Lawrence v. Burdi

STATE OF MICHIGAN

COURT OF APPEALS

FRANK LAWRENCE, FOR PUBLICATION

January 26, 2016

Plaintiff-Appellant, 9:05 a.m.

v No. 322041

Macomb Circuit Court

CAREN M. BURDI and EARL, EARL & ROSE LC No. 2014-001417-CZ

PLLC,

Defendant-Appellees.

Before: METER, P.J., and WILDER and RONAYNE KRAUSE, JJ.

PER CURIAM.

Plaintiff appeals as of right from a Macomb County Circuit Court order granting

defendants’ motion for summary disposition after the court concluded that the statements made

by defendant Burdi (hereinafter defendant) were privileged, and that they could not be the basis

of plaintiff’s claims, and therefore plaintiff failed to state a claim that was actionable. We affirm

in part and reverse in part.

I. FACTUAL BACKGROUND

Plaintiff’s claims of abuse of process and defamation arose from an underlying property

dispute being litigated before Judge Jennifer Faunce (notably the same judge who presided over

this case) in the Macomb Circuit Court, Froling v Pelican Prop, LLC, Docket No. 2013-003083-

CZ. That case concerned a prescriptive easement claim brought by William P. Froling,

plaintiff’s employer, against Pelican Property, who was represented in the matter by defendant.

Plaintiff, who passed the Michigan Bar Examination in 2001, but was unable to pass character

and fitness and be admitted to the practice of law, acts as a liaison between Mr. Froling’s various

corporate entities and the law firms that represent those entities. The easement dispute centered

on whether a restaurant business established on Mr. Froling’s property was entitled to use

property owned by Pelican Property for parking and trash bin storage. A main contention in that

case was whether the restaurant’s use of the property had been continuous over the past 15 years

or not.

After one of Pelican’s main witnesses—District Court Judge Michael Chupa—stated in

an affidavit that the restaurant had been closed for “a substantial period of time, sometime

between April 2004 and November of 2007,” the case was publicized in the local news, which

quoted plaintiff and identified him as Froling’s “spokesman”. Specifically, regarding plaintiff,

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the article said, “ ‘We can show [continuous use] through continuous unbroken leases. We can

show it through health inspection reports, through utility records and eyewitness accounts of

owners, of employees and most importantly, customers,’ said Frank Lawrence, spokesman for

Titan Construction” (one of Froling’s companies).

Shortly after the article was published, and after the closure of discovery in the Froling

case, defendant submitted “Requests to Admit in the Froling v. Pelican Case,” which asked for

six admissions from Mr. Froling, including:

4. Please admit that Frank Lawrence has been denied the opportunity to take the attorney

bar exam for the State of Michigan as he cannot pass character and fitness.

5. Please admit that Frank Lawrence has a felony drug conviction from 1996.

6. Please admit that Frank Lawrence has another drug conviction prior to 1996.

When defendant refused to withdraw the filing, plaintiff filed this suit, claiming abuse of

process and defamation. Plaintiff asserted that the statements were not true and were “unrelated

in any way to the litigation and were intended to maliciously defame a non-party.” Also

included in plaintiff’s complaint, are allegations that in February 2014, while they waited for a

facilitation proceeding in the Macomb County courthouse, defendant approached plaintiff and

Froling and “questioned them in a disrespectful and hostile manner,” before telling Froling “that

he should be careful with whom he associates,” in reference to plaintiff.

Plaintiff first filed a “Motion to Strike and Expunge,” asking that the alleged defamatory

requests to admit be stricken from the record and expunged from the court’s computer system.

Defendant’s response to the motion argued that the trial court had no authority to strike

discovery requests filed in a separate case. Plaintiff responded by withdrawing his motion to

strike and replacing it with a motion to seal. He asserted that the statements, as part of the public

record, were harmful to his reputation and were false in that he had no drug convictions and had

in fact passed the Michigan bar examination. Plaintiff also filed a separate motion for sanctions

under MCR 2.114(E), asserting that defendant had violated MCR 2.114(D) by filing a document

that she knew had no factual basis, for the purpose of harassing and embarrassing plaintiff. In

addition, he asked the court to seal the Board of Law Examiners opinion from 2006. Defendant

then moved for summary disposition under MCR 2.116(C)(8) (failure to state a claim) and

(C)(10) (no genuine issue of material fact).

