Dessart v. Burak - Case Law

Michigan Supreme Court

Lansing, Michigan 48909

Chief Justice Justices

Opinion
Maura D. Corrigan Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman

FILED MAY 5, 2004

WILLIAM C. DESSART, and
SHIELA A. DESSART,

Plaintiffs-Appellants,

v No. 122238

LYNN MARIE BURAK, and
BRYAN R. BURAK,

Defendants-Appellees.

_______________________________

MEMORANDUM OPINION

Plaintiff argued that he was entitled to mediation

sanctions under MCR 2.403 in his third-party negligence

action. His claim for sanctions under MCR 2.403 requires a

determination whether “assessable costs” include attorney

fees and whether assessable costs are calculated from the

filing of the complaint to the rendering of the verdict.

The Court of Appeals answered both questions in the

negative. We affirm.
I. Procedural Background

Plaintiff William Dessart and defendant Lynn Burak

were involved in an automobile collision. Plaintiff and

his wife filed a third-party negligence action for injuries

plaintiff sustained in that accident. Before trial, a

mediation panel1 evaluated the case at $120,000. Plaintiffs

accepted the evaluation, but defendants rejected it.

Following a jury trial, plaintiff was awarded $100,000 in

damages. The circuit court denied plaintiffs’ motion for

mediation sanctions under MCR 2.403, concluding that the

adjusted verdict was “more favorable” to the defendants as

defined in MCR 2.403. The circuit court also rejected

plaintiffs’ argument that “actual costs” under MCR 2.403

includes attorney fees. The Court of Appeals affirmed the

decision of the circuit court. 252 Mich App 490; 652 NW2d

669 (2002).

II. Analysis

The proper interpretation of a court rule is a

question of law and is subject to review de novo. CAM

Constr v Lake Edgewood Condo Ass’n, 465 Mich 549, 553; 640

NW2d 256 (2002).

1
The procedure under MCR 2.403 formerly known as
"mediation" was renamed "case evaluation" effective
August 1, 2000. This change did not effect any substantive
change in the rule.
2
At the time the parties mediated this case, MCR 2.403

provided, in part:

(O) Rejecting Party's Liability for Costs.

(1) If a party has rejected an evaluation
and the action proceeds to verdict, that party
must pay the opposing party's actual costs unless
the verdict is more favorable to the rejecting
party than the mediation evaluation . . . .

* * *

(3) For the purpose of subrule (O)(1), a
verdict must be adjusted by adding to it
assessable costs and interest on the amount of
the verdict from the filing of the complaint to
the date of the case evaluation . . . . After
this adjustment, the verdict is considered more
favorable to a defendant if it is more than 10
percent below the evaluation, and is considered
more favorable to the plaintiff if it is more
than 10 percent above the evaluation. . . .

* * *

(6) For the purpose of this rule, actual
costs are

(a) those costs taxable in any civil action,
and

(b) a reasonable attorney fee based on a
reasonable hourly or daily rate as determined by
the trial judge for services necessitated by the
rejection of the case evaluation. [Emphasis
added.]

In their motion for mediation sanctions under this rule,

plaintiffs argued that the adjusted verdict exceeded

$108,000 (which is “more than 10 percent below the

evaluation” of $120,000) and, accordingly, was not “more

favorable to defendants” under MCR 2.403(O)(3). As such,

plaintiffs contended that they were entitled to mediation

sanctions under MCR 2.403(O)(1). Defendants responded that

plaintiffs miscalculated the adjusted verdict in two ways:

first, by including “assessable costs” from the filing of

the complaint to the verdict rather than from the filing of

the complaint to the case evaluation and, second, by

including attorney fees in “assessable costs.” The circuit

court denied plaintiffs' motion for sanctions, agreeing

with defendants that "assessable costs" are limited to

taxable costs incurred from the date the complaint is filed

until the date of case evaluation and do not include

attorney fees.

In affirming the decision of the circuit court, the

Court of Appeals panel acknowledged that in Beach v State

Farm Mut Automobile Ins Co, 216 Mich App 612; 550 NW2d 580

(1996), and Grow v W A Thomas Co, 236 Mich App 696; 601

NW2d 426 (1999), the term "assessable costs" in the court

rule was interpreted broadly to include postmediation costs

and attorney fees. The panel held, however, that those

cases were not controlling because their discussions of

assessable costs were obiter dicta. The panel also noted

that Beach was distinguishable because it involved a

statute that allows attorney fees as an element of damages

under certain circumstances. The panel held that attorney
4

fees are included in the "actual costs" awarded as a

mediation sanction, but not in "assessable costs" used to

determine whether a sanction should be awarded.

The Court also explained that the assessable costs

that are added to a verdict under MCR 2.403(O)(3) are those

incurred from the filing of the complaint to the date of

the case evaluation. In so concluding, the Court of

Appeals declined to follow the Grow Court in applying the

“last antecedent” rule of construction in interpreting the

mediation rule. This rule of construction provides that

“'a modifying clause is confined to the last antecedent

unless something in the subject matter or dominant purpose

[of the statute] requires a different interpretation.’”

