Angela Agodu v. Israel Agodu

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
ANGELA AGODU, UNPUBLISHED
June 22, 2023
Plaintiff-Appellee,
v No. 362637
Wayne Circuit Court
ISRAEL AGODU, LC No. 21-105709-DM
Defendant-Appellant.
Before: SWARTZLE, P.J., and CAVANAGH and LETICA, JJ.
PER CURIAM.
Defendant appeals as of right from the default judgment of divorce entered by the trial
court. After reviewing defendant’s issues on appeal, we affirm in part, vacate in part, and remand
for further proceedings consistent with this opinion.
The parties were married for approximately 25 years. There was one minor child and the
parties were generally able to reach an agreement on custody and parenting time. However,
defendant argues on appeal that it was error for the trial court to generally adopt plaintiff’s
proposed default judgment of divorce and he contends that this matter should be remanded for
further proceedings.
Plaintiff originally filed a complaint for separate maintenance in June 2021 and defendant
filed a counterclaim for divorce. In preparation for mediation, the parties agreed to have multiple
assets, including multiple businesses located in both Michigan and Nigeria, appraised by business
valuators. Despite an agreement between the parties to jointly select and pay for an individual to
conduct the business valuations, plaintiff produced records showing that defendant refused to
respond to communications about engaging one of the two individuals proposed to conduct
appraisals in time for a pending mediation hearing date. Defendant waited until the day before the
mediation hearing to pay an appraiser, which made it impossible to continue with the mediation.
The resolution of this case was delayed for months because of defendant’s refusal to abide by the
trial court’s orders regarding discovery and mediation.
Plaintiff moved to have defendant show cause why he should not be held in contempt for
his refusal to follow the trial court’s order of May 5, 2022, which required they select the business
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valuator and attempt to reach a settlement. At a hearing on June 10, 2022, the trial court found
that defendant was not abiding by its orders and the court considered its options, including
dismissal of this case, although that appeared to be what defendant was trying to accomplish by
his refusal to participate in discovery. Instead, the court sanctioned defendant $5,000 and if that
was not paid in two weeks, the court was going to strike his answer and counterclaim. Plaintiff
was instructed that she could move forward and file a default.
Apparently after defendant did not pay the $5,000 in sanctions, plaintiff moved for the trial
court to grant a default judgment of divorce. Defendant moved for reconsideration of the trial
court’s ruling to impose sanctions, which the trial court denied on July 27, 2022. The trial court
granted the motion to enter the proposed default judgment of divorce on that same day after hearing
limited testimony from the parties with regard to the court’s jurisdiction, parenting time, and the
breakdown of the marriage.
I. SANCTIONS
Defendant argues that it was error for the trial court to sanction him on the facts of this
case. We disagree.
Initially, before reaching the merits of defendant’s issues on appeal, we must address
plaintiff’s argument that all of the issues on appeal are not preserved because defendant did not
move to set aside the default or the default judgment. MCR 2.603(A)(1) provides that,
[i]f a party against whom a judgment for affirmative relief is sought has
failed to plead or otherwise defend as provided by these rules, the clerk must enter
the default of that party if that fact is:
(a) known to the clerk of the court, or
(b) verified in the manner prescribed by MCL 1.109(D)(3) and filed with
the court in a request for default.
MCR 2.603(A)(3) provides that, “[a]fter the default of a party has been entered, that party may not
proceed with the action until the default has been set aside by the court in accordance with subrule
(D) or MCR 2.612.”
MCR 3.210(B) specifically addresses defaults entered in domestic relations actions and it
generally follows the requirements set forth in MCR 2.603. MCR 3.210(B) similarly provides that
a default must be entered by the court clerk upon request of a party, notice shall be provided to the
defaulted party, and the defaulted party may not proceed with the action until the default has been
set aside. The only significant difference is that MCR 3.210(B)(3) provides that one moving to
set aside a default must show only good cause and need not also show a meritorious defense.
As discussed in Section II, a default was never entered in the record in this case. We
therefore are not convinced that a party subject to a default judgment under MCR 2.313 must
comply with MCR 3.210(B)(2)(c), and (3), or MCR 2.603(A)(3), by moving to set aside the default
before proceeding with the case when there is nothing indicating that a default was filed or served
on that party. Given the lack of compliance with MCR 3.210(B)(2)(a) and (b), even if defendant
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had actual notice of the default, he should be excused from following the requirements in the court
rules on moving to set aside the default. Accordingly, defendant properly preserved his arguments
on appeal by moving for reconsideration of the trial court’s ruling to impose sanctions under MCR
2.313.