The trial court first held the hearing on the motions to seal. Plaintiff argued that the

statements, being in the form of requests to admit, appeared to the public as though they were

statements of fact supported by evidence, and it was these untrue and misleading statements he

wished to be sealed. Plaintiff’s counsel also asserted that plaintiff’s character was irrelevant to

the property dispute. To this, the trial court responded, “[H]is name was thrown around an awful

lot in those hearings . . . So, I tend to think he’s a relevant party as far as a witness goes.” When

counsel asserted plaintiff was not a property manager but merely worked with Froling’s lawyers

in property disputes, the court asked, “Does he work with that particular property? His name

came up an awful lot. To make me think that he’s completely irrelevant to that lawsuit doesn’t

strike me as genuine.” Counsel replied that plaintiff may not be “totally irrelevant to the lawsuit,

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because he’s helping the lawyers work in the lawsuit,” but that “his history with the State Bar,

has nothing to do with the Froling lawsuit.” Ultimately, regarding the statement about the bar

examination and the Board of Law Examiners opinion, the trial court found that “there are some

legitimate question[s] regarding that, and . . . I’m not going to order that sealed.” The two

statements about drug convictions, however, the court ordered sealed. Subsequently, sanctions

were not ordered; the entirety of the court’s reasoning on that issue being: “I’m not issuing

sanctions. I don’t think it rose to the level of sanctions.”

The trial court heard the motion for summary disposition a few weeks later. Defendant

argued that the statements made in the requests to admit were made “within the context of the

litigation” and so “the absolute immunity under the judicial proceedings privilege applies.”

Also, that the statement made in the courthouse hallway was only an opinion and, therefore,

could not be the basis for a defamation claim. Defendant asserted that “the courts have

consistently held that defamation cannot be an ulterior motive for an abuse of process” claim,

and therefore, plaintiff’s claims failed. Plaintiff responded by arguing that because plaintiff was

not a party to the Froling case, his claim was not on equal footing with the caselaw defendant

cited for the above propositions. Defendant replied that the trial court already noted that plaintiff

was a witness and as a result, his character and credibility were relevant to the case and therefore

protected by privilege.

The court noted that it had “let a lot of things come in after discovery was closed” and

stated, “I think he [plaintiff] was always a potential witness.” Regarding the statements about

drug convictions, the court said “there wasn’t anything to support the criminal, the alleged

criminal allegation,” but the court nevertheless reasoned, “[T]hat is part of the discovery process.

I do believe that it is privileged.” In addition, the court concluded that the statement made in the

courthouse hallway “is opinion and you cannot show any ulterior motive.”1 For those reasons,

the trial court granted the defendant’s motion for summary disposition, stating that plaintiff

“failed to state a claim for which could [sic] be actionable.” Plaintiff appealed.

II. MOTION FOR SUMMARY DISPOSITION

Plaintiff first argues the trial court erred in granting defendant’s motion for summary

disposition in regards to his claims for abuse of process and defamation. An appellate court

“review[s] de novo a decision on a motion for summary disposition.” Greenville Lafayette, LLC

v Elgin State Bank, 296 Mich App 284, 286; 818 NW2d 460 (2012). It must be noted that the

trial court’s ruling in favor of summary disposition does not expressly state whether the motion

was granted under MCR 2.116(C)(8) or MCR 2.116(C)(10). Based upon the trial judge’s

1

It appears the trial court mistakenly combined aspects of defamation (opinions) with aspects of

abuse of process (ulterior motive). To be clear, our Supreme Court said in Smith v Anonymous

Joint Enterprise, 487 Mich 102, 128; 793 NW2d 533 (2010), that “a statement of opinion is not

automatically shielded from an action for defamation because expressions of opinion may often

imply an assertion of objective fact . . . [A] statement of opinion that can be proven to be false

may be defamatory because it may harm the subject’s reputation or deter others from associating

with the subject.” (quotation marks and citations omitted.)

