a contract, the fraud claim had no merit. The court also upheld the denial of sanctions, concluding nothing showed defendants’ attorney failed to conduct a reasonable inquiry before filing the counterclaims. Remanded solely for the trial court to determine appropriate remedies for the Article II preapproval violation.

Involuntary dismissal; Whether a party was entitled to enforce an easement agreement; Distinguishing Conlin v Upton; Standing for a fiduciary duty claim; Presentation of an issue

The court held that the trial court did not err in granting involuntary dismissal to appellee-Moorings. Also, appellant-Harbor Isles failed to show an error in the trial court’s determination that Harbor Isles did not show what fiduciary duty appellee-Gould owed to Harbor Isles. This civil action arose “from a business dispute between Harbor Isles, which operates a private marina, and three” condo associations that own and manage boat slips in the marina—Moorings and appellees-SJIYC and Dane’s Landing. As to the involuntary dismissal, the court found that “while Harbor Isles’ evidence may have shown that [it] possessed whatever rights or interests in the property” a predecessor (Mikler Harbor) had, “it did not establish what the nature and scope of those legal rights or interests were—namely, that Mikler Harbor was” another nonparty’s “successor or assign such that Harbor Isles necessarily assumed that status through the quitclaim deed and could enforce the Moorings rec agreement as a result.” The court concluded that “nothing in Conlin—or any other authority identified by Harbor Isles—suggests that Harbor Isles can enforce and benefit from a covenant that runs with that property without proving the chain of title to the property through which it, in fact, received that claimed right.” Harbor Isles next argued “that it was improperly prevented from providing proof of title at the bench trial through the testimony of its representative[.]” However, the record did “not bear out this claim.” Harbor Isles failed to show “any error by the trial court in its handling of Harbor Isles’ proofs on this point at trial or its assessment of their adequacy.” The court turned “next to Harbor Isles’ challenge to the trial court’s grant of summary disposition” for Gould. The court agreed “with the trial court’s conclusion that Harbor Isles has failed to adequately plead or otherwise demonstrate the existence of a fiduciary relationship between it and Gould.” Thus, it held that Gould was correctly granted “summary disposition on Harbor Isles’ claim of breach of fiduciary duty. Even looking past the preservation and presentation issues in Harbor Isles’ arguments on appeal,” it failed to adequately plead or show “that Gould owed a fiduciary duty to Harbor Isles with respect to any of the allegations Harbor Isles has raised against him.” Lastly, as to the trial court’s grant of summary disposition for SJIYC, Harbor Isles offered no reason why the court should overlook a “significant deficiency in its presentation of the issue on appeal, and” it declined to do so. Affirmed.