The trial court sanctioned defendant by entering a default judgment under MCR
2.313(B)(2)(c) for the failure to abide by the court’s orders related to discovery. This Court
reviews a trial court’s decision regarding discovery sanctions for an abuse of discretion. Swain v
Morse, 332 Mich App 510, 518 n 8; 957 NW2d 396 (2020). A trial court commits an abuse of its
discretion when its decision falls outside the range of reasonable outcomes. Id.The parties were ordered to engage in mediation beginning in October 2021. The trial
court noted in its order of February 3, 2022, that the evaluations of the businesses had not yet been
completed and the parties were returning to mediation. The facts showed that in February 2022,
the parties reached an agreement that they would produce certain information, proceed to the next
mediation date, and would have their businesses valued by a business valuator whom they agreed
upon and also have the marital home appraised. In the trial court’s order of May 5, 2022, the
following was required of the parties:
IT IS FURTHER ORDERED: Extensive business assets involved.
Parties to use either Bruce Knapp or Joseph Cunningham for business evaluations.
Parties to attempt to reach a settlement by next court date. CASE WILL BE
DISMISSED FOR NO PROGRESS IF NOT RESOLVED BY NEXT COURT
DATE.
On May 31, 2022, plaintiff filed her motion to require defendant to show cause for why he
should not be held in contempt for failing to comply with the above order. Plaintiff produced
extensive records of her counsel’s efforts to arrange for mediation in June 2022, and also have an
appraiser complete the work necessary to value the businesses in time for that hearing. Despite
multiple attempts to have defendant agree to a business valuator, sign an engagement letter, and
pay the fee in time, defendant waited until one day before the scheduled mediation to pay a deposit
and sign the engagement letter, which did not give the valuator enough time to perform the
appraisals.
At the hearing on June 10, 2022, defendant did not appear due to a claimed medical
emergency, but his counsel was present. As noted, the trial court sanctioned defendant $5,000 and
also ordered that his answer and counterclaim be struck if he did not pay the $5,000. The trial
court was also advised that defendant closed the group home he operated, which plaintiff
contended was the depletion of a marital asset. The following order was entered after that hearing:
IT IS FURTHER ORDERED: Defendant failed to appear at today’s
hearing; attorney states he is in the hospital; no documentation has been provided.
Defendant has failed to comply with court orders (see record). Court sanctions
defendant $5,000 to be paid to the plaintiff by next court date. Defendant’s answer
and counter-complaint are stricken from the record; Plaintiff to move forward with
default and next hearing.
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Because it appears that the $5,000 was not paid by defendant, the trial court eventually granted the
motion for a default judgment.
This Court’s opinion in Draggoo v Draggoo, 223 Mich App 415, 423-429; 566 NW2d 642(1997), provides guidance for reviewing the trial court’s ruling in this case. In Draggoo, 223 Mich
App at 417-418, the defendant was ordered to answer interrogatories, which required at least two
motions to compel and the answers produced were not satisfactory. It was apparent that he was
not producing bank statements from all of his accounts and business records, as ordered by the
court. The court ordered that the defendant pay sanctions of $1,750 and held him in contempt as
interim sanctions, although the defendant’s medical condition prevented him from serving more
than one day. Even though he was ordered to produce the requested discovery upon his release
from jail, the defendant instead went to Florida, where he remained, and never produced the
ordered discovery. Id. at 418-419. The trial court entered a default judgment against the defendant
when the court believed it had no other way to deal with the defendant. Id. This Court set forth
the following guidance and analysis of the issue, see id. at 423-429:
On appeal, defendant argues that the trial court improperly entered a default
judgment of divorce against him for his refusal to comply with court orders
compelling answers to interrogatories and information about his bank accounts.
We disagree.
MCR 2.313(B)(2) provides in pertinent part:
If a party . . . fails to obey an order to provide or permit
discovery . . . the court in which the action is pending may order
such sanctions as are just, including, but not limited to the following:
* * *
(b) an order refusing to allow the disobedient party to
support or oppose designated claims or defenses, or prohibiting the
party from introducing designated matters into evidence;
(c) an order . . . rendering a judgment by default against the
disobedient party.
In Adams v Perry Furniture Co (On Remand), 198 Mich App 1, 15-16; 497
NW2d 514 (1993), quoting Frankenmuth Mut Ins Co v ACO, Inc, 193 Mich App
389, 396-397; 484 NW2d 718 (1992), this Court observed:
“Default judgment is a possible sanction for discovery
abuses. MCR 2.313(B)(2)(c). It is, however, a drastic measure and
should be used with caution . . . . When the sanction of a default
judgment is contemplated, the trial court should consider whether
the failure to respond to discovery requests extends over a
substantial period of time, whether there was a court order directing
discovery that has not been complied with, the amount of time that
has elapsed between the violation and the motion for default
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judgment, and whether wilfulness has been shown . . . . The court
must also evaluate on the record other available options before
concluding that a drastic sanction is warranted . . . . The sanction of
default judgment should be employed only when there has been a
flagrant and wanton refusal to facilitate discovery, that is, the failure
must be conscious or intentional, not accidental or involuntary. . . .