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comment, “I do believe that it is privileged and, therefore, I think on that portion you failed to

state a claim for which [sic] could be actionable,” and its similarity to the language of MCR

2.116(C)(8), this court presumes that the motion for summary disposition was granted for failure

“to state a claim on which relief can be granted,” under MCR 2.116(C)(8). Accordingly,

[a] motion for summary disposition under MCR 2.116(C)(8) tests the legal

sufficiency of a claim by the pleadings alone. This Court reviews . . . a motion

under MCR 2.116(C)(8) to determine whether the claim is so clearly

unenforceable as a matter of law that no factual development could establish the

claim and justify recovery. All factual allegations supporting the claim, and any

reasonable inference or conclusions that can be drawn from the facts, are accepted

as true. [Averill v Dauterman, 284 Mich App 18, 21; 772 NW2d 797 (2009),

quoting Smith v Stolberg, 231 Mich App 256, 258; 586 NW2d 103 (1998)]

A. ABUSE OF PROCESS CLAIM

“Abuse of process is the wrongful use of the process of a court. This action for the abuse

of process lies for the improper use of process after it has been issued, not for maliciously

causing it to issue.” Spear v Pendill, 164 Mich 620, 623; 130 NW 343 (1911) (quotation marks

omitted). “To recover upon a theory of abuse of process, a plaintiff must plead and prove (1) an

ulterior purpose and (2) an act in the use of process which is improper in the regular prosecution

of the proceeding.” Friedman v Dozorc, 412 Mich 1, 30; 312 NW2d 585 (1981). Expanding on

each of the elements, the Friedman court went on to explain that the act must be something more

than just initiation of a lawsuit and the ulterior purpose has to be something other than settling a

suit. Id. at 31. Justice Cooley, in his treatise on torts, stated “One way in which process is

sometimes abused, is by making use of it to accomplish not the ostensible purpose for which it is

taken out, but some other purpose for which it is an illegitimate and unlawful means.” Cooley,

Treatise on the Law of Torts, or the Wrongs which Arise Independently of Contract (3d ed), p

356.

Turning now to the requests to admit filed in the Froling v Pelican case, this device is

governed specifically by MCR 2.312 and more generally by MCR 2.302. MCR 2.302(B)(1)

regarding the scope of discovery, provides that in general:

Parties may obtain discovery regarding any matter, not privileged, which is

relevant to the subject matter involved in the pending action, whether it relates to

the claim or defense of the party seeking discovery or to the claim or defense of

another party, including the existence, description, nature, custody, condition, and

location of books, documents, or other tangible things, or electronically stored

information and the identity and location of persons having knowledge of a

discoverable matter. It is not ground for objection that the information sought

will be inadmissible at trial if the information sought appears reasonably

calculated to lead to the discovery of admissible evidence. [Emphasis added.]

MCR 2.312(A) states:

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Within the time for completion of discovery, a party may serve on another party a

written request for the admission of the truth of a matter within the scope of MCR

2.302(B) stated in the request that relates to statements or opinions of fact or the

application of law to fact . . .

There is no doubt that filing requests to admit is an act of process, the purpose of which

was given by our Supreme Court in Radtke v Miller, Canfield, Paddock & Stone, 453 Mich 413,

419-420; 551 NW2d 698 (1996):

MCR 2.312 is modeled after FR Civ P 36, and serves two vital purposes:

Admissions are sought, first to facilitate proof with respect to

issues that cannot be eliminated from the case, and secondly, to

narrow the issues by eliminating those that can be. [Advisory

Committee note of 1970 to amend rule 36.]

By encouraging admissions . . . the goal of the rule . . . [is] to expedite the

pending action.

“[R]equests for admission are used to establish admission of facts about which there is no

real dispute.” 7 Moore’s Federal Practice (3d ed), § 36.02[1], p 36-5. Similarly, Michigan’s

court rule has “a two-fold function: (1) to limit the areas of controversy and (2) to save time,

energy and expense that would otherwise be required for preparing proof and submitting

evidence on matters properly subject to admission.” 2 Longhofer, Michigan Court Rules

Practice (6th ed), Rule 2.312, § 2312.3, p 429.

