Lima Township v. Estate of Ernest K Bateson ( 2019 )

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
LIMA TOWNSHIP, UNPUBLISHED
December 19, 2019
Plaintiff-Appellant,
v No. 344007
Washtenaw Circuit Court
PAMELA BATESON, as personal representative LC No. 10-000368-CZ
of the ESTATE OF ERNEST K. BATESON, and
individually, a/k/a PAMELA E. GOUGH-
BAHASH,
Defendant-Appellee.
LIMA TOWNSHIP,
Plaintiff-Appellee,
v No. 345835
Washtenaw Circuit Court
PAMELA BATESON, as personal representative LC No. 10-000368-CZ
of the ESTATE OF ERNEST K. BATESON, and
individually, a/k/a PAMELA E. GOUGH-
BAHASH,
Defendant-Appellant.
Before: LETICA, P.J., and GADOLA and CAMERON, JJ.
PER CURIAM.
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In these consolidated appeals,1 plaintiff Lima Township (the Township) appeals as of
right the order of the trial court awarding the Township costs and fees. Defendant Pamela
Bateson a/k/a Pamela E. Gough-Bahash, individually and as personal representative of the Estate
of Ernest K. Bateson (the Batesons),2 appeals upon delayed leave granted3 the order of the trial
court finding that the Batesons asserted a frivolous defense. We affirm the order of the trial
court finding the Batesons’ defense frivolous and remand to the trial court for imposition of
reasonable costs and attorney fees.
I. FACTS
These appeals involve costs and attorney fees incurred by the Township while
prosecuting this action against the Batesons. By way of background, in 2009 Pamela Bateson
purchased 30 acres in Lima Township at 8786 West Liberty Road. The property was zoned AG-
1 (agricultural) under the Lima Township Zoning Ordinance. The Township thereafter initiated
this action in the trial court alleging that the Batesons were operating a commercial contractor’s
business or storage yard on the property, uses not permitted in an agricultural zone.
The dispute between the Batesons and Lima Township, however, predates the 2009
purchase of the property. In an opinion in an earlier appeal in this case, this Court summarized
the background facts of the parties’ dispute:
In its original complaint, Lima Township alleged that Bateson had already
been sued for violating zoning ordinances with regard to another property at 7970
West Liberty Road where he operated a business involving the commercial
production and sale of topsoil and landscaping materials. It further alleged that,
after the trial court in that case ordered the barricading of that property, Bateson
moved his commercial equipment and vehicles to the property involved in this
case [8786 West Liberty Road] and began to operate his business from there. It
alleged that the operation of a commercial contractor’s establishment or storage
yard, the operation of a commercial business, and the storing and staging of the
commercial trucks, equipment, and landscaping materials were not permitted uses
1
The appeals were consolidated on this Court’s own motion. Lima Twp v Estate of Ernest K.
Bateson, unpublished order of the Court of Appeals, entered March 18, 2019 (Docket No.
345835).
2
Ernest Bateson died in August 2018, and Pamela Bateson was appointed personal
representative of Bateson’s estate. This Court granted defendants’ motions for substitution of
parties in both appeals, substituting Pamela Bateson as personal representative of the Estate of
Ernest K. Bateson in place of Ernest K. Batson. Lima Twp v Estate of Ernest K. Bateson,
unpublished order of the Court of Appeals, entered December 20, 2018 (Docket No. 344007);
Lima Twp v Estate of Ernest K. Bateson, unpublished order of the Court of Appeals, entered
December 20, 2018 (Docket No. 345835).
3
Lima Twp v Estate of Ernest K. Bateson, unpublished order of the Court of Appeals, entered
March 18, 2019 (Docket No. 345835).
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for a lot zoned as an AG-1 District. It concluded that the unlawful uses amounted
to a nuisance and asked the trial court to abate the nuisance. Lima Township later
amended its complaint to include allegations that Bateson and Gough were
removing soils and material from the property without obtaining a special use
permit as required by its zoning ordinances.
It was undisputed that the property commonly known as 8786 West
Liberty Road was zoned as an AG-1 District under Lima Township’s zoning
ordinance. The zoning ordinances permitted various uses, which included, in
relevant part, “[a]gricultural uses and customary farm accessory buildings,
including apiaries and green houses,” “[r]oadside stands selling seasonal farm
produce,” “single-family dwelling,” “[t]ree, sod farm,” “[f]ertilizer sales, feed or
seed sales,” and “[s]tructures or roads for the development, protection and
conservation or open space, watersheds, water, soil, forest and wildlife
resources.” Lima Township Zoning Ordinances (Zoning Ord), §4.5.2, 4-11. The
term “agriculture” was further defined to mean the “use of land for tilling of the
soil, the raising of tree and field crops, or raising animals as a source of income.”