We review the trial court’s decision to grant a default judgment for
an abuse of discretion.”
Michigan adopted a no-fault divorce law in 1971. Kretzschmar v
Kretzschmar, 48 Mich App 279; 210 NW2d 352 (1973). Since that time, it has
been the law that a marriage will only be recognized if two parties agree, but a
divorce will be granted upon the request of only one of the original marrying
parties, i.e., even over the objection of one of the marrying parties. Id. at 285. This
Court has considered the propriety of granting a default judgment of divorce twice
since no-fault divorces were recognized in Michigan.
In Abadi v Abadi, 78 Mich App 73, 77-78; 259 NW2d 244 (1977), overruled
in part on other grounds in Stamadianos v Stamadianos, 425 Mich 1, 10; 385 NW2d
604 (1986), this Court found that the trial court did not abuse its discretion in
ordering a default judgment of divorce for failure to comply with discovery orders.
In that case, the divorce action had been pending for more than two years when the
trial court entered an order requiring the defendant to produce documents.
Subsequently, the plaintiff’s counsel moved to enforce the order after becoming
“justifiably apprehensive of ever receiving the documents in question.” Id. at 78.
Despite the issuance of an arrest warrant after an alimony show cause hearing, the
warrant had not been served, and “[t]he record was replete with both testimony and
affidavit that the defendant was avoiding service.” Id. The defendant also indicated
that he would not be in court on the trial date and that he was seeking new counsel
because his relationship with his attorney had broken down. In finding that the trial
court did not abuse its discretion in ordering entry of a default judgment against the
defendant, this Court stated:
We realize that dismissing an action or rendering judgment
by default for refusal to make discovery are drastic sanctions.
Nevertheless, the ultimate power of the court to impose such
sanctions is an appropriate remedy where such refusal is flagrant and
wanton. We cannot say on review that the present case did not
justify such drastic action. [Id. at 77.]
Defendant contends that the entry of a default judgment was improper
because the trial court, by barring him from presenting any proofs and from cross-
examining plaintiff concerning issues of property division, prohibited him from
participating in the trial in any meaningful way. To support his contention,
defendant cites Perry v Perry, 176 Mich App 762; 440 NW2d 93 (1989), where
this Court found that the trial court erred in its determination that the defendant
failed to show good cause to set aside a default judgment in a divorce action because
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the defendant was entitled to participate in the adjudication of the property
distribution and to notice at least seven days before the entry of the default
judgment, which contained provisions different in kind and amount from the relief
demanded in the pleading. In Perry, this Court, citing Wood v DAIIE, 413 Mich
573, 583-584; 321 NW2d 653 (1982) and Dollar Rent-A-Car Systems v Nodel
Const, 172 Mich App 738; 432 NW2d 423 (1988), stated:
The purpose of the notice requirement is to apprise the
defaulting party of the possibility of entry of judgment so that he
may have an opportunity to participate in any hearing necessary to
ascertain the amount of damages or other form of remedy to be
granted . . . . This purpose is premised on the distinction between
the entry of default and the entry of judgment. The former operates
as an admission by the defaulting party that there are no issues of
liability, but leaves the issues of damages unresolved until entry of
judgment . . . . The latter reduces the default to a judgment for
money damages. Once a valid default is taken, the defaulting party
remains entitled to full participatory rights in any hearing necessary
for the adjudication of damages . . . .
Plaintiff’s complaint for divorce prayed that the court
“decree an equitable division of property and debts of the parties
hereto.” This prayer does not state a specific amount demanded.
However, the default judgment contains specific provisions for the
division of property and the monetary and legal responsibilities of
the parties. Thus, because the default judgment contained
provisions different in kind and amount from the relief demanded in
the pleading, defendant, even though in default, was entitled to
participate in the adjudication of the property distribution and . . .
was entitled to notice at least seven days prior to the entry of the
default judgment. [Id. at 767-768 (citations omitted).]
The trial court’s actions in the case at bar were entirely appropriate. The
rule set forth in Wood that “a defaulting party who has properly invoked his right
to jury trial retains that right if a hearing is held to determine the amount of
recovery” does not apply in an equitable action, such as a divorce action, where
there is no right to a jury trial. Because Wood is confined to civil actions at law
where the defaulting party retained a right to a jury trial, we find that Perry was
wrong when it indicated that a defaulted party in a divorce case is entitled to full
participatory rights in the adjudication of the property division. Further, because
the court is required to grant a divorce upon the insistence of only one of the parties,
there is no question that a divorce had to be granted in the case at bar. If the court
entered a default against defendant, but then allowed him to fully participate in
presenting evidence regarding the property division, it would be as if no sanction
at all had been imposed for defendant’s flagrant disobedience of the court’s orders.