Plaintiff contends that defendant’s filing of the request to admit did not serve any

legitimate purpose stated above, but instead claims in his complaint that it was filed “with the

intent to cause harm to [the plaintiff]” by “defam[ing] and harm[ing] a non-party to the

litigation.” With these filings being made to plaintiff’s employer, the intended purpose appears

to be harm resulting from embarrassment, mistrust by his employer, and even possible

termination of employment. The requests to admit in no way limited the areas of controversy or

saved the parties time, energy and expense. In fact, the result has been quite the opposite—more

time, energy and money has been spent by all parties involved, arguing over an area that was

never previously in controversy, due directly to the request to admit being filed by defendant.

Therefore, plaintiff successfully stated a cause of action for abuse of process in his complaint and

accordingly, summary disposition was improper.

B. DEFAMATION CLAIM

“A defamatory communication is one that tends to harm the reputation of a person so as

to lower him in the estimation of the community or deter others from associating or dealing with

him.” American Transmission, Inc v Channel 7 of Detroit, Inc, 239 Mich App 695, 702; 609

NW2d 607 (2000).

The elements of a cause of action for defamation are (1) a false and defamatory

statement concerning the plaintiff, (2) an unprivileged publication to a third party,

(3) fault amounting at least to negligence on the part of the publisher, and (4)

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either actionability of the statement irrespective of special harm (defamation per

se) or the existence of special harm caused by the publication (defamation per

quod). [Id.]

It has long been established that “words charging the commission of a crime are

defamatory per se, and hence, injury to the reputation of the person defamed is presumed to the

extent that the failure to prove damages is not a ground for dismissal.” Burden v Elias Bros Big

Boy Restaurants, 240 Mich App 723, 727-728; 613 NW2d 378 (2000). With the first element of

a defamation claim being a false statement, it naturally follows that a statement which is

“substantially true” is a defense to a charge of defamation by implication. See Hawkins v Mercy

Health Servs, 230 Mich App 315, 332-333; 583 NW2d 725 (1998). Furthermore, defendants in

defamation suits are not required to prove the statement is “literally and absolutely accurate in

every minute detail.” Rouch v Enquirer & News of Battle Creek Michigan, 440 Mich 238, 258;

487 NW2d 205 (1992).

The plaintiff’s complaint asserts that the basis for the defamation claim is the requests to

admit, as described above, that allege the plaintiff was disallowed from sitting for the bar exam

in Michigan and that plaintiff had drug convictions, both prior to and in the year 1996.2 There

does not seem to be any dispute that the fifth and sixth statements, those about plaintiff’s alleged

drug convictions, had no factual basis and were entirely false. The fourth statement, that plaintiff

was denied the opportunity to take the state bar examination because of character and fitness, is

more capable of being considered substantially true. In determining if a statement is

substantially true or not, the Michigan Supreme Court has said:

a slight inaccuracy in one of its details will not prevent the defendant’s

succeeding, providing the inaccuracy in no way alters the complexion of the

affair, and would have no different effect on the reader than that which the literal

truth would produce . . . Thus, the test looked to the sting of the article to

determine its effect on the reader; if the literal truth produced the same effect,

minor differences were deemed immaterial. [Rouch, 440 Mich at 259, quoting

McAllister v Detroit Free Press Co, 85 Mich 453, 460-461; 48 NW 612 (1891).]

Here, Froling was fully aware that plaintiff was not a member of the state bar but also had

been told that plaintiff had “multi-stated” the bar examination and his intellect was considered a

valuable asset and reason he was hired.3 The Board of Law Examiners’ opinion expressly stated

that plaintiff “took the July 2001 Michigan bar examination and received a passing score.”4 The

inaccurate statement caused Froling to question if plaintiff has been fully truthful with him

during his employment interview regarding the bar examination. Therefore, defendant’s

2

The statement made by defendant in the hallway to Mr. Froling, that he should be careful with

whom he associates, in reference to the plaintiff, is nothing more than a platitude, which we find

unactionable.

3

Affidavit of Carole Froling, pp 1-2.

4

In re Lawrence, MBLE Opinion, issued June 14, 2006, 1.

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statement that plaintiff “has been denied the opportunity to take the attorney bar exam for the

State of Michigan as he cannot pass character and fitness” had a very different effect on the

persons to whom it was published (Froling), than had it been a completely accurate statement.