Zoning Ord, §2.2, 2-2.
The ordinance did not permit the storage or staging of commercial
vehicles and equipment for a commercial operation in a district zoned AG-1. The
ordinances did allow a landowner in a district zoned AG-1 to conduct the “off
premise storage of service vehicles” and permitted “[q]uarries, mineral mining,
sand and gravel pits, soil removal and other extractive excavations” as special
uses. Zoning Ord, §4.5.2, 4-12. However, a landowner or occupier had to obtain
a permit for those special uses. See, generally, Zoning Ord, §3.3; see also Zoning
Ord, §5.27.2, 5-35 (requiring a permit for quarry or extractive operation).
Notably, the ordinances provide that a “quarry” means any “pit, excavation or
mining operation for the purpose of removal of excavated material such as earth,
topsoil, sand, aggregate, clay or stone, for sale, transportation, exchange or barter,
away from the premises.” Zoning Ord, §2.2, 2-21.
In response to Lima Township’s complaints, Bateson and Gough claimed
that they were conducting a tree farm and nursery on the property and that all the
equipment and vehicles were being used to prepare the land for the tree farm and
to conduct tree farming operations. They further claimed that, to the extent that
their storage and use of the equipment and vehicles were prohibited by Lima
Township’s zoning ordinances, those ordinances were preempted by the Right to
Farm Act. [Lima Twp v Bateson, unpublished per curiam opinion of the Court of
Appeals, issued October 11, 2018 (Docket No. 338934), p 2.]
The Batesons filed an answer to the Township’s complaint, asserting as affirmative
defenses that their activities were protected under Michigan’s Right to Farm Act, MCL 286.471
et seq., and that the activities were agricultural and therefore permitted on property zoned AG-1.
Both parties moved for summary disposition of the Township’s complaint. After an evidentiary
hearing, the trial court granted the Township’s motion for summary disposition and also granted
the Township injunctive relief. Lima Twp v Bateson, 302 Mich. App. 483, 491; 838 NW2d 898
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(2013). The Batesons appealed to this Court, which determined that the trial court had erred in
several respects and remanded to the trial court for findings of fact to support the award of
injunctive relief and to correct an evidentiary error. See id. at 504.
On remand, the trial court held a further evidentiary hearing and entered a final order
determining that the Batesons’ use of the property was not protected under the Right to Farm Act
and abating the nuisance. The Batesons again appealed to this Court, which affirmed the trial
court’s decision. See Lima Twp v Bateson, unpub op at 1, 7.
The Township thereafter brought a motion in the trial court for costs and attorney fees
under MCL 600.2591, contending that the Batesons’ defense under the Right to Farm Act was
frivolous because the Batesons had no reasonable basis to believe that the facts in this case
justified a defense under that act. The trial court entered an order finding that the Batesons’
assertion of a defense under the Right to Farm Act was frivolous. The trial court then held a
hearing to determine the reasonable costs and fees to be awarded to the Township, and afterward
entered an order awarding costs and fees to the Township in the amount of $14,555.85. The
Township now appeals as of right the order of the trial court granting costs and fees, and the
Batesons appeal on delayed leave granted the order of the trial court determining that their
defense under the Right to Farm Act was frivolous.
II. DISCUSSION
A. THE RIGHT TO FARM ACT
The Batesons contend that the trial court erred in finding that their assertion of a defense
under the Right to Farm Act was frivolous. We disagree.
The trial court’s finding that a party’s claim or defense is frivolous is a factual finding
that this Court may not set aside unless it is clearly erroneous. Kitchen v Kitchen, 465 Mich. 654,
661; 641 NW2d 245 (2002). A finding is clearly erroneous when, although there is evidence to
support it, this Court is left with a definite and firm conviction that the trial court made a
mistake. Id. at 661-662.
In Michigan, attorney fees generally are not recoverable from the losing party as costs
absent a statute or court rule expressly authorizing the trial court to impose such sanctions.
Haliw v Sterling Hts, 471 Mich. 700, 706-707; 691 NW2d 753 (2005). MCL 600.2591, however,
not only authorizes the imposition of attorney fees and costs, it requires a court to sanction an
attorney or party that files a frivolous action or defense. Meisner Law Group PC v Weston
Downs Condo Ass’n, 321 Mich. App. 702, 731; 909 NW2d 890 (2017). The purpose of imposing
sanctions for asserting a frivolous claim or defense is to deter parties and their attorneys from
asserting claims and defenses without sufficient investigation or to serve an improper purpose.
