Wiand v. Wiand

522 N.W.2d 132, 205 Mich. App. 360

• Court: Michigan Court of Appeals
• Decided: May 17, 1994
• Docket: Docket 134224, 135309, 135310
• Status: Published

Opinion

Per Curiam.

In Docket No. 134224, plaintiff Lenore L. Wiand appeals as of right from the October 2, 1990, order of Oakland Circuit Court Judge Barry L. Howard that granted defendant Ronald Wiand’s motion for summary disposition, pursuant to MCR 2.116(C)(7), and dismissed plaintiff’s complaint in Wiand v Wiand, Oakland Docket No. 89-374129-CZ (hereinafter Wiand II).

In Docket No. 135309, plaintiff appeals as of right from two orders issued on November 9, 1990, by Oakland Circuit Court Judge Steven N. Andrews (acting for Judge Howard): an order denying plaintiff’s motion to set aside, modify, or obtain relief from the divorce judgment in Wiand v Wiand, Oakland Docket No. 82-250656-DO (decided February 25, 1987) (hereinafter Wiand I), and an order denying plaintiff’s motion to amend her complaint in Wiand II to add a claim for independent equitable relief.

Docket No. 135310 involves Judge Andrews’ (acting for Judge Howard) November 9, 1990, denial without prejudice of defendant’s motion for sanctions. Plaintiff appealed this order, but does not argue the issue.

We affirm in part and reverse in part.

i

After a contested divorce proceeding, the parties were granted a divorce on February 25, 1987, by Oakland Circuit Judge Norman L. Lippitt. See Wiand v Wiand, 178 Mich App 137; 443 NW2d 464 (1989), for a brief recitation of the facts in Wiand I.

In Wiand I, the trial court issued an opinion expressly finding that defendant engaged in conduct designed to frustrate plaintiff’s efforts to discover his assets 1 2and conspired with his brother to deprive plaintiff of her rightful share of the marital estate. The court listed those assets that it found to be part of the marital estate and assigned them values. With regard to certain assets — patents and formulas used by Inland Diamond Products Company, office buildings on Howard and Edward Streets, and an equitable interest in Inland Crafts Products Company — the court "assumed” a total value of $300,000, but stated:

|T]f either party wishes to conduct discovery, seek independent audit or offer further proofs in this regard, the Court will entertain appropriate post judgment motions. 2

The opinion awarded plaintiff specific assets. Defendant was awarded

all other assets the Court has specifically found to be a part of the marital estate, including those he disclaims having any interest in. However, he is not awarded other undisclosed assets which later may be determined to be his.

The judgment of divorce, entered in accordance with the judge’s opinion, awarded defendant specific assets including "the patent and business formulas which were the subject of testimony at the time of trial of this matter, the ownership of which is disputed by the Defendant-husband” (emphasis added) and "his 50% equitable interest in the office buildings located at 32051-53 Howard and 32046-48 Edward . . . the ownership of which is disputed . . . The judgment further provided:

The Property Settlement set forth herein is based upon a marital estate consisting of only those assets set forth above. Should it be determined that additional marital assets existed other than those set forth above, this Court retains jurisdiction over this matter for the purpose of rendering an equitable distribution of such assets.

The judgment of divorce also provided:

POST JUDGMENT DISCOVERY

IT IS FURTHER ORDERED AND ADJUDGED that either party, by post judgment motion, may petition the Court to conduct discovery, seek independent audit or offer further proofs relative to the value of the Defendant-husband’s equitable interests in the following marital assets: patents and formulas used by Inland Diamond Company; the husband’s 50% interest in the office buildings at 32051-53 Howard and 32046-48 Edwards Streets; and the husband’s 50% interest in Inland Craft Products Company, the ownership of which is disputed by the Defendant-husband. The specific findings in this regard of this Court’s opinion of December 18, 1986, are incorporated herein by reference.[ 3 ]

The Court of Appeals vacated pursuant to MCR 7.216(A)(7) that portion of the judgment of divorce that provided for further discovery, independent audit, and further proofs. 4 In all other respects, the Court affirmed the judgment. 5

On July 28, 1989, plaintiff filed her complaint in Wiand II, claiming damages based on fraud, misrepresentation, interference with advantageous relationships, conversion, and violation of court orders. Plaintiff did not serve this complaint on defendant until May 1990. In response to plaintiffs complaint in Wiand II, defendant filed a motion for summary disposition on July 12, 1990. In August 1990, while defendant’s motion was pending, plaintiff filed a motion to add parties defendant.