Because it specifically was false in the most relevant fact, it is difficult to characterize the

statement as having “a slight inaccuracy in one of its details.” The burden at trial is for the

plaintiff to prove falsity. Although the statement about plaintiff’s character and fitness seems

substantially true to the general reader, the effect it had on the persons to whom it was published,

plaintiff’s employer, was very different from the effect a purely accurate statement would have

had.

Plaintiff further pleads that the statements regarding drug convictions are “defamation per

se . . . and . . . do not require proof of damage to [plaintiff’s] reputation.” Assertions that

someone has prior drug convictions are certainly “accusations of criminal activity [and] are

considered ‘defamation per se’ under the law and so do not require proof of damage to the

plaintiff’s reputation.” Ghanam v Does, 303 Mich App 522, 545; 845 NW2d 128 (2014).

Defendant’s main argument regarding the defamation claim is the protection afforded by the

judicial proceedings privilege. Plaintiff argues that the communications made by defendant were

unprivileged because they “were not relevant, material or pertinent” to the underlying litigation.

This issue is discussed next.

C. DEFENSE OF JUDICIAL PROCEEDINGS PRIVILEGE

Defendants argued and the trial court found persuasive in its granting of summary

disposition, that the statements made in the request to admit were made during the course of

discovery, and thus fall under the judicial proceedings privilege, thereby barring plaintiff’s

causes of action. We disagree.

“Statements made by judges, attorneys, and witnesses during the course of judicial

proceedings are absolutely privileged if they are relevant, material, or pertinent to the issue

being tried.” Oesterle v Wallace, 272 Mich App 260, 264; 725 NW2d 470 (2006) (emphasis

added). “The immunity extends to every step in the proceeding and covers anything that may be

said in relation to the matter at issue, including pleadings and affidavits.” Couch v Schultz, 193

Mich App 292, 295; 483 NW2d 684 (1992) (emphasis added). What a litigant considers to be

pertinent or relevant is given much freedom, and the privilege is liberally construed as a matter

of public policy “so that participants in judicial proceedings may have relative freedom to

express themselves without fear of retaliation.” Sanders v Leeson Air Conditioning Corp., 362

Mich 692, 695; 108 NW2d 761 (1961) (internal quotation marks and citation omitted); see also

Couch, 193 Mich App at 295. The statement need not be “strictly relevant to any issue

involved” in the litigation. 3 Restatement Torts, 2d, § 586, cmt c, p 248. All that is required is

that the publication has “some reference” to the subject matter of the litigation; however, the

privilege does not extend to matters that have “no connection whatever with the litigation.” Id.

From this, it appears that the statements’ relevance or pertinence to the issue being tried—the

existence of a prescriptive easement—is determinative of whether they were protected by the

privilege.

In the record for this case, there is absolutely no evidence that plaintiff’s character has

any relevance or pertinence. When the trial court granted defendant’s motion, it agreed with

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defendant that plaintiff was a potential witness for the reason that his name “came up a lot” in the

easement case. But there is no evidentiary support for that conclusion, and defendant notably

has not attached copies of transcripts from the easement case or even the witness list she

allegedly filed after submitting the requests to admit, which supposedly named plaintiff as a

witness. On the record before this Court, there is no evidence to support the assertion that

plaintiff’s name “came up a lot,” or that his prior struggles with the Board of Law Examiners and

alleged history of drug convictions were relevant, pertinent, or material to the Froling case or

that they would shed any light on the easement issue. Indeed, the proceedings in the underlying

Froling case support the conclusion that the admissions sought in the requests served no purpose

in resolving that case; the court apparently never granted an allowance to the late filing, the

requests were never actually answered, defendant apparently never pursued answers, and neither

plaintiff’s name nor his character make even a passing appearance in the court’s final judgment.

Defendant, in her brief, relies considerably on the assertion that a presumption of

relevancy of the statements arises once it is established that the statements were made during the

course of a judicial proceeding. See Sanders, 362 Mich at 695-696. This, however, is a bit of a

muddy area in defamation law. Sanders did not make that statement as a rule of law, but instead

as a quote of the trial court’s language in that case, without ever expressly endorsing the concept.

