Litigation over promissory notes and related loan documents tends to be formulaic. Frequently, a borrower in clear default of some of the material terms of those documents (usually the obligation to repay the money borrowed) will tell his or her attorney that the loan documents were signed in reliance on a variety of representations the lender has since ignored or repudiated, giving rise to...
Last month, we started discussing a scenario involving a plaintiff with a judgment against the now defunct Darn Debtor, Inc. (“Debtor”). The judgment debtor’s majority shareholder, Ina Insider (“Insider”), received cash and equipment from Debtor when it liquidated its assets. The plaintiff has decided to bring a claim against Insider under MCL 566.35(2) of the Michigan Uniform Fraudulent...
As the use of Business Court expands, the issue of their jurisdiction continues to play out between those courts and practitioners. In a previous blog update, we discussed how Business Courts were taking supplemental jurisdiction over claims that were not, standing alone, Business Court claims. We are now seeing business courts doing the same with claims and parties that are not, standing...
So you have finally triumphed after a long legal battle and obtained a judgment in favor of your client against the defendant Darn Debtor, Inc. (“Debtor”). However, no sooner do you have your judgment then the defendant’s counsel informs you that their client is judgment proof and won’t even bother with an appeal. What is likely to happen next?
The plaintiff’s attorney will very likely conduct...
When attorney-client and work product privilege issues are litigated, the disputes usually involve the applicability of the privilege, whether any exceptions apply or whether the privilege has been waived. This month’s blog deals with a different spin on the law of privileges, namely, do those privileges ever cease to exist? Here is how that question may arise.
There is a notion under Michigan...
Last month, we discussed the Michigan Supreme Court’s decision in Madugula v. Taub, 2014 Mich. LEXIS 1281 (July 15, 2014), in which the Court held that shareholder oppression claims, including those seeking damages, can only be tried before judges sitting as courts of equity. This month, we focus on one of the strategic implications of that decision: does Madugula apply to limited liability...
When lender and borrower relationships break down – especially where the borrower defaults in payments owed to the lender – the borrower often feels (and perhaps justifiably so) that the lender is treating them unfairly or is acting contrary to certain oral promises that may have been made at an earlier time. For instance, at the beginning of a lending relationship, the lender may tell the...
The Court of Appeals recently upheld the dismissal of malpractice and fiduciary duty claims alleging that an accountant failed to “keep an eye” on the company’s controller who later engaged in a two year long embezzlement scheme, stealing over $400,000. Banker & Brisebois, Co. v Maddox, et al., unpublished per curiam opinion of the Court of Appeals, No. 310993 (April 29, 2014).
The...
For those of you who thought shareholder oppression cases could be tried to a jury, think again. It is true that the Michigan shareholder oppression statute, MCL 450.1489(f) of the Business Corporation Act, states that “if the shareholder establishes grounds for relief, the circuit court may make an order or grant relief as it considers appropriate, including, without limitation, an order...
Whether or not you are on Facebook or are a devoted user of social media apps, as a litigator you have to be, at the very least, aware of how technology affects discovery and can potentially lead to a gold mine of information. Moreover, some knowledge of how technology affects litigation is essentially mandatory now. Comment 8 to Rule 1.1 of ABA Model Rule regarding competent representation...