Following a hearing on September 19, 1990, Judge Howard granted defendant’s motion for summary disposition in Wiand II pursuant to MCR 2.116(C)(7) and denied plaintiffs motion to add parties defendant. An order was entered October 2, 1990. On the same day, plaintiff filed a motion to set aside, modify, or obtain relief from the divorce judgment in Wiand I, on the basis of newly discovered evidence and fraud. In addition, plaintiff asked the trial court to schedule an evidentiary hearing and grant her an increase in alimony on the basis of a change in circumstances. On October 23, 1990, plaintiff filed a motion to amend her complaint in Wiand II to add a claim for independent equitable relief. In orders dated November 2, 1990, Judge Andrews (for Judge Howard) denied plaintiffs motions to set aside, modify, or obtain relief from the judgment in Wiand I and to amend her complaint in Wiand II.

ii

Plaintiff first argues that the trial court improp erly denied her motion to set aside, modify, or obtain relief from the divorce judgment entered in Wiand I based on newly discovered evidence and fraud.

Under MCR 2.612(C)(2) a motion for relief from judgment based on either newly discovered evidence or fraud of an adverse party must be made within one year after the final judgment was entered. Rucinski v Rucinski, 172 Mich App 20, 22; 431 NW2d 241 (1988).

Given that plaintiff did not know that no further discovery or proofs would be allowed under the postjudgment discovery provision of the divorce judgment in Wiand I until this Court’s July 8, 1989, opinion in Wiand v Wiand, supra, the one-year period of limitation provided by MCR 2.612(C) (2) was tolled until the entry of this Court’s decision. Thus, plaintiff had one year after entry of this Court’s decision within which to file and to serve a motion for relief from judgment under MCR 2.612(C)(2) based on her claims of newly discovered evidence, fraud, and misrepresentation.

Plaintiff filed her motion for relief from judgment in Wiand I on October 2, 1990, more than one year after this Court had stricken the post-judgment discovery provision from the divorce judgment. However, plaintiff’s complaint in Wiand II claiming, inter alia, fraudulent concealment of assets, which was filed on July 28, 1989, and served on defendant in May 1990 (within one year of this Court’s decision), alleged fraud and misrepresentation throughout the pendency of the divorce action.

In view of the allegations made in plaintiff’s complaint in Wiand II, and under these circumstances in which the complaint in Wiand II was filed within three weeks after this Court’s decision in Wiand I and the motion in Wiand I was filed the same day as the entry of the order granting defendant’s motion for summary disposition in Wiand II, the complaint in Wiand II, claiming damages based on fraud, misrepresentation, interference with advantageous relationships, conversion, and violation of court order, should be regarded as a timely filed motion for relief from judgment in Wiand I, and the motion later filed in Wiand I, upon the dismissal of Wiand II, a continuation of that motion.

In her motion, plaintiff alleged that the newly discovered evidence consists of previously undisclosed assets including an office building, five new patents, and additional businesses in which defendant had an equitable interest; newly discovered values for assets previously disclosed; and a $40,-000 undisclosed tax liability. She also seeks to address alimony.

We agree with defendant that the alleged undisclosed tax liability is not a liability within the meaning of the judgment of divorce.

With respect to alimony, we agree with defendant that plaintiff’s request for a modification in alimony, made long after the six months of alimony awarded under the judgment had been paid, did not establish grounds for modifying the term or amount of the rehabilitative alimony awarded her under the judgment.

With respect to the undisclosed value of disclosed assets, we agree with the trial court that this claim attempts to "rehash” matters that were already addressed and is contrary to this Court’s earlier decision in Wiand I, wherein the Court struck the provision in the judgment of divorce providing for an independent audit and further proofs concerning the value of certain disclosed assets.

