922 N.W.2d 647
Mich. Ct. App.2018Background
- In 2001 Sam (Shambhu), Hemant, and Jaimin Patel formed Shree Vishnu II (SVII) to buy/operate the Holland Econolodge hotel.
- In 2006 Sam wrote a handwritten letter dated June 17 stating he did not want “anything” or “whatever” from the hotel and that his brothers should “share” or “split” what came from it.
- Sam brought a shareholder-oppression action in 2016 seeking damages, accounting, and dissolution of SVII.
- Defendants pleaded waiver and promissory estoppel based on the 2006 letter; they also sought mediation fees as taxable costs after prevailing.
- After a bench trial the trial court found Sam waived his shareholder interest in 2006 and entered judgment for defendants; the court also taxed mediation fees to Sam.
- The Court of Appeals affirmed, concluding the letter and the parties’ subsequent conduct established waiver and that mediation fees were taxable under the relevant court rules and statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Sam waive his shareholder interest in SVII by the June 17, 2006 letter? | The letter was intended to comfort the brothers’ father and not to surrender Sam’s ownership; factual findings against Sam were against the great weight of evidence. | The plain language of the letter and post-2006 conduct (Sam’s nonparticipation, lack of assistance in refinancing/operations, payments characterized as gifts) show intentional, voluntary waiver. | Waiver upheld: trial court’s factual finding not clearly erroneous; letter and conduct established intentional relinquishment of ownership rights. |
| Were mediator/mediation fees taxable costs recoverable by defendants? | (Implicit) Mediation fees should not be taxed absent clear statutory or rule authority. | MCR 2.411(D)(4) deems a mediator’s fee a cost; MCL 600.2405(2) permits taxation of matters made taxable elsewhere; MCR 2.625(A)(1) allows costs to prevailing party. | Fees taxed: plain language of the court rules and statute authorize mediation fees as taxable costs; award affirmed. |
Key Cases Cited
- Sweebe v Sweebe, 474 Mich 151 (defining waiver as intentional relinquishment of a known right; magic words unnecessary)
- Ligon v Detroit, 276 Mich App 120 (standard of review for bench-trial findings)
- Ambs v Kalamazoo Co Rd Comm, 255 Mich App 637 (deference to trial court credibility findings)
- The Cadle Co v City of Kentwood, 285 Mich App 240 (burden on party asserting waiver)
- Reed Estate v Reed, 293 Mich App 168 (waiver may be implied by conduct)
- Henry v Dow Chem Co, 484 Mich 483 (de novo review for court-rule interpretation)
- Guerrero v Smith, 280 Mich App 647 (taxation of costs is statutory; review de novo)
- Beach v State Farm Mut Auto Ins Co, 216 Mich App 612 (presumption that prevailing party may tax costs)
- Velez v Tuma, 492 Mich 1 (clear statutory language enforced as written)
- Fleet Business Credit v Krapohl Ford Lincoln Mercury Co, 274 Mich App 584 (unambiguous court-rule language given plain meaning)
- Diallo v LaRochelle, 310 Mich App 411 (give effect to every clause when interpreting rules)