Haveman v Kent Co Rd Comm’rs, 356 Mich 11, 18; 96 NW2d 153

(1959), quoting Kales v Oak Park, 315 Mich 266, 271; 23

NW2d 658 (1946), quoting Hopkins v Hopkins, 287 Mass 542,

547; 192 NE 145 (1934). The Court of Appeals concluded

that the application of the last antecedent rule in this

case would mean that the phrase "from the filing of the

complaint to the date of the mediation evaluation" modified

only "interest on the amount of the verdict" and not

"assessable costs." MCR 2.403(0)(1). The panel concluded

that such an interpretation of the rule "skews its dominant

purpose." 252 Mich App 497. Therefore, the panel held

that the modifying phrase in MCR 2.403(O)(3) applied to
5

both “assessable costs” and “interest.” This construction

of the court rule, the Court concluded, was more in keeping

with the overall purposes of the mediation rule, which are

“to encourage settlement, deter protracted litigation, and

expedite and simplify the final settlement of cases.” 252

Mich App 498.

We agree with the Court of Appeals that attorney fees,

whether incurred before or after the mediation evaluation,

are not an element of "assessable costs" under MCR

2.403(O)(3). The general “American rule” is that “attorney

fees are not ordinarily recoverable unless a statute, court

rule, or common-law exception provides the contrary.”

Nemeth v Abonmarche Dev, Inc, 457 Mich 16, 37-38; 567 NW2d

641 (1998). As such, the term “costs” ordinarily does not

encompass attorney fees unless the statute or court rule

specifically defines “costs” as including attorney fees.

For example, MCR 2.403(O)(6) provides that “actual costs”

include “(a) those costs taxable in any civil action, and

(b) a reasonable attorney fee . . . .” MCR 2.403(O)(6),

however, does not define “assessable costs” as including

attorney fees. We conclude, therefore, that attorney fees

are not included in “assessable costs” under MCR

2.403(O)(3).

We also agree that in adjusting a verdict under MCR

2.043(O)(3), assessable costs are limited to those incurred
6

between the filing of the complaint and the date of the

mediation evaluation or case evaluation.

Plaintiffs have urged upon us the position that

utilization of the “last antecedent” rule would support the

conclusion that the modifying phrase applies only to

“interest.” Here, however, the last antecedent rule

provides little guidance because there are no textual clues

indicating that “assessable costs” and “interest” are to be

treated separately. To the contrary, the fact that “and”

joins “assessable costs” and “interest on the amount of the

verdict from the filing of the complaint to the date of the

case evaluation” suggests that the phrase “assessable costs

and interest” is to be thought of as a single term, and, as

a unit, is modified by “from the filing of the complaint to

the date of the case evaluation.” MCR 2.403(0)(3).

Moreover, plaintiffs’ suggested reading produces conceptual

difficulties because it would provide no temporal limit at

all to “assessable costs” and would make it possible for a

party, remorseful over its failure to accept the mediation

award, to advantage itself between mediation and trial by

accruing unnecessary costs. This is an outcome that surely

could not have been intended by the Court in adopting these

rules. Indeed, the plain meaning of the rule and its

grammatical structure make it clear that the rule does set

the temporal limit as the date of case evaluation. On the
7

basis of the foregoing application of the principles of

construction, we affirm the judgment of the Court of

Appeals. MCR 7.302(G)(1).

Maura D. Corrigan
Michael F. Cavanagh
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman

S T A T E O F M I C H I G A N

SUPREME COURT

WILLIAM C. DESSART, and
SHIELA A. DESSART,

Plaintiffs-Appellants,

v No. 122238

LYNN MARIE BURAK, and
BRYAN R. BURAK,

Defendants-Appellees.

_______________________________

WEAVER, J. (concurring in result).

I concur in the majority’s determination that the last

antecedent rule does not control the interpretation of the

court rule at issue in this case.

I agree with and adopt the Court of Appeals reasoning

that applying the last antecedent rule to MCR 2.403(O)(3)

“skews [the court rule’s] dominant purpose,” which is to

encourage settlement, deter protracted litigation, and

expedite and simplify the final settlement of cases. 252

Mich App 490, 497; 652 NW2d 669 (2002).

I write separately because in its efforts to avoid

applying the last antecedent rule, the majority

unnecessarily creates a new rule of interpretation—that

when two phrases are joined by “and,” they are to be
treated as one term for the purpose of the last antecedent

rule unless there is some textual clue indicating that they

are to be treated separately. This new rule of

interpretation conflicts with the last antecedent rule,

which provides that a limiting clause or phrase should

ordinarily be read as modifying only the noun or phrase

that it immediately follows, unless there is some

indication to the contrary.1

The majority’s creation of the new conflicting rule of

interpretation is unnecessary because, although the last

antecedent rule is a well-recognized rule of statutory

construction, its use is optional, not mandatory. As

Sutherland On Statutory Construction explains, the last

antecedent rule is “another aid to discovery of intent or

meaning and is not inflexible and uniformly binding. Where

the sense of the entire act requires that a qualifying word

or phrase apply to several preceding or even succeeding

1
Barnhart v Thomas, 540 US ___; 124 S Ct 376, 380; 157
L Ed 2d 333 (2003), citing 2A Singer, Sutherland on
Statutory Construction, § 47.33, p 369 (6th rev ed, 2000)
(“Referential and qualifying words and phrases, where no
contrary intention appears, refer solely to the last
antecedent.”)

sections, the word or phrase will not be restricted to its

immediate antecedent.”2

I concur in the result of the memorandum opinion.
Elizabeth A. Weaver

2
2A Singer, Sutherland on Statutory Construction, §
47.33, p 372 (6th rev ed 2000).