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In our view, the ultimate sanction of default judgment is a necessary
sanction at the trial court’s disposal to require compliance with its interim orders in
a divorce case. Specifically, under MCR 2.313(B)(2)(b), the court may issue an
“order refusing to allow the disobedient party to support or oppose designated
claims or defenses, or prohibiting the party from introducing designated matters
into evidence.” To allow a defaulted party to flout the court’s authority but still
have an opportunity to contest the property division would thus negate the
effectiveness of the court rule as a deterrent in a divorce action. Further, denying a
defaulted party in a divorce action full participatory rights in the adjudication of the
property division is consonant with the statutory powers of a divorce court. MCL
552.12 . . . provides:
Suits to annul or affirm a marriage, or for a divorce, shall be
conducted in the same manner as other suits in courts of equity; and
the court shall have the power to award issues, to decree costs, and
to enforce its decrees. [Emphasis added.]
As noted in Wiand v Wiand, 178 Mich App 137, 144; 443 NW2d 464 (1989),
quoting Schaeffer v Schaeffer, 106 Mich App 452, 457; 308 NW2d 226 (1981):
“A court possesses inherent authority to enforce its own
directives. A divorce case is equitable in nature, and a court of
equity molds its relief according to the character of the case; once a
court of equity acquires jurisdiction, it will do what is necessary to
accord complete equity and to conclude the controversy.”
Allowing a defaulted party to participate in the adjudication of the property division
in a divorce case would effectively undermine the court’s “inherent authority to
enforce its own directives” and “[to mold] its relief according to the character of
the case.” Id.As in Abadi, supra, we find that the trial court did not abuse its discretion
in granting a default judgment in favor of plaintiff as a sanction under MCR
2.313(B)(2) for defendant’s refusal to comply with the court’s orders compelling
answers to interrogatories and information about his bank accounts. The record in
this case is replete with defendant’s violations of the court’s orders and clearly
shows that the trial court tried less drastic measures to coerce defendant’s
compliance with the discovery requests, but to no avail. We find no abuse of
discretion by the trial court in granting a default judgment of divorce against
defendant, and we find no abuse of discretion in denying defendant permission to
participate in the adjudication of the property division. [Footnotes omitted.]
The facts in Draggoo are not much different from those in this case. Here, the trial court
held settlement conferences beginning in late 2021, giving the parties time to conduct discovery
to prepare for mediation. Although it appears that the parties were able to agree on a mediation
date in June 2022, the record shows that plaintiff was not allowed to prepare for the hearing by
obtaining business valuations for the parties’ assets.
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It is apparent that defendant was engaging in delay tactics to prevent the case from being
mediated. He was essentially stonewalling the efforts to have the case mediated, despite the trial
court’s orders that the parties were to have the businesses and the marital home appraised.
Defendant refused to sign the engagement letter for the appraisal of the businesses until the last
minute when it was apparent that the appraisal could not be performed in time to go ahead with
the mediation hearing.
When the trial court was advised about defendant’s repeated delays in agreeing to hire an
appraiser, the court imposed an interim sanction of $5,000, to be paid in two weeks. When that
was not paid, the trial court then struck defendant’s answer and counterclaim for divorce—which
defendant was told could happen if he did not pay the $5,000. And, in an even more egregious
move, the court was advised by plaintiff’s counsel that defendant had closed the group home he
was operating after he stopped paying the staff, causing them to quit. On that basis, plaintiff
believed that defendant had intentionally depleted a marital asset in the interim. It was apparent
that defendant was attempting to not only delay a resolution in this case, but also deplete or destroy
any assets he controlled. Delaying a resolution in this case until defendant was willing to cooperate
with the trial court’s orders was no longer an option because he appeared willing to destroy the
marital estate before he would agree to participate in these proceedings in good faith.
Because defendant was not willing to abide by the trial court’s orders throughout the
history of this case in order to amicably resolve the issues between the parties, the trial court did
not abuse its discretion by imposing a default judgment as a sanction for his misconduct. The trial
court did impose less severe sanctions in the interim, but it was apparent that defendant was
unwilling to abide by the court’s orders. Allowing him to continue to drag out this divorce might
have caused great harm to the marital estate.
Although defendant attempts to distinguish this case from Draggoo because there were
fewer motions brought to compel compliance and no prior sanctions were imposed, the trial court
had attempted to impose lesser sanctions, without success. Furthermore, the harm defendant was
attempting to do in this case was more severe than simply not cooperating with discovery and, for
that reason, it was appropriate for the trial court not to delay in taking action to sanction his
wrongful conduct. Giving defendant more time to comply, even when sanctions had been
imposed, was not going to compel his cooperation.