Id. at 731-732. MCL 600.2591 provides as follows:
(1) Upon motion of any party, if a court finds that a civil action or defense to a
civil action was frivolous, the court that conducts the civil action shall award to
the prevailing party the costs and fees incurred by that party in connection with
the civil action by assessing the costs and fees against the nonprevailing party and
their attorney.
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(2) The amount of costs and fees awarded under this section shall include all
reasonable costs actually incurred by the prevailing party and any costs allowed
by law or by court rule, including court costs and reasonable attorney fees.
(3) As used in this section:
(a) “Frivolous” means that at least 1 of the following conditions is met:
(i) The party’s primary purpose in initiating the action or asserting the defense
was to harass, embarrass, or injure the prevailing party.
(ii) The party had no reasonable basis to believe that the facts underlying that
party’s legal position were in fact true.
(iii) The party’s legal position was devoid of arguable legal merit.
(b) “Prevailing party” means the party who wins on the entire record.
Whether a claim or a defense is frivolous within the meaning of MCL 600.2591 depends
upon the facts of each case, Kitchen, 465 Mich. at 662, and requires the evaluation of the claims
and defenses at the time they were asserted and in the context of the facts of that case. DC Mex
Holdings LLC v Affordable Land LLC, 320 Mich. App. 528, 548; 907 NW2d 611 (2017). The
mere fact that a party does not prevail does not establish that the claim or defense asserted was
frivolous. Kitchen, 465 Mich. at 662. If a party has advanced a defense sufficiently grounded in
fact and law, a finding that the defense is frivolous is not warranted. Id. at 664. On the other
hand, if a claim or defense is not sufficiently grounded in law or fact, it is devoid of arguable
legal merit and is frivolous. Adamo Demolition Co v Dep’t of Treasury, 303 Mich. App. 356, 369;
844 NW2d 143 (2013).
The Batesons argue that they presented evidence that they were operating a tree farm on
the property sufficient to demonstrate that the defense asserted under the Right to Farm Act was
not frivolous. Although a tree farm potentially is a protected farming activity under the Act if
the activities comply with the requirements of the Act, see Lima Twp, 302 Mich. App. at 498, the
Batesons in this case presented scant evidence of a tree farm on the property in question.
Although they planted approximately 600 small trees on the property, and there was testimony
that some of the equipment stored on the property was consistent with farming, the
overwhelming evidence supports a finding that the Batesons were not operating a tree farm, but
were instead operating an excavation and gravel business. This Court previously summarized
the evidence that indicated that the Batesons were not operating a farm:
There was evidence that Bateson had been engaged in the commercial production
and sale of landscaping materials and that he provided contractor services related
to landscaping. Bateson testified that he was in the business of contracting and
supplying landscaping materials. Gough similarly said that Bateson was in the
“dirt business” and dug ponds as a sideline. After Gough purchased 8786 West
Liberty Road, Bateson began moving commercial equipment and vehicles to the
property.
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There was photo evidence and testimony that Bateson improved the
driveway, created additional access roads around the pond and to the north end of
the property, dredged the pond, and created a parking area. Bateson and Gough
claimed that the driveway improvements, alterations to the pond, and the creation
of a parking area – characterized as the farm market area by Bateson – were
necessary to prepare the property for a tree farm. But those improvements were
also consistent with the use of the property as a storage and staging area for
Bateson’s commercial business and as an area for the commercial extraction and
processing of landscaping aggregates. . . . The scale and nature of the
improvements suggested that Bateson and Gough made and used the
improvements to support Bateson’s commercial landscaping business rather than
for establishing a tree farm or other farm operation.
The photo evidence showed that the driveway, parking area, and
additional roads were all located well beyond the area where Bateson and Gough
planted trees. The additional access roads also appeared to facilitate the
extraction, storage, and processing of landscaping materials; they did not appear
consistent with any ordinary farming practices. The size of the parking area –
described by [a witness] as half a football field in length – was also inconsistent
with the small tree farm that the property could support. It was, however, well
adapted to store equipment and vehicles for a commercial landscaping business.
The improvements of the driveway also plainly aided the ingress and egress of the
heavy commercial vehicles actually operating from the property. Similarly,
although Bateson and Gough described the pond as an irrigation pond, Gough in
effect testified that the pond was not suited to irrigate the trees planted on the
front acreage. That, she explained, was why she wanted Bateson to construct
another pond in the wetlands nearer to the trees that they had planted. Moreover,
the removal of nutrient rich soil from the pond – and any future pond created in
the wetlands – was consistent with supporting Bateson’s landscaping business
because it provided him with more materials for sale to the general public. Thus,
although the improvements could in theory have been done to develop the
property as a tree farm, the improvements were also consistent with and perhaps
better suited to – the use of the property as a staging and storage area for
Bateson’s landscaping business.
