Dunn v. Bennett
846 N.W.2d 75
Mich. Ct. App.2013Background
- Defendant Timothy Bennett retained plaintiff Stephen Dunn to represent him in IRS lien-related actions; engagement letter dated March 27, 2009 set fees of $275/hour with a $3,000 retainer and a written agreement controlling modifications.
- Dunn represented Bennett for over two years, culminating in a settlement where sale proceeds were distributed: Bennett received $40,110.77 and the IRS collected $25,110.77.
- Bennett paid approximately $20,000 to Dunn during representation; he refused to pay the remaining balance of $116,361.21 sought by Dunn.
- Dunn filed suit asserting (i) breach of contract, (ii) account stated, and (iii) conversion; the trial court granted summary disposition for Dunn on breach and account stated and for Bennett on conversion.
- The court granted review to determine whether the account-stated and breach-of-contract claims survive, and whether there was proper basis for a conversion claim given the absence of a valid charging lien on the funds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an account stated existed against Bennett | Dunn had 33 billing statements; Bennett never objected and made payments. | Bennett did not assent to the amount as a debt; disputed the balance via affidavit evidence. | No genuine issue of material fact; account stated established and summary disposition affirmed. |
| Whether Dunn's breach-of-contract claim is enforceable against Bennett | Written engagement agreement bound Bennett; defendant breached by nonpayment. | Written agreement did not bind plaintiff or there was no mutual modification; alternative arguments insufficient. | Breach of contract and related damages established; summary disposition affirmed. |
| Whether Dunn could pursue a conversion claim given the alleged charging lien | Had an attorney’s charging lien on funds from the sale proceeds. | No valid charging lien existed on the funds; no conversion. | Conversion claim properly denied; no charging lien on funds. |
Key Cases Cited
- Fisher Sand & Gravel Co v Neal A Sweebe, Inc, 494 Mich 543 (2013) (account-stated requires mutual assent to sum due)
- White v Campbell, 25 Mich 463 (1872) (mutual assent and accounting standards)
- Corey v Jaroch, 229 Mich 313 (1924) (payment or receipt of accounting supports assent)
- Pabst Brewing Co v Lueders, 107 Mich 41 (1895) (mutual assent may be inferred from payments or accounting)
- Kloian v Domino’s Pizza LLC, 273 Mich App 449 (2006) (contract existence and interpretation are questions of law by de novo review)
- UAW-GM Human Resource Ctr v KSL Recreation Corp, 228 Mich App 486 (1998) (Mutual modification requires clear and convincing evidence; parol evidence rule applies to written contracts)
- Quality Prods & Concepts Co v Nagel Precision, Inc, 469 Mich 362 (2003) (mutual modification requires clear evidence; parol evidence limits)
- Garras v Bekiares, 315 Mich 141 (1946) (money converted only if identifiable liquid funds or specific obligation)
- Citizens Ins Co of America v Delcamp Truck Ctr, Inc., 178 Mich App 570 (1989) (definition and limits of conversion in money contexts)
- Miller v Detroit Auto Inter-Ins Exch, 139 Mich App 565 (1984) (recognizes attorney’s charging liens role and limits)
- Miller-Davis Co v Ahrens Const, Inc, 296 Mich App 56 (2012) (elements of breach of contract and damages; de novo review applicable)