In Koy v Koy, 274 Mich App 653, 658-659; 735 NW2d 665 (2007), a similar pattern of
refusal to abide by a trial court’s orders resulted in the granting of a default judgment as an
appropriate sanction. This Court explained that, “[w]hen a trial court must resort repeatedly to
orders and sanctions of increasing severity to compel a party’s participation in court proceedings,
and the party still refuses to comply, the trial court properly exercise its power in entering a default
and, if appropriate, a default judgment against that party.” Id. at 659. Similarly, here, the record
of defendant’s refusal to cooperate with discovery to move this case to resolution supported the
trial court’s decision to sanction him by entering a default judgment when it was apparent that he
was not willing to cooperate to resolve this case and there was a risk that he would deplete the
parties’ assets if a default judgment was not entered in this matter.
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II. DEFAULT
Defendant argues that the trial court should not have entered a default judgment when a
default was never entered. This issue was not raised before the trial court and generally issues not
raised in the trial court are waived on appeal. See Walters v Nadell, 481 Mich 377, 387-388; 751
NW2d 431 (2008); Napier v Jacobs, 429 Mich 222, 233; 414 NW2d 862 (1987). We may,
however, exercise our discretion to review such an issue under certain circumstances, including
when consideration is necessary to a proper determination of the case or when the issue presents a
question of law for which the necessary facts for resolution of the issue have been presented. See
Smith v Foerster-Bolser Constr, Inc, 269 Mich App 424, 427; 711 NW2d 421 (2006). Because
those circumstances exist here, we will consider the issue. Unpreserved issues are reviewed for
plain error affecting substantial rights. “Generally, an error affects substantial rights if it caused
prejudice, i.e., it affected the outcome of the proceedings.” CAJ v KDT, 339 Mich App 459, 464;
984 NW2d 504 (2021).
While defendant argues that a proper default was never entered into the record by the court
clerk, when he moved for reconsideration, defendant acknowledged that the trial court ruled on
the record that he was in default. The ministerial act of not entering the default into the record
does not warrant granting defendant relief.
Defendant relies on Dundee Cement Co v Schupbach Bros, Inc, 94 Mich App 277, 279;
288 NW2d 379 (1979), to argue that because a default was not entered and the court rules were
not followed, the default judgment was void ab initio. However, in Emmons v Emmons, 136 Mich
App 157, 163-165; 355 NW2d 898 (1984), this Court disagreed with the analysis of this issue in
Dundee Cement Co:
Defendant argues that because plaintiff never filed a default, the default
judgment is void ab initio. We disagree.
Before a trial court may set aside a default judgment, the defendant must
show good cause and a meritorious defense. Deeb v Berri, 118 Mich App 556, 561;
325 NW2d 493 (1982).
“Good cause sufficient to warrant setting aside a default
judgment includes: (1) a substantial defect or irregularity in the
proceedings upon which the default was based, (2) a reasonable
excuse for failure to comply with the requirements that created the
default, or (3) some other reason showing that manifest injustice
would result if the default judgment were allowed to stand.” Deeb,
supra.
Defendant argues that plaintiff’s failure to file and enter a default as required by
court rule was a substantial defect or irregularity in the proceedings and that he thus
showed good cause to set aside the default judgment.
The entry of a default pursuant to GCR 1963, 520.1 is generally a ministerial
act of a court clerk accomplished without giving prior notice to the defaulted party.
Deeb, supra, p 562. A defaulted party who has appeared in the case should receive
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notice of the entry of default in order to have the opportunity to move to set it aside
if he or she so chooses. Id. Although plaintiff failed to enter a default in this case,
the default occurred in open court and on the record when defendant moved to have
his pleadings withdrawn. Thus, the spirit and purpose of GCR 1963, 520.1 was
met. Not only did defendant have notice of a default but defendant, in effect,
entered that default himself in open court. Under these circumstances, the failure
to file a pleading labeled “default” can hardly be considered a substantial defect or
irregularity in the proceedings.
Moreover, defendant has not shown how he is prejudiced by this procedural
defect preceding the trial court’s entry of the default judgment of divorce. Section
2315 of the Revised Judicature Act, MCL 600.2315 . . . , provides:
“When a verdict has been rendered in a cause, the judgment
thereon shall not be stayed, nor shall any judgment upon confession,
or default, be reversed, impaired, or in any way affected, by reason
of the following imperfections, omissions, defects, matters or things,
or any of them, in the pleadings, process, record or proceedings,
namely:
“(11) For any other default or negligence of a clerk or officer
of the court, or of the parties, or their counselors or attorneys, by
which neither party shall have been prejudiced.” (Emphasis added.)
Defendant does not argue that he was prejudiced by plaintiff’s failure to
enter a default. Nor could defendant make such an argument given that his actions
amounted to an express consent to a default and, ultimately, to entry of a default
judgment of divorce.