The equipment and vehicles actually kept on the property, when
considered as a whole, also strongly suggested that Bateson and Gough were not
actually using them to operate a tree farm, or any other type of farm. The number
and types of vehicles and equipment were consistent with Bateson’s landscaping
business, but were not well suited to a small tree farm operation. Bateson pointed
to the fact that some farm owners in the vicinity had one or more vehicles or
pieces of equipment on their farms that were similar to his equipment and
machinery. But there was no evidence at the evidentiary hearing than any farm
used or stored a comparable number of vehicles and equipment so specialized for
landscaping and soil extraction and blending, and did so for such a modest
acreage.
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***
There was also testimony, photos, and logs that showed that trucks and
equipment frequently traveled to and from the property. Three neighboring
farmers . . . each agreed that about 500 trucks left the property at issue over the
course of the summer before the evidentiary hearing. The testimony and evidence
documenting the truck traffic showed that some trucks left full and came back
empty, and on other occasions came back with aggregates and dumped them on
the property. . . . [T]he scale of the documented comings and goings of trucks and
heavy equipment strongly implied that the vehicles and equipment were being
used in furtherance of Batson’s commercial landscaping business. [Lima Twp v
Bateson, unpub op at 4-5 (footnote omitted).]
The trial court concluded that the removal of materials from the property and the storage
and use of commercial equipment on the property indicated by the evidence “have nothing to do
with the farming of trees, and show that Bateson and Gough are actually engaged in a gravel
hauling operation.” This Court affirmed the trial court’s decision. See Lima Twp v Bateson,
unpub op at 7.
At the hearing on the motion to find the defense frivolous, the trial court stated that it
found the defense to be frivolous but attributed the blame to Mr. Bateson rather than the
Batesons’ attorney, noting that Mr. Bateson’s assertions were not credible and were done for the
purpose of harassing and annoying rather than for the legitimate resolution of the dispute. Again
during the hearing on the reasonableness of the costs and fees, the trial court observed that the
assertion of a defense under the Right to Farm Act had no basis in the facts of this case.
The mere fact that the Batesons did not prevail in establishing their defense under the
Right to Farm Act does not establish that their defense was frivolous. Kitchen, 465 Mich. at 662.
Rather, determining whether the assertion of a defense was frivolous involves evaluating the
defense in the context of the facts at the time the defense was asserted. DC Mex Holdings LLC,
320 Mich. App. at 548. Here, the overwhelming evidence demonstrates that the Batesons were
never operating a tree farm, and from the outset were instead operating an excavation and gravel
business. Their assertion of a defense under the Right to Farm Act was thus devoid of arguable
legal merit. Applying the deferential standard of review of clear error, nothing in the Batesons’
argument demonstrates that the trial court’s factual finding of frivolousness should be set aside.
Because the trial court’s finding has sufficient evidentiary support, we are not left with a definite
and firm conviction that a mistake was made, and find no error in the trial court’s determination
that the defense was frivolous. See Pioneer State Mut Ins Co v Michalek, ___ Mich App ___,
___; ___ NW2d ___ (2019) (Docket No. 344577); slip op at 3-4.
B. REASONABLE COSTS AND FEES
Lima Township contends that although the trial court correctly determined that the
Batesons’ defense under the Right to Farm Act was frivolous, the trial court erred by entering an
order for costs and fees against the Batesons but not against the Batesons’ attorney, and also
erred in awarding only costs and fees incurred by the Township in the trial court after entry of
the final order. We agree.
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We review a trial court’s decision on a motion for costs and attorney fees for an abuse of
discretion. Keinz v Keinz, 290 Mich. App. 137, 141; 799 NW2d 576 (2010). We also review for
an abuse of discretion the reasonableness of the trial court’s award of attorney fees and costs.
Smith v Khouri, 481 Mich. 519, 526; 751 NW2d 472 (2008). The trial court abuses its discretion
when its decision falls outside the range of principled outcomes. Id.
Again, MCL 600.2591 provides, in relevant part:
(1) Upon motion of any party, if a court finds that a civil action or defense to a
civil action was frivolous, the court that conducts the civil action shall award to
the prevailing party the costs and fees incurred by that party in connection
with the civil action by assessing the costs and fees against the nonprevailing
party and their attorney.
