Kay Bee Kay Holding Company LLC v. Pnc Bank Na ( 2020 )

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
KAY BEE KAY HOLDING COMPANY, LLC, and UNPUBLISHED
KAY BEE KAY PROPERTIES, LLC, August 20, 2020
Plaintiffs/Counterdefendants/Third-
Party-Defendants,
v No. 347193
Wayne Circuit Court
PNC BANK, NA, LC No. 12-006105-CZ
Defendant/Cross-plaintiff,
and
SAID TALEB,
Defendant/Counterplaintiff/Third-
Party-Plaintiff/Cross-Defendant-
Appellant,
and
KEITH B. KRAMER,
Third-Party-Defendant,
and
TURFE LAW, PLLC, and MILLER CANFIELD
PADDOCK AND STONE, PLC,
Appellees.
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Before: REDFORD, P.J., and METER and O’BRIEN, JJ.
PER CURIAM.
Defendant, Said Taleb, appeals as of right the trial court’s December 20, 2018 order that
Turfe Law, PLLC (Turfe Law) had an attorney charging lien in the amount of $196,965.20. Taleb
also appeals the trial court’s April 7, 2017 order1 in which it ordered (1) that Turfe Law had an
attorney lien, the amount of which would be determined at a later evidentiary hearing after the
conclusion of Keith B. Kramer’s pending bankruptcy proceedings, and (2) that the net proceeds
from the Kramer bankruptcy matter awarded to Taleb as an unsecured creditor would be held in
escrow by Miller, Canfield, Paddock, and Stone, PLC, (Miller Canfield) after it deducted its
attorney fees for representing Taleb in the Kramer bankruptcy proceedings and in the trial court
proceedings. Because Appellant’s arguments are completely devoid of legal and factual merit or
were completely and affirmatively waived by him before the trial court, we affirm.
I. BACKGROUND FACTS AND PROCEDURAL HISTORY
Turfe Law sought an attorney charging lien related to its representation of Taleb in a
lawsuit brought against Taleb by his former employer, Keith Kramer and his companies, Kay Bee
Kay Holding Company, LLC, and Kay Bee Kay Properties, LLC. After representing himself for
about 18 months, Taleb contacted Turfe Law for help. Turfe Law provided Taleb legal counsel
and negotiated submitting the case to binding arbitration that resulted in dismissal of all claims
against Taleb and the arbitrator’s award of $793,333.33 to Taleb, which included $198,333.33 in
attorney fees and costs. A dispute between Turfe Law and Taleb arose over the payment of
attorney fees. Turfe Law asserted that Taleb agreed to a one-third contingency fee but later refused
to sign a written agreement memorializing the fee agreement. The fee dispute resulted in Taleb
and Turfe Law parting ways. Turfe Law moved to withdraw as counsel because of the breakdown
in the attorney-client relationship and requested that the trial court acknowledge its attorney
charging lien.
Taleb hired Miller Canfield to represent him in Kramer’s and his companies’ appeals of
the trial court’s April 3, 2015 order that confirmed the arbitration award and entered judgment in
Taleb’s favor. Miller Canfield also represented Taleb in Kramer’s and his companies’ bankruptcy
proceedings that commenced on April 28, 2015. The filing of the bankruptcy case stayed Kramer’s
1
Turfe Law and Miller Canfield, contend that this Court lacks jurisdiction over Taleb’s appeal of
the April 7, 2017 order on the ground that an appeal of right expired long ago because it qualified
as a final order under MCR 7.202(6)(a)(iv). The trial court, however, did not determine the amount
of the attorney lien until entry of its December 20, 2018 order. In John J Fannon Co v Fannon
Products, LLC, 269 Mich. App. 162, 165-167; 712 NW2d 731 (2005) this Court held that an order
that granted sanctions was not a “final order” for purposes of filing a claim of appeal until the trial
court determined the amount of attorney fees and costs. This case is analogous to Fannon Co.
