Algarawi v. Auto Club Insurance

624 N.W.2d 443, 243 Mich. App. 697
CourtMichigan Court of Appeals
DecidedDecember 15, 2000
DocketDocket No. 201920
StatusPublished
Cited by55 cases

This text of 624 N.W.2d 443 (Algarawi v. Auto Club Insurance) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Algarawi v. Auto Club Insurance, 624 N.W.2d 443, 243 Mich. App. 697 (Mich. Ct. App. 2000).

Opinion

Whitbeck, J.

Appellants Norris Goudy and Auto Club Insurance Association (acia) appeal as of right. Acia challenges the trial court’s March 3, 1997, order holding it in contempt of court. Goudy, in-house counsel for acia, challenges the trial court’s March 5, 1997, order holding him in contempt of court. We reverse.

I. introduction

As so often occurs in contentious litigation, this appeal arises largely because the lawyers’ zest for legal combat overwhelmed their common sense. In the process, a relatively uncomplicated settlement process became a battleground between a stubborn insurer, acia, and the equally stubborn attorneys for the claimant, Hawra Algarawi. While the insurer’s legal position was legally correct, the bitter legal warfare between the parties ultimately strained the trial court’s patience to the breaking point, resulting in contempt orders against the insurer and its attorneys. Ironically, after the trial court entered those contempt orders, the parties apparently negotiated a truce, if not a peace agreement, under which the insurer paid the full amount of the $16,500 settlement to Ali Abdul-Hussein Algarawi, Algarawi’s father, as her next friend.

With the smoke clearing from this battlefield, we need not address any issues concerning the underlying claim for insurance benefits in this case. Rather, we must confront a series of issues relating to the trial court’s contempt orders. In particular, we must determine whether the trial court’s contempt orders in this case were for criminal or civil contempt, whether the trial court followed the appropriate pro[700]*700cedures to hold ACIA and Goudy in contempt, and whether the sanctions the trial court ordered were proper. Because we ultimately resolve this case on procedural grounds, we need not address whether there was sufficient evidence to prove that Goudy and ACIA committed contempt.

We make one other preliminary note to clarify what could be a confusing element in this case. Although the trial court held Mary T. Nemeth, acia’s retained attorney, in contempt of court, she does not appeal. Thus, while we recount the circumstances concerning the contempt order against her because those facts are closely connected to the facts that concern Goudy and acia, we neither affirm nor reverse the trial court’s contempt order against her.

II. BASIC FACTS AND PROCEDURAL HISTORY

The parties placed a settlement agreement on the record in January 1997. Shortly thereafter, in mid-February 1997, Algarawi filed an emergency motion to show cause. She claimed that ACIA refused to issue a check to her father as her next friend. She also alleged that acia was attempting to force her to open a probate estate before it would pay the settlement, even though the payments would be used to pay her medical and legal expenses, leaving none left over for her. Algarawi asked the trial court to issue an order directing acia to deliver a check in compliance with the settlement agreement. In response to the motion, ACIA argued that it could pay a sum of this magnitude only if Algarawi, because she was a minor, opened a probate estate. At the hearing on the emergency motion that same day, the trial court asked Goudy to determine whether ACIA would issue the check if [701]*701Algarawi did not open a probate estate. The trial court concluded the hearing, but did not issue a written order resolving the parties’ dispute.

In late February 1997, Algarawi filed a second emergency motion to show cause, arguing that, at the earlier hearing, the trial court had ruled that acia must issue a check payable to her father and to her attorneys and that ACIA must deliver the check within ten days. Algarawi contended that acia refused to deliver the check as ordered and, therefore, requested an order directing acia to deliver the check. Acia countered that Goudy had told the trial court that he would ask ACIA to approve issuing the check and — if it agreed to do so — he would have the check within ten days. Acia also continued to argue that Algarawi had to open a probate estate to receive the settlement, which would ensure that she would not sue ACIA when she reached the age of majority if her father mismanaged or misappropriated the funds.

On February 26, 1997, the trial court held a hearing on Algarawi’s second emergency motion to show cause, after which it concluded that Algarawi did not need to open a probate estate in order to receive the settlement money.1 As a result, the trial court ruled that acia had to give the settlement money to Algarawi by hand-delivering a check to her attorneys’ offices by noon on February 28, 1997. The trial court did not issue a written order to this effect.