(2) The amount of costs and fees awarded under this section shall include all
reasonable costs actually incurred by the prevailing party and any costs
allowed by law or by court rule, including court costs and reasonable
attorney fees. [Emphasis added.]
The Legislature’s use of the word “shall” in a statute indicates that the directive is
mandatory, not discretionary. Smitter v Thornapple Twp, 494 Mich. 121, 136; 833 NW2d 875
(2013). Thus, the language of MCL 600.2591 requires a court to sanction an attorney or party
who asserts a frivolous action or defense. Meisner Law Group PC, 321 Mich. App. at 731.
Because the trial court in this case found that the defense asserted under the Right to Farm Act
was frivolous under MCL 600.2591, the trial court was required under the statute to award “all
reasonable costs actually incurred by that party in connection with the civil action,” and those
costs include reasonable attorney fees. MCL 600.2591; Travelers Ins v U-Haul of Mich, Inc, 235
Mich. App. 273, 289-290; 597 NW2d 235 (1999). Because the sanctions are mandatory under
MCL 600.2591, the trial court did not have discretion to forego their imposition. Cvengros v
Farm Bureau Ins, 216 Mich. App. 261, 268; 548 NW2d 698 (1996). The trial court therefore
abused its discretion by failing to determine and award all reasonable costs incurred by the
Township in connection with the action, including reasonable attorney fees.
The burden of proving the reasonableness of fees is upon the party requesting the fees.
Smith, 481 Mich. at 528-529. When determining the reasonableness of a requested fee, the trial
court should consider the “totality of special circumstances applicable to the case at hand.” Id. at
529; Michalek, ___ Mich App at ___, slip op at 4. In this case, after finding that the Batesons’
defense under the Right to Farm Act was frivolous, the trial court held a hearing to determine the
reasonableness of the attorney fees and costs to be imposed. The trial court properly stated the
test for determining reasonableness, then took testimony from both parties’ attorneys regarding
the reasonableness of the attorney fees requested. On the record at that hearing, however, the
trial court again explained that it considered the frivolous conduct to be only that of Ernest
Bateson, not his attorney. The trial court then imposed the amount of costs and attorney fees that
the Township represented it had incurred since the entry of the final judgment, being $14,555.85,
and assessed this amount entirely against the Batesons and not their attorney.
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One of the purposes of imposing sanctions for asserting a frivolous action or defense is to
deter attorneys from asserting claims or defenses without sufficient research or investigation.
Meisner, 321 Mich. App. at 731-732. An attorney has an affirmative duty to reasonably inquire
into the factual and legal viability of a pleading before signing it. LaRose Market, Inc v Sylvan
Ctr, Inc, 209 Mich. App. 201, 210; 530 NW2d 505 (1995). Whether an attorney’s inquiry is
reasonable is determined by an objective standard, not the attorney’s good faith. Meisner Law
Group PC, 321 Mich. App. at 731. Having found that the Batesons asserted a frivolous defense,
the trial court was obligated under MCL 600.2591 to award the Township its reasonable attorney
fees against both the Batesons and their attorney.
Of course, reasonable attorney fees does not mean that the Township necessarily is
entitled to its actual attorney fees. See In re Attorney Fees and Costs, 233 Mich. App. 694, 705;
593 NW2d 589 (1999) (a trial court’s obligation under MCL 600.2591 is to award reasonable
attorney fees, not actual attorney fees). However, the Township is entitled to establish the
amount of its reasonable costs and fees incurred resulting from the Batesons’ assertion of a
defense under the Right to Farm Act, not limited to those expenses incurred after the final
judgment. Because the trial court in this case did not consider the reasonableness of the
Township’s attorney fees incurred before entry of the judgment,4 we remand to the trial court for
determination of reasonable costs and attorney fees incurred before judgment, and for imposition
of that amount, together with the amount already determined by the trial court to be reasonable
post-judgment costs and attorney fees, against the Batesons and their attorney.
The trial court’s finding that the Batesons’ defense under the Right to Farm Act is
frivolous is affirmed, and we remand for proceedings consistent with this opinion. We do not
retain jurisdiction.
/s/ Anica Letica
/s/ Michael F. Gadola
/s/ Thomas C. Cameron
4
Before the trial court, the parties did not dispute the reasonableness of the Township’s
attorney’s hourly rate nor the reasonableness of the attorney fees incurred post judgment. On
remand, the trial court’s review is limited to determining the reasonableness of costs and of the
number of hours for which the Township seeks attorney fees incurred in connection with this
action before entry of the judgment.
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