DocketNumber: Docket Nos. 303724 and 304823
Citation Numbers: 297 Mich. App. 391
Judges: Kelly, Krause, Sawyer
Filed Date: 7/31/2012
Status: Precedential
Modified Date: 9/9/2022
These consolidated appeals arise out of a judgment of divorce entered pursuant to a settlement agreement reached between the parties during mediation. After the settlement was reached but before the judgment was entered, plaintiff had sought to disavow and set aside the settlement and dismiss the case. The trial court denied plaintiffs motions to do so and, pursuant to its finding that the motive behind the motion was frivolous, awarded sanctions to defendant. In Docket No. 303724, plaintiff appeals as of right the judgment of divorce, and in Docket No. 304823, plaintiff appeals as of right the trial court’s award of sanctions. We affirm.
The parties were married in 1988 and had no children together. Plaintiff filed for divorce in 2010. The parties proceeded to mediation on January 26, 2011, which culminated in an audio recording of a settlement agreement as to all issues in the matter. The parties’ attorneys stated on the recording that it had accurately described the agreement and covered everything. Both parties agreed that they understood everything that had been recorded and agreed to all the terms as full, final, and binding. However, when defendant moved to enforce the settlement agreement and for entry of the
Plaintiff first argues on appeal that the trial court erred by finding the audiorecorded settlement agreement binding, arguing that although mediation may culminate in a settlement agreement that will be binding if “acknowledged by the parties on an audio or video recording,” MCR 3.216(H)(7), that process is only available in “domestic relations cases, as defined in MCL 552.502(l),”
“The finding of the trial court concerning the validity of the parties’ consent to a settlement agreement will not be overturned absent a finding of an abuse of discretion.” Keyser v Keyser, 182 Mich App 268, 270; 451 NW2d 587 (1990). “The construction and applica
“Domestic relations matter[s]” include circuit court proceedings as to, among other things, spousal support, arising “out of litigation under a statute of this state, including, but not limited to . . . MCL 552.1 to 552.45.” MCL 552.502(m)(i). Plaintiff sought an award of permanent spousal support in her complaint for divorce, spousal support was identified as a disputed issue in the scheduling order that referred the case to mediation, and spousal support was addressed and decided in the recording of the parties’ settlement agreement. Furthermore, MCL 552.19 and MCL 552.23 address property division in divorce actions. Consequently, it is clear that this proceeding is a domestic relations matter pursuant to both MCL 552.502(m)(i) and MCR 3.216. Accordingly, we reject plaintiffs argument that MCR 3.216 does not apply to the settlement in this case.
We likewise reject plaintiffs statute of frauds argument. The property settlement involved the parties’ interest in lands, so we agree that it is subject to the statute of frauds. However, MCL 566.106 provides that, as an alternative to “a deed or conveyance in writing,” an estate or interest in lands may also be conveyed “by
“[Settlement agreements should not normally be set aside and . . . once a settlement agreement is reached a party cannot disavow it merely because [s]he has had ‘a change of heart.’ ” Metro Life Ins Co v Goolsby, 165 Mich App 126, 128; 418 NW2d 700 (1987). Courts must uphold divorce property settlements reached through negotiation and agreement of the parties because modifications of property settlements in divorce judgments are disfavored. Baker v Baker, 268 Mich App 578, 586; 710 NW2d 555 (2005). “This rule applies whether the settlement is in writing and signed by the parties or their representatives or the settlement is orally placed on the record and consented to by the parties, even though not yet formally entered as part of the divorce judgment by the lower court.” Keyser, 182 Mich App at 270. Here, the parties made their settlement binding by acknowledging it on an audio recording as provided in MCR 3.216(H)(7). The trial court did not err by finding that the parties reached a binding settlement agreement.
Plaintiff relatedly argues that the trial court erred by failing to set aside the settlement agreement under well-established contract principles. Plaintiff argues that she did not actually consent to the settlement
“It is a well-settled principle of law that courts are bound by property settlements reached through negotiations and agreement by parties to a divorce action, in the absence of fraud, duress, mutual mistake, or severe stress which prevented a party from understanding in a reasonable manner the nature and effect of the act in which she was engaged.” Keyser, 182 Mich App at 269-270; see also Calo v Calo, 143 Mich App 749, 753-754; 373 NW2d 207 (1985). However, the parties must have actually consented to the settlement agreement. Howard v Howard, 134 Mich App 391, 397; 352 NW2d 280 (1984). “The finding of the trial court concerning the validity of the parties’ consent to a settlement agreement will not be overturned absent a finding of an abuse of discretion.” Keyser, 182 Mich App at 270. A trial court’s factual findings are reviewed for clear error. Smith v Smith, 278 Mich App 198, 204; 748 NW2d 258 (2008). The trial court did not conduct an evidentiary hearing on plaintiffs claims that she did not actually consent, but the trial court was not obligated to because plaintiff never requested one. See Mitchell v Mitchell, 198 Mich App 393, 399-400; 499 NW2d 386 (1993) (noting that the trial court is not obligated to hold an evidentiary hearing to resolve a factual dispute or ambiguity in a divorce proceeding unless requested by a party).