Appellees’ arguments regarding jurisdiction are unavailing. See also Bonner v Chicago Title Ins
Co, 194 Mich. App. 462, 472; 487 NW2d 807 (1992) (“Where a party has claimed an appeal from
a final order, the party is free to raise on appeal issues related to other orders in the case.”).
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and his companies’ appeals. This Court, therefore, administratively closed their appeals without
prejudice.2 The bankruptcy court terminated the stay respecting Kramer’s appeal on December 15,
2015, and Taleb, by counsel, Miller Canfield, moved to reopen Kramer’s appeal. This Court
granted Taleb’s motion.3 This Court later affirmed the trial court’s order confirming the arbitration
award and judgment in Taleb’s favor.4
The trial court conducted a hearing on December 16, 2016 at which it determined Turfe
Law’s entitlement to an attorney charging lien. Taleb represented himself and did not dispute
Turfe Law’s right to payment for its services, but he argued that the calculation of that amount
should wait until the bankruptcy proceedings concluded. Miller Canfield represented its own
interests and urged the trial court to ensure that Turfe Law did not get paid before Miller Canfield
which had asserted an attorney charging lien in the Kramer bankruptcy proceedings. The trial
court agreed, and included in its April 7, 2017 order that funds disbursed to Taleb in the bankruptcy
proceedings would first be paid to Miller Canfield, then the net amount would be held in escrow
by Miller Canfield until determination of Turfe Law’s fees. The trial court ordered that Turfe Law
had an attorney lien but the amount would be determined at the conclusion of Kramer’s bankruptcy
proceedings.
Turfe Law later moved in the trial court for an evidentiary hearing to settle the attorney
fees dispute but Taleb objected on the ground that the bankruptcy stay had not been lifted and the
bankruptcy proceedings remained pending. After adjourning the issue for several months, the trial
court scheduled the evidentiary hearing for December 11, 2018. Taleb filed an emergency motion
to adjourn the hearing. The trial court denied Taleb’s motion. Taleb himself was personally
present in the courtroom for the entire evidentiary hearing. When given the opportunity to
participate in the hearing, Taleb refused. Taleb interposed no objections to evidence submitted
by Turfe Law and offered no evidence on his own behalf. The trial court considered the
unchallenged evidence submitted by Turfe Law in support of its claim for attorney fees and costs.
Turfe Law conceded that it did not have a contingency agreement signed by Taleb and requested
an award in quantum meruit. The trial court considered the services performed by Turfe Law and
calculated that the value of Turfe Law’s services on behalf of Taleb. It ruled that Turfe Law had
a valid attorney lien equaling $187,500 in attorney fees and $9,465.20 in costs on the basis of
quantum meruit.
II. STANDARD OF REVIEW
We review for an abuse of discretion the trial court’s decision to impose an attorney
charging lien. Reynolds v Polen, 222 Mich. App. 20, 24; 564 NW2d 467 (1997). A trial court
abuses its discretion when its decision falls outside the range of principled outcomes. People v
2
See Kay Bee Kay Holding Co, LLC v PNC Bank, NA, unpublished order of the Court of Appeals,
entered November 12, 2015 (Docket Nos. 327056 and 327077)
3
See Kay Bee Kay Holding Co, LLC v PNC Bank, NA, unpublished order of the Court of Appeals,
entered January 29, 2016 (Docket Nos. 327056 and 327077)
4
Kay Bee Kay Holding Co, LLC v PNC Bank, NA, unpublished per curiam opinion of the Court
of Appeals, issued November 8, 2016 (Docket No. 327077).
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Babcock, 469 Mich. 247, 269; 666 NW2d 231 (2003). “Whether a lien is authorized in a particular
case is a question of law,” which we review de novo. Ypsilanti Charter Twp v Kircher, 281 Mich
App 251, 281; 761 NW2d 761 (2008).
III. ANALYSIS
A. CLAIMS OF ERROR RESPECTING TURFE LAW
Taleb argues that the trial court abused its discretion by awarding Turfe Law’s request for
an attorney charging lien. We disagree.