With respect to the claims regarding undisclosed assets, however, we come to a different conclusion. Notwithstanding the need for finality in litigation, we believe that where there is evidence of concealment, it is not improper for a judgment of divorce to include a provision, as in the instant case, stating that undisclosed assets are not covered by the judgment and are subject to further proceedings. Cf. Sands v Sands, 442 Mich 30; 497 NW2d 493 (1993). 6 If such provisions are to be enforced, the trial court must entertain posttrial motions regarding undisclosed assets.

We conclude that plaintiffs allegations regarding undisclosed assets must be considered by the trial court. It is not clear to us that the trial court’s statement that plaintiffs motion was an attempt to "rehash what was done last time” was a finding that each of the alleged undisclosed assets was, in fact, addressed in Wiand I. While defendant has pointed to portions of the record indicating that some of the assets that were alleged to have been undisclosed, at the time of the original proceedings, indeed, may have been addressed in Wiand I, it appears that plaintiff has alleged the existence of some undisclosed assets that were not previously addressed. For this reason, remand is in order.

On remand, the trial court shall consider plaintiffs allegations regarding undisclosed assets. To the extent these assets were disclosed in the course of proceedings in Wiand I, plaintiffs request for relief should be denied. However, to the extent plaintiff alleges the existence of assets that were not addressed in Wiand I, the trial court should make a determination whether such assets were a part of the marital estate.

hi

Plaintiff also asserts that the trial court erred in dismissing her complaint in Wiand II. We disagree. While plaintiff correctly points out that some of the events alleged in Wiand II transpired after Wiand I was tried, the issue of defendant’s fraudulent concealment of assets was thoroughly addressed in Wiand I, and remedies were devised in that proceeding. The trial court did not err in concluding that a separate action was not proper.

Plaintiff also claims that the trial court improperly denied her motion to add parties defendant in Wiand II. Plaintiff argues that she is entitled to add thirty-two members of defendant’s family because postjudgment discovery after Wiand I revealed the existence of a conspiracy between defendant and these family members. Absent an abuse of discretion, this Court will not reverse a trial court’s decision whether to add parties to an action. Ombrello v Montgomery Ward Long Term Disability Trust, 163 Mich App 816; 415 NW2d 658 (1987).

Here, we believe that the trial court did not abuse its discretion in denying plaintiff’s motion to add thirty-two parties defendant as moot in view of its decision to grant defendant’s motion for summary disposition. Whatever claims plaintiff may have against other parties will have to be brought in a separate action. We make no comment regarding the merits of such an action.

iv

Finally, plaintiff argues that the trial court im properly denied her motion to amend her complaint to add a claim for independent equitable relief in Wiand II. However, the trial court properly found that it lacked jurisdiction to grant plaintiffs motion under MCR 7.208(A) because a claim of appeal had already been filed from the order of dismissal.

v

Accordingly, in Docket No. 134224, we affirm the October 2, 1990, order granting defendant’s motion for summary disposition pursuant to MCR 2.116(C) (7) and dismissing the complaint in (Wiand II). In Docket No. 135310, we affirm, any issues having been abandoned on appeal. In Docket No. 135309, we affirm the October 9, 1990, order denying plaintiffs motion to amend her complaint in Wiand II to add a claim for independent equitable relief, but reverse in part the order denying plaintiffs motion to set aside, modify, or obtain relief from the divorce judgment in Wiand I. On this last matter, we remand to the trial court with instructions to determine whether plaintiff has alleged undisclosed assets that were not addressed in Wiand I and, if so, whether they should have been included in the marital estate.

Affirmed in part and reversed in part.

1 Id. at 141.

2 Id. at 141-142.

3 Id. at 145.

4 Id at 146.

5 Id at 151.

6 Judge Mackenzie was a member of the panel that decided Wiand I. To the extent that Wiand I may be construed as requiring finality of the parties’ divorce judgment, she is now of the opinion that such a result is inconsistent with the public policy established by the Supreme Court in Sands to combat the concealment of assets.