Plaintiff averred in an affidavit that defendant had threatened to kill her on more than one occasion in the
Plaintiff also averred in her affidavit that the mediator and her attorney repeatedly told her that the proposed settlement was better than that which she could expect at a trial. When a party to a consent judgment argues that consent was achieved through
Plaintiff additionally raised concerns over the provision in the agreement whereby defendant would pay $50,000 directly to plaintiffs attorney. Plaintiff felt betrayed by her attorney because he never told her that she owed him a fee beyond his retainer, and she believed that the payment indicated that defendant had participated in coercing her to settle. As the trial court observed, there was nothing unusual about plaintiffs counsel negotiating a provision requiring defendant to be responsible for some or all of plaintiffs attorney fees. See MCR 3.206(C)(2)(a) (requiring that a party who requests attorney fees and expenses must allege facts to show that he or she is unable to bear the expense of the action and the other party is) and Kosch v Kosch, 233 Mich App 346, 354; 592 NW2d 434 (1999) (“A party in a domestic relations matter who is unable to bear the
Plaintiff claims that her ability to consent to the settlement agreement was impaired by severe stress. However, the test for whether consent was illusory because of severe stress is that of mental capacity to contract. Howard, 134 Mich App at 396. That is, “whether the person in question possesses sufficient mind to understand, in a reasonable manner, the nature and effect of the act in which he [or she] is engaged.” Id. (citation and quotation marks omitted). Plaintiff would therefore have to show that she did not even comprehend the nature or terms of the agreement. Id. Plaintiff simply has not shown anything of the sort; to the contrary, the mediator questioned plaintiff about her understanding of the terms of the settlement agreement, plaintiff affirmatively indicated that she understood the terms, had no questions for her attorney or the mediator, and agreed to all of the terms as a full and final binding settlement of the case. Plaintiffs consent to the agreement cannot be invalidated on the basis of her stress.
Plaintiff next argues that the settlement agreement was unconscionable. This Court has at least implied that a court may review the equities of property settlements in divorce actions when parties “later attempt to renege on such agreements” if they appear unconscionable. See Tinkle v Tinkle, 106 Mich App 423, 428; 308 NW2d 241 (1981). “The examination of a contract for unconscionability involves inquiries for both procedural and substantive unconscionability.” Hubscher & Son, Inc v Storey, 228 Mich App 478, 481; 578 NW2d 701
MCR 3.216(A)(2) specifically provides that “[d]omestic relations mediation is a nonbinding process ....” Plaintiff was not under any obligation to accept the settlement agreement, and she always had the option of proceeding to trial. Plaintiff claimed, without any evidentiary support, that the marital estate had an estimated value of $6 million, making the settlement shocking after a 23-year marriage. The settlement agreement provided plaintiff with cash funds of $1.2 million, required defendant to be responsible for $50,000 of plaintiffs attorney fees, provided that plaintiff was to receive the contents of the parties’ Florida home and either a country club membership or an additional $20,000, and permitted plaintiff to retain all her bank and brokerage accounts, and her retirement account. Even presuming plaintiff received less than half of the mathematical value of the marital estate, we are not persuaded that she received such an inequitable distribution that the trial court can be said to have clearly erred by finding that the agreement was not unconscionable.
Plaintiff also argues that the trial court erred by failing to invalidate the settlement agreement on the basis that it was procured by fraud. “[A]n action for fraud must be predicated upon a false statement relating to a past or existing fact.” Cummins v Robinson Twp, 283 Mich App 677, 696; 770 NW2d 421 (2009).
In sum, the trial court did not err by rejecting plaintiffs allegations of duress, coercion, undue influence, unconscionable advantage, and fraud. The court properly determined that there was no basis for invalidating plaintiffs consent to the settlement.
Plaintiff next argues that the trial court erred by finding that both her motion to disavow the settlement agreement and her motion to dismiss were frivolous without first conducting an evidentiary hearing. “MCR 2.114 does not provide a procedure to be followed before sanctions can be imposed.” Hicks v Ottewell, 174 Mich App 750, 757; 436 NW2d 453 (1989). However, a party must receive some type of reasonable notice and an opportunity to be heard before the imposition of sanctions under MCR 2.114. Id.
Plaintiff was afforded notice that sanctions were being sought by defendant’s motion for costs and attorney fees. Plaintiff answered defendant’s motion and
The trial court did not clearly err by finding that her motions to disavow the settlement agreement and to dismiss the divorce case had frivolous motives. Contel, 183 Mich App at 711. MCR 2.114(D) provides that the signature of an attorney or a party constitutes a certification by the signer that
(1) he or she has read the document;
(2) to the best of his or her knowledge, information, and belief formed after reasonable inquiry, the document is well grounded in fact and is warranted by existing law or a good-faith argument for the extension, modification, or reversal of existing law; and
(3) the document is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.