Id. In Michigan, the source of this “presumption” seems to be Hartung v Shaw, 130 Mich 177;

89 NW 701 (1902). In Hartung, the court stated:

If statements made in the course of judicial proceedings, in pleadings, or in

argument are relevant, material, or pertinent to the issue, their falsity or the malice

of their author is not open to inquiry. They are then absolutely privileged . . .

Where a party shows in his declaration a publication presumptively privileged, it

is his duty, in order to recover, to prove that the words spoken were not pertinent

or relevant, and that they were not spoken bona fide. If it be necessary to prove

this, it is equally necessary to allege it. [Id. at 179-180 (citations omitted).]

In short, the “presumption” identified in Hartung is another way of saying that the burden

is on the plaintiff to allege and then prove that statements made in the course of judicial

proceedings, including pleadings and argument, have no relevance, pertinence, or materiality to

the matter being litigated. Plaintiff sufficiently made that allegation in his complaint.

Moreover, defendant’s pleadings fail to explain, and it is not facially apparent, how the

character of a nonparty who is also not a potential eyewitness has any “reference” to the subject

matter of the easement litigation. 3 Restatement Torts, 2d, § 586, cmt c, p 248. Taking as true

plaintiff’s argument that defendant filed the requests to admit in retaliation for his public

statements about the case, defendant’s conduct seems to turn upside down the public policy

behind the privilege, that is, to permit participants in judicial proceedings to be relatively free to

express themselves without fear of retaliation. Sanders, 362 Mich at 695.

III. DENIAL OF SANCTIONS

This Court reviews de novo whether the trial court properly interpreted and applied the

relevant court rules to the facts, Brecht v Hendry, 297 Mich App 732, 736; 825 NW2d 110

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(2012), and “review[s] for clear error the trial court’s determination whether to impose sanctions

under MCR 2.114.” Guerrero v Smith, 280 Mich App 647, 677; 761 NW2d 723 (2008). A

finding is clearly erroneous if, after a review of the record, this Court is left with a definite and

firm conviction that a mistake was made. Univ Rehab Alliance, Inc v Farm Bureau Gen Ins Co

of Mich, 279 Mich App 691, 693; 760 NW2d 574 (2008).

In regards to the trial court’s ability to levy sanctions against an attorney, MCR 2.114(D)

provides that:

The signature of an attorney or party, whether or not the party is represented by an

attorney, constitutes a certification by the signer that

(1) he or she has read the document;

(2) to the best of his or her knowledge, information, and belief formed after

reasonable inquiry, the document is well grounded in fact and is warranted by

existing law or a good-faith argument for the extension, modification, or reversal

of existing law; and

(3) the document is not interposed for any improper purpose, such as to harass or

to cause unnecessary delay or needless increase in the cost of litigation.

[Emphasis added.]

“If a document is signed in violation of this rule, the court . . . shall impose upon the person who

signed it . . . an appropriate sanction . . . ” MCR 2.114(E).

The requests to admit asked Froling to “admit that Frank Lawrence has been denied the

opportunity to take the attorney bar exam for the State of Michigan as he cannot pass character

and fitness.” Although the statement itself is not entirely true in the specifics, defendant

contends that it indicates that plaintiff was denied bar admission because of character and fitness,

which is true. The Board of Law Examiners decision supports this broader contention, even

though it contradicts the specific assertion that plaintiff was not allowed to take the bar

examination. From the broader point of view, the document was reasonably attached to

defendant’s motion for the purpose of providing support for her argument that plaintiff was

denied bar admission. The trial court’s conclusion that the filing did not rise to the level of being

harassment does not leave this Court with a definite and firm conviction that a mistake was

made, Univ Rehab Alliance, Inc, 279 Mich App at 693. Therefore, we affirm the trial court’s

denial of sanctions against defendant and her attorneys.

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IV. CONCLUSION

Accordingly, we affirm the trial court’s decision to deny plaintiff’s motion for sanctions

against defendant and their attorneys. However, we conclude that plaintiff sufficiently stated

claims for abuse of process and defamation, upon which relief can be granted. Therefore we

reverse the trial court’s granting of summary disposition in favor of defendant.

/s/ Patrick M. Meter

/s/ Kurtis T. Wilder

/s/ Amy Ronayne Krause

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