[702]*702According to acia, on February 28, 1997, Nemeth, acia’s retained attorney, appeared at Algarawi’s attorneys’ offices where she presented a $5,000 check. Nemeth attempted to explain to Algarawi’s attorneys that it would be illegal for acia to pay more than $5,000 directly to Algarawi’s father. When Algarawi’s attorneys refused to accept the $5,000 check, instead demanding a check in the full amount of $16,500, acia moved to compel Algarawi’s attorneys to accept $5,000 in partial satisfaction of the settlement.

Also on February 28, 1997, acia filed a motion to modify the trial court’s oral ruling on the second emergency motion, arguing that it had attempted to comply with the ruling to the fullest extent possible without violating the law by offering the $5,000 check to Algarawi’s attorneys. Acia argued that only a conservator appointed to administer a probate estate for Algarawi could accept the remaining $11,500. Acia asked the trial court to direct Algarawi’s attorneys to commence appropriate probate proceedings to open an estate so that a court could appoint a conservator for her and so it could finally pay the remaining $11,500. Acia also asked the trial court to enter an order granting its motion because Algarawi’s attorneys had refused to approve a proposed order concerning this $5,000 partial payment.

On the same day, however, Algarawi moved to hold Goudy in contempt of court. She argued that, at the hearing on the first emergency motion, the trial court had ordered Goudy to deliver a check for $16,500, Goudy had violated this order, the trial court had granted Algarawi’s second emergency motion, and Nemeth had attempted to persuade Algarawi’s attorneys to accept a $5,000 check, violating the trial [703]*703court’s second ruling. Algarawi therefore contended that the trial court should hold Goudy in contempt and sanction him until acia delivered a check for $16,500.

On March 3, 1997, the trial court held a hearing on Algarawi’s motion to hold Goudy in contempt. Nemeth argued that the trial court should grant AClA’s motion to modify the trial court’s previous ruling that Algarawi did not need to open a probate estate and to allow acia to pay only $5,000 to Algarawi’s father as her next friend. Then, Nemeth argued, acia could appeal the trial court’s ruling. As the following transcript excerpts reveal, the trial court made it well-known to everyone present at the hearing that it was not impressed with acia’s argument.

The Court: . . . Okay. I’ve heard the law. I read the case law. I read it last time. Now you’re in contempt. Who wants to go to jail?
Ms. Nemeth [defense counsel]: Your Honor, I’m the one.
The Court: Okay.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

In Re Contempt of Michelle L Elowski
Michigan Court of Appeals, 2026
In Re Contempt of Marshall Tauber
Michigan Court of Appeals, 2025
In Re Contempt of Kathy H Murphy
Michigan Supreme Court, 2025
In Re Contempt of Rebecca Tieppo
Michigan Court of Appeals, 2024
In Re Sb
Michigan Court of Appeals, 2024
20240215_C365225_67_365225.Opn.Pdf
Michigan Court of Appeals, 2024
Robert Davis v. Board of State Canvassers
Michigan Court of Appeals, 2023
In Re Conservatorship of Dpv
Michigan Court of Appeals, 2023
20230221_C359305_34_359305.Opn.Pdf
Michigan Court of Appeals, 2023
20230209_C360560_41_360560.Opn.Pdf
Michigan Court of Appeals, 2023
In Re Contempt of Marlena Pavlos-Hackney
Michigan Court of Appeals, 2022
In Re Wallace Howe Family Trust
Michigan Court of Appeals, 2022
Fahmida Begum v. Moudud Chowdhury
Michigan Court of Appeals, 2022
In Re Contempt of Luke Johnson
Michigan Court of Appeals, 2022
In Re Deblock Estate
Michigan Court of Appeals, 2022
in Re Jcb
Michigan Court of Appeals, 2021

Cite This Page — Counsel Stack

Bluebook (online)
624 N.W.2d 443, 243 Mich. App. 697, Counsel Stack Legal Research, https://law.counselstack.com/opinion/algarawi-v-auto-club-insurance-michctapp-2000.