We find defendant’s reliance upon McHenry v Village of Grosse Pointe
Farms, 265 Mich 581; 251 NW 783 (1933), and Dundee Cement Co v Schupback
[sic] Bros, Inc, 94 Mich App 277; 288 NW2d 379 (1979), misplaced. In McHenry,
the Court considered many factors as good cause to set aside the default judgment
in addition to plaintiff’s failure to enter a default. Moreover, the defendant in that
case did show how it was prejudiced by the procedural error in that case. In
Dundee, this Court did state, relying on McHenry, that “[t]he default was not
entered, therefore the default judgment was void ab initio.” 94 Mich App at 279.
The Dundee Court did not consider whether defendant was prejudiced by the
procedural defect. To the extent Dundee may be read as creating any per se rule of
good cause to reverse a default judgment due to a procedural defect of failure to
enter a default, we disagree with it. McHenry does not state such a rule, and such
a per se rule is contrary to § 2315 of the Revised Judicature Act.
Dundee Cement Co is not binding because that decision was issued before 1990. See MCR
7.215(J)(1). This Court instead will follow Emmons on this issue when the facts in that case are
on point to those in the case at bar. Defendant acknowledged that he was aware that the trial court
had entered a default against him at the June 10, 2022 hearing. And if he did not pay the $5,000
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in sanctions, his answer and counterclaim would be stricken. Even though a default was never
actually entered by the court clerk, defendant cannot establish that he was prejudiced when the
court’s order of June 10, 2022 put him on notice that he was facing a default and a possible default
judgment for his failure to abide by the court’s orders. Accordingly, we conclude that the failure
to file a default in this case does not amount to plain error that affected defendant’s substantial
rights.
III. AMENDMENT OF COMPLAINT
Next, defendant argues that it was error for the trial court to enter the judgment of divorce
when plaintiff originally filed a complaint seeking separate maintenance and she never amended
her complaint. The record shows that the parties agreed that plaintiff could amend her complaint
to request a divorce.
Plaintiff argues that it was proper for the trial court to enter a default judgment of divorce
because MCR 2.603(B)(1)(a) recognizes that a party seeking a default judgment may ask for
different relief. However, MCR 3.210(B) is applicable because that is the court rule for default
judgments in domestic relations cases. MCR 3.210(B)(4)(a) provides as follows:
(a) A party moving for default judgment must schedule a hearing and serve
the motion, notice of hearing, and a copy of the proposed judgment upon the
defaulted party at least 14 days before the hearing on entry of the default judgment,
and promptly file a proof of service when:
(i) the action involves entry of a judgment of divorce . . . under subrule
(B)(5)(a);
(ii) the proposed judgment involves a request for relief that is different from
the relief requested in the complaint; or
(iii) the moving party does not have sufficient facts to complete the
judgment or order without a judicial determination of the relief to which the party
is entitled.
There is no dispute that defendant was entitled to notice of the request to enter the default judgment
when plaintiff acknowledged that she was seeking a divorce, which was relief different from what
was originally in her complaint for separate maintenance.
Defendant argues that plaintiff was required to amend her complaint to seek a divorce and
not merely rely on her request for a divorce in her motion for a default judgment. It is apparent
that defendant agreed to the amendment of the complaint on the record at the hearing on July 29,
2022, when the trial court inquired if plaintiff was still seeking separate maintenance. At that time,
the parties agreed that the court could enter a judgment of divorce. Accordingly, an amendment
of the complaint was appropriate pursuant to MCR 2.118(C)(1). Because defendant agreed in the
trial court that this action could be converted into an action for a divorce, not separate maintenance,
he has waived any claim of error involving plaintiff’s failure to amend her complaint to request
that the court grant the parties a divorce. Intentionally and voluntarily relinquishing a known right
constitutes a waiver. Quality Prods & Concepts Co v Nagel Precision, Inc, 469 Mich 362, 379;
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666 NW2d 251 (2003). Furthermore, when a party expressly agrees with an issue in the trial court,
he cannot assume a contrary position on appeal. Grant v AAA Mich/Wisconsin, Inc (On Remand),
272 Mich App 142, 148; 724 NW2d 498 (2006). Defendant cannot now claim that error occurred
because the complaint was not formally amended.
IV. PROPERTY DIVISION AND CHILD SUPPORT
Defendant challenges the trial court’s ruling with regard to the property division and child
support. In Koy, 274 Mich App at 659-660, this Court explained that even though a defaulted
party may not participate in the adjudication of the property division in a divorce case, the trial
court is still obligated to achieve equity when dividing the assets and make findings of fact to
support its decision. Accordingly, the following standards apply:
In a divorce case, this Court must first review the trial court’s findings of fact
regarding the valuations of particular marital assets under the clearly erroneous
standard. Sparks v Sparks, 440 Mich 141, 151; 485 NW2d 893 (1992); Beason v
Beason, 435 Mich 791, 805; 460 NW2d 207 (1990). A finding is clearly erroneous
if, after a review of the entire record, the reviewing court is left with the definite
and firm conviction that a mistake has been made. Id. This Court gives special
deference to a trial court’s findings when they are based on the credibility of the
witnesses. Thames v Thames, 191 Mich App 299, 302; 477 NW2d 496 (1991). If
the trial court’s findings of fact are upheld, this Court must decide whether the
dispositive ruling was fair and equitable in light of those facts. The dispositional
ruling is discretionary and should be affirmed unless this Court is left with the firm
conviction that the division was inequitable. Sands v Sands, 442 Mich 30, 34; 497
NW2d 493 (1993); Sparks, supra at 151-152. [Draggoo, 223 Mich App at 429-
430.]
