Simcor Construction Inc v. Carl J Trupp III
322 Mich. App. 508
| Mich. Ct. App. | 2018Background
- Simcor sued Carl and Jennifer Trupp for breach of contract; the parties' contract required arbitration.
- Defendants offered judgment to plaintiff for $2,200; plaintiff rejected and counteroffered; arbitration proceeded.
- Arbitrator dismissed plaintiff’s claim with prejudice and awarded no costs; district court denied plaintiff’s motion to vacate and entered judgment confirming the award for defendants.
- Defendants moved under MCR 2.405 for offer-of-judgment costs and fees; the district court initially denied, the circuit court remanded for explanation, then the district court reversed course and denied costs again, relying on pre-amendment authority.
- The Court of Appeals held that a district court’s judgment confirming an arbitration award is a “verdict” under MCR 2.405(A)(4)(c) and remanded for the district court to determine whether the MCR 2.405(D)(3) “interest of justice” exception applies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MCR 2.405 applies when a court confirms an arbitration award | MCR 2.405 does not apply because confirmation of an arbitration award is not a “verdict” | A judgment confirming an arbitration award is a “judgment” and thus a “verdict” under MCR 2.405(A)(4)(c) | Court held confirmation-judgment is a “verdict” under MCR 2.405(A)(4)(c) |
| Whether the judgment was entered as a result of a ruling on a motion after rejection of the offer | The confirmation is appellate in nature and not the kind of post-rejection motion contemplated by the rule | The district court’s ruling on the motion to vacate/confirm occurred after plaintiff rejected the offer and produced the judgment | Court held the judgment resulted from a ruling on a motion after the offer was rejected, satisfying MCR 2.405(A)(4)(c) |
| Whether the arbitrator’s award or its silence on offer-of-judgment costs bars court-awarded MCR 2.405 costs | The arbitrator’s award denied all non-granted claims and imposed no costs; defendants cannot obtain MCR 2.405 costs because arbitrator did not award them | Offer-of-judgment costs arise only after a verdict exists and thus were not for the arbitrator to decide; court may award them | Court held arbitrator did not decide MCR 2.405 costs and confirmation-judgment permits application of the rule; arbitrator’s silence does not bar costs |
| Whether the “interest of justice” exception precludes awarding attorney fees under MCR 2.405(D)(3) | Plaintiff argued the exception applies | Defendants argued the exception does not apply and is only for unusual circumstances | Court found the district court did not analyze the exception and remanded for the district court to decide and articulate its reasons |
Key Cases Cited
- Estes v. Titus, 481 Mich 573 (rule interpretation is reviewed de novo)
- Castillo v. Exclusive Builders, Inc., 273 Mich App 489 (interpreting MCR 2.405)
- Marilyn Froling Revocable Living Trust v. Bloomfield Hills Country Club, 283 Mich App 264 (discussing offer-of-judgment rule)
- Parkhurst Homes, Inc. v. McLaughlin, 187 Mich App 357 (defining “verdict” under prior rule)
- Acorn Investment Co. v. Mich. Basic Prop. Ins. Ass’n, 495 Mich 338 (court confirmed that a post-panel/court motion can satisfy the “verdict” definition)
- Stitt v. Holland Abundant Life Fellowship, 243 Mich App 461 ("interest of justice" exception applies only in unusual circumstances)