Taleb first argues that Turfe Law lacked entitlement to an attorney lien for fees and costs
because it withdrew as his counsel. Taleb also contends that Turfe Law forfeited any right to an
attorney lien because of its alleged misconduct. These arguments lack merit.
An attorney charging lien is “ ‘an equitable right to have the fees and costs due for services
secured out of the judgment or recovery in a particular suit.’ ” Souden v Souden, 303 Mich. App.
406, 411; 844 NW2d 151 (2013) (citation omitted). A charging lien is a common-law right and
not provided by statute. Id. “The charging lien ‘creates a lien on a judgment, settlement, or other
money recovered as a result of the attorney’s services.’ ” Id. (citation omitted). “The ability to
enforce an attorney’s charging lien is ancillary to a trial court’s exercise of jurisdiction over the
cases before it.” Id. at 412. This Court has explained that
[t]he [attorney’s charging] lien exists as part of the court’s inherent power to
oversee the relationship of attorneys, as officers of the court, with their clients. It
does provide a means of securing the legitimate interest of the attorney in payment
for his services and expenses on behalf of the client, but it is subject to the control
of the court for the protection of the client and third parties as well .... [Id. at 411
(citation omitted; alteration in original).]
In this case, the record reflects that, although Taleb argued to the trial court that Turfe Law
lacked entitlement to an attorney charging lien, Taleb admitted in his submissions to the trial court
and on the record that Turfe Law in fact performed work on his behalf that entitled it to payment.
Indeed, in several instances, Taleb stipulated that Turfe Law performed work in the case and was
owed money for the reasonable value of that work. Turfe Law conceded that it lacked a
contingency fee agreement or other agreement regarding payment of its fees. Turfe Law, however,
presented evidence at the evidentiary hearing that established that it performed substantial work
and achieved successful results on behalf of Taleb. Turfe Law, therefore, had a right to assert a
lien for the work it performed. The trial court appropriately determined the amount of fees and
costs to which Turfe Law had entitlement under quantum meruit.
Taleb argues that Turfe Law failed to take the appropriate steps to preserve its lien before
withdrawing from the case. The record, however, establishes that Turfe Law moved the trial court
to withdraw from the case because of the breakdown of its relationship with Taleb. The record
also indicates that, shortly after Turfe Law achieved a successful result for Taleb at the 6-day
arbitration proceeding, Taleb ordered Turfe Law to cease working on the file and began disputing
paying Turfe Law for its work. The record does not support Taleb’s contention that Turfe Law
withdrew from its representation for no reason. To the contrary, there was abundant and persuasive
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evidence of record that supported the reasonableness and propriety of the decision of Turfe Law
to seek to end their involvement in the case, following their successful representation of Taleb
throughout the arbitration process.
Michigan law permits an attorney to obtain an attorney charging lien on a theory of
quantum meruit where the client either wrongfully discharged the attorney or the attorney
rightfully withdrew. Reynolds, 222 Mich. App. at 24. In this case, Turfe Law rightfully withdrew
from its representation of Taleb because the record reflects an obvious and material breakdown in
the attorney-client relationship. As to Taleb’s argument that Turfe Law committed misconduct by
attempting to assert a contingency fee agreement without obtaining a written contract, the record
actually reveals that Turfe Law abandoned its contingency fee claim when Taleb made it clear that
he would not sign a written agreement. At the evidentiary hearing, Turfe Law sought
compensation for its services on a theory of quantum meruit. Therefore, Taleb’s allegation of
misconduct lacks merit.