On the issue of child support, child-support orders are reviewed for an abuse of discretion.
Peterson v Peterson, 272 Mich App 511, 515; 727 NW2d 393 (2006). “An abuse of discretion
occurs when a court selects an outcome that is not within the range of reasonable and principled
outcomes.” Stallworth v Stallworth, 275 Mich App 282, 284; 738 NW2d 264 (2007). This Court
“review[s] for clear error . . . the trial court’s factual findings underlying its determination of a
child-support award.” Id. See also MCR 2.613(C). “A finding is clearly erroneous if this Court,
on all the evidence, is left with a definite and firm conviction that a mistake was made . . . .”
Stallworth, 275 Mich App at 284.
Because the trial court granted a default judgment, defendant was foreclosed from offering
evidence to support his objections or arguments related to the issues of the property settlement and
child support. Instead, the trial court confined its review to the proposed judgment to determine if
the amounts included in it were consistent with the facts of this case. The court specifically found
that the property settlement was fair and equitable. The trial court also presumably approved the
amount of child support, which was set at $566 a month in the judgment. However, the trial court
did not make any actual findings with regard to the amount of child support or defendant’s income
in calculating the amount of support. Nonetheless, there does not appear to be any basis for
requiring that the trial court revisit the basis for calculating the child-support payments.
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MCR 3.210(B) addresses default judgments in domestic relations matters and subsection
(5) of that subrule addresses what information the trial court may consider in determining if the
proposed judgment should be entered:
(a) A judgment of divorce . . . may not be entered as a matter of course on
the default of a party because of failure to appear at the hearing or by consent, and
the case must be heard in open court on proofs taken, except as otherwise provided
by statute or court rule.
(b) Proofs for a default judgment may not be taken unless the proposed
judgment has been given to the court. . . .
(c) The moving party may be required to present evidence sufficient to
satisfy the court that the terms of the proposed judgment are in accordance with
law. The court may consider relevant and material affidavits, testimony,
documents, exhibits, or other evidence.
(d) In cases involving minor children, the court may take testimony and
receive or consider relevant and material affidavits, testimony, documents, exhibits,
or other evidence, as necessary, to make findings concerning the award of custody,
parenting time, and support of the children.
In this case, the trial court reviewed the proposed default judgment at the hearing held on
July 29, 2022, and the court allowed defendant to testify only on the issue of parenting time. The
court otherwise would not allow defendant to address the issues involving the property settlement
or child support when that was part of the sanction for failing to abide by the trial court’s orders.
The court instead made its ruling with regard to the reasonableness of the proposed judgment of
divorce on the basis of the pleadings alone.
A. THE PROPERTY DIVISION
Plaintiff was awarded a single business in Detroit, Michigan, Triple C’s Care Inc., one of
the parties’ group homes. The court granted a property located in Nigeria and a rental property
also located in Nigeria to defendant. The court awarded a business, Triple C’s Innovation Business
Resources Limited, and property associated with it in Nigeria, to defendant. He was also awarded
Chi Chi Group Home, Inc., a business located in Detroit. The judgment also provided that
numerous real properties purchased by the parties at auction during the marriage were not marital
property because they were placed in the names of the parties’ children and others.
In the trial court, defendant objected to the proposed judgment of divorce on the grounds
that Triple C’s Care was operated as two businesses and, therefore, he should receive one of them.
He admitted that Chi Chi Group Home was no longer operational, but he attributed that to
plaintiff’s actions; however, he did not explain what she may have done to close that business. He
contended that there was another business, D-Favor Investment, which owned a number of
investment properties and he stated that plaintiff had transferred them to their children and other
parties without his knowledge. He also suggested that if the court could not value the businesses,
it should sell them all and split the proceeds. He denied owning a bottling business in Nigeria.
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Plaintiff responded that if Chi Chi Group Home ceased doing business, it was from
defendant’s attempt to voluntarily decrease his income. She further denied that Triple C’s Care
was actually two businesses. It was also known by defendant that the business, D-Favor
Investment, was no longer the parties’ business because it was in the names of the parties’ children.
Plaintiff produced corporate documents to show that the parties owned a bottling company
business in Nigeria, Triple C’s Innovation Business Resources Limited.
