One Court of Justice

On April 13, 2010, the Michigan Court of Appeals issued for publication a per curiam opinion in Duray Development, LLC v. Perrin, No. 287722, holding that, under the de facto corporation doctrine, Outlaw LLC, and not its owner Perrin, was bound by the contract with Duray.  It therefore reversed the trial court’s judgment against Perrin.  The Court also reviewed the trial court’s failure to sua sponte raise the issue of corporation by estoppel but found no plain error.  Finally, the Court reversed the trial court’s decision to sanction defendants for not timely filing a witness list by precluding them from offering Perrin as a witness at trial.  The trial court should have first considered all relevant factors and other sanction options before exercising its discretion to enter such a heavy sanction. Read more »

On September 8, 2009, the Court of Appeals published an opinion in Flint Cold Storage v. Michigan Department of Treasury, No. 286921, in a decision written by Judge Jansen.  The Court affirmed a grant of summary disposition to the Treasury Department on the basis that Flint Cold Storage lacked capacity to sue, and therefore could not maintain an action to recover unclaimed property held by the Treasury.  The opinion can be found here. Read more »

On September 8, 2009, the Court of Appeals published its opinion in Innovative Adult Foster Care, Inc. v. Ragin, reversing the circuit court’s grant of summary disposition in favor of defendants, John and Mary Ragin, on Innovative Adult Foster Care’s (“Innovative”) declaratory-judgment action for the purpose of resolving which of two competing factions had lawful control of Innovative’s board of directors.  The court determined that a sufficiently detailed affidavit and one corporate filing listing additional directors created a genuine issue of material fact as to the size and membership of the board. 

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On August 4, 2009, the Court of Appeals published its opinion in Alliance Obstetrics & Gynecology v. Department of Treasury, affirming the Court of Claims’ determination that Alliance Obstetrics & Gynecology (“Alliance”), a Michigan limited liability company, is not to be treated as a corporation for purposes of calculating the small business tax credit.  The court also held that the income limitations in MCL 208.36(2) do not disqualify Alliance from claiming the credit.  The  court held that Alliance is entitled to receive the small business tax credit, despite Alliance’s election to be treated as a corporation for federal income tax purposes.  Read more »

On July 28, 2009. the Michigan Court of Appeals published an opinion in TMW Enterprises Inc. v. Department of Treasury, No. 284446, holding that an S corporation is a “corporation” within the meaning of section 3(3) of the Single Business Tax Act (SBTA), MCL 208.3(3), and therefore not entitled to the casual-transaction exclusion provided to persons “other than a corporation” in MCL 208.3(2).  Read more »

On May 1, 2009, the Michigan Supreme Court:

• denied seven applications for leave to appeal;
• denied a prisoner’s motion to waive filing fees;
• ordered supplemental briefing and a mini-oral argument (MOA) on the application for leave filed in Loos v. J.B. Installed Sales, INc., Case No. 137987, a case involving application of the statutory factors enumerated in MCL 418.161(1)(n) for determining when a person is an “employee” for purposes of the Worker’s Disability Compensation Act (the Court of Appeals opinion can be found here);
• ordered supplemental briefing and an MOA on the application for leave filed in People v. Hoch, Case No. 137908, a case involving a trial court’s decision to respond to a note from the jury, off the record and in the absence of defendant or his counsel (the Court of Appeals opinion can be found here);
• reversed the Court of Appeals’ decision in Consumers Energy Co. v. Acey, Case No. 137425, holding the plaintiff bound to its stipulation in the trial court regarding the width of an easement;
• issued a summary decision in Attorney General v. Michigan Public Service Commission, Case Nos. 136431 and 134676, holding that (1)  ”transmission costs” may be recovered through a power supply cost recovery clause, and (2) Detroit Edison Company could not recover a portion of the control premium that DTE Energy paid to acquire MCN Energy  (our previous post on these cases can be found here); and
• on reconsideration, vacated its previous summary order and granted the application for leave to appeal in Davis v. Forest River, Inc., Case No. 136114, a case involving a party’s ability to assert the remedy of rescission in an implied warranty action under the UCC against an out-of-privity seller (the Court’s previous order can be found here).

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On March 18, 2009, the Michigan Supreme Court denied seven applications for leave to appeal, held three criminal cases in abeyance until a decision is rendered in People v. Idziak, and denied one motion for a waiver of fees in a prisoner civil action against the Michigan Department of Corrections. The Court also took substantive action in one civil and one criminal case.  These cases are discussed after the jump.

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On February 3, 2009, the COA issued an opinion in Green, Hendrickson, Esper, and Libwag, LLC v. Ziegelman, Ziegelman Architects, Inc., and Continental Construction Co., No. 280624, holding that plaintiffs may not use a proceeding supplementary to judgment to pierce the corporate veil of the corporate defendant.  The Court left open the question of whether the plaintiffs could file a new and separate action against Ziegelman, or whether such action would be barred by the doctrine of res judicata or the compulsory joinder rule.  Read more »

In a published decision issued December 18, 2008, the COA held that, without regard to the underlying basis for the claim of liability, the law of the jurisdiction in which a limited partnership is organized controls the resolution of a limited partner’s liability.  Atlantic XXXI LLC v ART Midwest LLP.  You can find a copy of the opinion here.