“The filing of a signed document that is not well grounded in fact and law subjects the filer to sanctions
In this case, the trial court found that plaintiff filed her motions because she had “buyer’s remorse” and simply wanted “a do-over,” but she had no reasonable basis to believe that the facts underlying her legal position were true. The trial court also found that plaintiff filed the motions for the purpose of delay to prevent the judgment of divorce from being entered and that the motions were disingenuous and directed at harassing defendant. The record supports these findings. Plaintiff willingly engaged in mediation, acknowledged that she heard and understood all of the terms of the settlement agreement, and stated that she agreed to all of those terms as a full and final binding settlement of the case. When defendant submitted the written settlement agreement and consent judgment of divorce for signature, plaintiff refused to do so. Instead, plaintiff moved to disavow the settlement agreement and supported her motion with an affidavit averring that defendant had caused her to fear for her life, but then moved to dismiss the case the very next day so she could reconcile with defendant. Plaintiffs inconsistent actions and recorded statements acknowledging her understanding of the settlement terms and her agreement with those terms as a final and binding settlement, as well as the method of mediation used in this case, belie her assertion that her motions were well grounded in fact.
Plaintiff also argues that the trial court erred by finding that her motions were filed for the improper purpose of causing delay. The settlement agreement indicated that the judgment of divorce was to be entered as soon as possible, likely in mid to late February, possibly as late as early March. Plaintiff argues that
Lastly, plaintiff argues that the trial court abused its discretion by awarding sanctions in the amount of $17,695. “We review the amount of an award of sanctions for an abuse of discretion.” In re Costs & Attorney Fees, 250 Mich App 89, 104; 645 NW2d 697 (2002). An award of attorney fees as sanctions under MCR 2.114(E) must be “reasonable.” Id,.; MRPC 1.5(a). Here, the trial court issued an opinion and order in which it made detailed findings of fact and considered the factors set forth in MRPC 1.5(a). Plaintiff does not dispute the trial court’s findings of fact. Rather, she argues that the trial court improperly shifted the burden of proof, improperly decided evidentiary issues by taking judicial notice of the State Bar of Michigan Economics of Law Practice Survey, and failed to recognize that it had discretion to order sanctions in an amount less than the full amount of actual attorney fees. The record does not support plaintiffs claims.
Further, it was not improper for the trial court to consider the State Bar of Michigan Economics of Law Practice Survey when evaluating the reasonableness of defendant’s attorney fees. “It is . . . acceptable for the court to take judicial notice of facts that can be accurately determined by sources of unquestionable reliability, for example, statistics.” Protective Nat’l Ins Co of Omaha v City of Woodhaven, 438 Mich 154, 171; 476 NW2d 374 (1991) (CAVANAGH, C.J., dissenting), citing Fortner v Koch, 272 Mich 273[, 279]; 261 NW 762 (1935). Indeed, in Smith, 481 Mich at 530-532, our Supreme Court stated that “[t]he fees customarily charged in the locality for similar legal services can be established by . . . empirical data found in surveys” and instructed that “trial courts of this state should avail themselves of the most relevant available data” such as
Finally as to this issue, the record does not support plaintiffs argument that the trial court failed to recognize that it had discretion to order sanctions in an amount less than the amount of actual attorney fees requested. Plaintiff is correct that the actual fees charged are not necessarily reasonable fees. Zdrojewski v Murphy, 254 Mich App 50, 72; 657 NW2d 721 (2002). The record discloses that the trial court understood that it was only permitted to award reasonable attorney fees after considering the factors in MRPC 1.5(a). Indeed, the court expressly refused to award attorney fees for various items, including time spent preparing and revising the judgment of divorce and for time spent conversing with defendant’s son. Thus, it is clear that the trial court was aware of its discretion to independently determine the reasonableness of the requested fees.
In sum, we find no clear err in the trial court determination that plaintiff was liable for sanctions because her motions were interposed for frivolous reasons, and conclude that the trial court did not abuse its discretion by awarding costs and attorney fees in the amount of $17,965.
Affirmed.
This statutory provision is now MCL 552.502(m).
We additionally observe that plaintiff failed to comply with the procedure specified by MCR 3.216(D)(1) for objecting to mediation.
The Supreme Court Administrative Office (SCAO)’s Standards of Conduct for Mediators do not specify any particular manner for handling mediation when domestic violence or control exists. However, the SCAO’s Model Screening Protocol for domestic-relations mediation when domestic violence or control exists contains a number of suggestions for keeping parties safe, accommodated, and capable of negotiating and making decisions free from fear or coercion. It appears that the mediator took proper care to ensure that the mediation was free from coercion. See Office of Dispute Resolution, State Court Administrative Office, Michigan Supreme Court, Domestic Violence and Child Abuse/Neglect Screening for Domestic Relations Mediation: Model Screening Protocol (January 2006), <http://courts.michigan.gov/scao/resources/standards/odr/dvprotocol.pdf>