Although defendant raised objections to the proposed division of assets, it is apparent that
he could not contest the valuations of these assets when he was ordered by the trial court to provide
discovery and agree to have these assets appraised. In Draggoo, 223 Mich App at 430, this Court
declined to review the merits of the defendant’s argument that the property division was not fair
and equitable because of the defendant’s refusal to provide discovery as ordered by the court.
“Given defendant’s steadfast refusal to comply with these orders, he should not be heard to
complain that the trial court committed error in its factual findings when he was the party
responsible for the alleged errors.” Id. Furthermore, the Court recognized that the defendant’s
refusal to answer interrogatories or supply bank documents could be considered a relevant factor
in determining an equitable division of property because it is tantamount to an attempt to conceal
assets. Id.The record shows that plaintiff received one business asset, Triple C’s Care, Inc., which is
also her only source of income. Triple C’s Care and Chi Chi Group Home are adult-care facilities
that the parties each separately operated. Defendant received Chi Chi Group Home in addition to
all of the business and real properties in Nigeria. At least one of those properties was a rental unit
with multiple tenants, generating rental income. The other property housed the bottling business.
Because of defendant’s refusal to cooperate in this matter, he was foreclosed from offering
evidence to support his objections on the property division. Nevertheless, the trial court is charged
with the duty to make findings of fact to support its decision and allow meaningful appellate review
of that decision. See Koy, 274 Mich App at 659-660. Here, the trial court summarily concluded
on the record that the property division was “a very fair and reasonable settlement under the
circumstances.” However, because of the limited record and the trial court’s failure to make
findings of fact, we are unable to confirm that the property division was equitable. See id.Accordingly, we vacate the trial court’s judgment in this regard and remand for the proceedings
necessary to determine an equitable property division and for findings of fact to be set forth on the
record, thus allowing for meaningful appellate review if challenged. Defendant may properly be
precluded from participating in the remand proceedings, see id., and the trial court may exercise
its discretion to redistribute assets if necessary to achieve an equitable property division.
B. CHILD SUPPORT
In the judgment of divorce, defendant was ordered to pay $566.00 per month for the minor
child’s support. To arrive at that figure, defendant’s income included monthly wages from his
employment of $1,126.67, self-employment income of $1,800.00 from Chi Chi Group Home, and
other income of $800.00. Defendant contended that $2,600 in monthly wages was not supported
by law or evidence. He challenged the $1,800 for income attributed to Chi Chi Group Home when
it had ceased operations and he also alleged that the other $800 in income had no known source.
According to plaintiff, the above figures were obtained from defendant’s own reported income.
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In determining a child-support award, the trial court is required to ascertain each parent’s
net income by considering all sources of income. Stallworth, 275 Mich App at 284. The trial court
is not limited to considering only a parent’s actual income. Reed v Reed, 265 Mich App 131, 163;
693 NW2d 825 (2005). The court can consider a parent’s assets, id., or the parent’s voluntary
unexercised ability to earn. Ghidotti v Barber, 459 Mich 189, 198; 586 NW2d 883 (1998).
A trial court is required to determine the amount of child support by following the child
support formula. According to MCL 552.605(2), a court may deviate from the child support
formula and if it does so, it is required to provide its findings on the applicable factors in writing
or on the record to support the deviation. See also Berger v Berger, 277 Mich App 700, 724; 747
NW2d 336 (2008). Here, there is no argument made that the trial court failed to follow the
requirements of the child support formula when calculating the amount of support owed. And it
appears that the trial court did not deviate from the child support formula. Accordingly, the failure
to provide specific findings or justification for its order of support does not require further
supplementation of the record in order to review the amount of support imposed. In addition, the
trial court did not appear to impute income to defendant so as to require specific findings on an
amount he could earn. See Ghidotti, 459 Mich at 198-199.
We conclude that there is no merit to defendant’s argument that the trial court erred by
attributing income of $1,800 a month to him for the group home he operated. Plaintiff
demonstrated that the group home was a marital asset producing income for the family and that
defendant was responsible for operating it. However, since this action was filed, defendant had
ceased operating it for unknown reasons. This otherwise was an asset that the trial court could
include in calculating the amount of support due.
As for the $800 in monthly income, the record shows that defendant had business interests
in Nigeria. He was awarded a rental property in Nigeria with multiple units and he also received
the bottling business in the property division. It was not unreasonable to assess $800 a month in
additional income from these assets. Because defendant refused to abide by the court’s orders and
cooperate with discovery, the true values of these assets were not known and he should not be able
to set aside the default judgment of divorce due to this uncertainty, for which he is responsible.
Because it was undisputed that defendant was awarded additional assets that could generate
income, we conclude that the trial court’s award of $566 a month in child support was adequately
supported with evidence in the record.
Affirmed in part, vacated in part, and remanded for further proceedings consistent with this
opinion. We do not retain jurisdiction.
/s/ Brock A. Swartzle
/s/ Mark J. Cavanagh
/s/ Anica Letica
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