Professional Contracting and Consulting Inc v. Merchants Bonding
332317
| Mich. Ct. App. | Sep 14, 2017Background
- Blue Lotus Hookah Lounge (managed by Khaled Mohamed) hired Professional Contracting and Consulting, Inc. (PCC) for engineering/ construction consulting in mid-2012; PCC recorded construction liens for work performed in 2012.
- Bloomfield Institutional Opportunity Fund foreclosed on the landlord, Blue Lotus was evicted, and Bloomfield sued to quiet title and for slander of title.
- Bloomfield settled with Blue Lotus’s counsel and Racine Miller for $100,000 in exchange for discharge of three construction liens (including PCC’s). PCC alleges it did not consent and that its agent’s signatures on the discharge were forged.
- Notary Mohamad Sobh notarized the discharge documents after relying on Mohamed’s identification of the signer (Mohammad Ghabdan). PCC alleges forgery and a conspiracy to procure false notarizations in violation of the Michigan Notary Public Act.
- At trial: the court granted directed verdicts for Sobh (on conspiracy and later as to Sobh’s compliance — partially reversed), for Mohamed and Blue Lotus (Notary Act inapplicable), and granted summary disposition for Miller and the law firm; jury returned limited contract damages to PCC. PCC appeals multiple rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sobh should have survived directed verdict on Notary Public Act claims (including negligence and conspiracy) | Sobh negligently notarized without ID and was part of a conspiracy to notarize forged signatures | Sobh properly relied on personal knowledge/satisfactory evidence (Mohamed’s identification); no conspiracy evidence | Conspiracy-directed verdict affirmed (no evidence). Directed verdict for Sobh on negligence/Notary Act reversed — credibility conflict for jury to decide |
| Whether the Notary Public Act applies to Mohamed and Blue Lotus (employer liability) | Act should reach entities that enabled or benefited from the notarization | Act applies only to notary and sureties unless employer relationship shown; no evidence Mohamed employed or controlled Sobh | Affirmed: Act does not apply to Mohamed or Blue Lotus (no employer relationship) |
| Whether Miller and the law firm owed PCC a fiduciary duty or are liable for discharging liens without PCC’s consent | Counsel owed a fiduciary duty to PCC or otherwise had obligations to verify signatures | No evidence PCC reposed reasonable trust in Miller or the firm; interests were adverse | Affirmed: summary disposition for Miller and the law firm (no fiduciary duty/reasonable reliance) |
| Admissibility of handwriting witness (Ricci) as lay vs expert testimony | Ricci’s opinion on signatures should be admissible | Ricci was excluded as an expert and offered lay testimony; defendants argued limits | Trial court erred in admitting Ricci’s lay testimony — his opinions were not rationally based on personal perception and were effectively expert comparisons |
Key Cases Cited
- Krohn v Home-Owners Ins Co, 490 Mich 145 (standards for directed verdict review)
- Chouman v Home Owners Ins Co, 293 Mich App 434 (directed verdict/when appropriate)
- Moore v Detroit Entertainment, LLC, 279 Mich App 195 (credibility determinations belong to factfinder)
- Veriden v McLeod, 180 Mich 182 (definition of conspiracy)
- Brackett v Focus Hope, Inc, 482 Mich 269 (use of dictionary/plain meaning in statutory interpretation)
- Hecht v Nat’l Heritage Academies, Inc, 499 Mich 586 (questions of statutory interpretation reviewed de novo)
- Detroit Edison Co v Spartan Express, Inc, 225 Mich App 629 (preamble useful to determine subject matter of statute)
- Capital Area Dist Lib v Michigan Open Carry, Inc, 298 Mich App 220 (preamble useful for purpose and scope of statute)
- Beaty v Hertzberg & Golden, PC, 456 Mich 247 (when fiduciary duty to nonclient may arise)
- Miller v Hensley, 244 Mich App 528 (requirements for lay-witness opinion vs expert testimony)
- PT Today, Inc v Comm’r of Office of Fin & Ins Services, 270 Mich App 110 (appellate refusal to consider issues lacking transcript)
- Mitcham v City of Detroit, 355 Mich 182 (adequate briefing requirement on appeal)