Scott v. Green

364 N.W.2d 709, 140 Mich. App. 384
CourtMichigan Court of Appeals
DecidedFebruary 4, 1985
DocketDocket 69773
StatusPublished
Cited by8 cases

This text of 364 N.W.2d 709 (Scott v. Green) 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
Scott v. Green, 364 N.W.2d 709, 140 Mich. App. 384 (Mich. Ct. App. 1985).

Opinions

Beasley, J.

Plaintiff, Robert A. Scott, appeals as of right from a directed verdict granted in favor of defendant, Thomas H. Green, at the conclusion of plaintiffs proofs dismissing claims of fraud and legal malpractice. On appellate review, we affirm. We adopt the recitals of fact and the conclusions contained in the dissenting opinion, except with respect to the reversal of the directed verdict regarding plaintiffs claim of fraud.

In his complaint, plaintiff includes a Count V, entitled "Fraud”, in which he alleges, among other things, as follows:__

[387]*387"69. Defendant James Chumbley and defendant lawyer Greene [sic] acting in concert and participation did the following acts intentionally and maliciously, and with intent to defraud plaintiff:
"69a. Prepared an agreement and stock option dated August 3, 1972, (Exhibit A) which purported to transfer twenty-five (25%) percent of the stock in Jim Chumbley Chevrolet, Inc., and induced plaintiff to pay twelve thousand and 00/100 ($12,000.00) dollars therefor (Exhibits B-l and B-2) and accepted plaintiff’s payment, but never intended to issue any stock to or pay over any assets to plaintiff.
"70. Defendant Chumbley took plaintiff’s money and gave his personal promissory notes (Exhibits C and D) therefor, but never intended to repay plaintiff the principal, nor did he intend to pay plaintiff the interest due thereon.
"70a. Defendant Chumbley defrauded plaintiff by fraudulently taking his money on a false promise to repay.
-"71. Defendant Chumbley and defendant lawyer Greene prepared an agreement dated November 25, 1975, (Exhibit F) which purported to guarantee plaintiff in consideration of his work preparing the GM suit twenty (20%) percent of any settlement in the suit filed by defendant James Chumbley and the corporate defendant against GM, said suit to be prosecuted by defendant lawyer Greene.
"71a. Plaintiff did the work necessary to prepare said suit, and defendant James Chumbley and the corporate defendant did receive a substantial settlement of one hundred fifty thousand and 00/100 ($150,000.00) dollars, of which defendant lawyer Greene took thirty-seven thousand two hundred sixty-nine and 00/100 ($37,269.00) dollars in attorney’s fees.
"71b. Defendants drew the settlement checks, or caused them to be drawn in such a manner as to ensure that defendant lawyer Greene and defendant James Chumbley got all or substantially all the settlement money so that none would be paid to the corporation or to plaintiff, who has to date received nothing from said settlement.
"71c. Defendants never intended to pay and have [388]*388refused to pay plaintiff the money he earned. The individual defendants contrived and designed to settle the suit against GM in a manner which was most beneficial to themselves, and without regard to the interest and claim of plaintiff, and in the manner most detrimental to plaintiff.
"72. In August, 1980, defendant lawyer Greene falsely and fraudulently represented that he was filing an appearance on behalf of James Chumbley, in this action; that it was not a conflict of interest to do so; that plaintiff’s promissory notes would be paid in full as soon as the GM suit was tried or settled; and that plaintiff and his counsel should stipulate to an enlargement of time in which to file an answer until December 1, 1980, at which time this action would be settled by full payment of the two (2) promissory notes (Exhibits C and D).
"72a. Defendants never intended to pay or to arrange for payment of said notes, but sought the enlargement of time only to minimize the costs of defense of this action; to prevent entry of a default herein; and to buy time in which to secure the GM settlement to themselves.
"72b. As a consequence, said defendants worked a fraud on plaintiff and on this court.
"73. Defendant James Chumbley and defendant lawyer Greene have intentionally and maliciously converted moneys due plaintiff to their own use, with the intent to permanently deprive plaintiff of his funds.
"74. Plaintiff has acted in good faith in his dealings with defendants.
"75. Plaintiff relied to his great detriment on the intentionally fraudulent acts and misrepresentations by defendant [sic].
"76. As a direct and proximate result of the fraudulent conduct of defendants, plaintiff has been damaged in an amount not less than sixty-eight thousand two hundred fifty and 00/100 ($68,250.00) dollars.”

Regarding this fraud count, it must be noted at the outset that plaintiff has settled with defendant Chumbley for $28,000. Therefore, paragraphs 69 [389]*389and 69a become irrelevant. The key portion of the claims in those paragraphs is the allegation that defendants never intended to issue any stock or to pay over any assets to plaintiff. Since the proofs are clear that control of the stock and possession of the assets was with and in Chumbley, rather than Green, and since plaintiff has chosen to settle with Chumbley, these paragraphs do not assert a cause of action against defendant Green.

Paragraphs 70 and 70a deal only with Chumbley and, thus, are not relevant here. The agreement referred to in paragraph 71 was between plaintiff and defendant Chumbley. Plaintiff says that in the agreement Chumbley "purported to guarantee” him 20% of any recovery in the suit contemplated and pending against GM, in consideration of services to be performed by plaintiff. While preparing the agreement as attorney for the automobile dealership, Green was definitely not a party to the agreement. As indicated in the above quoted paragraphs 71a, 71b and 71c, plaintiff claims that in some way defendants Chumbley and Green caused the settlement checks to be drawn so that they got all, or substantially all, of the settlement money, and so that none would be paid to the corporation (the automobile dealership) or to plaintiff. In paragraph 71c, plaintiff also alleges that defendants never intended to pay and have refused to pay plaintiff the money he says he earned.

There are several obvious difficulties with the fraud theory as contained in plaintiff’s complaint. First, it is not clear as to exactly what fraudulent acts plaintiff charges were committed by defendant Green. Second, the testimony at trial indicates clearly that, for personal and health reasons, Green withdrew from the case against GM and that it was, in fact, prosecuted to a conclusion by another Ann Arbor law firm, Bishop & Shelton. [390]*390The latter firm negotiated the final settlement with GM and actually physically received the checks. It was only after the settlement had been made that the other Ann Arbor law firm advised defendant Green of the fact of the settlement. The documentary evidence is simply contrary to plaintiffs claim that in some way defendant Green manipulated the checks to his own advantage.

Furthermore, and perhaps equally important, plaintiff, in fact, settled with defendant Chumbley for $28,000 immediately prior to trial and then proceeded to trial against defendant Green without amending his complaint.

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

Related

David Sanders v. Shawn Spohn
Michigan Supreme Court, 2020
David Sanders v. Shawn Spohn
Michigan Court of Appeals, 2018
James R. Jackson v. Sidney E. Pollick
941 F.2d 1209 (Sixth Circuit, 1991)
Jackson v. Pollick
751 F. Supp. 132 (E.D. Michigan, 1990)
Scott v. Green
364 N.W.2d 709 (Michigan Court of Appeals, 1985)

Cite This Page — Counsel Stack

Bluebook (online)
364 N.W.2d 709, 140 Mich. App. 384, Counsel Stack Legal Research, https://law.counselstack.com/opinion/scott-v-green-michctapp-1985.