Taleb also argues the trial court violated the bankruptcy stay and lacked jurisdiction to
determine the attorney charging lien matter. This argument lacks merit because the trial court did
not violate the bankruptcy stay. Under 11 USC 362(a)(4), a petition for bankruptcy operates as a
stay of any action respecting property of the bankruptcy estate. The bankruptcy estate is defined
under 11 USC 541 and it pertains only to legal and equitable interests of the debtor, in this case
Kramer and his companies. Turfe Law’s attorney charging lien did not involve or require the trial
court to take any action respecting property of the Kramer bankruptcy estate. On the contrary,
Turfe Law’s attorney charging lien arose related to work it performed for Taleb for which Taleb
refused to pay. The trial court’s order that imposed the lien specifically indicated that payment of
any funds toward the lien were contingent on the bankruptcy court’s disbursement of funds from
the bankruptcy estate to Taleb. It is axiomatic that the bankruptcy court’s disbursement of funds
to unsecured creditors like Taleb could not violate the automatic stay. Further, the trial court’s
later determination of the amount of Turfe Law’s lien did not constitute a violation of the stay. It
merely served to determine the amount of the lien which would potentially be satisfied in whole
or part from funds disbursed to Taleb by the bankruptcy court. In this case, the debtors were
Kramer and his companies. The trial court levied Turfe Law’s attorney charging lien against
Taleb, its former client, who was not a bankruptcy debtor but an unsecured creditor who the
bankruptcy court determined had entitlement to proceeds from Kramer and his companies’
bankruptcy estate. Consequently, the trial court’s grant of the lien was not “against the property
of the estate,” and therefore, the trial court’s action did not implicate the automatic stay under
11 USC 362(a)(4).
Taleb also argues that the trial court lacked jurisdiction because the case was closed and
never reopened. “For an issue to be preserved for appellate review, it must be raised, addressed,
and decided by the lower court.” Mouzon v Achievable Visions, 308 Mich. App. 415, 419; 864
NW2d 606 (2014) (quotation marks and citation omitted). Michigan generally follows a raise or
waive rule of appellate review. Walters v Nadell, 481 Mich. 377, 387-388; 751 NW2d 431 (2008).
In this case, Taleb failed to raise this issue before the trial court, and therefore, waived appellate
review of it. This Court has the discretion to overlook preservation requirements. See Smith v
Foerster-Bolser Constr, Inc, 269 Mich. App. 424, 427; 711 NW2d 421 (2006) (stating that this
Court may overlook preservation requirements where the failure to consider the issue would result
in a manifest injustice, or if consideration is necessary for a proper determination of the case, or if
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the issue involves a question of law and the facts necessary for its resolution have been presented).
Nevertheless, we exercise such discretion sparingly and only where exceptional circumstances
warrant review, none of which apply here. Booth v University of Michigan Bd of Regents, 444
Mich. 211, 234 n 23; 507 NW2d 422 (1993).
Moreover, in this case, Turfe Law originally moved for the case to be reopened and its lien
to be acknowledged. After the trial court granted that motion, this Court reopened Kramer’s appeal
once the bankruptcy court lifted the stay. After being informed of the pending appeal, the trial
court ordered the case administratively closed pending the appeal. Its order specifically provided
that, once the appeal concluded, the attorney fee issue could be addressed without reopening the
case. Taleb has failed to present any authority, statutory or otherwise, that barred the trial court
from entering that order or later resolving the attorney fee issue. The two cases cited by Taleb are
inapposite and he offers no explanation for their general citation. Taleb has also failed to establish
how the trial court lacked jurisdiction to determine the issue. “Generally, where a party fails to
brief the merits of an allegation of error, the issue is deemed abandoned by this Court.” Yee v
Shiawassee Co Bd of Comm’rs, 251 Mich. App. 379, 406; 651 NW2d 756 (2002) (quotation marks
and citation omitted).
It is not enough for an appellant in his brief simply to announce a position or assert
an error and then leave it up to this Court to discover and rationalize the basis for
his claims, or unravel and elaborate for him his arguments, and then search for
authority either to sustain or reject his position. The appellant himself must first
adequately prime the pump; only then does the appellate well begin to flow. [Id.
(citation omitted).]
Taleb, therefore, has abandoned this issue. Further, circuit courts clearly have subject-
matter jurisdiction over such issues. Specifically, this Court has held that “[t]he [attorney’s
charging] lien exists as part of the court’s inherent power to oversee the relationship of attorneys,
as officers of the court, with their clients.” Souden, 303 Mich. App. at 411 (citation omitted;
alterations in original). Accordingly, we find no merit to Taleb’s argument.
