Aroma Wines & Equipment, Inc. v. Columbian Distribution Services, Inc.
303 Mich. App. 441
| Mich. Ct. App. | 2013Background
- Aroma Wines stored 8,374 cases of wine in Columbian Distribution’s temperature-controlled warehouse under a storage/warehouse contract; storage fees became delinquent.
- Columbian asserted a warehouse lien, intermittently allowed limited access, then refused further access until Aroma paid the balance; Columbian moved the wine out of temperature-controlled storage contrary to the contract.
- Aroma sued for breach of contract, UCC violations, common-law conversion, and statutory conversion under MCL 600.2919a; trial proceeded to a jury.
- At the close of Aroma’s proofs, Columbian moved for a directed verdict on statutory conversion (arguing no conversion “to the other person’s own use”); the trial court granted the motion and the jury was not instructed on statutory conversion.
- The jury nonetheless found Columbian liable for common-law conversion and breach of contract and awarded $275,000; post-trial, the trial court initially awarded then rescinded attorney fees to Aroma.
- On appeal the court addressed (1) whether directed verdict on statutory conversion was proper, and (2) whether attorney fees were recoverable for Aroma’s conversion claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether directed verdict on statutory conversion (MCL 600.2919a) was proper | The statutory phrase “to the other person’s own use” has its common, broader meaning; withholding/moving wine and using it as leverage or to free storage space is “use,” so factual question for jury | “Use” requires application like drinking or selling; mere withholding or relocation is not use for the defendant’s own purposes | Reversed: directed verdict improper. Sufficient evidence that moving/withholding could constitute “use” to submit statutory-conversion question to the jury. |
| Whether appellate court should remand and simply award treble damages and attorney fees | Because jury found common-law conversion, treble damages and fees under the statute should be entered | Treble damages and fees under § 2919a are discretionary and questions for the trier of fact | Affirmed that treble damages/fees are permissive; remand required for factfinding; court will not simply award treble damages. |
| Whether Aroma is entitled to attorney fees for conversion under common law (post-trial reconsideration) | Common-law conversion (and UCC principles) permit recovery of attorney fees; Larson supports awarding fees as exemplary damages | Larson is distinguishable; no exemplary damages sought here; later authority narrows Larson; absent statute or proper common-law exception, fees are not allowed | Affirmed denial of fees: Larson not controlling; no exemplary damages pleaded/awarded; general rule bars attorney fees absent statutory or recognized exception. |
| Whether Scott and related UCC cases require attorney-fee award here | Scott supports fees where conversion under UCC and willful breach proven | Scott is distinguishable: plaintiff did not plead UCC conversion or request exemplary damages here | Scott does not mandate fees; outcome stands that fees are unavailable on these facts. |
Key Cases Cited
- Lawsuit Fin, LLC v Curry, 261 Mich. App. 579 (2004) (definition of conversion and common-law standard for wrongful dominion)
- Dep’t of Agriculture v Appletree Mktg, LLC, 485 Mich. 1 (2010) (explains that common-law conversion can occur when possession is proper but used improperly or delivered without authorization)
- Larson v Van Horn, 110 Mich. App. 369 (1981) (discusses exemplary damages theory permitting attorney fees in limited intentional-wrongdoing/conversion contexts; distinguished here)
- Scott v Hurd-Corrigan Moving & Storage Co, Inc, 103 Mich. App. 322 (1981) (addresses exemplary damages and willful breach under UCC; held inapplicable on these facts)
- Khouri v (collecting rule), 481 Mich. 519 (2008) (reiterates general American rule that attorney fees are not recoverable absent statute, rule, or recognized exception)
- Brown v Home-Owners Ins Co, 298 Mich. App. 678 (2012) (sets standard of review for attorney-fee rulings and mixed questions of fact and law)