Every so often we receive complaints that contain a count or claim for “constructive trust”. In these “claims” the parties generally seek a lien on a piece of property (real or personal) or to have the property deemed to be held “in trust” for their benefit. In fact, Michigan recognizes no independent cause of action for “constructive trust” and these “claims” are subject to summary...
Every so often the issue of “eavesdropping” comes up in a lawyer’s practice. Perhaps a client has recorded, or wants to record, a conversation with another party (most often a spouse, business partner or contracting party) or had their own conversation recorded by another party. Or maybe it is the lawyer who wants to record a conversation with unscrupulous opposing counsel who always seems...
It is well established that non-compete agreements in employment contracts are enforceable if they meant the requirements of MCL 445.774a of the Michigan Antitrust Reform Act (“MARA”). But what about non-compete agreements that do not arise in the employment context? In Brillart v. Danneffel, 36 Mich. App. 359 (1971), the Court of Appeals ruled that if good will was transferred in connection...
Plaintiffs frequently seek to pierce the corporate veil of companies against whom judgments may be or have been obtained in an attempt to extend liability to the defendants’ principals. Is piercing the corporate veil a viable cause of action separate from the underlying claims that seek to impose liability on the defendant entity? When can a piercing the corporate veil claim be asserted?...
Suppose that your client comes to you and says that he started a business and received funds from another person. Your client thinks that the other person simply made a loan to the business. The other person thinks that the funds are a capital contribution to a partnership, which made him a partner in the business. As is frequently the case, there is no formal documentation setting forth the...
In the world of commercial litigation there is an unavoidable complication that often arises during disputes: how to handle sensitive and proprietary information. When parties to business-centered disputes resort to litigation to solve their dispute, the information that is exchanged between the parties often includes sensitive financial material, such as documents, reports, trade secrets,...
As litigators, we often represent clients being pursued by creditors (banks, private lenders, bankruptcy trustees, etc.) seeking payment on loans or indebtedness. A strategy employed by many lawyers is to simply negotiate a discount on the indebtedness in exchange for immediate payment, with the remainder of the debt being “written off” by the creditor. If successful, this strategy will...
If your client is in default on a loan and lender’s counsel suggests stipulating to the appointment of a receiver, be aware of the potential pitfalls of doing so. You may be exposing the company’s owners and management to a lawsuit for breach of fiduciary brought by the receiver. The following recent Court of Appeals decision illustrates the perils of such a decision.
In Coppola v. Manning,...
In its recently issued opinion in Riewe v. Baron, 2015 Mich App LEXIS 1907 (October 20, 2015), the Michigan Court of Appeals dealt with some recurrent contract defenses that are frequently litigated in the Business Court. The defenses at issue were mutual mistake of fact, frustration of purpose and impossibility of performance, which, if successfully asserted, can be used to void, rescind or...
Building or remodeling a home often leads to disputes between homeowners and their builders over the quality of workmanship, cost increases or the timeliness of performance. In those instances, it sometimes turns out that the builder failed to obtain a residential builder’s license, as required by Michigan’s Occupational Code. In such cases, MCL 339.2412(1) of the Occupational Code bars the...