For the first time in his reply brief on appeal, Taleb contends that reversal is warranted
because Turfe Law allegedly failed to submit a billing statement in support of its claim for an
attorney charging lien and that Turfe Law was required to move the trial court for permission to
withdraw from the case but failed to do so. Initially, we need not consider these arguments because
Taleb cannot raise new issues in his reply brief. Blazer Foods, Inc v Restaurant Props, Inc, 259
Mich. App. 241, 252; 673 NW2d 805 (2003) (“[R]aising an issue for the first time in a reply brief
is not sufficient to present the issue for appeal.”). Even so, these new arguments lack merit. The
record reflects that Turfe Law presented a detailed estimated invoice and testimony that supported
its claim for a charging lien award in quantum meruit at the evidentiary hearing. Turfe Law
presented uncontroverted evidence regarding the hours it worked on the case and the legal work
performed on behalf of Taleb. Further, the record reflects that Turfe Law moved for permission
to withdraw as Taleb’s attorney. Even if Taleb could raise these issues for the first time on appeal,
he cannot carry his “burden of furnishing the reviewing court with a record that verifies the basis
of any argument on which reversal or other claim for appellate relief is predicated.” Petraszewsky
v Keeth, 201 Mich. App. 535, 540; 506 NW2d 890 (1993).
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B. CLAIMS OF ERROR REGARDING MILLER CANFIELD
Taleb offers a convoluted argument in an effort to support his claim that the trial court
erred by granting Miller Canfield relief. “Generally, an issue is not properly preserved if it is not
raised before, addressed, or decided by the circuit court or administrative tribunal.” Marik v Marik,
325 Mich. App. 353, 358; 925 NW2d 885 (2018) (quotation marks and citation omitted). “Michigan
generally follows the ‘raise or waive’ rule of appellate review.” Walters, 481 Mich. at 387 (citation
omitted). During the trial court proceedings, Taleb never challenged Miller Canfield’s entitlement
to being paid attorney fees and costs. The record reflects that Miller Canfield never requested or
received entry of an order respecting an attorney charging lien in this case. Instead, Miller Canfield
only sought to ensure that its lien asserted in the bankruptcy proceedings would be paid first from
the proceeds disbursed by the bankruptcy court to Taleb before Turfe Law or Taleb received their
respective shares. The trial court never considered or determined Miller Canfield’s entitlement to
a lien or the amount of an attorney charging lien if so entitled.
Moreover, Taleb’s arguments regarding Miller Canfield also lack merit because his appeal
of matters pertaining to Miller Canfield amounts to an impermissible collateral attack on the
attorney charging lien asserted in the Kramer bankruptcy proceedings. “It is well established in
Michigan that, assuming competent jurisdiction, a party cannot use a second proceeding to attack
a tribunal’s decision in a previous proceeding[.]” Workers’ Compensation Agency Dir v
MacDonald’s Indus Prod, Inc (On Reconsideration), 305 Mich. App. 460, 474; 853 NW2d 467
(2014). In this case, the trial court never entered an attorney charging lien in favor of Miller
Canfield nor calculated its attorney fees and costs related to its representation of Taleb. The trial
court, however, acknowledged Miller Canfield’s entitlement to payment from the proceeds
recovered in the Kramer bankruptcy case, and therefore, in its April 7, 2017 order, appropriately
provided for Miller Canfield’s priority interest in such proceeds. Miller Canfield filed its notice
of attorney lien in the bankruptcy court and specified the amount it considered due from Taleb for
the services it performed for him. Consequently, if Taleb wished to challenge that lien, he needed
to do it in the bankruptcy court, or on direct appeal from any decision by that court in the
bankruptcy proceedings.
Appellees, having prevailed on all issues in this matter, may assess costs against Appellant
pursuant to MCR 7.219.
Affirmed.
/s/ James Robert Redford
/s/ Patrick M. Meter
/s/ Colleen A. O’Brien
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